• Total Revenue: $7.6 million in Q2 2024, down from $12.9 million in the prior year quarter.
• PHA-based Resin Sales: $5.9 million, a decrease of 30% or $2.5 million year-over-year.
• PLA-based Resin Sales: $1.4 million, a decrease of $2.4 million compared to the prior year.
• Gross Loss: $6.9 million in Q2 2024, compared to $6.6 million in the prior year quarter.
• Adjusted Gross Loss: $1.8 million, compared to $1.6 million in the prior year quarter.
• R&D and SG&A Expenses: $8.1 million, down from $8.6 million in the prior year quarter.
• Adjusted EBITDA Loss: $9.9 million, an improvement from a loss of $10.2 million in Q2 2023.
• Unrestricted Cash and Cash Equivalents: $40.3 million at the end of Q2 2024.
• Capital Expenditures: $1.8 million in Q2 2024, down from $6.6 million in the prior year quarter.
• Total Debt Balance: $394 million at the end of Q2 2024.
• Adjusted EBITDA Guidance for 2024: Expected to be in the range of minus $30 million to minus $35 million.
• End of Year Liquidity Guidance: Expected to be in the range of $15 million to $20 million.

• Warning! GuruFocus has detected 4 Warning Signs with DNMR.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Danimer Scientific Inc (NYSE:DNMR) is the only producer of PHA at commercial scale with independently validated biodegradable resins.
• The company has conducted commercial trials and research-based sampling with hundreds of potential customers, including Starbucks and WinCup.
• Danimer Scientific Inc (NYSE:DNMR) expects to achieve full capacity utilization of its Kentucky facility over the next several quarters.
• The company anticipates crossing over to positive EBITDA in the second quarter of 2025 and exiting 2025 at a run rate approaching $15 million of EBITDA annually.
• Danimer Scientific Inc (NYSE:DNMR) has implemented operational cost reductions resulting in approximately $7 million in annualized savings.

Negative Points

• Total revenue for the second quarter was $7.6 million, down from $12.9 million in the prior year quarter.
• PHA-based resin sales decreased by 30% or $2.5 million in the second quarter of 2024 compared to the prior year.
• The company reported a second quarter 2024 gross loss of $6.9 million, consistent with the prior year quarter's gross loss.
• Danimer Scientific Inc (NYSE:DNMR) expects a negative impact on adjusted EBITDA due to the Starbucks inventory adjustment.
• Liquidity remains a significant focus, with unrestricted cash and cash equivalents at $40.3 million at the end of the second quarter.

Q & A Highlights

Q: What are the sources of the reduced EBITDA guidance? Is it due to more inventory that needs to be burned off at the converters for Starbucks, or is it something else? A: The reduced EBITDA guidance is primarily due to the Starbucks inventory adjustment. Last quarter, we guided towards the lower end of our guidance, and the impact of that inventory issue has resulted in a lower-than-expected outcome. - Stephen Croskrey, CEO

Q: How much does halting the catalytic operations save annually, and can it be restarted easily? A: Halting the catalytic operations saves about $1.5 million annually. We are retaining enough key employees to restart operations if necessary, although we might not need to if commercial opportunities progress as expected. - Stephen Croskrey, CEO

Q: Can you discuss the tolling and licensing arrangements beyond Kentucky? A: We are exploring tolling and licensing arrangements to bridge any potential capacity gap between Kentucky reaching full capacity and the greenfield project coming online. We will update as progress is made. - Stephen Croskrey, CEO

Q: Is the exploration of tolling and licensing arrangements driven by customer demand? A: Yes, it is indirectly driven by customer demand due to the volume forecasts and market conditions. We anticipate a potential gap in capacity depending on the timing of the greenfield project. - Stephen Croskrey, CEO

Q: Can you provide an update on the timing of the DOE loan process? A: While I can't provide specific timing, both teams are focused on completing the process before the end of the year. - Stephen Croskrey, CEO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.