# Westwater Resources, Inc.: Form 10-Q for the period ended Mar 31, 2025 - Company: [Westwater Resources, Inc.](/companies/wwr.md) (CIK 839470) - Form: 10-Q - Filed: 2025-05-14 - Accepted by EDGAR: May 14, 2025, 16:30 ET - Period: 2025-03-31 - Accession: 0001558370-25-007769 - Inline XBRL: yes - Main document: https://www.sec.gov/Archives/edgar/data/839470/000155837025007769/wwr-20250331x10q.htm - All documents and exhibits: https://www.sec.gov/Archives/edgar/data/839470/000155837025007769/ ## Figures reported in this filing Standardized XBRL line items for the period ended 2025-03-31. | Line item | Period | Value | XBRL concept | | --- | --- | ---: | --- | | Research and development | 3 months, 2025-01-01 to 2025-03-31 | $182.0k | us-gaap:ResearchAndDevelopmentExpense | | Net income | 3 months, 2025-01-01 to 2025-03-31 | −$2.7m | us-gaap:NetIncomeLoss | | Diluted EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.04 | us-gaap:EarningsPerShareDiluted | | Basic EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.04 | us-gaap:EarningsPerShareBasic | | Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 67,919,882 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding | | Operating cash flow | 3 months, 2025-01-01 to 2025-03-31 | −$2.3m | us-gaap:NetCashProvidedByUsedInOperatingActivities | | Capital expenditure | 3 months, 2025-01-01 to 2025-03-31 | $2.9m | us-gaap:PaymentsToAcquireProductiveAssets | | Cash and equivalents | at 2025-03-31 | $3.3m | us-gaap:CashAndCashEquivalentsAtCarryingValue | | Current assets | at 2025-03-31 | $4.2m | us-gaap:AssetsCurrent | | Total assets | at 2025-03-31 | $147.4m | us-gaap:Assets | | Current liabilities | at 2025-03-31 | $11.1m | us-gaap:LiabilitiesCurrent | | Total liabilities | at 2025-03-31 | $12.6m | us-gaap:Liabilities | | Shareholders' equity | at 2025-03-31 | $134.9m | us-gaap:StockholdersEquity | ## Management's discussion and analysis As filed, 25,726 characters. The following management’s discussion and analysis of the consolidated financial results and financial condition of Westwater for the three months ended March 31, 2025, has been prepared based on information available to us as of May 14, 2025. This discussion should be read in conjunction with the unaudited Interim Financial Statements and Notes thereto included herewith and the audited consolidated financial statements of Westwater for the period ended December 31, 2024, and the related notes thereto included in our Annual Report, which were prepared in accordance with U.S. GAAP. This management’s discussion and analysis contains forward-looking statements that are subject to risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including, but not limited to, those set forth elsewhere in this report. See “Cautionary Note Regarding Forward-Looking Statements” herein. ### INTRODUCTION Westwater Resources, Inc., originally incorporated in 1977, is an energy technology company focused on developing battery-grade natural graphite materials through its two primary projects, the Kellyton Graphite Plant and the Coosa Graphite Deposit, both located in Coosa County, Alabama. Once operational, Westwater expects the Kellyton Graphite Plant to process natural flake graphite and, based on current studies and estimates, produce 12,500 metric tons (“mt”) per year of CSPG in Phase I of the Kellyton Graphite Plant, primarily for use in lithium-ion batteries. Westwater also holds mineral rights to explore and potentially mine the Coosa Graphite Deposit, which Westwater anticipates will eventually provide natural graphite flake concentrate to the Kellyton Graphite Plant. ### RECENT DEVELOPMENTS ### Customer Engagement Update The global landscape for the U.S. supply of critical materials like natural graphite continues to evolve. One of the key benefits of moving to a domestic supply source for battery grade natural graphite – security of supply – appears to be resonating with U.S. cell makers and electric vehicle OEMs. Westwater is responding to outreaches from these companies as they weigh the impact of potential changes to global tariffs and the Inflation Reduction Act along with new announcements declaring the importance of U.S.-based critical material supply chains. As previously announced, the Company has secured offtake agreements for 100% of its anticipated Phase I production capacity and partially committed a portion of anticipated Phase II production capacity from its Kellyton Graphite Plant. Westwater is experiencing increased customer interest in Phase II production, which we believe is the result of tariff uncertainty and a desire to secure domestic supply of CSPG. Westwater continues to engage with current and other potential customers by providing samples of CSPG produced by the Company for testing and evaluation, hosting site tours of the Kellyton Graphite Plant, and having technical product development and commercial discussions. Feedback from certain potential customers indicates that Westwater’s material meets their initial specifications, and has resulted in the Company providing additional, or in some cases, larger product samples to these potential customers. ### Kellyton Graphite Plant – Construction and Estimated Cost Update Total expected costs for Phase I of the Kellyton Graphite Plant remain at $245 million. During the first quarter of 2025, construction activities at the Kellyton Graphite Plant consisted of receipt of additional long-lead equipment components and installing equipment and structural steel. As of the end of the first quarter of 2025, we have received approximately 85% of the Phase I equipment, installed all micronization (sizing) and spheroidization (shaping) mills in the SG building and completed the structural steel work. In addition, we continue to install peripheral support equipment surrounding the micronization and spheroidization mills in the SG building. Westwater has constructed and continues to operate its R&D Lab. The R&D Lab allows Westwater to continue product development and optimization with potential customers, and to perform additional quality control tests. It also affords greater flexibility to optimize future samples in accordance with customer specifications. Since inception of the project, and inclusive of liabilities as of March 31, 2025, the Company has incurred costs of approximately $124.1 million. While the Company has continued construction activities related to Phase I of the Kellyton Graphite Plant during the first quarter of 2025, Westwater has reduced the level of construction activity from anticipated levels, including adjusting the timing of future work, until receipt of the additional funding needed to complete construction of Phase I of the Kellyton Graphite Plant. Reducing the level of construction activity until financing is secured is expected to impact the overall schedule to complete Phase I of the Kellyton Graphite Plant. The Company expects to provide an update on construction timing once, and if, the additional funding is secured. ### Qualification Line Development at Kellyton Graphite Plant During the quarter ended March 31, 2025, Westwater operated its qualification line at the Kellyton Graphite Plant. During the quarter, we produced and completed over an 800 kg sample of CSPG for one of our cellmaker customers for pre-production cell trials and testing. Samples produced on the qualification line will be representative of CSPG mass production. The Company expects that the operation of the qualification line will allow Westwater to supply its customers bulk samples of CSPG in 1 to 10 mt batches for cell qualification activities while the Company completes the construction of Phase I of the Kellyton Graphite Plant. The line will also be used to train Westwater’s operations team which the Company expects will expedite the commissioning and startup of the Kellyton Graphite Plant. ### Debt Financing Update As previously announced, the Company is working to complete the syndication of a secured debt facility for approximately $150 million to finance the completion of construction of Phase I of the Kellyton Graphite Plant. During 2024, the Company executed a term sheet and received investment committee approval from the lead lender (a global financial institution), and since then we have been working with our investment banker to complete the syndication of the loan. Beginning in February, tariffs announced by the U.S. federal government, EU, Canada, Mexico, and China have created concerns regarding domestic EV adoption rates, and general market uncertainty in the capital markets. Recent protests at the location of our feedstock supplier have also impacted the syndication process. While our feedstock supplier has announced resolution of the protests and expects to be back in operations in the near term, Westwater is at an advanced stage in securing a backup feedstock supplier. During the first quarter, Westwater continued the process of syndicating the loan, which included advancing loan documentation, advancing the technical readiness level of Phase I, updating technical due diligence using an independent third-party engineering firm, responding to diligence requests from multiple lenders interested in joining the syndication, hosting interested lenders at the Kellyton Graphite Plant site in Alabama, and advancing the identification and selection of a backup feedstock supplier. The progression from signing the term sheet to loan closing is subject to customary agreement on completing the syndication, final due diligence and investment committee approval by other potential lenders in the syndication, and final loan conditions and terms. No assurance can be given that the Company will ultimately enter into the secured debt facility, or that financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. In April, Westwater received a letter of interest from Export-Import Bank of the United States (“EXIM”) for its Kellyton Graphite Plant, under the “Make More in America Initiative” and the “China and Transformational Exports Program.” The letter of interest is separate from the Phase I debt syndication process discussed above and could be an additional source of funding. The progression from a letter of interest to a loan commitment from EXIM requires a formal application, and for EXIM to complete due diligence, underwriting and finalization of terms and conditions. No assurance can be given that the Company will ultimately enter into a loan transaction with EXIM. Management remains focused on completing the debt facility and will continue to update investors as appropriate. ### Coosa Graphite Deposit Through its wholly owned subsidiary, Alabama Graphite, Westwater holds mineral rights across 41,965 acres of the Alabama graphite belt in Coosa County, Alabama. During the fourth quarter of 2023, Westwater completed an IA, with an economic analysis for the Coosa Graphite Deposit. The IA was completed as a Technical Report Summary (“TRS”) disclosing Mineral Resources, including an economic analysis, for the Coosa Graphite Deposit, in accordance with S-K 1300. The TRS was completed on behalf of Westwater by SLR International Corporation (“SLR”) with an effective date of December 11, 2023, and filed with the SEC on Form 8-K/A on October 9, 2024. For further information regarding the IA and the Coosa Graphite Deposit, refer to Item 2, Properties, in the Annual Report and the aforementioned Form 8-K/A. Westwater commenced a strategic financing review process for the Coosa Graphite Deposit in the first quarter of 2024. This strategic financing review process seeks to identify investment sources and partners for the Coosa Graphite Deposit, and may include review of strategic investment partners or other strategic transactions. ### Graphite and Vanadium as Critical Materials Presently, the United States is almost 100% dependent on imports for battery-grade graphite, which is currently the primary anode material in the lithium-ion batteries that power electric vehicles, smartphones, and laptops, and store power generated from intermittent renewable energy sources. Westwater intends to process natural flake graphite into battery-grade graphite, primarily for lithium-ion batteries. The U.S. currently relies on imports of at least 15 critical minerals, including graphite which is currently supplied almost entirely by companies located in China. The new executive order effective March 20, 2025, names the Defense Production Act and the U.S. International Development Finance Corporation as mechanisms for supporting an effort to provide financing, loans and other investment support to domestically process critical minerals. Approximately 77% of the global natural flake graphite and approximately 97% of global anode active material is supplied by China (Mining Technology, 2024), which causes China to pose a geopolitical risk, particularly to the EU and U.S. regions. China and the United States have imposed tariffs and export controls on critical minerals, including graphite, indicating the potential for further trade barriers between China and the United States. During April 2025, there was an executive order signed that imposes an additional ad valorem duty on all imports from all trading partners. Evident by the executive orders signed during 2025, while subject to continuing uncertainty, import tariffs on battery natural graphite produced anywhere outside the U.S. are likely to persist. In addition, tariffs are also now in place on CSPG shipped from other countries including Indonesia, South Korea and Japan. Westwater believes these tariffs and export restrictions continue to highlight the supply-chain risk for the U.S. and other countries related to natural graphite products and could provide an opportunity for Westwater. Westwater has developed graphite-purification technology and advanced product-development processes designed to meet the demands of potential customers for battery-grade graphite materials. Westwater is developing methodologies and constructing facilities intended to produce high purity, battery-grade graphite products at its Kellyton Graphite Plant. These products are being designed to serve all major battery sectors. In addition, we believe the processes we intend to use are environmentally sustainable and permittable in the United States, where a robust regulatory environment complements our core values to reliably deliver safe, well-made products to our customers. Westwater has and will continue to support the efforts by the relevant United States governmental agencies, the State of Alabama and local municipalities to ensure that they remain aware of the importance of natural battery-grade graphite, its importance to the nation’s security, and how the Kellyton Graphite Plant and the Coosa Graphite Deposit fit into the critical minerals-equation. ### Equity Financings #### Capital Raises during the three months ended March 31, 2025 During the three months ended March 31, 2025, the Company sold 2.5 million shares of Common Stock for net proceeds of $2.0 million, pursuant to the ATM Sales Agreement, and sold 3.8 million shares of Common Stock for net proceeds of $2.6 million, pursuant to the 2024 Lincoln Park PA. See *Note 7* to the Interim Financial Statements for additional information. ### RESULTS OF OPERATIONS ### Summary Our net loss for the three months ended March 31, 2025, was $2.7 million, or $0.04 per share, as compared with a net loss of $2.9 million, or $0.05 per share for the same period in 2024. The $0.2 million decrease in our net loss was primarily due to lower general and administrative costs. ### Product Development Expenses Product development expenses for the three months ended March 31, 2025, were $0.2 million, a decrease of $0.1 million compared to the same period in 2024. Product development expenses for the three months ended March 31, 2025 and 2024, related primarily to sample production of battery-grade natural graphite products for evaluation by current and potential customers. ### Exploration Expenses Exploration expenses for the three months ended March 31, 2025, remained essentially flat compared to the same period in 2024. ### General and Administrative Expenses General and administrative expenses for the three months ended March 31, 2025, decreased by $0.3 million compared to the same period in 2024, primarily due to lower personnel costs as well as cost saving initiatives while working to complete the syndication of a loan to fund the remaining construction of Phase I of the Kellyton Graphite Plant. ### Other (Expense) Income, net Other expense, net for the three months ended March 31, 2025, was less than $0.1 million, compared to other income, net of $0.1 million for the same period in 2024. The change in other (expense) income, net is due to a lower average cash balance resulting in less interest income earned in the current period. ### FINANCIAL POSITION ### Operating Activities Net cash used in operating activities of $2.3 million for the three months ended March 31, 2025, represents a decrease of $0.5 million compared to the same period in 2024. The decrease in cash used in operating activities was primarily due to approximately $0.3 million less general and administrative and approximately $0.1 million product development costs, offset slightly by approximately $0.1 million less interest income in 2025 compared to 2024. The remaining decrease in operating cash flow was due to other changes in working capital. ### Investing Activities Net cash used in investing activities increased by $0.4 million for the three months ended March 31, 2025, as compared to the same period in 2024. For both periods, the investing activity represents construction capital expenditures as the Company continues a managed approach to construction activity while seeking debt financing to fund the remaining construction of Phase I of the Kellyton Graphite Plant. ### Financing Activities Net cash provided by financing activities increased by $3.7 million for the three months ended March 31, 2025, as compared to the same period in 2024. The increase was due to an increase in shares of Common Stock sold under the ATM Sales Agreement and 2024 Lincoln Park PA during the three months ended March 31, 2025, compared to the same period in 2024. ### LIQUIDITY AND CAPITAL RESOURCES Since 2009, the Company has not recorded revenue from operations and, as of March 31, 2025, current liabilities exceeded current assets. As such, Westwater is subject to the risks associated with development stage companies. Management expects to continue to incur cash losses as a result of construction activity at the Kellyton Graphite Plant and general and administrative expenses until operations commence at the Kellyton Graphite Plant. If financing is not available to fund the construction of Phase I of the Kellyton Graphite Plant through the equity and debt capital markets or alternative financing sources, the Company may be required to reduce or severely curtail operations, change its planned business development strategies related to the Coosa Graphite Deposit and Phase I of the Kellyton Graphite Plant, alter the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant, put the construction of Phase I of the Kellyton Graphite Plant on hold until additional funding is obtained, or seek strategic alternatives. If the Company is required to abandon construction and development or alter its intended long-term plans related to the Kellyton Graphite Plant, the Company could be required to evaluate the recoverability of its long-lived assets. The Company has relied on equity financings, debt financings and asset sales to fund its operations. During the three months ended March 31, 2025, and through the date that the Interim Financial Statement were issued, the Company continued construction activities related to the Kellyton Graphite Plant. However, those construction activities have been significantly reduced from anticipated levels until the additional funding needed to complete Phase I of the Kellyton Graphite Plant is in place. The Company’s construction-related contracts include termination provisions at the Company’s election that do not obligate the Company to make payments beyond what is incurred by the third-party service provider through the date of such termination. In its going concern analysis, the Company considered construction activity and related costs through the date that the Interim Financial Statements are issued. Based on this analysis and excluding potential external funding opportunities and the Company’s current equity facility, the Company’s planned non-discretionary expenditures for one year past the issue date of these Interim Financial Statements exceed the cash on hand as of the date of these Interim Financial Statements. See *Note 2* to the Interim Financial Statements for additional information. On March 31, 2025, the Company’s cash balance was approximately $3.3 million. During the three months ended March 31, 2025, the Company sold 2.5 million shares of Common Stock for net proceeds of $2.0 million pursuant the ATM Sales Agreement with H.C. Wainwright and sold approximately 3.8 million shares of Common Stock for net proceeds of $2.6 million pursuant to the 2024 Lincoln Park PA. As of March 31, 2025, the Company has approximately $49.9 million remaining available for future sales under the ATM Sales Agreement, and 6.2 million shares of Common Stock (inclusive of 0.5 million of Additional Commitment Shares) available for future sales pursuant to the 2024 Lincoln Park PA. While the Company has advanced its business plan and has been successful in the past raising funds through equity financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Recent volatility in the equity and debt capital markets, higher interest rates, inflation, electric vehicle production and adoption rates, generally uncertain economic conditions and regulatory policy and enforcement, and unstable geopolitical conditions, including tariffs, could significantly impact the Company’s ability to access the necessary funding to advance its business plan. The Company’s ability to raise additional funds under the ATM Sales Agreement may be limited by the Company’s market capitalization, share price and trading volume. ### OFF-BALANCE SHEET ARRANGEMENTS We have no off-balance sheet arrangements. ### CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS With the exception of historical matters, the matters discussed in this report are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projections or estimates contained herein. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding the adequacy of funding, liquidity, access to capital, financing activities, the timing or occurrence of any future drilling or production from the Company’s properties, economic conditions, the strategic goals of the business, costs of any phase of development or operational line at the Kellyton Graphite Plant and estimated construction and commissioning timelines and completion dates, the start date for the mining of the Coosa Graphite Deposit, and the Company’s anticipated cash burn rate and capital requirements. Words such as “may,” “could,” “should,” “would,” “believe,” “estimate,” “expect,” “anticipate,” “plan,” “forecast,” “potential,” “intend,” “continue,” “project,” “target” and variations of these words, comparable words and similar expressions generally indicate forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements. Actual results may differ materially from those expressed or implied by these forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, among others: - the spot price and long-term contract price of graphite (both flake graphite feedstock and purified graphite products) and vanadium, and the world-wide supply and demand of graphite and vanadium; - the effects, extent and timing of the entry of additional competition in the markets in which we operate; - our ability to obtain or maintain contracts or other agreements with customers; - available sources and transportation of graphite feedstock; - the ability to control costs and avoid cost and schedule overruns during the development, construction and operation of the Kellyton Graphite Plant; - the ability to construct and operate the Kellyton Graphite Plant in accordance with the requirements of permits and licenses and the requirements of tax credits and other incentives; - the effects of inflation, including labor shortages and supply chain disruptions; - rising interest rates and the associated impact on the availability and cost of financing sources; - uncertainty in debt and equity capital markets and the associated impact on the availability and cost of financing sources; - the availability and supply of equipment and materials needed to construct the Kellyton Graphite Plant; - stock price volatility; - changes in the U.S. administration or government regulation of the mining and manufacturing industries in the U.S.; - unanticipated geopolitical, geological, processing, regulatory and legal or other problems we may encounter; - the results of our exploration activities, and the possibility that future exploration results may be materially less promising than initial exploration results; - any graphite or vanadium discoveries not being in high enough concentration to make it economic to extract the minerals; - our ability to finance growth plans; - our ability to obtain and maintain rights of ownership or access to our mining properties; - currently pending or new litigation or arbitration; - recent changes in legislation, regulations and economic conditions regarding tariffs, the implementation of the new U.S. Department of Governmental Efficiency (“DOGE”) and related DOGE budget and spending cuts and the potential that this affects the demand for our products or our cost or ability to produce or sell them; - the potential impact that new foreign country tariffs may have on our construction costs or ability to (i) source and procure necessary raw materials for the manufacture and provision of our products and services; and (ii) sell and to deliver our products to such foreign countries; and - our ability to maintain and timely receive mining, manufacturing, and other permits from regulatory agencies. In addition, other factors are described in our Annual Report, and the other reports we file with the SEC. Most of these factors are beyond our ability to predict or control. Future events and actual results could differ materially from those set forth herein, contemplated by or underlying the forward-looking statements. Forward-looking statements speak only as of the date on which they are made. We disclaim any obligation to update any forward-looking statements made herein, except as required by law. ## Controls and procedures As filed, 1,769 characters. ### Evaluation of Disclosure Controls and Procedures The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its filings with the SEC is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management has recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply judgment in evaluating the Company’s controls and procedures. During the fiscal period covered by this report, the Company’s management, with the participation of the Chief Executive Officer and Chief Financial Officer of the Company, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2025. ### Changes in Internal Controls There were no changes in our internal control over financial reporting during the three months ended March 31, 2025, that materially affected, or are reasonably likely to materially affect our internal control over financial reporting. ## Risk factors As filed, 214 characters. An investment in our Common Stock involves various risks. When considering an investment in us, careful consideration should be given to the risk factors discussed in *Risk Factors in Item 1A* in our Annual Report. Filed May 14, 2025. Source: SEC EDGAR, the filing index for accession 0001558370-25-007769. Last ingested by Listed: Oct 24, 2026, 14:58 ET. No prices; not investment advice.