– Origin 1 On Track for Mechanical Completion
by Year-End 2022, Capital Budget Unchanged
– Origin 2 Construction Timeline, Budget, and
Financing Unchanged –
– Customer Demand is Strong and Broad Based,
Increased Contracted Offtake Agreements and Capacity Reservations
to $9.0 Billion –
– Maintains 2022 Adjusted EBITDA and Capital
Expenditure Outlook
Origin Materials, Inc. (“Origin,” “Origin Materials,” or the
“Company”) (Nasdaq: ORGN, ORGNW), the world’s leading carbon
negative materials company with a mission to enable the world’s
transition to sustainable materials, today announced financial
results for its third quarter ended September 30, 2022.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20221103006065/en/
“I am incredibly proud of our team’s continued progress and
execution on our mission to enable the world’s transition to
sustainable materials. We remain well-capitalized and on track for
mechanical completion of Origin 1 by year-end 2022, a considerable
accomplishment despite the pandemic and related supply-chain
headwinds. For Origin 2, the previously disclosed capital budget,
construction timeline, and financing are unchanged. As the world
moves aggressively to a zero-carbon future, we continue to see
robust demand for our industry-leading technology as well as
increasing regulatory support for sustainable solutions that can
address the world’s environmental challenges. Our efforts to
commercialize the business have resulted in increased offtake
agreements and capacity reservations from our customers and
partners to $9.0 billion, a more than ninefold increase since our
announcement to become a public company in February 2021,” said
Rich Riley, Co-Chief Executive Officer of Origin.
Key Company Third Quarter Highlights Origin Materials has
increased its total signed offtake agreements and capacity
reservations to $9.0 billion as of today, up from $8.1 billion in
August 2022. The additional demand complements Origin’s existing
partnerships and customer relationships with industry leaders
including Danone, Nestlé Waters, PepsiCo, Ford Motor Company,
Mitsubishi Gas Chemical, Kolon Industries, PrimaLoft, Solvay,
Mitsui & Co., Ltd., Minafin Group, LVMH Beauty, Revlon,
Mitsubishi Chemical Group, Kuraray, Intertex World Resources, and
ATC Plastics.
In addition, the Company has previously announced that it won
the 2022 Alternative Fuels & Chemicals Coalition (AFCC) Global
Biobased Economy Performance Award for Origin's outstanding
performance and achievements in the commercialization and scale-up
of its patented technology platform. Sponsored by the Industrial
Biotechnology Journal, the official journal of AFCC, the award is
given annually to recognize companies that are advancing science
and contributing to the production and commercialization of
industrial biotechnology products.
Origin 1 and Origin 2 Financing and Construction Update
The Company maintains that the previously disclosed Origin 1
construction timeline is on track, with mechanical completion
expected by the end of 2022, and plant commissioning complete by
the end of Q1 2023 with start-up beginning shortly thereafter. The
Company also maintains its previously disclosed capital budget for
Origin 1 of $125 million to $130 million.
During the third quarter, the Company continued to strengthen
its Origin 1 operations leadership team and operations staff. The
Company has made progress assembling the piping and electrical
systems. All major equipment has been delivered including power
distribution building, control room, storage tanks and hydrothermal
carbon ("HTC") recovery equipment. The Company substantially
completed the construction of the HTC building, which houses
equipment used in the separation of HTC, and completed the biomass
building, which will store sustainable wood residues, and installed
the storage tanks.
A new video marking construction progress for Origin 1 is
embedded into this press release and is also available on Origin’s
Investor Relations site:
https://investors.originmaterials.com/.
The previously disclosed Origin 2 capital budget and
construction timeline are unchanged. Front end design of the plant
continues to be underway with detailed engineering set to begin in
2023. The Company maintains that its financing assumptions for
Origin 2 are reasonable and achievable, with Origin 2 fully funded
from its existing cash on hand and previously indicated traditional
project financing sources. Origin continues to work with leading
financial institutions on other forms of traditional private
financing and federal loan programs, including through the U.S.D.A.
and Department of Energy. In February, the State of Louisiana,
pending finalization, awarded a Private Activity Bond volume cap
allocation of $400 million to the Company for its selection of
Geismar, Louisiana as the site of Origin 2. The Company also
expects to receive more than $100 million in pending state and
local incentives for Origin 2.
Results for Third Quarter 2022 Cash, cash equivalents and
marketable securities were $362.2 million as of September 30,
2022.
Operating expenses for the third quarter were $9.7 million
compared to $7.1 million in the prior-year period.
Net income was $8.3 million for the third quarter compared to
net income of $27.9 million in the prior-year period.
Adjusted EBITDA loss was $8.4 million for the third quarter
compared to a loss of $5.7 million in the prior-year period.
Shares outstanding as of September 30, 2022 were 142.7 million
including 4.5 million shares held by a certain stockholder that are
subject to forfeiture based on share price performance targets
previously disclosed in our filings.
Full Year 2022 Outlook Based on current business
conditions, business trends and other factors, the Company is
maintaining Adjusted EBITDA and its previously updated capital
spending estimate for fiscal year 2022:
- Adjusted EBITDA loss of up to $36 million
- Capital spending is expected to be up to $175 million
For a reconciliation of a non-GAAP figure to the applicable GAAP
figure please see the table captioned ‘Reconciliation of GAAP and
Non-GAAP Results' set forth at the end of this press release. These
expectations do not consider, or give effect to, among other
things, unforeseen events, including changes in global economic
conditions.
Webcast and Conference Call Information Company
management will host a webcast and conference call on November 3,
2022, at 5:00 p.m. Eastern Time, to discuss the Company's financial
results.
Interested investors and other parties can listen to a webcast
of the live conference call and access the Company’s third quarter
update presentation by logging onto the Investor Relations section
of the Company's website at
https://investors.originmaterials.com/.
The conference call can be accessed live over the phone by
dialing 1-888-999-3182 (domestic) or +1-848-280-6330
(international). A telephonic replay will be available
approximately two hours after the call by dialing 1-844-512-2921,
or for international callers, +1-412-317-6671. The conference ID
for the live call and pin number for the replay is 11152434. The
replay will be available until 11:59 p.m. Eastern Time on November
17, 2022.
About Origin Materials, Inc. Headquartered in West
Sacramento, Origin Materials is the world's leading carbon negative
materials company. Origin’s mission is to enable the world’s
transition to sustainable materials. For over a decade, Origin has
developed a platform for turning the carbon found in inexpensive,
plentiful, non-food biomass such as sustainable wood residues into
useful materials while capturing carbon in the process. Origin’s
patented technology platform can help revolutionize the production
of a wide range of end products, including clothing, textiles,
plastics, packaging, car parts, tires, carpeting, toys, and more
with a ~$1 trillion addressable market. In addition, Origin’s
technology platform is expected to provide stable pricing largely
decoupled from the petroleum supply chain, which is exposed to more
volatility than supply chains based on sustainable wood residues.
Origin’s patented drop-in core technology, economics and carbon
impact are supported by a growing list of major global customers
and investors. For more information, visit
www.originmaterials.com.
Non-GAAP Financial Information To supplement the
Company’s financial results presented in accordance with generally
accepted accounting principles in the United States ("U.S. GAAP"),
the Company also uses non-GAAP financial measures, including
adjusted EBITDA, as supplemental measures to review and assess the
Company’s operating performance. Adjusted EBITDA is defined as net
income or loss adjusted for (i) stock-based compensation expense,
(ii) depreciation and amortization, (iii) interest income, (iv)
interest expense, net of capitalized interest, (v) change in fair
value of derivative liability, (vi) change in fair value of
warrants liability, (vii) change in fair value of earnout
liability, (viii) professional fees related to completed mergers,
and (ix) other income, net. The Company believes that these
non-GAAP financial measures provide useful information about the
Company’s operating results, enhance the overall understanding of
the Company’s past performance and future prospects and allow for
greater visibility with respect to key metrics used by the
Company’s management in its financial and operational
decision-making.
Non-GAAP financial measures are not defined under U.S. GAAP and
are not presented in accordance with U.S. GAAP. These non-GAAP
financial measures have limitations as analytical tools, and when
assessing the Company’s operating performance, investors should not
consider them in isolation. In addition, calculations of this
non-GAAP financial information may be different from calculations
used by other companies, and therefore comparability may be
limited.
The Company mitigates these limitations by reconciling the
non-GAAP financial measures to the most comparable U.S. GAAP
performance measures, all of which should be considered when
evaluating our performance.
For more information on this non-GAAP financial measure, please
see the table captioned “Reconciliation of GAAP and Non-GAAP
Results” set forth at the end of this press release.
Cautionary Note on Forward-Looking Statements This press
release contains certain forward-looking statements within the
meaning of the federal securities laws. Forward-looking statements
generally are accompanied by words such as “believe,” “may,”
“will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,”
“should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,”
“future,” “outlook,” and similar expressions that predict or
indicate future events or trends or that are not statements of
historical matters. These forward-looking statements include, but
are not limited to, statements regarding Origin Materials’ business
strategy, estimated total addressable market, access to traditional
financing sources, budget and timelines to complete Origin 1 and
Origin 2, ability to convert capacity reservations and offtake
agreements into revenue, ability to enter new end-markets, ability
to develop new product categories, commercial and operating plans,
product development plans, anticipated growth and projected
financial information and ability to realize the anticipated
benefits of any partnerships discussed in the press release. These
statements are based on various assumptions, whether or not
identified in this press release, and on the current expectations
of the management of Origin Materials and are not predictions of
actual performance. These forward-looking statements are provided
for illustrative purposes only and are not intended to serve as,
and must not be relied on as, a guarantee, an assurance, a
prediction, or a definitive statement of fact or probability.
Actual events and circumstances are difficult or impossible to
predict and will differ from assumptions. Many actual events and
circumstances are beyond the control of Origin Materials. These
forward-looking statements are subject to a number of risks and
uncertainties, including that Origin Materials may be unable to
successfully commercialize its products; the effects of competition
on Origin Materials’ business; the uncertainty of the projected
financial information with respect to Origin; disruptions and other
impacts to Origin’s business as a result of the evolving COVID-19
pandemic, Russia’s military intervention in Ukraine, and other
global health or economic crises; changes in customer demand; and
those factors discussed in the Quarterly Report on Form 10-Q filed
with the U.S. Securities and Exchange Commission on August 3, 2022
under the heading “Risk Factors,” and other documents Origin
Materials has filed, or will file, with the SEC. If any of these
risks materialize or our assumptions prove incorrect, actual
results could differ materially from the results implied by these
forward-looking statements. There may be additional risks that
Origin Materials presently does not know, or that Origin Materials
currently believes are immaterial, that could also cause actual
results to differ from those contained in the forward-looking
statements. In addition, forward-looking statements reflect Origin
Materials’ expectations, plans, or forecasts of future events and
views as of the date of this press release. Origin Materials
anticipates that subsequent events and developments will cause its
assessments to change. However, while Origin Materials may elect to
update these forward-looking statements at some point in the
future, Origin Materials specifically disclaim any obligation to do
so. These forward-looking statements should not be relied upon as
representing Origin Materials’ assessments of any date subsequent
to the date of this press release. Accordingly, undue reliance
should not be placed upon the forward-looking statements.
ORIGIN MATERIALS, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands,
except share and per share data)
September 30,
2022
(Unaudited)
December 31,
2021
ASSETS
Current assets
Cash and cash equivalents
$
102,965
$
46,637
Restricted cash
505
490
Marketable securities
258,733
397,458
Other receivables
3,537
2,612
Derivative asset
1,826
202
Prepaid expenses and other current
assets
5,237
3,774
Total current assets
372,803
451,173
Property, plant, and equipment, net
111,398
57,185
Operating lease right-of-use asset
3,023
1,782
Intangible assets, net
168
215
Other long-term assets
5,080
62
Total assets
$
492,472
$
510,417
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities
Accounts payable
$
7,646
$
2,451
Accrued expenses
5,352
973
Operating lease liability, current
599
280
Other liabilities, current
2,594
380
Derivative liability
—
103
Total current liabilities
16,191
4,187
Earnout liability
64,197
127,757
Canadian Government Research and
Development Program liability
6,269
6,762
Assumed common stock warrants
liability
37,250
52,860
Stockholder note
5,802
5,189
Related party other liabilities,
long-term
5,328
5,720
Operating lease liability
2,494
1,486
Other liabilities, long-term
2,911
2,946
Total liabilities
140,442
206,907
STOCKHOLDERS’ EQUITY
Preferred stock, $0.0001 par value,
10,000,000 shares authorized; no shares issued and outstanding as
of September 30, 2022 and December 31, 2021
—
—
Common stock, $0.0001 par value,
1,000,000,000 shares authorized; 142,703,935 and 141,301,569,
issued and outstanding as of September 30, 2022 and December 31,
2021, respectively (including 4,500,000 Sponsor Vesting Shares)
14
16
Additional paid-in capital
366,332
361,542
Retained earnings (Accumulated
deficit)
5,779
(56,797
)
Accumulated other comprehensive loss
(20,095
)
(1,251
)
Total stockholders’ equity
352,030
303,510
Total liabilities and stockholders’
equity
$
492,472
$
510,417
ORIGIN MATERIALS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In thousands, except share and per share
data)
2022
2021
2022
2021
Operating Expenses
Research and development
$
3,732
$
1,957
$
8,717
$
5,605
General and administrative
5,834
5,043
16,769
13,210
Depreciation and amortization
180
126
488
363
Total operating expenses and loss from
operations
9,746
7,126
25,974
19,178
Other (income) expenses
Interest income
(2,309
)
—
(6,077
)
—
Interest expense, net of capitalized
interest
—
—
—
2,839
Change in fair value of derivatives
(1,129
)
—
(1,725
)
1,426
Change in fair value of warrants
liability
1,419
(13,481
)
(15,610
)
7,363
Change in fair value of earnout
liability
(15,147
)
(21,511
)
(63,561
)
(67,008
)
Other income, net
(879
)
(27
)
(1,577
)
(651
)
Total other income, net
(18,045
)
(35,019
)
(88,550
)
(56,031
)
Net income
$
8,299
$
27,893
$
62,576
$
36,853
Other comprehensive income (loss)
Unrealized (loss) on marketable
securities
$
(1,403
)
$
—
$
(10,783
)
$
—
Foreign currency translation adjustment,
net of tax
(7,253
)
(1,068
)
(8,061
)
24
Total comprehensive income (loss)
$
(357
)
$
26,825
$
43,732
$
36,877
Net income per share, basic
$
0.06
$
0.20
$
0.46
$
0.41
Net income per share, diluted
$
0.06
$
0.20
$
0.44
$
0.39
Weighted-average common shares
outstanding, basic
138,061,829
136,749,956
137,348,180
89,244,640
Weighted-average common shares
outstanding, diluted
142,197,014
141,239,965
142,134,560
94,029,056
ORIGIN MATERIALS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
(in thousands)
2022
2021
Cash flows from operating
activities
Net income
$
62,576
$
36,853
Adjustments to reconcile net income to net
cash from operating activities:
Depreciation and amortization
488
362
Amortization on right-of-use asset
423
—
Stock-based compensation
3,719
4,808
Amortization of debt issuance costs
—
14
Accretion of debt discount
—
2,211
Change in fair value of derivatives
(1,725
)
1,426
Change in fair value of common stock
warrants liability
(15,610
)
(27,672
)
Change in fair value of preferred stock
warrants liability
—
35,035
Change in fair value of earnout
liability
(63,561
)
(67,008
)
Change in fair value of incremental
acquisition fee accrual
(35
)
—
Changes in operating assets and
liabilities:
Other receivables
(926
)
(214
)
Grants receivable
—
(16
)
Prepaid expenses and other current
assets
(1,464
)
(3,677
)
Other long-term assets
(5,019
)
—
Accounts payable
5,195
(1,063
)
Accrued expenses
4,380
3,173
Payments on operating lease
liabilities
(338
)
—
Other liabilities, current
2,214
—
Related party payable
221
152
Net cash used in operating
activities
(9,462
)
(15,616
)
Cash flows from investing
activities
Purchases of property, plant, and
equipment, net of grants
(57,825
)
(5,113
)
Capitalized interest on plant
construction
(133
)
—
Purchases of marketable securities
(2,584,027
)
—
Sales of marketable securities
2,587,649
—
Maturities of marketable securities
124,319
—
Net cash provided by (used in)
investing activities
69,983
(5,113
)
Cash flows from financing
activities
Proceeds from stockholders' notes payable,
net of debt issuance costs
—
11,707
Payment of short-term debt
—
(906
)
Proceeds from Canadian Government Research
and Development Program
—
287
Issuance of common stock
371
56
Business combination, net of issuance
costs paid
—
467,530
Net cash provided by financing
activities
371
478,674
Effects of foreign exchange rate changes
on the balance of cash and cash equivalents, and restricted cash
held in foreign currencies
(4,549
)
(41
)
Net increase in cash and cash
equivalents, and restricted cash
56,343
457,904
Cash and cash equivalents, and
restricted cash, beginning of the period
47,127
1,874
Cash and cash equivalents, and
restricted cash, end of the period
$
103,470
$
459,778
Origin Materials, Inc. Reconciliation
of GAAP and Non-GAAP Results
We believe that the presentation of Adjusted Earnings before
Interest, Taxes, Depreciation, and Amortization (Adjusted EBITDA)
is appropriate to provide additional information to investors about
our operating profitability adjusted for certain non-cash items,
non-routine items that we do not expect to continue at the same
level in the future, as well as other items that are not core to
our operations. Further, we believe Adjusted EBITDA provides a
meaningful measure of operating profitability because we use it for
evaluating our business performance, making budgeting decisions,
and comparing our performance against that of other peer companies
using similar measures.
We define Adjusted EBITDA as net income or loss adjusted for (i)
stock-based compensation expense, (ii) depreciation and
amortization, (iii) interest income, (iv) interest expense, net of
capitalized interest, (v) change in fair value of derivative
liabilities, (vi) change in fair value of warrants liability, (vii)
change in fair value of earnout liability, (viii) professional fees
related to completed mergers, and (ix) other income, net.
Three months ended
September 30,
Nine months ended
September 30,
(in thousands)
2022
2021
2022
2021
Net income
$
8,299
$
27,893
$
62,576
$
36,853
Stock based compensation
1,146
636
3,719
4,808
Depreciation and amortization
180
126
488
363
Interest income
(2,309
)
—
(6,077
)
—
Interest expense, net of capitalized
interest
—
—
—
2,839
Change in fair value of derivative
liabilities
(1,129
)
—
(1,725
)
1,426
Change in fair value of warrants
liability
1,419
(13,481
)
(15,610
)
7,363
Change in fair value of earnout
liability
(15,147
)
(21,511
)
(63,561
)
(67,008
)
Professional fees related to completed
mergers
—
640
—
640
Other income, net
(879
)
(27
)
(1,577
)
(651
)
Adjusted EBITDA
$
(8,420
)
$
(5,724
)
$
(21,767
)
$
(13,367
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221103006065/en/
Origin Materials Investors: ir@originmaterials.com
Media: media@originmaterials.com
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