PureCycle Technologies, Inc. (PCT)·Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 marked a transition to early commercialization: Ironton produced 3.6MM lbs, compounded ~4MM lbs, and management highlighted improving reliability (67% onstream in December) and a “to date” record feed rate of 12.5 klbs/hr achieved shortly after the quarter, supporting line-of-sight to nameplate capacity .
• Commercial traction accelerated: first meaningful purchase order in fiber from Drake Extrusion (late January), Churchill Container launched “Run It Back” cups/popcorn buckets made with up to 100% PureFive resin (early February), and five industrial trials with P&G brands are targeting full approvals in early Q2 with production ramp into Q2–Q3 2025 .
• Liquidity tightened into year-end ($15.7MM unrestricted cash at 12/31/24), but PCT raised ~$33MM on Feb 6, 2025 and expects to sell ~$118MM of revenue bonds in 2025; Q4 cash expenses were ~$68MM (or ~$27MM adjusting for growth CapEx and a bond interest payment) .
• Estimate comparisons: Wall Street consensus (S&P Global) for Q4 2024 revenue/EPS was not accessible at this time; PCT’s 8-K corporate update did not disclose GAAP revenue/EPS in the press release. Investors should focus on operational KPIs and commercialization milestones until financial statements are consulted .

What Went Well and What Went Wrong

• What Went Well

  • Record operational capability and reliability momentum: Ironton December onstream reached 67% and management cited “almost 70%,” with a new record feed rate of 12.5 klbs/hr achieved to date, underpinning confidence in approaching nameplate .
  • Commercial wins and pipeline breadth: first purchase order from Drake in fiber; Churchill launched a product line using PureFive; 29 active trials (16 industrial) and 42 pending, implying 250–500MM lbs of potential active trial volume and >1B lbs from pending applications .
  • P&G relationship strengthened: amended license providing exclusivity in North America and extended exclusivity timing in other regions; five P&G brand applications entering industrial trials with expected full approvals in early Q2 and ramp into Q2–Q3 2025 .

• What Went Wrong

  • Liquidity compression into year-end: unrestricted cash fell from $83.7MM at 9/30/24 to $15.7MM at 12/31/24, necessitating a $33MM equity raise in February and reliance on expected bond sales in 2025 .
  • Cash burn remains elevated: Q4 cash expenses were ~$68MM, though management noted ~$27MM excluding growth CapEx and a bond interest payment; monthly burn now ~$9.0–9.5MM with Denver onboarding .
  • Sales pacing limits near-term production ramp: management is deliberately pacing plant production to match specific customer application qualifications, limiting inventory build and creating a gating factor tied to trial timelines and working-capital discipline .

Financial Results

Note: The Q4 2024 8-K corporate update did not disclose revenue or EPS in the press release; the call focused on operations, liquidity, and commercialization. Consensus estimates were not accessible via S&P Global at this time .

• Operational KPIs progression

• Liquidity and cash use

• Commercial pipeline and pricing

Guidance Changes

(Operational and commercialization timelines discussed vs. prior updates)

Earnings Call Themes & Trends

Management Commentary

• “Our onstream time was nearly 70% in December, a new high, and we hit a max feed rate of 12,500 pounds per hour in February.”
• “We are underway with 29 trials…16 on an industrial scale…approximately 250–500 million pounds per year at steady state…42 trials that should begin soon…could unlock north of 1 billion pounds of demand.”
• “We continue to stand by…the sales price…being…$1.36 per pound…[and] breakeven economics for Ironton…40% to 50% operating range…and…for PCP…80% to 90% range.”
• “This effectively provides exclusivity to PureCycle with a license for North America, and…extends the exclusivity period across all of the regions in the world.”

Q&A Highlights

• Unit economics and pricing: Management reaffirmed ~$1.36/lb blended price, lower utilities than initial estimates, and breakeven at ~40–50% utilization at Ironton; company-level breakeven ~80–90% .
• Production vs. sales pacing: Production ramp will be gated by specific application qualifications and working-capital discipline; management wants to produce to targeted compounded specs rather than build generic inventory .
• Liquidity runway: Ended Q4 with ~$15MM unrestricted cash; raised $33MM in Feb; expects to remarket revenue bonds near-term with improved pricing vs prior $0.80 on the dollar .
• Growth projects: Long‑lead equipment purchased for two 130MM‑lb lines; Augusta civil work ongoing; Belgium opportunity progressing; leveraging Ironton data to improve future designs and CapEx per pound .
• Automotive: Successful bumper fascia trials with Washington Penn; ~30MM lbs annual volume potential for one bumper on one model; broadened auto inquiries across interior and fiber applications .

Estimates Context

• S&P Global consensus for Q4 2024 revenue and EPS was not accessible at this time due to data limits; comparisons vs. Street were therefore unavailable. PCT’s 8-K press release emphasized operational updates and commercialization rather than GAAP revenue/EPS disclosure .
• Implication: With estimate comparisons unavailable, investors should focus on operational KPIs (onstream %, feed rates, compounded volumes), commercialization milestones (Drake PO, Churchill launch, P&G approvals), and liquidity/financing cadence until financial statements and Street data can be incorporated .

Key Takeaways for Investors

• Reliability and throughput inflecting: December onstream 67% and a 12.5 klbs/hr record feed rate to date position Ironton closer to nameplate; sustained improvement here is central to de‑risking the story .
• Commercial flywheel starting: First fiber PO (Drake), Churchill retail product launch, and five P&G brand trials with expected Q2 approvals are credible near-term volume catalysts; 29 active and 42 pending trials broaden optionality and mix .
• Pricing power sustained: Management reaffirmed ~$1.36/lb despite virgin volatility, noting a specialty, supply‑constrained market; mix shift toward high‑value compounded applications could support margins .
• Liquidity is a watch item: Q4-end unrestricted cash $15.7MM, offset by a $33MM raise in February and planned ~$118MM bond sales; execution on bond monetization and disciplined WC remain critical .
• Production pacing is deliberate: Management will align production with qualified, application‑specific demand to optimize pricing and WC—expect a stepwise ramp tied to trial approvals and compounding slots .
• Medium‑term growth optionality: Long‑lead equipment for two 130MM‑lb lines, Augusta site work, and Antwerp opportunity suggest a faster scale curve once Ironton commercialization is demonstrably stable .
• Catalysts: third‑party PCR certification by end Q1 (retroactive to ~7.2MM lbs), P&G approvals in early Q2, incremental POs (fiber, packaging, auto), and successful revenue bond sales could drive sentiment and re‑rating .

KPIs (Detail)

• Production and Reliability

• Commercial Pipeline

• Liquidity and Cash Use

Segment/End-Market Notes

• Fiber: First PO from Drake; compounded ~4MM lbs in Q4; >99% resin purity cited; accelerating interest across fiber markets .
• Packaging (rigid/film): Rigid packaging trials with large CPGs and a top converter could unlock >200MM lbs; film trials progressing on 30% PCT content compounds .
• Automotive: Washington Penn bumper fascia compound success; ~30MM lbs potential for one model’s bumper globally; timing depends on model cycles; further interior/fiber applications in discussion .

Disclosures and Caveats

• Consensus estimates for Q4 2024 (revenue/EPS) via S&P Global were not accessible at the time of analysis; therefore, estimate comparisons are not shown .
• The Q4 2024 8‑K press release emphasized operational progress and commercial updates; GAAP revenue/EPS figures were not provided in the press release content reviewed herein .

References: earnings call transcript and corporate updates .