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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Trinity Merger Corporation | NASDAQ:TMCX | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 11.00 | 10.96 | 11.04 | 0 | 01:00:00 |
The Metals Company (Nasdaq: TMC) (“TMC” or “the Company”), an explorer of lower-impact battery metals from seafloor polymetallic nodules, today provided financial results for the third quarter ending September 30, 2021 and announced a corporate update.
Q3 2021 Financial Highlights
“At COP26, the world’s governments are committing to a rapid transformation of energy and transport. What’s catching people by surprise is that this transition starts and ends with metals,” said Gerard Barron, Chairman and CEO of The Metals Company. “To hit net-zero globally by 2050, would require six times more mineral inputs in 2040 than today. If you take nickel —essential for electric vehicle and storage batteries — nickel inputs would need to grow 19 times, with much of this growth set to come from beneath rainforests, our critical carbon sinks. With the capital that we’ve raised in the third quarter and with TMC now a public company, we can play a key role in making sure minerals are an enabler, not a bottleneck for the energy transition by supplying lower-carbon and lower-impact battery metals like nickel and copper from the planet’s largest estimated source.”
Q3 2021 Operational Highlights
Industry Update
Financial Results Overview
TMC reported a net loss for the third quarter of 2021 of $36.7 million, or $0.18 per share, compared to TMC’s net loss of $6.8 million, or $0.04 per share, for the third quarter of 2020. Exploration expenses during the third quarter of 2021 were $23.8 million compared to $4.6 million for the third quarter of 2020. General and administrative expenses were $13.3 million for the third quarter of 2021 compared to $2.2 million for the third quarter of 2020.
The increase in exploration expenses was mainly due to $12.9 million related to the first two milestone payments accrued to Allseas in 2021 under the amended PMTS agreement, $2.8 million higher cost of offshore campaigns in the 2021 period as compared to the 2020 period as a result of more campaigns undertaken in the third quarter 2021 compared to fewer campaigns in the prior year period, and $2.8 million higher stock-based compensation expense in the 2021 period as compared to the 2020 period due to the timing of recognition of expense for stock options granted in the first quarter of 2021.
The increase in general and administrative expenses were a result of increased stock-based compensation expense of $5.3 million as compared to the 2020 period due to amendments for certain stock option grants to extend their term beyond the retirement provisions, resulting in an expense of $3.9 million and timing of recognition of expense for stock options granted in the first quarter of 2021. In addition, we incurred an increase in professional fees in connection with the combination of DeepGreen Metals, Inc. and Sustainable Opportunities Acquisition Corp., and other costs associated with being a public company of $2.4 million. Overall, our business activities increased and we incurred additional marketing costs of $2.2 million and personnel and director fees of $0.7 million during the three months ended September 30, 2021 over those incurred in the same period of the prior year.
Restatement of Previously Issued Financial Statements
The results in this earnings release encompass the impacts of restatements of previously issued quarterly financial statements as of and for the three-month period ended March 31, 2021 and as of and for the six month period ended June 30, 2021. The restatements resulted from (a) certain invoices for exploration expenses not being appropriately accrued as of June 30, 2021 and (b) expensing of options granted in the first quarter of 2021 based on the grantee’s historical start date with the Company rather than the grant date of the options on March 4, 2021. A summary of the effect of the restatements on the previously issued financial statements is included at the end of this release.
Liquidity, Capital Allocation and Key Milestones
At September 30, 2021, TMC held cash and cash equivalents of $112.6 million and held no debt. This cash position is expected to enable TMC to achieve four key milestones by the end of the third quarter of 2023:
Conference Call
TMC will hold a conference call today at 4:30 p.m. ET to provide an update on recent corporate developments, third quarter financial results and upcoming milestones.
Date: Thursday, November 11, 2021 Time: 4:30 p.m. ET Virtual Webcast: Register Here Toll-free dial-in number: (844) 200-6205 International dial-in number: (929) 526-1599 Conference ID: 688797
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 1-949-574-3860.
The conference call will have virtual webcast and will be available for replay on the Company-Investors portion of TMC’s website under Media > Events and Presentations.
A replay of the conference call will also be available after 6:30 p.m. Eastern time on the same day through November 18, 2021, via the information below:
Toll-free replay number: (844) 200-6205 International replay number: (929) 526-1599 Replay ID: 146384
About The Metals Company
The Metals Company is an explorer of lower-impact battery metals from seafloor polymetallic nodules, on a dual mission: (1) supply metals for the clean energy transition with the least possible negative environmental and social impact and (2) accelerate the transition to a circular metal economy. The company through its subsidiaries holds exploration and commercial rights to three polymetallic nodule contract areas in the Clarion Clipperton Zone of the Pacific Ocean regulated by the International Seabed Authority and sponsored by the governments of Nauru, Kiribati and the Kingdom of Tonga.
More information is available at www.metals.co.
Forward Looking Statements
Certain statements made in this press release are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. 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” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. The forward-looking statements contained in this press release include, without limitation, statements regarding TMC’s expectations with respect to meeting key milestones and the timing thereof, development of its estimated resources of battery metals, the timing of its application to the ISA for an exploitation contract, potential regulatory approvals, the size and potential growth of current or future markets for TMC’s supply of battery metals, TMC’s expectations with respect to the results or outcomes of its campaigns and expeditions, the sufficiency of cash on hand to meet working capital and capital expenditure requirements and certain milestones, the timing, sources and amounts of future revenues and expenses and the restatement of TMC’s financial statements. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from those discussed in the forward-looking statements. Most of these factors are outside TMC’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: regulatory uncertainties and the impact of government regulation and political instability on TMC’s resource activities; changes to any of the laws, rules, regulations or policies to which TMC is subject; the impact of extensive and costly environmental requirements on TMC’s operations and the timing to completion of the Environmental Impact Assessment; environmental liabilities; the impact of polymetallic nodule collection on biodiversity in the CCZ and recovery rates of impacted ecosystems; TMC’s ability to develop minerals in sufficient grade or quantities to justify commercial operations; the lack of development of seafloor polymetallic nodule deposit; uncertainty in the estimates for mineral resource calculations from certain contract areas and for the grade and quality of polymetallic nodule deposits; risks associated with natural hazards; uncertainty with respect to the specialized treatment and processing of polymetallic nodules that TMC may recover; risks associated with collective, development and processing operations; fluctuations in transportation costs; testing and manufacturing of equipment; risks associated with TMC’s limited operating history; the impact of the COVID-19 pandemic; risks associated with TMC’s intellectual property; and other risks and uncertainties indicated from time to time in the prospectus, filed with the U.S. Securities and Exchange Commission (“SEC”) on October 22, 2021, including those under “Risk Factors” therein, and in TMC’s other future filings with the SEC. TMC cautions that the foregoing list of factors is not exclusive. TMC cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. TMC does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions, or circumstances on which any such statement is based except as required by law.
TMC the metals company Inc. Condensed Consolidated Balance Sheets (in thousands of US Dollars, except share amounts) (Unaudited)
As at September 30 2021
As at December 31 2020
ASSETS
Current
Cash and cash equivalents
112,640
10,096
Receivables and prepayments
139
129
112,779
10,225
Non-current
Exploration contracts
43,150
43,150
Equipment
1,387
1,310
44,537
44,460
TOTAL ASSETS
157,316
54,685
LIABILITIES
Current
Accounts payable and accrued liabilities
28,343
4,316
Deferred acquisition costs
-
3,440
28,343
7,756
Non-current
Deferred tax liability
10,675
10,675
Warrant liability
11,623
-
TOTAL LIABILITIES
50,641
18,431
EQUITY
Common shares (unlimited shares, no par value – issued: 224,385,324 (December 31, 2020 – 189,493,593))
284,228
154,431
Preferred shares (unlimited share, no par value – issued: nil (December 31, 2020 – 509,459))
-
550
Class A - J Special Shares
-
-
Additional paid in capital
108,022
45,347
Accumulated other comprehensive loss
(1,216
)
(1,216
)
Deficit
(284,359
)
(162,858
)
TOTAL EQUITY
106,675
36,254
TOTAL LIABILITIES AND EQUITY
157,316
54,685
TMC the metals company Inc. Condensed Consolidated Statements of Loss and Comprehensive Loss (in thousands of US Dollars, except share and per share amounts) (Unaudited)
Three months ended September 30,
Nine months ended September 30,
2021
2020
2021
2020
Operating expenses
Exploration expenses
23,848
4,556
80,181
35,744
General and administrative expenses
13,334
2,192
41,138
3,818
Operating loss
37,182
6,748
121,319
39,562
Other items
Change in fair value of warrant liability
(878
)
-
(878
)
-
Foreign exchange loss
5
41
57
37
Interest expense (income)
342
(3
)
1,003
(53
)
Loss and comprehensive loss for the period
36,651
6,786
121,501
39,546
Loss per share
- Basic and diluted
$
0.18
$
0.04
$
0.61
$
0.23
Weighted average number of common shares outstanding – basic and diluted
205,248,258
186,432,173
198,092,309
175,631,164
TMC the metals company Inc. Condensed Consolidated Statements of Cash Flows (in thousands of US Dollars) (Unaudited)
Nine months ended September 30,
2021
2020
Cash resources provided by (used in)
Operating activities
Loss for the period
(121,501
)
(39,546
)
Items not affecting cash:
Amortization
324
421
Expenses settled in share-based payments
69,357
16,653
Interest on convertible debentures
1,003
-
Change in fair value of warrant liability
(878
)
-
Unrealized foreign exchange
(31
)
(1
)
Changes in working capital:
Receivables and prepayments
(8
)
(65
)
Accounts payable and accrued liabilities
23,395
1,188
Net cash used in operating activities
(28,339
)
(21,350
)
Investing activities
Acquisition of exploration contract
(3,440
)
(607
)
Acquisition of equipment
(402
)
-
Net cash used in investing activities
(3,842
)
(607
)
Financing activities
Exercise of stock options
4,236
-
Proceeds from issuance of convertible debentures
26,000
-
Proceeds from issuance of common shares (net of fees and other costs)
-
20,348
Proceeds from Business Combination (net of fees and other costs)
104,465
-
Net cash provided by financing activities
134,701
20,348
Net change in cash and cash equivalents
102,520
(1,609
)
Impact of exchange rate changes on cash and cash equivalents
24
(4
)
Cash and cash equivalents - beginning of period
10,096
15,951
Cash and cash equivalents - end of period
112,640
14,338
Restatement of Previously Issued Financial Statements:
The following summarizes the effect of the restatement on each financial statement line item for each period presented.
TMC the metals company Inc. Condensed Consolidated Balance Sheets
(in thousands of US Dollars)
(Unaudited)
As at March 31, 2021
As at June 30, 2021
Accounts payable and accrued liabilities
As previously reported
6,430
9,033
Adjustments1
-
2,663
As restated
6,430
11,696
Total liabilities
As previously reported
44,075
45,869
Adjustments1
-
2,663
As restated
44,075
48,532
Additional paid in capital
As previously reported
63,576
74,069
Adjustments2
(1,848
)
(1,528
)
As restated
61,728
72,541
Deficit
As previously reported
(220,416
)
(246,573
)
Adjustments2
1,848
(1,135
)
As restated
(218,568
)
(247,708
)
Total shareholders' equity
As previously reported
25,631
15,731
Adjustments1
-
(2,663
)
As restated
25,631
13,068
TMC the metals company Inc. Condensed Consolidated Statements of Loss and Comprehensive Loss (in thousands of US Dollars, except per share amounts) (Unaudited)
Three Months Ended March 31, 2021
Three Months Ended June 30, 20214
Six Months Ended June 30, 2021
Exploration expenses
As previously reported
39,364
15,372
54,736
Adjustments1,2
(1,257
)
2,854
1,597
As restated
38,107
18,226
56,333
General and administrative expenses
As previously reported
17,955
10,311
28,266
Adjustments3
(591
)
129
(462
)
As restated
17,364
10,440
27,804
Operating loss
As previously reported
57,319
25,683
83,002
Adjustments1,2,3
(1,848
)
2,983
1,135
As restated
55,471
28,666
84,137
Loss and comprehensive loss for the period
As previously reported
57,558
26,157
83,715
Adjustments1,2,3
(1,848
)
2,983
1,135
As restated
55,710
29,140
84,850
Loss per share - Basic and diluted
As previously reported
0.30
0.13
0.43
Adjustments1,2,3
(0.01
)
0.02
0.01
As restated
0.29
0.15
0.44
TMC the metals company Inc. Condensed Consolidated Statements of Changes in Shareholders’ Equity (in thousands of US Dollars) (Unaudited)
As at March 31, 2021
As at June 30, 2021
Additional paid in capital
As previously reported
63,576
74,069
Adjustments1
(1,848
)
(1,528
)
As restated
61,728
72,541
Deficit
As previously reported
(220,416
)
(246,573
)
Adjustments1,2
1,848
(1,135
)
As restated
(218,568
)
(247,708
)
Total shareholders' equity
As previously reported
25,631
15,731
Adjustments2
-
(2,663
)
As restated
25,631
13,068
TMC the metals company Inc. Condensed Consolidated Statements of Cash Flows (in thousands of US Dollars) (Unaudited)
Three Months Ended March 31, 2021
Six Months Ended June 30, 2021
Loss for the period
As previously reported
(57,558
)
(83,715
)
Adjustments1,2
1,848
(1,135
)
As restated
(55,710
)
(84,850
)
Expenses settled in share-based payments
As previously reported
45,059
60,128
Adjustments1
(1,848
)
(1,528
)
As restated
43,211
58,600
Accounts payable and accrued liabilities
As previously reported
2,114
4,719
Adjustments2
-
2,663
As restated
2,114
7,382
The following summarizes the effect of the restatements on each line item set forth below in the unaudited pro forma condensed combined financial information previously as of and for the six months ended June 30, 2021 for each period presented.
TMC the metals company Inc. Unaudited Pro Forma Condensed Consolidated Balance Sheets As of June 30, 2021 (Amounts in U.S. dollars)
SOAC (Historical)
DeepGreen Metals (Historical)
Pro Forma Transaction Adjustments
Combined Pro Forma
Accounts payable and accrued liabilities
As previously reported
7,289
9,033
(6,713
)
9,609
Adjustments1
-
2,663
-
2,663
As restated
7,289
11,696
(6,713
)
12,272
Total liabilities
As previously reported
53,544
45,869
(55,614
)
43,799
Adjustments1
-
2,663
-
2,663
As restated
53,544
48,532
(55,614
)
46,462
Additional paid in capital
As previously reported
-
74,069
21,600
95,669
Adjustments2
-
(1,528
)
-
(1,528
)
As restated
-
72,541
21,600
94,141
Deficit
As previously reported
(53,118
)
(246,573
)
43,759
(255,932
)
Adjustments1,2
-
(1,135
)
-
(1,135
)
As restated
(53,118
)
(247,708
)
43,759
(257,067
)
Total shareholders' equity
As previously reported
(53,117
)
15,731
159,639
122,253
Adjustments1
-
(2,663
)
-
(2,663
)
As restated
(53,117
)
13,068
159,639
119,590
TMC the metals company Inc. Unaudited Pro Forma Condensed Consolidated Statement of Operations For the six months ended June 30, 2021 (Amounts in U.S. dollars, except per share data)
SOAC (Historical)
DeepGreen Metals (Historical)
Pro Forma Transaction Adjustments
Combined Pro Forma
Exploration expenses
As previously reported
-
54,736
2,343
57,079
Adjustments1,2
-
1,597
-
1,597
As restated
-
56,333
2,343
58,676
General and administrative expenses
As previously reported
6,490
28,266
-
34,756
Adjustments3
-
(462
)
-
(462
)
As restated
6,490
27,804
-
34,294
Operating loss
As previously reported
6,490
83,002
2,343
91,835
Adjustments1,2,3
-
1,135
-
1,135
As restated
6,490
84,137
2,343
92,970
(Income) loss for the period
As previously reported
(14,694
)
83,715
13,841
82,862
Adjustments1,2,3
-
1,135
-
1,135
As restated
(14,694
)
84,850
13,841
83,997
Comprehensive (income) loss for the period
As previously reported
(14,694
)
83,715
13,841
82,862
Adjustments1,2,3
-
1,135
-
1,135
As restated
(14,694
)
84,850
13,841
83,997
(Income) loss per share - Basic and diluted
As previously reported
(1.46
)
0.43
-
0.37
Adjustments1,2,3
-
0.01
-
0.01
As restated
(1.46
)
0.44
-
0.37
View source version on businesswire.com: https://www.businesswire.com/news/home/20211111006045/en/
Media | media@metals.co Investors | investors@metals.co Dan Gagnier | Gagnier Communications | tmc@gagnierfc.com
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