Smartkem Reports Second Quarter 2024 Financial Results
Rhea-AI Summary
Smartkem (Nasdaq: SMTK), a company developing organic thin-film transistors (OTFTs) for next-generation displays, reported its Q2 2024 financial results. Key highlights include:
1. Uplisting to Nasdaq in May 2024
2. Revenue of $40,000 in Q2 2024, up from $8,000 in Q2 2023
3. Operating expenses increased to $3.0 million from $2.5 million year-over-year
4. Cash and cash equivalents of $4.4 million as of June 30, 2024
The company is pursuing a three-pillared commercialization strategy: improving proprietary materials, developing electronic design automation tools, and providing access to foundry services. Smartkem has entered into several collaborations and agreements to advance its OTFT technology in various applications.
Positive
- Uplisted to Nasdaq Stock Market, potentially increasing marketability and liquidity
- Revenue increased from $8,000 in Q2 2023 to $40,000 in Q2 2024
- Entered into multiple strategic collaborations and agreements to advance OTFT technology
Negative
- Operating expenses increased from $2.5 million in Q2 2023 to $3.0 million in Q2 2024
- Cash and cash equivalents decreased from $8.8 million on December 31, 2023, to $4.4 million on June 30, 2024
- Net loss increased from $2.0 million in Q2 2023 to $3.1 million in Q2 2024
News Market Reaction – SMTK
On the day this news was published, SMTK declined 1.52%, reflecting a mild negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Recent Business Highlights
During Q1 and Q2 2024, Smartkem:
- Announced that it had uplisted to The Nasdaq Stock Market.
- Commenced a project with RiTdisplay, with whom it entered into a joint development agreement in 2021, to develop the world's first commercially ready active-matrix OLED (AMOLED) display using OTFT technology. This new project is funded by Innovate
UK (part ofUK Research and Innovation (UKRI)), as part of the Taiwan-UK Research & Development Collaboration. - Entered into a technology collaboration agreement with the Industrial Technology Research Institute (ITRI) in
Taiwan . - Began collaborating with FlexiIC to develop low-cost, rapid turnaround custom circuits using OTFT technology.
- Entered into a joint development agreement with Tianma to develop OTFT biosensors.
- Joined the Hi-Accµracy Project to develop active-matrix printed Q-LED displays.
- Exhibited and gave company presentations at key trade industry conferences including Touch Taiwan 2024 and Display Week 2024 in San Jose, where CEO Ian Jenks gave a keynote speech at the DSCC / SID Business Conference.
Q2 2024 Financial Highlights:
- Cash and cash equivalents as of June 30, 2024, were
$4.4 million $8.8 million - Operating expenses for the three months ended June 30, 2024, were
$3.0 million $2.5 million - Revenues for the three months ended June 30, 2024, were
$40.0 thousand $8.0 thousand - In May 2024, Smartkem received approval to list its common stock on the Capital Market tier of The Nasdaq Stock Market LLC ("Nasdaq") under the symbol "SMTK". Trading on Nasdaq commenced with the open of trading on Friday, May 31, 2024.
CEO Outlook Commentary:
Smartkem Chairman and CEO, Ian Jenks, comments,
"The most exciting 2024 milestone for the company so far is the recent announcement of our uplist to Nasdaq. We are proud to now be trading on the world's premier technology stock exchange and believe that it will result in increased marketability and liquidity."
"In the first half of 2024, we delivered against our commitment to increase our marketing efforts and participation in the major global technology conferences, and, crucially, believe we have continued to demonstrate company success and viability through the delivery of our robust three-pillared commercialization strategy that has remained consistent: continuous improvement of our proprietary materials, the development of electronic design automation (EDA) tools, and access to foundry services."
"We are committed to continuous improvement of our best-in-class materials, supported by ongoing confidence from both the industry and investor communities. We intend to deploy EDA tools to the market through our partnership with FlexiIC, enabling customers to rapidly develop circuitry at low cost for new applications in sensors, internet-of-things (IOT) or other applications. We also intend to grant our customers access to foundry services and have entered into a technology transfer agreement with the Industrial Technology Research Institute (ITRI) in
"We remain confident that our continued efforts to pursue our three-pillared strategy will lead to commercialization and the sale of our materials to both foundry services and to our customers who have transferred our technology to their own fabrication lines."
Q2 2024 Results:
Revenue and Cost of revenue
Smartkem had revenue of
Other operating income
Other operating income was
Operating expenses
Operating expenses were
Research and development expenses are incurred for the development of TRUFLEX® inks to make OTFT circuits and consist primarily of payroll and technical development costs. The research and development expenses represent
Selling, general and administrative expenses consist primarily of payroll and professional services such as accounting, legal services and investor relations. These expenses represent
Non-Operating income /Expense
We recorded a loss of
Cash Flow from Operating Activities
Net cash used in operating activities was
Smartkem's Nasdaq information can be found on the Nasdaq website: https://www.nasdaq.com/market-activity/stocks/smtk
SMARTKEM, INC. | ||||||
Condensed Consolidated Balance Sheets | ||||||
(Unaudited) | ||||||
(in thousands, except number of shares and per share data) | ||||||
June 30, | December 31, | |||||
2024 | 2023 | |||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 4,351 | $ | 8,836 | ||
Accounts receivable | — | 268 | ||||
Research and development tax credit receivable | 967 | 610 | ||||
Prepaid expenses and other current assets | 1,186 | 811 | ||||
Total current assets | 6,504 | 10,525 | ||||
Property, plant and equipment, net | 327 | 455 | ||||
Right-of-use assets, net | 226 | 285 | ||||
Other assets, non-current | 6 | 7 | ||||
Total assets | $ | 7,063 | $ | 11,272 | ||
Liabilities and stockholders' equity | ||||||
Current liabilities | ||||||
Accounts payable and accrued expenses | $ | 1,903 | $ | 1,178 | ||
Lease liabilities, current | 209 | 230 | ||||
Other current liabilities | 347 | 360 | ||||
Total current liabilities | 2,459 | 1,768 | ||||
Lease liabilities, non-current | 16 | 19 | ||||
Warrant liability | — | 1,372 | ||||
Total liabilities | 2,475 | 3,159 | ||||
Commitments and contingencies (Note 7) | — | — | ||||
Stockholders' equity: | ||||||
Preferred stock, par value | — | — | ||||
Common stock, par value | — | — | ||||
Additional paid-in capital | 112,965 | 104,757 | ||||
Accumulated other comprehensive loss | (1,422) | (1,578) | ||||
Accumulated deficit | (106,955) | (95,066) | ||||
Total stockholders' equity | 4,588 | 8,113 | ||||
Total liabilities and stockholders' equity | $ | 7,063 | $ | 11,272 | ||
* reflects a one-for-thirty-five (1:35) reverse stock split effected on September 21, 2023 | ||||||
SMARTKEM, INC. | ||||||||||||
Condensed Consolidated Statements of Operations and Comprehensive Loss | ||||||||||||
(Unaudited) | ||||||||||||
(in thousands, except number of shares and per share data) | ||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||
Revenue | $ | 40 | $ | 8 | $ | 40 | $ | 24 | ||||
Cost of revenue | 32 | 6 | 32 | 22 | ||||||||
Gross profit | 8 | 2 | 8 | 2 | ||||||||
Other operating income | 236 | 169 | 438 | 438 | ||||||||
Operating expenses | ||||||||||||
Research and development | 1,158 | 1,257 | 2,434 | 2,536 | ||||||||
Selling, general and administrative | 1,844 | 1,324 | 3,206 | 2,757 | ||||||||
Loss on foreign currency transactions | 19 | (43) | 32 | 68 | ||||||||
Total operating expenses | 3,021 | 2,538 | 5,672 | 5,361 | ||||||||
Loss from operations | (2,777) | (2,367) | (5,226) | (4,921) | ||||||||
Non-operating income/(expense) | ||||||||||||
Gain/(loss) on foreign currency transactions | (243) | 533 | (249) | 1,035 | ||||||||
Transaction costs allocable to warrants | — | (198) | — | (198) | ||||||||
Change in fair value of the warrant liability | (81) | 3 | 672 | 3 | ||||||||
Interest income | 3 | 2 | 9 | 6 | ||||||||
Total non-operating income/(expense) | (321) | 340 | 432 | 846 | ||||||||
Loss before income taxes | (3,098) | (2,027) | (4,794) | (4,075) | ||||||||
Income tax expense | (1) | — | (1) | — | ||||||||
Net loss | $ | (3,099) | $ | (2,027) | $ | (4,795) | $ | (4,075) | ||||
Net loss | $ | (3,099) | $ | (2,027) | $ | (4,795) | $ | (4,075) | ||||
Other comprehensive loss: | ||||||||||||
Foreign currency translation | 174 | (517) | 156 | (973) | ||||||||
Total comprehensive loss | $ | (2,925) | $ | (2,544) | $ | (4,639) | $ | (5,048) | ||||
Common share data: | ||||||||||||
Basic net loss per common share* | $ | (0.98) | $ | (1.82) | $ | (1.63) | $ | (4.18) | ||||
Diluted net loss per common share* | $ | (0.98) | $ | (1.82) | $ | (4.04) | $ | (4.18) | ||||
Dividend per common share | $ | — | $ | — | $ | (2.41) | $ | — | ||||
Weighted average number of basic shares outstanding* | 3,157,334 | 1,111,954 | 2,946,354 | 974,599 | ||||||||
Weighted average number of diluted shares outstanding* | 3,157,334 | 1,111,954 | 2,946,354 | 974,599 | ||||||||
* reflects a one-for-thirty-five (1:35) reverse stock split effected on September 21, 2023 | ||||||||||||
About Smartkem
Smartkem is seeking to reshape the world of electronics with its disruptive organic thin-film transistors (OTFTs) that have the potential to drive the next generation of displays. Smartkem's patented TRUFLEX® semiconductor and dielectric inks, or liquid electronic polymers, can be used to make a new type of transistor that has the potential to revolutionize the display industry. Smartkem's inks enable low temperature printing processes that are compatible with existing manufacturing infrastructure to deliver low-cost displays that outperform existing models. The company's electronic polymer platform can be used in a number of display technologies including microLED, miniLED and AMOLED displays for next generation televisions, laptops, augmented reality (AR) and virtual reality (VR) headsets, smartwatches and smartphones.
Smartkem develops its materials at its research and development facility in
Forward-Looking Statements
All statements in this press release that are not historical are forward-looking statements, including, among other things, statements relating to the Smartkem's expectations regarding its market position and market opportunity, expectations and plans as to its product development, manufacturing and sales, and relations with its partners and investors. These statements are not historical facts but rather are based on Smartkem Inc.'s current expectations, estimates, and projections regarding its business, operations and other similar or related factors. Words such as "may," will," "could," "would," "should," "anticipate," "predict," "potential," "continue," "expect," "intend," "plan," "project," "believe," "estimate," and other similar or elated expressions are used to identify these forward-looking statements, although not all forward-looking statements contain these words. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and assumptions that are difficult or impossible to predict and, in some cases, beyond the Company's control. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to revise or update information in this release to reflect events or circumstances in the future, even if new information becomes available.
View original content:https://www.prnewswire.com/news-releases/smartkem-reports-second-quarter-2024-financial-results-302220118.html
SOURCE SmartKem, Inc.
FAQ
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