Danimer Scientific, Inc. (NYSE: DNMR) (“Danimer” or the
“Company”), a leading next generation bioplastics company focused
on the development and production of biodegradable materials, today
shared consolidated information for investors to clarify
misconceptions raised in Muddy Waters’ recent short-seller
report.
Danimer Chief Executive Officer Stephen E. Croskrey said, “This
short-seller ‘research’ is an unfortunate effort to mislead Danimer
investors and generate short-term profit by raising doubt and
confusion through incorrect and unsupported allegations. Having
read the report, it’s clear that Muddy Waters doesn’t understand
our business.
“As detailed in numerous publicly available materials, Danimer
is continuing to strategically enhance its business with both
capacity and cost improvements that are expected to help drive top-
and bottom-line growth. We are committed to updating investors when
we make modifications to our plans and will continue to do so.
“By applying our formidable intellectual property and technical
know-how to build products that solve important environmental
packaging problems for global brands, we are continuing to
strengthen our business. We are confident in the future of Danimer
and will not be distracted from our mission of serving our
customers as we collectively seek to reduce the global impacts of
plastic waste.”
Manufacturing Capacity
Danimer’s core competency is developing formulations of
biodegradable resins for its customers. The Company discusses
production volumes in terms of finished pounds, rather than neat
PHA (a.k.a. “Nodax®”), because finished product is what is sold to
customers.
Prior to considering the integration of Rinnovo™ in its
formulations, Danimer has stated that finished capacity at its
Kentucky Phase I facility is 20 million finished pounds per year,
which means that the Kentucky Phase I facility’s capacity is 10
million pounds of Nodax®. The Company has previously noted that, on
average, Nodax® comprises approximately 50% of the formulation for
finished product. Through repetition and continuous improvement,
Danimer is scaling its production capacity and will continue to
manufacture as much Nodax® as possible. Because the Muddy Waters
analysis conflates these figures, below are the correct figures for
Danimer’s Kentucky Phase I facility:
- In Q1 2021, Danimer produced approximately 1.4 million pounds
of Nodax®, which equates to approximately 55% capacity utilization
for the three-month period.
- In Q2 2021, during which time Danimer completed the
debottlenecking of its facility, the Company produced approximately
1.2 million pounds of Nodax®, which equates to approximately 47%
capacity utilization for the three-month period.
- In July 2021, Danimer produced approximately 0.6 million pounds
of Nodax®, which equates to approximately 69% capacity utilization
for the one-month period.
As previously detailed and prior to considering the integration
of Rinnovo™ in the Company’s formulations, Phase II construction in
Kentucky is underway with production expected to commence in Q2
2022, adding an expected 45 million pounds of finished product (or
approximately 22.5 million pounds of Nodax®) to annual nameplate
PHA capacity.
Since acquiring the Kentucky facility in 2018, the Company’s
Georgia operations have transitioned to research and development
processes for PHA, while production capacity of PLA-based resins
remains at 100 million finished pounds for this facility.
Growth Plans
As detailed in Danimer’s Q2 earnings presentation, current plans
are to construct a standalone greenfield facility in Georgia that
is networked with a proposed p(3HP) facility utilizing the
technology acquired in the Novomer acquisition.
The following is a breakdown of future expected capacity
following the Novomer acquisition:
- Kentucky facility: approximately 32.5 million pounds of Nodax®
(following completion of Phase II construction)
- Greenfield facility: approximately 62.5 million pounds of
Nodax® (following completion of construction)
- Proposed p(3HP) facility: approximately 168.0 million pounds of
neat Rinnovo™ (p(3HP)) (following completion of construction)
When completed, the Danimer network is expected to have
production capacity of approximately 330 million pounds of finished
product resins when blended with other inputs. Danimer also expects
to have approximately 60 million pounds of Rinnovo™ remaining to
sell on a standalone basis or in formulations that don’t include
Nodax®. Muddy Waters’ analysis of projected capacity conflates neat
and finished product pounds, along with omitting the full projected
volume of p(3HP) production.
Novomer Acquisition
Danimer’s expansion plans have been publicly communicated, and
the most recent updates are available in the Company’s Q2 earnings
presentation on the Danimer website. The Company remains committed
to its strategy of working with blue-chip customers to deliver
products that help solve the global plastic waste crisis while
maximizing shareholder value.
As part of this strategy, the Company regularly evaluates
opportunities to expand production or lower capital expenditures.
Such an opportunity arose with the recent acquisition of Novomer,
which was announced after many months of extensive due diligence,
including independent third-party review, and a competitive bidding
process. Blending Novomer’s Rinnovo™ material and thermocatalytic
conversion process with Danimer’s current operations is expected to
provide increased manufacturing efficiency and greater flexibility
to meet customer needs. This acquisition was a strategic
opportunity that fully aligns with Danimer’s expansion strategy.
Full details on the acquisition are available in the Company’s
press release announcing the transaction, in the Company’s press
release noting the close of the transaction and in the Q2 earnings
materials.
Product Demand and Customer Partnerships
Global consumer brands are actively seeking compostable and
biodegradable alternatives to their traditional plastic products,
and this demand is evident in the numerous partnerships Danimer has
established. Partners including PepsiCo, Mars Wrigley, Bacardi,
Nestlé, WinCup, Eagle Beverages, Columbia Packaging Group and
UrthPact are currently working with Danimer to produce
biodegradable and compostable alternatives to plastic products.
Danimer’s customers remain enthusiastic about incorporating the
Company’s materials into its products. Most recently, PepsiCo
announced the launch of its pep+ (PepsiCo Positive) initiative,
which is focused on sustainability in its business operations. This
initiative includes an industrial compostable bag made with
Danimer’s PLA-based resins. This same bag received an industry
award for innovation from the PLASTICS Association in 2018. The bag
will also be featured with “Off The Eaten Path” snacks at Whole
Foods stores in the U.S. this month. PepsiCo also stated it is
willing to license this technology at no cost to other companies,
which should help Danimer further scale its business.
Additionally, in the first quarter of 2021, Mars Wrigley and
Danimer jointly announced a partnership to develop home compostable
packaging. According to Mars Wrigley, the first on-the-shelf
offerings of this packaging are tentatively targeted for late 2021
or early 2022 featuring the SKITTLES® brand in the U.S.
Consumers can also find drinking straws made with Danimer
materials in stores and restaurants now. WinCup collaborated with
Danimer to produce its phade® line of biodegradable drinking
straws, which are available at a growing number of restaurants
nationwide including select Dunkin’ locations. The straws are also
sold under a private label at CVS and Walmart stores.
Danimer remains committed to its mission of reducing the
environmental impacts of plastic waste and will continue to
regularly communicate updates on its operations to shareholders and
the public. For more information on the Company, visit
www.DanimerScientific.com.
About Danimer Scientific
Danimer is a pioneer in creating more sustainable, more natural
ways to make plastic products. For more than a decade, its
renewable and sustainable biopolymers have helped create plastic
products that are biodegradable and compostable and return to
nature instead of polluting our lands and waters. Danimer’s
technology can be found in a vast array of plastic end products
that people use every day. Applications for its biopolymers include
additives, aqueous coatings, fibers, filaments, films and
injection-molded articles, among others. Danimer holds more than
390 granted patents and pending patent applications in more than 20
countries for a range of manufacturing processes and biopolymer
formulations. For more information, visit
www.DanimerScientific.com.
Forward‐Looking Statements
Please note that in this press release we may use words such as
“appears,” “anticipates,” “believes,” “plans,” “expects,”
“intends,” “future,” and similar expressions which constitute
forward-looking statements within the meaning of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are made based on our expectations and
beliefs concerning future events impacting the Company and
therefore involve a number of risks and uncertainties. We caution
that forward-looking statements are not guarantees and that actual
results could differ materially from those expressed or implied in
the forward-looking statements. Potential risks and uncertainties
that could cause the actual results of operations or financial
condition of the Company to differ materially from those expressed
or implied by forward-looking statements in this release include,
but are not limited to, the overall level of consumer demand on our
products; general economic conditions and other factors affecting
consumer confidence, preferences, and behavior; disruption and
volatility in the global currency, capital, and credit markets; the
financial strength of the Company's customers; the Company's
ability to implement its business strategy, including, but not
limited to, its ability to expand its production facilities and
plants to meet customer demand for its products and the timing
thereof; risks relating to the uncertainty of the projected
financial information with respect to the Company; the ability of
the Company to execute and integrate acquisitions; changes in
governmental regulation, legislation or public opinion relating to
our products; the Company’s exposure to product liability or
product warranty claims and other loss contingencies; disruptions
and other impacts to the Company’s business, as a result of the
COVID-19 global pandemic and government actions and restrictive
measures implemented in response; stability of the Company’s
manufacturing facilities and suppliers, as well as consumer demand
for our products, in light of disease epidemics and health-related
concerns such as the COVID-19 global pandemic; the impact that
global climate change trends may have on the Company and its
suppliers and customers; the Company's ability to protect patents,
trademarks and other intellectual property rights; any breaches of,
or interruptions in, our information systems; the ability of our
information technology systems or information security systems to
operate effectively, including as a result of security breaches,
viruses, hackers, malware, natural disasters, vendor business
interruptions or other causes; our ability to properly maintain,
protect, repair or upgrade our information technology systems or
information security systems, or problems with our transitioning to
upgraded or replacement systems; the impact of adverse publicity
about the Company and/or its brands, including without limitation,
through social media or in connection with brand damaging events
and/or public perception; fluctuations in the price, availability
and quality of raw materials and contracted products as well as
foreign currency fluctuations; our ability to utilize potential net
operating loss carryforwards; and changes in tax laws and
liabilities, tariffs, legal, regulatory, political and economic
risks. More information on potential factors that could affect the
Company's financial results is included from time to time in the
Company's public reports filed with the Securities and Exchange
Commission, including the Company's Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K.
All forward-looking statements included in this press release are
based upon information available to the Company as of the date of
this press release, and speak only as of the date hereof. We assume
no obligation to update any forward-looking statements to reflect
events or circumstances after the date of this press release.
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version on businesswire.com: https://www.businesswire.com/news/home/20210917005097/en/
For Danimer: Investors ir@danimer.com Phone:
229-220-1103
Media Anthony Popiel apopiel@daltonagency.com Phone:
404-876-1309
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