CDTi Advanced Materials, Inc. Reports Third Quarter 2018 Financial Results
November 14 2018 - 4:05PM
Announces Plan to Delist from Nasdaq and
Deregister Its Common Stock
CDTi Advanced Materials, Inc. (Nasdaq: CDTI) (“CDTi” or “the
Company”), a leader in advanced catalyst materials technology,
reported today its financial results for the third quarter ended
September 30, 2018.
The company also announced that it will voluntarily delist its
common stock from The Nasdaq Stock Market and, based upon ownership
of its shares by fewer than 300 holders of record, deregister its
common stock under the Securities Exchange Act of 1934 and suspend
its public reporting obligations.
Matthew Beale, CDTi’s CEO, stated, “Our transition from a niche
manufacturer of emissions control solutions to a provider of
advanced materials technologies has yet to deliver its anticipated
revenue and cash flow potential. In order to best position
CDTi for long-term profitable growth, we undertook a thorough and
thoughtful review of our cost structure in light of our near and
mid-term revenue prospects, including costs associated with being a
Nasdaq listed and SEC reporting company. Our Board of
Directors concluded that the costs of maintaining the Nasdaq
listing and remaining a public reporting company, including costs
of compliance, the demands on management time and the Company
resources required to maintain its listed and registered status,
outweigh the benefits to the Company and its stockholders of
continued Nasdaq listing and SEC reporting. The Board voted
unanimously to voluntarily delist from Nasdaq and deregister under
the Exchange Act. This will enable us to better direct our
financial and management resources on the commercialization of our
high-performance catalysts solutions and technologies for the
automotive emissions control markets, and conserve cash while we
build long-term value in the company.”
The Company will file a Form 25 with the Securities and Exchange
Commission on or about November 26, 2018, and the Nasdaq delisting
is expected to become effective on or about December 6, 2018, at
which time trading on Nasdaq will cease. The common stock may
thereafter be eligible for quotation on the Pink tier of OTC
Markets Group if market makers commit to making a market in the
Company’s shares. The Company can provide no assurance that
trading in its common stock will continue on the OTC Markets Group
or otherwise.
After the Nasdaq delisting becomes effective, the Company will
file a Form 15 with the Securities and Exchange Commission on or
about December 10, 2018, at which time the Company anticipates that
its obligation to file periodic reports under the Exchange Act,
including annual, quarterly and current reports on Form 10-K, Form
10-Q and Form 8-K, respectively, will be suspended, and that all
requirements associated with being an Exchange Act-registered
company, including the requirement to file current and periodic
reports, will terminate permanently 90 days thereafter.
About CDTi Advanced Materials CDTi Advanced
Materials, Inc. (NASDAQ: CDTI) develops advanced materials
technology for the emissions control and other catalysis markets.
CDTi’s proprietary technologies provide high-value sustainable
solutions to reduce hazardous emissions from on- and off-road
combustion engine systems at significantly lower cost. With a
continuing focus on innovation-driven commercialization and global
expansion, CDTi’s breakthrough Powder-to-Coat (P2C™) approach
delivers those technologies to customers in a ready to use powder
form. Key technology platforms include Base Metal Activated Rhodium
Support (BMARS™), Synergized PGM (SPGM™), Zero PGM (ZPGM™) and
Spinel™. For more information, please visit www.cdti.com.
Forward-Looking StatementsCertain information
contained in this press release constitutes forward-looking
statements, including any statements that are not statements of
historical fact. You can identify these forward-looking statements
by the use of the words “believes”, “expects”, “anticipates”,
“plans”, “may”, “will”, “would”, “intends”, “estimates”, and other
similar expressions, whether in the negative or affirmative.
Forward-looking statements are based on a series of expectations,
assumptions, estimates and projections, which involve substantial
uncertainty and risk. In this document, the Company includes
forward-looking statements regarding the acceleration of the
Company’s business transformation into an advanced materials
company, global trends in the automotive and heavy duty diesel
markets, the Company’s future financial performance, the
performance of the Company’s technology, and the timing, process
and consequences of a Nasdaq delisting and Exchange Act
deregistration, all of which are subject to risks and uncertainties
that could cause our actual results and financial position to
differ materially. In general, actual results may differ
materially from those indicated by such forward-looking statements
as a result of risks and uncertainties, including, but not limited,
to (i) that the Company may not be able to (a) successfully
implement, or implement at all, its strategic priorities; (b)
streamline its operations or align its organization and
infrastructure with the anticipated business; (c) meet expectations
or projections; (d) decrease costs; (e) increase sales; (f) obtain
adequate funding; (g) retain or secure customers; (h) increase its
customer base; (i) protect its intellectual property; (j)
successfully evolve into an advanced materials supplier or, even if
successful, increase profitability; (k) successfully market new
products; (l) obtain product verifications or approvals; (m)
attract or retain key personnel; (n) validate, optimize and scale
our powder-to-coat capability; or (o) realize benefits from
investments; (ii) funding for and enforcement and tightening of
emissions controls, standards and regulations; (iii) prices of PGM
and rare earth metals; (iv) royalty and other restrictions on
sales in certain Asian countries; (v) supply disruptions or
failures; (vi) regulatory, marketing and competitive factors; (vii)
environmental harm or damages; and (viii) other risks and
uncertainties discussed or referenced in the Company’s filings with
the Securities and Exchange Commission, including its most recent
Annual Report on Form 10-K and any subsequent periodic reports on
Form 10-Q and Form 8-K. In addition, any forward-looking statements
represent the Company’s estimates only as of the date of such
statements and should not be relied upon as representing the
Company’s estimates as of any subsequent date. The Company
specifically disclaims any obligation to update forward-looking
statements. All forward-looking statements in this press release
are qualified in their entirety by this cautionary statement.
Contact Information: Moriah
Shilton, Cathy Mattison or Kirsten ChapmanLHA Investor Relations +1
415 433 3777cdti@lhai.com
[Tables to follow]
|
CDTi ADVANCED MATERIALS,
INC.Condensed Consolidated Statements of
Operations(in thousands, except per share
amounts)(unaudited) |
|
|
Three Months
Ended September 30, |
|
|
Nine Months
Ended September 30, |
|
2018 |
% of Revenues |
|
2017 |
% of Revenues |
|
2018 |
% of Revenues |
|
2017 |
% of Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Emission control systems |
$ |
1,821 |
90
% |
|
$ |
3,022 |
87
% |
|
$ |
5,539 |
83
% |
|
$ |
9,658 |
89
% |
Technology and advanced materials |
204 |
10 % |
|
454 |
13 % |
|
1,115 |
17 % |
|
1,223 |
11 % |
Revenues |
$ |
2,025 |
100
% |
|
$ |
3,476 |
100
% |
|
$ |
6,654 |
100
% |
|
$ |
10,881 |
100
% |
Gross profit |
908 |
45
% |
|
667 |
19
% |
|
2,711 |
41
% |
|
2,419 |
22
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Research and development |
520 |
|
|
1,085 |
|
|
1,840 |
|
|
2,996 |
|
Selling, general and administrative |
1,233 |
|
|
1,855 |
|
|
3,967 |
|
|
6,462 |
|
Severance and other charges |
— |
|
|
235 |
|
|
— |
|
|
(384) |
|
Total operating expenses |
1,753 |
|
|
3,175 |
|
|
5,807 |
|
|
9,074 |
|
Loss from continuing operations |
(845) |
|
|
(2,508) |
|
|
(3,096) |
|
|
(6,655) |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
— |
|
|
(95) |
|
|
— |
|
|
(235) |
|
Loss on extinguishment of debt |
— |
|
|
— |
|
|
— |
|
|
(194) |
|
Gain (loss) on change in fair value of
liability-classified warrants |
57 |
|
|
738 |
|
|
591 |
|
|
404 |
|
Gain on sale of DuraFit |
— |
|
|
805 |
|
|
— |
|
|
805 |
|
Other expense, net |
43 |
|
|
(149) |
|
|
95 |
|
|
(67) |
|
Total other income (expense) |
100 |
|
|
1,299 |
|
|
686 |
|
|
713 |
|
Loss from continuing operations before income
taxes |
(745) |
|
|
(1,209) |
|
|
(2,410) |
|
|
(5,942) |
|
Income tax expense (benefit) from continuing
operations |
17 |
|
|
(119) |
|
|
758 |
|
|
49 |
|
Net loss from continuing operations |
(762) |
|
|
(1,090) |
|
|
(3,168) |
|
|
(5,991) |
|
Net (loss) income from discontinued
operations |
(645) |
|
|
730 |
|
|
(486) |
|
|
2,149 |
|
Net loss |
$ |
(1,407) |
|
|
$ |
(360) |
|
|
$ |
(3,654) |
|
|
$ |
(3,842) |
|
Foreign currency translation adjustments |
(52) |
|
|
129 |
|
|
(170) |
|
|
350 |
|
Comprehensive loss |
$ |
(1,459) |
|
|
$ |
(231) |
|
|
$ |
(3,824) |
|
|
$ |
(3,492) |
|
Basic and diluted net (loss) income per common
share: |
|
|
|
|
|
|
|
|
|
|
|
Net loss from continuing operations |
$ |
(0.20) |
|
|
$ |
(0.35) |
|
|
$ |
(0.93) |
|
|
$ |
(1.90) |
|
Net (loss) income from discontinued operations -
Basic |
$ |
(0.17) |
|
|
$ |
0.24 |
|
|
$ |
(0.14) |
|
|
$ |
0.68 |
|
Net (loss) income from discontinued operations -
Diluted |
$ |
(0.17) |
|
|
$ |
0.24 |
|
|
$ |
(0.14) |
|
|
$ |
0.68 |
|
Net loss |
$ |
(0.37) |
|
|
$ |
(0.11) |
|
|
$ |
(1.07) |
|
|
$ |
(1.22) |
|
Weighted average shares outstanding – basic |
3,839 |
|
|
3,152 |
|
|
3,394 |
|
|
3,145 |
|
Weighted average shares outstanding –
diluted |
3,839 |
|
|
3,152 |
|
|
3,394 |
|
|
3,175 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CDTi ADVANCED MATERIALS,
INC.Condensed Consolidated Balance
Sheet(in thousands, except share and per share
amounts)(unaudited) |
|
|
September 30, 2018 |
|
December 31, 2017 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash |
$ |
3,254 |
|
$ |
2,807 |
Accounts
receivable, net |
1,320 |
|
1,877 |
Inventories |
1,383 |
|
1,355 |
Prepaid
expenses and other current assets |
123 |
|
656 |
Current
assets of discontinued operations |
216 |
|
1,524 |
Total
current assets |
6,296 |
|
8,219 |
Property and equipment,
net |
343 |
|
414 |
Intangible assets,
net |
929 |
|
1,051 |
Deferred tax
assets |
10 |
|
644 |
Other assets |
80 |
|
62 |
Assets of discontinued
operations |
105 |
|
424 |
Total
assets |
$ |
7,763 |
|
$ |
10,814 |
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts
payable |
$ 1,452 |
|
$ 1,684 |
Accrued
expenses and other current liabilities |
940 |
|
1,539 |
Income
taxes payable |
811 |
|
789 |
Liabilities of discontinued operations |
888 |
|
2,421 |
Total
current liabilities |
4,091 |
|
6,433 |
Liabilities of
discontinued operations |
674 |
|
— |
Total liabilities |
4,765 |
|
6,433 |
|
|
|
|
Stockholders’
equity: |
|
|
|
Preferred stock, par
value $0.01 per share: authorized 100,000; no shares issued and
outstanding |
— |
|
— |
Common stock, par value
$0.01 per share: authorized 50,000,000; issued and outstanding
4,070,533 and 3,160,747 shares at September 30, 2018 and
December 31, 2017, respectively |
202 |
|
158 |
Additional paid-in
capital |
240,851 |
|
238,455 |
Accumulated other
comprehensive loss |
(6,055) |
|
(5,886) |
Accumulated
deficit |
(232,000) |
|
(228,346) |
Total stockholders’
equity |
2,998 |
|
4,381 |
Total liabilities and
stockholders’ equity |
$ |
7,763 |
|
$ |
10,814 |
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