TIDMACTA
RNS Number : 7913S
Acta S.p.A.
29 September 2014
29 September 2014
Acta S.p.A. ("Acta" or "the Company")
Interim Results for the six months ended 30 June 2014
Acta S.p.A (AIM; ACTA), the hydrogen energy company, announces
its Interim Results for the six months ended 30 June 2014.
Financial Highlights
-- Total revenues of EUR304,000 (1H 2013: EUR238,000)
o Product sales of EUR302,000 (1H 2013: EUR231,000)
-- Operating loss of EUR1.7 million (1H 2013: EUR1.9 million loss*)
-- Operating cash outflow of EUR1.0 million (1H 2013: EUR0.8 million outflow)
-- Period end cash of EUR0.3 million (1H 2013: EUR1.1 million)
*Excluding reversal of share option expense of EUR2.4
million
Operational Highlights
-- Increasing volume of unit sales, at positive gross margins
-- Increase in repeat orders for electrolyser products from growing customer base
-- Expansion of production capacity to 40 electrolyser and back-up power units per month
-- First two Acta Power system sales for renewable energy storage in Thailand
-- Three Acta Power site evaluations successfully concluded for
back-up power for the telecom sector, one still in progress
-- Signed a strategic Marketing and Co-operation agreement with
ReliOn, a leading US fuel cell manufacturer
-- Successful launch of the Acta Power Cube, a 200W self-recharging fuel cell
-- Development of 23" rack-mounted electrolyser for the US market
-- Development of larger electrolyser stack to address the
significant industrial hydrogen market
Post Period End Highlights:
-- Repeat order for three Acta Power systems for major Australian mobile phone operator
-- Product development partnership with Dantherm Power A/S
(Ballard Group) for renewable energy storage in harsh
environments
-- Continuous back-up power successfully delivered by Acta Power
system in Cairo, Egypt during major regional electricity
black-out.
-- Successfully raised GBP2 million (gross) from existing and new shareholders
Robert Drummond, Chairman, said today: "During the first half of
2014, our flagship product, the Acta Power energy storage system,
proved itself repeatedly in demanding real-world conditions under
the watchful eyes of commercial customers.
"To achieve such a level of commercial and technical validation
only one year after the launch of this product has been
exceptional. It is testimony to the strength of our underlying
technology as well as to the dedication of our staff who have
worked under tight constraints to deliver these results.
"The sales of our electrolysers are also increasing in both
volume and value, and this further indicates the adoption of our
technology by our partners and their customers. We are also seeing
recognition of the commercial value of our technology on the part
of some of the leaders in the fuel cell and electrolysis industry,
through partnership requests and joint business proposals.
"Our strategy is first to address the telecom back-up power
sector as the fastest route to profitability, and thereafter to
expand into other hydrogen markets where our unique electrolyser
technology can offer key cost and performance advantages. We are
encouraged by our developments in the energy storage and fuel cell
vehicle refuelling sectors, and are investing in the development of
larger capacity electrolysers to widen our addressable market in
these applications and the industrial hydrogen market.
"Our next challenge is to close larger volume orders with the
major mobile phone operators which have been evaluating our
products over the last year, and we are pushing hard to conclude
these. This is likely to bring a step-change to the business,
providing further validation of our business proposition and
visibility for the next stage of our growth."
For Further Information, please contact:
Altium Capital (Nominated Advisor) Tel: +44 (0)845 505 4343
Adrian Reed / Dom Orsini
Cantor Fitzgerald Europe (Broker) Tel: +44 (0)20 7894 7000
Mark Percy / David Banks / Paul
Jewell
Walbrook PR (Media enquiries) Tel: +44 (0)20 7933 8780
Paul Cornelius / Nick Rome acta@walbrookpr.com
Chairman's Statement
Introduction
The first half of 2014 has seen the repeated validation of our
technology through successful live site evaluations in remote
locations and challenging environments.
This critical process has demonstrated that our technology is
robust, reliable and works well when installed in real-world
applications. It also proves that the efficiency and performance of
our systems is unmatched, despite the significant cost advantage of
our electrolysers over competing technologies.
The profile of the Company and its products has increased among
customers and current and potential commercial partners. Fuel cell
manufacturers are increasingly recognising that on-site hydrogen
generation can re-write the economic case for the adoption of fuel
cell solutions, avoiding the servicing and logistics barriers of
bottled hydrogen deliveries, particularly in remote locations. This
allows fuel cells to compete effectively with diesel generators and
battery systems, which frequently suffer limitations in performance
as well as high operating costs due to maintenance, servicing and
replacement requirements, fuel deliveries and theft.
The success of the Acta Power has therefore generated increased
interest from fuel cell manufacturers and system integrators in our
core technology, the electrolyser. As such, we have seen an
increase in electrolyser sales this year, particularly in larger
volume orders and repeat orders from our channel partners. We see
strong growth opportunities in developing our electrolyser range to
include larger systems in order to address the industrial hydrogen,
vehicle refuelling and renewable energy storage markets.
Financial review
For the six months ended 30 June 2014, the Company generated
turnover of EUR302,000 relating to product sales - compared to
product sales of EUR231,000 for 1H 2013, and EUR397,000 for 2013 as
a whole.
Total revenues for the period were EUR304,000 (1H 2013:
EUR238,000) including delivery charges and other income. No
revenues from technical services or other projects were recognised
in the period. Grant income of EUR25,000 (1H 2013: EUR19,000) was
recognised as a reduction of research and development costs.
An operating loss of EUR1,683,000 was registered for the period
(1H 2013: EUR1,851,000 operating loss, which becomes an operating
profit of EUR547,000 following the reversal of share option costs
for EUR2,398,000). The reduction in operating loss is due to lower
operating costs in the period compared to the first half of last
year when the Company was increasing its commercial and production
staff and facilities.
Operating cash outflow increased to EUR998,000 for the period
(1H 2013: EUR805,000 outflow) and benefited from favourable
movements in working capital. Cash and equivalents at the period
end were EUR344,000 (1H 2013: EUR1,070,000) following investing
activities of EUR668,000 relating to product development and
investments in plant and equipment (1H 2013: EUR634,000).
Commercial Review
Our commercialisation strategy has been to develop and launch an
integrated fuel cell and electrolyser system, the Acta Power, and
to sell this for back-up power and renewable energy storage
applications. This strategy has allowed us to address applications
that require a smaller volume of hydrogen production than is
typical for industrial electrolyser systems, which is a perfect
entry point for the compact electrolyser units that we have
developed to date.
Our success in these applications, as testified by the success
of customer live site trials and increasing product sales, has
underlined the commercial opportunity that we face in other
hydrogen applications, such as industrial hydrogen, large scale
renewable energy storage and fuel cell vehicle refuelling. We
believe that the low capital cost and high efficiency of our core
technology will also offer even greater competitive advantages at
large scale. As such, we are exploring opportunities to develop
larger systems together with partners.
Acta Power: the "Hydrogen Battery"
The Acta Power is an energy storage system that integrates
Acta's unique electrolyser technology with a fuel cell system,
coupled with an advanced remote monitoring, management and
servicing interface. The system has been designed to meet the needs
of the large and rapidly growing market for back-up power systems
for telecom base stations in remote, bad-grid and off-grid
locations in Asia, Africa and other emerging economies.
By generating its own hydrogen on site, the system avoids the
cost and logistical barriers of delivering bottled hydrogen to the
site. At EUR30,000 to EUR40,000 cost for a 4kW fuel cell power,
1m(3) /h hydrogen generating capacity system suitable for base
station applications, the capital cost is approximately half the
current selling price of comparable systems using a fuel cell and
standard PEM electrolyser. The low maintenance and service costs
make the system cost-competitive with battery or diesel systems
over a two to three year period, since the replacement cycle of
batteries and the frequent maintenance and refuelling requirements
of gensets can be avoided. In addition, the system offers a
significantly lower theft risk than these traditional solutions,
which is an important cost and service factor for remote
locations.
Since launch in 2013, the Acta Power has been under evaluation
by four major mobile phone operators located in Australia, Egypt
and the Philippines, where they have provided back-up power to the
live operations of mobile network base stations. With one trial
still continuing, three of these four trials have now been
concluded. In each case, the system performed to the customer's
satisfaction, and in one case far beyond the customer's
specifications.
In July 2014, following the conclusion of the system evaluation
in Australia, three further Acta Power systems were sold to our
Australian distribution partner for installation with an unnamed
mobile operator. During the first half of 2014, Acta has also been
developing a partnership signed in February 2014 with ReliOn Inc, a
major US fuel cell manufacturer, to address opportunities in the US
telecom back-up power market, where ReliOn is currently the market
leader.
Confirmation of the robustness of the Acta Power system was seen
in September 2014 when the system installed on a base station in
the Cairo region provided continuous power throughout a major
regional black-out which Vodafone, the leading mobile operator in
the country, reported had taken down 2,000 base stations across the
area.
Although the process of evaluation and product adoption for new
technologies in the telecoms sector is slow, the Company has seen
an increase in opportunities for growth in the telecom back-up
power market, where the Acta Power provides higher performance and
lower total cost of ownership than traditional back-up power
systems, especially in remote or off-grid locations.
The small system footprint and clean, reliable performance of
the Acta Power is also ideal for distributed renewable energy
storage applications, e.g. for off-grid communities storing solar
power for night-time use, for remote locations where surplus
renewable energy cannot be fed into the electricity grid, and for
environmentally sensitive locations where diesel generators are not
desirable. Three Acta Power systems have been sold in Singapore and
Thailand for renewable energy storage, and the Company is
addressing a number of opportunities to supply this solution in
large quantities for off-grid communities and remote locations.
Electrolyser Systems
Sales of the Company's electrolyser systems have grown strongly
during the first half of 2014, supported by larger repeat orders
from our largest customers.
M-Field Energy Ltd, a telecom back-up power fuel cell system
integrator based in Taiwan, ordered 15 electrolyser systems in May
2014, plus two smaller units, following an order of six systems in
October 2013, and has indicated further repeat orders within the
year. Heliocentris, the renewable energy solutions supplier to the
education sector, placed an order for ten of Acta's 500L/hr
electrolyser stacks in June 2014, following numerous previous
orders received since 2012.
In July 2014, the Company agreed a product development
partnership with Dantherm Power A/S, part of the Ballard group, to
integrate its electrolyser system with Dantherm's fuel cell for
renewable energy storage and back-up power applications in cold
environments. An initial electrolyser system has been sold to
Dantherm for a wind energy storage application in a remote cold
location, and the partners intend to pursue a number of
opportunities in the Nordic and other regions together during
2015.
The Company's electrolyser is also being used for a renewable
energy storage application in a trial in Cheshire incorporating a
20kW wind turbine, and a number of similar opportunities are being
explored at a larger scale within the UK wind sector.
Fuel cell vehicle refuelling applications are also continuing to
provide opportunities for the Company's electrolyser products,
particularly in the fuel cell scooter, fork-lift truck and small
fuel cell vehicle fleet sectors. In addition to shipping further
products to its partner APFCT in Taiwan during the first half of
2014, Acta has been addressing a number of new opportunities for
refuelling systems for small fuel cell electric vehicle fleets.
Product Development
Product development during 2013 focused on the development of
the Acta Power system and the subsequent simplification of the
design towards a modular structure to reduce system cost and
assembly time. During 2014, the Company has focused on mounting its
electrolyser module on a 23" rack, the standard configuration for
the US market; the development of the 200W Acta Power Cube system;
and moving its electrolyser technology platform up in scale towards
a 10m3/hr hydrogen production capacity to address the significant
industrial hydrogen market opportunity.
Good early progress has been made in this development, with the
completion of a larger capacity electrolyser stack in February
2014. This has achieved double the capacity and a greater operating
efficiency than the largest stack currently produced by the
Company. Further time and investment will be required to arrive at
the target of a 10m3/hr electrolyser system, suitable to address a
wide range of industrial hydrogen and other market opportunities.
The Company is, however, confident that there are no engineering or
other technical barriers to scaling up its product range.
Grant-Funded Projects and Research Services
The Company received EUR12,000 in grant funding during the
period (1H 2013: EUR189,000 grant funds received) and recognised a
total of EUR25,000 in grant income as a reduction in costs in the
period (1H 2013: EUR19,000 cost reduction). The Company is engaged
in a number of Italian and EU grant-funded research activities,
including the Hydrostore and Alkammonia projects, from which up to
EUR972,000 of further grant funding is expected to be received over
the next two years.
Outlook
The Acta Power system was launched a little over one year ago,
and the adoption of new technologies in new markets understandably
takes time. However, we believe that the combination of our
proprietary patented technology, outstanding technical performance,
cost leadership and enormous addressable markets is compelling, and
will drive our financial performance and the value of the business
going forward.
We believe that the introductory stage of Acta Power evaluation
with the telecom back-up power sector is drawing to a close, and
has served two purposes: to open a channel into a customer base of
very large mobile network operators, which represents a significant
end user market for our Acta Power systems; and to demonstrate the
capabilities and performance of our electrolyser technology
platform to fuel cell manufacturers and system integrators in real
world applications.
This success of the trials has therefore generated increased
sales of our electrolysers in the first half of 2014, through
indirect channels, into back-up power and energy storage
applications. We intend to capitalise upon this through support of
these channel partnerships, together with the continued development
of larger electrolyser systems for industrial hydrogen, renewable
energy storage and vehicle refuelling applications.
We will also exploit the success of our entry into the telecom
back-up power sector through concluding larger installation
contracts and further opportunities currently under negotiation. We
believe that this combination of addressable markets, end user
sales and commercial partnerships with the fuel cell industry's
leading players will provide the Company with multiple growth
opportunities over the next few years and will serve to demonstrate
the exceptional underlying value of Acta's unique technology
platform.
We therefore remain very optimistic about the Company's future,
continue to trade in-line with market estimates, and remain
focussed on delivering significant shareholder value in the near
future.
Condensed consolidated statement of comprehensive income
Unaudited Unaudited Audited
Six months Six months Year ended
ended ended
30 June 2014 30 June 2013 31 December
Notes 2013
EUR'000 EUR'000 EUR'000
Revenue 304 238 411
Raw materials and consumables
used (137) (58) (147)
Personnel expense (898) (908) (1,673)
Share Option Costs reverse
previous years 0 2,398 2,398
----------------------------------- ---------- ----------------- ----------------------------- ----------------
Total Personnel expense (898) 1,490 725
Depreciation and amortisation
expense (121) (157) (295)
Other operating expenses (831) (966) (1,834)
----------------------------------- ---------- ----------------- ----------------------------- ----------------
Result from operations (1,683) 547 (1,140)
Financial income 8 8 17
Financial expenses (41) (39) (77)
----------------------------------- ---------- ----------------- ----------------------------- ----------------
Result before tax (1,716) 516 (1,200)
Current tax credits 0 0 (12)
Result for the period (1,716) 516 (1,212)
----------------------------------- ---------- ----------------- ----------------------------- ----------------
Attributable to:
Equity holders of the parent (1,715) 520 (1,207)
Minority interest (1) (4) (5)
----------------------------------- ---------- ----------------- ----------------------------- ----------------
(1,716) 516 (1,212)
----------------------------------- ---------- ----------------- ----------------------------- ----------------
Basic earnings per share
(euro cents) 3 (1.01) 0.37 (0.83)
Diluted earnings per share 3 (1.01) 0.37 (0.83)
Condensed consolidated statement
of financial position
Unaudited Unaudited Audited
30 June 2014 30 June 31 December
2013 2013
ASSETS EUR'000 EUR'000 EUR'000
Non-current assets
Property, plant and equipment 948 1,019 982
Intangible assets 2,719 1,625 2,130
Fixed asset investment 0 6 0
------------------------------------------- ------------------ -------------- -----------------
Total non-current assets 3,667 2,650 3,112
------------------------------------------- ------------------ -------------- -----------------
Current assets
Inventories 734 416 738
Trade and other receivables 1,094 1,683 1,061
Cash and cash equivalents 344 1,070 2,086
------------------------------------------- ------------------ -------------- -----------------
Total current assets 2,172 3,169 3,885
------------------------------------------- ------------------ -------------- -----------------
Total assets 5,839 5,819 6,997
------------------------------------------- ------------------ -------------- -----------------
EQUITY AND LIABILITIES
Equity attributable to equity holders
of the parent
Share capital 1,023 843 1,023
Capital reserve 33,327 31,204 33,281
Retained losses (35,161) (31,739) (33,445)
------------------------------------------- ------------------ -------------- -----------------
(811) 308 859
Non controlling interests 6 5 5
------------------------------------------- ------------------
Total equity (805) 313 864
------------------------------------------- ------------------ -------------- -----------------
Non-current liabilities
Employee benefits - non current 318 237 283
Long-term provisions 1,447 1,047 1,292
Long-term borrowings 1,085 1,146 1,147
------------------------------------------- ------------------
Total non-current liabilities 2,850 2,430 2,722
------------------------------------------- ------------------ -------------- -----------------
Current liabilities
Short-term borrowings 160 153 174
Trade and other payables 3,634 2,923 3,237
------------------------------------------- ------------------
Total current liabilities 3,794 3,076 3,411
------------------------------------------- ------------------ -------------- -----------------
Total liabilities 6,644 5,506 6,133
------------------------------------------- ------------------ -------------- -----------------
Total equity and liabilities 5,839 5,819 6,997
------------------------------------------- ------------------ -------------- -----------------
Condensed consolidated
statement
of cash flows
Unaudited Unaudited
Six Month Six Month Audited
ended ended Year ended
31 December
30 June 2014 30 June 2013 2013
Cash flows from
operating activities EUR'000 EUR'000 EUR'000
Result for the year (1,715) 516 (1,207)
Adjustments for:
Amortisation of
tangible assets 65 101 183
Amortisation and
depreciation of
intangible assets 56 55 111
Impairment of
intangible assets 0 0 1
Allowance for future
risks 155 (261) (16)
Share option Costs
reverse previous
years 0 (2,398) (2,398)
IFRS recognition of
severance pay
(TFR) 0 0 (41)
Expense recognised in
profit or loss
in respect of share
based payments 49 0 49
Foreign currency
translation reserve (3) 0 (1)
Net finance income 33 31 60
(Increase) decrease in
trade and
other receivables (33) 1,141 1,763
(Increase) decrease in
inventories 4 (289) (611)
Increase in trade and
other payables 397 317 631
Increase in provisions
and employees'
benefits (TFR) 35 21 67
Cash outflow from
operations (957) (766) (1,409)
Interest paid (41) (39) (77)
Net cash from operating
activities (998) (805) (1,486)
---------------------------- ---------------------------------- ---------------------------------- ----------------
Cash flows from
investing activities
Interest received 8 8 17
Payments for property,
plant and
equipment (31) (115) (162)
Proceeds from sale of
property, plant
and equipment 0 73 72
Proceeds from available
for sale
investments 0 0 5
Payments for intangible
assets (645) (600) (1,160)
Net cash used in
investing activities (668) (634) (1,228)
---------------------------- ---------------------------------- ---------------------------------- ----------------
Cash flows from
financing activities
Proceeds from issue of
share capital
(gross value) 0 0 2,465
Paid capital increase
December 2012 0 2,395 2,395
Proceeds from minority
interest 1 10 5
Payment for share issue
costs 0 0 (193)
Proceeds from
borrowings (49) (51) 82
Repayment of borrowings (12) (2) (94)
Payment of finance
lease liabilities (16) (21) (38)
Net cash (outflow)
inflow from financing
activities (76) 2,331 4,622
---------------------------- ---------------------------------- ---------------------------------- ----------------
Net (decrease) increase
in cash and
cash equivalents (1,742) 892 1,908
Cash and cash
equivalents at the
beginning of the
financial year 2,086 178 178
Cash and cash
equivalents at the
end of the financial
year 344 1,070 2,086
---------------------------- ---------------------------------- ---------------------------------- ----------------
Notes to the interim financial statements
for the six months ended 30 June 2014
1. Basis of
preparation
The financial statements have been prepared using accounting policies
consistent with International Financial Reporting Standards and in accordance
with International Accounting Standard (IAS) 34 Interim Financial Reporting.
2. Principal
accounting
policies
The financial statements have been prepared under the historical cost
convention. The same accounting policies, presentation and methods of
computation are followed in these financial statements as were applied
in the preparation of the Group's financial statements for the year
ended 31 December 2013.
3. Result per
share
The calculation is based on information in
the table shown below:
Six months Six months Year ended
ended 30 ended 30 31 December
June 2014 June 2013 2013
(unaudited) (unaudited) (audited)
EUR'000 EUR'000 EUR'000
Result (1,715) 516 (1,207)
-------------------------- --------------- ------------------ ------------------- ---------------------- ---------------------------- ------------------------
Weighted average number of shares 170,431,939 140,431,939 145,938,788
------------------------------------------- ------------------ ------------------- ---------------------- ---------------------------- ------------------------
In accordance with IAS 33.41, the potential ordinary shares have not
been treated as dilutive because their conversion to ordinary shares
would decrease loss per share for the period.
4. Statement of
changes
in equity
IFRS Adj
Share Reserve Retained Minority Shareholders Total
Capital Capital Earnings Interest receivables
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------- ------------------ ------------------- ---------------------- ---------------------------- ------------------------
Balance at 1 January
2013 842 33,602 (32,255) (4) (2,395) (210)
Paid capital increase 0 0 0 0 2,395 2,395
Result for the period 0 0 516 4 0 520
Share Option Costs
reverse
previous years 0 (2,398) 0 0 0 (2,398)
Share Capital and
Minority
Interest 1 0 0 5 0 6
-------------------------- --------------- ------------------
Balance at 30 June
2013 843 31,204 (31,739) 5 0 313
-------------------------- --------------- ------------------ ------------------- ---------------------- ---------------------------- ------------------------
Balance at 1 January
2014 1,023 33,281 (33,445) 5 0 864
Result for the period 0 0 (1,716) 1 0 (1,715)
Share based payment 0 49 0 0 0 49
Foreign Currency
Translation
Reserve 0 (3) 0 0 0 (3)
-------------------------- ---------------
Balance at 30 June
2014 1,023 33,327 (35,161) 6 0 (805)
-------------------------- --------------- ------------------ ------------------- ---------------------- ---------------------------- ------------------------
5. Board
The financial information for the period 1 January 2014 to 30 June 2014
is unaudited although it has been reviewed by the Company's audit committee.
In the opinion of the Directors the financial information for this period
presents fairly the position, results of operations and cash flows for
the period. The interim report for the six months ended 30 June 2014
was approved by the Directors on 26 September 2014.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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