Gapwaves (GAPW) Q2 2024 earnings summary

Executive summary

• Business plan revised to focus on high-value applications and market-driven growth, with ongoing efforts to secure funding and extend operational runway through 2026.

• Net sales for Q2 2024 reached MSEK 14.5, up 62.9% year-over-year, with strong growth in both sales and product deliveries.

• Serial production commenced for antennas developed for Smartmicro and Hella, marking key milestones in scaling up operations.

• Commercialization efforts intensified, with new distribution agreements and partnerships in pharma, cosmetics, and green solvents.

• Expanded agreements with Bosch and new orders from European and Asian Tier 1 suppliers highlight growing market traction.

Financial highlights

• Q2 2024 operating revenue was €136k, down from €598k in Q2 2023; YTD 2024 revenue at €279k versus €772k YTD 2023.

• Q2 2024 net sales: MSEK 14.5 (Q2 2023: MSEK 8.9), a 62.9% increase; H1 2024 net sales: MSEK 30.1 (H1 2023: MSEK 13.8), up 118.1%.

• Net loss before tax for Q2 2024 was €2.08m, compared to €1.05m in Q2 2023; YTD net loss before tax at €4.02m versus €2.66m YTD 2023.

• Q2 EBITDA: MSEK -12.5 (Q2 2023: MSEK -12.9); adjusted EBITDA: MSEK -8.8 (Q2 2023: MSEK -9.5).

• Cash and cash equivalents at period end: MSEK 66.9 (Q2 2023: MSEK 119.7); total cash and equivalents at €2.4m in Q2 2024, down from €27.5m in Q2 2023.

Outlook and guidance

• All funding options under evaluation, including asset sales, to address €60m funding need through 2026.

• Scaling up continues with investments in a pilot line for industrialization, aiming for industry certification and volume production starting in 2026.

• Focus remains on securing environmental permit and funding for Resolute, with permit expected by mid-October.

• Market demand for waveguide antennas is expected to grow, driven by regulatory changes and increased radar adoption in vehicles.

• Continued push for distribution and off-take agreements, and optimization of product mix.