Electriq Power Holdings, Inc. (“Electriq”) (NYSE:ELIQ), a
trusted provider of intelligent energy storage and management
solutions for homes and small businesses, today announces its
financial results for the quarter ended September 30, 2023.
Quarterly Financial
Highlights:
- Net Revenues of $0.8 million
- Operating Expenses of $7.1 million
- Net loss of $20.0 million (inclusive of $14.9 million in
unrealized fair value adjustments)
- Adjusted EBITDA* of ($3.3) million, representing a $5.1 million
improvement compared to the second quarter 2023, primarily as a
result of the finalization of a contract termination
settlement
- No outstanding debt obligations as of September 30, 2023
- Reached settlement with former customer to return over $6
million in (finished goods) inventory, resulting in Electriq having
over 12 months of battery supply on-hand
*Adjusted EBITDA is a non-GAAP measure and a reconciliation
table for this non-GAAP measure to the GAAP Net Loss, the most
directly comparable financial measure, is included at the end of
this press release.
Subsequent Highlights and
Developments:
- Announced Derby, CT as first Sustainable Community Network
(“SCN”) outside of California
- Successfully validated capabilities with first Virtual Power
Plant (“VPP”) in California’s new Demand Side Grid Support
program
- Mutual collaboration with Meteora by entering into a binding
term sheet to equitize and extinguish the forward purchase
agreement for a fixed number of shares and warrants having a fixed
value of $3.5 million, in lieu of any cash requirement, eliminating
cash outflows and provides financing flexibility to Electriq
Frank Magnotti, CEO of Electriq commented, “We continue to see
robust demand for reliable, storable and clean power sources from
consumers and energy solutions providers alike, thanks to the
unique cost benefits, energy efficiency gains and other technology
features that our solutions-focused platform provides. We are
seeing momentum in signing Sustainable Community Networks with two
signed prior to 2023 and four signed in 2023. Consequently, our
signed power purchase agreements, now over 100, are trending
sharply higher as well. Our recent partnership with Derby,
Connecticut, which we announced earlier this month, represents our
initial SCN expansion to the East Coast, which is another large and
untapped market for us.
“Just last week, we announced the successful validation of our
technical capabilities by demonstrating compatibility with
California’s new Demand Side Grid Support program. Owners of
Electriq’s PowerPod 2 battery storage system can earn money by
discharging excess energy to the grid and help stabilize it during
periods of high demand. With Electriq’s proprietary software,
owners have the ability to ensure they’re optimizing their stored
energy to achieve the energy resilience goals they desire — from
retaining sufficient backup power and utilizing stored energy
during peak electric rates, to participating in grid services
programs.
“With over 100 signed power purchase agreements in backlog worth
approximately three million dollars as of September 30, we
anticipate higher deliveries and revenues as we enter into 2024.
While there may be some fluctuations from quarter-to-quarter, we
would expect to end 2024 at an annualized sales run-rate that is
substantially higher than where we entered the year. Thanks, in
part to a 2023 settlement with a customer that returned more than
six million dollars’ worth of finished goods inventory, we also
expect to lower procurement costs in the year ahead. In addition,
we are taking steps to right-size our cost structure to reduce our
cash needs.
“With this being our first quarter as a public company, I want
to thank everyone that has helped get us to this huge company
milestone. We look forward to the future and authoring new chapters
of progress.”
Conference Call and Webcast Management will host a live
conference call tomorrow, November 15, 2023 at 9:00 AM ET to
discuss Electriq’s financial results and provide an update on
corporate developments. The conference call will consist of
prepared remarks from Electriq’s executive management team, and a
Q&A session, beginning at 9:00 a.m. Eastern Time (6:00 a.m.
Pacific Time). Please refer to the information below for conference
call dial-in information, webcast registration, and Q&A
instructions.
Conference date: Wednesday, November 15, 9:00 AM ET
Conference dial-in: (888)-350-3870 International
dial-in: (437)-900-0985 Conference Call Name: Electriq
Power Third Quarter Conference Call, ID #9507937
The conference call will also be available through a live
webcast, available through this Live Webcast URL:
https://events.q4inc.com/attendee/513319862.
A replay will be available one hour after the call via the below
information:
Conference Call replay: US Toll Free: (800)-770-2030
International Toll: (647)-362-9199 Replay Access Code: 9507937
Replay Access: 11/15/2023 – 11/29/2023 at 11:59PM ET
About Electriq Power
Electriq (NYSE:ELIQ), founded in 2014 in Silicon Valley,
provides turnkey intelligent energy storage and management
solutions for homes and small businesses. Electriq’s solutions
deliver always-available, low-cost clean energy, even during
intermittent outages and inclement weather. Those solutions enable
cities, municipalities, and utilities to provide their constituents
with a path to sustainable and resilient sources of energy,
regardless of socio-economic status.
Cautionary Note on Forward-Looking Statements
This press release includes “forward-looking statements” within
the meaning of the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995. Certain of these
forward-looking statements can be identified by the use of words
such as “anticipate,” “believe,” “could,” “continue,” “estimate,”
“expect,” “forecast,” “intend,” “may,” “might,” “outlook,” “plan,”
“possible,” “potential,” “predict,” “project,” “scheduled,” “seek,”
“should,” “will,” “would” or similar expressions, but the absence
of these words does not mean that a statement is not
forward-looking. Forward-looking statements in this press release
include statements regarding: (i) expectations regarding the
continued demand for clean energy from our customers and energy
solutions providers, (ii) trends relating to our power purchase
agreements, including the anticipation of higher deliveries and
revenues throughout 2023 and into 2024, (iii) expectations
regarding our addressable market and opportunities for Electriq in
new geographies, (iv) the ability of our technical capabilities to
continue to be compatible with California’s new Demand Side Grid
Support program and the demand for excess energy by the grid, (v)
quarterly fluctuations and expectations regarding our 2024 sales
run-rate at both the beginning of 2024 and 2024 annualized, (vi)
expectations regarding our 2024 procurement costs, cost structure
and cash needs and (vii) expectations regarding cash outflows and
financing flexibility. These statements are based on the beliefs
and assumptions of Electriq’s management. Although Electriq
believes that its plans, intentions and expectations reflected in
or suggested by these forward-looking statements are reasonable,
Electriq cannot assure you that it will achieve or realize these
plans, intentions, or expectations. Forward-looking statements are
inherently subject to risks, uncertainties, and assumptions.
Generally, statements that are not historical facts, including
statements concerning possible or assumed future actions, business
strategies, events or results of operations, and any statements
that refer to projections, forecasts or other characterizations of
future events or circumstances, including any underlying
assumptions, are forward looking statements. These forward-looking
statements are not guarantees of performance. You should understand
that these statements are affected by factors set forth in
Electriq’s filings with the Securities and Exchange Commission
(“SEC”), including but not limited to those described under the
headings “Risk Factors” and “Cautionary Note Regarding
Forward-Looking Statements” in Amendment No. 2 to Form S-1 filed
with the SEC on November 7, 2023, and in its other filings made
with the SEC from time to time, which are available via the SEC’s
website at www.sec.gov. These filings identify and address other
important risks and uncertainties that could cause actual events
and results to differ materially from those contained in the
forward-looking statements. Forward looking statements speak only
as of the date they are made. Readers are cautioned not to put
undue reliance on forward-looking statements, and Electriq assumes
no obligation and does not intend to update or revise these
forward-looking statements, whether as a result of new information,
future events, or otherwise. Electriq does not give any assurance
that it will achieve its expectations.
ELECTRIQ POWER HOLDINGS, INC.
AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
September 30,
December 31,
2023
2022
(unaudited)
Assets
Current assets:
Cash
$
8,099,738
$
5,480,960
Accounts receivable, less allowance for
doubtful accounts of $40,449 and $30,429 as of September 30, 2023
and December 31, 2022, respectively
371,923
317,423
Inventory, net
20,929,486
13,532,475
Inventory deposits
238,068
5,182,045
Forward purchase contract asset
2,101,424
—
Prepaid expenses and other current
assets
752,391
368,117
Total current assets
32,493,030
24,881,020
Property and equipment, net
1,730,670
1,422,293
Right of use assets
3,346,958
3,241,705
Deposits
131,257
109,539
Total assets
$
37,701,915
$
29,654,557
Liabilities, mezzanine equity and
stockholders’ deficit
Current liabilities:
Current portion of loan payable
$
—
$
11,377,297
SAFE notes
—
51,600,000
Accounts payable
8,201,251
1,377,123
Warrants liability
—
14,114,411
Accrued payroll and employee benefits
2,233,598
629,773
Lease liability
718,027
347,131
Accrued expenses and other current
liabilities
2,294,996
5,196,432
Total current liabilities
13,447,872
84,642,167
Derivative warrants liability
3,039,603
—
Convertible note payable
—
5,000,000
Cumulative mandatorily redeemable
preferred stock liability
21,465,335
—
Other long-term liabilities
2,605,293
2,503,038
Total liabilities
40,558,103
92,145,205
Commitments and contingencies (Note 7)
Mezzanine equity:
Common stock; $0.0001 par value; 3,734,062
and zero shares contingently redeemable, respectively at September
30, 2023 and December 31, 2022
39,523,511
—
Stockholders’ deficit:
Common stock; $0.0001 par value;
38,020,283 and 21,902,477 shares issued and outstanding,
respectively at September 30, 2023 and December 31, 2022
3,802
2,190
Additional paid-in capital
76,075,014
42,500,855
Accumulated deficit
(118,458,233
)
(104,993,411
)
Accumulated other comprehensive loss
(282
)
(282
)
Total stockholders’ deficit
(42,379,699
)
(62,490,648
)
Total liabilities, mezzanine equity and
stockholders’ deficit
$
37,701,915
$
29,654,557
ELECTRIQ POWER HOLDINGS, INC.
AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Net revenues
$
834,262
$
5,988,248
$
1,019,207
$
15,334,583
Cost of goods sold
853,615
5,621,589
1,921,367
13,957,964
Gross (loss) profit
(19,353
)
366,659
(902,160
)
1,376,619
Operating expenses:
Research and development
1,011,633
901,058
3,147,943
2,716,351
Sales and marketing
1,308,928
909,871
3,522,731
2,790,657
General and administrative
4,806,693
2,626,179
14,235,262
6,975,600
Total operating expenses
7,127,254
4,437,108
20,905,936
12,482,608
Loss from operations
(7,146,607
)
(4,070,449
)
(21,808,096
)
(11,105,989
)
Other expense (income):
Interest expense
1,291,851
918,035
3,292,932
1,223,254
Unrealized fair value adjustments
14,895,081
5,170,186
(10,891,144
)
32,128,614
Other (income) expense, net
(3,380,090
)
4,428
(745,062
)
5,864
Loss before income taxes
(19,953,449
)
(10,163,098
)
(13,464,822
)
(44,463,721
)
Income tax expense
—
—
—
—
Net loss
(19,953,449
)
(10,163,098
)
(13,464,822
)
(44,463,721
)
Cumulative preferred stock dividends
45,803
451,895
978,752
1,283,334
Net loss attributable to common
stockholders
$
(19,999,252
)
$
(10,614,993
)
$
(14,443,574
)
$
(45,747,055
)
Net loss per share attributable to common
stockholders—basic and diluted
$
(0.74
)
$
(6.65
)
$
(1.40
)
$
(29.57
)
Weighted average number of shares of
common stock outstanding—basic and diluted
26,944,552
1,595,724
10,290,182
1,546,928
Non-GAAP Financial Metrics
This press release contains certain non-GAAP financial measures.
Generally, a non-GAAP financial measure is a numerical measure of a
company’s performance, financial position, or cash flows that
either excludes or includes amounts that are not normally excluded
or included in the most directly comparable measure calculated and
presented in accordance with GAAP. Reconciliation of each non-GAAP
financial measure to the most directly comparable GAAP financial
measure can be found in the accompanying tables. Our non-GAAP
financial measures presented are EBITDA and Adjusted EBITDA. We
define EBITDA as net loss plus interest expense, interest income
(benefit), income tax expense, depreciation and amortization and
Adjusted EBITDA as EBITDA plus the net change in the fair value of
derivatives including the change in the fair value of outstanding
notes and warrants, non-cash equity- based compensation expense and
transactions costs.
We use these non-GAAP financial measures to analyze our
operating performance and future prospects, develop internal
budgets and financial goals, and facilitate period-to-period
comparisons. We believe that these non-GAAP financial measures
reflect an additional way of viewing our operations that, when
viewed with our GAAP results, provide a more complete understanding
of factors and trends affecting our business. However, these
non-GAAP financial measures do not reflect a comprehensive system
of accounting, differ from GAAP measures with the same captions and
may differ from non-GAAP financial measures with the same or
similar captions that are used by other companies. In addition,
these non-GAAP measures have limitations in that they do not
reflect all the amounts associated with our results of operations
as determined in accordance with GAAP. As such, these non-GAAP
measures should be considered as a supplement to, and not as a
substitute for, or superior to, financial measures calculated in
accordance with GAAP.
The following table reconciles net loss to EBITDA and Adjusted
EBITDA for the three months ended September 30, 2023 and 2022,
respectively (in thousands):
Three Months Ended September
30,
2023
2022
$ Change
% Change
Net loss
$
(19,953
)
$
(10,163
)
$
(9,790
)
NM
Interest expense
1,292
918
374
41
%
Interest income
(116
)
—
(116
)
NM
Income tax expense
—
—
—
—
Depreciation and amortization
42
31
11
35
%
EBITDA
(18,735
)
(9,214
)
(9,521
)
NM
Stock-based compensation
493
287
206
72
%
Unrealized fair value adjustments
14,895
5,170
9,725
NM
Adjusted EBITDA
$
(3,347
)
$
(3,757
)
$
410
11
%
NM = Not Meaningful
The following table reconciles net loss to EBITDA and Adjusted
EBITDA for the three months ended September 30, 2023 and June 30,
2023, respectively (in thousands):
Three Months Ended
September 30, 2023
June 30, 2023
$ Change
% Change
Net loss
$
(19,953
)
$
16,522
$
(36,475
)
(221
%)
Interest expense
1,292
985
307
31
%
Interest income
(116
)
—
(116
)
NM
Income tax expense
—
—
—
—
Depreciation and amortization
42
40
2
5
%
EBITDA
(18,735
)
17,547
(36,282
)
207
%
Stock-based compensation
493
1,280
(787
)
(61
%)
Unrealized fair value adjustments
14,895
(27,260
)
42,155
NM
Adjusted EBITDA
$
(3,347
)
$
(8,433
)
$
5,086
60
%
NM = Not Meaningful
The following table reconciles net loss to EBITDA and Adjusted
EBITDA for the nine months ended September 30, 2023 and 2022,
respectively (in thousands):
Nine Months Ended September
30,
2023
2022
$ Change
% Change
Net loss
$
(13,465
)
$
(44,464
)
$
30,999
70
%
Interest expense
3,293
1,223
2,070
169
%
Interest income
(137
)
—
(137
)
NM
Income tax expense
—
—
—
—
Depreciation and amortization
123
119
4
3
%
EBITDA
(10,185
)
(43,122
)
32,936
(76
%)
Stock-based compensation
3,289
765
2,524
330
%
Unrealized fair value adjustments
(10,891
)
32,129
(43,020
)
NM
Adjusted EBITDA
$
(17,788
)
$
(10,228
)
$
(7,560
)
(74
%)
NM = Not Meaningful
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231114113582/en/
Investor Contacts: Core IR Bret Shapiro,
Bret@coreir.com
Media Contacts: Electriq Power
media@electriqpower.com
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