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FREYR Battery Reports Second Quarter 2024 Results

FREYR Battery, Inc. (NYSE: FREY) (“FREYR” or the “Company”), a developer of sustainable, next-generation battery solutions, today reported financial results for the second quarter of 2024.

Key Messages:

  • FREYR’s new Board of Directors and leadership team executing plan to achieve first revenues and EBITDA as soon as 2025. The Company’s top priority is to focus resources on financeable projects and inorganic opportunities that accelerate FREYR’s commercialization and pathway to cash flows.
  • FREYR is prioritizing conventional technology strategy to achieve commercialization. FREYR is advancing discussions and diligence tied to agreements to develop conventional battery technology solutions in the U.S. and Europe under its previously unveiled FREYR 2.0 growth initiative. Within the commercial and project pipelines, the Company is focusing on less-capital intensive opportunities tied to downstream modules and packs which offer the fastest and most readily financeable paths to first revenues and cash flows.
  • Maintaining strict financial discipline and balance sheet strength. The Company remains committed to preserving the strength of its debt-free balance sheet by reducing its cash burn rate. The spending reductions currently underway are expected to extend FREYR’s cash liquidity runway to approximately 36 months. As part of the Company’s commitment to value maximization, FREYR is concurrently evaluating value accretive business models and use cases for Giga Arctic.
  • Evaluating inorganic opportunities. FREYR is pursuing potential inorganic opportunities to accelerate its commercialization efforts.
  • Maintaining ambition to establish long-term competitive moat based on next-generation intellectual property with the 24M SemiSolidTM platform. As FREYR intensifies its near-term commercialization efforts with its conventional technology strategy, the Company is preserving the option value of its position on 24M’s SemiSolidTM platform. After hitting several production milestones at the Customer Qualification Plant (“CQP”) in 2024, the Company is exploring new funding and commercial pathways for its next-generation IP to augment its long-term competitive position.

“Following the second quarter’s production achievements at the CQP on the 24M platform, FREYR’s reconfigured Board of Directors and management team have unified the organization’s focus on rapid commercialization while we extend our liquidity runway to 36 months,” commented Tom Jensen, FREYR’s Co-founder, Chief Executive Officer and Board Member. “Having demonstrated that our people have unique technical and operational capabilities, during the last 65 days since the new team was appointed, we have been building momentum with our partners and customers to develop projects in high-return adjacencies on the battery value chain. The discussions we are having with a variety of industry leaders are exciting, and we look forward to sharing additional updates on these important strategic initiatives as they continue to develop.”

Recent news

  • Successful production trials at Customer Qualification Plant (“CQP”). Following several prior interim milestones at the CQP earlier this year, in June, FREYR announced that it had become the first company to complete automated production trials on the second-generation 24M SemiSolidTM manufacturing platform. While simultaneously running the anode casting, cathode casting, and merge units in automatic mode, FREYR produced more than 50 individual unit cells. FREYR is now exploring funding pathways for the long-term development of its next-generation technology stack.
  • Leadership changes to support FREYR’s commitment to accelerate path to profitability. In June 2024, FREYR announced the return of Co-founder and previous CEO and Executive Chairman Tom Jensen to the CEO role, and the appointments of Evan Calio as FREYR’s CFO, and of Daniel Barcelo as the Chairman of FREYR’s Board of Directors. FREYR’s Board and management team are focused on key initiatives, including: pursuing organic and inorganic opportunities in the U.S. and Europe to accelerate FREYR’s timelines to revenues and EBITDA and maintaining strict financial discipline to preserve the strength of the Company’s clean balance sheet and extend FREYR’s cash liquidity runway to 36 months.

Results Overview, Financing, and Liquidity

  • FREYR reported a net loss attributable to stockholders for the second quarter of 2024 of $(27.0) million, or $(0.19) per diluted share compared to net loss for the second quarter 2023 of $(25.3) million or $(0.18) per diluted share. The increase in net loss in the second quarter of 2024 was primarily due to a $0.1 million net foreign currency transaction loss for the three months ended June 30, 2024, compared to a $7.7 million gain for the three months ended June 30, 2023, partially offset by lower operating expenses mainly from decreases in personnel costs and legal and professional fees.
  • As of June 30, 2024, FREYR had cash, cash equivalents, and restricted cash of $221.5 million, and no debt.

Presentation of Second Quarter 2024 Results

A presentation will be held today, August 9, 2024, at 8:30 am Eastern Daylight Time (2:30 pm Central European Time) to discuss financial results for the second quarter 2024. The results and presentation material will be available for download at https://ir.freyrbattery.com.

To access the conference call, listeners should contact the conference call operator at the appropriate number listed below approximately 10 minutes prior to the start of the call.

Participant conference call dial-in numbers:

USA / International Toll +1 (646) 307-1963

USA - Toll-Free (800) 715-9871

UK - London +44.20.3433.3846

UK - Toll-Free +44.800.358.0970

Denmark - National +45.70.71.00.47

Denmark - Toll-Free +45.80.711369

Norway - Forde +47.57.98.92.37

Sweden - Stockholm +46.8.535.243.45

Sweden - Toll-Free +46.20.0123579

Greece - Athens +30.21.1199.4415

Spain - Madrid +34.917.874.190

Spain - Toll-Free +34.800.906144

Germany - Berlin +49.30.22403073

Germany - Toll-Free +49.800.0000105

The participant passcode for the call is: 4087726

A webcast of the conference call will be broadcast simultaneously at https://events.q4inc.com/attendee/250372491 on a listen-only basis. Please log in at least 10 minutes in advance to register and download any necessary software.

A replay of the webcast will be available at https://ir.freyrbattery.com/events-and-presentations/Events-Calendar/default.aspx.

About FREYR Battery

FREYR Battery is a developer of sustainable, next-generation battery solutions. The Company’s mission is to accelerate the decarbonization of global energy and transportation systems by producing sustainable, cost-competitive batteries. FREYR seeks to serve the primary markets of energy storage systems (“ESS”) and commercial mobility, and the Company maintains an ambition to serve the passenger electric vehicles market (“EV”). FREYR is operating its Customer Qualification Plant (“CQP”) for technology development in Mo i Rana, Norway, and the Company is continuing development of the Giga America battery manufacturing project in Coweta County, Georgia, in the U.S. To learn more about FREYR, please visit www.freyrbattery.com.

Cautionary Statement Concerning Forward-Looking Statements

All statements, other than statements of present or historical facts included in this press release, including, without limitation, FREYR Battery, Inc.’s (“FREYR”) ability to establish a profitable business; FREYR’s plan to extend its cash liquidity runway to 36 months and first revenue and EBITDA in 2025; the financial benefits of FREYR’s subject matter expertise; FREYR’s plan to expand on the battery value chain into high value adjacencies; FREYR’s efforts to accelerate the path to commercialization; the pursuit of project opportunities in accordance with the FREYR 2.0 initiative; potential inorganic growth opportunities and the ability to generate revenue in the near-term through possible acquisitions; the development, financing, construction, timeline, capacity, and other usefulness of FREYR’s CQP, Giga Arctic, Giga America, and other planned or future production facilities; any potential benefits of the U.S. Inflation Reduction Act; FREYR’s ability to reduce spending; and the implementation and effectiveness of FREYR’s overall business, technology, capital-raising, and liquidity strategies are forward-looking statements.

These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside FREYR’s control and are difficult to predict. Additional information about factors that could materially affect FREYR is set forth under the “Risk Factors” section in (i) FREYR’s Registration Statement on Form S-3 filed with the Securities and Exchange Commission (the “SEC”) on September 1, 2022 and subsequent post-effective amendment thereto filed on January 5, 2024, (ii) FREYR Battery, Inc.’s Registration Statement on Form S-4 filed with the SEC on September 8, 2023 and subsequent amendments thereto filed on October 13, 2023, October 19, 2023, and October 31, 2023, (iii) FREYR’s annual report on Form 10-K filed with the SEC on February 29, 2024; and (iv) FREYR’s Quarterly Reports on Form 10-Q filed with the SEC on May 8, 2024 and available on the SEC’s website at www.sec.gov. Except as otherwise required by applicable law, FREYR disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this presentation. Should underlying assumptions prove incorrect, actual results and projections could differ materially from those expressed in any forward-looking statements.

FREYR intends to use its website as a channel of distribution to disclose information which may be of interest or material to investors and to communicate with investors and the public. Such disclosures will be included on FREYR’s website in the ‘Investor Relations’ sections. FREYR also intends to use certain social media channels, including, but not limited to, Twitter and LinkedIn, as means of communicating with the public and investors about FREYR, its progress, products, and other matters. While not all the information that FREYR posts to its digital platforms may be deemed to be of a material nature, some information may be. As a result, FREYR encourages investors and others interested to review the information that it posts and to monitor such portions of FREYR’s website and social media channels on a regular basis, in addition to following FREYR’s press releases, SEC filings, and public conference calls and webcasts. The contents of FREYR’s website and other social media channels shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

 

FREYR BATTERY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(Unaudited)

 

 

June 30,

2024

 

December 31,

2023

 

 

 

ASSETS

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

219,560

 

$

253,339

Restricted cash

 

 

1,977

 

 

22,403

Prepaid assets

 

 

868

 

 

2,168

Other current assets

 

 

12,016

 

 

34,044

Total current assets

 

 

234,421

 

 

311,954

 

 

 

 

 

Property and equipment, net

 

 

362,641

 

 

366,357

Intangible assets, net

 

 

2,738

 

 

2,813

Long-term investments

 

 

21,969

 

 

22,303

Right-of-use asset under operating leases

 

 

22,603

 

 

24,476

Other long-term assets

 

 

9

 

 

4,282

Total assets

 

$

644,381

 

$

732,185

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

 

 

 

 

Accounts payable

 

$

14,688

 

$

18,113

Accrued liabilities and other

 

 

20,495

 

 

30,790

Share-based compensation liability

 

 

168

 

 

281

Total current liabilities

 

 

35,351

 

 

49,184

 

 

 

 

 

Warrant liability

 

 

1,817

 

 

2,025

Operating lease liability

 

 

16,921

 

 

18,816

Other long-term liabilities

 

 

27,443

 

 

27,444

Total liabilities

 

 

81,532

 

 

97,469

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

Preferred stock, $0.01 par value, 10,000 shares authorized, none issued and outstanding as of both June 30, 2024 and December 31, 2023

 

 

 

 

Common stock, $0.01 par value, 355,000 shares authorized as of both June 30, 2024 and December 31, 2023; 140,490 issued and outstanding as of June 30, 2024; and 139,705 issued and outstanding as of December 31, 2023

 

 

1,405

 

 

1,397

Additional paid-in capital

 

 

930,781

 

 

925,623

Accumulated other comprehensive loss

 

 

(40,008)

 

 

(18,826)

Accumulated deficit

 

 

(330,529)

 

 

(274,999)

Total stockholders' equity

 

 

561,649

 

 

633,195

 

 

 

 

 

Non-controlling interests

 

 

1,200

 

 

1,521

Total equity

 

 

562,849

 

 

634,716

 

 

 

 

 

Total liabilities and equity

 

$

644,381

 

$

732,185

 

FREYR BATTERY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except per share amounts)

(Unaudited)

 

 

Three months ended

June 30,

 

Six months ended

June 30,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

Operating expenses:

 

 

 

 

 

 

 

 

General and administrative

 

$

20,107

 

$

27,631

 

$

43,008

 

$

57,633

Research and development

 

 

10,493

 

 

6,365

 

 

22,238

 

 

11,209

Share of net loss of equity method investee

 

 

178

 

 

30

 

 

334

 

 

55

Total operating expenses

 

 

30,778

 

 

34,026

 

 

65,580

 

 

68,897

Loss from operations

 

 

(30,778)

 

 

(34,026)

 

 

(65,580)

 

 

(68,897)

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Warrant liability fair value adjustment

 

 

52

 

 

(2,556)

 

 

198

 

 

(1,151)

Interest income, net

 

 

1,148

 

 

1,755

 

 

2,553

 

 

4,758

Foreign currency transaction (loss) gain

 

 

(122)

 

 

7,711

 

 

1,355

 

 

23,759

Other income, net

 

 

2,550

 

 

1,851

 

 

5,634

 

 

3,566

Total other income

 

 

3,628

 

 

8,761

 

 

9,740

 

 

30,932

Loss before income taxes

 

 

(27,150)

 

 

(25,265)

 

 

(55,840)

 

 

(37,965)

Income tax expense

 

 

(11)

 

 

(138)

 

 

(11)

 

 

(341)

Net loss

 

 

(27,161)

 

 

(25,403)

 

 

(55,851)

 

 

(38,306)

Net loss attributable to non-controlling interests

 

 

174

 

 

121

 

 

321

 

 

298

Net loss attributable to stockholders

 

$

(26,987)

 

$

(25,282)

 

$

(55,530)

 

$

(38,008)

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - basic and diluted

 

 

140,107

 

 

139,705

 

 

139,905

 

 

139,705

Net loss per share attributable to stockholders - basic and diluted

 

$

(0.19)

 

$

(0.18)

 

$

(0.40)

 

$

(0.27)

 

 

 

 

 

 

 

 

 

Other comprehensive (loss) income:

 

 

 

 

 

 

 

 

Net loss

 

$

(27,161)

 

$

(25,403)

 

$

(55,851)

 

$

(38,306)

Foreign currency translation adjustments

 

 

4,862

 

 

(20,425)

 

 

(21,182)

 

 

(54,143)

Total comprehensive loss

 

$

(22,299)

 

$

(45,828)

 

$

(77,033)

 

$

(92,449)

Comprehensive loss attributable to non-controlling interests

 

 

174

 

 

121

 

 

321

 

 

298

Comprehensive loss attributable to stockholders

 

$

(22,125)

 

$

(45,707)

 

$

(76,712)

 

$

(92,151)

 

FREYR BATTERY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

Six months ended

June 30,

 

 

 

2024

 

 

2023

Cash flows from operating activities:

 

 

 

 

Net loss

 

$

(55,851)

 

$

(38,306)

Adjustments to reconcile net loss to cash used in operating activities:

 

 

 

 

Share-based compensation expense

 

 

5,044

 

 

5,201

Depreciation and amortization

 

 

4,578

 

 

732

Reduction in the carrying amount of right-of-use assets

 

 

732

 

 

491

Warrant liability fair value adjustment

 

 

(198)

 

 

1,151

Share of net loss of equity method investee

 

 

334

 

 

55

Foreign currency transaction net unrealized gain

 

 

(1,188)

 

 

(23,247)

Other

 

 

 

 

(929)

Changes in assets and liabilities:

 

 

 

 

Prepaid assets and other current assets

 

 

2,038

 

 

2,834

Accounts payable, accrued liabilities and other

 

 

1,242

 

 

19,967

Operating lease liability

 

 

(932)

 

 

(2,669)

Net cash used in operating activities

 

 

(44,201)

 

 

(34,720)

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Proceeds from the return of property and equipment deposits

 

 

22,735

 

 

Purchases of property and equipment

 

 

(29,099)

 

 

(128,361)

Investments in equity method investee

 

 

 

 

(1,655)

Purchases of other long-term assets

 

 

 

 

(1,000)

Net cash used in investing activities

 

 

(6,364)

 

 

(131,016)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Net cash provided by financing activities

 

 

 

 

 

 

 

 

 

Effect of changes in foreign exchange rates on cash, cash equivalents, and restricted cash

 

 

(3,640)

 

 

(13,520)

Net decrease in cash, cash equivalents, and restricted cash

 

 

(54,205)

 

 

(179,256)

Cash, cash equivalents, and restricted cash at beginning of period

 

 

275,742

 

 

563,045

Cash, cash equivalents, and restricted cash at end of period

 

$

221,537

 

$

383,789

 

 

 

 

 

Supplementary disclosure for non-cash activities:

 

 

 

 

Accrued purchases of property and equipment

 

$

8,908

 

$

23,085

 

 

 

 

 

Reconciliation to condensed consolidated balance sheets:

 

 

 

 

Cash and cash equivalents

 

$

219,560

 

$

334,364

Restricted cash

 

 

1,977

 

 

49,425

Cash, cash equivalents, and restricted cash

 

$

221,537

 

$

383,789

 

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