Westwater’s Q3 Loss Narrows to $4.4 Million as Westwater Seeks Kellyton Funding

Westwater Resources, Inc. narrowed its third-quarter net loss to $4.4 million as it continued seeking financing for Phase I of its Kellyton Graphite Plant in Alabama. The company announced its results Nov. 12, reporting a smaller loss than a year earlier even as it pursued funding to complete construction.

The loss was $9.8 million in the year-earlier quarter. Loss per share was $0.03, compared with $0.12. A lower expense related to fair-value changes and conversions of convertible notes was the main reason the loss narrowed, partly offset by higher Coosa permitting, consulting and outside-services costs. The company had not begun generating revenue from its graphite business.

Westwater had $29.2 million in cash on Sept. 30. It estimated Phase I would cost $245 million, with about $109 million remaining to be spent; that figure includes roughly $14.8 million for contingency and potential cost escalation. Management believes available cash can cover working capital and planned non-discretionary capital spending for more than a year after the financial statements were issued. That cash outlook does not cover the remaining plant construction.

The Export-Import Bank of the United States approved an approximately $25 million direct loan for the project in August. The loan remains subject to final documents and customary closing conditions, and Westwater is not assured of entering into it.

Under a Nov. 10 agreement, Lincoln Park Capital Fund, LLC committed to buy up to $50 million of Westwater shares, subject to the agreement’s conditions and limitations. Westwater may sell shares under the arrangement but is not required to do so. No sales had begun as of the filing.