PureCycle Technologies, Inc. (
PCT) is a publicly-traded company that specializes in the recycling of polypropylene, a widely used thermoplastic polymer. Founded in 2015,
PCT uses a proprietary technology that removes color, odor, and contaminants from recycled polypropylene, producing high-quality plastic pellets that can be used in a variety of applications.
PCT's mission is to create a circular economy for plastic, where waste is minimized, and resources are conserved. The company's recycling process is both environmentally and economically sustainable, as it reduces the need for virgin plastic production and reduces plastic waste in landfills and oceans.
PCT's achievements:
PCT has achieved several milestones since its inception. In April 2021, the company went public through a merger with a special purpose acquisition company (SPAC) called Roth CH Acquisition I Co. The deal raised $414 million in gross proceeds, which
PCT intends to use to fund the expansion of its recycling capacity.
PCT has also entered into several partnerships with leading companies in the plastic industry. In December 2020,
PCT announced a collaboration with Nestle to produce food-grade recycled polypropylene, which will be used in packaging for Nestle's products. This partnership demonstrates
PCT's commitment to producing high-quality recycled plastic that meets the stringent standards of the food industry.
In addition to Nestle,
PCT has partnered with consumer goods companies such as L'Oreal and BMW to incorporate recycled polypropylene into their products. These partnerships not only provide
PCT with a reliable customer base but also help to promote sustainable practices in the plastic industry.
PCT's setbacks:
While
PCT has achieved significant success in its mission to create a circular economy for plastic, the company has faced some setbacks. In March 2021,
PCT announced that it had discovered a material weakness in its financial reporting controls, which could lead to errors in its financial statements. This announcement led to a drop in the company's stock price.
PCT has also faced challenges in scaling its technology. While the company's recycling process has been successful in small-scale trials, scaling the process to commercial levels has proven difficult.
PCT has experienced delays in the construction of its first recycling facility in Ohio, which was originally scheduled to open in 2020 but has been pushed back to 2022. These delays have slowed
PCT's expansion plans and may limit the company's ability to meet customer demand.
Our Conclusion:
In conclusion, PureCycle Technologies, Inc. has made significant strides in promoting sustainable practices in the plastic industry. The company's proprietary technology and partnerships with leading companies demonstrate its commitment to creating a circular economy for plastic.
However,
PCT has also faced challenges, including a material weakness in its financial reporting controls and delays in scaling its technology. As
PCT continues to expand its recycling capacity and grow its customer base, it will need to address these challenges to maintain its position as a leader in the plastic recycling industry.
If you're willing to look past all the challenges (we're not), this company could be a decent trade at some point if you can get the timing just right.
