All right, everybody. Thanks so much for your patience in waiting on the line. We will now begin the KULR Technology Group fourth quarter and full year 2021 earnings call for today, Thursday, March 17, 2022. Let me give you an overview of the phone call. The call is going to consist of opening statements from Michael Mo, CEO, Keith Cochran, President and COO, and Simon Westbrook, CFO. The company will then answer questions from a group of analysts that have joined us today. Before we get this call started, I'm gonna read the safe harbor statement. Many of you know these safe harbor statements can be found at the bottom of every press release, as well as on the filings for the company. Now, statements on this call do not constitute an offer to sell or a solicitation of offers to buy any securities of any entity.
This call may contain certain forward-looking statements based on the company's current expectations, forecasts, and assumptions that involve risks and uncertainties. Forward-looking statements made on this call are based on the information available to the company as of the date hereof. Actual results may differ materially from those stated or implied on this call. Now, if you wanna learn more, again, find the filings for the company on the SEC as well as at the bottom of the press releases for the company. At this time, I would like to introduce Michael Mo to the call. Michael, the call is yours.
Yeah. Hey, thank you, George. I appreciate all of you for joining us today on our Q4 and full year 2021 earnings press release call. I'm happy to report that 2021 was a pivotal and significant year for KULR in our growth path. We continued our strong expansion in the fourth quarter. Revenue increased by 267% year-over-year to $766,000. For the whole year of 2021, we achieved a total revenue of over $2.4 million, which is 287% growth over 2020. We also had approximately $14.9 million of cash on the balance sheet at the end of 2021 compared to approximately $8.9 million of 2020. These financial results have put KULR in the strongest financial position in its history and has built a solid foundation to continue our growth in 2022 and beyond.
Through 2021, we made significant investments in our people, our infrastructure, and product development. We expanded our executive management team. We grew our workforce by over fourfold. We moved into a new facility that's three times larger. Additionally, we launched a number of new product development efforts, including KULR-Tech Safe CASE, CellCheck, cell screening automation system, and a new battery architecture development. All these product launches and developments are progressing well. The Safe CASE product is gaining significant traction in the marketplace through our partnership with Retriev Technologies. With the recent acquisition of Battery Solutions, we're the largest end-to-end battery recycler in the United States. We believe Safe CASE will drive significant business growth to KULR in 2022, supporting the battery recycling, battery storage, and transportation markets. We're very excited about the growth opportunities in 2022.
We see energy storage and battery recycling as the key growth drivers for us in the commercial market segments. Our partnership with Volta Energy Products positions us to deliver significant growth in the commercial energy storage market. As part of that team, KULR will support products and services in support of Lockheed Martin's demand for energy systems for their DoD customers. In addition, we expect to see customer launches which incorporate KULR's proprietary BTR design in electric aviation and micro-mobility. In the battery recycling and transportation market, we're expanding our SafeCASE product line to facilitate the storage and transportation of new and used batteries for e-mobility, power tools, micro-mobility such as e-bikes and consumer electronics.
As companies and governments around the world pledge to meet net zero emissions over the next few decades, KULR products and technologies are uniquely positioned to accelerate the adoption of clean and sustainable energy products that propel the migration to a global circular economy. In 2022, we expect to see continued growth in our thermal management business with government agencies and DoD customers. Our long-term strategy has been to co-develop cutting-edge thermal management technologies alongside NASA, the U.S. Department of Energy, the U.S. DoD, and while working in close collaboration with regulatory agencies and international testing organizations. Our goal is to incorporate these technologies into regulatory roadmaps that can serve multiple mass market applications. As we deploy these technologies into markets such as energy storage and electric transportation, we look to leverage our IP across multiple verticals and capitalize on multiple revenue streams to accelerate our revenue growth.
We expect this flywheel effect to continue and possibly accelerate in 2022. All in all, we are very excited about this year and expect our growth to continue into 2023. Next, KULR President and COO, Keith Cochran, will give an update on our business operations. Keith, please. Thanks, Michael, and thanks all for attending today's call. We appreciate that. As Michael said, we relocated in October of 2021 to a new facility located at 4863 Shawline Street, San Diego, California. Our facility is three times larger than our previous facility, with adequate room to support our forecast and personnel growth and new automated battery cell testing capabilities that will launch in Q3 of 2022. Additionally, we installed independently enclosed areas to support the machining shop, testing lab, battery lab, and FTI stocking lab.
We have implemented a private standard for the entire facility and will seek ISO 9001 certification in June 2022. With regards to the automated battery cell testing mentioned earlier, KULR began work to meet in Q2 of 2021 to support the stringent requirements battery cell testing for NASA and the Department of Defense. This platform has been designed to meet the entire specification from NASA for construction of these batteries, battery testing requirements. Automated equipment is modular and the initial capacity of each capability is 500,000 cells annually. Based on the current commitments for the equipment, we intend to have the system installed and validated in Q3 of 2022. I also mentioned earlier about employee growth. In January 2021, KULR had 10 full-time employees.
As of March 1, 2022, the organization has grown to 55 permanent employees, with an additional 45 people working on KULR projects via contract. KULR has many open requisitions today to support our growth outlook, primarily in sales, engineering, and technicians. We are pleased that we have been able to hire top talent to continue accelerating the growth of KULR platforms. Some of our recent hires include Dr. William Will Walker as Director of Engineering and Peter Hughes as Technical Marketing Engineer, Battery Applications. Both individuals have already had distinguished careers with NASA and now bring their collective knowledge to KULR to support our renewable energy platforms. KULR will continue to add additional permanent employees as needed while using outsourced leverage where appropriate. An example of outsourced leverage for KULR is in cybersecurity.
In 2021, KULR engaged with Management Solutions to enhance our IT infrastructure and improve all aspects of cybersecurity. As a subcontractor for Department of Defense programs, it is vital that KULR has state-of-the-art IT systems and controls. We believe the best path based on our current scale is to outsource this activity to a professional IT services organization. The result of this activity has been an estimated improvement of our NIST score of over 100 points. This critical improvement opens additional opportunities for KULR in support of their DoD programs. Next, KULR CFO, Simon Westbrook, will give an update on our financial highlights. Simon?
Yeah. Thanks, Keith. Well, we invested heavily in strengthening our team and building out our infrastructure this year as we prepare for a ramp-up in growth of our future business. This was reflected in our results for both the fourth quarter of 2021 and the whole year ending December 31, 2021. For the quarter, our revenue increased from $2,208,000 to $766,000 in the comparable quarters. Our gross margin increased from $166,000 to $536,000. Our operating expenses increased from $845,000 to $4.5 million, which included a $1.4 million non-cash stock compensation charge.
Our net loss increased from $859 thousand to $4.1 million, and our net loss per share went from $0.01 to $0.04 per share. For the whole year ended December 31, our revenue increased from $624 thousand to $2.4 million. Our gross margin increased from $436 thousand to $1.5 million. Our operating expenses increased from $2.8 million to $12.9 million, which included $4.2 million of non-cash stock compensation expense. Our net loss increased from $2.9 million to $11.8 million, and our net loss per share increased from $0.03 to $0.15 per share.
At the end of the year, we have $14.9 million in cash compared with $8.9 million at December 31 last year, which leaves us well positioned to expand operations, support new business, and fund ongoing product investment and development in 2022. Thank you.
Back to you. All right. Thank you, Simon. At this time, we are going to welcome to this call. We've got Jake Pakulski. He's from Alliance Global Partners. He's a Managing Director and Senior Research Analyst. Jake, you're on the call. You have a couple of questions. Please read off your first question for us. Yeah. Hey, Michael, Keith, and Simon. Thanks for taking my questions. Just looking at margins here, we've seen some cost inflation across the board in various industries over the last quarter or two.
Can you maybe just walk us through some of the inputs you're most sensitive to from a cost standpoint, and maybe touch on any steps that you think you can take to mitigate for margin pressure created by more general cost inflation?
Yeah, I'll
Sure.
Okay.
Go ahead.
Yeah. No problem. Okay. Obviously, you know, we do have a global supply chain. Transportation costs are sensitive for us. Material pricing is also sensitive for us. And I can give you some mitigating factors now. We have begun the process of relocating some of our outsourced manufacturing down into Mexico. We found very good supply chain partners there, and we're rapidly making the move to bring those partners up to improve our not only logistics costs, but also the flexibility for our customers in the end.
Hope that helps. Yep. No, that's helpful. Just looking at SG&A, I mean, you guys have obviously done quite a bit of hiring as you've been growth mode over the last year or so. Do you think these levels can remain somewhat constant throughout 2022? It sounds like you guys are obviously focused on growth this year as well, as revenue continues to ramp.
You know, Jake Pakulski, as I mentioned in my prepared comments, we'll definitely continue to grow our organization, but we're gonna do that in a combination of internal hires as well as outsourced leverage. Where that makes sense, you know, we choose to do some of that outsourced leverage. I think the past year for us has been about building the bones of the company. We've added TTS cells, an entire HR program and management system in place, brought in a lot of senior engineering talent. All of this has created a really outstanding portfolio of platforms that now are being realized primarily starting in the second half of the year for us to really see the fruits of all of that labor.
I think we've done a lot of the heavy lifting as far as senior infrastructure personnel-wise for the company. We'll see probably a little bit of tailing off there. We'll definitely see growth in sales personnel and in our technicians and also some of our engineering, especially on the automation side.
All right. Next we have Litchfield. We've got Theodore O'Neill from Litchfield Hills Research. He is a research analyst. Theo, welcome to the call. You have a couple questions for the management team.
Thanks. My first question, I think you just covered it on a previous question here, but you've been doing a lot of hiring and I was wondering, do you expect 2022 expenses to go up as much as they did in 2021? How do you see your business growth catching up for these cost increases?
Hey, Theo. Great to hear from you. As Keith was saying, 2021 was a lot of heavy lifting. You know, hire of a lot of engineering talent, build a foundation. We really make very significant investment, you know people, infrastructure, manufacturing process and product development. There's a very high percentage of, you know, year-over-year growth or increase on the expense side. We don't at this moment expect the same percentage growth or increase on the cost side because a lot of heavy lifting, the foundation has been built. We expect the revenue growth to continue in 2022 and 2023.
Sooner versus later, the two will catch up and you know will put us in a better or really good financial position.
Okay, on the automated battery testing market, can you give us a look into how you differentiate your products versus current ones used to test cells that are currently in production?
Yeah, sure. I can certainly do that. You know, I think there's a lot of automotive manufacturers out there today that do have internal testing for cells. You know, they test somewhat limited parameter for their cells before they deploy into packs for EV markets. You know, as I said, the KULR solution and specifications are designed to ensure that every cell has been tested and will implement very rigid standards of operation for mission-critical applications. I think that's a big differentiator. These battery cells go into applications whereby if it's a defective cell, the mission is at great risk. It's one thing, you know, to have your car break down on the side of the road. It's a whole different problem when you're in flight, space or, you know, waters, or particularly submersible.
The KULR solution is able to be program customized to support various testing needs of a wide variety of OEMs and government agencies as a service offering versus the in-house solutions used, you know, by automotive manufacturers. I would say, you know, KULR, you know, it's kind of a little different as well because we track all of the testing information at a cell by cell level. Our customers at any time can dial into our system and see the performance of the cells as it's been through our process. If they ever do have some type of an event, they're able to go back and see exactly what all the parameters were for that particular cell. We can bring in the OEM manufacturer of that cell to do detailed discussions with data.
All right. Well, now we're gonna be joined by Principal Equity Analyst at Taglich Brothers. That's John Nobile. He's got a few questions. John, the floor is yours. The call is yours.
Hi, and thanks for taking the questions on this call. Congratulations on the fourth quarter and year results. Obviously, commercialization looks like it's ramping up nicely. Just a few questions, Michael or whoever could answer this. As far as you know, does Volta still plan to bring between 750-1,000 battery storage units to market in 2022? And are they looking still to increase that up to 50,000 units in 2023?
Yeah. Hey, yeah, the answer is yes. They're very bullish on the ramp-up plan for 2022 and 2023. As a matter of fact, I think they announced in January, they received $100 million in equity financings, which includes some of the strategic investors, National Grid and Sunbelt Rentals. National Grid is one of the largest utility companies, and Sunbelt Rentals is like $11 billion utility rental company. Now, these companies that are, you know, shareholders and strategic customers, we're actually more confident in their point of use energy storage product. By incorporating KULR's, you know, PPR design, the product has the highest rating in the industry. We believe we'll be a leader in the market.
Very, very bullish on that product.
Great. That's good to hear. What potential do you believe the acquisition of the IP rights from Centropy could have on future sales of your products and high power computing applications? Obviously, with Bitcoin and crypto mining, that's a very big area. I just wanted to grasp, you know, what type of market this could be and where do you see yourselves with this in, say, a few years from now?
Yeah. No, that's a great question. Actually, you know, the acquisition like this kind of IT acquisition is really kind of a sweet spot for KULR. We really wanna apply more high performance ITs, and to incorporate into our existing platform to kind of enhance the performance across multiple applications, not just on the, you know, high performance power computing in the Bitcoin mining case, but even incorporating to our existing aerospace and defense applications as well. We see that there is a lot of applications for that. We expect to actually acquire more ITs along that line, to go both horizontal and vertically on the stack. The goal is really to build the end-to-end product solution to the market. You know?
You'll see us continue to execute on that strategy.
Okay, great. Just one final question. Could you talk a little about the market potential you believe is possible from the U.S. Department of Transportation's permit authorizing your KULR-Tech Safe CASE for battery transport?
Yeah. Hey, Michael, I'll take that one. Hi, John, thank you for your question. We've touched on this a little bit in the past, but let me expand a little further. Right now the total market for lithium-ion battery recycling in 2021 was about $5 billion. It's growing at a 22% CAGR. You know, we expect that market to grow to $24 billion by 2030. A lot of government incentives, you know, behind that. The recycling industry provides a wide range of services, including facilitating the reclaim of damaged, defective, and recall batteries, which is what our SafeCASEs provide protection against. Our DOT special permits make the KULR solution perfect for these types of applications. This is where we are seeing really solid gains in our business and outlook.
All right. That wraps up our questions for the call today. I do wanna point out once again, an entire recording of this call will be archived on the KULR Technology website. Again, you can reach out to the company directly at that website as well with your investor questions. You've been listening to the KULR Technology Group fourth quarter and full year 2021 earnings call. Thank you so much for joining us. Thank you to the management team, Keith, Michael, and Simon as well as our analyst who's joined us here today. Most of all, thank you to the investors and shareholders for your belief and support in our company. Have a wonderful rest of your week.