May 25, 2022 (Financial News Media via COMTEX) -- FN Media Group Presents Microsmallcap.com Market Commentary
New York, NY - May 25, 2022 – Gas prices continue to test record highs, surpassing $4 per gallon in the US and $2 per liter across Canada for the first time, which is fueling rampant demand for electric vehicles across North America. For perspective, sales of plug-in electric vehicles in the US increased nearly 60% year-over-year in the first quarter of 2022, compared to the broader automotive market which slowed down by approximately 18% year-over-year due to supply chain constraints. It is highly likely that the passenger vehicle market will shift almost entirely to electric vehicles over the next few decades as carmakers set lofty EV goals, providing considerable room for growth for companies like Nano One Materials Corp. /zigman2/quotes/204489325/delayed CA:NANO +0.29% (otcpk:NNOMF), Lightning eMotors Inc. /zigman2/quotes/218421281/composite ZEV -2.14% , Nio Inc. /zigman2/quotes/204905836/composite NIO +1.39% , Lucid Group Inc /zigman2/quotes/221104327/composite LCID +3.15% , and Tesla Inc. /zigman2/quotes/203558040/composite TSLA +4.68% .
Nano One Materials Corp. /zigman2/quotes/204489325/delayed CA:NANO +0.29% /zigman2/quotes/208583595/composite NNOMF -1.10% is a technology company with a patented and scalable industrial process to produce low-cost, high-performance cathode powders used in lithium-ion batteries. These unique materials make up approximately half of a battery cell cost and add value to electric vehicles and grid storage batteries as part of the global push towards a zero-emission future.
On May 5, Nano One provided an update on its commercialization strategy, expansion plans, and partnerships. Nano One has technology scaling plans of 100 tons per year to support commercial qualification, detailed engineering and commercial plant design.
To support expansion towards commercialization, Nano One has incorporated a subsidiary in the province of Quebec, under the name Nano One Materials Quebec Inc. (Materiaux Nano One Quebec Inc.), to take advantage of the province’s skilled and experienced workforce, raw materials, low-cost hydroelectric power and its growing ecosystem of "mines-to-mobility" that has been in the making for decades.
Partnerships and pipeline growth in cathode chemistries continues. Nano One recently received patents number 21 and 22 adding to a strong portfolio of intellectual property, and 47 additional patent applications are pending.
"The global lithium ion battery materials market is ramping to millions and tens of millions of tonnes to meet terawatt-hours of forecasted energy storage, however, there are inefficiencies and by-products in the existing supply chain that do not readily scale. We cannot landfill billions of kilograms, we cannot generate more waste than we recycle and we cannot be burning through precious energy sources with inefficient processes," said Nano One CEO Dan Blondal. "Nano One's technologies are unique in addressing these costly and wasteful shortcomings in the battery supply chain and we intend to drive change in cathode materials manufacturing for a cleaner and more efficient future."
Nano One has a healthy treasury of US$48.6 million to execute business strategy.
On May 25th, the tech company announced the acquisition of Johnson Matthey Battery Materials Ltd. a Canadian entity located in Candiac, Quebec, for approximately C$10.25 million. JMBM Canada team has over 360 years of scaling and commercial production know-how for supplying automotive tier 1 lithium-ion cell manufacturers. This acquisition should help expedite Nano One's commercialization strategy.
"The rapidly expanding need for responsibly produced cathode materials in North America presents an opportunity for Nano One to deploy its technology and become a leader. We are excited to announce our agreement to acquire JMBM Canada. Experienced employees are at the core of this deal and will help fast-track Nano One's learning curve," said Nano One CEO Dan Blondal. "The facility is in Greater Montreal and strategically located in proximity to employees and their families, international airports, major port facilities and is a critical link in the mines-to-mobility initiative. This complements Nano One's technology innovation center and team in Burnaby, British Columbia, and is a perfect base for the advancement, expansion and acceleration of our commercialization strategy. We now look forward to working with our colleagues at JMBM Canada for a smooth business transition later this year and sharing our vision and plans with all stakeholders in the coming weeks and months."
The transaction is expected to close by the end of 2022.
EV Companies Are Selling More Vehicles
Lightning eMotors Inc. /zigman2/quotes/218421281/composite ZEV -2.14% reported first-quarter results on May 13. Revenue came in at $5.4 million, an increase of 18% from $4.6 million for Q1 2021. Net loss was $10.8 million ($0.14 per share), compared to a net loss of $27.4 million ($0.83 per share) in the prior-year quarter. Adjusted net loss was $18.7 million compared to $6.8 million a year ago. Lightning sold a record 68 units in the quarter. The company expects the Federal Infrastructure Bill 2021, which provides more than $10 billion in new funding for medium and heavy commercial electric vehicles, to begin disbursing in the fourth quarter of this year, driving demand for Lightning products and services both in the near and long term. A new electrified Class 5-6 van chassis and partnership with Blue Bird Corporation was revealed at the Advanced Clean Transportation Expo on May 10.
In the first quarter of 2022, Tesla Inc. /zigman2/quotes/203558040/composite TSLA +4.68% total revenue increased 81% year-over-year to $18.8 billion. Operating income improved to $3.6 billion, which translated into an operating margin of 19.2%. Cash, cash equivalents and short-term marketable securities at the end of the quarter increased sequentially by $0.3 billion to $18.0B in Q1, driven primarily by free cash flow of $2.2B, partially offset by debt repayments of $2.1B. Tesla's total debt excluding vehicle and energy products financing fell to less than $0.1 billion at the end of the first quarter. The company said that the rising prices of raw materials had an impact on its cost structure contributing to adjustments in the pricing of its products, despite a continued focus on reducing its manufacturing costs wherever possible.