Carbonxt Locks in WPS Pellet Order Lifting FY27 Revenue Outlook Past 33% Growth
Key Takeaways
- Wisconsin Public Service has placed an increased AC Pellet order with Carbonxt, representing a minimum 25% uplift on total FY26 revenue, with deliveries running through to the end of FY27 on standard 14-day payment terms.
- Combined with approximately $2.0 million in additional revenue from a second major pellet customer, Carbonxt now expects FY27 revenue to exceed FY26 by more than 33% — with no new customer acquisition required.
- The WPS supply relationship is underpinned by a long-term contract tied to the operating life of the Weston Power Plant, which WPS has publicly committed to running until at least 2032.
- Carbonxt's new Minnesota facility reduces monthly operating costs by approximately US$10,000 and is designed for future capacity expansion, though a two-week production timing gap will be visible in the 1QFY27 quarterly report.
- The Kentucky facility remains entirely outside FY27 guidance and has been framed by management as additional upside beyond the current revenue base.
WPS doubles down on Carbonxt’s AC pellets, lifting FY27 revenue outlook above 33% growth
Carbonxt Group Limited (ASX: CG1) has received an increased Activated Carbon Pellet order from Wisconsin Public Service (WPS), its largest customer, with deliveries running from now through to the end of FY27 on standard 14-day payment terms. Combined with a volume uplift from a second major pellet customer reported in the June 2026 Quarterly Activities Report, the company now expects FY27 revenue to exceed FY26 by more than 33%.
Critically, this revenue upgrade requires no new customers. It comes entirely from deepening existing relationships, with the WPS order alone representing a minimum 25% increase on Carbonxt’s total FY26 revenue.
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Q1 FY27 order details and what’s driving WPS demand
The WPS relationship and why it’s expanding
Carbonxt has supplied WPS since 2016 and holds a long-term supply contract covering the life of the Weston Power Plant near Wausau, Wisconsin. WPS has publicly stated that Weston will operate until at least 2032, providing a contractual revenue floor that extends well beyond the current order period.
WPS requested the additional AC Pellets to support increased operations at Weston, where they are used in the plant’s ReACT emissions control system. The nature of that system (explained in the next section) means AC Pellet consumption is tied directly to how hard the plant runs.
FY27 revenue outlook: the numbers
The company has stated a set of explicit assumptions underpinning its FY27 revenue expectation. These are company-stated forecasts, not guarantees, and actual results may differ:
- WPS order contributes a minimum +25% on total FY26 revenue
- Second major pellet customer uplift contributes approximately $2.0 million of additional FY27 revenue (reported in the June 2026 quarterly)
- Combined effect: FY27 revenue expected to be more than 33% above FY26
- Gross margins on incremental volume expected at or around current performance
- AUD/USD exchange rate assumed at 0.71
- Powdered Activated Carbon volumes held at current levels in the forecast
- Kentucky facility excluded from FY27 forecast, flagged as additional upside only
| Revenue Driver | Customer | Reported | FY27 Revenue Contribution | Included in Guidance |
|---|---|---|---|---|
| Increased AC Pellet order | Wisconsin Public Service (WPS) | 15 September 2026 | Minimum +25% on FY26 total revenue | Yes |
| Increased pellet volumes | Second major pellet customer | June 2026 quarterly | ~$2.0 million additional revenue | Yes |
| Kentucky facility | Not disclosed | Not yet operational | Not quantified | No (additional upside only) |
What is ReACT technology and why activated carbon pellets matter
ReACT (regenerative activated coke technology) is an integrated emissions control system used in coal-fired power plants. It works by passing flue gas through a bed of activated coke, which adsorbs (binds and captures) multiple pollutants simultaneously, including Nitrogen Oxides (NOx), Sulphur Oxides (SOx), and mercury (Hg). Adsorption, put simply, is a process where pollutant molecules adhere to the surface of a solid material rather than passing through into the atmosphere.
AC Pellets are the consumable input that makes the ReACT system function. As the coke is used, it must be replenished, which means pellet purchases recur as long as the plant operates. This is the commercial structure that makes Carbonxt’s WPS revenue so visible: it is not a one-time equipment sale, but an ongoing supply relationship tied to a regulated, contracted industrial process.
For investors, the key point is that WPS has committed to operating Weston until at least 2032. Every year the plant runs, it requires AC Pellets.
Minnesota facility relocation and the path ahead
New facility, lower costs, greater scalability
Production of pellets under this order commences immediately at Carbonxt’s new Minnesota facility, which the company is relocating from its previous Arden Hills site. The new location reduces monthly operating costs by approximately US$10,000 and is designed to allow future capacity expansion at lower cost.
There is a one-off timing item to note: the relocation resulted in a pellet production and revenue decrease equivalent to approximately two weeks of production in the September 2026 quarter. This will be reflected in the 1QFY27 quarterly report. Management has presented this as a timing impact from the transition rather than a structural issue with production capacity.
Kentucky facility remains on the horizon
The Kentucky facility is explicitly excluded from FY27 revenue forecasts. Managing Director Warren Murphy has framed it as additional upside beyond the current guidance base, with no specific timing or revenue contribution disclosed in this announcement.
Warren Murphy, Managing Director, Carbonxt Group Limited
“This order reflects the strength of the partnership we have built with WPS over the past decade. Two of our three largest pellet customers are now increasing their volumes, which gives us clear visibility into FY27 at margins consistent with our recent performance. All of this comes from our existing business, and it sits ahead of the commissioning of our Kentucky facility, which remains additional upside.”
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Investment case: revenue visibility from existing customers
This announcement gives investors several concrete reasons to reassess Carbonxt’s FY27 revenue profile:
- Revenue upgrade is demand-led. Growth exceeding 33% over FY26 comes from existing customers deepening their commitment, with no new customer acquisition required.
- Concentration risk is easing. Two of Carbonxt’s three largest pellet customers are now increasing volumes, which distributes revenue exposure more broadly across the customer base.
- Gross margins are expected to hold. The company has explicitly stated that margins on incremental volume are expected at or around current performance levels.
- Kentucky is unpriced upside. Any future contribution from the Kentucky facility sits entirely outside the current FY27 guidance, meaning it is additive if and when it comes online.
- The WPS contract runs to at least 2032. This is not a single order but a supply relationship underpinned by a long-term contract tied to the operating life of a regulated power asset.
Carbonxt’s FY27 revenue story is built entirely on contracted, existing customer demand, with a greenfield facility still to contribute.
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