NET Power (NPWR) Q3 2024 earnings summary

Executive summary

• Advanced La Porte demonstration facility commissioning and equipment validation with Baker Hughes, including major upgrades and staff training for 24/7 testing, initiating phase one of a four-phase program running through 2026.

• Project Permian progressed with key supplier selections, including Air Liquide as air separation supplier, purchase orders for long-lead items, and a signed $90 million LNTP with Baker Hughes.

• Identified a large market opportunity in North America, with potential for up to 2,000 plants in competitive markets, focusing on areas with CO2 storage and infrastructure.

• Project Permian remains on track for initial power generation between late 2027 and early 2028.

• Continued prudent capital deployment, maintaining strong liquidity and supporting ongoing project development.

Financial highlights

• Ended Q3 2024 with approximately $580 million in cash and investments, down from $609 million in Q2 2024.

• Q3 cash flow use in operations was about $8 million, including a $5 million payment under the Baker Hughes JDA.

• Total Q3 capital expenditures were $22 million, mainly for La Porte upgrades and Project Permian development.

• Revenue for Q3 2024 was $12, up from $0 in Q3 2023; revenue for the nine months ended September 30, 2024 was $250.

• Net income attributable to NET Power Inc. for Q3 2024 was $818, compared to a net loss of $30,564 in Q3 2023.

Outlook and guidance

• Expect continued inflation in capital equipment and construction costs for Project Permian, above the previous $1.1 billion guidance, but anticipate offset from improved market pricing for clean power.

• FEED for Project Permian with Zachry Group to conclude in Q4 2024, with detailed cost and schedule estimates.

• Construction for Project Permian targeted to begin in the second half of 2025.

• Management believes current liquidity is sufficient for the next 12 months but additional funding will be required for full-scale commercialization.

• Ongoing site feasibility and origination efforts for gigawatt-scale deployments and hybrid applications in deregulated power markets.