TMC the metal company (TMC) - 2024 Q3 - Quarterly Results

FORM 8-K Filing Details This section details the filing specifics of TMC THE METALS COMPANY INC.'s Form 8-K, including corporate identification, jurisdiction, and registered securities Registrant Information TMC THE METALS COMPANY INC. filed this Form 8-K on November 12, 2024, providing its corporate identification and contact details, including its jurisdiction of incorporation in British Columbia, Canada - Registrant: TMC THE METALS COMPANY INC.[1] - Date of Report: November 12, 2024[1] - Jurisdiction of incorporation: British Columbia, Canada[1] Securities and Emerging Growth Status The Company's common shares (TMC) and redeemable warrants (TMCWW) are registered on The Nasdaq Stock Market LLC. TMC is identified as an emerging growth company Registered Securities | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :---------------------------------------------------------------------------------------------------------------------------------------------- | :---------------- | :---------------------------------------- | | TMC Common Shares without par value | TMC | The Nasdaq Stock Market LLC | | Redeemable warrants, each whole warrant exercisable for one TMC Common Share, each at an exercise price of $11.50 per share | TMCWW | The Nasdaq Stock Market LLC | - The registrant is an emerging growth company[3] Item 2.02 Results of Operations and Financial Condition This section incorporates preliminary unaudited financial information for the three months ended September 30, 2024, by reference from Item 8.01 - Preliminary unaudited financial information for the three months ended September 30, 2024, is incorporated by reference from Item 8.01[3] Item 8.01 Other Events This section provides a comprehensive corporate update, including NORI's application timeline, ISA Mining Code progress, strategic adjustments, and preliminary Q3 2024 financial data Corporate Update Overview On November 12, 2024, TMC provided a corporate update covering the expected submission date of NORI's exploitation application, ISA progress on the Mining Code, additions to the Company's business strategy, and preliminary unaudited financial information for Q3 2024 - Corporate update provided on November 12, 2024, covering NORI application, ISA Mining Code, business strategy, and Q3 2024 preliminary financials[4] NORI Application Submission and Strategy NORI plans to submit its exploitation application to the ISA by June 27, 2025, with Nauru seeking ISA clarification on the process to assert provisional approval rights - NORI expects to submit its application for an exploitation contract to the ISA by June 27, 2025[5] - Nauru is formally requesting ISA clarification on the submission and review process at the March 2025 meetings[6][7] - The Company believes the process is already defined by UNCLOS and the 1994 Agreement, allowing for provisional approval[7] Mining Code Progress The ISA Council completed a first reading of the draft Mining Code in July 2024, with a revised consolidated text anticipated by the end of November 2024 - ISA Council completed a first reading of the draft Mining Code in July 2024[8] - A revised consolidated text of the draft Mining Code is expected by the end of November 2024[8] Operational and Capital Expenditure Adjustments TMC is reducing operating expenses to achieve quarterly cash use below $5 million post-application, deferring Hidden Gem vessel capital expenditures until regulatory clarity or financing - Expected quarterly cash use of less than $5 million after NORI application submission[9] - Operating expense reductions are being implemented to ensure financial resiliency[9] - Capital expenditures for the Hidden Gem vessel are deferred until final RRPs adoption, application approval, or non-dilutive financing[10] Expanded Company Strategy TMC is pursuing a new strategy to develop a seafloor resource development services business and to optimize/diversify its global resource portfolio - New strategy to develop a services business for seafloor resource development[11] - New strategy to optimize and diversify its resource portfolio within the Area and in national jurisdictions[11] - Actively evaluating opportunities for new exploration contract areas, permitted properties, and producing properties[11] Preliminary Unaudited Financial Information (Q3 2024) TMC reported preliminary unaudited financial estimates for Q3 2024, including $0.4 million cash on hand, $9.2 million in short-term debt, and $5.7 million net cash used in operating activities Preliminary Unaudited Financial Estimates (Q3 2024) | Metric | Amount (Millions USD) | | :-------------------------------------- | :-------------------- | | Cash on hand (as of Sep 30, 2024) | $0.4 | | Short-term debt (as of Sep 30, 2024) | $9.2 | | Operating expenses (Q3 2024) | $20.0 | | Net cash used in operating activities (Q3 2024) | $5.7 | | Undrawn 2024 Credit Facility | $20.8 | | Undrawn 2023 Credit Facility | $27.5 | | Available under ATM Sales Agreement | $25.0 | | Raised via ATM (9 months ended Sep 30, 2024) | $4.9 | | Average ATM share price | $1.53 | - The financial information is estimated, unaudited, and preliminary, subject to finalization[14] Risk Factors Investors are directed to review the comprehensive risk factors outlined in the Company's 2023 Form 10-K, Q2 2024 Form 10-Q, and Exhibit 99.1 of this 8-K - Investors should carefully review risk factors from the 2023 Form 10-K, Q2 2024 Form 10-Q, and Exhibit 99.1 of this 8-K[15] Forward-Looking Statements This section contains forward-looking statements regarding future events, cautioning that actual results may differ materially due to various risks and uncertainties - The report includes forward-looking statements about the NORI application, Mining Code adoption, future financial performance, and new business strategies[16] - Actual results may differ materially due to significant risks and uncertainties, including regulatory changes, operational challenges, and market fluctuations[16] Item 9.01 Financial Statements and Exhibits This section lists the exhibits accompanying the Form 8-K filing, specifically Exhibit 99.1 for Risk Factor Updates and Exhibit 104 for the Cover Page Interactive Data File Exhibits This section lists the exhibits accompanying the Form 8-K filing, specifically Exhibit 99.1 for Risk Factor Updates and Exhibit 104 for the Cover Page Interactive Data File Exhibits Filed | Exhibit No. | Description | | :---------- | :-------------------------------- | | 99.1 | Risk Factor Updates | | 104 | Cover Page Interactive Data File | Signatures This section confirms the official signing of the report by Craig Shesky on behalf of TMC THE METALS COMPANY INC. on November 12, 2024 - Report signed by Craig Shesky on behalf of TMC THE METALS COMPANY INC.[19][20] - Date of signature: November 12, 2024[20]