AUSTRALIAN-based EV fast-charger manufacturing company Tritium has said it will close its Brisbane factory and consolidate its operations in the US.

Tritium chief executive Jane Hunter told The Australian Financial Review earlier this month that the closure of the Brisbane factory was an option as it searched for a new strategic investor. It has now become reality and is likely to lead to the loss of about 200 jobs.

Ms Hunter said in a statement that it was necessary to close the factory and cut costs in a bid “to be profitable in 2024.”

“The implementation of this plan, including the closure of the Brisbane factory and consolidating our manufacturing operations in Tennessee, supports the ongoing market competitiveness and positioning of the company as a world leader in its category.”

Tritium said it would keep its research and development team and testing facilities in Brisbane.

The company had been asking for financial aid from state and federal governments to maintain production and keep its listing on the Nasdaq board in the US. Tritium opened a plant in Tennessee last year.

In an interview with the AFR, Tritium’s majority shareholder and non-executive director Trevor St Baker criticised the lack of support from multibillion-dollar super funds in Australia for an Australian business as it expands overseas with “world-leading” technology.

“These institutions are simply not structured to allow them to even consider such investments,” he said, adding that there had been no Australian capital available from outside the superannuation industry either, from sources such as the CEFC or QIC.

“In Australia, beyond new-start R&D grants and incentive schemes, the political focus is on critical mineral resources and hydrogen, allowing a sovereign capability in the critical new global EV market to slip away,” he said.

The Nasdaq last month issued Tritium with a “show-cause” notice after its shares spent more than 30 days valued under $US1. They are now US22c and the market capitalisation is $US36.6 million – significantly below the $US2 billion valuation it had on listing on the Nasdax index in 2021.

Tritium’s FY23 report also highlights loans needed to support the company in the year. 

These included, on September 2, 2022, the existing CIGNA Refinance loan 2022 was refinanced and extended by $US60 million to a $US150 million facility (“Facility A”) LNSA with Facility A Lenders. The LNSA has a three-year term and 8.5 per cent cash coupon supplemented with the issuance to the lenders or their affiliates of warrants for the purchase of Ordinary Shares in Tritium. 

“On December 23, 2022, Tritium entered into a secured term loan facility with the Sunset Power Pty Ltd as trustee of St Baker Family Trust, among other parties (the “Term Facility Lender”), under which Tritium Pty Ltd borrowed an aggregate principal amount of $US20 million to fund charger manufacturing obligations under or in connection with specified purchase orders (“Term Loan Facility”),” the report to the Nasdaq said. 

“The outstanding balance of the term loan at June 30, 2023 was $US19.7 million. The term loan accrues interest at a rate of 9.50 per cent per annum.  

“On May 5, 2023, Tritium entered into the Unsecured Facility – Sunset Power, under which Tritium borrowed an aggregate principal amount of $US35 million to fund working capital requirements. 

“The outstanding balance of this unsecured facility as at June 30, 2023 was $US30.5 million. The unsecured facility accrues interest at a rate of 12.0 per cent per annum. 

“On May 5, 2023, Tritium and its subsidiaries entered into the Unsecured Facility – O-CORP, under which Tritium borrowed an aggregate principal amount of $US5.0 million to fund working capital requirements. 

“The outstanding balance of this unsecured facility as at June 30, 2023 was $US4.4 million. The unsecured facility accrues interest at a rate of 12.0 per cent per annum. “ 

Tritium, listed on the US Nasdaq as Tritium DCFC Ltd, recently reported an increase in revenue for the FY23 year to $US184.5 million, up 115 per cent, but a loss of $US120.3 million.

In its FY2023 financial report, Tritium reported that it “continued to expand within the major markets of the US, Europe and Australasia as worldwide revenues grew by 115 per cent compared to 2022.”

“Revenue growth has been directly tied to the charging requirements resulting from the continued adoption of passenger and commercial EVs, which drives demand for charging infrastructure,” it said.

“The market for EVs is still rapidly evolving and, although demand for EVs has grown consistently in recent years and is continuing to grow at an increasing rate, there is no guarantee such demand will persist. 

“Factors impacting the adoption of EVs include, but are not limited to:

• Consumer perceptions about EV features
• Quality, safety and performance
• Availability and cost
• Availability of government-backed incentives to purchase EVs
• Changes to fuel economy standards and/or the success of alternative fuels
• Evolving governmental regulation and political support for EVs
• Volatility in the cost of oil and gasoline
• Consumer perceptions about the limited range over which EVs may be driven on a single battery charge
• Availability of charging stations and services for EVs;
• Consumers’ perception about the convenience and cost of charging EVs
• Global supply chain shortages of components used in EVs
• Increases in fuel efficiency.”

Its financials showed a FY23 loss of the consolidated entity “after providing for income tax amounts to $US120.3 million (2022 loss: $US298.6 million), demonstrating a continuing improvement in the financial performance during the year ended 30 June 2023 as the Company added additional production lines and ramped up production rates in its Tennessee factory.”

“Revenue increased by $US98.7 million, or 115 per cent, from $US85.8 million during the year ended June 30, 2022, to $US184.5 million during year ended June 30, 2023, primarily attributable to an increase in external hardware revenue of $US98.7 million, offset by a decrease in related parties hardware revenue of $US4.4 million and an increase in service and maintenance revenue of $US4.3 million,” it said in its stock market report..

Tritium’s hardware revenue consists of revenue generated from the sale of EV chargers. 

“We have three major product lines: Stand Alone Chargers, Distributed Chargers and Other. Total hardware revenue (external and related party) increased by $US94.3 million, or 117 per cent, from $US80.8 million during the year ended June 30, 2022, to $US175.2 million during the year ended June 30, 2023 due to volume and product offerings.

“The number of Stand Alone Chargers sold increased by 2631, or 131 per cent, from 2006 during the year ended June 30, 2022, to 4637 during the year ended June 30, 2023. 

“The average selling price of Stand Alone Chargers decreased by $US2467, or 10 per cent, from $US25,958 per unit during the year ended June 30, 2022, to $US23,491 per unit during the year ended June 30, 2023. The decrease was due to a higher volume of lower powered versions which sell at a lower price.”

In the same period, Tritium said that sales of Distributed Chargers increased by 1212 total units, or 185 per cent, from 654 total units for the year to 1866 total units including the sale of 666 Power units.

“The increase was due to higher market demand for high powered Distributed Chargers in FY2023. The average selling price of Distributed Chargers decreased by $US7770, or 19 per cent, from $US40,677 during the year to $US32,908 during the year ended June 30, 2023. 

“This was primarily attributable to a change in the mix of configurations between legacy and newer product lines sold in the recent period and the increase in the sale of power units.”