BAINBRIDGE, Ga. - Danimer Scientific, Inc. (NYSE: DNMR), a bioplastics company specializing in biodegradable materials, has secured a $20 million asset-based revolving credit facility with Mountain Ridge Capital. The agreement, announced Monday, is backed primarily by the company's accounts receivable and inventory.
Under the terms of the credit and security agreement, which was entered into on April 19, 2024, Danimer has the option to increase the commitment by an additional $5 million. The facility is set to mature on or about April 19, 2027, with earlier maturity possible if certain events occur. The company plans to use the revolving loans for general corporate purposes and working capital needs.
Danimer Scientific is known for its efforts in creating sustainable plastic products that are biodegradable and compostable. With a focus on reducing the environmental impact of plastics, Danimer's biopolymers are used in a variety of applications, including coatings, fibers, and injection-molded articles. The company holds over 480 granted and pending patents across more than 20 countries.
The funding is expected to support Danimer's operational and production facility expansions, which are part of its strategy to meet the growing customer demand for its products. This move comes at a time when the company is navigating a landscape marked by consumer preference shifts, economic changes, and regulatory challenges.
Investors are advised that this press release contains forward-looking statements, which are based on the company's current expectations and projections about future events. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated.
Danimer's public reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, detail these risks.
The information in this article is based on a press release statement from Danimer Scientific.
InvestingPro Insights
As Danimer Scientific, Inc. (NYSE: DNMR) secures a new credit facility to fuel its operations and expansion efforts, a closer look at the company's financial health and market performance is critical for investors.
According to real-time data from InvestingPro, Danimer's market capitalization stands at a modest $88.57 million. The financial metrics highlight some challenges, with a negative price-to-earnings (P/E) ratio of -0.50 for the last twelve months as of Q4 2023, indicating that the company is not currently profitable.
The Price / Book ratio, a metric that compares a company's market value to its book value, is notably low at 0.32 for the same period, which might suggest the stock is undervalued relative to its assets. This aligns with one of the InvestingPro Tips that Danimer is trading at a low Price / Book multiple, potentially offering an entry point for value investors.
Another InvestingPro Tip points out that the stock is in oversold territory according to the Relative Strength Index (RSI), which could signal a buying opportunity for contrarian investors or those looking for a potential rebound.
For investors seeking comprehensive analysis and additional insights, InvestingPro offers a suite of tips and metrics; in fact, there are 14 additional InvestingPro Tips available for Danimer Scientific, accessible through their dedicated page.
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With the next earnings date slated for May 8, 2024, stakeholders will be keenly watching how the new credit line and operational expansions impact Danimer's financial trajectory in the face of market volatility and the company's debt burden.
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