What you need to know: • BQE will be reporting Q4 & 2023 financial results in ~2 weeks, we are expecting proportional revenue of $4.2M, gross margin of 45%, and adj. EBITDA of $0.6M (14% margin). • Metals prices have been rising steadily over the last month with copper up 9%. BQE’s China JV has leverage to the copper price as it sells recovered metals. • BQE remains cheap at 10.0x/8.6x 2024E/2025E EBITDA. BQE Water (BQE:TSXV, BTQNF:OTC) will be reporting Q4 and 2023 financial results around April 25th. We are expecting another strong quarter from BQE, albeit Q4 being a seasonally weak quarter. An overview of our estimates can be found below. BQE stock is up 47% since our initiation report last month (read here), yet we are still highly bullish in our thesis and will reassess our target price on the back of the financial results. We are maintaining our BUY rating and $55.00/share target price on BQE Water. Q4 & 2023 Financials Preview For Q4, we are expecting: • Proportional revenue of $4.2M (-2% YoY) comprised of reported revenue at $2.8M and share of JV revenue at $1.4M • Gross margin of 45% compared to 41% in Q4/22 (note that this is reported as operating margin before depreciation) • Adjusted EBITDA of $0.6M (14% margin) compared to ($0.1M) in Q4/22 • Net income of $0.4M or $0.29/share compared to ($0.2M) or ($0.19/share) in Q4/22 For 2023, we are expecting: • Proportional revenue of $21.5M (+14% YoY) comprised of reported revenue at $15.9M and share of JV revenue at $5.6M • Gross margin of 48% compared to 42% in 2022 • Adjusted EBITDA of $4.7M (22% margin) compared to $3.1M (16% margin) in 2022 • Net income of $2.8M or $2.22/share vs. $1.2M or $0.93/share in 2022