Abakan reviews 2014 performance

Abakan Inc. has distributed its 2014 Year in Review, as previously disclosed as an exhibit to its Form 8-K filed with the Commission on 31 December 2014. Robert Miller, CEO of Abakan Inc., released the following statement:

To our valued shareholders,

I write with great confidence at this time of the year as I look back at the goals, challenges and accomplishments we have tackled over the last twelve months, due to the support of each and every one of our shareholders, employees and management. Thank you.

MesoCoat Inc., our principal subsidiary, went through many ups and downs, typical of a development stage company as it strove to take products to market in 2014. We have proven that our disruptive technologies, products and future products are better or will be better solutions for their intended use. The reality of that statement to us is one of discernible value. The most important indicator of that value is that many multinational corporations and government organisations have been giving us a helping hand to complete our journey. Abakan's share price did not perform as we all would have liked in 2014, but I foresee a less volatile and better valuation in 2015 based on the important alliances, organisational changes and goals achieved during this past year and on what we expect to accomplish this coming year in technology advances, sales and other corporate developments.

Abakan prides itself on having worked 24-7 to reach our common goals. For many of our team ‘24-7’ is not a figure of speech but an actual commitment that I witness week in and week out. I know that this commitment will continue until we can capitalize on the value created by our work as we maximise the parameters of our technology development and focus on marketing. Abakan is very fortunate in that ours is a market driven by market-pull (demand) rather than a market-push (marketing). The effect being that we believe that Abakan is at the onset of creating a global presence with superior products that lend proven solutions to given problems in the marketplace.

2014 was an exciting year for us. We secured commitments for US$9 million in equity, non-dilutive and debt financing, increased our direct ownership in MesoCoat to 87.5%, and doubled our PComP powder production capability. We were awarded several large test and commercial orders for our PComP coatings from certain of the world's largest steel and mining companies. Our CermaClad related efforts have included successfully cladding ever longer sections of pipe with every run as we approach our goal of cladding full-length (40 ft) pipes. When we meet this primary objective MesoCoat will be in a position to commence commercial sales. We have also secured several fully funded developmental projects to develop new products that will sustain a healthy product pipeline. Working in collaboration with our global sales partners we are in the process of creating product marketing channels in Canada, Mexico and Asia. Furthermore, during 2014, our products won a couple of highly prestigious industry awards, and added several new experts to our technical and commercial team.

While 2014 was a very busy year for us, we expect 2015 to be even more exciting. We expect to commission a 160 t PComP powder production facility that will also include three thermal spray coating cells by September 2015. When fully operational, the new PComP production and coating facility could produce enough powders and coating services to generate approximately US$32 million in annual revenues. Additionally, we expect to develop full-length (40 ft) clad pipes before the end of 2015. Once accomplished, we expect to set up our first 4-line clad pipe manufacturing facility and begin full-scale clad pipe production. One such manufacturing facility could generate approximately US$220 million in annual revenues. We also expect to expand our footprint in Mexico, Canada, and Asia in 2015 with an eye on also creating a presence in the Middle East.

The constant recognition we receive from leading research institutes, trade bodies, media houses and development partners and customers is a source of ongoing validation for our team. Our solutions embody a suite of disruptive innovations in materials, process and products. We are not trying to improve things by only 10%; that is not and will never be our goal. Rather, we are developing groundbreaking solutions that are up to one or more orders of magnitude (ten times) better than what currently exists in the market. We know that this is not an easy task. Our path is laborious and challenging along a timeline that has frankly taken us a lot longer than we anticipated. However, we believe that the finish line is in sight and that reaching the end goal will be well worth the effort.

Despite the delays, we have made great strides towards reaching our PComP and CermaClad goals in 2014. We are well positioned to achieve our PComP production expansion and are within reach of beginning the full scale production of full sized 40 ft clad pipe in 2015. On a final note, I would like to iterate that there are very few companies in the world of material science like Abakan, with such a diverse portfolio of products that can offer an order of magnitude higher value proposition when compared to competing products. I look forward to providing additional updates on our progress as we move forward.

Adapted from press release by Rosalie Starling

Read the article online at: https://www.worldpipelines.com/business-news/06012015/abakan-reviews-2014-performance-14/