By Bay Street standards, the plus-side numbers were modest, to say the least.
Nevertheless, Tuesday, Aug. 26 was a red-letter day for one of corporate Alberta’s good guys – engineer, teacher and innovator David Manz, president/CEO of Calgary’s Davnor Water Treatment Technologies.
Davnor reported its first-ever quarterly profit that day, one year after going public. Manz didn’t need a wheelbarrow to tote the company’s second-quarter revenues of $434,647 (net earnings: $129,369) to the bank. But you can bet he was whistling all the way.
This tiny company (DAV-TSXV), which spun off from Manz’s successful humanitarian efforts to develop cheap and portable water- filtration systems for disease-plagued residents of developing countries, seems poised to hit its stride.
Last spring, Davnor closed an important deal by agreeing to supply chlorinated drinking water for 72 homes in the Millarville area, after getting a green light from Alberta Environmental Protection.
|Larry MacDougal, Business Edge|
|Davnor Water Treatment Technologies Ltd. president and CEO David Manz displays examples of sand filter treatment units in Davnor’s showroom. The low-cost units are in use around the world.|
At the moment, Manz, a one-time University of Calgary professor, is jazzed about a number of signed letters of intent that should open up new markets in Algeria, Kenya, Tanzania, Uganda and Mexico.
Meanwhile, Davnor remains optimistic that negotiations with Honduran interests will lead to a contract to provide water treatment for a town of 10,000 residents. If the project goes ahead, it’ll be the largest in the company’s seven-year history.
“The engineers down there love Davnor technology,” Manz grinned.
There’s plenty to like. In 1996, Manz won APEGGA’s Project Achievement Award for introducing dramatic refinements to a 180-year-old process known as slow-sand filtration. Davnor’s BioSand Water Treatment Systems have been garnering rave reviews ever since.
Since going public with an initial offering of 25 cents a share, however, Davnor hasn’t exactly taken the investment world by storm.
“It was a hugely bad time to be going public,” Manz acknowledged in retrospect, referring to dismal market conditions at the time.
“This was frustration beyond anything I can possibly imagine. But we pulled it off,” he said with a grin.
A scientist by training and inclination, he’s had to learn the business ropes by guess and by gosh. Still, a string of promising sales successes bodes well for the future. Manz and his small team (nine full-time employees) are a patient bunch, content to lay down strong foundations to facilitate long-term growth.
At a bargain-basement price, Davnor is a clear- conscience buy, appealing to investors who prefer stocks that reflect their own ethical and environmental values.
Last March, the company captured a Calgary Export Achievement Award for demonstrating high standards of corporate social responsibility.
And it all started in 1988, when Manz, then a U of C engineering prof specializing in hydraulics and waste-water management, was asked to evaluate remote South African water-treatment systems.
“It didn’t take us long to discover that traditional approaches they were taking to water treatment were not efficient. Either the treatment technologies were no good or the methods were too sophisticated for the locals to operate,” Manz remembered.
Back in Calgary, Manz and his grad students began tinkering with slow-sand filter technology. It was well-known as a simple and effective way to remove parasites and disease-causing micro-organisms from drinking water.
But traditional purification methods forced users to keep the filters running non-stop.
Manz and his student team found a way to run the filters intermittently, without destroying the sand filter’s biological “matrix” of living organisms that facilitate the cleansing process.
Originally, Davnor was incorporated to finance the charitable distribution of the souped-up filters – a godsend for a developing world that loses thousands of children a year to the pathogens that flourish in foul drinking water. “But it became apparent there was a conflict and we had to resolve it,” said Manz.
In 1998, he resigned from the U of C to concentrate on the new company.
Meanwhile, the not-for-profit Centre for Affordable Water and Sanitation Technology (CAWST) was set up in Calgary as a separate charitable vehicle for bringing the filtration technology, now in use in 60 countries, to poor, developing regions. Manz sits on the CAWST board and contributes free technical advice, when asked. But his involvement stops there.
Today, his sole focus is to make Davnor a sustainable commercial success. Based on second-quarter numbers, he’s off to an encouraging start.
Apart from his international marketing thrust, Manz sees plentiful domestic opportunities too, including vacation properties and First Nations communities.
“If we do our job well, we will last,” he said. “We just have to endure. Then we can gradually grow.”