Westwater Resources(WWR)2025-03-20 20:30Financial Performance - For the year ended December 31, 2024, the consolidated net loss from continuing operations was $12.7 million, or $0.22 per share, compared to a net loss of $7.8 million, or $0.15 per share in 2023, reflecting a $4.9 million increase in losses [255]. - Net loss increased to $12,657,000 in 2024 from $7,751,000 in 2023, representing a rise of about 63% [298]. - Basic and diluted loss per share rose from $0.15 in 2023 to $0.22 in 2024, an increase of approximately 47% [298]. - The Company recognized a total other expense of $1.2 million for the year ended December 31, 2024, compared to other income of $2.4 million in 2023 [389]. - The Company reported a net loss of $4.98 million for the battery-grade graphite segment in 2024, compared to a net loss of $5.97 million in 2023 [416]. Cash Flow and Liquidity - Net cash used in operating activities for the year ended December 31, 2024, was $5.8 million, a decrease of $5.6 million compared to 2023 [262]. - Cash and cash equivalents decreased significantly from $10,852,000 at the end of 2023 to $4,272,000 at the end of 2024, a drop of approximately 61% [302]. - As of December 31, 2024, the Company had cash balances of $4.3 million and current liabilities exceeded current assets [335]. - The Company expects to continue incurring cash losses due to construction activities at the Kellyton Graphite Plant until operations commence [336]. - The Company has relied on equity financings, debt financings, and asset sales since 2009 to fund its operations [339]. Production and Development - The anticipated annual offtake volume for CSPG natural graphite anode products is 10,000 mt in 2026 and 15,000 mt from 2027 to 2031 under the Offtake Agreement with FCA [242]. - Westwater has secured offtake agreements for 100% of its anticipated Phase I production capacity from the Kellyton Graphite Plant [244]. - The qualification line at the Kellyton Graphite Plant is expected to produce approximately 1 mt per day of CSPG once fully operational [250]. - The company continued construction activities related to Phase I of the Kellyton Graphite Plant during 2024 [303]. - The Company has received all necessary permits to complete the construction of Phase I of the Kellyton Graphite Plant, including air and stormwater permits [411]. Expenses and Costs - General and administrative expenses for the year ended December 31, 2024, were $10.0 million, an increase of approximately $0.2 million compared to the prior year [258]. - Operating expenses decreased from $13,271,000 in 2023 to $11,468,000 in 2024, a reduction of approximately 14% [298]. - Capital expenditures for 2024 were $6,146,000, down from $58,295,000 in 2023, indicating a significant reduction of about 90% [302]. - Product development expenses for the years ended December 31, 2024, and 2023, were $1.2 million and $2.9 million, respectively, indicating a decrease of approximately 58.6% year-over-year [326]. - Stock-based compensation expense for the year ended December 31, 2024, was $1.3 million, compared to $0.8 million in 2023, reflecting a 62.5% increase [383]. Assets and Liabilities - Total current assets decreased from $11,614,000 in 2023 to $4,863,000 in 2024, a decline of approximately 58% [297]. - Total liabilities increased from $9,388,000 in 2023 to $13,235,000 in 2024, marking a growth of about 41% [297]. - Total stockholders' equity fell from $140,443,000 in 2023 to $133,122,000 in 2024, a decrease of about 5% [300]. - The net book value of property, plant, and equipment increased to $137.868 million as of December 31, 2024, from $132.400 million as of December 31, 2023 [347]. - The Company reported accrued liabilities of $2.1 million, an increase of 24.1% from $1.7 million in 2023 [359]. Financing and Debt - The company has executed a term sheet for a $150 million secured debt facility to complete the construction of Phase I of the Kellyton Graphite Plant [251]. - A term sheet has been executed with a global financial institution for a secured debt facility, but no assurance can be given that financing will be available [271]. - The Company is exploring alternative project financing options, including project debt and joint ventures, to fund the construction of the Kellyton Graphite Plant [270]. - The Company has committed to purchase up to $30.0 million of its common stock under the 2024 Lincoln Park PA [340]. - The Company has approximately 9.5 million shares of common stock available for future sales under the 2024 Lincoln Park PA, with a total commitment of up to $30.0 million [377]. Inventory and Write-downs - The Company recognized a $1.0 million write-down of inventory for the year ended December 31, 2024, based on net realizable value [283]. - The Company values its inventory at the lower of cost or net realizable value, with write-downs reported as a component of costs applicable to sales [282]. - The company reported a write-down of raw material inventory of $1.0 million in 2024, while there was no write-down in 2023 [390]. - The Company completed agreements to sell a portion of its raw material inventory, recognizing sales of $3.6 million in 2024, up from $0.1 million in 2023 [389]. Regulatory and Market Considerations - The Company anticipates that U.S. regulations regarding graphite extraction may evolve but does not foresee any unique adverse impacts on its operations [407]. - The Company’s proprietary purification process for graphite is subject to a patent application filed with the U.S. Patent and Trademark Office [408]. - The company evaluates its long-lived assets for impairment when events indicate that carrying amounts may not be recoverable, considering significant negative impacts in market price or demand for graphite [316]. - The company’s estimates of future cash flows for impairment assessments require significant management judgment and are subject to risks and uncertainties [318]. - The Company has not recorded revenues from operations since 2009, raising substantial doubt about its ability to continue as a going concern [288].