Advent Technologies Holdings, Inc. (NASDAQ: ADN) (“Advent” or
the “Company”), an innovation-driven leader in the fuel cell and
hydrogen technology space, announced on Tuesday, August 13, 2024
its consolidated financial results for the three months and year
ended December 31, 2023. All amounts are in U.S. dollars unless
otherwise noted and have been prepared in accordance with U.S.
generally accepted accounting principles (“GAAP”).
Q4 2023 Financial Highlights
(All comparisons are to Q4 2022, unless otherwise stated)
- Revenue of $1.5 million and income from grants of $0.8 million,
totaling $2.3 million, which represents a decrease of (3.6)%
year-over-year.
- Full year 2023 revenue of $4.9 million and income from grants
of $2.5 million, totaling $7.4 million. This represents a decrease
of (20.9)% year-over-year.
- Operating expenses of $44.6 million, representing a
year-over-year decrease of $1.1 million.
- Net loss in Q4 of $(25.7) million or $(12.04) per share, and
adjusted net loss of $(22.1) million or $(10.32) per share.
Adjusted net loss excludes a $0.03 million gain from the change in
the fair value of outstanding warrants, and a $3.71 million
goodwill and intangible asset impairment charge.
- Unrestricted cash reserves were $3.6 million as of December 31,
2023, a decrease of $0.1 million from September 30, 2023.
“Our product development efforts center around a common core
technology: a fuel cell and MEA (membrane electrode assembly)
designed to address heavy-duty automotive applications and
large-scale stationary systems. Success with our MEA technology is
key to unlocking these markets with the right OEM partnerships,”
said Dr. Vasilis Gregoriou, Advent’s Chairman and CEO. “Our
recent restructuring initiatives have been pivotal in significantly
reducing costs. We have already achieved a 70% cost reduction
compared to the same time last year. As a result of our strategic
shift and a reduction in direct sales efforts, particularly in
remote regions, we experienced a decrease in revenue in 2023, which
we view as a temporary adjustment. We believe it is prudent to
demonstrate this short-term revenue reduction rather than
overextend our financial resources. Our goal is to operate as close
as possible to break-even relying on the strategic OEM partnership
funds and R&D government funds and to have the maximum runway
until the inflection point. The partnering OEMs plans for mass
production will determine the inflection point timing. We
appreciate your ongoing support and patience and look forward to
updating you on our progress.”
Company Updates
Technology Update
The Advent Fuel Cell platform, based on our new Ion Pair™
Membrane Electrode Assembly (MEA), offers superior heat management
and the ability to operate with liquid eFuels and biofuels. These
unique properties, combined with the MEA’s increased power density,
form the basis for breakthrough innovation in the fuel cell
industry. Our partnerships with industry leaders such as Airbus,
the US Army, Hyundai Motor Company, and Siemens Energy not only
validate our technological achievements but also highlight the
potential of our technology. Our HT-PEM fuel cell technology is
ideal for marine and off-grid power applications, both of which are
increasingly adopting methanol. Additionally, our high-temperature
operation results in superior efficiency, reaching up to 85% when
heat is utilized. This positions HT-PEM as optimal for a wide range
of applications, including aviation and heavy-duty trucks. The Ion
Pair MEA technology has achieved in 2024 approximately double the
power of previous state of the art fuel cells per cm². We also have
concrete data that we will achieve double the lifetime of competing
HT-PEM fuel cell systems. Our fuel cells convert approximately 400
grams of methanol into 1kWh of electrical power, (equivalent to a
battery with a power density of 2,500 Wh/kg)—exceeding by a factor
of 10 the power density of lithium-ion batteries. Moreover, unlike
batteries or hydrogen-based systems, our fuel cells utilize the
existing global infrastructure for transporting and dispensing
liquid fuels. This advantage is especially beneficial for
developing regions. The Ion Pair MEA technology overcomes the prior
limitations of the HT-PEM technology.
Operations Update
In the past year, our journey has been marked by a blend of both
encouraging and challenging developments. On a positive note, there
has been an unprecedented surge in interest across various markets
for methanol fuel cells and clean power solutions. However, the
financial landscape for clean energy investments has been less
favorable, pushing us to seek support through EU infrastructure
loans and grants and a private loan from a US-based institutional
investor. These processes are typically accompanied by extended
bureaucratic processes. Over the years, particularly after our
acquisition of Serenergy (Denmark), we have advanced our hardware
technology, selling 1,200 systems mainly to the telecom industry.
This expertise provides a solid foundation for accelerating
partnerships through technology transfer and licensing. However, we
have chosen not to remain an end-product OEM across multiple
markets, as achieving this would require very significant
investment and considerable time. As a result, we have discontinued
operations of certain subsidiaries that focused on end-system
production, which demanded increasing capital for low-margin or
negative-margin revenues.
We have closed non-profitable subsidiaries and facilities in
Boston and Denmark, and the Philippines. The Danish subsidiary, in
particular, was producing fuel cells with older HT-PEM technology
at a cost exceeding $2,000 per kW. In contrast, with our Ion Pair
MEA technology, we anticipate that OEMs can develop systems at a
cost approaching $500 per kW at scale. Advent is now focusing on
advancing MEA innovation, expanding intellectual property
footprint, and scaling manufacturing in the future primarily
through technology licensing and Joint Development Agreements. This
strategic pivot enables us to reduce capital expenditures while
maintaining high margins and a sustainable business model.
Business Update
Our new approach involves forming joint ventures and technology
transfer agreements with major local integrators, Tier 1 suppliers,
and OEMs. By focusing on manufacturing the MEA and potentially the
fuel cell stack, we are establishing a scalable, low-capex, and
high-margin operational framework.
Global Market Expansion and Partnerships
1. Automotive
In the automotive industry, our MEA technology is currently
evaluated by four of the top ten global automakers. In addition,
our collaboration with Hyundai Motors has progressed to a Joint
Development Agreement, and we aim to secure similar agreements with
other major automakers by the end of 2024. Our high-temperature
fuel cells offer exceptional benefits for trucks and heavy-duty
vehicles, particularly in regions with extreme heat.
2. Aerospace
In aerospace, we have established a $13-million strategic
partnership with Airbus to develop our Ion Pair MEA for aviation
applications. This two-year Joint Development Agreement is designed
to meet aviation performance standards, paving the way for test
flights and hardware systems in the near future, with the ultimate
goal of enabling fuel cell-powered aircraft.
3. Defense
In the defense sector, we signed in September and December 2023
two contracts (representing total value to the Company of $5
million), with the U.S. Department of Defense. These contracts
refer to the HB50 product, a human-portable fuel cell that delivers
power for military missions. We are integrating our Ion Pair MEA
technology to enhance the HB50’s performance and scale up
production by 2026. The objective is to facilitate the shift from
low-prototype volume to manufacturing-scale volume. The program is
advancing steadily, with daily collaboration with the U.S.
Department of Defense. Significant milestones to date have been
successfully achieved.
4. Marine
Our technology is already deployed in Sanlorenzo’s 50Steel
methanol fuel cell superyacht, Almax. We believe methanol,
including biomethanol and e-methanol, is crucial for decarbonizing
the marine industry. With over 130 methanol projects globally, we
anticipate significant adoption in both retrofitted and new
yachts.
5. Data Centers
We are also pursuing collaborations with OEMs in the data center
off-grid power market, where we believe our fuel cell technology
presents distinct advantages. Data centers currently account for
1-2% of global power usage, a figure expected to rise to 3-4% by
2030 (1000TWhs per year). We anticipate that this increase will
drive substantial growth in electricity demand, particularly in the
US and Europe, and could double carbon emissions from data centers
by 2030.
We believe that our fuel cells can reduce capex and accelerate
deployment by eliminating the need for grid upgrades and extensive
permits. Our technology’s multifuel capability allows for immediate
deployment with methanol (on green eMethanol), biogas and the
option to switch to hydrogen or other fuels We are actively
engaging with companies interested in leveraging our HT-PEM
technology for large-scale data center projects.
R&D Programs
Our teams are actively engaged in a comprehensive portfolio of
13 research and development programs, with total funding amounting
to approximately $10 million. These programs receive support from
notable sources, including the European Union and key European
institutions such as Horizon Europe and the Clean Hydrogen
Partnership. In addition to these ongoing initiatives, we are also
forming strategic partnerships and submitting proposals for new
programs with substantial funding opportunities, such as the
European Innovation Fund. These efforts are designed to further
advance our technology and expand our collaborative network with
leading industry partners. This extensive network not only enhances
our technological capabilities but also ensures that we remain at
the forefront of innovation in our field.
Conference Call
The Company will host a conference call on Tuesday, August 20,
2024, at 9:00 AM ET to discuss its results. To access the call
please dial (800) 715-9871 from the United States, or +1 (646)
307-1963 from outside the U.S. The conference call I.D. number is
9909908. Participants should dial in 5 to 10 minutes before the
scheduled time. Participants can also attend the call virtually by
visiting the homepage of Advent's Investor Relations (IR) website,
where they can register for the event under the "Latest Events"
section.
A replay of the call can also be accessed via phone through
September 3, 2024, by dialing (800) 770-2030 from the U.S., or
+1(609) 800-9909 from outside the U.S. The conference I.D. number
is 9909908. An archived version will be available after the event
on the homepage of Advent's Investor Relations (IR) website, under
the "Latest Events" section.
About Advent Technologies Holdings, Inc
Advent Technologies Holdings, Inc. is a U.S. corporation that
develops, manufactures, and assembles complete fuel cell systems as
well as supplying customers with critical components for fuel cells
in the renewable energy sector. Advent is headquartered in
California and holds the IP for next-generation HT-PEM that enables
various fuels to function at high temperatures and under extreme
conditions, suitable for the automotive, aviation, defense, oil and
gas, marine, and power generation sectors. For more information,
visit www.advent.energy.
Cautionary Note Regarding Forward-Looking Statements
This press release includes forward-looking statements. These
forward-looking statements generally can be identified by the use
of words such as “anticipate,” “expect,” “plan,” “could,” “may,”
“will,” “believe,” “estimate,” “forecast,” “goal,” “project,” and
other words of similar meaning. Each forward-looking statement
contained in this press release is subject to risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied by such statement. Applicable risks
and uncertainties include, among others, the Company’s ability to
maintain the listing of the Company’s common stock on Nasdaq;
future financial performance; public securities’ potential
liquidity and trading; impact from the outcome of any known and
unknown litigation; ability to forecast and maintain an adequate
rate of revenue growth and appropriately plan its expenses;
expectations regarding future expenditures; future mix of revenue
and effect on gross margins; attraction and retention of qualified
directors, officers, employees and key personnel; ability to
compete effectively in a competitive industry; ability to protect
and enhance Advent’s corporate reputation and brand; expectations
concerning its relationships and actions with technology partners
and other third parties; impact from future regulatory, judicial
and legislative changes to the industry; ability to locate and
acquire complementary technologies or services and integrate those
into the Company’s business; future arrangements with, or
investments in, other entities or associations; and intense
competition and competitive pressure from other companies worldwide
in the industries in which the Company will operate; and the risks
identified under the heading “Risk Factors” in Advent’s Annual
Report on Form 10-K filed with the Securities and Exchange
Commission (“SEC”) on August 13, 2024, as well as the other
information filed with the SEC. Investors are cautioned not to
place considerable reliance on the forward-looking statements
contained in this press release. You are encouraged to read
Advent’s filings with the SEC, available at www.sec.gov , for a
discussion of these and other risks and uncertainties. The
forward-looking statements in this press release speak only as of
the date of this document, and the Company undertakes no obligation
to update or revise any of these statements. Advent’s business is
subject to substantial risks and uncertainties, including those
referenced above. Investors, potential investors, and others should
give careful consideration to these risks and uncertainties.
Presentation of Non-GAAP Financial Measures
In addition to the results provided in accordance with U.S. GAAP
throughout this press release, the Company has provided non-GAAP
financial measures - Adjusted Net Income / (Loss) and Adjusted
EBITDA - which present results on a basis adjusted for certain
items. The Company uses these non-GAAP financial measures for
business planning purposes and in measuring its performance
relative to that of its competitors. The Company believes that
these non-GAAP financial measures are useful financial metrics to
assess its operating performance from period-to-period by excluding
certain items that the Company believes are not representative of
its core business. These non-GAAP financial measures are not
intended to replace, and should not be considered superior to, the
presentation of the Company’s financial results in accordance with
GAAP. The use of the terms Adjusted Net Income / (Loss) and
Adjusted EBITDA may differ from similar measures reported by other
companies and may not be comparable to other similarly titled
measures. These measures are reconciled from the respective
measures under GAAP in the appendix below.
ADVENT TECHNOLOGIES HOLDINGS,
INC.
CONSOLIDATED BALANCE
SHEETS
(Amounts in USD thousands,
except share and per share amounts)
December 31, 2023
December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents
$
3,562
$
32,869
Restricted cash, current
100
-
Accounts receivable, net
191
979
Contract assets
21
52
Inventories
2,707
12,620
Prepaid expenses and Other current
assets
2,254
2,980
Total current assets
8,835
49,500
Non-current assets:
Goodwill
-
5,742
Intangibles, net
79
6,062
Property and equipment, net
21,549
17,938
Right-of-use assets
3,216
4,055
Restricted cash, non-current
750
750
Other non-current assets
308
5,221
Available for sale financial asset
-
320
Total non-current assets
25,902
40,088
Total assets
$
34,737
$
89,588
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Trade and other payables
$
5,087
$
4,680
Deferred income from grants, current
530
801
Contract liabilities
2,015
1,019
Other current liabilities
1,916
4,703
Operating lease liabilities
2,186
2,280
Income tax payable
179
183
Total current liabilities
11,913
13,666
Non-current liabilities:
Warrant liability
59
998
Long-term operating lease liabilities
8,230
9,802
Defined benefit obligation
83
72
Deferred income from grants,
non-current
320
50
Other long-term liabilities
684
852
Total non-current liabilities
9,376
11,774
Total liabilities
21,289
25,440
Commitments and contingent
liabilities
Stockholders’ equity
Common stock ($0.0001 par value per share;
Shares authorized: 110,000,000 at December 31, 2023 and December
31, 2022; Issued and outstanding: 2,580,159 and 1,723,924 at
December 31, 2023 and December 31, 2022, respectively)
8
5
Preferred stock ($0.0001 par value per
share; Shares authorized: 1,000,000 at December 31, 2023 and
December 31, 2022; nil 0 issued and outstanding at December 31,
2023 and December 31, 2022)
-
-
Additional paid-in capital
194,933
174,509
Accumulated other comprehensive loss
(2,334
)
(2,604
)
Accumulated deficit
(179,159
)
(107,762
)
Total stockholders’ equity
13,448
64,148
Total liabilities and stockholders’
equity
$
34,737
$
89,588
ADVENT TECHNOLOGIES HOLDINGS,
INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Amounts in USD thousands,
except share and per share amounts)
Three months ended December
31,
Years Ended December
31,
(Unaudited)
(Unaudited)
2023
2022
2023
2022
Revenue, net
$
1,506
$
1,957
$
4,859
$
7,837
Cost of revenues
(12,442)
(2,455)
(18,287)
(8,581)
Gross profit / (loss)
(10,936)
(498)
(13,428)
(744)
Income from grants
814
449
2,504
1,460
Research and development expenses
(3,957)
(2,458)
(12,112)
(9,796)
Administrative and selling expenses
(6,732)
(9,258)
(32,468)
(35,915)
Sublease income
139
-
543
-
Amortization of intangible assets
(116)
(651)
(642)
(2,764)
Credit loss – customer contracts
(1,207)
(1,116)
(1,270)
(1,116)
Gain from purchase price adjustment
-
2,370
-
2,370
Impairment losses
(3,705)
(38,922)
(13,468)
(38,922)
Operating loss
(25,700)
(50,084)
(70,341)
(85,427)
Fair value change of warrant liability
39
2,127
394
9,375
Finance income / (expenses), net
(44)
61
74
52
Foreign exchange gains / (losses), net
(9)
(40)
97
(91)
Other income / (expenses), net
(19)
4
(902)
(216)
Loss before income tax
(25,733)
(47,932)
(70,678)
(76,307)
Income taxes
1
307
(719)
1,970
Net loss
$
(25,732)
$
(47,625)
$
(71,397)
$
(74,337)
Net loss per share
Basic loss per share
(12.04)
(27.63)
(37.24)
(43.28)
Basic weighted average number of
shares
2,136,840
1,723,924
1,917,179
1,717,623
Diluted loss per share
(12.04)
(27.63)
(37.24)
(43.28)
Diluted weighted average number of
shares
2,136,840
1,723,924
1,917,179
1,717,623
ADVENT TECHNOLOGIES HOLDINGS,
INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Amounts in USD
thousands)
Years Ended December
31,
(Unaudited)
2023
2022
Net Cash used in Operating
Activities
$
(32,115)
$
(32,125)
Cash Flows from Investing
Activities:
Proceeds from sale of property and
equipment
256
-
Purchases of property and equipment
(3,371)
(11,527)
Purchases of intangible assets
-
(117)
Advances for the acquisition of property
and equipment
(1,255)
(2,557)
Acquisition of a subsidiary, net of cash
acquired
(1,864)
-
Acquisition of available for sale
financial assets
-
(316)
Net Cash used in Investing
Activities
$
(6,234)
$
(14,517)
Cash Flows from Financing
Activities:
Issuance of common stock and paid-in
capital, net of issuance costs paid
9,059
-
Repayments of debt
-
(40)
Net Cash (used in) provided by
Financing Activities
$
9,059
$
(40)
Net (decrease) / increase in cash, cash
equivalents, restricted cash and restricted cash
equivalents
$
(29,290)
$
(46,682)
Effect of exchange rate changes on cash,
cash equivalents, restricted cash and restricted cash
equivalents
83
537
Cash, cash equivalents, restricted cash
and restricted cash equivalents at the beginning of year
33,619
79,764
Cash, cash equivalents, restricted cash
and restricted cash equivalents at the end of year
$
4,412
$
33,619
Supplemental Non-GAAP Measures and Reconciliations
In addition to providing measures prepared in accordance with
GAAP, we present certain supplemental non-GAAP measures. These
measures are EBITDA, Adjusted EBITDA and Adjusted Net Income /
(Loss), which we use to evaluate our operating performance, for
business planning purposes and to measure our performance relative
to that of our peers. These non-GAAP measures do not have any
standardized meaning prescribed by GAAP and therefore may differ
from similar measures presented by other companies and may not be
comparable to other similarly titled measures. We believe these
measures are useful in evaluating the operating performance of the
Company’s ongoing business. These measures should be considered in
addition to, and not as a substitute for net income, operating
expense and income, cash flows and other measures of financial
performance and liquidity reported in accordance with GAAP. The
calculation of these non-GAAP measures has been made on a
consistent basis for all periods presented.
EBITDA and Adjusted EBITDA
These supplemental non-GAAP measures are provided to assist
readers in determining our operating performance. We believe this
measure is useful in assessing performance and highlighting trends
on an overall basis. We also believe EBITDA and Adjusted EBITDA are
frequently used by securities analysts and investors when comparing
our results with those of other companies. EBITDA differs from the
most comparable GAAP measure, net income / (loss), primarily
because it does not include interest, income taxes, depreciation of
property, plant and equipment, and amortization of intangible
assets. Adjusted EBITDA adjusts EBITDA for one-time transaction
costs, asset impairment charges, changes in warrant liability, and
executive severance.
The following tables show a reconciliation of net income /
(loss) to EBITDA and Adjusted EBITDA for the three months and years
ended December 31, 2023 and 2022.
Three months ended December
31,
Years Ended December
31,
EBITDA and Adjusted EBITDA
(Unaudited)
(Unaudited)
(in Millions of U.S. dollars)
2023
2022
$ change
2023
2022
$ change
Net loss
$
(25.73)
$
(47.63)
21.90
$
(71.40)
$
(74.34)
2.94
Depreciation of property and equipment
$
0.91
$
0.36
0.55
$
3.01
$
1.49
1.52
Amortization of intangibles
$
0.11
$
0.65
(0.54)
$
0.64
$
2.76
(2.12)
Finance income / (expenses), net
$
0.05
$
(0.06)
0.11
$
(0.07)
$
(0.05)
(0.02)
Other income / (expenses), net
$
0.02
$
0.00
0.02
$
0.90
$
0.22
0.68
Foreign exchange differences, net
$
0.01
$
0.04
(0.03)
$
(0.10)
$
0.09
(0.19)
Income taxes
$
-
$
(0.31)
0.31
$
0.72
$
(1.97)
2.69
EBITDA
$
(24.63)
$
(46.95)
22.32
$
(66.30)
$
(71.80)
5.50
Net change in warrant liability
$
(0.03)
$
(2.13)
2.10
$
(0.39)
$
(9.38)
8.99
Gain from purchase price adjustment
$
-
$
(2.37)
2.37
$
-
$
(2.37)
2.37
Impairment loss – intangible assets and
goodwill
$
3.71
$
38.92
(35.21)
$
13.47
$
38.92
(25.45)
Adjusted EBITDA
$
(20.95)
$
(12.53)
(8.42)
$
(53.22)
$
(44.63)
(8.59)
Adjusted Net Income / (Loss)
This supplemental non-GAAP measure is provided to assist readers
in determining our financial performance. We believe this measure
is useful in assessing performance and highlighting trends on an
overall basis. Adjusted Net Loss differs from the most comparable
GAAP measure, net income / (loss), primarily because it does not
include one-time transaction costs, asset impairment charges,
changes in warrant liability, and executive severance. The
following table shows a reconciliation of net income / (loss) for
the three months and years ended December 31, 2023 and 2022.
Three months ended December
31,
Years Ended December
31,
Adjusted Net Loss
(Unaudited)
(Unaudited)
(in Millions of U.S. dollars)
2023
2022
$ change
2023
2022
$ change
Net loss
$
(25.73)
$
(47.63)
21.90
$
(71.40)
$
(74.34)
2.94
Net change in warrant liability
$
(0.03)
$
(2.13)
2.10
$
(0.39)
$
(9.38)
8.99
Gain from purchase price adjustment
$
-
$
(2.37)
2.37
$
-
$
(2.37)
2.37
Impairment loss – intangible assets and
goodwill
$
3.71
$
38.92
(35.21)
$
13.47
$
38.92
(25.45)
Adjusted Net Loss
$
(22.05)
$
(13.21)
(8.84)
$
(58.32)
$
(47.17)
(11.15)
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version on businesswire.com: https://www.businesswire.com/news/home/20240820647258/en/
Advent Technologies Holdings, Inc. Michael Trontzos
press@advent.energy
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