There’s good reason Electrovaya officials are happy work to open its Jamestown area factory is progressing.

The company’s fourth quarter and year-end financial statements show a company that is improving its operating margins and cash flow – and the increased production from the Gigafactory in Ellicott is being counted on to boost sales and profits even higher.

“We anticipate starting commercial cell manufacturing operations in the Jamestown facility in the first half of calendar 2026 and battery system manufacturing in 2025,” said Dr. Raj DasGupta, Electrovaya’s

CEO, during a December conference call with investor analysts. “The Jamestown facility substantially expands our capacity and will enable us to pursue an increasing number of larger opportunities that can drive higher revenues and profits. Furthermore, we believe that with domestic and vertically integrated manufacturing, we will be able to increase our gross margins, reduce lead times, and ultimately facilitate larger purchases from customers that are more sensitive to manufacturing origination, like defense.”

Boosting production isn’t the only way opening the Ellicott factory will help Electrovaya’s finances. DasGupta said the company will save money paying the margin of contract manufacturers overseas as well as shipping costs, instead producing those materials locally. Materials will be financed over shorter periods of time, a behind-the-scenes factor in improving Electrovaya’s financial margins.

And, lastly, the company is eligible for Inflation Reduction Act 45X production tax credits created under President Joe Biden that DasGupta said are expected to remain in place under President Donald Trump.

“Our expectation is that those will remain in place and those further improve the gross margins,” DasGupta said. “We’re not depending on them, of course, but if they remain in place, they’re helpful. I’ve spoken with our congressional representatives who covers Jamestown (Rep. Nick Langworthy). He’s a Republican, really good guy. And generally speaking, the impression we get is those remain in place, but who knows? Either way, margins are set to improve. And in the near term, we’re also seeing some of the material costs for our products coming down, which is going to improve margins over the course of 2025.”

YEAR-END FINANCIALS

The company reported 2024 revenues of $44.6 million, compared to $44.1 million in the fiscal year ended September 30, 2023. Electrovaya operates in the October through September financial year, so its year-end results were released in December – roughly three months before most companies. Gross margin was 30.7% in 2024, an improvement of 377 basis points compared to 2023, while battery system margins were 31.3% for the fiscal year.

Electrovaya generated positive cash from operating activities of $1 million for 2024, compared to cash used in operating activities of $5.2 million in, an improvement in operating cash flow of $6.2 million. Company officials said the company’s financial statements no longer require a “going concern” note, a sign of improved financial health.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) was $4.1 million, an improvement of $800,000 compared to $3.3 million in 2023. The fourth quarter of 2024 was Electrovaya’s sixth consecutive quarter of positive Adjusted EBITDA, which indicates a company’s ability to consistently profit. John Gibson, Electrovaya chief financial officer, told investor analysts that the Ellicott Gigafactory will further boost the company’s EBITDA once production begins.

“Well, Jamestown itself is going to be fairly (operating expenditure) light,” Gibson said. “It’s essentially just a bolt-on operating facility. There’s no significant (research and development) or sales and marketing costs within that facility itself. So, we expect it to be fairly high on an EBITDA percentage. So, consolidated EBITDA, we expect to keep increasing as revenue increases. If we take our kind of breakeven point at $50 million, we can scale the business without any significant increase to (operating expenses). So, at a 30% margin, anything above $50 million, you can mathematically just add 30% to the bottom-line. It doesn’t quite work like that, but that’s kind of a rough guide towards us growing and as Jamestown comes on. So, it’s going to contribute pretty significantly to the EBITDA, so we expect it to continue going up.”

TARIFF PROTECTION

With the inauguration of President Donald Trump coming this week, investor analysts had questions about how tariffs might affect Electrovaya. The Ellicott Gigafactory is one protection for the company against tariffs, particularly given its footprint in Asia.

Trump said Tuesday he plans to create a new agency called the External Revenue Service to collect tariffs and other revenues from foreign trade partners. Tariffs, with the threat of a potential 25% levy on all goods from allies like Canada and Mexico and 60% on goods from China, have become a benchmark of Trump’s economic agenda as he heads into his second term.

“Manufacturing, you’ve got parts from, obviously, lots of places,” DasGupta said. “It’s not helpful. However, Electrovaya is in a better position than most. We have the Jamestown operations. We will start making battery systems in 2025. If tariffs look more serious and complicated than we expect, we can, of course, start those operations even earlier. And so, I think we’re fairly well-insulated from those effects of tariffs. And that’s sort of our strategy going forward.”