MP Materials Reports Fourth Quarter and Full Year 2023 Results
Exceeded 40,000 metric tons of REO production for the third consecutive year
Commenced production of separated rare earth products
Produced 200 metric tons of NdPr oxide in 2023
Generated $253.4 million of revenue in 2023
Produced $24.3 million of net income and Adjusted EBITDA of $102.5 million in 2023
LAS VEGAS–(BUSINESS WIRE)–$MP #rareearth–MP Materials Corp. (NYSE: MP) (“MP Materials” or the “Company”) today announced its financial results for the fourth quarter and full year ended December 31, 2023.
Full Year 2023 Highlights
- Produced 41,557 metric tons of rare earth oxides (“REO”) in concentrate
- Produced 200 metric tons of NdPr oxide
- Sold 36,837 metric tons of REO, generating revenue of $253.4 million
- Produced net income of $24.3 million and Adjusted EBITDA of $102.5 million
- Ended 2023 with $997.8 million of cash, cash equivalents and short-term investments and $307.8 million of net cash on the balance sheet
- Secured significant NdPr oxide-to-metal tolling capacity to expand midstream sales opportunities
- Began installation of metal and alloy production equipment in Fort Worth, Texas, magnetics facility
- Started trial production of NdPr metal
Fourth Quarter 2023 Highlights
- Production of 9,257 metric tons of REO in concentrate
- Sales volumes of 7,174 metric tons of REO in concentrate
- Production of 150 metric tons of NdPr oxide
- Sales of 10 metric tons of NdPr oxide
“MP executed diligently throughout 2023 despite formidable market headwinds. We exceeded 40,000 tons of REO production for the third consecutive year, achieved first production and sales of NdPr, and added substantial depth to our team and capability set,” said MP Materials Chairman and CEO, James Litinsky. “Our magnetics division completed construction in Fort Worth and began trial production of rare earth metal. Given the challenging pricing environment, MP remains steadfast in our conservative approach to capital deployment while we seek to create significant shareholder value through the cycle.”
Fourth Quarter 2023 Financial and Operational Highlights
|
|
For the three months |
|
2023 vs. 2022 |
||||||||||
|
(unaudited) |
2023 |
|
2022 |
|
Amount |
|
% Change |
||||||
|
Financial Measures: |
(in thousands, except per share data) |
|
|
||||||||||
|
Revenue(1) |
$ |
41,205 |
|
|
$ |
93,245 |
|
$ |
(52,040 |
) |
|
(56 |
)% |
|
Net income (loss) |
$ |
(16,259 |
) |
|
$ |
67,007 |
|
$ |
(83,266 |
) |
|
N/M |
|
|
Adjusted EBITDA(2) |
$ |
1,300 |
|
|
$ |
55,050 |
|
$ |
(53,750 |
) |
|
(98 |
)% |
|
Adjusted Net Income (Loss)(2) |
$ |
(3,998 |
) |
|
$ |
78,786 |
|
$ |
(82,784 |
) |
|
N/M |
|
|
Diluted EPS |
$ |
(0.09 |
) |
|
$ |
0.36 |
|
$ |
(0.45 |
) |
|
N/M |
|
|
Adjusted Diluted EPS(2) |
$ |
(0.02 |
) |
|
$ |
0.42 |
|
$ |
(0.44 |
) |
|
N/M |
|
|
|
|
|
|
|
|
|
|
||||||
|
Key Performance Indicators (“KPIs”)(3): |
(in whole units or dollars) |
|
|
||||||||||
|
Rare earth concentrate |
|
|
|
|
|
|
|
||||||
|
REO Production Volume (MTs) |
|
9,257 |
|
|
|
10,485 |
|
|
(1,228 |
) |
|
(12 |
)% |
|
REO Sales Volume (MTs) |
|
7,174 |
|
|
|
10,816 |
|
|
(3,642 |
) |
|
(34 |
)% |
|
Realized Price per REO MT |
$ |
5,622 |
|
|
$ |
8,515 |
|
$ |
(2,893 |
) |
|
(34 |
)% |
|
Production Cost per REO MT(2) |
$ |
2,393 |
|
|
$ |
1,928 |
|
$ |
465 |
|
|
24 |
% |
|
Separated NdPr products |
|
|
|
|
|
|
|
||||||
|
NdPr Production Volume (MTs) |
|
150 |
|
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
NdPr Sales Volume (MTs) |
|
10 |
|
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
NdPr Realized Price per KG |
$ |
70 |
|
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/M = Not meaningful. |
||
|
N/A = Not applicable as there was neither NdPr production nor sales volume in the three months ended December 31, 2022. |
||
|
(1) |
The vast majority of the Company’s revenue pertains to sales of its rare earth concentrate product. | |
|
(2) |
See “Use of Non-GAAP Financial Measures” below for the definitions of Adjusted EBITDA, Adjusted Net Income (Loss), Adjusted Diluted EPS and Production Costs, which is used in the calculation of Production Cost per REO MT. Beginning with the first quarter of 2024, the Company will no longer present Production Cost per REO MT, which is a metric focused solely on concentrate production, and accordingly, Production Costs. See tables below for reconciliations of non-GAAP financial measures to their most directly comparable GAAP financial measures. | |
|
(3) |
During 2023, upon production of separated products, management identified three new KPIs of the Company’s business. See “Key Performance Indicators” below for definitions and further information. | |
Revenue declined 56% year-over-year, due to a 34% decrease in sales volumes as well as a 34% decline in realized sales prices of REO in concentrate. The 34% decrease in metric tons (“MTs”) sold was mainly due to the transition to midstream production of NdPr oxide as well as slightly lower upstream production volumes. The 34% decline in realized prices was mainly due to the significantly softer pricing environment for rare earth products as compared to the prior year period. The softer pricing was mostly driven by lower growth in magnetic products demand. The 12% decrease in production volumes compared to the fourth quarter of 2022 was due to a higher unplanned downtime in the current quarter.
Adjusted EBITDA declined 98% year-over-year, driven by lower per-unit profitability, as well as higher personnel and other general and administrative costs. The per-unit profitability decline was driven primarily by the lower realized prices discussed above, as well as higher production costs per MT. Production cost of $2,393 per MT of REO increased 24% year-over-year mainly due to the descaling impact of lower REO sales, a longer and more detailed plant turnaround and higher payroll costs year-over-year from the implementation of our Stage II strategy. Also impacting the comparison was a write-down of $2.3 million on certain inventories attributable to elevated carrying costs of initial production of separated products. Higher general and administrative costs were driven by higher corporate personnel and infrastructure costs required to further build out our corporate infrastructure in support of our downstream expansion.
In the quarter, the Company recorded an Adjusted Net Loss of $4.0 million compared to Adjusted Net Income of $78.8 million in the prior year period. The change was primarily driven by the lower Adjusted EBITDA as well as higher depreciation expense and a lower income tax benefit in the current quarter. Higher depreciation expense resulted from an increase in capital assets placed into service over the last year, mostly related to Stage II refining upgrades. The change in income tax benefit was primarily due to a tax benefit derived from the timing of capital assets placed into service and the related impact on certain other deductions in the prior year period. Also impacting the comparison was higher interest and investment income earned in the current quarter.
Net loss was $16.3 million compared to net income of $67.0 million in the prior year period. The change was driven by the trends discussed above impacting Adjusted Net Income/(Loss) in addition to higher start-up and transaction costs in the current quarter compared to last year.
Diluted EPS was $(0.09) and Adjusted Diluted EPS was $(0.02) in the current quarter mainly due to the change from net income to a net loss and Adjusted Net Income to Adjusted Net Loss, respectively, as discussed above.
Full Year 2023 Financial and Operational Highlights
|
|
For the year ended |
|
2023 vs. 2022 |
|||||||||
|
(unaudited) |
2023 |
|
2022 |
|
Amount |
|
% Change |
|||||
|
Financial Measures: |
(in thousands, except per share data) |
|
|
|||||||||
|
Revenue(1) |
$ |
253,445 |
|
$ |
527,510 |
|
$ |
(274,065 |
) |
|
(52 |
)% |
|
Net income |
$ |
24,307 |
|
$ |
289,004 |
|
$ |
(264,697 |
) |
|
(92 |
)% |
|
Adjusted EBITDA(2) |
$ |
102,502 |
|
$ |
388,631 |
|
$ |
(286,129 |
) |
|
(74 |
)% |
|
Adjusted Net Income(2) |
$ |
71,378 |
|
$ |
320,557 |
|
$ |
(249,179 |
) |
|
(78 |
)% |
|
Diluted EPS |
$ |
0.14 |
|
$ |
1.52 |
|
$ |
(1.38 |
) |
|
(91 |
)% |
|
Adjusted Diluted EPS(2) |
$ |
0.39 |
|
$ |
1.68 |
|
$ |
(1.29 |
) |
|
(77 |
)% |
|
|
|
|
|
|
|
|
|
|||||
|
Key Performance Indicators:(3) |
(in whole units or dollars) |
|
|
|||||||||
|
Rare earth concentrate |
|
|
|
|
|
|
|
|||||
|
REO Production Volume (MTs) |
|
41,557 |
|
|
42,499 |
|
|
(942 |
) |
|
(2 |
)% |
|
REO Sales Volume (MTs) |
|
36,837 |
|
|
43,198 |
|
|
(6,361 |
) |
|
(15 |
)% |
|
Realized Price per REO MT |
$ |
6,854 |
|
$ |
11,974 |
|
$ |
(5,120 |
) |
|
(43 |
)% |
|
Production Cost per REO MT(2) |
$ |
2,058 |
|
$ |
1,728 |
|
$ |
330 |
|
|
19 |
% |
|
Separated NdPr products |
|
|
|
|
|
|
|
|||||
|
NdPr Production Volume (MTs) |
|
200 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
NdPr Sales Volume (MTs) |
|
10 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
NdPr Realized Price per KG |
$ |
70 |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/M = Not meaningful. |
||
|
N/A = Not applicable as there was neither NdPr production nor sales volume in the year ended December 31, 2022. |
||
|
(1) |
The vast majority of the Company’s revenue pertains to sales of its rare earth concentrate product. | |
|
(2) |
See “Use of Non-GAAP Financial Measures” below for the definitions of Adjusted EBITDA, Adjusted Net Income, Adjusted Diluted EPS and Production Costs, which is used in the calculation of Production Cost per REO MT. Beginning with the first quarter of 2024, the Company will no longer present Production Cost per REO MT, which is a metric focused solely on concentrate production, and accordingly, Production Costs. See tables below for reconciliations of non-GAAP financial measures to their most directly comparable GAAP financial measures. | |
|
(3) |
During 2023, upon production of separated products, management identified three new KPIs of the Company’s business. See “Key Performance Indicators” below for definitions and further information. | |
Revenue declined 52% year-over-year, driven by a decrease in the realized sales prices of REO in concentrate as well as lower volumes sold. The 43% decrease in realized sales price was primarily due to lower growth in magnetic products demand, which negatively impacted the price of REO. The 15% decrease in MTs sold was mainly due to the start-up of Stage II operations as a significant portion of REO produced during the year was used to charge the Stage II circuits, establish separations work-in-process inventory, or produce packaged and finished separated rare earth products, instead of being sold as REO in concentrate. Production volumes were down slightly in 2023 mainly due to higher unplanned downtime in the fourth quarter.
Adjusted EBITDA decreased 74% year-over-year, driven by lower per-unit profitability, decreased sales volumes, as well as higher personnel and other general and administrative costs. Per-unit profitability was impacted by the lower realized prices discussed above, as well as higher production costs per MT of REO. Production cost of $2,058 per MT of REO increased 19% year-over-year, mainly driven by higher payroll costs, including the increase in employee headcount to support the expansion of operations, and to a lesser extent, higher materials and supplies costs as well as higher property and other taxes. Also impacting the comparison was a write-down of $2.3 million on certain inventories attributable to elevated carrying costs of initial production of separated products. Higher general and administrative costs were driven by higher corporate personnel and infrastructure costs required to further build out corporate infrastructure in support of our downstream expansion.
Adjusted Net Income was $71.4 million compared to $320.6 million in the prior year. The change was mainly due to the lower Adjusted EBITDA discussed above, as well as higher depreciation expense resulting from an increase in capital assets placed into service over the last year, mostly related to Stage II refining upgrades. Also impacting the comparison was higher interest and investment income earned, and lower income tax expense mostly related to the lower pre-tax income.
Net income was $24.3 million compared to $289.0 million in the prior year, driven primarily by the change in Adjusted Net Income discussed above, as well as higher start-up, transaction and demolition costs in 2023. Net income in 2023 was also impacted by lower stock-based compensation expense. Diluted EPS declined 91% year-over-year to $0.14 and Adjusted Diluted EPS decreased 77% to $0.39, both mainly due to the decrease in net income and Adjusted Net Income discussed above.
|
MP MATERIALS CORP. AND SUBSIDIARIES |
|||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
|
|
|
|
|
||
|
|
December 31, |
||||
|
(in thousands, except share and per share data, unaudited) |
2023 |
|
2022 |
||
|
Assets |
|
|
|
||
|
Current assets |
|
|
|
||
|
Cash and cash equivalents |
$ |
263,351 |
|
$ |
136,627 |
|
Short-term investments |
|
734,493 |
|
|
1,045,718 |
|
Total cash, cash equivalents and short-term investments |
|
997,844 |
|
|
1,182,345 |
|
Accounts receivable |
|
10,029 |
|
|
32,856 |
|
Inventories |
|
95,182 |
|
|
57,554 |
|
Government grant receivable |
|
19,302 |
|
|
— |
|
Prepaid expenses and other current assets |
|
8,820 |
|
|
21,073 |
|
Total current assets |
|
1,131,177 |
|
|
1,293,828 |
|
Non-current assets |
|
|
|
||
|
Property, plant and equipment, net |
|
1,158,054 |
|
|
935,743 |
|
Operating lease right-of-use assets |
|
10,065 |
|
|
99 |
|
Inventories |
|
13,350 |
|
|
5,744 |
|
Equity method investment |
|
9,673 |
|
|
— |
|
Intangible assets, net |
|
8,881 |
|
|
89 |
|
Other non-current assets |
|
5,252 |
|
|
2,284 |
|
Total non-current assets |
|
1,205,275 |
|
|
943,959 |
|
Total assets |
$ |
2,336,452 |
|
$ |
2,237,787 |
|
Liabilities and stockholders’ equity |
|
|
|
||
|
Current liabilities |
|
|
|
||
|
Accounts and construction payable |
$ |
27,995 |
|
$ |
15,326 |
|
Accrued liabilities |
|
73,939 |
|
|
56,939 |
|
Income taxes payable |
|
— |
|
|
21,163 |
|
Other current liabilities |
|
6,616 |
|
|
4,053 |
|
Total current liabilities |
|
108,550 |
|
|
97,481 |
|
Non-current liabilities |
|
|
|
||
|
Asset retirement obligations |
|
5,518 |
|
|
5,295 |
|
Environmental obligations |
|
16,545 |
|
|
16,580 |
|
Long-term debt, net |
|
681,980 |
|
|
678,444 |
|
Operating lease liabilities |
|
6,829 |
|
|
15 |
|
Deferred government grant |
|
17,433 |
|
|
— |
|
Deferred income taxes |
|
130,793 |
|
|
122,353 |
|
Other non-current liabilities |
|
3,025 |
|
|
4,985 |
|
Total non-current liabilities |
|
862,123 |
|
|
827,672 |
|
Total liabilities |
|
970,673 |
|
|
925,153 |
|
Commitments and contingencies |
|
|
|
||
|
Stockholders’ equity: |
|
|
|
||
|
Preferred stock ($0.0001 par value, 50,000,000 shares authorized, none issued and outstanding in either year) |
|
— |
|
|
— |
|
Common stock ($0.0001 par value, 450,000,000 shares authorized, 178,082,383 and 177,706,608 shares issued and outstanding, as of December 31, 2023 and December 31, 2022, respectively) |
|
17 |
|
|
18 |
|
Additional paid-in capital |
|
979,891 |
|
|
951,008 |
|
Retained earnings |
|
385,726 |
|
|
361,419 |
|
Accumulated other comprehensive income |
|
145 |
|
|
189 |
|
Total stockholders’ equity |
|
1,365,779 |
|
|
1,312,634 |
|
Total liabilities and stockholders’ equity |
$ |
2,336,452 |
|
$ |
2,237,787 |
|
MP MATERIALS CORP. AND SUBSIDIARIES |
|||||||||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
For the three months |
|
For the year ended |
||||||||||||
|
(in thousands, except share and per share data, unaudited) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
Revenue: |
|
|
|
|
|
|
|
||||||||
|
Rare earth concentrate |
$ |
40,329 |
|
|
$ |
92,098 |
|
|
$ |
252,468 |
|
|
$ |
517,267 |
|
|
NdPr oxide and metal |
|
695 |
|
|
|
— |
|
|
|
695 |
|
|
|
— |
|
|
Other rare earth products |
|
181 |
|
|
|
1,147 |
|
|
|
282 |
|
|
|
10,243 |
|
|
Total revenue |
|
41,205 |
|
|
|
93,245 |
|
|
|
253,445 |
|
|
|
527,510 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Operating costs and expenses: |
|
|
|
|
|
|
|
||||||||
|
Cost of sales (excluding depreciation, depletion and amortization) |
|
23,577 |
|
|
|
24,536 |
|
|
|
92,714 |
|
|
|
92,218 |
|
|
Selling, general and administrative |
|
21,416 |
|
|
|
19,707 |
|
|
|
79,245 |
|
|
|
75,857 |
|
|
Depreciation, depletion and amortization |
|
18,633 |
|
|
|
5,593 |
|
|
|
55,709 |
|
|
|
18,356 |
|
|
Start-up costs |
|
5,205 |
|
|
|
3,782 |
|
|
|
21,330 |
|
|
|
7,551 |
|
|
Advanced projects and development |
|
5,346 |
|
|
|
1,806 |
|
|
|
14,932 |
|
|
|
4,249 |
|
|
Other operating costs and expenses |
|
656 |
|
|
|
355 |
|
|
|
7,234 |
|
|
|
1,868 |
|
|
Total operating costs and expenses |
|
74,833 |
|
|
|
55,779 |
|
|
|
271,164 |
|
|
|
200,099 |
|
|
Operating income (loss) |
|
(33,628 |
) |
|
|
37,466 |
|
|
|
(17,719 |
) |
|
|
327,411 |
|
|
Interest expense, net |
|
(1,107 |
) |
|
|
(1,331 |
) |
|
|
(5,254 |
) |
|
|
(5,786 |
) |
|
Other income, net |
|
14,078 |
|
|
|
10,953 |
|
|
|
56,048 |
|
|
|
19,527 |
|
|
Income (loss) before income taxes |
|
(20,657 |
) |
|
|
47,088 |
|
|
|
33,075 |
|
|
|
341,152 |
|
|
Income tax benefit (expense) |
|
4,398 |
|
|
|
19,919 |
|
|
|
(8,768 |
) |
|
|
(52,148 |
) |
|
Net income (loss) |
$ |
(16,259 |
) |
|
$ |
67,007 |
|
|
$ |
24,307 |
|
|
$ |
289,004 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Earnings (loss) per share: |
|
|
|
|
|
|
|
||||||||
|
Basic |
$ |
(0.09 |
) |
|
$ |
0.38 |
|
|
$ |
0.14 |
|
|
$ |
1.64 |
|
|
Diluted |
$ |
(0.09 |
) |
|
$ |
0.36 |
|
|
$ |
0.14 |
|
|
$ |
1.52 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Weighted-average shares outstanding: |
|
|
|
|
|
|
|
||||||||
|
Basic |
|
177,619,628 |
|
|
|
176,646,587 |
|
|
|
177,181,661 |
|
|
|
176,519,203 |
|
|
Diluted |
|
177,619,628 |
|
|
|
193,494,131 |
|
|
|
178,152,212 |
|
|
|
193,453,087 |
|
|
MP MATERIALS CORP. AND SUBSIDIARIES |
|||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
|
|
|
|
|
||||
|
|
For the year ended |
||||||
|
(in thousands, unaudited) |
|
2023 |
|
|
|
2022 |
|
|
Operating activities: |
|
|
|
||||
|
Net income |
$ |
24,307 |
|
|
$ |
289,004 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
|
Depreciation, depletion and amortization |
|
55,709 |
|
|
|
18,356 |
|
|
Accretion of asset retirement and environmental obligations |
|
908 |
|
|
|
1,477 |
|
|
Accretion of discount on short-term investments |
|
(26,316 |
) |
|
|
(9,958 |
) |
|
Loss on disposals of long-lived assets, net |
|
808 |
|
|
|
391 |
|
|
Stock-based compensation expense |
|
25,236 |
|
|
|
31,780 |
|
|
Accretion of debt discount and amortization of debt issuance costs |
|
3,536 |
|
|
|
4,034 |
|
|
Write-down of inventories |
|
2,285 |
|
|
|
— |
|
|
Revenue recognized in exchange for debt principal reduction |
|
— |
|
|
|
(13,566 |
) |
|
Deferred income taxes |
|
8,455 |
|
|
|
17,789 |
|
|
Decrease (increase) in operating assets: |
|
|
|
||||
|
Accounts receivable |
|
22,827 |
|
|
|
18,153 |
|
|
Inventories |
|
(47,099 |
) |
|
|
(24,314 |
) |
|
Government grant receivable |
|
(19,302 |
) |
|
|
— |
|
|
Prepaid expenses, other current and non-current assets |
|
2,377 |
|
|
|
(8,223 |
) |
|
Increase (decrease) in operating liabilities: |
|
|
|
||||
|
Accounts payable and accrued liabilities |
|
11,305 |
|
|
|
1,962 |
|
|
Income taxes payable |
|
(21,163 |
) |
|
|
17,700 |
|
|
Deferred government grant |
|
19,120 |
|
|
|
— |
|
|
Other current and non-current liabilities |
|
(294 |
) |
|
|
(1,071 |
) |
|
Net cash provided by operating activities |
|
62,699 |
|
|
|
343,514 |
|
|
Investing activities: |
|
|
|
||||
|
Additions to property, plant and equipment |
|
(261,897 |
) |
|
|
(326,595 |
) |
|
Purchases of short-term investments |
|
(1,185,477 |
) |
|
|
(2,779,666 |
) |
|
Proceeds from sales of short-term investments |
|
507,736 |
|
|
|
1,463,160 |
|
|
Proceeds from maturities of short-term investments |
|
1,015,190 |
|
|
|
281,000 |
|
|
Investment in equity method investee |
|
(9,673 |
) |
|
|
— |
|
|
Proceeds from sale of property, plant and equipment |
|
18 |
|
|
|
— |
|
|
Proceeds from government awards used for construction |
|
2,800 |
|
|
|
5,130 |
|
|
Net cash provided by (used in) investing activities |
|
68,697 |
|
|
|
(1,356,971 |
) |
|
Financing activities: |
|
|
|
||||
|
Principal payments on debt obligations and finance leases |
|
(2,732 |
) |
|
|
(5,834 |
) |
|
Tax withholding on stock-based awards |
|
(7,185 |
) |
|
|
(18,357 |
) |
|
Net cash used in financing activities |
|
(9,917 |
) |
|
|
(24,191 |
) |
|
Net change in cash, cash equivalents and restricted cash |
|
121,479 |
|
|
|
(1,037,648 |
) |
|
Cash, cash equivalents and restricted cash beginning balance |
|
143,509 |
|
|
|
1,181,157 |
|
|
Cash, cash equivalents and restricted cash ending balance |
$ |
264,988 |
|
|
$ |
143,509 |
|
|
|
|
|
|
||||
|
Reconciliation of cash, cash equivalents and restricted cash: |
|
|
|
||||
|
Cash and cash equivalents |
$ |
263,351 |
|
|
$ |
136,627 |
|
|
Restricted cash, current |
|
1,290 |
|
|
|
6,287 |
|
|
Restricted cash, non-current |
|
347 |
|
|
|
595 |
|
|
Total cash, cash equivalents and restricted cash |
$ |
264,988 |
|
|
$ |
143,509 |
|
|
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted EBITDA |
|||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
For the three months |
|
For the year ended |
||||||||||||
|
(in thousands, unaudited) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
Net income (loss) |
$ |
(16,259 |
) |
|
$ |
67,007 |
|
|
$ |
24,307 |
|
|
$ |
289,004 |
|
|
Adjusted for: |
|
|
|
|
|
|
|
||||||||
|
Depreciation, depletion and amortization |
|
18,633 |
|
|
|
5,593 |
|
|
|
55,709 |
|
|
|
18,356 |
|
|
Interest expense, net |
|
1,107 |
|
|
|
1,331 |
|
|
|
5,254 |
|
|
|
5,786 |
|
|
Income tax expense (benefit) |
|
(4,398 |
) |
|
|
(19,919 |
) |
|
|
8,768 |
|
|
|
52,148 |
|
|
Stock-based compensation expense(1) |
|
6,195 |
|
|
|
6,761 |
|
|
|
25,236 |
|
|
|
31,780 |
|
|
Initial start-up costs(2) |
|
5,133 |
|
|
|
3,729 |
|
|
|
20,607 |
|
|
|
7,432 |
|
|
Transaction-related and other costs(3) |
|
4,311 |
|
|
|
1,146 |
|
|
|
11,435 |
|
|
|
1,784 |
|
|
Accretion of asset retirement and environmental obligations(4) |
|
227 |
|
|
|
222 |
|
|
|
908 |
|
|
|
1,477 |
|
|
Loss on disposals of long-lived assets, net(4)(5) |
|
429 |
|
|
|
133 |
|
|
|
6,326 |
|
|
|
391 |
|
|
Other income, net(6) |
|
(14,078 |
) |
|
|
(10,953 |
) |
|
|
(56,048 |
) |
|
|
(19,527 |
) |
|
Adjusted EBITDA |
$ |
1,300 |
|
|
$ |
55,050 |
|
|
$ |
102,502 |
|
|
$ |
388,631 |
|
|
(1) |
Principally included in “Selling, general and administrative” within our unaudited Condensed Consolidated Statements of Operations. | |
|
(2) |
Included in “Start-up costs” within our unaudited Condensed Consolidated Statements of Operations and excludes any applicable stock-based compensation, which is included in the “Stock-based compensation expense” line above. Relates to certain costs incurred in connection with the commissioning and starting up of our initial separations capability at Mountain Pass and our initial magnet-making capabilities at Fort Worth prior to the achievement of commercial production. These costs include labor of incremental employees hired in advance to work directly on such commissioning activities, training costs, costs of testing and commissioning the new circuits and processes, and other related costs. Given the nature and scale of the related costs and activities, management does not view these as normal, recurring operating expenses, but rather as non-recurring investments to initially develop our separations and magnet-making capabilities. Therefore, we believe it is useful and necessary for investors to understand our core operating performance in current and future periods by excluding the impact of these start-up costs. To the extent additional start-up costs are incurred in the future to expand our separations and magnet-making capabilities after initial achievement of commercial production (e.g., significantly expanding production capacity at an existing facility or building a new separations or magnet manufacturing facility), such costs would not be considered an adjustment for this non-GAAP financial measure. | |
|
(3) |
Principally included in “Advanced projects and development” within our unaudited Condensed Consolidated Statements of Operations, and pertains to legal, consulting, and advisory services, and other costs associated with specific transactions, including potential acquisitions, mergers, or other investments. | |
|
(4) |
Included in “Other operating costs and expenses” within our unaudited Condensed Consolidated Statements of Operations. | |
|
(5) |
The year ended December 31, 2023, includes $5.5 million in demolition costs associated with demolishing and removing certain out-of-use older facilities and infrastructure from the Mountain Pass site to accommodate future expansion in rare earth processing. | |
|
(6) |
Principally comprised of interest and investment income. | |
|
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income (Loss) |
|||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
For the three months |
|
For the year ended |
||||||||||||
|
(in thousands, unaudited) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
Net income (loss) |
$ |
(16,259 |
) |
|
$ |
67,007 |
|
|
$ |
24,307 |
|
|
$ |
289,004 |
|
|
Adjusted for: |
|
|
|
|
|
|
|
||||||||
|
Stock-based compensation expense(1) |
|
6,195 |
|
|
|
6,761 |
|
|
|
25,236 |
|
|
|
31,780 |
|
|
Initial start-up costs(2) |
|
5,133 |
|
|
|
3,729 |
|
|
|
20,607 |
|
|
|
7,432 |
|
|
Transaction-related and other costs(3) |
|
4,311 |
|
|
|
1,146 |
|
|
|
11,435 |
|
|
|
1,784 |
|
|
Loss on disposals of long-lived assets, net(4)(5) |
|
429 |
|
|
|
133 |
|
|
|
6,326 |
|
|
|
391 |
|
|
Other |
|
(9 |
) |
|
|
(26 |
) |
|
|
(51 |
) |
|
|
(273 |
) |
|
Tax impact of adjustments above(6) |
|
(3,798 |
) |
|
|
454 |
|
|
|
(16,482 |
) |
|
|
(6,716 |
) |
|
Release of valuation allowance |
|
— |
|
|
|
(418 |
) |
|
|
— |
|
|
|
(2,845 |
) |
|
Adjusted Net Income (Loss) |
$ |
(3,998 |
) |
|
$ |
78,786 |
|
|
$ |
71,378 |
|
|
$ |
320,557 |
|
|
(1) |
Principally included in “Selling, general and administrative” within our unaudited Condensed Consolidated Statements of Operations. | |
|
(2) |
Included in “Start-up costs” within our unaudited Condensed Consolidated Statements of Operations and excludes any applicable stock-based compensation, which is included in the “Stock-based compensation expense” line above. Relates to certain costs incurred in connection with the commissioning and starting up of our initial separations capability at Mountain Pass and our initial magnet-making capabilities at Fort Worth prior to the achievement of commercial production. These costs include labor of incremental employees hired in advance to work directly on such commissioning activities, training costs, costs of testing and commissioning the new circuits and processes, and other related costs. Given the nature and scale of the related costs and activities, management does not view these as normal, recurring operating expenses, but rather as non-recurring investments to initially develop our separations and magnet-making capabilities. Therefore, we believe it is useful and necessary for investors to understand our core operating performance in current and future periods by excluding the impact of these start-up costs. To the extent additional start-up costs are incurred in the future to expand our separations and magnet-making capabilities after initial achievement of commercial production (e.g., significantly expanding production capacity at an existing facility or building a new separations or magnet manufacturing facility), such costs would not be considered an adjustment for this non-GAAP financial measure. | |
|
(3) |
Principally included in “Advanced projects and development” within our unaudited Condensed Consolidated Statements of Operations, and pertains to legal, consulting, and advisory services, and other costs associated with specific transactions, including potential acquisitions, mergers, or other investments. | |
|
(4) |
Included in “Other operating costs and expenses” within our unaudited Condensed Consolidated Statements of Operations. | |
|
(5) |
The year ended December 31, 2023, includes $5.5 million in demolition costs associated with demolishing and removing certain out-of-use older facilities and infrastructure from the Mountain Pass site to accommodate future expansion in rare earth processing. | |
|
(6) |
Tax impact of adjustments is calculated using an adjusted effective tax rate, which excludes the impact of discrete tax costs and benefits, to each adjustment. The adjusted effective tax rates were 23.7%, 25.9%, (3.9)% and 16.3%, for the three months and years ended December 31, 2023 and 2022, respectively. | |
Contacts
Investors:
[email protected]
Media:
Matt Sloustcher
[email protected]
