KULR Technology (US:KULR)2022-08-15 23:55Financial Data and Key Metrics Changes - The company reported revenue of $588,000 for Q2 2022, a decrease of 6% compared to $628,000 in Q2 2021, primarily due to lower contract services and product sales revenues [24] - SG&A expenses increased to $4.3 million in Q2 2022 from $2.7 million in Q2 2021, reflecting a 59% increase due to additional marketing, consulting fees, and expansion costs [25] - R&D expenses rose 183% from $353,000 in Q2 2021 to $999,000 in Q2 2022, driven by headcount increases and new automated testing equipment [26] - Loss from operations increased 79% from $2.9 million in Q2 2021 to $5.2 million in Q2 2022 [27] - Net loss increased by 74% from $3 million in Q2 2021 to $5.3 million in Q2 2022, with a net loss per share of $0.05 compared to $0.06 in the prior year [28] - Cash balances as of June 30, 2022, were $13 million, up from $12.2 million a year earlier, with a $50 million standby equity purchase agreement established [29] Business Line Data and Key Metrics Changes - The company has expanded its sales funnel by 30%, now exceeding 300 customers, and secured four major commercial accounts for safe case products with deployment trials underway [22] - Significant customer interest has been noted across various sectors, including energy storage, electric aviation, battery recycling, and e-mobility [10] Market Data and Key Metrics Changes - The company has gained access to commercial partners through a shipping certification with UPS, allowing for the shipment of lithium-ion batteries using KULR's safe case products [12] - The partnership with E-One Moli Energy Corporation aims to secure 75 megawatt-hours of battery supply for eVTOL and high-performance e-mobility applications [14] Company Strategy and Development Direction - The company is focused on transforming into a leading platform for battery safety and sustainability, with plans to upsell and cross-sell components of its comprehensive platform [10] - KULR is developing a universal modular battery architecture and has filed two provisional patents related to high-energy cathodes [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in a ramp-up in sales volume despite potential supply chain challenges, anticipating revenue recognition from customer engagements in the coming quarters [11] - The company is optimistic about its growth trajectory, particularly in the context of the circular electrification economy [11] Other Important Information - KULR successfully completed ISO 9001 certification, enhancing its manufacturing excellence and operational controls [17] - The company is expanding its workforce, hiring additional engineers and sales personnel to support its growth [20][21] Q&A Session Summary Question: Impact of inflation on cost pressures and gross margins - Management acknowledged that inflation has negatively impacted logistics costs but has mitigated this by moving manufacturing to Mexico, which has reduced logistics costs [34] Question: Update on CellCheck rollout and market interest - Management indicated that industrial storage is currently the primary focus for CellCheck, with a long cycle for market rollout due to the need for integration with partners [37] Question: Build plan for secured batteries and early applications - Management emphasized the importance of high-quality battery cells and outlined plans to target aerospace, defense, and industrial power equipment markets [41][42] Question: Revenue expectations from Volta order - Management refrained from commenting on specific revenue amounts but indicated expectations for volume ramp-up in the second half of 2022 [44] Question: Follow-on order from Lockheed and potential products - Management confirmed ongoing support for Lockheed's advanced battery systems but did not disclose specific revenue figures [46] Question: Prospects for carbon fiber products in sensing applications - Management highlighted ongoing development of carbon fiber substrate materials for various applications, with testing expected in Q3 2022 [50][52]