In the year to the end of July, the group added to its pipeline of commercial opportunities, while remaining carefully focused on its core target market sectors of paints and coatings, composites and functional fluids, where it believe its graphene formulation know-how can add most value.
Paints and coatings
In the paints and coatings division, the company is currently working with James Briggs, one of Europe’s largest consumer chemicals businesses, on an accelerated product development programme incorporating Applied Graphene’s materials into several of James Briggs’s existing products.
“We are currently working with James Briggs to determine the optimum format that we should supply the material in and exactly what that means in terms of production volumes for the group,” Applied Graphene revealed. The first of the products being developed is expected to go on sale early next year.
Sherwin-Williams, the world’s largest supplier of paints, is testing out graphene in their paint formulations in conjunction with Applied Graphene. Revenues from this collaboration are likely to be small in 2017, but the relationship has the potential to increase volumes to the extent that Applied Graphene would have to invest in substantial investment capacity.
Composites and functional fluids
On the composites side, the company’s efforts have been focused on improving mechanical strength of materials.
During 2016 Applied Graphene Materials commenced the exploratory phases of a development programme with Airbus Defence and Space. The programme work is covered under a non-disclosure agreement but is targeted at using the unique properties of graphene in satellites.
Initial development work has been successful and both parties are optimistic of moving quickly to a product development programme in 2017, with product adoption soon after.
Applied Graphene Materials has also been developing its knowledge base concerning the deployment of graphene into bulk polymers and resins, and consistent with the company’s business model, it is working alongside a select number of industrial and consumer brands.
A range of plastics has been demonstrated to be capable of enhancement by the addition of a small amount of graphene, the company said.
On the functional fluids side, the company has, since October 2015, been working with Puraglobe to understand how its graphene can best be incorporated into Puraglobe’s products. This has progressed to a point where tripartite agreements are being formed, particularly with metalworking and cutting fluids companies but also adjacent market companies.
P&L and outlook
As is common with technology companies at this stage of development, the company is currently loss-making.
In the full-year it made a loss before tax of £4.5mln, versus a loss the previous year of £4.0mln.
Total revenues rose to £75,000 from £41,000 the year before, arising from the supply of evaluation quantities of graphene to commercial partners.
Cash at the end of the reporting period stood at £7.7mln, up from £4.7mln a year earlier.
“The achievement of our first production orders gives the board confidence that our strategic approach to the commercialisation of graphene is effective and on track. Our focus on supplying formatted graphene to our customers such that they can adopt this readily into their production processes and benefit from the performance enhancements in their existing markets is beginning to bear fruit,” said chief executive officer, Jon Mabbitt.
“Graphene has the potential to be a disruptive technology and we are targeting applications where graphene can be incorporated with minimal change to production processes. We believe this to be the most expeditious route to market. The depth of our customer engagements is setting the foundations for a long term, stable and highly attractive business. Our intent remains to become a global graphene market leader and the board believes that Applied Graphene Materials remains well placed to meet its ambition,” he added.