MP Materials(MP) - 2022 Q1 - Quarterly Report

Financial Performance - Total revenue for Q1 2022 was $166.258 million, a significant increase of 177.5% compared to $59.971 million in Q1 2021[21] - Net income for Q1 2022 reached $85.551 million, up 431.5% from $16.119 million in Q1 2021[21] - Operating income for Q1 2022 was $115.024 million, compared to $21.709 million in Q1 2021, reflecting a growth of 429.5%[21] - The company reported a basic earnings per share of $0.49 for Q1 2022, compared to $0.10 for Q1 2021[21] - For the three months ended March 31, 2022, net income was $85.6 million, compared to $16.1 million for the same period in 2021, representing a significant increase of 431%[89] - Basic earnings per share (EPS) for Q1 2022 was $0.49, up from $0.10 in Q1 2021, while diluted EPS was $0.45 compared to $0.09 in the prior year[89] - Adjusted EBITDA for the same period was $132.257 million, representing a 301% increase from $33.000 million in 2021[129] - Adjusted Net Income for Q1 2022 reached $96,337,000, compared to $23,177,000 in Q1 2021, reflecting a strong year-over-year growth[171] - Adjusted Diluted EPS for Q1 2022 was $0.50, up from $0.13 in Q1 2021, demonstrating substantial earnings growth per share[174] - Free Cash Flow for Q1 2022 was $71,169,000, a significant recovery from a negative $9,963,000 in Q1 2021, indicating improved cash generation capabilities[177] Revenue and Sales - Total product sales from agreements with Shenghe were $155.0 million in Q1 2022, compared to $59.7 million in Q1 2021, indicating a growth of 160%[90] - For the three months ended March 31, 2022, product sales increased to $161.755 million, a 171% increase from $59.739 million in the same period of 2021[129] - REO sales volume rose by 20% to 11,706 MT in Q1 2022, compared to 9,793 MT in Q1 2021[101] - The realized price per REO MT surged by 135% to $13,818 in Q1 2022, compared to $5,891 in Q1 2021[101] - Total Value Realized for Q1 2022 was $161,755,000, up from $59,739,000 in Q1 2021, resulting in a realized price per REO MT of $13,818 compared to $5,891[160] Assets and Cash Flow - Cash and cash equivalents increased to $1.233 billion as of March 31, 2022, from $1.179 billion at the end of 2021[19] - Total assets rose to $1.987 billion as of March 31, 2022, compared to $1.890 billion at the end of 2021, marking an increase of 5.2%[19] - Total stockholders' equity increased to $1.090 billion as of March 31, 2022, up from $1.009 billion at the end of 2021[19] - Cash provided by operating activities for Q1 2022 was $120.971 million, a substantial increase from $9.335 million in Q1 2021[26] - Net cash provided by operating activities increased by $111.6 million to $120.97 million for Q1 2022, reflecting increased product sales[156] - Net cash used in investing activities increased by $30.6 million to $49.8 million for Q1 2022, mainly due to capital expenditures for the Stage II optimization project[157] Production and Operations - REO production volume increased by 10% to 10,828 metric tons (MT) in Q1 2022, up from 9,849 MT in Q1 2021[101] - The company achieved approximately 95% uptime in production, significantly enhancing production efficiency[112] - Production cost per REO MT increased from $1,475 in Q1 2021 to $1,594 in Q1 2022, primarily due to higher payroll costs and employee headcount[134] - Selling, general and administrative expenses rose by $2.5 million, or 28%, primarily due to increases in personnel costs and stock-based compensation[137] Investments and Projects - The company is currently enhancing its Mountain Pass facility to enable the separation of individual rare earth elements, part of the Stage II optimization project[29] - Construction has begun on a new manufacturing facility in Fort Worth, Texas, as part of the Stage III downstream expansion strategy[29] - Capitalized expenditures for the three months ended March 31, 2022, were $68.0 million, compared to $27.3 million for the same period in 2021, reflecting increased investment in Stage II optimization and Stage III projects[51] - A $35 million contract was awarded by the Department of Defense to design and build a facility for processing heavy rare earth elements, establishing the first of its kind in the U.S.[118] - The company expects to incur approximately $500 million in capital costs in 2022 for the completion of various projects, including the HREE separation facility[147] Risk and Compliance - As of March 31, 2022, Shenghe accounted for over 90% of the company's product sales, indicating a significant concentration of risk[33] - The company has not experienced a reduction in production or sales due to the COVID-19 pandemic, although it has faced cost and schedule pressures on its Stage II optimization project[37] - The company is not currently a party to any material legal or governmental proceedings[185] - There have been no material changes to the risk factors disclosed in the Form 10-K for the year ended December 31, 2021[186] - The company reported no changes that materially affected internal control over financial reporting during the fiscal quarter[183]