Li-Cycle Reports First Quarter 2024 Operational and Financial Results
Highlights
-
Continued to work closely with the
U.S. Department of Energy on key technical, financial and legal workstreams to advance toward definitive financing documentation required for a loan for gross proceeds of up to$375 million ; -
Advanced commercial relationships, including entering into new or expanded strategic agreements with three of the largest electric vehicle (EV) companies in
Europe ; -
Closed the
$75 million senior secured convertible note issued to Glencore to strengthen long-term partnership and enhanceLi-Cycle ’s liquidity position; -
Continued Cash Preservation Plan with change to centralized organizational structure and workforce reductions expected to generate savings of up to
$10 million annually; - Progressed work on Rochester Hub project review, including advancing work with the local market to refine cost estimates; and
-
Ended the first quarter with a cash and cash equivalents of
$109.1 million .
“During the first quarter of 2024, we advanced our comprehensive review of the Rochester Hub go-forward plan and continue to work closely with the
Financing and Liquidity
On
On
On
Commercial Highlights
The Company strengthened its global commercial partnerships during the first quarter, which provided further validation of Li-Cycle’s sustainable recycling technology and makes us well-placed to be a preferred global recycling partner.
In
In
Review of Q1 2024 Financial Results
Total revenue includes revenue from product sales, recycling services and non-cash fair market value (FMV) pricing adjustments. Revenue from product sales and recycling services, which excludes fair market value pricing adjustments, were
Cost of sales decreased 12% to
Selling, general & administrative (SG&A) expenses increased to
Other expense was
Net loss was
Adjusted EBITDA1 loss was approximately
The Company incurred capital expenditures of
Balance Sheet Position
As of
Webcast and Conference Call Information
On
Investors may listen to the conference call live via audio-only webcast or through the following dial-in numbers:
Domestic: (800) 343-5419
International: (203) 518-9731
Participant Code: LICYQ124
Webcast: https://investors.li-cycle.com
A replay of the conference call/webcast will also be made available on the Investor Relations section of the Company’s website at https://investors.li-cycle.com.
About
1
Adjusted EBITDA is not a recognized measure under
Results of Operations Summary1
|
Three months ended |
|||||||||||
$ millions, except per share data |
|
|
2024 |
|
|
|
2023 |
|
|
Change |
||
Financial highlights |
|
|
|
|||||||||
Revenue |
$ |
4.2 |
|
$ |
3.6 |
|
$ |
0.6 |
|
|||
Cost of sales |
|
(16.8 |
) |
|
(19.1 |
) |
|
2.3 |
|
|||
Selling, general and administrative expense |
|
(31.7 |
) |
|
(22.7 |
) |
|
(9.0 |
) |
|||
Research and development |
|
0.1 |
|
|
(0.9 |
) |
|
1.0 |
|
|||
Other income (expense) |
|
(92.5 |
) |
|
2.7 |
|
|
(95.2 |
) |
|||
Income tax |
|
— |
|
|
(0.1 |
) |
|
0.1 |
|
|||
Net loss |
|
(136.7 |
) |
|
(36.5 |
) |
|
(100.2 |
) |
|||
Adjusted EBITDA1 loss |
|
(27.4 |
) |
|
(37.9 |
) |
|
10.5 |
|
|||
Loss per common share - basic and diluted |
|
(0.76 |
) |
|
(0.21 |
) |
|
(0.55 |
) |
|||
Net cash used in operating activities |
$ |
(29.1 |
) |
$ |
(22.4 |
) |
$ |
(6.7 |
) |
|||
|
|
|
|
|||||||||
As at |
|
|
Change |
|||||||||
Cash and cash equivalents |
|
|
||||||||||
Cash and cash equivalents balance2 |
$ |
109.1 |
|
$ |
70.6 |
|
$ |
38.5 |
|
1 |
|
Adjusted EBITDA is a non-GAAP financial measure and does not have a standardized meaning under |
2 |
|
Excludes restricted cash of |
Non-GAAP Financial Measures
Adjusted EBITDA (loss)
|
Three months ended |
|||||||
Unaudited - $ millions |
|
|
2024 |
|
|
|
2023 |
|
Net loss |
$ |
(136.7 |
) |
$ |
(36.5 |
) |
||
Income tax |
|
— |
|
|
(0.1 |
) |
||
Depreciation and amortization |
|
4.2 |
|
|
1.9 |
|
||
Interest expense |
|
11.5 |
|
|
1.1 |
|
||
Interest income |
|
(0.6 |
) |
|
(5.0 |
) |
||
EBITDA (loss) |
$ |
(121.6 |
) |
$ |
(38.6 |
) |
||
Debt extinguishment loss |
|
58.9 |
|
|
— |
|
||
Restructuring fees1 |
|
11.5 |
|
|
— |
|
||
Fair value loss on financial instruments2 |
|
23.8 |
|
|
0.7 |
|
||
Adjusted EBITDA (loss) |
$ |
(27.4 |
) |
$ |
(37.9 |
) |
1 |
Restructuring charges include: expense related to the workforce reduction approved by the Board on |
|
2 |
Fair value gain on financial instruments relates to convertible debt. |
Cautionary Notes - Forward-Looking Statements and Unaudited Results
Certain statements contained in this press release may be considered “forward-looking statements” within the meaning of the
These forward-looking statements are provided for the purpose of assisting readers in understanding certain key elements of Li-Cycle’s current objectives, goals, targets, strategic priorities, expectations and plans, and in obtaining a better understanding of Li-Cycle’s business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes and is not intended to serve as, and must not be relied on, by any investor as a guarantee, an assurance, a prediction or a definitive statement of fact or probability.
Forward-looking statements involve inherent risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of
|
||||||||
Unaudited condensed consolidated interim balance sheets |
||||||||
All dollar amounts presented are expressed in millions of US dollars except share and per share amounts |
||||||||
|
|
|
||||||
Assets |
|
|
||||||
Current assets |
|
|
||||||
Cash and cash equivalents |
$ |
109.1 |
|
$ |
70.6 |
|
||
Restricted cash |
|
9.6 |
|
|
9.7 |
|
||
Accounts receivable, net |
|
2.9 |
|
|
1.0 |
|
||
Other receivables |
|
1.6 |
|
|
1.9 |
|
||
Prepayments, deposits and other current assets |
|
55.3 |
|
|
56.2 |
|
||
Inventories, net |
|
8.5 |
|
|
9.6 |
|
||
Total current assets |
|
187.0 |
|
|
149.0 |
|
||
|
|
|
||||||
Non-current assets |
|
|
||||||
Property, plant and equipment, net |
|
665.0 |
|
|
668.8 |
|
||
Operating lease right-of-use assets |
|
70.5 |
|
|
56.4 |
|
||
Finance lease right-of-use assets |
|
2.2 |
|
|
2.2 |
|
||
Other assets |
|
7.6 |
|
|
9.6 |
|
||
|
|
745.3 |
|
|
737.0 |
|
||
Total assets |
$ |
932.3 |
|
$ |
886.0 |
|
||
|
|
|
||||||
Liabilities |
|
|
||||||
Current liabilities |
|
|
||||||
Accounts payable |
$ |
118.6 |
|
$ |
134.5 |
|
||
Accrued liabilities |
|
31.8 |
|
|
17.6 |
|
||
Deferred revenue |
|
2.4 |
|
|
0.2 |
|
||
Operating lease liabilities |
|
8.5 |
|
|
4.4 |
|
||
Total current liabilities |
|
161.3 |
|
|
156.7 |
|
||
|
|
|
||||||
Non-current liabilities |
|
|
||||||
Accounts payable |
|
6.6 |
|
|
— |
|
||
Deferred revenue |
|
5.2 |
|
|
5.3 |
|
||
Operating lease liabilities |
|
65.3 |
|
|
56.2 |
|
||
Finance lease liabilities |
|
2.2 |
|
|
2.3 |
|
||
Convertible debt |
|
447.7 |
|
|
288.1 |
|
||
Asset retirement obligations |
|
1.0 |
|
|
1.0 |
|
||
|
|
528.0 |
|
|
352.9 |
|
||
Total liabilities |
$ |
689.3 |
|
$ |
509.6 |
|
||
Commitments and Contingencies |
|
|
||||||
|
|
|
||||||
Equity |
|
|
||||||
Common stock and additional paid-in capital
Authorized unlimited shares, Issued and outstanding - 179.1 shares at |
|
651.6 |
|
|
648.3 |
|
||
Accumulated deficit |
|
(408.3 |
) |
|
(271.6 |
) |
||
Accumulated other comprehensive loss |
|
(0.3 |
) |
|
(0.3 |
) |
||
Total equity |
|
243.0 |
|
|
376.4 |
|
||
Total liabilities and equity |
$ |
932.3 |
|
$ |
886.0 |
|
||
|
||||||||
Unaudited condensed consolidated interim statements of operations and comprehensive loss |
||||||||
All dollar amounts presented are expressed in millions of US dollars except share and per share amounts |
||||||||
|
For the three months ended |
For the three months ended |
||||||
Revenue |
|
|
||||||
Product revenue |
|
1.9 |
|
|
3.1 |
|
||
Recycling service revenue |
|
2.3 |
|
|
0.5 |
|
||
Total revenue |
|
4.2 |
|
|
3.6 |
|
||
Cost of sales |
|
|
||||||
Cost of sales - Product revenue |
|
(15.9 |
) |
|
(19.1 |
) |
||
Cost of sales - Recycling service revenue |
|
(0.9 |
) |
|
— |
|
||
Total cost of sales |
|
(16.8 |
) |
|
(19.1 |
) |
||
Selling, general and administrative expense |
|
(31.7 |
) |
|
(22.7 |
) |
||
Research and development |
|
0.1 |
|
|
(0.9 |
) |
||
Loss from operations |
|
(44.2 |
) |
|
(39.1 |
) |
||
|
|
|
||||||
Other income (expense) |
|
|
||||||
|
|
|
||||||
Interest income |
|
0.6 |
|
|
5.0 |
|
||
Interest expense |
|
(11.5 |
) |
|
(1.1 |
) |
||
Foreign exchange gain (loss) |
|
1.1 |
|
|
(0.5 |
) |
||
Fair value loss on financial instruments |
|
(23.8 |
) |
|
(0.7 |
) |
||
Debt extinguishment loss (Note 14) |
|
(58.9 |
) |
|
— |
|
||
|
|
(92.5 |
) |
|
24.7 |
|
||
|
|
|
||||||
Net loss before taxes |
|
(136.7 |
) |
|
(137.9 |
) |
||
Income tax |
|
— |
|
|
(0.1 |
) |
||
Net loss and comprehensive loss |
|
(136.7 |
) |
|
(138.0 |
) |
||
|
|
|
||||||
Loss per common share - basic and diluted |
$ |
(0.76 |
) |
$ |
(0.21 |
) |
||
|
||||||||
Unaudited condensed consolidated interim statements of cash flows |
||||||||
All dollar amounts presented are expressed in millions of US dollars except share and per share amounts |
|
|||||||
|
For the three months ended |
For the three months ended |
||||||
Operating activities |
|
|
||||||
Net loss for the period |
$ |
(136.7 |
) |
$ |
(36.5 |
) |
||
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
||||||
Share-based compensation |
|
3.2 |
|
|
3.2 |
|
||
Depreciation and amortization |
|
4.2 |
|
|
1.9 |
|
||
Foreign exchange (gain) loss on translation |
|
(1.3 |
) |
|
0.2 |
|
||
Fair value loss on financial instruments |
|
23.8 |
|
|
0.7 |
|
||
Bad debt expense |
|
— |
|
|
1.0 |
|
||
Inventory write downs to net realizable value |
|
1.8 |
|
|
2.1 |
|
||
Loss on write off of fixed assets |
|
0.1 |
|
|
— |
|
||
Interest and accretion on convertible debt |
|
11.5 |
|
|
1.1 |
|
||
Debt extinguishment loss (Note 14) |
|
58.9 |
|
|
— |
|
||
Non-cash lease expense |
|
(1.1 |
) |
|
(0.1 |
) |
||
|
|
(35.6 |
) |
|
(26.4 |
) |
||
Changes in working capital items: |
|
|
||||||
Accounts receivable |
|
(1.9 |
) |
|
(0.4 |
) |
||
Other receivables |
|
0.3 |
|
|
4.4 |
|
||
Prepayments and deposits |
|
2.1 |
|
|
(3.3 |
) |
||
Inventories |
|
(0.4 |
) |
|
0.5 |
|
||
Deferred revenue |
|
2.1 |
|
|
— |
|
||
Accounts payable and accrued liabilities |
|
4.3 |
|
|
2.8 |
|
||
Net cash used in operating activities |
|
(29.1 |
) |
|
(22.4 |
) |
||
|
|
|
||||||
Investing activities |
|
|
||||||
Purchases of property, plant, equipment, and other assets |
|
(6.2 |
) |
|
(86.3 |
) |
||
Net cash used in investing activities |
|
(6.2 |
) |
|
(86.3 |
) |
||
|
|
|
||||||
Financing activities |
|
|
||||||
Proceeds from convertible debt |
|
75.0 |
|
|
— |
|
||
Payments of transaction costs |
|
(1.3 |
) |
|
— |
|
||
Net cash provided by financing activities |
|
73.7 |
|
|
— |
|
||
|
|
|
||||||
Net change in cash, cash equivalents and restricted cash |
|
38.4 |
|
|
(108.7 |
) |
||
Cash, cash equivalents and restricted cash, beginning of period |
|
80.3 |
|
|
517.9 |
|
||
Cash, cash equivalents and restricted cash, end of period |
$ |
118.7 |
|
$ |
409.2 |
|
||
|
|
|
||||||
Supplemental non-cash investing activities: |
|
|
||||||
Purchases of property and equipment included in liabilities |
$ |
16.7 |
|
$ |
25.4 |
|
||
Decreases of property and equipment and liabilities for credits from suppliers |
$ |
24.4 |
|
$ |
— |
|
||
Supplemental information: |
|
|
||||||
Interest paid |
|
— |
|
|
(0.1 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240510862629/en/
Investor Relations & Media
Investor Relations: investors@li-cycle.com
Media: media@li-cycle.com
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