Origin Materials(US:ORGN)2025-08-14 20:46PART I. — FINANCIAL INFORMATION This section presents the unaudited financial statements and management's analysis of the company's financial performance and condition Item 1. Condensed Consolidated Financial Statements (unaudited) The company reported an increased net loss and decreased total assets, with significant 'going concern' risk due to funding needs Condensed Consolidated Balance Sheets Total assets decreased to $348.4 million by June 30, 2025, driven by reduced cash and marketable securities, while equity declined due to net loss Condensed Consolidated Balance Sheet Data (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $35,295 | $56,307 | | Marketable securities | $34,106 | $46,613 | | Total current assets | $101,584 | $139,174 | | Property, plant, and equipment, net | $229,068 | $203,919 | | Total assets | $348,377 | $378,027 | | Liabilities & Equity | | | | Total current liabilities | $15,941 | $12,549 | | Total liabilities | $37,251 | $39,662 | | Accumulated deficit | ($77,315) | ($38,127) | | Total stockholders' equity | $311,126 | $338,365 | Condensed Consolidated Statements of Operations and Comprehensive Loss Total revenues decreased by 19% to $11.2 million, resulting in an increased net loss of $39.2 million due to an asset impairment charge Statement of Operations Highlights (in thousands, except per share data) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenues | $11,243 | $13,858 | | Loss from operations | ($47,589) | ($36,254) | | Impairment of assets | $16,610 | $0 | | Net loss | ($39,188) | ($33,412) | | Net loss per share, basic & diluted | ($0.27) | ($0.23) | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities improved to $15.7 million, though overall cash and equivalents decreased by $21.0 million to $35.3 million Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($15,733) | ($31,697) | | Net cash (used in) provided by investing activities | ($665) | $2,205 | | Net cash (used in) provided by financing activities | ($4,485) | $6,806 | | Net decrease in cash and cash equivalents | ($21,012) | ($19,818) | | Cash and cash equivalents end of the period | $35,295 | $55,684 | Notes to Unaudited Condensed Consolidated Financial Statements Notes highlight a 'going concern' warning due to recurring losses and an accumulated deficit, alongside a $16.6 million asset impairment charge - The company has a 'going concern' warning due to its financial condition, including $69.4 million in cash and marketable securities, an accumulated deficit of $77.3 million, and recurring net losses. Management states these conditions raise substantial doubt about the company's ability to continue for the next twelve months26 - During the first six months of 2025, the company recorded a $16.6 million impairment charge after terminating an agreement for materials conversion. This was related to discharging advance payments and future commitments under a take-or-pay agreement44101 - The company is involved in a putative securities class action and two shareholder derivative complaints related to its August 9, 2023 announcement about delays in its Origin 2 project. The company cannot predict the outcome or financial impact at this preliminary stage106107108 - The company has purchase commitments for equipment for its PET closures business totaling approximately $22.4 million, subject to milestone achievements. As of June 30, 2025, payments of $27.1 million had already been made99 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses decreased revenue, a strategic review for shareholder value, and reiterates the 'going concern' risk without additional financing - In August 2025, the Board initiated a broad strategic review to maximize shareholder value, considering alternatives such as a business combination, asset divestiture, technology licensing, merger, or sale of the company121 - The company faces substantial doubt about its ability to continue as a going concern. Absent substantial additional financing by the end of 2025, management expects to begin scaling back or ceasing certain operations and reducing headcount159162 - The company experienced delays in its CapFormer lines build-out due to slower subcomponent delivery and tariffs, leading to an expected substantial reduction in manufacturing output for 2026127 Results of Operations Revenues decreased 19% to $11.2 million, while operating expenses rose 31% due to a $16.6 million asset impairment charge Comparison of Six Months Ended June 30, 2025 and 2024 (in thousands) | Line Item | 2025 | 2024 | Variance $ | Variance % | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $11,243 | $13,858 | ($2,615) | (19)% | | Research and development | $6,579 | $10,211 | ($3,632) | (36)% | | General and administrative | $19,199 | $21,264 | ($2,065) | (10)% | | Impairment of assets | $16,610 | $0 | $16,610 | 100% | | Loss from operations | ($47,589) | ($36,254) | ($11,335) | 31% | | Net loss | ($39,188) | ($33,412) | ($5,776) | 17% | Liquidity, Capital Resources and Going Concern The company holds $69.4 million in liquidity but faces substantial 'going concern' doubt, requiring significant additional capital for its growth strategy - The company's liquidity position as of June 30, 2025, was $69.4 million in cash, cash equivalents, and marketable securities158 - Management has concluded there is substantial doubt about the company's ability to continue as a going concern for a period of twelve months from the issuance of the financial statements159 - The company requires substantial additional project financing to execute its growth strategy, particularly for its PET closures manufacturing lines, and is evaluating strategies including equity, debt, and strategic partnerships160162 Item 3. Quantitative and Qualitative Disclosures About Market Risk The company is a 'smaller reporting company' and is therefore not required to provide the information requested under this item - As a 'smaller reporting company,' Origin Materials is not required to provide quantitative and qualitative disclosures about market risk174 Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective at the reasonable assurance level176 - No material changes to the company's internal control over financial reporting occurred during the six months ended June 30, 2025177 PART II. — OTHER INFORMATION This section covers legal proceedings, risk factors, and other miscellaneous disclosures relevant to the company's operations Item 1. Legal Proceedings The company is defending against a securities class action and shareholder derivative complaints related to Origin 2 project delays - The company is defending against a securities class action lawsuit and two shareholder derivative complaints related to its August 2023 announcement of delays to the Origin 2 project106107179 Item 1A. Risk Factors Key risks include 'going concern' doubt, history of losses, commercialization challenges, supply chain issues, and potential Nasdaq delisting - There is substantial doubt about the company's ability to continue as a going concern, and a failure to obtain necessary capital may force it to delay, limit, or terminate operations180182 - The company has a history of losses, its future profitability is uncertain, and it has not yet produced any of its products in large commercial quantities180187203 - The company's common stock is at risk of being delisted from Nasdaq for failing to meet the minimum $1.00 bid price requirement, which could adversely affect liquidity and its ability to raise capital184331 - International trade disputes and tariffs, particularly on goods from Europe and Switzerland, are increasing the cost of capital equipment (CapFormers) and could adversely affect the business268270271 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities during the reporting period - None343 Item 3. Defaults Upon Senior Securities There were no defaults upon senior securities during the reporting period - None344 Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable345 Item 5. Other Information General Counsel Joshua Lee's Rule 10b5-1 stock trading plan, initiated in September 2024, was terminated in June 2025 - On September 13, 2024, General Counsel Joshua Lee entered into a Rule 10b5-1 stock trading plan for the sale of up to 60,000 shares. This plan was terminated on June 9, 2025346 Item 6. Exhibits This section lists exhibits filed with the Form 10-Q, including corporate governance documents and officer certifications