Finalizing Funding Agreement for up to $50
Million with Export-Import Bank of the United States
Began Production of Second Energy Center for
Portland General Electric
Energy Warehouse Becomes First Operational
Long-Duration Energy Storage at an Airport
Exited Q2 with Cash and Short-Term
Investments over $74 Million; Expected to Carry ESS Well Into
2025
ESS Tech, Inc. (“ESS,” “ESS, Inc.” or the “Company”) (NYSE:
GWH), a leading manufacturer of long-duration energy storage
systems (LDES) for commercial and utility-scale applications, today
announced financial results for its second quarter ended June 30,
2024.
“ESS made significant headway in the business in the second
quarter and we continue to be encouraged by the growing imperative
for Long Duration Energy Storage to be coupled to renewables.
Importantly, outside funding is expected to play an important role
for not only our operational expansion, but also our partnership
with Sacramento Municipal Utility District, or SMUD. First, we are
close to finalizing an agreement for up to $50 million in funding
from the Export-Import Bank of the United States to expand our
manufacturing capacity and expect to add about $10 million to our
balance sheet in the second half alone for previously installed
capacity. Additionally, our long duration storage project with SMUD
has been granted $10 million by the California Energy Commission to
further our collaboration. Our progress with our projects across
numerous customers in the second quarter also reflects the
continued importance of our relationships. In Q2, our Energy
Warehouses started charging ground power units at Schiphol airport
in Amsterdam, were integrated into Burbank Water and Power’s
EcoCampus and connected to a 265 kW solar array, and was selected
by Indian Energy, the California Energy Commission and the
Department of Defense for testing to deliver energy security to
remote communities like tribal nations and military bases,” said
Eric Dresselhuys, CEO of ESS. “Although revenue in the second
quarter was lower than expected due to the timing of EW shipments
due to delays at a key partner, we expect this to resolve itself in
the coming weeks, allowing us to ship our products and recover
revenue in the third quarter.”
“On the Energy Center front, we remain on schedule with Portland
General Electric and continue to expect to ramp EC shipments in the
back half of the year. With the first EC currently cycling, we
began production of our second unit in July and expect these to be
connected to the grid by late 2024. In parallel, we have positioned
our operations to begin building the first ECs for commercial
deliveries to Tampa Electric and SMUD later this month. Our plan to
transition to volume manufacturing and shipments remains solidly on
track and we continue to expect to achieve our goal of growing our
revenue by three to four times in 2024.”
Recent Business Highlights
- An Energy Warehouse™ (EW) system at Schiphol Airport in
Amsterdam, the second largest airport in mainland Europe, became
the first iron flow battery to be operational at an airport. This
EW will be used to help advance Schiphol Airport’s sustainability
strategy and has now been tested on Schiphol’s AB platform. The EW
system has begun to be used to recharge Electric Ground Power Units
(E-GPU), which are intended to replace the diesel ground power
units currently used to supply electrical power to aircraft when
parked at airport gates.
- The California Energy Commission, or CEC, awarded a $10 million
grant to a long-duration battery storage project in partnership
with ESS and Sacramento Municipal Utility District, or SMUD. The
CEC funding will be used to demonstrate a 3.6 MW, 8-hour iron flow
battery project, with SMUD committing an additional $19.5 million
to cover additional other costs for the LDES project.
- We are finalizing the details to close agreement with the
Export-Import Bank of the United States, or EXIM, for up to $50
million in funding provided by the Make More in America Initiative.
This funding is long-term, low interest, and non-dilutive capital
to finance expanding manufacturing capacity, enabling ESS to
immediately add to our cash position, borrowing about $10 million
on a lookback basis for previously installed capacity. Later this
year, the funding is planned to be used for the addition of our
second manufacturing line, which is expected to triple our
production capacity.
- Indian Energy, a Native American-owned microgrid developer and
integrator, the CEC, and the Department of Defense together
selected ESS’ iron flow batteries to demonstrate the diverse
capabilities of LDES technologies for utility-scale, resilient
microgrids and their ability to deliver energy security to remote
communities like tribal nations and military bases. Over the coming
months, our project partners are expecting to demonstrate optimal
use cases in the California energy market, including solar peak
shifting and grid ancillary services, after which we expect our EW
to be placed into commercial operation.
- We began building our second EC in July, which we plan to
deploy beside the first EC, both for Portland General Electric. We
expect to start building and shipping our first commercial ECs in
the second half of 2024 for delivery to Tampa Electric and the
Sacramento Municipal Utility District, or SMUD.
- We filed our definitive proxy statement with the SEC on August
8, 2024 to execute a reverse split, following a listing notice from
the NYSE received in March. We will hold our special shareholders
meetings on August 23rd and, once having effected the split in late
August, we expect to be in compliance with the listing requirements
and will continue our operations as a publicly-listed company.
Conference Call Details
ESS will hold a conference call on Wednesday, August 14, 2024 at
5:00 p.m. EDT to discuss financial results for its second quarter
2024 ended June 30, 2024. Interested parties may join the
conference call beginning at 5:00 p.m. EDT on Wednesday, August 14,
2024 via telephone by calling (833) 470-1428 in the U.S., or for
international callers, by calling +1 (404) 975-4839 and entering
conference ID 366142. A telephone replay will be available until
August 21, 2024, by dialing (866) 813-9403 in the U.S., or for
international callers, +1 (929) 458-6194 with conference ID 167636.
A live webcast of the conference call will be available on ESS’
Investor Relations website at http://investors.essinc.com/.
A replay of the call will be available via the web at
http://investors.essinc.com/.
About ESS, Inc.
At ESS (NYSE: GWH), our mission is to accelerate global
decarbonization by providing safe, sustainable, long-duration
energy storage that powers people, communities and businesses with
clean, renewable energy anytime and anywhere it’s needed. As more
renewable energy is added to the grid, long-duration energy storage
is essential to providing the reliability and resiliency we need
when the sun is not shining and the wind is not blowing.
Our technology uses earth-abundant iron, salt and water to
deliver environmentally safe solutions capable of providing up to
12 hours of flexible energy capacity for commercial and
utility-scale energy storage applications. Established in 2011,
ESS, Inc. enables project developers, independent power producers,
utilities and other large energy users to deploy reliable,
sustainable long-duration energy storage solutions. For more
information visit www.essinc.com.
Use of Non-GAAP Financial Measures
In this press release and the accompanying earnings call, the
Company includes Non-GAAP Operating Expenses and Adjusted EBITDA,
which are non-GAAP performance measures that the Company uses to
supplement its results presented in accordance with U.S. GAAP. As
required by the rules of the Securities and Exchange Commission
(“SEC”), the Company has provided herein a reconciliation of the
non-GAAP financial measures contained in this press release and the
accompanying earnings call to the most directly comparable measures
under GAAP. The Company’s management believes Non-GAAP Operating
Expenses and Adjusted EBITDA are useful in evaluating its operating
performance and are similar measures reported by publicly-listed
U.S. companies, and regularly used by securities analysts,
institutional investors, and other interested parties in analyzing
operating performance and prospects. By providing these non-GAAP
measures, the Company’s management intends to provide investors
with a meaningful, consistent comparison of the Company’s
profitability for the periods presented. Adjusted EBITDA is not
intended to be a substitute for net income/loss or any U.S. GAAP
financial measure and, as calculated, may not be comparable to
other similarly titled measures of performance of other companies
in other industries or within the same industry. Further, Non-GAAP
Operating Expenses are not intended to be a substitute for GAAP
Operating Expenses or any U.S. GAAP financial measure and, as
calculated, may not be comparable to other similarly titled
measures of performance of other companies in other industries or
within the same industry.
The Company defines and calculates Non-GAAP Operating Expenses
as GAAP Operating Expenses adjusted for stock-based compensation
and other special items determined by management as they are not
indicative of business operations. The Company defines and
calculates Adjusted EBITDA as net loss before interest, other
non-operating expense or income, (benefit) provision for income
taxes, and depreciation and amortization, and further adjusted for
stock-based compensation and other special items determined by
management, including, but not limited to, fair value adjustments
for certain financial liabilities associated with debt and equity
transactions as they are not indicative of business operations.
Forward-Looking Statements
This communication contains certain forward-looking statements,
including statements regarding ESS and its management team’s
expectations, hopes, beliefs, intentions or strategies regarding
the future. The words “anticipate”, “believe”, “continue”, “could”,
“estimate”, “expect”, “intends”, “may”, “might”, “plan”,
“possible”, “potential”, “predict”, “project”, “should”, “will” and
“would” and similar expressions may identify forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. Examples of forward-looking
statements include, among others, statements regarding the
Company’s manufacturing plans, the Company’s order and sales
pipeline, the Company’s ability to execute on orders, the Company’s
ability to effectively manage costs, the Company’s partnerships
with third parties such as Amsterdam Airport Schiphol, Burbank
Water and Power, and the Sacramento Municipal Utility District and
the finalization of the EXIM loan. These forward-looking statements
are based on ESS’ current expectations and beliefs concerning
future developments and their potential effects on ESS. Many
factors could cause actual future events to differ materially from
the forward-looking statements in this communication. There can be
no assurance that the future developments affecting ESS will be
those that we have anticipated. These forward-looking statements
involve a number of risks, uncertainties (some of which are beyond
ESS control) or other assumptions that may cause actual results or
performance to be materially different from those expressed or
implied by these forward-looking statements, which include, but are
not limited to, continuing supply chain issues; delays,
disruptions, or quality control problems in the Company’s
manufacturing operations; the Company’s ability to hire, train and
retain an adequate number of manufacturing employees; issues
related to the shipment and installation of the Company’s products;
issues related to customer acceptance of the Company’s products;
issues related to the Company’s partnerships with third parties;
inflationary pressures; risk of loss of government funding for
customer projects; and the Company’s need to achieve significant
business growth to achieve sustained, long-term profitability.
Except as required by law, ESS is not undertaking any obligation to
update or revise any forward-looking statements whether as a result
of new information, future events or otherwise.
ESS Tech, Inc.
Condensed Statements of
Operations and Comprehensive Loss
(unaudited)
(in thousands, except share
and per share data)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Revenue:
Revenue
$
342
$
2,826
$
2,556
$
3,197
Revenue - related parties
6
1
530
$
2
Total revenue
348
2,827
3,086
$
3,199
Cost of revenue
11,748
—
22,874
—
Gross profit (loss)
(11,400
)
2,827
(19,788
)
3,199
Operating expenses:
Research and development
2,836
19,450
6,382
37,181
Sales and marketing
2,711
1,739
4,745
3,592
General and administrative
6,178
5,845
11,704
11,132
Total operating expenses
11,725
27,034
22,831
51,905
Loss from operations
(23,125
)
(24,207
)
(42,619
)
(48,706
)
Other income (expenses), net:
Interest income, net
1,052
1,330
2,291
2,582
Gain (loss) on revaluation of common stock
warrant liabilities
115
(115
)
115
573
Other income (expense), net
18
63
(37
)
721
Total other income, net
1,185
1,278
2,369
3,876
Net loss and comprehensive loss to
common stockholders
$
(21,940
)
$
(22,929
)
$
(40,250
)
$
(44,830
)
Net loss per share - basic and
diluted
$
(0.12
)
$
(0.15
)
$
(0.23
)
$
(0.29
)
Weighted-average shares used in per
share calculation - basic and diluted
175,758,584
154,900,330
175,136,561
154,514,265
ESS Tech, Inc.
Condensed Balance
Sheets
(unaudited)
(in thousands, except share
data)
June 30, 2024
December 31, 2023
Assets
Current assets:
Cash and cash equivalents
$
36,744
$
20,165
Restricted cash, current
906
1,373
Accounts receivable, net
981
1,990
Short-term investments
37,695
87,899
Inventory
4,425
3,366
Prepaid expenses and other current
assets
3,908
3,305
Total current assets
84,659
118,098
Property and equipment, net
17,758
16,266
Intangible assets, net
4,790
4,923
Operating lease right-of-use assets
2,195
2,167
Restricted cash, non-current
946
945
Other non-current assets
785
833
Total assets
$
111,133
$
143,232
Liabilities and stockholders'
equity
Current liabilities:
Accounts payable
$
5,833
$
2,755
Accrued and other current liabilities
9,669
10,755
Accrued product warranties
3,240
2,129
Operating lease liabilities, current
1,572
1,581
Deferred revenue, current
5,689
2,546
Total current liabilities
26,003
19,766
Operating lease liabilities,
non-current
884
957
Deferred revenue, non-current
—
3,835
Deferred revenue, non-current - related
parties
14,400
14,400
Common stock warrant liabilities
802
917
Other non-current liabilities
—
—
Total liabilities
42,089
39,875
Stockholders' equity:
Preferred stock ($0.0001 par value;
200,000,000 shares authorized, none issued and outstanding as of
June 30, 2024 and December 31, 2023)
—
—
Common stock ($0.0001 par value;
2,000,000,000 shares authorized, 176,822,039 and 174,211,911 shares
issued and outstanding as of June 30, 2024 and December 31, 2023,
respectively)
18
18
Additional paid-in capital
805,433
799,496
Accumulated deficit
(736,407
)
(696,157
)
Total stockholders' equity
69,044
103,357
Total liabilities and stockholders'
equity
$
111,133
$
143,232
ESS Tech, Inc.
Condensed Statements of Cash
Flows
(unaudited)
(in thousands)
Six Months Ended June
30,
2024
2023
Cash flows from operating
activities:
Net loss
$ (40,250)
$ (44,830)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
2,521
2,105
Non-cash interest income
(1,573)
(1,487)
Non-cash lease expense
658
604
Stock-based compensation expense
5,880
4,784
Inventory write-down and losses on
noncancellable purchase commitments
1,530
—
Change in fair value of common stock
warrant liabilities
(115)
(573)
Other non-cash (income) expenses, net
25
(33)
Changes in operating assets and
liabilities:
Accounts receivable, net
1,526
4,653
Inventory
(2,875)
—
Prepaid expenses and other current
assets
(555)
2,561
Accounts payable
1,925
(664)
Accrued and other current liabilities
(1,962)
(4,234)
Accrued product warranties
1,111
3,460
Deferred revenue
(1,209)
(3,189)
Operating lease liabilities
(768)
(689)
Net cash used in operating
activities
(34,131)
(37,532)
Cash flows from investing
activities:
Purchases of property and equipment
(1,565)
(3,440)
Maturities and purchases of short-term
investments, net
51,752
37,363
Net cash provided by investing
activities
50,187
33,923
Cash flows from financing
activities:
Payments on notes payable
—
(800)
Proceeds from stock options exercised
21
122
Repurchase of shares from employees for
income tax withholding purposes
(178)
(82)
Proceeds from contributions to Employee
Stock Purchase Plan
214
332
Other, net
—
(14)
Net cash provided by (used in)
financing activities
57
(442)
Net change in cash, cash equivalents
and restricted cash
16,113
(4,051)
Cash, cash equivalents and restricted
cash, beginning of period
22,483
36,655
Cash, cash equivalents and restricted
cash, end of period
$ 38,596
$ 32,604
ESS Tech, Inc.
Condensed Statements of Cash
Flows (continued)
(unaudited)
(in thousands)
Six Months Ended June
30,
2024
2023
Supplemental disclosures of cash flow
information:
Cash paid for operating leases included in
cash used in operating activities
$
874
$
827
Non-cash investing and financing
transactions:
Purchase of property and equipment
included in accounts payable and accrued and other current
liabilities
1,970
931
Transfers between inventory and property
and equipment, net
1,051
—
Cash and cash equivalents
$
36,744
$
30,287
Restricted cash, current
906
1,373
Restricted cash, non-current
946
944
Total cash, cash equivalents and
restricted cash shown in the condensed statements of cash flows
$
38,596
$
32,604
ESS Tech, Inc.
Reconciliation of GAAP to
Non-GAAP Operating Expenses
(unaudited)
(in thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Research and development
$
2,836
$
19,450
$
6,382
$
37,181
Less: stock-based compensation
(908
)
(1,130
)
(1,309
)
(2,123
)
Non-GAAP research and development
$
1,928
$
18,320
$
5,073
$
35,058
Sales and marketing
$
2,711
1,739
$
4,745
$
3,592
Less: stock-based compensation
(163
)
(165
)
(258
)
(315
)
Non-GAAP sales and marketing
$
2,548
$
1,574
$
4,487
$
3,277
General and administrative
$
6,178
$
5,845
$
11,704
$
11,132
Less: stock-based compensation
(1,540
)
(1,430
)
(2,974
)
(2,346
)
Non-GAAP general and administrative
$
4,638
$
4,415
$
8,730
$
8,786
Total operating expenses
$
11,725
$
27,034
$
22,831
$
51,905
Less: stock-based compensation
(2,611
)
(2,725
)
(4,541
)
(4,784
)
Non-GAAP total operating expenses
$
9,114
$
24,309
$
18,290
$
47,121
ESS Tech, Inc.
Reconciliation of GAAP Net
Loss to Adjusted EBITDA
(unaudited)
(in thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Net loss
$
(21,940
)
$
(22,929
)
$
(40,250
)
$
(44,830
)
Interest income, net
(1,052
)
(1,330
)
(2,291
)
(2,582
)
Stock-based compensation
3,026
2,725
5,880
4,784
Depreciation and amortization
1,302
1,028
2,521
2,105
Gain (loss) on revaluation of common stock
warrant liabilities
(115
)
115
(115
)
(573
)
Other income (expense), net
(18
)
(63
)
37
(721
)
Adjusted EBITDA
$
(18,797
)
$
(20,454
)
$
(34,218
)
$
(41,817
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240814379924/en/
Investors: Erik Bylin investors@essinc.com
Media: Morgan Pitts 503.568.0755
Morgan.Pitts@essinc.com
ESS Tech (NYSE:GWH)
過去 株価チャート
から 7 2024 まで 8 2024
ESS Tech (NYSE:GWH)
過去 株価チャート
から 8 2023 まで 8 2024