Westwater Resources, Inc. Announces Results for Second Quarter Ended June 30, 2022

Company Receives Air Permit from Alabama Department of Energy Management

Company Completes Earthwork at Kellyton Graphite Processing Plant Site

Westwater Resources, Inc. (NYSE American: WWR), an energy technology and battery-grade natural graphite development company (“Westwater” or “the Company”), today announced its second quarter results for the period ended June 30, 2022 and provided an update on its Kellyton graphite processing plant currently under construction in east-central Alabama.

During the second quarter of 2022, Westwater continued construction activities related to Phase I of its Kellyton Graphite Plant, including earthwork and site grading, which was completed in July 2022. The Company moved approximately 97 thousand cubic yards of dirt during earthwork and site grading.

Construction activity during the second quarter also included the mobilization of the general contractor, receipt of the first components of long-lead equipment, and beginning work on underground utilities, foundations, and the manufacturing of plant buildings.

Also in June 2022, the Company received its air permit from the Alabama Department of Environmental Management and now has all necessary permits to complete the construction of phase I of the Kellyton Graphite Plant.

“Our team not only continues to work diligently and progress the construction of Phase I of our Kellyton graphite plant but has done so without a recordable safety incident since the beginning of the project,” said Chad Potter, President and CEO. “We continue, with the world class construction management team we’ve assembled and our team at Westwater, to progress the construction of Phase I despite continued supply chain disruptions and challenges. We continue to work to mitigate the supply chain pressures and are targeting to begin commissioning of Phase I by the end of the second quarter in 2023.”

In June 2022, the Company announced the retirement of its Chief Financial Officer (CFO) and Vice President - Finance, Jeffrey L. Vigil, effective August 26, 2022. Chief Accounting Officer Steven M. Cates, who has been with Westwater since May 2021, has been elected Westwater’s new CFO and Vice President – Finance, also effective August 26, 2022. Mr. Cates’s appointment is the result of a planned succession strategy dating back to 2021.

“We finished the second quarter with a cash balance of $109.0 million and a working capital balance of $102.7 million,” said Mr. Vigil. “Since beginning construction of Phase I of the Kellyton graphite plant in the fourth quarter of 2021, we have incurred approximately $30.0 million of costs, of which $27.5 million represents cash expended with the remainder remaining on the Company’s balance sheet as liabilities as of June 30, 2022.”

After the close of the second quarter, Westwater executed a letter of intent with a global manufacturer of consumer batteries (“Manufacturer”) under which Westwater committed to support the Manufacturer’s consumer battery programs by providing its PMG product (from the Kellyton graphite processing facility once operational), and the Manufacturer committed to evaluate the product in its official qualification programs.

Financial Summary

* Presented on a year-to-date basis.

• Net cash used in operations was $3.2 million lower for the six months ended June 30, 2022, compared to the same period in 2021. The decrease in cash used in operations was due primarily to lower product development expenses and arbitration costs.
• Net cash used in investing activities increased by $25.1 million for the six months ended June 30, 2022, compared to the same period in 2021. The increase was due primarily to capital expenditures related to the construction of Phase I of the Kellyton graphite plant. The capital expenditures in the first six months of 2022 were primarily related to: earthwork and site grading, which was completed in July 2022; progress payments related to long-lead equipment items; detailed design engineering, and project management activities.
• Net cash provided by financing activities decreased $53.2 million during the six months ended June 30, 2022, compared to the same period in 2021, due to lower sales of shares under our equity financing facilities. During the first half of 2022, the Company sold 11.8 million shares of common stock for net proceeds of $24.5 million pursuant to our Controlled Equity Offering ^SM Sales Agreement with Cantor Fitzgerald & Co (“ATM”). Of the shares sold during the first half of 2022, 4.4 million shares were sold in the first week of April 2022 for net proceeds of $9.0 million. The Company’s ATM has been inactive since this first week of April 2022.
• Product development expenses for the three months ended June 30, 2022, decreased $1.7 million compared to the same period in 2021. Product development costs for the second quarter of 2022 were related to continued product development and optimization costs: prior-year period expenses were related to the Definitive Feasibility Study for Phase I of the Kellyton graphite processing facility and the Company’s pilot program, both of which were completed in the second half of 2021.
• General and administrative expenses for the three months ended June 30, 2022, increased by $0.4 million compared to the same period in 2021. The increase quarter over quarter is due primarily to higher personnel costs as the Company continues to build out its Kellyton team.
• Consolidated net loss for the three months ended June 30, 2022, was $3.2 million, or $0.07 per share, compared to a net loss of $3.5 million, or $0.11 per share, for the same period in 2021. The $0.3 million reduction in net loss was due primarily to lower product development and exploration costs; partially offset by no unrealized gain on equity securities, which were sold in the fourth quarter of 2021, and an increase in general and administrative expenses during the current quarter.
• Cash and working capital as of June 30, 2022, were $109.0 million and $102.7 million, which represent respective decreases of $6.3 million and $7.6 million, compared to December 31, 2021. The decreases in cash and working capital were due primarily to capital expenditures of $25.8 million and cash used in operations of $5.0 million; these capital expenditures were partially offset by cash proceeds received from the financing activities as discussed above.

Conference Call

Management will host a conference call to discuss these results on August 11, 2022, at 11:00 AM EDT (9:00 AM Mountain).

The dial-in numbers are:

Canada/USA TF: 1-800-319-4610

International Toll: +1-604-638-5340

Callers should dial in 5-10 min prior to the scheduled start time and simply ask to join the call.

A live webcast of the conference call presentation will also be available at www.westwaterresources.net

For a replay of the call:

Canada/USA TF: 1-855-669-9658

International Toll: +1-412-317-0088

Replay Access Code: 9184

About Westwater Resources, Inc.

Westwater Resources, Inc. (NYSE American: WWR), an energy technology company, is focused on developing battery-grade natural graphite. The Company’s primary project is the Kellyton graphite processing plant that is under construction in east-central Alabama. In addition, the Company’s Coosa graphite deposit is the most advanced natural flake graphite deposit in the contiguous United States — and located across 41,900 acres (~17,000 hectares) in Coosa County, Alabama. For more information, visit www.westwaterresources.net.

Cautionary Statement Regarding Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as "expects," "estimates," "projects," "anticipates," "believes," "could," “scheduled,” “targets” and other similar words. Forward looking statements include, among other things, statements concerning the construction and operation of the Company’s Kellyton graphite processing facility, the Company’s Coosa graphite deposit, and the costs and schedules associated with them. The Company cautions that there are certain factors that could cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of the Company; accordingly, there can be no assurance that such suggested results will be realized. The following factors, in addition to those discussed in Westwater’s Annual Report on Form 10-K for the year ended December 31, 2021, and subsequent securities filings, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: (a) the spot price and long‑term contract price of graphite (both flake graphite feedstock and purified graphite products) and vanadium, and the world-wide supply and demand of graphite and vanadium; (b) the effects, extent and timing of the entry of additional competition in the markets in which we operate; (c) the ability to obtain contracts with customers; (d) available sources and transportation of graphite feedstock; (e) the ability to control costs and avoid cost and schedule overruns during the development, construction and operation of the Kellyton graphite processing facility; (f) the ability to construct and operate the Kellyton graphite processing plant in accordance with the requirements of permits and licenses and the requirements of tax credits and other incentives; (g) effects of inflation; (h) the availability and supply of equipment and materials needed to construct the Kellyton graphite processing facility; (i) stock price volatility; (J) government regulation of the mining and manufacturing industries in the United States; (k) unanticipated geological, processing, regulatory and legal or other problems we may encounter; (L) the results of our exploration activities at the Coosa graphite deposit, and the possibility that future exploration results may be materially less promising than initial exploration results; (m) any graphite or vanadium discoveries at the Coosa graphite deposit not being in high enough concentration to make it economic to extract the metals; (n) our ability to finance growth plans; (l) the potential effects of the continued COVID-19 pandemic; (o) currently pending or new litigation or arbitration; and (p) our ability to maintain and timely receive mining, manufacturing, and other permits from regulatory agencies.

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