Key points
- The Novonix share price moves higher on quarterly activities report
- Production capacity increases with additional furnaces commissioned
- KORE Power partnership puts Novonix in the driver's seat for exclusive supply
The Novonix Ltd (ASX: NVX) share price inched ahead on Monday following the release of its quarterly report.
At the close, shares in the battery materials technology company finished 4% higher at $7.34. Despite the rally, Novonix shares are still 40% below their 52-week high.
Novonix share price rallies on jampacked quarter
It was a busy quarter for Novonix and its shareholders. Here are several notable corporate activities highlighted in the company's quarterly report:
- Phillips 66's (NYSE: PSX) nominates Zhanna Gologryga as new Novonix board member
- New Novonix Riverside synthetic graphite facility officially opened in Chattanooga, Tennessee
- Added to the S&P/ASX 200 Index (ASX: XJO)
- Received CAD$1.675 million in funding from Next Generation Manufacturing Canada
- Retaining A$259.9 million in cash at the end of the quarter
What else happened during the quarter?
The December ending quarter involved Novonix progressing with its milestones for manufacturing anode materials. A major development for the company during this time was the official opening of a facility spanning more than 400,000 square feet in the United States, sending the Novonix share price higher.
Speaking at the Riverside facility opening, US Secretary of Energy Jennifer M. Granholm said:
The local support for this means not just something for Chattanooga, and it's not just for Tennessee, but it really is for the country. The fact that we're at a facility that once employed about 230 people and that now is going to employ 300 people, making the future of our transportation energy system secure, is such a great day for America.
In addition, the company's commissioning of new equipment to meet production targets continued on track. On this note, a generation 2 furnace system is fully operational with a second system to be added in the third quarter.
Novonix noted it plans to defer deliveries to Samsung SDI and Sanyo. However, the company remains engaged with both partners and will provide material specifications based on its generation 3 furnace technology.
Furthermore, the cathode segment of the business reportedly experienced strong revenue growth. During this period, ASX-listed Novonix expanded its hardware sales and research and development offerings. The battery technology solutions team is now 56 people strong, compared to 27 at the beginning of 2021.
For the three months ended 31 December 2021, Novonix recorded A$2.22 million in receipts from customers. However, investors appear to be looking past current financial metrics as the company ramps up its battery material production capabilities.
What's next?
Lately, ASX-listed Novonix has been touting its proposed agreement with leading US-based battery developer KORE Power. As announced last week, Novonix is slated to be the exclusive supplier of graphite anode material to KORE's planned battery production facility.
From here, Novonix will continue to scale its anode production capabilities. At this stage, the company plans to complete the installation of its first two generation 3 furnace systems in the third quarter. Ultimately, continuing to increase capacity to meet its 30,000 tonnes per annum production target by 2025.
Novonix share price snapshot
The Novonix share price is up more than 170% in the last year. In other words, it has provided a far superior return to the S&P/ASX 200 Index (ASX: XJO).
However, in the past month, the excitement has begun to subside with shares falling by nearly 30%. Despite the knock, the company boasts a market capitalisation of $3.57 billion based on the current Novonix share price.
