Abpro Holdings Reports Significant Financial Changes Following Business Combination, Raises Doubts About Future Viability

Abpro Holdings, Inc. (formerly Atlantic Coastal Acquisition Corp. II) reported significant financial changes in its unaudited quarterly results for the period ending September 30, 2024. The company, which operates as a shell entity, has undergone a business combination with Abpro Corporation, finalized on November 12, 2024.

As of September 30, 2024, Abpro Holdings had total assets of $7.9 million, a substantial decrease from $37.4 million at the end of the previous fiscal year. This decline was primarily due to a significant reduction in cash and marketable securities, which fell from $29.7 million to $1.4 million. The company's cash and cash equivalents dwindled to $13,597, down from $264,538 at the end of 2023. Total current liabilities also decreased to $9.0 million from $35.4 million, while total liabilities were reported at $19.5 million, down from $45.9 million.

The company reported a net loss of $335,100 for the three months ended September 30, 2024, compared to a net income of $2.1 million for the same period in 2023. For the nine months ended September 30, 2024, the net loss was $1.7 million, a stark contrast to a net income of $2.8 million for the same period in 2023. The losses were attributed to increased operational and formation costs, which rose to $1.9 million for the nine-month period, compared to $1.3 million in the prior year.

The business combination involved the issuance of approximately 50 million shares of new common stock, with 39.4 million shares allocated to Abpro Corporation shareholders and additional shares reserved for rollover RSUs and stock options. The company also executed a PIPE investment agreement, raising $6.2 million from Abpro Bio and $5 million from Celltrion.

In terms of cash flow, the company reported net cash used in operating activities of $776,000 for the nine months ended September 30, 2024, an improvement from $1.5 million in the same period of 2023. However, cash withdrawals from the Trust Account for stockholder redemptions totaled $29.7 million, significantly lower than the $276.5 million withdrawn in the previous year.

Abpro Holdings is currently facing challenges regarding its ability to continue as a going concern, with management expressing substantial doubt about its financial viability within the next year. The company is heavily reliant on raising additional capital through equity and debt financing, as well as collaboration agreements and research grants. As of September 30, 2024, the company recorded an excise tax liability of $3.1 million related to stock repurchases, further complicating its financial situation.