Good morning, everyone. My name is Lou, and thank you for joining 6K Additive Inc.'s Q3 FY 2026 Appendix 4C and quarterly report briefing. Joining me today are CEO Frank Roberts and CFO Jonathan Wolak, who will be providing an update on the quarterly results released earlier this morning, 26th of October, followed by a Q&A session. Please feel free to submit your questions at any time using the Q&A function located at the bottom of your Zoom screen. We will address them at the end of the presentation. With that, Frank, I will now hand it over to you.
Thank you, Lou. Good morning, everyone. Thanks for joining us. I guess to start, Q3 was another strong quarter for 6K Additive, highlighted by record revenue, record backlog, and continual operational improvements. At the same time, we have made meaningful progress on our expansion of our Burgettstown campus, which we will talk about. Today, we are going to walk you through our competitive positioning, the commercial pipeline, operational progress, and where we are deploying the capital to support the next phase of growth. Here you will see the forward-looking statements disclaimer, and we will get right into it.
6KA, we are a U.S. based manufacturer of high-performance metals, serving a variety of industries where quality, performance, and supply chain reliability are really becoming very essential. Our materials support applications across defense, aerospace, medical, and several advanced manufacturing industries. These are applications where performance is critical and customers are really prioritizing secure domestic supply chains.
What really differentiates 6K Additive is our combination of proprietary manufacturing technology, a broad metals portfolio, and well-established commercial production. Our business operates across two primary product categories, our metal powders and our alloy additions. The metal powders business supplies metals into aerospace, defense, and other advanced manufacturing industries. The alloy business supplies titanium and zirconium additions into major industrial markets that are leveraging aluminum as their primary supply material. Both businesses see the benefit from our materials expertise, our established customer relationships, and that growing demand for domestically sourced critical materials. The big significant advantage of 6K Additive is our UniMelt technology. That is our microwave-based plasma process.
Unlike traditional powder manufacturing technologies that often rely on expensive raw materials, our process is capable of utilizing varying forms of scrap at significantly lower cost, and we convert that scrap into ultimately highly spherical metal powders that are going into some of the most demanding manufacturing applications in the world. Our ability to ultimately recover materials from customers and reintroduce them into the manufacturing process really strengthens our value proposition, and I will talk about that in a little bit. Overall, this is much more than just a recycling story. This is a manufacturing platform with a fundamentally much better cost advantage than legacy means of manufacturing. What I mean by that is there is really three primary drivers here. I talked about our raw materials coming from varying forms of scrap. Scrap, much lower cost than what you would see in traditional atomization technologies.
That's the legacy means of creating metal powders, spherical metal powders used in 3D printing. Lower cost basis on raw material, much higher yield, about 50% higher yields that we're able to get to our customers than that legacy technologies, and then a much more efficient means, much lower energy consumed in the creation of our plasma and ultimately our product. When you combine all of these advantages, that really translates to meaningful reductions in cost of the finished product. As you see on the chart indexed on the left, this chart was pulled together through a third-party lifecycle assessment, really demonstrates the stack of low-cost raw material, high yield, and ultimately low consumption of energy translating to at scale, significantly lower cost basis. The broad materials portfolio really positions us across several strategically important markets.
Our nickel-based powders are used to support varying defense and industrial customers that are demanding high temperature and often high wear applications. Titanium powders predominantly used in aerospace and medical markets, where quality and consistency are absolutely critical. The refractory materials that we're manufacturing, that would be tungsten, tantalum, and niobium alloys, serving really high demanding applications across defense, aerospace, space exploration, and even emerging technologies such as nuclear fusion. On the alloy side of the business, the titanium and zirconium additions, they're primarily used in the production of aluminum and primarily serving the overall global automotive and aerospace industries. The breadth of the product portfolio that we're making allows us to participate in multiple customer programs and end-use applications. Really few companies compete in terms of that breadth and particularly the domestic manufacturing capabilities that 6K Additive brings to the market.
We'll dig in now to the overall quarterly highlights, Q3 of 2026, and we're really excited about the progress that we made this quarter. We're going to walk through some key commercial, operational, and financial metrics that are supporting the performance. Number one, exited the quarter with a record revenue, and that's really providing us in what is an increasingly strong customer order position. On the powder side of the business, the order intake increased to a little over $12 million, and that's demonstrating the continued demand for our materials portfolio. I'll talk here in a bit about our 30 month agreement with ADDMAN for nickel powder, and that's really demonstrating our ability to transition from what was once a spot business to long-term agreements and looking to execute that, and develop more customer relationships like our program with ADDMAN.
At the same time, significant reduction in cash burn in the quarter, down to $2.4 million versus $3.1 million in the prior quarter. Finally, continued investment in the facility in Burgettstown, Pennsylvania. I'll talk about that. That's ramping up as we're looking to expand our overall capacity and really convert what is significant commercial demand to real financial results. Commercially, really nice performance as well. The $7.2 million is another quarterly record for us. About a little over 60% growth over the prior year's performance for the same quarter. The powder revenue increased significantly, 72% year-over-year, and alloy 34% year-over-year in the prior period. Order intake, as I mentioned, on the rise, demonstrating that continued momentum from our customer base and the purchasing activity.
The backlog continues to climb, or the pipeline, sorry, commercial pipeline continues to climb, now approaching nearly $300 million in annual buy. I think two key takeaways on this slide. Revenue growth is increasingly supported by customer demand, and the growing backlog is providing much greater visibility into future growth of the business. If we can just look at the two business segments and a couple of key highlights here. The powder business in particular, up to $5.5 million in the quarter. So a nice increase. That is up 10% over the prior period. Seeing that contracted agreement increase to 43% over the prior quarter, and nickel sales extremely strong, up 50% Q3 versus Q2. On the alloy side, similar trends, a nice revenue number in what is typically a soft third quarter in the aluminum manufacturing industry.
The team is still able to see decent trajectories here. The alloy order intake also on the rise at $1.2 million, and a key qualification achieved in the quarter with a major U.S. aluminum producer, and that is really underpinning the potential for future growth on the alloy business. Just a little deeper dive here on that ADDMAN long-term supply agreement. This is a really significant commercial development for the team and 6K Additive, and as I mentioned, converting from what was once a spot business to a long-term agreement. This has a minimum contract value of $8.1 million , and the ability to stretch to nearly $11 million. It is over 30 months, and so it incorporates integrated stocking programs but also a revert buyback program.
That is really where we are able to partner with customers and leverage buyback that not only creates a cost advantage for both ADDMAN and 6K Additive, but this is really the exact type of customer relationship we are looking to build. Long-term supply agreements with manufacturers that have reoccurring production requirements, and we are able to leverage that revert buyback where it is mutually beneficial, creates a really nice partnership. Operationally, really strong execution as well. On the left side, you see some key metrics in terms of overall productivity performance. Notably, first and foremost, always safety. 6,000 days plus combined recordable free across all operating sites. But really nice performance in terms of execution from the team. On the right side of the slide here, you see the Q3 expansion project in Burgettstown. A lot of momentum building here. All the major earthwork complete.
The precast structure I will talk about in a minute well underway. High voltage switchgear now installed to support a significant increase in capacity. All the long lead time equipment is on order, and we expect to maintain this schedule and see this facility under roof and installing equipment here as we step through Q4. A little bit more on that expansion. The picture you see on the left is the full rendering of the campus as it is complete by the end of calendar year 2027. The first phase of that is strategically designed to increase the current bottleneck, which is our powder capacity. You see that highlighted. The two pictures on the right show the current state of that project. The precast structure is now under roof, and the team working on some of the infrastructure on the inside.
This is where we house our UniMelt bays. This will account for additional UniMelts being installed, and then we'll be moving to the next portion here in the coming weeks, which will house our atomizer. All of this supporting what is ultimately, it'll be 6,000 metric tons of total capacity, but notably, a 5 x increase in overall powder capacity. With the increased backlog, the increased pipeline, what's compelling about the expansion is we're not out there building capacity in the hopes that the market's going to come up. This is demand we already have, and this is going to enable us to execute and service that growing demand. With that, I'll hand it over to Jonathan to talk about some of the financial aspects.
Sure. Thank you, Frank. In the quarter, we ended with $16.3 million of cash on the balance sheet. Break that into the different subsections, we burned $2.4 million of operating cash flow. As Frank mentioned earlier, that's a 22% improvement versus the last quarter, and that's another thing that the consolidation and capacity expansion will also continue to allow us to improve going forward, is again, improving that operating cash flow number. That was largely driven by our largest collections from customer receipts of $7.9 million in the quarter. Again, as our revenue has increased, our customer receipts have obviously increased. So really happy with the operating cash performance in the quarter. As we mentioned again in the prior 4C release, we were going to be seeing a ramp-up in the capital spending, and we did in the quarter, up to $3 million.
We're guiding now the full-year number to be between $10 million and $11 million, versus the prior guidance, which was $11 million - $12 million. Again, pretty much on track with the capital spending. Then last but not least, we did have some financing outflow in the quarter that was primarily related to the closeout of the EXIM loan and the agreement we've obtained with them going forward. On the next slide, I want to focus everyone's attention first to the left-hand side, which is our use of funds compared to the original prospectus. Everything continues as planned with the initial prospectus. We've seen some obviously increases of capital spending related to the project. But really what I want to spend some time on is the right side.
Really what separates, I think, 6K Additive from other people in the space is really the strength of our liquidity. I want to start with the first bar, really outlining the three key sources of our liquidity. The $16.3 million, which as I mentioned before, that was our closing cash balance in the third quarter. We still have $13.5 million remaining on the DPA Title III grant from the U.S. government. Last but not least, which again, we are very excited about, is finally closing out the EXIM loan, which provides an additional $25.2 million of principal financing. Again, ending the quarter at $55 million of total liquidity. As we bridge down, I mentioned the high side of the remaining CapEx we have in 2026 is $7 million.
Going forward into 2027 to complete our powder expansion and start our next phase will be another $14 million of CapEx. Really the liquidity, subtracting that CapEx is around $34 million. Then we just put up against the run rate of what our operating cash flow was in the quarter multiplied by four. As I mentioned, the expectation is with capacity coming on site as well as the consolidation, that number is expected to continue to decrease. But really outlining that we have plenty of liquidity available to continue our capacity expansion and fund the business with some additional padding, as called out with around $25 million of excess liquidity.
Thanks, Jonathan. As we wrap up, I want to leave you with four key takeaways. First, our commercial momentum continues to strengthen, delivering record quarterly revenue and now approaching that nearly $29 million in annual run rate revenue. We are seeing continued customer adoption and growing demand for our materials. Second, the demand continuing to outpace our manufacturing capacity. The backlog continuing to grow, up 52% versus the prior quarter, and that pipeline now approaching nearly $300 million in U.S. annual buy. That is an important point because, as I mentioned, we are building capacity not in the hope that demand materializes, but we are building capacity to service demand that already exists.
The third is we are executing on that expansion strategy. Significant progress in the Burgettstown facility, and expect that to continue to ultimately achieve that 6,000 metric tons of total capacity across all product lines, notably over 1,000 metric tons of dedicated powder capacity. Finally, as Jonathan just touched on, we are really well-positioned for growth, ending the quarter with $16.3 million in cash. The access to the DPA Title III funds that remain to help support that program, and now the EXIM loan well positions us for execution of the plan and beyond. I think when you bring it all together, the investment story is compelling. We have got a differentiated manufacturing technology, a structural cost advantage, and an increasing demand of sourcing critical materials that are U.S. based.
For now, it is a continued focus on executing of our strategy and continuing to expand the capacity and serving demand that is there and on tap, ready for future growth. With that, I thank everybody for their time, and I will hand it back to Lou for questions.
Thank you, Frank, and thank you, Jonathan. Let's move into some of our questions for today. First question, powder productivity was up 4.5% on Q2. What drove that improvement?
Yeah, that's strong execution from the team. Continuing to optimize and organically find means of increasing cycle count, cycle time, and just get more efficiency out of the machines. That's really a testament to the team executing and our, I'll still put him in the new category, Brandon Davis, our COO, really getting his feet under him and driving strong operational execution. That's really organic efforts.
Thanks, Frank. Operating cash flow improved to $2.4 million, which is a good result. How much of that do you see as structural, and how much was timing?
Do you want to touch on that one, Jonathan?
Yeah, I think the vast majority of it is structural. Our cash receipts or receipts from customer was slightly above our run rate revenue, so we had some additional increases there, but that's expected to continue at that run rate. The other real positive thing is we built inventory in the quarter as well, which was obviously a use of cash to kind of de-risk our consolidation here as well. So really, I think we've already demonstrated the continued improvement that our scale has. We've basically proven out that with our increased revenue and our increased scale, that our operating cash flow burn will continue to decrease.
Thanks, Jonathan. A few coming through for the expansion. When the new bays are running at full capacity, what will be different about how the business operates day to day?
Yeah, I think there's a lot of opportunity for operational efficiency as we continue to consolidate facilities. Right now, we ship a lot of materials back and forth, so anticipate a lot of operational efficiencies to be gained. Fundamentally, there's not going to be meaningful change in how we run the business. Each area has a lead, and we'll continue to execute that strategy. But I think there's a lot of room as we step forward. As Jonathan just was alluding to, the reduction of cash burn and meaningful portion of that coming from the consolidation of currently operating six facilities and the future of operating one. But you can see how now you'll be able to get even more than what we're currently anticipating with operational efficiency gains across the entire portfolio of products.
Thanks, Frank. Just following on from that one, when are you planning to relocate the atomizer from Hayward that will allow for further improvement in operations?
Yeah, so that work is actually underway now. So it will be the bulk of this quarter we will be relocating that atomizer. So over the next couple of months, it will start making the migration to the Burgettstown campus, and then be reinstalled and recommissioned first part of 2027.
Thanks, Frank. A few for the ADDMAN agreement. First of all, congratulations. What drives the range between $ 8.1 million and $ 10.8 million, and do you expect more agreements like this in the future?
Yeah. So what drives the range is effectively as they are continuing to scale their business, we wanted to make sure, and they wanted to make sure they had room to flex. So the $8.1 million is a guaranteed take or pay, but we gave them room to grow beyond that, but put a cap on the top end of that. So, we are giving them room to continue to grow, build momentum, but put a cap on it so that we can make sure we are maintaining adequate market share elsewhere. We anticipate this is the first significant long-term agreement for 6K Additive, and our goal is to continue to execute and convert more of what is spot or shorter-term agreements into agreements like this where we are able to leverage our full value proposition.
Yeah. Is ADDMAN in the $ 18.1 million backlog figure at the low end of the range, so around, say, $ 8.1 million?
Correct. Conservatively, that number is in our backlog at $8.1 million, the minimum take or pay.
Perfect. Another one, with the policy focus on domestic critical materials, where do you see the biggest opportunity for the company over the next couple of years?
Yeah. There is certainly a clear focus on ensuring DFARS compliance. The Department of War is looking beyond where the actual products are made. They are looking to the point of origin of the material that is feeding these products. It is a great scenario for 6K Additive, being most of our raw materials are U.S. based, and so we check all the DFARS boxes. I expect, certainly with the defense spend, a significant amount of the growth moving forward coming from the defense sector. But as I mentioned, we are pretty diverse, and we are seeing growing demand really across the board as the 3D printers have gotten larger and it is taking more product, and so more powder to feed the machines. There are more machines out there on the market, and the utilization of those machines continues to increase.
There is a lot of opportunity really across the board, medical, industrial, consumer electronics, where you are seeing large market adoption of additive manufacturing. Defense is a big portion of our focus, but it is much more diverse than that. We are really not centered and dependent on one market in particular.
Thanks, Frank. One last question for today. You actually touched on this earlier in the presentation, but what do you think customers value most about 6K compared with other conventional powder suppliers?
I think that depends on the customer, because there's a couple of different things. I think quality is first and foremost. Our ability to service the customer. DFARS compliant. That compliance is coming into discussion more and more, and looking through the supply chain to make sure that we're minimizing any vulnerability from that standpoint. I think lastly, we bring a very unique value proposition in our ability to partner with customers and buy their scrap back at a premium. That ultimately lowers their cost. At the end of the day, quality is a given. You've got to meet or exceed the spec, but you have to do it at a favorable cost position.
Anytime they can get more for the scrap that they're generating, then that lowers their cost, that makes them more sustainable, but also gives them the opportunity to maybe get a little more aggressive in how they cost and price products, and takes more business from the subtractive manufacturing and justifies them moving to the additive space. So it really works in concert. But that's really the whole view, the holistic view.
Thanks, Frank. Before wrapping up the webinar, do you have any closing remarks for us?
Yeah, I think this is a really straightforward focus for us moving forward. We are head down executing on our expansion progress and making sure that we're bringing up this capacity online as quickly as possible. While we're doing that, we're maintaining our customer base and continuing to execute commercially and grow that pipeline. That's our core focus here for the foreseeable future, is get the capacity online, continue to build on that commercial momentum and build that pipeline. Then as we transition into 2027, continue to execute and convert more longer term arrangements like the ADDMAN. It's a fairly straightforward focus for us for the foreseeable future.
Thanks, Frank, and thank you all for joining us today for 6K Additive Inc.'s Q3 FY 2026 Appendix 4C and quarterly report briefing. A recording of today's session will be made available on the 6K Additive website in the coming days. We appreciate your time and interest, and we look forward to hosting you again soon.