SLDPW Solid Power Inc

Solid Power, Inc. (Nasdaq: SLDP), a leading developer of solid-state battery technology, today announced its financial results for the second quarter ended June 30, 2023.

Recent Business Highlights

• SP2 commenced electrolyte powder production in April and is meeting internal performance and quality targets.
• Electrolyte sampling yielded positive feedback from industry leaders.
• Began large-scale production of EV cells, keeping the company on track for 2023 delivery of A-sample EV cells to partners.
• Appointed John Van Scoter as President and Chief Executive Officer.

“Solid Power has made tremendous progress furthering its technology and operational capabilities this year,” said John Van Scoter, President and Chief Executive Officer of Solid Power. “During the year to date, we continued to execute on our joint development agreements and further extended our agreement with Ford. With respect to electrolyte, the team completed the build-out of our electrolyte production line, started and began scaling up production, and is producing electrolyte that meets our internal performance and quality metrics. Most importantly, we are receiving positive feedback from industry leaders and believe there may be an opportunity to accelerate our timeline for future electrolyte sales.”

“On the cell development side, the team has significantly improved 20 Ah cell yields and recently began scaling EV cell production. We expect to deliver EV cells to BMW for testing in their demo car program over the coming quarters. We look forward to seeing our technology demonstrated in a full-sized BMW demo vehicle. Our operational focus now shifts to optimizing production processes, improving cell performance, and delivering EV cells to our partners,” Van Scoter said.

“Having spoken with our key stakeholders, I believe Solid Power has opportunities to further build upon its leadership position,” Van Scoter continued. “As CEO, I have identified near-term priorities to expand our geographic reach, mature our supply chain capabilities and elevate our investor communications as we execute towards commercialization. I firmly believe that Solid Power’s capital light business model and leading-edge technologies position the company to be a leader in transformative battery technologies and deliver long-term value for our partners, employees, and shareholders.”

Second Quarter 2023 Financial Highlights

Second quarter 2023 revenue was $4.9 million, an increase of $2.3 million compared to the second quarter of 2022, as a result of continued execution under the company’s joint development agreements. First half 2023 revenue was $8.7 million, up $3.9 million from the first half of 2022.

As expected, operating expenses were higher in the second quarter and first half of 2023 compared with the same periods in 2022. This increase was driven by accelerated investments in product development and the scaling of operations. Second quarter 2023 operating loss was $22.2 million and net loss was $12.2 million, or $0.07 per share.

Balance Sheet and Liquidity

Solid Power’s liquidity position remained strong, with June 30, 2023 total liquidity totaling $443.4 million, as shown below.

($ in thousands)				June 30, 2023			December 31, 2022
Cash and cash equivalents				$	28,439		$	50,123
Marketable securities					192,694			272,957
Long-term investments					222,255			172,974
		Total liquidity		$	443,388		$	496,054

The Company’s cash, cash equivalents and investments are held at leading global banks and are invested in grade A corporate and government securities with an average maturity of 15 months.

Second quarter and first half 2023 capital expenditures totaled $9.6 million and $21.2 million, respectively, primarily representing investments in the Company’s new electrolyte production facility.

2023 Outlook

Solid Power’s 2023 outlook and goals remained unchanged. Through the date of this release, the following milestones have been completed:

• Initiated production from Solid Power’s SP2 electrolyte production facility.
• Began delivering electrolyte to potential customers for sampling and feedback, which is ongoing.

Solid Power remains committed to delivering on the following key objectives:

• Scaling electrolyte production from SP2.
• Delivering EV cells to our joint development partners and entering the automotive qualification process.
• Continuing to improve key cell performance metrics, including energy density, pressure, cycle life, low temperature operations and safety.

As Solid Power executes on its milestones, the Company continues to expect that in 2023, cash used in operations will be between $70 million and $80 million and capital expenditures will range from $50 million to $60 million. Total cash investment is expected to range between $120 million and $140 million.

2023 revenue is expected to be in the range of $15 million to $20 million.

Webcast and Conference Call

Solid Power will host a conference call at 3:00 p.m. MT (5:00 p.m. ET) today, August 8, 2023. Participating on the call will be David Jansen, Chairperson of the Board, John Van Scoter, President and Chief Executive Officer, and Kevin Paprzycki, Chief Financial Officer.

Interested investors and other parties can listen to a webcast of the live conference call through Solid Power’s Investor Relations website at ir.solidpowerbattery.com.

The conference call can be accessed live over the phone by dialing +1-844-826-3035 (domestic) or +1-412-317-5195 (international).

A recording of the conference call will be available approximately three hours after the completion of the call at ir.solidpowerbattery.com or by dialing +1-844-512-2921 (domestic) or +1-412-317-6671 (international). The pin number for the replay is 10180212. The replay will be available until 9:59 p.m. MT (11:59 p.m. ET) on August 22, 2023.

About Solid Power, Inc.

Solid Power is developing solid-state battery technology to enable the next generation of batteries for the fast-growing EV and other markets. Solid Power’s core technology is its electrolyte material, which Solid Power believes can enable extended driving range, longer battery life, improved safety, and lower cost compared to traditional lithium-ion. Solid Power’s business model – selling its electrolyte to cell manufacturers and licensing its cell designs and manufacturing processes – distinguishes the company from many of its competitors who plan to be commercial battery manufacturers. Ultimately, Solid Power endeavors to be a leading producer and distributor of sulfide-based solid electrolyte material for powering both EVs and other applications. For more information, visit http://www.solidpowerbattery.com/.

Forward Looking Statements

All statements other than statements of present or historical fact contained herein are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including Solid Power’s or its management team’s expectations, objectives, beliefs, intentions or strategies regarding the future. When used herein, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” “plan,” “outlook,” “seek,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These statements include our financial guidance for 2023, future financial performance and our strategy, expansion plans, market opportunity, future operations, future operating results, estimated revenues, losses, projected costs, prospects, and plans and objectives of management. These forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Solid Power 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 hereof. Readers are cautioned not to put undue reliance on forward-looking statements and Solid Power cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Solid Power, including the following factors: (i) risks relating to the uncertainty of the success of our research and development efforts, including our ability to achieve the technological objectives or results that our partners require, and to commercialize our technology in advance of competing technologies; (ii) risks relating to the non-exclusive nature of our original equipment manufacturers and joint development agreement relationships; (iii) our ability to negotiate and execute supply agreements with our partners on commercially reasonable terms; (iv) rollout of our business plan and the timing of expected business milestones; (v) delays in the construction and operation of production facilities; (vi) our ability to protect our intellectual property, including in jurisdictions outside of the United States; (vii) broad market adoption of EVs and other technologies where we are able to deploy our cell technology and electrolyte material, if developed successfully; (viii) our success in retaining or recruiting, or changes required in, our officers, key employees, including technicians and engineers, or directors; (ix) risks and potential disruptions related to management and board of directors transitions; (x) changes in applicable laws or regulations; (xi) risks related to technology systems and security breaches; (xii) the possibility that we may be adversely affected by other economic, business or competitive factors, including supply chain interruptions, and may not be able to manage other risks and uncertainties; (xiii) risks relating to our status as a research and development stage company with a history of financial losses, and an expectation to incur significant expenses and continuing losses for the foreseeable future; (xiv) the termination or reduction of government clean energy and electric vehicle incentives; and (xv) changes in domestic and foreign business, market, financial, political and legal conditions. Additional information concerning these and other factors that may impact the operations and projections discussed herein can be found in the “Risk Factors” sections of Solid Power’s Annual Report on Form 10-K for the year ended December 31, 2022 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2023 and other documents filed by Solid Power from time to time with the SEC, all of which are available on 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. Solid Power gives no assurance that it will achieve its expectations.

Contact InformationKevin PaprzyckiChief Financial Officer1 (800) 799-7380investors@solidpowerbattery.com

Website: www.solidpowerbattery.com

Solid Power, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands, except par value and number of shares)
					As of
					June 30, 2023				December 31, 2022
Current assets:
	Cash and cash equivalents				$	28,439			$	50,123
	Marketable securities					192,694				272,957
	Contract receivables					5,224				1,840
	Prepaid expenses and other current assets					3,494				2,888
			Total current assets			229,851				327,808
Property, plant and equipment, net						95,076				82,761
Right-of-use operating lease asset, net						7,444				7,725
Right-of-use financing lease asset, net						938				922
Other assets						1,087				1,148
Long-term investments						222,255				172,974
Intangible assets, net						1,360				1,108
			Total assets		$	558,011			$	594,446
Current liabilities:
	Accounts payable and other accrued liabilities				$	8,065			$	11,326
	Current portion of long-term debt					-				7
	Deferred revenue					18				4,050
	Accrued compensation					4,080				4,528
	Operating lease liabilities, short-term					586				549
	Financing lease liability, short-term					308				273
			Total current liabilities			13,057				20,733
Warrant liabilities						6,791				9,117
Operating lease liabilities, long-term						8,317				8,622
Financing lease liabilities, long-term						535				602
			Total liabilities		$	28,700			$	39,074
Stockholders' equity:
	Common Stock, $0.0001 par value; 2,000,000,000 shares authorized; 178,326,890 and 176,007,184 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively					18				18
	Additional paid-in capital					583,034				577,603
	Accumulated deficit					(50,369	)			(19,090	)
	Accumulated other comprehensive loss					(3,372	)			(3,159	)
			Total stockholders' equity			529,311				555,372
			Total liabilities and stockholders' equity		$	558,011			$	594,446

Solid Power, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except number of shares and per-share amounts)
				Three Months Ended June 30,								Six Months Ended June 30,
					2023				2022				2023				2022
Revenue				$	4,906			$	2,582			$	8,698			$	4,778
Operating expenses
	Direct costs				6,897				2,987				13,171				5,017
	Research and development				14,508				8,440				26,156				15,101
	Selling, general and administrative				5,673				5,851				12,862				10,670
		Total operating expenses			27,078				17,278				52,189				30,788
Operating loss					(22,172	)			(14,696	)			(43,491	)			(26,010	)
Nonoperating income and expense
	Interest income				4,993				931				9,827				1,171
	Change in fair value of warrant liabilities				4,987				27,473				2,325				28,183
	Interest expense				(13	)			(5	)			(26	)			(10	)
		Total nonoperating income and expense			9,967				28,399				12,126				29,344
Pretax income (loss)					(12,205	)			13,703				(31,365	)			3,334
	Income tax benefit				-				36				-				13
Net (loss) income				$	(12,205	)		$	13,667			$	(31,365	)		$	3,321
Basic and diluted earnings (loss) per share				$	(0.07	)		$	0.08			$	(0.18	)		$	0.02
Weighted average shares outstanding - basic					178,063,573				174,128,230				177,502,037				173,266,760
Weighted average shares outstanding - diluted					178,063,573				174,703,533				177,502,037				173,566,001

Solid Power, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
							For the Six Months Ended June 30,
								2023				2022
Cash flows from operating activities
Net income (loss)							$	(31,365	)		$	3,321
Adjustments to reconcile net income (loss) to net cash and cash equivalents from operating activities:
	Depreciation and amortization							4,906				1,782
	Amortization of right-of-use assets							372				16
	Stock compensation expense							5,145				3,910
	Deferred taxes							-				13
	Change in fair value of warrant liabilities							(2,325	)			(28,183	)
	Amortization of premiums and accretion of discounts on marketable securities							(5,518	)			-
	Change in operating assets and liabilities that provided (used) cash and cash equivalents:
		Contract receivable						(3,383	)			(1,202	)
		Prepaid expenses and other assets						(188	)			744
		Accounts payable and other accrued liabilities						(297	)			(4,261	)
		Deferred revenue						(4,032	)			(286	)
		Accrued expenses						649				1,000
		Lease liabilities						(268	)			188
			Net cash and cash equivalents used in operating activities					(36,304	)			(22,958	)
Cash flows from investing activities
	Purchases of property, plant and equipment							(21,184	)			(30,957	)
	Purchases of marketable securities and long-term investments							(174,400	)			(212,792	)
	Proceeds from sales of marketable securities							210,329				54,819
	Purchases of intangible assets							(259	)			(228	)
			Net cash and cash equivalents provided by (used in) investing activities					14,486				(189,158	)

(Continued)

Solid Power, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(Continued, In thousands)
							For the Six Months Ended June 30,
								2023				2022
Cash flows from financing activities
	Payments of debt							(7	)			(71	)
	Proceeds from exercise of stock options							184				354
	Proceeds from issuance of common stock under ESPP							214				-
	Receivable for exercise of stock options							-				79
	Cash paid for withholding of employee taxes related to stock-based compensation							(111	)			(58	)
	Payments on finance lease liability							(146	)			(20	)
	Transaction costs							-				(12	)
			Net cash and cash equivalents provided by financing activities					134				272
Net (decrease) in cash and cash equivalents								(21,684	)			(211,844	)
Cash and cash equivalents at beginning of period								50,123				513,447
Cash and cash equivalents at end of period							$	28,439			$	301,603
Supplemental information:
Cash paid for interest								26				5
Accrued capital expenditures								3,591				8,146