NATURAL GAS FUELING & CONVERSION: American Resources Corporation Reports Second Quarter 2021 Financial Results And Provides Business Outlook

The following excerpt is from the company's SEC filing.

Company aligned with major U.S. priorities in both infrastructure
and electrification

Significant execution over the first half of the year has
positioned the Company to be a low-cost, stable provider of raw
materials to high-growth markets

Company seeing significant increasing demand; Major offtake partner
increases annual purchase order by 20 percent

Recent balance sheet improvements provides financial strength and
flexibility to execute on its innovation, collaboration and growth
plans
Company to host update conference
call
today at 4:30 PM
ET

August 16, 2021 
Source
: American Resources
Corporation

FISHERS, INDIANA / ACCESSWIRE / August 16, 2021

American Resources
Corporation (NASDAQ:
)
(“American Resources” or the “Company”), a
next generation and socially responsible supplier of raw materials
to the new infrastructure and electrification marketplace, today
reported its second quarter of 2021 financial results and provided
a corporate update.

Mark Jensen, Chairman and CEO of American Resources Corporation
commented, “Over the course of the second quarter of 2021, we
continued to position our Company to be one of the most unique
growth platforms to reposition old-world, legacy assets to
strategically align with a more modern economy. While the first
quarter of this year highlighted the advancement of our American
Rare Earth division by acquiring and synthesizing an innovative
suite of technologies to establish what we believe will be the most
sustainable and environmentally safe sources of critical and rare
earth elements, our second quarter clearly demonstrated our
commitment and ability to efficiently commercialize our
technologies and processes. Our American Carbon division continued
its production ramp up and expansion throughout the quarter
following our deliberate steps to restructure its operations post
acquisition and is on track to continue to scale organically to
meet the demands of the market and drive significant revenue
growth. Additionally, we had the opportunity to further strengthen
our balance sheet, which will allow us to be more opportunistic and
effective in achieving our goals.”

Second Quarter 2021 Key Highlights
Advanced
fly ash sampling program in conjunction with 2kW mobile
electrolytic cell rare earth element (REE) processing plant where
the Company has been working with various parties which control
large deposits of fly ash to explore solutions to reprocess the ash
to create several monetizable products.
Selected as a member of the
Consortium to
Assess Northern Appalachia Resource Yield (CANARY) by the

Department of Energy’s National
Energy Technical Laboratory (NETL)
for an award targeting
REE and critical mineral recoveries from waste
streams.
Significantly
expanded existing sponsored research program with Purdue University
specific to the purification of critical and rare earth elements
using ligand assisted displacement (“LAD”)
chromatography to further refine the process and technology to also
include the recycling, reprocessing and purification of critical
and REEs from lithium-ion batteries and coal waste and byproducts,
in addition to waste permanent magnets.
Secured
expertise to oversee the build phase and implementation of its 2kW
mobile electrolytic cell rare earth element processing plant which
represents another step forward in the commercialization of its
acquired technology and patents from Ohio University in addition to
its research partnership with Texas Tech University.
Successfully
achieved a high purity of the REE Neodymium (Nd), using its
exclusively-licensed LAD chromatography process and technology in
conjunction with its sponsored research partnership with Purdue
University.
Raised
$30.1 million of gross proceeds from the issuance and sale of 8.6
million shares of the Company’s common stock to institutional
investors through a registered direct offering.
Added to the
Russell Microcap
Index
as part of the annual reconstitution.
Further
developed aftermarket distribution channels for waste permanent
magnets and waste lithium-ion batteries to be recycled for their
inherent rare earth elements and critical minerals.
“Looking
forward to the remainder of 2021 and beyond, we remain extremely
excited and optimistic about the opportunities that lie ahead of us
throughout all of our operating divisions. We feel we are highly
aligned with our national priorities in terms of infrastructure and
the growth of the electrification market. Our American Carbon
division, with one of the largest metallurgical carbon growth
platforms in the industry, had a solid quarter of production at
Perry County Resources to build some inventory and begin initial
stoker carbon sales. Our PCI shipments are beginning to a larger
extent in this third quarter of 2021 and our main base-load,
offtake partner recently expanded their purchase order by an
additional twenty percent. Our sights are now set to restart our
McCoy Elkhorn complex during the second half of 2021 as
metallurgical carbon market conditions have materially improved. We
have experienced some labor challenges, like so many industries
nationwide, as some workers have decided to remain on extended
unemployment benefits. Given the labor constraints which
essentially slowed our results by approximately a quarter, we are
now expecting our full-year 2021 revenues to be in the range of $35
million to $60 million as a whole, but are confident in our ramp up
leading into the 2022 year,” continued Mr.
Jensen.

“American Rare Earth represents a very strategic opportunity
for us. Now that we have initially defined our suite of rare earth
technologies and processes, we are extremely motivated and focused
on bringing them to market. Our 2kW mobile electrolytic cell rare
earth element processing plant is currently in its build phase and
we expect to have that in the field early next year. Similarly, our
chromatography facility is expected to be built to a small scale
facility early next year with the capability to scale it to a
commercial facility within its established footprint. We fully
expect to demonstrate the viability and innovation of these to two
processes which are based on efficiency, low-cost, biproduct
economics, and being the most environmentally safe. Collectively we
feel our processes bring real and sustainable solutions to this
critically important and rapidly growing market. Also, the recent
addition of capital to our balance sheet allows us to more broadly
collaborate in effectively establishing supply channels of
end-of-life products to create a truly circular life cycle for
their inherent critical and rare earth
elements.”

“Lastly, our Company-sponsored SPAC, American Acquisition
Opportunity Inc., has the potential to drive meaningful value and
is an example of our nimble, shareholder-focused culture.
We’ve received an exceptional response from a wide variety of
targets and feel confident that we will bring a great target to the
public markets to feed the need of a more modern economy; very much
as we have done with American Resources.”

Expected Near-Term Catalysts
Continued
execution and milestone announcements on American Rare Earth
processing and purification development and
commercialization
Additional
metallurgical carbon offtake agreements
Secure
additional collaboration agreements with sourcing partners for REE
end-of-life materials and REE feedstocks
Announce
key appointments to American Carbon production teams to enhance
production and mitigate future labor challenges
Formalize
SPAC target opportunity

Conference Call Information

American Resources management will host a conference call for
investors, analysts and other interested parties today,
Monday
, August 16, 2021 at
4:30 PM ET.

Interested participants and investors may access the conference
call by dialing (877) 407-4019 and referencing American Resources
Corporation’s Second Quarter of 2021 Conference Call, or by
the webcast link:

Financial Results for Second Quarter 2021

For the second quarter of 2021, American Resources reported a net
income loss of $6.65 million, or a loss of $0.13 per share for the
three months ended June 30, 2021, as compared with a net income
gain of $1.3 million, or $0.05 per share in the prior-year period.
The Company earned adjusted earnings before interest, taxes,
depreciation, amortization, equity-based compensation, warrant
expense and development and restructuring costs (“Adjusted
EBITDA”) of a $537,078 loss in the second quarter of 2021, as
compared with Adjusted EBITDA of $5.7 million
for the second quarter of
2020.

Second Quarter 2021 Summary
Total
revenues were $393,210 for the second quarter of 2021 compared to
revenues of $226,836 during the second quarter of 2020. General and
administrative expenses for the second quarter of 2021 were
$593,621 compared to $684,300 in the prior year period. American
Resources incurred interest expense of $674,829 during the second
quarter of 2021 compared to $1.01 million during the first quarter
of 2020. Development costs during the quarter were $3.06 million,
compared to $1.8 million in the first quarter of 2021.
The
Company did not incur any income tax expense in the second quarter
of 2021 as it was able to utilize its available net operating
losses (“NOL”) carried forward from prior periods of
approximately $17.8 million as of December 31, 2020.

AMERICAN RESOURCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

UNAUDITED
For the three
months ended
June
30,
For the
three
months
ended
For the
six
Coal
Sales
339,314
342,588
524,334
Metal Aggregating,
Processing and Sales
27,875
Royalty
Income
26,021
33,394
Total
Revenue
403,857
751,170
Cost of Coal Sales
and Processing
(944,327
(662,556
(1,744,842
(2,517,743
Accretion
Expense
(305,636
(370,587
(611,273
(741,174
Depreciation
(475,014
(293,746
(868,544
(1,208,798
Amortization of
Mining Rights
(311,685
(313,224
(623,370
(626,448
General and
Administrative
(593,621
(684,307
(1,675,068
(1,527,231
Professional
Fees
(193,951
(316,280
(903,984
(510,326
Production Taxes
and Royalties
(99,475
(89,827
(667,658
(250,057
Development
Costs
(3,055,603
(307,247
(4,867,554
(435,406
Total Operating
Expenses
(5,979,312
(3,037,774
(11,962,293
(7,817,183
Net Loss from
Operations
(5,586,102
(2,810,938
(11,558,436
(7,066,013
Other Income and
(expense)
Other Income
(loss)
(446,884
(1,726,184
(411,588
(314,179
Gain on Sale of
Assets
6,820,949
Amortization of
debt discount and issuance costs
(2,579
(5,758
(5,458
Interest
Income
60,220
41,172
101,392
123,514
Interest
expense
(674,829
(1,011,003
(1,165,942
(1,511,643
Total Other income
(expense)
(1,064,072
4,119,175
(1,481,596
5,112,883
Net Income
(Loss)
(6,650,174
1,308,237
(13,040,032
(1,953,130
Net loss per common
share - basic and diluted
Weighted average
common shares outstanding
52,133,268
26,833,809
49,539,996
27,122,160

CONSOLIDATED CONDENSED BALANCE SHEETS
December
31,
ASSETS
CURRENT
ASSETS
28,109,470
10,617,495
Accounts
Receivable
376,563
38,650
Inventory
638,880
150,504
Prepaid
fees
268,333
175,000
Accounts Receivable
- Other
234,240
Total Current
Assets
29,393,246
11,215,889
LONG-TERM
ASSETS
Cash -
restricted
1,018,903
583,708
Property and
Equipment, Net
21,683,346
22,498,659
Investment in LLC
– Related Party
2,250,000
Note
Receivable
4,117,139
Total Long-Term
Assets
29,069,388
27,199,506
TOTAL
ASSETS
58,462,634
38,415,395
LIABILITIES
AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT
LIABILITIES
Accounts
payable
2,556,852
4,288,794
Non-Trade
payables
3,336,005
3,850,781
Accounts payable
– related party
1,013,313
679,146
Accrued
interest
332,415
1,043,519
Due to
affiliate
74,000
Current portion of
long term-debt
5,368,131
10,997,692
Current portion of
convertible debt, (net of unamortized discount of $492,282 and
$827,573)
12,240,396
Current portion of
reclamation liability
2,327,169
Total Current
Liabilities
27,248,281
23,261,101
LONG-TERM
LIABILITIES
Long-term portion
of note payable (net of issuance costs of $399,909 and
$405,667)
4,742,976
5,330,752
Convertible note
payables – long term
1,021,379
14,300,907
Reclamation
liability
16,139,408
15,528,135
Total Long-Term
Liabilities
21,903,763
35,159,794
Total
Liabilities
49,152,044
58,420,895
STOCKHOLDERS’
EQUITY (DEFICIT)
AREC - Class A
Common stock: $.0001 par value; 230,000,000 shares authorized,
58,876,187 and 40,522,762 shares issued and
outstanding
AREC - Series A
Preferred stock: $.0001 par value; 5,000,000 shares authorized, 0
and 0 shares issued and outstanding
AREC - Series C
Preferred stock: $.0001 par value; 20,000,000 shares authorized, 0
and 0 shares issued and outstanding
Additional paid-in
capital
155,749,003
113,279,448
Accumulated
deficit
(146,444,301
(133,289,247
Total
Stockholders’ Equity (Deficit)
9,310,590
(20,005,500
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CONSOLIDATED CONDENSED
STATEMENTS OF CASH FLOWS
For the six months
ended June 30,
For the six months
endedJune 30,
Cash
Flows from Operating activities:
Net
loss
Adjustments
to reconcile net loss to net cash used in operating
activities:
Amortization of
mining rights
Accretion
expense
Liabilities reduced
due to sale of assets
(3,271,973
Amortization of
issuance costs and debt discount
3,560,019
Stock option
expense
230,050
142,296
Issuance of
warrants in connection with convertible notes
1,223,700
Issuance of shares
for services
10,000
18,800
Issuance of shares
for debt settlement
642,060
Warrant
expense
87,754
Shares returned as
part of asset sale
(1,840,200
Change
in current assets and liabilities:
Accounts
receivable
(103,673
2,387,505
(488,376
365,126
Prepaid expenses
and other assets
(93,333
(175,000
(2,246,713
296,597
(711,104
(1,672,713
Accounts payable -
related party
334,167
108,234
Cash used in
operating activities
(10,445,808
(1,064,524
Cash
Flows from Investing activities:
Cash used in
investments in LLCs
(2,250,000
Cash received
(paid) for PPE, net
(676,601
417,857
Cash provided by
(used in) investing activities
(2,926,601
Cash
Flows from Financing activities:
Principal payments
on long term debt
(787,849
(72,255
Proceeds from
convertible debt
600,000
1,751,477
Proceeds from the
sale of common stock, net
29,218,000
10,500
Proceeds from long
term debt
2,649,800
Proceeds from
warrant conversions
2,269,428
Net proceeds from
(payments to) factoring agreement
(1,807,443
Cash provided by
financing activities
31,299,579
2,532,079
Increase(decrease)
in cash and restricted cash
17,927,170
1,885,412
Cash and restricted
cash, beginning of period
11,201,203
268,811
Cash
and restricted cash, end of period
29,128,373
2,154,223
Supplemental
Information
Non-cash
investing and financing activities
Conversion of
accounts payable to common stock
Issuance of common
shares for debt conversion
2,510,435
Conversion of
Series A Preferred into common stock
Conversion of
Series B Preferred into common stock
Warrant exercise
for common shares
Discount on note
due to beneficial conversion feature
Cancellation of
common shares
Cash paid for
interest
42,426
208,154
Cash paid for
income taxes

Reconciliation of Non-GAAP Measures
Reconciliation
of Adjusted EBITDA to Amounts Reported Under U.S. GAAP
For the three months
ended June 30, 2021
For the three months
ended June 30, 2020
Net
Income
Interest
& Other Expenses
Income
Tax Expense
Amortization
of Mining Rights
Amortization
of Debt Discount & Issuance
Non-Cash
Stock & Option Comp. Expense
147,000
890,910
Non-Cash
Warrant Expense
115,025
1,108,675
PCR
Restructuring Expenses
1,028,304
113,889
Total
Adjustments
6,113,096
4,415,039
(537,078
5,723,276
Adjusted EBITDA is
defined as net income before net interest expense, income tax
expense, accretion expense, depreciation, non-cash stock
compensation expense, transaction and other professional fees, and
development costs. Adjusted EBITDA is not a measure of financial
performance in accordance with GAAP, and we believe items excluded
from Adjusted EBITDA are significant to a reader in understanding
and assessing our financial condition. Therefore, Adjusted EBITDA
should not be considered in isolation, nor as an alternative to net
income, income from operations, cash flow from operations or as a
measure of our profitability, liquidity, or performance under GAAP.
We believe that Adjusted EBITDA presents a useful measure of our
ability to incur and service debt based on ongoing operations.
Furthermore, similar measures are used by analysts to evaluate our
operating performance. Investors should be aware that our
presentation of Adjusted EBITDA may not be comparable to similarly
titled measures used by others.

About American Resources Corporation

American Resources Corporation is a next-generation,
environmentally and socially responsible supplier of high-quality
raw materials to the new infrastructure market. The Company is
focused on the extraction and processing of metallurgical carbon,
an essential ingredient used in steelmaking, critical and rare
earth minerals for the electrification market, and reprocessed
metal to be recycled. American Resources has a growing portfolio of
operations located in the Central Appalachian basin of eastern
Kentucky and southern West Virginia where premium quality
metallurgical carbon and rare earth mineral deposits are
concentrated.

American Resources has established a nimble, low-cost business
model centered on growth, which provides a significant opportunity
to scale its portfolio of assets to meet the growing global
infrastructure and electrification markets while also continuing to
acquire operations and significantly reduce their legacy industry
risks. Its streamlined and efficient operations are able to
maximize margins while reducing costs. For more information
visit

americanresourcescorp.com
or connect with the Company on

Facebook

Twitter

LinkedIn

Special Note Regarding Forward-Looking Statements
This
press release contains “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements involve known and unknown
risks, uncertainties, and other important factors that could cause
the Company’s actual results, performance, or achievements or
industry results to differ materially from any future results,
performance, or achievements expressed or implied by these
forward-looking statements. These statements are subject to a
number of risks and uncertainties, many of which are beyond
American Resources Corporation’s control. The words
“believes”, “may”, “will”,
“should”, “would”, “could”,
“continue”, “seeks”,
“anticipates”, “plans”,
“expects”, “intends”,
“estimates”, or similar expressions are intended to
identify forward-looking statements, although not all
forward-looking statements contain such identifying words. Any
forward-looking statements included in this press release are made
only as of the date of this release. The Company does not undertake
any obligation to update or supplement any forward-looking
statements to reflect subsequent events or circumstances. The
Company cannot assure you that the projected results or events will
be achieved.

PR Contact
Precision
Public Relations
Matt
Sheldon
917-280-7329

matt@precisionpr.co

Investor Contact:
JTC
Team, LLC
Jenene
Thomas
833-475-8247

arec@jtcir.com
RedChip
Companies Inc.
Todd
McKnight
1-800-RED-CHIP
(733-2447)

Info@redchip.com

Company Contact:
Mark
LaVerghetta
Vice
President of Corporate Finance and Communications
317-855-9926
ext. 0

investor@americanresourcescorp.com

The above information was disclosed in a filing to the SEC. To see the filing, click here.

To receive a free e-mail notification whenever NATURAL GAS FUELING & CONVERSION INC.. makes a similar move, sign up!

Other recent filings from the company include the following:

NATURAL GAS FUELING & CONVERSION: American Resources Corporation Expands Carbon Production With The Restart Of Its Mccoy Elkhorn Complex And Secures Initial Sales Contracts - Oct. 8, 2021
NATURAL GAS FUELING & CONVERSION: Press Release Dated October 4, 2021 - Oct. 5, 2021

Auto Refresh

Feedback