EX-99.1 2 scwo_ex991.htm PRESS RELEASE scwo_ex991.htm

EXHIBIT 99.1 

 

 

 

374Water Releases

First Quarter 2024 Results and

Provides Business Update

 

New CEO Chris Gannon unveils Product Development, Commercialization and Go-to-Market Objectives

 

DURHAM, NC, May 15, 2024 374Water Inc. (Nasdaq: SCWO), a global leader in cutting-edge, sustainable waste management technologies, today provides a business update and reports its financial results for the first quarter ended March 31, 2024.

 

“In just under a month, we have hit the ground running developing a strategic plan to unlock the value inherent in this enterprise.  I have immersed myself in our technology and our market opportunities to chart the best path forward in our product development, commercialization, and go-to-market approach,” said Chris Gannon, CEO of 374Water. “We have a massive opportunity in front of us to take advantage of regulatory tailwinds driving demand for technologies like our AirSCWO system. Over the ensuing months, we will provide more detail and clarity on our go forward strategy, with a focus on four key areas: (1) executing on our municipal biosolid/sludge and federal/DOD contractual obligations which is an important proof point; (2) expanding the application of our AirSCWO systems to industrial and other waste streams; (3) securing new  manufacturing and engineering facilities; and (4) expanding our compliment of talented engineers and field personnel, as well as our leadership team.”

 

Financial Highlights

 

 

·

For the three-month period ended March 31, 2024, the Company generated revenue of $315,000 which compares to $801,000 for the three months ending March 31, 2023, a 61% decrease.

 

Our revenue is primarily based on progress toward completion of our sold unit and also includes the sale of treatability services. Costs associated with our sold unit have started to decline as we reach the end of our fabrication and testing, which have had a direct correlation to the reduced revenue recognized this year. This has had a direct impact on our change in revenue year-over-year.

 

·

Total Operating Expenses for the quarter ended March 31, 2024, increased marginally to $1.9 million from $1.8 million in the prior year quarter driven primarily by an increase in R&D expense.
   

Capital Structure

 

·

As of March 31, 2024, the Company had working capital of $11.7 million. We are actively working on optimizing our operational efficiencies and exploring new market opportunities, all aimed at long-term value creation while remaining steadfast in our commitment to innovation and excellence. A primary financial goal for the Company is to extend its runway while scaling the business.
   
 
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Business Highlights

 

 

·

On April 23, 2024 the Company announced the appointment of Chris Gannon as its new President and Chief Executive Officer. Mr. Gannon brings deep executive leadership experience in multiple disciplines and industries, including environmental technology development, highly engineered product, advanced manufacturing, and global customer support and service with customers in the municipal, industrial, commercial, defense, and medical spaces.

 

·

In March 2024, the Company announced a new contract with the City of Orlando, highlighted by the deployment of an AirSCWO 6 service unit, which will be integrated into Orlando’s Iron Bridge Water Pollution Control Facility. This AirSCWO 6 unit is expected to deploy in 2024.

 

·

374Water continued its progress on an expected 2024 deployment to Orange County Sanitation District. The Company is underway with factory acceptance testing and once achieved, will begin mobilizing the unit to Orange County.

 

·

The Company continues to focus on executing demonstrations and securing demonstration partners within the municipal biosolids, federal and military PFAS, and industrial markets.

 

·

The Company is in active discussions with major TSDF operators to not only serve as technology development and commercialization partners, focused initially on PFAS intensive waste streams, but also serve as long-term waste destruction partners. The Company places a priority these partnerships as we continue to scale our commercial grade technology to meet growing demand for AirSCWO technology.

   

Earnings Conference Call

 

Management will hold a conference call at 10:00 am Pacific Time (1:00 pm Eastern Time) on Friday, May 17, 2024, to provide a more detailed business update and discussion of quarterly results.  Participants who wish to join the conference by telephone can access the call by dialing (Toll Free) 888-506-0062 or (International) 973-528-0011. Participants may join the live webcast by accessing it at the webcast registration link here: https://www.webcaster4.com/Webcast/Page/3040/50613.

 

A webcast replay will be available through May 31, 2024 on the Investors Section of the Company’s website at https://374water.com/investor-relations/.

 

For more on AirSCWO or about our team, visit 374Water.com or follow us on LinkedIn.

 

About 374Water

 

374Water Inc. (NASDAQ:SCWO) is a global cleantech company with innovative solutions to wastewater treatment and waste management issues. 374Water’s AirSCWO technology transforms organic “wastes” into minimal impact, value-added products, effectively shifting the waste management paradigm from disposal to resource recovery. 374Water is leading a new era of creating value in sustainability, eliminating PFAS and protecting our communities. Follow us on LinkedIn.

  

 
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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

 

 
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374Water Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

March 31, 2024 (Unaudited) and December 31, 2023

 

Assets

 

March 31,

2024

 

 

December 31,

2023

 

Current Assets:

 

 

 

 

 

 

Cash

 

$ 7,936,161

 

 

$ 10,445,404

 

Accounts receivable, net of allowance

 

 

84,324

 

 

 

64,792

 

Unbilled accounts receivable

 

 

1,771,609

 

 

 

1,494,553

 

Other accounts receivable

 

 

34,161

 

 

 

39,749

 

Inventory, net

 

 

2,601,658

 

 

 

2,276,677

 

Prepaid expenses

 

 

921,365

 

 

 

581,085

 

Total Current Assets

 

 

13,349,278

 

 

 

14,902,260

 

Long-Term Assets:

 

 

 

 

 

 

 

 

Property, and Equipment, net

 

 

223,339

 

 

 

230,971

 

Intangible asset, net

 

 

971,691

 

 

 

988,029

 

Total Long-Term Assets

 

 

1,195,030

 

 

 

1,219,000

 

Total Assets

 

$ 14,544,308

 

 

$ 16,121,260

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$ 755,721

 

 

$ 572,297

 

Accrued contract loss provision

 

 

600,000

 

 

 

500,000

 

Accrued legal settlement

 

 

135,000

 

 

 

135,000

 

Unearned revenue

 

 

132,768

 

 

 

130,000

 

Other liabilities

 

 

10,408

 

 

 

36,787

 

Total Current Liabilities

 

 

1,633,897

 

 

 

1,374,084

 

Total Liabilities

 

 

1,633,897

 

 

 

1,374,084

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

 

 

 

Preferred stock: 50,000,000 convertible Series D preferred shares authorized; par value $0.0001 per share, nil issued and

 

 

 

 

 

 

 

 

outstanding at March 31, 2024 and December 31, 2023

 

 

 

 

 

 

Common stock: 200,000,000 common shares authorized, par value $0.0001 per share, 132,670,446 and 132,667,107 shares

 

 

 

 

 

 

 

 

outstanding at March 31, 2024 and December 31, 2023, respectively

 

 

13,266

 

 

 

13,266

 

Additional paid-in capital

 

 

30,872,643

 

 

 

30,684,943

 

Accumulated deficit

 

 

(17,977,969 )

 

 

(15,953,504 )

Accumulated other comprehensive loss

 

 

2,471

 

 

 

2,471

 

Total Stockholders’ Equity

 

 

12,910,411

 

 

 

14,747,176

 

Total Liabilities and Stockholders’ Equity

 

$ 14,544,308

 

 

$ 16,121,260

 

 
 
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374Water,  Inc.   and   Subsidiaries

Condensed Consolidated Statements of Operations

For the three months ended March 31, 2024 and 2023 (Unaudited)

 

 

 

2024

 

 

2023

 

Revenue

 

$ 315,278

 

 

$ 801,458

 

Cost of goods sold

 

 

617,298

 

 

 

720,146

 

Gross margin

 

 

(302,020 )

 

 

81,312

 

Operating Expenses

 

 

 

 

 

 

 

 

Research and development

 

 

535,147

 

 

 

355,905

 

Compensation and related expenses

 

 

651,604

 

 

 

718,760

 

Professional fees

 

 

252,705

 

 

 

99,572

 

General and administrative

 

 

459,727

 

 

 

585,659

 

Total Operating Expenses

 

 

1,899,183

 

 

 

1,759,896

 

 

 

 

 

 

 

 

 

 

Loss from Operations

 

 

(2,201,203 )

 

 

(1,678,584 )

 

 

 

 

 

 

 

 

 

Other Income

 

 

 

 

 

 

 

 

Interest income

 

 

104,620

 

 

 

37,859

 

Other income

 

 

72,118

 

 

 

382

 

Total Other Income

 

 

176,738

 

 

 

38,241

 

Net Loss before Income Taxes

 

 

(2,024,465 )

 

 

(1,640,343 )

Provision for Income Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$ (2,024,465 )

 

$ (1,640,343 )

 

 

 

 

 

 

 

 

 

Other comprehensive income

 

 

 

 

 

 

 

 

Foreign currency translation gain

 

 

-

 

 

 

824

 

Unrealized gain on marketable securities

 

 

-

 

 

 

18,967

 

Total other comprehensive loss

 

 

-

 

 

 

19,791

 

Total comprehensive loss

 

 

(2,024,465 )

 

 

(1,620,552 )

Net Loss per Share - Basic and Diluted

 

$ (0.02 )

 

$ (0.01 )

 

 

 

 

 

 

 

 

 

Weighted Average Common Shares Outstanding - Basic and Diluted

 

 

132,668,777

 

 

 

127,146,695

 

 

 
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374Water Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows 

For the three months ended March 31, 2024 and 2023 (Unaudited) 

 

Cash Flows from Operating Activities

 

2024

 

 

2023

 

Net loss

 

$ (2,024,465 )

 

$ (1,640,343 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization expense

 

 

24,560

 

 

 

29,105

 

Issuance of common stock for services

 

 

4,500

 

 

 

-

 

Stock-based compensation

 

 

183,200

 

 

 

214,924

 

Gain on foreign currency translation

 

 

-

 

 

 

824

 

Increase in inventory reserve

 

 

50,000

 

 

 

-

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(19,532 )

 

 

(26,188 )

Unbilled accounts receivable

 

 

(277,056 )

 

 

(754,290 )

Other receivables

 

 

5,588

 

 

 

(308,374 )

Inventory

 

 

(374,981 )

 

 

(127,309 )

Prepaid expenses

 

 

(340,280 )

 

 

23,285

 

Accounts payable and accrued expenses

 

 

183,424

 

 

 

(581,582 )

Accrued contract loss provision

 

 

100,000

 

 

 

-

 

Unearned revenue

 

 

2,768

 

 

 

5,000

 

Other liabilities

 

 

(26,379 )

 

 

(13,528 )

Net Cash Used In Operating Activities

 

 

(2,508,653 )

 

 

(3,178,176 )

 

 

 

 

 

 

 

 

 

Cash Flows from Investing Activities

 

 

 

 

 

 

 

 

Purchase of equipment

 

 

-

 

 

 

(7,303 )

Increase in intangible assets

 

 

(590 )

 

 

(2,705 )

 

 

 

 

 

 

 

 

 

Cash Used In Investing Activities

 

 

(590 )

 

 

(10,008 )

 

 

 

 

 

 

 

 

 

Cash Flowfrom Financing Activities

 

 

 

 

 

 

 

 

Proceeds from the sale of common stock

 

 

-

 

 

 

8,294,708

 

Cash Provided by Financing Activities

 

 

-

 

 

 

8,294,708

 

 

 

 

 

 

 

 

 

 

Net (Decrease) Increase in Cash

 

 

(2,509,243 )

 

 

5,106,224

 

Cash, Beginning of the Period

 

 

10,445,404

 

 

 

4,046,937

 

Cash, End of the Period

 

$ 7,936,161

 

 

$ 9,153,161

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL CASH FLOW DISCLOSURES:

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

 

 

$

 

Cash paid for taxes

 

$

 

 

$

 

 
 
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