What happened
Shares of Li-Cycle (NYSE: LICY) fell Monday following the publication of the company's second-quarter report. The lithium-ion battery recovery specialist's share price fell 13.3% in the daily session, according to data from S&P Global Market Intelligence.
Li-Cycle released its Q2 results before the market opened today, delivering sales that met the market's expectations but reflected a wider-than-expected loss. The company posted a loss of $0.20 per share on revenue of $3.6 million, but the average analyst estimate had called for a per-share loss of $0.17 in the period.
So what
Li-Cycle is aiming to be a leading recycler of lithium-ion batteries and producer of key battery-grade materials. The Toronto-based company is still in the relatively early stages of expanding its lithium-ion recycling business and building its global operations, and it continues to post significant losses as it makes moves to scale.
Li-Cycle recorded a net loss of $35.3 million in Q2 this year, up from the $28.1 million loss it posted in last year's second quarter. The company posted product revenue of $3.1 million and recycling services revenue of $500,000.
Total revenue of $3.6 million came in much better than the $0 in revenue that it posted in a last year's second quarter -- a period in which negative adjustment to sales from product balanced out proceeds from recycling services. On the other hand, the business recorded $8 million in sales across the first half of last year and has only posted $7.2 million in sales across this year's first half.
Now what
Li-Cycle has seen volatile trading since it went public through a merger with a special purpose acquisition company (SPAC) two years ago. The company's share price is now down roughly 55% from market close on the day of its public debut.
Li-Cycle has seen revenue fluctuate in conjunction with shifts in prices for cobalt and nickel. Unfavorable trends have led to softer sales performance and expanding losses, but the business seems to have solid financial footing. The company closed out Q2 with $388.8 million in cash on hand, and it expects loans from the Department of Energy to close in September that will help its U.S.-based expansion.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
