NOS Nova (HRGI) Q3 2024 earnings summary

Executive summary

• A strategic review was initiated to explore options for CCS, clean ammonia, and project portfolio development, aiming to maximize shareholder value and secure funding, with decisions expected by year-end.

• Progress continued in carbon storage, infrastructure, and clean ammonia, though some areas advanced slower than anticipated.

• Key collaborations and license applications were made, including a Norwegian-Dutch CO2 corridor, European CCS projects, and North Sea CO2 storage.

• Barents Blue ammonia project reached a pivotal stage, with ongoing negotiations for gas supply and offtake agreements.

• Focus remains on advancing commercial maturity and cost reduction, including layoffs and reduced consultant use.

Financial highlights

• Q3 2024 operating loss was NOK 25.7 million, down ~40% year-over-year and 15% from Q2 2024.

• Net loss for Q3 2024 was NOK 24.6 million, compared to NOK 39.9 million in Q3 2023.

• Cash and cash equivalents at quarter-end were NOK 98.3 million, providing runway into the second half of 2025.

• Continued cost reductions through layoffs and decreased use of external consultants, extending capital runway.

• Management expects further reductions in operating losses in Q4 2024 and into 2025.

Outlook and guidance

• Strategic review expected to set a clear direction by year-end, with the outcome critical for future operations and funding.

• Additional financing required to secure operations beyond 1H 2025; outcome of review will determine next steps.

• Awaiting feedback on license applications and EU PMI award in Q1 next year.

• Enova/IPCEI funding for Barents Blue will be accessible after securing gas purchase and offtake term sheets.

• Barents Blue project may scale back if commercial milestones are not met; active engagement with partners continues.