RENO, Nev. - American Battery Technology Company (NASDAQ: ABAT), a pioneer in critical battery materials technology, has been granted an additional $40.5 million in tax credits to expedite the development of a new commercial battery recycling facility in the United States. This funding, awarded through the Qualifying Advanced Energy Project Credits program (48C), complements a previous $20 million tax credit and aims to bolster the domestic supply chain for recycled battery metals.
The U.S. Department of Treasury and the Internal Revenue Service allocated the funds after a rigorous review by the Department of Energy (DOE), which assessed the project's potential to enhance America's competitive stance in critical material recycling, processing, and refining.
ABTC CEO Ryan Melsert emphasized the company's collaboration with automotive OEMs and battery cell manufacturers to provide domestic, cost-effective, and environmentally friendly recycling services. With the current Nevada facility reaching its processing capacity, ABTC is advancing plans for a larger-scale plant that aligns with partner facilities in terms of location and throughput.
The company's unique recycling process, which has garnered multiple awards and government grants, features a strategic de-manufacturing approach followed by a targeted chemical extraction process. This method contrasts with conventional high-temperature smelting or non-strategic shredding systems, focusing on high yields, low costs, and minimal environmental impact.
With over $60 million from the 48C program and $70 million in DOE grants, ABTC is committed to fostering a circular supply chain for battery metals. The company also aims to improve community job access, including for under-represented individuals and those facing employment barriers, leveraging DOE investments and partnerships with workforce development and government agencies.
Based on a press release statement.
InvestingPro Insights
As American Battery Technology Company (ABAT) secures additional funding for its battery recycling facility, investors are keeping a close eye on the company's financial health and stock performance. According to real-time data from InvestingPro, ABAT's market capitalization stands at $90.8 million, reflecting its current valuation in the market. However, the company's P/E ratio is negative, at -3.15, suggesting that it is not currently profitable. In the last twelve months as of Q2 2024, ABAT's operating income was reported at a loss of -$27.43 million, further emphasizing the company's financial challenges.
InvestingPro Tips highlight several areas of concern for ABAT. The company has been "quickly burning through cash," which could impact its ability to sustain operations without additional funding or revenue streams. Moreover, ABAT "suffers from weak gross profit margins" and has experienced "significant price falls" over the last year, with a 1-year price total return of -85.41%. These factors, combined with the fact that ABAT is "trading near its 52-week low," might give investors pause as they consider the stock's potential for recovery.
Despite these challenges, the recent funding news could provide a positive outlook for the company's future growth and its role in the domestic battery recycling industry. For investors seeking a more comprehensive analysis, InvestingPro offers additional insights, including a total of 12 InvestingPro Tips for ABAT, which can be accessed at https://www.investing.com/pro/ABAT. To gain deeper insights into ABAT and other companies, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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