Overview

Advent Technologies Holdings, Inc. is an advanced materials and technology development company operating in the fuel cell, methanol, and hydrogen technology space. Advent is a world-leading company in the development of the HT-PEM technology, which enables off-grid power systems to produce clean power from various green fuels.

Advent’s core product offerings are fuel cell stacks and the Membrane Electrode Assembly (MEA), which is the critical component of the fuel cell. Advent’s MEA technology enables high power-density, longer-lasting and lower-cost fuel cell products.

Advent’s principal operations have been to develop and manufacture MEAs, and to design fuel cell stacks and complete fuel cell systems for a range of applications in the stationary power, portable power, automotive, aviation, energy storage and sensor markets. The majority of Advent’s current revenue derives from Joint Development Agreements (JDAs) and Technology Assessment Agreements (TAAs) with world-leading OEMs.

Business Developments

Green HiPo Project approved by EU In July 2022, Advent received official ratification from the European Commission for the Green HiPo project, which is designed to bring the development, design, and manufacture of HT-PEM fuel cells and electrolysers to the Western Macedonia region of Greece. However, due to delays in securing the required funding, Advent does not expect any disbursement of the state aid package in the near future.

Airbus Term Sheet to Launch a Joint Benchmarking Project In November 2023, Advent announced a term sheet with Airbus for a joint benchmarking project regarding an optimized Ion Pair™ Membrane Electrode Assembly (MEA) for hydrogen fuel cells. The goal is to accelerate the development of Advent’s MEA and benchmark it against aviation requirements.

At the Market Offering Agreement In June 2023, Advent entered into an At The Market Offering Agreement with H.C. Wainwright & Co., LLC to sell up to $50 million of shares of Advent’s Common Stock. As of June 30, 2024, the Agent had sold an aggregate of 232,672 shares for total consideration to the Company of $1.7 million.

Hood Park Facility In March 2023, Advent opened a new R&D and manufacturing facility at Hood Park in Boston, Massachusetts. However, in June 2024, the Company decided to abandon the facility in an effort to reduce costs.

Collaboration with the Department of Energy Advent continues to work closely with a constellation of Department of Energy National Laboratories to further the understanding of breakthrough materials that will advance HT-PEM fuel cells.

Agreements with Hyundai Motor Company In April 2022, Advent signed a technology assessment, sales, and development agreement with Hyundai. In March 2023, the companies entered into a Joint Development Agreement to further develop HMC-Advent Ion Pair™ MEA and evaluate Advent’s advanced fuel cell technology.

Selection of Wearable Fuel Cell for the DOD 2021 Validation Program In March 2021, Advent’s 50 W Reformed Methanol Wearable Fuel Cell Power System was selected by the DoD National Defense Center for Energy and Environment to take part in its demonstration/validation program.

Launch of the Honey Badger 50™ Fuel Cell System In August 2022, Advent launched its HB50 power system, a compact portable fuel cell system for use in off-grid field applications such as military and rescue operations. Advent has since secured additional contracts with the U.S. Department of Defense to further optimize the HB50 system.

Advent Technologies A/S declared bankrupt On July 25, 2024, Advent Technologies A/S was declared bankrupt by the court in Aalborg, Denmark. The remainder of the Company’s legal entities have no plans to declare bankruptcy and will continue as going concern entities.

Key Factors Affecting Our Results

Increased Customer Demand Advent anticipates substantial increased demand for its fuel cell systems and MEAs as it scales up production and testing capabilities, and as awareness of its MEA capabilities becomes widely known.

Successful development of the Advanced MEA product Advent’s future success depends on the successful development of its next generation MEA technology, which is anticipated to deliver significantly improved power output and cost/kW performance.

Basis of Presentation and Components of Results of Operations Advent’s consolidated financial statements are prepared in accordance with U.S. GAAP. The company’s revenue consists of sales of goods and services, as well as engineering fees and revenue from JDAs and TAAs. Cost of revenues, research and development expenses, administrative and selling expenses, and amortization of intangibles are the key components of Advent’s results of operations.

Results of Operations Advent’s total revenue decreased by $0.3 million in Q2 2024 compared to Q2 2023, driven by a reduction in product sales as the company shifted towards services under JDAs and TAAs. Cost of revenues decreased by $1.8 million over the same period due to the shift in revenue mix.

Research and development expenses increased by $0.7 million in Q2 2024 compared to Q2 2023, while administrative and selling expenses decreased by $2.0 million over the same period due to cost reduction efforts.

Advent recognized significant impairment losses of $9.8 million in Q2 2023 related to goodwill and intangible assets from prior acquisitions.

Liquidity and Capital Resources As of June 30, 2024, Advent had $0.7 million in cash and cash equivalents, and a working capital deficit of $8.9 million. The company’s ability to meet its liquidity needs will largely depend on its ability to raise capital in the very short term and generate cash in the future. Management has concluded that substantial doubt exists with respect to Advent’s ability to continue as a going concern for one year from the date the consolidated financial statements are issued.

Non-GAAP Measures Advent presents EBITDA, Adjusted EBITDA and Adjusted Net Loss as supplemental non-GAAP measures to assist readers in evaluating the company’s operating performance. These measures exclude the impact of certain non-cash and one-time items.