Full-year results from fuel cell developer Ceres Power Holdings PLC (LON:CWR) showed strong growth in revenue and a burgeoning order book.
The year to 30 June was one in which the company secured three new partnerships with big name companies.
“Honda, Nissan and Cummins are market leaders in their respective fields, and we are engaged with them all in developing different applications using the SteelCell [fuel cell platform],” said Alan Aubrey, in his chairman’s statement.
Since the end of the reporting period the company has been buoyed by its first significant US commercial success with Cummins & the US Department of Energy to develop multi-kilowatt systems for data centre and commercial scale applications, and the release, on time and on budget, of version four of its SteelCell platform.
Aubrey noted data and cloud computing now accounts for around 2% of the world's electrical power generation, and is sure to rise significantly, while poor air quality in cities is leading to a desire to reduce carbon and harmful emissions and adopt cleaner, electric vehicles.
The above factors represent a “huge opportunity” for a business such as Ceres, Aubrey said.
The focus in the current year will be on moving its partners on from the development stage to the point where Ceres can negotiate commercial terms for the production and commercialisation of products using the SteelCell technology.
“Last year I stated that our target was to have five OEMs [original equipment manufacturers] working on development programmes with the SteelCell technology within two years. We are on track to meet this, with three significant relationships secured this year, putting us on the path to commercialisation,” said chief executive Phil Caldwell.
Revenue and other income (mainly government grants) in the financial year just ended rose to £1.7mln from £945,000 the year before. Of this, £1.1mln was customer revenue, up from £324,000 the previous year.
The company said customer revenue this time round included some £0.6mln in deferred revenue in respect of contracted work for British Gas.
Net cash and short term investments at the end of June had fallen to £6.95mln from £18.18mln a year earlier, but since then the company has raised £20mln through a placing of shares that was at a very modest discount to the prevailing market price.
“This year's equity free cash outflow of £11.3 million will be the peak, as we anticipate seeing an increasing contribution from commercial programmes offsetting our operating costs,” said Caldwell.
The company said its customer and government grant book already exceeds £2mln, which bodes well for the future.
“As we increase our number of customers, and they progress from evaluation to product development and then to commercial launch, we anticipate each progression will increase the revenue contribution, reducing our underlying cash burn year on year towards break-even,” Caldwell said.