Financial Performance - Revenue for the three months ended September 30, 2024, was $201,960, compared to $0 for the same period in 2023[11] - Gross loss for the period was $(2,340,681), with total operating expenses of $7,462,483, down from $8,017,770 in the prior year[11] - Net loss for the three months ended September 30, 2024, was $(11,694,569), compared to $(8,891,977) for the same period in 2023, reflecting an increase in losses[11] - The company reported a net loss of $11.7 million for the three months ended September 30, 2024, compared to a net loss of $8.9 million for the same period in 2023, representing a 31% increase in losses year-over-year[21] - Cash used in operating activities was $5.6 million for the three months ended September 30, 2024, compared to $4.8 million for the same period in 2023, indicating a 17% increase in cash outflow[21] - The company incurred a net loss of $11.8 million or $0.17 loss per share for the three months ended September 30, 2024, compared to a net loss of $8.9 million or $0.19 loss per share in the same period of 2023[142] - Operating expenses for the three months ended September 30, 2024, were $7.5 million, a decrease from $8.0 million in the same period of the prior year[137] Equity and Stockholder Information - Total stockholders' equity decreased to $59,344,596 as of September 30, 2024, down from $61,467,640 as of June 30, 2024[10] - Common shares issued increased to 73,342,037 as of September 30, 2024, from 64,061,763 as of June 30, 2024[10] - The weighted average shares outstanding increased to 69,519,432 for the quarter ended September 30, 2024, compared to 46,129,507 for the same period in 2023[11] - The total potentially dilutive shares outstanding increased to 16,061,307 from 9,807,025 in 2023, representing a growth of approximately 63%[103] - The Company issued 726,216 common shares in lieu of cash payment of $0.6 million, with a fair value of $0.7 million recorded in additional paid-in capital[100] Cash and Financing Activities - The company had a cash balance of $5.8 million as of September 30, 2024, with an accumulated deficit of $225 million[21] - The company generated $6.9 million in proceeds from the issuance of common shares through At-The-Market offerings during the quarter[21] - The Company entered into a Credit Agreement for up to $20 million, which included a $6 million term loan and $14 million in delayed draw term loan commitments[75] - The Company sold up to $51 million in senior secured convertible notes, with $25 million received to date and $22.2 million repaid[77] - As of September 30, 2024, the principal outstanding on the Notes was $2,883,333, with a net carrying value of $2,560,302 after accounting for debt discount and issuance costs[81] Research and Development - Research and development expenses for the quarter were $2,032,135, down from $3,613,852 in the same quarter of the previous year[11] - The company recognized $1.4 million of invoiced government funds as an offset to R&D costs during the period ended September 30, 2024[49] - The Company has been awarded a $2 million grant from the U.S. Advanced Battery Consortium to support the development of its integrated lithium-ion battery recycling facility[127] - An additional grant of $20 million from the U.S. Department of Energy under the Bipartisan Infrastructure Law will support the validation and deployment of advanced recycling technologies[127] Assets and Liabilities - As of September 30, 2024, the Company had a total property, plant, and equipment net value of $45.42 million, an increase from $46.31 million as of June 30, 2024[66] - The Company’s total accounts payable and accrued liabilities decreased to $7.40 million as of September 30, 2024, from $9.35 million as of June 30, 2024[74] - Current liabilities decreased to $10.0 million as of September 30, 2024, from $15.8 million at June 30, 2024[144] - Working capital improved to $5.5 million as of September 30, 2024, compared to $2.6 million at June 30, 2024[145] Internal Controls and Compliance - The company's disclosure controls and procedures were deemed ineffective as of September 30, 2024, due to material weaknesses identified[161] - Material weaknesses in internal control over financial reporting were noted, including insufficient personnel with appropriate technical expertise and lack of proper segregation of duties[165] - Remediation efforts included hiring a new corporate controller and a senior accountant to address internal control deficiencies, with expectations to remediate by the end of fiscal year 2025[167] - The Company is committed to ensuring effective internal control over financial reporting, although there is no assurance that material weaknesses will be fully remediated[168] Risks and Challenges - The company is assessing its ability to continue as a going concern, dependent on generating profits or obtaining financing[22] - The company faces significant risks in a competitive industry, particularly in battery recycling, where established companies may have more resources[177] - The market price of lithium-based products is highly volatile and influenced by factors beyond the company's control, affecting potential revenues[183] - The company has not yet achieved full commercialization, facing challenges such as significant capital requirements and accumulated losses[175] - The Company faces risks related to obtaining necessary environmental permits, which could delay operations and adversely affect financial results[191] - Changes in government regulations may impact project development, including laws related to environmental compliance and production restrictions[207] - The Company must comply with evolving environmental regulations, which may require stricter standards and could increase project costs[208] Grants and Tax Credits - Cumulative funds invoiced for the DOE grant related to lithium hydroxide refinery project total $2.5 million, representing 4% of total eligible reimbursements[53] - The Company has incurred qualifying expenditures for a tax credit of up to $19.5 million but will not recognize amounts until compliance assurance is met[55] - The Company has not incurred any qualifying expenditures towards an additional tax credit of up to $40.5 million as of September 30, 2024[56] - ABTC was awarded a $19.5 million tax credit and an additional $40.5 million tax credit to support its battery recycling facilities[131][132] Operational Developments - The company is focused on increasing domestic U.S. production of battery materials and developing new technologies for battery metal extraction and recycling[19] - The Company is advancing major lithium projects, which require significant time and resources, potentially straining managerial and human resources[189] - The Company is working on a $115 million project to design and construct a commercial-scale refinery to produce 30,000 MT of battery-grade lithium hydroxide per year[128] - The Company has been selected for a $150 million grant for the construction of a new lithium-ion battery recycling facility[57] - ABTC completed the construction and commissioning of its lithium hydroxide pilot plant, supported by a $4.5 million grant from the U.S. Department of Energy[129] Miscellaneous - The Company recorded an impairment charge of $10.3 million on assets held-for-sale, which had a carrying amount of $18.6 million[67] - The Company recognized stock-based compensation expense of $3.2 million for the three months ended September 30, 2024, compared to $3.4 million in the same period of 2023[110] - The Company has approximately $8.5 million of unamortized expenses related to outstanding equity compensation awards to be recognized over a remaining weighted-average period of 2.6 years[111] - The Company issued 3,548,426 warrants during the three months ended September 30, 2024, with 898,426 of those purchased by employees[104] - The balance of warrants as of September 30, 2024, was 9,394,469, with a weighted average exercise price of $8.55 and an aggregate intrinsic value of $248,390[105]
American Battery Technology pany(ABAT) - 2025 Q1 - Quarterly Report