TMC Announces First Quarter 2024 Results

NEW YORK, May 13, 2024 (GLOBE NEWSWIRE) — TMC the metals company Inc. (Nasdaq: TMC) (“TMC” or “the Company”), an explorer of lower-impact battery metals from seafloor polymetallic nodules, today provided a corporate update and first quarter financial results for the period ending March 31, 2024.

Q1 2024 Financial Highlights

• $11.9 million cash used in operations for the quarter ended March 31, 2024
• Net loss of $25.2 million and net loss per share of $0.08 for the quarter ended March 31, 2024
• Total liquidity of approximately $49 million at March 31, 2024, inclusive of:  – Cash of $4.0 million
• The $25 million unsecured credit facility from an affiliate of Allseas Group SA with a maturity date of August 2025
• The $20 million unsecured credit facility with a maturity date of September 2025 provided by our largest shareholder, ERAS Capital LLC (the family office of TMC director Andrei Karkar), and our Chairman & CEO, Gerard Barron
• Subsequent to March 31, 2024, TMC has drawn approximately $2.9 million on the unsecured credit facility provided by ERAS Capital LLC and Gerard Barron

Gerard Barron, Chairman & CEO of The Metals Company commented: “2024 is the year when most of the speculations about the environmental impacts of our emerging industry will be displaced by data and evidence. Earlier this month, NORI made another large data submission to the International Seabed Authority – NORI’s environmental baseline dataset is the largest of its kind ever gathered in the deep sea and, with still more data being prepared for another submission later this year, I am confident that our efforts over the past 12 years will provide the regulator with the data it needs to make informed decisions regarding our expected application for a NORI exploitation contract. With the continued support provided once again by our largest shareholders as announced in our year-end corporate update, we feel confident that we have the financial flexibility to deliver a world-class application.”

“Geopolitically, the U.S. is actively exploring the potential of deep-seafloor minerals, with the Pentagon currently conducting an analysis of domestic nodule processing and refining opportunities. Meanwhile, several Chinese contractors have announced plans to begin polymetallic nodule collection tests as early as 2025. While we do not have certainty on the date of the Pentagon report’s completion, I’m encouraged by the work being done by the Department of Defense and other departments. Further, we’re in active dialogue with members of Congress regarding the prioritization of feasibility work for the future refining of nodule-derived products in the United States, building on the existing base of support demonstrated in last year’s National Defense Authorization Act. We look forward to sharing more developments on this front in the coming weeks and months.”

Operational Highlights Since Last Corporate Update

• Steve Jurvetson Joins TMC’s Board of Directors as Vice Chairman and Special Advisor to the CEO:In April 2024, renowned Silicon Valley investor Steve Jurvetson joined our board of directors as Vice Chairman and special advisor to the CEO. Mr. Jurvetson is an investor focused on founder-led, mission-driven companies at the cutting edge of disruptive technology and new industry formation. His investments include pioneering technology companies like Tesla, Planet Labs, SpaceX and Commonwealth Fusion Systems, and represent over $800 billion in aggregate value creation.
• World-First Production of Nickel Sulfate from Deep-Seafloor Polymetallic Nodules:In April 2024, we announced that we had successfully produced the world’s first nickel sulfate derived exclusively from seafloor polymetallic nodules during pilot-scale nodule processing. In partnership with SGS Canada Inc, the testing was undertaken on samples of nickel-cobalt-copper matte produced by TMC in 2021 using the Company’s efficient flowsheet to process high-grade nickel matte directly to nickel sulfate without making nickel metal, while producing fertilizer byproducts instead of solid waste or tailings.
• Extensive Submission of Deep-Sea Environmental Data to the ISA:In May 2024, we announced that our subsidiary NORI had made a second submission of key environmental data from all prior environmental baseline campaigns conducted in the NORI-D exploration area up to January 2022 to DeepData, an open database of contractor data managed by the International Seabed Authority (ISA). The submission of this massive batch of data includes an extensive set of geochemical and biological samples from across the water column.

Industry Update

• ISA Consolidated Draft Regulations:In February 2024, the ISA published a consolidated set of draft regulations for the first time, harmonizing and cleaning up the text. The 225-page text is comprehensive and signals the next phase in the negotiations. Part 1 of the ISA’s 29th Session took place between March 18-29, 2024. During the Session, the ISA Council commenced negotiations on the new consolidated text and identified a number of areas for negotiation inter-sessionally.
• Responsible Use of Seafloor Resources Act (RUSRA):In March 2024, legislation was introduced in the U.S. House of Representatives calling for the U.S. to “support international governance of seafloor resource exploration and responsible polymetallic nodule collection by allied partners”, and to “provide financial, diplomatic, or other forms of support for seafloor nodule collection, processing and refining.”

Financial Results Overview

At March 31, 2024, we held cash of approximately $4.0 million and held no financial debt. We believe that our total liquidity including cash and borrowing availability under a credit facility with an affiliate of Allseas, and our credit facility with ERAS Capital LLC and Mr. Barron, will be sufficient to meet our working capital and capital expenditure commitments for at least the next twelve months from today.

We reported a net loss of approximately $25.2 million, or $0.08 per share for the quarter ended March 31, 2024, compared to net loss of $13.7 million, or $0.05 per share, for the quarter ended March 31, 2023. Exploration and evaluation expenses during the quarter ended March 31, 2024 were $18.1 million compared to $7.2 million for the quarter ended March 31, 2023. The significant decrease in the exploration and evaluation expenses in the first quarter of 2024 was primarily due to an increase in mining, technological and process development of $10.4 million due to increased engineering work and expenses incurred on the transportation of nodules to PAMCO’s facility in Japan, and higher personnel costs. This was partially offset by a decrease in environmental studies as the cost for Campaign 8 which commenced in the fourth quarter of 2023 was completed in the first quarter of 2024, and was lower than the cost of the environmental work in the first quarter of 2023 following the completion of the NORI integrated collector test.

General and administrative expenses were $6.6 million for the quarter ended March 31, 2024 compared to $6.2 million for the quarter ended March 31, 2023, reflecting higher amortization of share-based compensation and higher consulting fees, offset by lower legal costs.

Conference Call

We will hold a conference call today at 4:30 p.m. EDT to provide an update on recent corporate developments, first quarter 2024 financial results and upcoming milestones.

| First Quarter 2024 Conference Call Details | |

| Date: | Monday, May 13, 2024 |

| Time: | 4:30 pm EDT |

| Audio-only Dial-in: | Register Here |

| Virtual webcast w/ slides: | Register Here |

Please register with the links above at least ten minutes prior to the conference call. The virtual webcast will be available for replay in the ‘Investors’ tab of the Company’s website under ‘Investors’ > ‘Media’ > ‘Events and Presentations’, approximately two hours after the event.

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 global energy transition with the least possible negative impacts on planet and people and (2) trace, recover and recycle the metals we supply to help create a metals commons that can be used in perpetuity. 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.

Contacts

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