Investing.com -- Aspen Aerogels shares surged more than 13% Wednesday following the announcement of a major funding development and strong preliminary Q3 2024 results.
The company revealed it had secured a conditional commitment from the U.S. Department of Energy (DOE) for a loan of up to $670.6 million.
The funding, part of the Advanced Technology Vehicles Manufacturing loan program, will finance the construction of Aspen's second aerogel manufacturing facility in Register, Georgia.
According to Aspen, the new plant will provide a revenue capacity between $1.2 billion and $1.6 billion, driven by the production of its PyroThin thermal barriers, designed to enhance battery safety for electric vehicles (EVs).
Aspen CEO Donald Young emphasized the importance of the DOE's commitment: "The proposed loan would fully fund the required CAPEX for our second aerogel manufacturing facility, which is expected to play a key role in scaling our PyroThin supply for our rapidly growing Thermal Barrier business."
Young added that Aspen's PyroThin product has attracted six major OEM contracts in the U.S. and Europe and contributed to a 277% year-over-year growth in thermal barrier revenues.
Aspen also provided preliminary Q3 financial results, reporting $117 million in revenue and $25 million in adjusted EBITDA. However, the company posted a net loss of $13 million, impacted by a one-time $27.5 million charge from the extinguishment of a convertible note.
Chief Financial Officer Ricardo Rodriguez highlighted the loan's financial impact: "This proposed loan, and its terms, will provide us, if finalized, with the opportunity to optimize our capital structure and capture the long-term opportunity that is in front of us."
The Register Plant project is expected to create 255 permanent jobs and aligns with the DOE's goal of supporting domestic manufacturing for zero-emissions vehicles, further driving optimism around Aspen's growth potential.