hlg-20230331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ______________

Commission File Number: 001-40209

Heliogen, Inc.

(Exact name of registrant as specified in its charter)


Delaware			85-4204953
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
130 West Union Street, Pasadena, California			91103
(Address of Principal Executive Offices)			(Zip Code)

Registrant's telephone number, including area code: (626) 720-4530

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, $0.0001 par value per share

HLGN

New York Stock Exchange

Warrants, each whole warrant exercisable for shares of Common stock at an exercise price of $11.50 per share

HLGN.W

New York Stock Exchange

Preferred Share Purchase Rights

N/A

New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	x	Smaller reporting company	x
		Emerging growth company	x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

As of May 5, 2023, the registrant had 196,847,953 shares of common stock, par value $0.0001 per share outstanding.

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			Page
Cautionary Note Regarding Forward-Looking Statements			3
Part I - Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets			5
Consolidated Statements of Operations			6
Consolidated Statements of Comprehensive Loss			7
Consolidated Statements of S h a r e holders’ Equity			8
Consolidated Statements of Cash Flows			9
Notes to Unaudited Consolidated Financial Statements			11
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			23
Item 3. Quantitative and Qualitative Disclosures About Market Risk			28
Item 4. Controls and Procedures			28
Part II - Other Information
Item 1. Legal Proceedings			30
Item 1A. Risk Factors			30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			30
Item 3. Defaults Upon Senior Securities			30
Item 4. Mine Safety Disclosures			30
Item 5. Other Information			30
Item 6. Exhibits			31
Signatures			32

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Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this Quarterly Report regarding our future financial performance, as well as our strategy, future operations, financial position, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. Any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” or the negative of such terms or other similar expressions. These forward-looking statements are based on management’s current expectations, assumptions, hopes, beliefs, intentions and strategies regarding future events and are based on currently available information as to the outcome and timing of future events. Although we believe such expectations and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management’s assumptions about future events may prove to be inaccurate. All readers are cautioned that the forward-looking statements contained in this Quarterly Report are not guarantees of future performance and we cannot assure any reader that such statements will be realized or that the forward-looking events and circumstances will occur.

As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

•our financial and business performance, including risk of uncertainty in our financial projections and business metrics and any underlying assumptions thereunder;

•changes in our business and strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans;

•our ability to execute our business model, including market acceptance of our planned products and services and achieving sufficient production volumes at acceptable quality levels and prices;

•our ability to maintain listing on the New York Stock Exchange (“NYSE”);

•changes in domestic and foreign business, market, financial, political, legal conditions and applicable laws and regulations;

•our ability to grow market share in our existing markets or new markets we may enter;

•our ability to achieve and maintain profitability in the future;

•our ability to access sources of capital to finance operations, growth and future capital requirements;

•our ability to maintain and enhance our products and brand, and to attract and retain customers;

•our ability to find new partners for product offerings;

•the success of strategic relationships with third parties;

•our ability to scale in a cost-effective manner;

•developments and projections relating to our competitors and industry;

•supply chain disruptions;

•our ability to protect our intellectual property (“IP”);

•the actions of stockholders and the related impact on the price of our common stock;

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•expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), as amended;

•our ability to find and retain critical employee talent and key personnel;

•our ability to successfully manage the transition process to a new Chief Executive Officer;

•the possibility that we may be adversely impacted by other economic, business, and/or competitive factors;

•future exchange and interest rates;

•the outcome of any known and unknown litigation and regulatory proceedings; and

•other risks and uncertainties, including those disclosed under “Item 1A. Risk Factors” in this Quarterly Report or under “Item 1A. Risk Factors” contained in Part I of our Annual Report on Form 10-K for the year ended December 31, 2022 (our “Annual Report”) filed with the Securities and Exchange Commission (“SEC”) on March 29, 2023, and the risk factors and other cautionary statements contained in other filings that have been made or will be made with the SEC by the Company.

Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. Should one or more of the risks or uncertainties described in this Quarterly Report, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Additional information concerning these and other factors that may impact the operations and projections discussed herein may be disclosed under “Item 1A. Risk Factors” contained in Part I of our Annual Report and in our periodic filings with the SEC. Our SEC filings are available publicly on the SEC’s website at www.sec.gov.

You should read this Quarterly Report with the understanding that our actual future results, levels of activity and performance as well as other events and circumstances may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

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Part I - Financial Information

Item 1. Financial Statements

Heliogen, Inc.

Consolidated Balance Sheets

($ in thousands, except share data)

(Unaudited)


	March 31, 2023		December 31, 2022
ASSETS
Cash and cash equivalents	$	39,215	$	45,719
Short-term restricted cash	528		655
Investments, available-for-sale	80,700		97,504

Receivables	10,646		9,195
Inventories	2,900		2,442
Prepaid and other current assets	5,092		3,306
Total current assets	139,081		158,821
Operating lease right-of-use assets	14,373		14,772
Property, plant and equipment, net	6,777		7,071
Goodwill and intangible assets, net	135		1,160
Long-term restricted cash	1,500		1,500
Other long-term assets	8,104		8,295
Total assets	$	169,970	$	191,619
LIABILITIES AND SHAREHOLDERS’ EQUITY
Trade payables	$	3,285	$	6,921
Contract liabilities	10,966		10,348
Contract loss provisions	28,360		28,418

Accrued expenses and other current liabilities	5,945		5,602
Total current liabilities	48,556		51,289


Operating lease liabilities, non-current	13,483		13,921
Warrant liabilities	338		642
Other long-term liabilities	1,565		443
Total liabilities	63,942		66,295
Commitments and contingencies (Note 13)

Shareholders’ equity
Preferred stock, $0.0001 par value; 10,000,000 shares authorized and no shares outstanding as of March 31, 2023 and December 31, 2022	—		—
Common stock, $0.0001 par value; 500,000,000 shares authorized and 195,732,947 shares issued and outstanding (excluding restricted shares of 50,331) as of March 31, 2023; 192,924,429 shares issued and outstanding (excluding restricted shares of 59,770) as of December 31, 2022	19		19
Additional paid-in capital	425,590		434,478
Accumulated other comprehensive loss	(457)		(593)
Accumulated deficit	(319,124)		(308,580)
Total shareholders’ equity	106,028		125,324
Total liabilities and shareholders’ equity	$	169,970	$	191,619

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Heliogen, Inc.

Consolidated Statements of Operations

($ in thousands, except per share and share data)

(Unaudited)


	Three Months Ended
	March 31,
		2023		2022
Revenue:
Services revenue		$	866	$	2,044
Grant revenue		1,071		1,495
Total revenue		1,937		3,539
Cost of revenue:
Cost of services revenue (including depreciation)		941		2,592
Cost of grant revenue		1,071		1,495

Provision for contract losses		370		33,737
Total cost of revenue		2,382		37,824
Gross loss		(445)		(34,285)

Operating expenses:
Selling, general and administrative		4,165		20,062
Research and development		5,260		9,375

Impairment charges		1,008		—
Total operating expenses		10,433		29,437
Operating loss		(10,878)		(63,722)

Interest income, net		283		194

Gain on warrant remeasurement		304		4,026
Other expense, net		(253)		(76)
Net loss before taxes		(10,544)		(59,578)
Benefit for income taxes		—		610
Net loss		$	(10,544)	$	(58,968)





Loss per share:
Loss per share – Basic and Diluted		$	(0.05)	$	(0.32)
Weighted average number of shares outstanding – Basic and Diluted		196,899,292		184,031,015

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Heliogen, Inc.

Consolidated Statements of Comprehensive Loss

($ in thousands)

(Unaudited)


	Three Months Ended
	March 31,
		2023		2022
Net loss		$	(10,544)	$	(58,968)
Other comprehensive income (loss), net of taxes:
Unrealized gains (losses) on available-for-sale securities		173		(379)
Cumulative translation adjustment		(37)		(1)
Total other comprehensive income (loss), net of taxes		136		(380)
Comprehensive loss		$	(10,408)	$	(59,348)

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Heliogen, Inc.

Consolidated Statements of Shareholders’ Equity

($ in thousands, except share data)

(Unaudited)


	Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Loss		Accumulated Deficit		Total
		Shares			Amount
Balance as of December 31, 2022		192,924,429	$	19		$	434,478	$	(593)	$	(308,580)	$	125,324
Net loss		—	—			—		—		(10,544)		(10,544)
Other comprehensive income		—	—			—		136		—		136
Share-based compensation		—	—			(9,306)		—		—		(9,306)
Restricted stock vestings		1,210,801	—			—		—		—		—
Stock options exercised		1,597,717	—			235		—		—		235



Issuance of warrants in connection with vendor agreements		—	—			107		—		—		107
Issuance of warrants in connection with customer agreements		—	—			76		—		—		76

Balance as of March 31, 2023		195,732,947	$	19		$	425,590	$	(457)	$	(319,124)	$	106,028


	Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Loss		Accumulated Deficit		Total
		Shares			Amount
Balance as of December 31, 2021		183,367,037	$	18		$	380,624	$	(4)	$	(166,580)	$	214,058
Net loss		—	—			—		—		(58,968)		(58,968)
Other comprehensive loss		—	—			—		(380)		—		(380)
Share-based compensation		—	—			12,982		—		—		12,982

Stock options exercised		2,754,244	1			271		—		—		272




Issuance of warrants in connection with customer agreements		—	—			9,339		—		—		9,339
Balance as of March 31, 2022		186,121,281	$	19		$	403,216	$	(384)	$	(225,548)	$	177,303

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Heliogen, Inc.

Consolidated Statements of Cash Flows

($ in thousands)

(Unaudited)


	Three Months Ended
	March 31,
	2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(10,544)	$	(58,968)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	601		760
Impairment charges	1,008		—
Share-based compensation	(9,306)		12,982

Change in fair value of warrants	(304)		(4,026)
Change in fair value of contingent consideration	1,125		14
Deferred income taxes	—		(611)
Non-cash operating lease expense	400		428
Other non-cash operating activities	(570)		101
Changes in assets and liabilities:
Receivables	(1,497)		(9,693)
Inventories	(458)		—
Prepaid and other current assets	(1,786)		(3,802)

Trade payables and accrued liabilities	(3,084)		456
Contract liabilities	705		6,811
Provision for contract losses, net	(77)		33,766


Other non-current assets and liabilities	(345)		(891)
Net cash used in operating activities	(24,132)		(22,673)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(527)		(1,360)
Purchases of available-for-sale securities	(44,520)		(122,468)
Maturities of available-for-sale securities	62,300		21,100



Net cash provided by (used in) investing activities	17,253		(102,728)
CASH FLOWS FROM FINANCING ACTIVITIES:



Proceeds from exercise of stock options	248		209

Other financing costs	—		(1,274)
Net cash provided by (used in) financing activities	248		(1,065)
Decrease in cash, cash equivalents and restricted cash	(6,631)		(126,466)
Cash, cash equivalents and restricted cash at the beginning of the period	47,874		191,581
Cash, cash equivalents and restricted cash at the end of the period	$	41,243	$	65,115

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Heliogen, Inc.

Consolidated Statements of Cash Flows (continued)

($ in thousands)

(Unaudited)


	Three Months Ended
	March 31,
	2023		2022
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents	$	39,215	$	63,615
Short-term restricted cash	528		—
Long-term restricted cash	1,500		1,500
Total cash, cash equivalents and restricted cash	$	41,243	$	65,115




Non-cash investing and financing activities:


Fair value of Project Warrants and Collaboration Warrants recognized in equity	$	76	$	9,339
Capital expenditures incurred but not yet paid	$

SEC Form 10-Q filed by Heliogen Inc.