Heliogen, Inc. (HLGN)·Q2 2024 Earnings Summary

Executive Summary

• Q2 revenue grew sequentially to $2.26M, driven by continued execution on the Capella project and engineering services; however, net loss widened to $(19.3)M on impairments ($4.1M) and a $1.7M inventory reserve tied to the May cost-reduction plan .
• Liquidity declined to $51.8M at June 30 from $60.7M at March 31 as the company focused on reducing non-billable costs while progressing its West Texas steam plant toward mechanical completion by year-end 2024 .
• Backlog commentary indicated no significant changes vs. Q1; outstanding proposals for early design work with four customers total 0.9 GW, signaling near-term commercial activity despite the capital-light pivot (workforce reduction and Long Beach facility closure) .
• There was no Q2 earnings call transcript; S&P Global consensus estimates for Q2 2024 were unavailable, limiting beat/miss assessment (we attempted to retrieve consensus via S&P Global but no mapping was available) [GetEstimates error noted].

What Went Well and What Went Wrong

What Went Well

• Sequential revenue growth to $2.261M from $1.528M in Q1, reflecting continued Capella execution and engineering services momentum .
• Operational progress: West Texas steam plant remains on track for mechanical completion by year-end 2024, sustaining a key commercialization milestone .
• Commercial traction: four customers engaged in early design proposals totaling 0.9 GW; CEO: “we engaged with prospective customers on several open proposals… Construction on our west Texas steam plant remains on-track for mechanical completion by the end [of] this year” .

What Went Wrong

• Profitability pressure: net loss widened to $(19.282)M, including $4.128M in impairment and other charges and a $1.7M inventory reserve; Adjusted EBITDA remained negative at $(14.595)M .
• Gross margin deterioration: gross loss of $(1.668)M in Q2 versus a small positive gross profit in Q1 ($0.051M), highlighting near-term cost absorption and restructuring effects .
• Cost actions underscore headwinds: targeted plan announced in May—~35 roles eliminated (~25% from March 31 headcount), Long Beach manufacturing facility closed, and third-party costs reduced—reflects the shift to a capital-light model in response to market and funding realities .

Financial Results

• Key drivers: Q2 revenue primarily from Capella and engineering services; net loss impacted by impairments and inventory reserve tied to restructuring; liquidity $51.8M with no debt .

KPIs and Operational Indicators

Non-GAAP Adjustments (Q2 2024)

• Adjusted EBITDA excludes impairment charges, severance costs, and manufacturing facility closing costs among other adjustments; adjustments are detailed in the reconciliation .

Guidance Changes

Earnings Call Themes & Trends

Note: Heliogen did not hold a Q2 2024 earnings call; trend commentary leverages Q4 2023 call and Q2 2024 press materials .

Management Commentary

• CEO on Q2 progress and priorities: “We engaged with prospective customers on several open proposals for early design work on commercial-scale projects… construction on our west Texas steam plant remains on-track for mechanical completion by the end this year… our team continues to focus on liquidity and opportunities to reduce non-billable costs.”
• Strategic pivot: In May, management implemented a targeted plan including a workforce reduction and Long Beach facility closure to align operations with a technology-centric, capital-light model while continuing to explore strategic alternatives .

Q&A Highlights

Note: No Q2 2024 Q&A; highlights below from the Q4 2023 call.

• Capella cost overrun and scope: ~$53M increase driven by commodity and labor inflation and first-of-a-kind development costs; management emphasized this does not change cost assumptions for the hybrid CSP-PV molten-salt offering in the sales pipeline .
• Capella path forward: pursue value engineering (e.g., reduced admin building scope, metallurgy/piping optimization, design life) and incremental funding (state/federal programs, CA tax exemptions) before advancing .
• Software licensing runway: Sandia validation supports standalone software licensing for existing heliostat fields (brownfield) and specified hardware on greenfield projects, creating nearer-term revenue potential .
• Mexico JV traction: Omanor partnership progressing site selection and offtaker engagement with an initial 50–100 MW project contemplated; pipeline contribution could be incremental to published figures .

Estimates Context

• We attempted to pull S&P Global consensus for Q2 2024 revenue and EPS but no CIQ mapping was available for HLGN; as a result, consensus estimates were unavailable and we cannot assess beat/miss for Q2 2024 (values would normally be sourced from S&P Global).
• Given the lack of consensus, we recommend focusing on sequential/YoY trends and management’s qualitative guidance. [GetEstimates error noted]

Key Takeaways for Investors

• Revenue improved sequentially, but profitability remains pressured by restructuring charges and ongoing project costs; Adjusted EBITDA loss narrowed YoY vs. Q2 2023 .
• Near-term catalyst: West Texas steam plant mechanical completion by YE2024—evidence of commercial-scale deployment and data generation to support performance guarantees and insurance partnerships .
• Capital-light pivot is underway (layoffs, facility closure) to conserve liquidity and focus on licensing and engineering-led commercialization; monitor operating cash burn and liquidity bridge into 2025 .
• Pipeline conversion remains the unlock; 0.9 GW of early design proposals with four customers suggests progress on upstream activities, though backlog remained broadly unchanged .
• Capella costs and funding remain a watch item; management intends to avoid absorbing incremental cash losses, pursuing value engineering and external funding before moving forward .
• Absence of consensus estimates and no Q2 call reduces near-term visibility; track subsequent disclosures, 8-Ks, and press releases for additional detail on backlog, bookings, and cash .

Citations:

• Q2 2024 press release and attached financials .
• May 20, 2024 8-K on cost actions .
• Q1 2024 8-K .
• Q4 2023 8-K and call .