Montana Technologies Announces First Quarter 2024 Results
Montana Technologies (NASDAQ: AIRJ) reported first quarter 2024 results, highlighting the completion of a business combination with Legacy Montana and a capital raise exceeding $50 million led by Carrier Global, Rice Investment Group, and GE Vernova. The company formed a joint venture with GE Vernova to advance AirJoule® technology for HVAC and water harvesting solutions and entered into commercialization agreements with Carrier. Montana Technologies ended the quarter with $37 million in cash. Key appointments to the board and executive team were announced, and the company's common stock and warrants began trading under 'AIRJ' and 'AIRJW' on Nasdaq.
- Business combination completed with Legacy Montana, enhancing market presence.
- Capital raise exceeded $50 million, led by notable investors like Carrier Global, Rice Investment Group, and GE Vernova.
- Joint venture with GE Vernova to commercialize AirJoule® technology for HVAC and water harvesting.
- Entered commercialization agreements with Carrier for AirJoule® technology in HVAC equipment.
- Ended Q1 2024 with $37 million in cash, providing financial stability.
- New board and executive appointments bring extensive industry experience.
- Stock and warrants began trading on Nasdaq, increasing market visibility.
- No revenue or earnings figures provided, limiting financial transparency.
- High dependency on joint ventures and commercialization agreements for future growth.
- Potential dilution of share value due to new stock and warrant issuances.
Insights
Montana Technologies' recent developments present substantial implications for investors. First, the successful
The company ended the quarter with
Listing on the Nasdaq also enhances the company's visibility and credibility in the public markets, potentially attracting more institutional investors and increasing liquidity. However, it's essential to monitor how well the company manages its capital and executes its strategic plans, particularly given the competitive nature of the HVAC and water harvesting markets.
Overall, these developments improve Montana Technologies' financial stability and growth prospects, though the execution risks remain.
The formation of a joint venture with GE Vernova and the commercialization agreement with Carrier signify that Montana Technologies is securing strategic partnerships with industry leaders to advance its AirJoule® technology. These collaborations are critical in penetrating the HVAC and atmospheric water harvesting markets, which are substantial and growing due to increasing demand for energy-efficient and sustainable solutions.
The joint venture with GE Vernova aims to integrate advanced sorbent materials into AirJoule® systems, potentially enhancing the performance and market appeal of these products. This integration could provide a competitive edge by offering improved energy efficiency and water harvesting capabilities.
Additionally, Carrier's exclusive right to commercialize the technology in key regions, coupled with a non-exclusive right in others, ensures that Montana Technologies leverages Carrier's extensive distribution network and market reach. This strategy maximizes market penetration while mitigating some risks inherent in entering new markets.
However, the success of these partnerships depends on the timely achievement of commercialization milestones and the effective marketing of AirJoule® products in a highly competitive landscape.
Montana Technologies' AirJoule® technology is at the heart of its business strategy and its potential disruptive impact on the HVAC and water harvesting industries is noteworthy. The use of advanced sorbents and a self-regenerating pressure swing adsorption system are innovative approaches that could significantly enhance energy efficiency and water extraction from the atmosphere.
GE Vernova's involvement, particularly with its expertise in advanced materials, suggests that the technological foundation of AirJoule® will be robust and capable of addressing modern energy and water scarcity challenges. The collaboration aims to push the boundaries of HVAC technology by creating highly efficient systems that reduce energy consumption and carbon emissions.
For investors, the technological innovation here signals a potential for high returns, provided that Montana Technologies can successfully navigate the R&D challenges and bring competitive products to market.
Still, it's important to watch for any technological hurdles or delays in product development that could affect the company's growth trajectory.
Key Highlights
- Closed business combination (the "Business Combination") with Montana Technologies LLC ("Legacy Montana") and renamed the combined company "Montana Technologies Corporation"
$50 million - Upon completion of the Business Combination, Montana Technologies' common stock and warrants began trading on the Nasdaq Capital Market under new ticker symbols "AIRJ" and "AIRJW," respectively
- Formed a joint venture with GE Vernova to advance and commercialize transformational air conditioning and atmospheric water harvesting products featuring AirJoule® technology
- The joint venture is led by Bryan Barton, formerly the Senior Director of Marketing, Ventures, and Incubation at GE Vernova
- Entered into joint commercialization agreement term sheets with Carrier to develop and commercialize the AirJoule® dehumidifying and cooling technology for heating, ventilation, and air conditioning ("HVAC") solutions in the
Americas ,Europe ,India , and theMiddle East - Ended the quarter with
$37 million
Executive Commentary
Matt Jore, Chief Executive Officer of Montana Technologies stated, "We are excited to have completed our Business Combination and for Montana Technologies to be listed on Nasdaq. This represents a critical milestone for the company and will enable us, along with our strategic partners, to focus on developing and deploying our atmospheric thermal energy and water harvesting systems worldwide as a response to climate change and water scarcity. In addition, the recently announced partnerships with GE Vernova and Carrier showcase how our proprietary AirJoule® technology has been embraced by industry leaders; these partnerships will open our company and technology into two enormous target markets, HVAC and atmospheric water harvesting. We believe these actions place the company on a path to create a more equitable and sustainable future by fundamentally changing how we optimize increasingly scarce energy and water resources to create a better quality of life for all."
Pat Eilers, Executive Chairman, stated, "Montana Technologies met the core criteria of a clean tech solutions provider we were searching for when we started the process with Power & Digital Infrastructure Acquisition II Corp. Montana Technologies, through its proprietary AirJoule® units, has created a transformational technology that provides significant energy efficiency gains in HVAC and atmospheric water harvesting applications, and it addresses two of the world's most problematic issues, energy efficiency and water scarcity. We are thrilled to have completed this transaction, and I am excited to take on the role of Executive Chairman. I look forward to partnering with our newly announced management team to deliver value in the public markets."
Commercialization Agreement with Carrier
On January 8, 2024, Legacy Montana and Carrier, a global leader in intelligent climate and energy solutions, announced that they had entered into a binding term sheet related to a commercial collaboration to develop and commercialize the AirJoule® dehumidification and cooling technology. Subject to certain milestones, Legacy Montana granted Carrier the exclusive right to commercialize the AirJoule® technology into HVAC equipment in the
Carrier also committed
Joint Venture Agreement with GE Vernova
On January 29, 2024, Legacy Montana announced an agreement to form a joint venture with GE Vernova, a global leader in electrification, decarbonization, and energy solutions, to incorporate GE Vernova's proprietary sorbent materials into systems that utilize
The AirJoule® technology utilizes advanced sorbents and a self-regenerating pressure swing adsorption system to harvest thermal energy and pure water from air. GE Vernova, a recognized leader in the development of advanced materials technology for industrial systems, also seeks to deploy novel sorbent-based solutions that can enable a zero-carbon emissions future. Incorporating GE Vernova's sorbent innovations into AirJoule® technology will enhance the performance of the joint venture's energy-saving HVAC components as well as its atmospheric water harvesting products.
The joint venture closed on March 4, 2024. In addition, GE Vernova made an equity investment in Montana Technologies in conjunction with the Capital Raise. GE Vernova's Advanced Research team is providing support to the joint venture's R&D function, and Bryan Barton, formerly the Senior Director of Marketing, Ventures, and Incubation at GE Vernova, joined the joint venture full-time as its Chief Executive Officer. Dr. Barton is currently focused on expanding the joint venture team, advancing AirJoule® prototypes, and managing initial pilot projects with key potential customers for the HVAC components and atmospheric water harvesting products.
Completion of Business Combination
On March 14, 2024, Power & Digital Infrastructure Acquisition II Corp. ("XPDB") completed the Business Combination with Legacy Montana, which was originally announced on June 5, 2023. Upon completion of the Business Combination, the combined entity was renamed "Montana Technologies Corporation," and its common stock and warrants began trading on the Nasdaq Capital Market under new ticker symbols "AIRJ" and "AIRJW", respectively.
In conjunction with the Business Combination, the Capital Raise, led by investments from Carrier, the Rice Investment Group, and GE Vernova, and, together with amounts from XPDB's trust account, exceeded the
Recent Additions to the Board of Directors and Management Team
As part of the XPDB shareholder approval of the Business Combination, XPDB shareholders elected the following individuals as directors of Montana Technologies:
- Pat Eilers, Founder and Managing Partner of Transition Equity Partners;
- Max Baucus, Former Ambassador to
China and Six-Term United States Senator from theState of Montana ; - Paul Dabbar, Former Undersecretary of the Department of Energy for Science and current Chief Executive Officer and Co-Founder of Bohr Quantum Technology;
- Matt Jore, Chief Executive Officer of Montana Technologies;
- Stu Porter, Founder, Chief Executive Officer and Chief Investment Officer of Denham Capital; and
- Marwa Zaatari, Founder and Chief Scientist of D-Zine Partners
Subsequent to the completion of the Business Combination, the following individuals were appointed as directors of Montana Technologies:
- Ajay Agrawal, Senior Vice President, Global Services, Business Development and Chief Strategy Officer at Carrier Global Corporation; and
- Kyle Derham, Partner at Rice Investment Group
On May 7, 2024, Montana Technologies named Pat Eilers as Executive Chairman and appointed the following executives to its management team:
- Stephen Pang, Chief Financial Officer;
- Chad MacDonald, Chief Legal Officer; and
- Tom Divine, Vice President, Investor Relations and Finance
Quarterly Report on Form 10-Q
Montana Technologies' financial statements and related footnotes will be available in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, which is expected to be filed with the Securities and Exchange Commission on May 20, 2024.
Investor Update Webcast
Montana Technologies has provided investors with an earnings call webcast. Interested parties may view the webcast by visiting the investor section of Montana Technologies' website at www.mt.energy and clicking on the webcast link.
About Montana Technologies Corporation
Montana Technologies Corporation is a publicly traded company that holds the intellectual properties that make up the AirJoule® system, an atmospheric thermal energy and water harvesting technology that provides efficient and sustainable air conditioning and pure water from air. For more information, visit www.mt.energy.
Forward Looking Statements
The information in this press release includes "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. All statements, other than statements of present or historical fact included in this press release, regarding Montana Technologies and its future financial and operational performance, as well as its strategy, future operations, estimated financial position, estimated revenues, and losses, projected costs, prospects, plans and objectives of management are forward looking statements. When used in this press release, including any oral statements made in connection therewith, the words "could," "may," "will," "should," "anticipate," "believe," "intend," "estimate," "expect," "project," 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 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, Montana Technologies expressly disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements herein, to reflect events or circumstances after the date of this press release.
Montana Technologies 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 Montana Technology's control. These risks include, but are not limited to, our status as an early stage Company with limited operating history, which may make it difficult to evaluate the prospects for our future viability; our initial dependence on revenue generated from a single product; significant barriers we face to deploy our technology; the dependence of our commercialization strategy on our relationships with BASF, CATL, Carrier, GE Vernova, and other third parties history of losses, and the other risks and uncertainties described under the heading "Risk Factors" in our SEC filings including in our Registration Statement (See Risk Factors) on Form S-1 filed with the Securities and Exchange Commission (the "SEC") on April 11, 2024. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Should one or more of the risks or uncertainties described in this press release occur, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Montana Technology's SEC Filings are available publicly on the SEC's website at www.sec.gov, and readers are urged to carefully review and consider the various disclosures made in such filings.
MONTANA TECHNOLOGIES CORPORATION | ||||||||
March 31, | December 31, | |||||||
2024 | 2023 | |||||||
Assets | ||||||||
Current assets | ||||||||
Cash | $ | 37,429,270 | $ | 375,796 | ||||
Prepaid expenses and other assets | 486,338 | 126,971 | ||||||
Total current assets | 37,915,608 | 502,767 | ||||||
Operating lease right-of-use asset | 170,117 | 49,536 | ||||||
Property and equipment, net | 4,137 | 3,832 | ||||||
In-process research and development | 365,300,000 | — | ||||||
Goodwill | 247,233,000 | — | ||||||
Total assets | $ | 650,622,862 | $ | 556,135 | ||||
Liabilities and Stockholders' equity (deficit) | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 431,774 | $ | 2,518,763 | ||||
Accrued transaction fees | 3,077,107 | 3,644,100 | ||||||
Other accrued expenses | 6,781,239 | 244,440 | ||||||
Due to related parties | 1,440,000 | — | ||||||
Operating lease liability, current | 22,981 | 22,237 | ||||||
Total current liabilities | 11,753,101 | 6,429,540 | ||||||
Earnout Shares liability | 61,393,000 | — | ||||||
True Up Shares liability | 286,000 | — | ||||||
Subject Vesting Shares liability | 14,217,000 | — | ||||||
Operating lease liability, non-current | 147,858 | 27,299 | ||||||
Total liabilities | $ | 87,796,959 | $ | 6,456,839 | ||||
Commitments and contingencies (Note 12) | ||||||||
Stockholders' equity (deficit) | ||||||||
Preferred stock, | $ | — | $ | — | ||||
Class A Common stock, | 4,907 | 3,274 | ||||||
Class B Common stock, | 476 | 476 | ||||||
Subscription receivable | (6,000,000) | — | ||||||
Additional paid-in capital | — | 11,263,647 | ||||||
Accumulated deficit | (43,686,098) | (17,168,101) | ||||||
Total Montana Technologies Corporation stockholders' equity (deficit) | 49,680,715 | (5,900,704) | ||||||
Non-controlling interests | 612,506,618 | — | ||||||
Total stockholders' equity (deficit) | 562,825,903 | (5,900,704) | ||||||
Total liabilities and stockholders' equity (deficit) | $ | 650,622,862 | $ | 556,135 | ||||
MONTANA TECHNOLOGIES CORPORATION | ||||||||
Three Months Ended | ||||||||
2024 | 2023 | |||||||
Costs and expenses: | ||||||||
General and administrative | $ | 827,576 | $ | 218,175 | ||||
Research and development | 896,613 | 604,944 | ||||||
Sales and marketing | 37,725 | 10,423 | ||||||
Depreciation and amortization | 1,145 | 1,085 | ||||||
Loss from operations | (1,763,059) | (834,627) | ||||||
Other expenses, net: | ||||||||
Interest income | 38,236 | — | ||||||
Change in fair value of Earnout Shares liability | (7,672,000) | — | ||||||
Change in fair value of True Up Shares liability | 269,000 | |||||||
Change in fair value of Subject Vesting Shares | (2,425,000) | — | ||||||
Total other expenses, net | (9,789,764) | — | ||||||
Loss before income taxes | (11,552,823) | (834,627) | ||||||
Income tax expense | — | — | ||||||
Net loss | $ | (11,552,823) | $ | (834,627) | ||||
Net loss attributable to non-controlling interests | (26,382) | — | ||||||
Net loss attributable to common stockholders of the Company | $ | (11,526,441) | $ | (834,627) | ||||
Weighted average Class A common stock outstanding, basic and diluted | 36,916,955 | 32,599,213 | ||||||
Basic and diluted net loss attributable to common stockholders, Class A common stock | $ | (0.28) | $ | (0.02) | ||||
Weighted average Class B common stock outstanding, basic and diluted | 4,759,642 | 4,759,642 | ||||||
Basic and diluted net loss attributable to common stockholders, Class B common stock | $ | (0.28) | $ | (0.02) | ||||
MONTANA TECHNOLOGIES CORPORATION | ||||||||
For the Three Months Ended March 31, | ||||||||
2024 | 2023 | |||||||
Cash Flows from Operating Activities | ||||||||
Net loss | $ | (11,552,823) | $ | (834,627) | ||||
Adjustment to reconcile net loss to cash used in operating activities | ||||||||
Depreciation and amortization | 1,145 | 1,085 | ||||||
Amortization of operating lease right-of-use assets | 52,068 | 5,211 | ||||||
Change in fair value of Earnout Shares liability | 7,672,000 | — | ||||||
Change in fair value of True Up Shares liability | (269,000) | — | ||||||
Change in fair value of Subject Vesting Shares liability | 2,425,000 | — | ||||||
Changes in operating assets and liabilities: | ||||||||
Prepaid Expenses and Other Assets | 15,010 | 12,576 | ||||||
Operating lease liabilities | (51,346) | (5,211) | ||||||
Accounts payable | (2,674,319) | 40,279 | ||||||
Accrued expenses, accrued transaction costs and other liabilities | (1,057,718) | (22,948) | ||||||
Net cash used in operating activities | (5,439,983) | (803,635) | ||||||
Cash flows from Investing Activities | ||||||||
Purchases of fixed assets | (1,450) | — | ||||||
Net cash used in investing activities | (1,450) | — | ||||||
Cash flows from Financing Activities | ||||||||
Proceeds from the exercise of warrants | 45,760 | — | ||||||
Proceeds from the exercise of options | 56,250 | — | ||||||
Proceeds from the issuance of common stock | 43,365,000 | 255,861 | ||||||
Transaction costs - recapitalization | (972,103) | — | ||||||
Net cash provided by financing activities | 42,494,907 | 255,861 | ||||||
Net increase (decrease) in cash | 37,053,474 | (547,774) | ||||||
Cash, beginning of period | 375,796 | 5,211,486 | ||||||
Cash, end of the period | $ | 37,429,270 | 4,663,712 | |||||
Non-Cash investing and financing activities: | ||||||||
Initial recognition of earnout shares liability | $ | 53,721,000 | $ | — | ||||
Initial recognition of True Up Shares liability | 555,000 | — | ||||||
Initial recognition of Subject Vesting Shares liability | 11,792,000 | — | ||||||
Initial recognition of ROU asset and operating lease liability | 172,649 | — | ||||||
Liabilities combined in recapitalization, net | 8,680,477 | — | ||||||
Acquisition of business from GE Vernova in exchange for issuing non-controlling interests | 612,533,000 | — | ||||||
Supplemental Cash flow information: | ||||||||
Taxes paid | — | — | ||||||
Contacts
Investor Relations
Tom Divine – Vice President, Investor Relations and Finance
investors@mt.energy
Media:
Kekst CNC
MTMediaInquiries@kekstcnc.com
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SOURCE Montana Technologies
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