Origin Materials launches asset-light strategy to expand biomass conversion technology

Origin Materials, a leading global carbon-negative materials company on a mission to help the world transition to sustainable materials, announced its fourth quarter and full year financial results for the year ended December 31, 2023.

Rich Riley, co-chief executive of Origin, said: "2023 is a watershed year for Origin, including the start-up of Origin 1, an important milestone in demonstrating the scalability of our biomass conversion technology."

"In addition, we have made tremendous progress on initiatives that significantly reduce the profitability risk to our business. In fact, today we are pleased to announce that due to the momentum of these initiatives,we now have a path to profitability entirely independent of the scale-up of our biomass conversion technology and related manufacturing plant construction."

"These initiatives are led by our all-PET caps and closures business, a highly differentiated solution for the caps and closures market valued at more than $65 billion. Cash burn in 2024 is expected to be below $65 million and closures beginning in 2025 with a healthy growth trajectory thereafter Therefore we expect that net cash burn will continue to decrease while maintaining a stable minimum cash floor as we achieve continued profitability, and therefore do not anticipate that we will require additional equity capital."

"With regard to Origin 2, we are initiating an Asset-Light strategy to scale our core technologies: in addition to Origin 1, we intend to expand our biomass conversion technology in collaboration with other major companies.With potential strategic partners providing the majority of construction funding, Origin's costs are expected to be significantly reduced, enhancing selectivity in how we deploy our technology." he continued.

Origin co-founder John Bissell said: "Despite the setbacks in capital projects across the industry over the past few years due to inflation, rising interest rates and supply chain shocks, demand for our biomass conversion technology remains strong. "

"So I'm particularly proud of our team's innovative agility in accelerating caps and closures as our primary path to profitability, which allows us to be more agile in executing our asset-light strategy. We are bringing cost-effective recycling to a market worth more than $65 billion, aligned with our mission to support the world's transition to sustainable materials. PET is an excellent material for bottle caps and is familiar to consumers through the number 1 recycling symbol. Our patent-pending PET caps and closures are an industry breakthrough. For a variety of containers, our technology enables the lightest caps, reducing plastic waste and increasing sustainability. They perform better than today's HDPE and PP caps, extend product shelf life, and are designed for recycling. Commercialization is progressing extremely well, with multiple leading CPG companies already conducting extensive investigations and at the LOI stage with our team." he noted.