Origin Materials Reorganizing, Laying Off 28% of Staff

Dow Jones09-23

By Chris Wack

Origin Materials said it was reorganizing its business and laying off more than a quarter of its workers to reduce cash burn and accelerate its timeline to profitability.

The maker of tethered bottle caps and other sustainable packaging said it planned to operate Origin 1, its biomass-conversion plant in Sarnia, Ontario, 'on demand' with reduced staffing, while preserving its ability to generate enough product to explore scaling up with strategic partners.

The West Sacramento, Calif., company said the product already generated at Origin 1 and materials it may buy from third-parties should enable it to cut its cash burn. This move, plus the reduction of certain expenses related to longer-term research-and-development projects, prompted the company to cut 28% of its workforce.

Origin expects to incur $600,000 in restructuring charges in connection with the layoffs, consisting of cash expenditures of $500,000 and non-cash expenses of $100,000.

Origin is maintaining its 2024 guidance for revenue of $25 million to $35 million, and net cash burn between $55 million and $65 million. Analysts polled by FactSet are looking for 2024 revenue of $31.2 million.

The company said it was on track to start its first commercial-scale production of PET caps later this year, with a ramp up in caps revenue to begin in the first quarter of 2025.

Write to Chris Wack at chris.wack@wsj.com

(END) Dow Jones Newswires

September 23, 2024 07:39 ET (11:39 GMT)

Copyright (c) 2024 Dow Jones & Company, Inc.

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