374Water Nearly Triples Q1 2023 Revenue while Building Pipeline of Prospects for Next Commercial Units
Company successfully demonstrated its technology to over 400 attendees
DURHAM, NC / ACCESSWIRE / May 9, 2023 / 374Water Inc. (NASDAQ:SCWO), a global social impact and cleantech company offering a revolutionary commercial waste management solution for the environment, today provides a business update and reports its financial results for the quarter ended March 31, 2023.
"This quarter was marked by progress in building our pipeline of prospective customers that witnessed our first commercial AirSCWO™ 6 system that was purchased by Orange County Sanitation District," said Kobe Nagar, 374Water Chairman and CEO. "The addressable market for our technology is significant and, looking ahead, our focus is on soundly scaling our business to meet demand in line with our commitment to create a world without waste through development of commercial solutions for environmental preservation."
"During the quarter, we saw an opportunity to utilize our at-the-market equity tool to raise capital to meet the growing market demand," said Israel Abitbol, 374Water Chief Financial Officer. "Our goal is to efficiently scale our business in line with the opportunity we see, while taking steps toward improved margins and profitability."
Financial Highlights
- Revenue for the quarter ended March 31, 2023 was
$801,000 , compared to$273,000 for the same period in 2022, an increase of193% .- 2023 revenue was due to manufacturing assembly services while 2022 revenue was primarily due to consulting and advisory services.
- At the same time, the Company managed its Cost of Goods Sold to generate a
222% increase in its Gross Profit compared to the period ended March 31, 2022. - Total Operating Expenses increased as the Company makes strides in building its pipeline while commercializing and improving its technology:
- Research and Development expenses increased from
$186,000 t o$356,000 , primarily a result of the increase in engineering costs related to commercializing our system. - Compensation-related expenses grew to
$719,000 from$301,000 primarily due to increased payroll and benefit expenses as a result of growing active projects. - General and administrative expenses increased to
$586,000 from$261,000 primarily as a result of increased insurance costs and public company expenses.
- Research and Development expenses increased from
Capital Structure
- As of March 31, 2023 we had working capital of
$13,966,018 compared to working capital of$7,060,511 at December 31, 2022. This increase in working capital is due primarily to share issuances under the Company's the-market common stock offering.
Operational Highlights
- The Company successfully demonstrated its AirSCWO™ supercritical water oxidation (SCWO) technology during SCWO week at its manufacturing partner's facility in Indiana. The event showcased the company's revolutionary waste management solution to hundreds of prospective customers, along with analysts and investors. The 3-day event, attended by over 400 guests featured a demonstration of the first commercial unit (Ana), set to be deployed in Orange County, CA, later this year. Attendees included over 200 potential customers, and several municipalities, representing over 10 countries.
- 374Water participated in the United Nations 2023 Water Conference and hosted an accredited side event. During the conference, the Company hosted its own "Future of PFAS, Waste and Clean Water" expert panel in the Nasdaq Boardroom.
For more on AirSCWO™ or about our team, visit 374Water.com or follow us on LinkedIn and Twitter.
About 374Water
374Water Inc. (Nasdaq:SCWO), is a global cleantech, social impact company whose mission is to preserve a clean and healthy environment that sustains life. We are pioneering a new era of sustainable waste management that supports a circular economy and enables organizations to achieve their environmental, social, and governance (ESG) and sustainability goals. Follow us on LinkedIn and Twitter.
Cautionary Language
This press release contains "forward-looking statements," as that term is defined under the Private Securities Litigation Reform Act of 1995 (PSLRA), which statements may be identified by words such as "expects," "plans," "projects," "will," "may," "anticipates," "believes," "should," "intends," "estimates," and other words of similar meaning.
Investor Contact:
Heather Crowell
ir@374water.com
Media Contact:
Christian Rizzo
media@374water.com
374Water Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
March 31, 2023 (Unaudited) and December 31, 2022
| 2023 | 2022 | |||||||
Assets | ||||||||
Current Assets: | ||||||||
Cash | $ | 9,153,161 | 4,046,937 | |||||
Accounts receivable, net of allowance of | 26,188 | - | ||||||
Unbilled accounts receivable | 1,672,454 | 918,164 | ||||||
Other accounts receivable | 308,374 | - | ||||||
Inventory | 1,788,019 | 1,660,710 | ||||||
Investments | 1,960,761 | 1,944,464 | ||||||
Prepaid expenses | 130,170 | 153,455 | ||||||
Total Current Assets | 15,039,127 | 8,723,730 | ||||||
Long-Term Assets: | ||||||||
Equipment, net | 140,857 | 143,079 | ||||||
Intangible asset, net | 1,035,817 | 1,050,022 | ||||||
Total Long-Term Assets | 1,176,674 | 1,193,101 | ||||||
Total Assets | $ | 16,215,801 | 9,916,831 | |||||
Liabilities and Stockholders` Equity | ||||||||
Current Liabilities: | ||||||||
Accounts payable and accrued expenses | $ | 868,000 | 1,449,582 | |||||
Deferred revenue | 205,109 | 200,109 | ||||||
Other liabilities | - | 13,528 | ||||||
Total Current Liabilities | 1,073,109 | 1,663,219 | ||||||
Total Liabilities | 1,073,109 | 1,663,219 | ||||||
Stockholders` Equity | ||||||||
Preferred stock: 50,000,000 convertible Series D preferred shares authorized; par value | - | - | ||||||
Common stock : 200,000,000 common shares authorized, par value | 12,883 | 12,669 | ||||||
Additional paid-in capital | 24,619,639 | 16,110,221 | ||||||
Accumulated (deficit) | (9,490,325 | ) | (7,849,982 | ) | ||||
Accumulated other comprehensive loss | 495 | (19,296 | ) | |||||
Total Stockholders` Equity | 15,142,692 | 8,253,612 | ||||||
Total Liabilities and Stockholders` Equity | $ | 16,215,801 | 9,916,831 | |||||
374Water, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
For the three months ended March 31, 2023 and 2022
(Unaudited)
| Three months ended March 31, | ||||||||
| 2023 | 2022 | |||||||
Revenue | $ | 801,458 | 273,231 | |||||
Cost of goods sold | 720,146 | 247,986 | ||||||
Gross profit | 81,312 | 25,245 | ||||||
Operating Expenses | ||||||||
Research and development | 355,905 | 185,653 | ||||||
Compensation and related expenses | 718,760 | 301,235 | ||||||
Professional fees | 99,572 | 150,658 | ||||||
General and administrative | 585,659 | 261,403 | ||||||
Total Operating Expenses | 1,759,896 | 898,950 | ||||||
Loss from Operations | (1,678,584 | ) | (873,705 | ) | ||||
Other Income (Expense) | ||||||||
Interest income | 37,859 | 840 | ||||||
Other income | 382 | 7 | ||||||
Total Other Income (Expense) | 38,241 | 847 | ||||||
Net Loss before Income Taxes | (1,640,343 | ) | (872,858 | ) | ||||
Provision for Income Taxes | - | - | ||||||
Net Loss | $ | (1,640,343 | ) | (872,858 | ) | |||
Other comprehensive loss | ||||||||
Change in foreign currency translation | 824 | - | ||||||
Change in unrealized loss on marketable securities | 18,967 | - | ||||||
Total other comprehensive loss | 19,791 | - | ||||||
Total comprehensive loss | (1,620,552 | ) | (872,858 | ) | ||||
Net Loss per Share - Basic and Diluted | $ | (0.01 | ) | (0.01 | ) | |||
Weighted Average Common Shares Outstanding - Basic and Diluted | 127,146,695 | 126,499,142 | ||||||
374Water Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the three months ended March 31, 2023 and 2022 (Unaudited)
| 2023 | 2022 | |||||||
Cash Flows from Operating Activities | ||||||||
Net loss | $ | (1,640,343 | ) | (872,858 | ) | |||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization expense | 29,105 | 16,458 | ||||||
Stock based compensation | 214,924 | 97,558 | ||||||
Change in foreign currency translation | 824 | - | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (26,188 | ) | - | |||||
Unbilled accounts receivable | (754,290 | ) | - | |||||
Other accounts receivable | (308,374 | ) | - | |||||
Inventory | (127,309 | ) | - | |||||
Prepaid expenses | 23,285 | (50,599 | ) | |||||
Accounts payable and accrued expenses | (581,582 | ) | 81,059 | |||||
Deferred revenue | 5,000 | 763,333 | ||||||
Other liabilities | (13,528 | ) | (20,238 | ) | ||||
Cash Provided by (Used In) Operating Activities | (3,178,476 | ) | 115,911 | |||||
Cash Flows from Investing Activities | ||||||||
Purchase of equipment | (7,303 | ) | (3,291 | ) | ||||
Increase in intangible assets | (2,705 | ) | - | |||||
Cash Provided by (Used In) Investing Activities | (10,008 | ) | (3,291 | ) | ||||
Cash Flow from Financing Activities | ||||||||
Proceeds from the issuance of common stock | 8,294,708 | - | ||||||
Cash Provided by Financing Activities | 8,294,708 | - | ||||||
Net Increase in Cash | 5,106,224 | 112,620 | ||||||
Cash, Beginning of the Period | 4,046,937 | 11,131,175 | ||||||
Cash, End of the Period | $ | 9,153,161 | 11,243,795 | |||||
NON-CASH FINANCING ACTIVITIES | ||||||||
Conversion of preferred stock to common stock | $ | - | 133 | |||||
SOURCE: 374Water Inc.
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