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Origin Materials Announces Organizational Streamlining to Further Support Caps and Closures Business

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Origin Materials (NASDAQ: ORGN, ORGNW) announced an organizational realignment to focus on its caps and closures business and reduce overall cash burn. Key points include:

1. Reallocation of resources to meet increasing demand for PET caps, potentially exceeding planned manufacturing capacity for 2025 and 2026.

2. Origin 1 plant in Sarnia, Ontario, to operate 'on demand' with reduced staffing.

3. Workforce reduction of approximately 28%, resulting in restructuring charges of about $0.6 million.

4. Maintained 2024 financial guidance: Revenue of $25-35 million and net cash burn between $55-65 million.

5. First commercial-scale PET cap production system on track to start later this year, with revenue ramp-up beginning in Q1 2025.

Origin Materials (NASDAQ: ORGN, ORGNW) ha annunciato un riallineamento organizzativo per concentrarsi sul suo business di tappi e chiusure e ridurre il dispendio di liquidità complessivo. I punti chiave includono:

1. Riassegnazione delle risorse per soddisfare la crescente domanda di tappi in PET, che potrebbe superare la capacità di produzione pianificata per il 2025 e il 2026.

2. Impianto Origin 1 a Sarnia, Ontario, opererà 'su richiesta' con dotazione di personale ridotta.

3. Riduzione della forza lavoro di circa il 28%, comportando costi di ristrutturazione di circa $0,6 milioni.

4. Conferma delle stime finanziarie per il 2024: Ricavi compresi tra $25-35 milioni e dispendio di liquidità netto tra $55-65 milioni.

5. Prima produzione di tappi in PET su scala commerciale programmata per iniziare entro la fine dell'anno, con un incremento dei ricavi previsto a partire dal primo trimestre del 2025.

Origin Materials (NASDAQ: ORGN, ORGNW) anunció un reajuste organizativo para centrarse en su negocio de tapones y cierres y reducir el consumo de efectivo general. Los puntos clave incluyen:

1. Reasignación de recursos para satisfacer la creciente demanda de tapones de PET, que podría superar la capacidad de fabricación planificada para 2025 y 2026.

2. Planta Origin 1 en Sarnia, Ontario, funcionará 'bajo demanda' con un personal reducido.

3. Reducción de la fuerza laboral de aproximadamente un 28%, lo que resultará en cargos de reestructuración de alrededor de $0.6 millones.

4. Mantenimiento de las guías financieras para 2024: Ingresos de $25-35 millones y quema de efectivo neta entre $55-65 millones.

5. Primer sistema de producción de tapones de PET a escala comercial en camino de comenzar a finales de este año, con un aumento de ingresos previsto para el primer trimestre de 2025.

Origin Materials (NASDAQ: ORGN, ORGNW)는 캡 및 밀폐 산업에 집중하고 전반적인 자금 소모를 줄이기 위해 조직 재편을 발표했습니다. 주요 사항은 다음과 같습니다:

1. 자원 재배치로 증가하는 PET 캡 수요를 충족하여 2025년과 2026년을 위한 계획된 생산 능력을 초과할 가능성이 있습니다.

2. 오리진 1 공장이 온타리오주 사르니아에서 '주문 시' 운영되며 인력이 줄어듭니다.

3. 인력 감소가 약 28% 이루어져 약 60만 달러의 구조 조정 비용이 발생합니다.

4. 2024년 재무 지침 유지: 수익은 2500만~3500만 달러, 순 현금 소모는 5500만~6500만 달러 사이입니다.

5. 상업 규모의 PET 캡 생산 시스템이 올해 말에 가동될 예정이며, 2025년 1분기부터 수익 증가가 시작됩니다.

Origin Materials (NASDAQ: ORGN, ORGNW) a annoncé un réajustement organisationnel afin de se concentrer sur son activité de bouchons et de fermetures, et de réduire la consommation de liquidités globale. Les points clés incluent :

1. Réallocation des ressources pour répondre à une demande croissante de bouchons en PET, qui pourrait dépasser la capacité de production prévue pour 2025 et 2026.

2. L'usine Origin 1 à Sarnia, Ontario, fonctionnera 'à la demande' avec un personnel réduit.

3. Réduction des effectifs d'environ 28 %, entraînant des charges de restructuration d'environ 0,6 million de dollars.

4. Maintien des prévisions financières pour 2024 : Chiffre d'affaires de 25 à 35 millions de dollars et consommation nette de liquidités entre 55 et 65 millions de dollars.

5. Premier système de production de bouchons en PET à l'échelle commerciale sur le point de commencer plus tard cette année, avec un pic de chiffre d'affaires attendu au premier trimestre 2025.

Origin Materials (NASDAQ: ORGN, ORGNW) hat eine organisatorische Neuordnung angekündigt, um sich auf sein Geschäft mit Kappen und Verschlüssen zu konzentrieren und den allgemeinen Geldverbrauch zu reduzieren. Die wichtigsten Punkte umfassen:

1. Neuzuweisung von Ressourcen, um der steigenden Nachfrage nach PET-Kappen gerecht zu werden, die möglicherweise die geplante Produktionskapazität für 2025 und 2026 übersteigen wird.

2. Das Origin 1-Werk in Sarnia, Ontario, wird 'auf Abruf' mit reduziertem Personal betrieben.

3. Reduzierung der Belegschaft um etwa 28%, was zu Restrukturierungskosten von etwa 0,6 Millionen USD führen wird.

4. Beibehaltung der finanziellen Prognose für 2024: Einnahmen von 25-35 Millionen USD und Nettobarmittelverbrauch zwischen 55-65 Millionen USD.

5. Erstes kommerzielles PET-Kappenproduktions system ist auf Kurs, um später in diesem Jahr zu starten, mit einer Umsatzsteigerung, die im ersten Quartal 2025 beginnt.

Positive
  • Reallocation of resources to meet increasing demand for PET caps
  • First caps customer signed MOU for billions of caps, totaling over $100 million over initial two-year term
  • Maintained 2024 financial guidance with revenue of $25-35 million
  • First commercial-scale PET cap production system on track to start later this year
  • Potential to exceed planned manufacturing capacity for 2025 and 2026
Negative
  • Workforce reduction of approximately 28%
  • Restructuring charges of about $0.6 million
  • Reduced operations at Origin 1 plant in Sarnia, Ontario
  • Net cash burn between $55-65 million for 2024

— Origin is Reallocating Resources to Caps and Closures and Reducing Overall Cash Burn to Accelerate Timeline to Profitability —

— Origin 1 to Operate “On Demand” for Customer Sample Production —

— Maintains 2024 Financial Guidance, Timeline for PET Cap Commercial Production and Revenue —

WEST SACRAMENTO, Calif.--(BUSINESS WIRE)-- Origin Materials (“Origin”) (NASDAQ: ORGN, ORGNW), a technology company with a mission to enable the world’s transition to sustainable materials, today announced an organizational realignment that reflects the reallocation of resources to its caps and closures business and reduces overall cash burn to accelerate Origin’s timeline to profitability.

“As near-term demand for Origin’s PET caps continues to increase, potentially exceeding our currently planned manufacturing capacity for 2025 and 2026, we are proactively reallocating resources to our caps and closures business,” said John Bissell, Co-Founder and Co-CEO of Origin Materials. “Our first caps customer has signed an MOU for billions of caps, totaling over $100 million over an initial two-year term. Today, we are positioned to bring the world's first PET cap solution to a $65 billion market with attractive margins.”

Bissell added: “Consistent with this reallocation of resources, we have made the decision to operate Origin 1, our biomass conversion plant in Sarnia, Ontario, ‘on demand’ with reduced staffing, while preserving our ability to generate product at small volumes sufficient to explore scale-up with strategic partners. The product already generated at Origin 1 over multiple campaigns, as well as materials Origin may purchase from third-party suppliers, can enable us to advance scale-up while allowing us to reduce our current overall cash burn. This decision, plus the reduction of certain expenses related to longer-term R&D projects, has necessitated a reorganization of our leadership team, as well as the difficult decision to part ways with many talented team members, to whom we are deeply appreciative, and who we will do our best to support in their future endeavors. As we establish a strong economic foundation through our PET caps and closures business, we expect to be ideally situated to drive deals regarding Origin’s biomass technology and furanics platform.”

Origin expects the workforce changes to be largely completed by the end of this quarter. The Company anticipates that it will incur approximately $0.6 million in restructuring charges in connection with the roughly 28% workforce reduction, consisting of cash expenditures of approximately $0.5 million and non-cash expenses of approximately $0.1 million.

Origin is maintaining its financial guidance for 2024 revenue and net cash burn, with revenue of $25 million to $35 million and net cash burn between $55 million and $65 million. In addition, Origin’s first commercial-scale PET cap mass production system is on track to start producing PET caps later this year, with caps revenue ramp-up to begin in the first quarter of 2025.

Origin Materials Co-CEO Rich Riley added: “Today we foresee rapid near-term growth in the caps and closures market, where we offer a powerful solution for product performance and recycling circularity. At the same time, we remain confident in the long-term potential for building additional businesses based on Origin’s biomass conversion technology – all in support of maximizing value for our shareholders and our mission to enable the world’s transition to sustainable materials.”

About Origin Materials
Origin is a technology company with a mission to enable the world’s transition to sustainable materials. Our innovations include PET caps and closures that bring recycling circularity and enhanced performance to a ~$65 billion market, specialty materials, and our patented biomass conversion platform that transforms carbon into sustainable materials for a wide range of end products. For more information, visit https://www.originmaterials.com/.

Cautionary Note on Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the federal securities laws. These statements are based on our estimates and assumptions as of the date of this press release and are subject to risks and uncertainties. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” “guidance,” “maintain,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding demand for, margins from, and profitability of the Company’s PET caps, timing to start producing PET caps and ramp-up revenue, the estimate and timing of charges incurred in connection with the realignment, potential benefits of deferring non-PET cap research programs and on-demand operation of Origin 1, financial guidance for 2024 revenue and net cash burn, speed and sustainability of growth in the caps and closures market, performance and recycling benefits of the Company’s PET caps, and potential additional business based on the Company’s biomass conversion technology and furanics platform. These forward-looking statements are subject to a number of risks and uncertainties including, but not limited to, the fact that Origin Materials may be unable to successfully commercialize its products; the effects of competition on Origin Materials’ business; the uncertainty of the projected financial information with respect to Origin; disruptions and other impacts to Origin’s business. Other factors that could adversely affect the transactions described above and the Company’s operations include those discussed in the Company’s Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission (SEC) on August 14, 2024 under the heading “Risk Factors,” and other documents Origin has filed, or will file, with the SEC. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Origin Materials presently does not know, or that Origin currently believes are immaterial, that could also cause actual results to differ from those contained in the forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law.

Origin Materials

Investors: ir@originmaterials.com

Media: media@originmaterials.com

Source: Origin Materials

FAQ

What is Origin Materials' (ORGN) new organizational strategy?

Origin Materials is reallocating resources to its caps and closures business and reducing overall cash burn to accelerate its timeline to profitability. This includes operating the Origin 1 plant 'on demand' and reducing workforce by approximately 28%.

How much revenue does Origin Materials (ORGN) expect in 2024?

Origin Materials maintains its 2024 financial guidance, expecting revenue between $25 million to $35 million.

When will Origin Materials (ORGN) start commercial production of PET caps?

Origin Materials' first commercial-scale PET cap mass production system is on track to start producing PET caps later in 2024, with caps revenue ramp-up beginning in the first quarter of 2025.

What is the value of the MOU signed by Origin Materials (ORGN) for PET caps?

Origin Materials' first caps customer has signed an MOU for billions of caps, totaling over $100 million over an initial two-year term.

Origin Materials, Inc.

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