Carbon Revolution receives final $5 million from OIC facility

GEELONG, Australia - Carbon Revolution plc (NASDAQ:CREV), a manufacturer of lightweight carbon fiber wheels for the automotive industry with a market capitalization of $9 million, announced Friday that Orion Infrastructure Capital (OIC) has released the final $5 million from its previously announced $25 million facility. The company’s stock has shown significant momentum recently, gaining 18% in the past week according to InvestingPro data.

The company also received the remaining $400,000 of loan reserves from existing noteholders under its $60 million PIUS loan entered in May 2023, bringing total reserves released to $2 million. InvestingPro analysis indicates the company’s overall financial health score stands at 1.11, rated as ’WEAK’, suggesting continued challenges ahead.

As part of this funding arrangement, Carbon Revolution will issue penny warrants to OIC and existing noteholders for shares equal to 5% of the company’s outstanding shares. Both lenders have agreed to accept partial payment in kind instead of cash for certain interest payments over approximately six months.

Despite having several new programs entering or expected to enter production soon, Carbon Revolution has revised its revenue forecasts downward due to declining wheel order volumes from certain customers. The company has consequently slowed its short-term expansion plans.

The manufacturer indicated it may need additional funding within the next quarter due to lower revenue forecasts and delayed customer payments. Carbon Revolution is in discussions with OIC regarding potential additional funding and exploring other financing options, though it noted there is no guarantee it will secure funding on satisfactory terms.

Carbon Revolution supplies carbon fiber wheels to automotive manufacturers in the high performance, premium and luxury segments. Trading at $4.91, the stock remains 61% below its 52-week high of $12.75, while showing recent signs of recovery. The information is based on a company press release statement and InvestingPro data, which offers additional insights through 8 more exclusive ProTips for subscribers.

In other recent news, Carbon Revolution has encountered multiple compliance issues with Nasdaq. The company received a notification from Nasdaq for failing to submit the required interim financial information for the period ending December 31, 2024. Additionally, Carbon Revolution has been informed of non-compliance concerning its stockholder’s equity, which does not meet the minimum requirement of $10 million for continued listing on the Nasdaq Global Select Market. The company has 45 days from May 30, 2025, to submit a compliance plan to Nasdaq, with the potential to extend the deadline to November 26, 2025, if the plan is accepted.

In a move to strengthen its financial position, Carbon Revolution has secured an additional $27 million in funding. This includes a $5 million tranche from Orion Infrastructure Capital as part of a previously announced $25 million facility and a $400,000 release of loan reserves by existing note holders. The funding aims to enhance the company’s liquidity and support its production capacity for upcoming programs. These developments are part of Carbon Revolution’s ongoing efforts to address its financial and operational challenges.

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