Newly-appointed Aqua Metals president Steve Cotton, who left the novel lead-acid battery recycling firm just over a year ago, has admitted the company is still working on getting its process modules to “steady state” operation— and will probably be operating as little as four of them in the coming months to get things right as the company moves to scale.
Concentrating on the technology is unlikely to improve the company’s bottom line for some time. However, the original business model was premised on being able to sell fund development through the sale of sufficient refined lead.
But Aqua Metals has reported an operating loss of US$9.2 million for the three months ended 30 June 2018— compared to an operating loss of US$8m for the corresponding period in 2017.
Included in expenses for the second quarter of 2018 were US$0.8m associated with the recent proxy fight, US$0.9m related to the resignation of the company’s former CEO and co-founder, Dr Steve Clarke, as well as a net US$0.4m charge related to amendments to its agreement with Interstate Battery.
The second quarter also saw additional expenses associated with the expansion of the company’s AquaRefining process.
The net loss for the second quarter of 2018 was US$9.9m, or (US$0.33) per diluted share, compared to a net loss of US$8.4m, or (US$0.42) per diluted share, in the second quarter of 2017.
For the six months ended 30 June 2018, the company recognised revenue of US$2.2m and had an operating loss of US$16.2m compared to US$0.6m of revenue and an operating loss of US$12.5m in the prior year period. The net loss for the first six months of 2018 was US$17.5m, or (US$0.59) per diluted share, compared to a net loss of US $13.3m, or (US$0.69) per diluted share for the first six months of 2017.
Cotton said the company had changed its view on how the recycling business model would develop, with co-location of modules with existing recycling operations. He added: “Parallel to our efforts to increase production, we are also focused on improving contribution and gross margins. We are in the process of implementing a number of planned capital improvement projects that will allow us to increase utilisation rates and limit downtime as we work on improving contribution margins, which we believe is necessary before we scale up to 16 modules.”