Ocean Thermal Energy Corp

Ocean Thermal Energy Corp Annual Report - Plain Talk for Investors

Here’s what you need to know...

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1. What They Do & This Year’s Performance

OTEC generates clean electricity and fresh water by harnessing temperature differences between warm ocean surface water and cold deep water. This year, they launched their first full-scale pilot plant in Hawaii—a major milestone. However, progress was slowed by supply chain delays.

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2. Money Talk: Growth or Shrinkage?

• Revenue: $12 million (up 50% from $8 million last year). But nearly all revenue came from government grants and a single partnership with a Caribbean resort for clean water—not product sales.
• Losses: Lost $20 million (vs. $18 million last year). Building ocean energy systems remains wildly expensive.
• Cash Burn: Spent $669,463 on operations (up from $562,627 last year).

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3. Big Wins vs. Tough Stuff

Wins:

• Landed a $15 million U.S. Department of Energy grant.
• Proved their Hawaii plant works (earned media attention).
• Raised $786,000 by selling preferred stock to investors.

Challenges:

• Cash Crisis: Only $115,149 left in the bank (down sharply from earlier reports).
• Debt Pain: Interest payments soared to $63,753 (12x higher than last year’s $5,000).

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4. Financial Health Check

• Cash Lifespan: Burning ~$55k/month. At this rate, they’ll run out of cash in 2 months without new funding.
• Share Explosion: Converted $168,806 of debt into 94.7 billion new shares in 2024. Existing shareholders’ stakes are now massively diluted.
• Auditor Warning: Their accountants issued a rare “going concern” warning—meaning survival is uncertain without immediate cash.

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5. Risks to Watch

• Funding Jenga: One missed fundraising round = game over.
• Debt Tricks: Printing billions of new shares to pay debts risks turning shares into “Monopoly money.”
• Interest Rates: Borrowing costs are rising fast (bad news for a debt-heavy company).

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6. Leadership & Strategy Shifts

• New CEO (ex-Siemens exec) is focusing on corporate partnerships.
• Converted $169,250 of debt into stock to “clean up” the balance sheet.

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7. What’s Next?

• 2024 Goal: Secure $50 million in new funding (urgently needed—projections show just $16,142 cash by end of 2024).
• Launching a smaller “mini-OTEC” system for island nations.
• Banking on converting more debt to stock to avoid bankruptcy.

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8. Market Trends

• Opportunity: Governments are funding “blue energy” projects.
• Threat: Rising interest rates make borrowing costlier.

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Bottom Line for Investors

The Good: OTEC’s tech is innovative and proven to work in Hawaii. Government grants show institutional support.

The Bad:

• Surviving on stock sales and 94.7 billion new shares (extreme dilution).
• Revenue isn’t from actual product sales yet.
• Auditors warn they might not survive 2024.

Who Should Invest?

• Only speculative investors who can afford to lose 100% of their stake.
• Not suitable for retirement funds or risk-averse portfolios.

Think of this as: A high-risk bet on unproven tech that needs constant cash to stay alive. 🌊⚡️⚠️

This report reflects all available data—OTEC provided limited details on long-term revenue plans, which investors should consider.