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Aggregated Micro Power posts sharp rise in first-half revenue

The first half of the year is generally the quieter period for AMP, as its heating business really comes to life over the colder winter months
wood chip
AMP delivered over 80,000 tonnes of wood pellet and wood chip in the first half

Renewable fuels provider Aggregated Micro Power Holdings PLC (LON:AMPH) has posted a sharp rise in first-half sales and gross profits.

Still, AMP delivered over 80,000 tonnes of wood pellet and wood chip to nearly four million customers during the period. It also provided service and maintenance to around 900 biomass boilers.

READ: Aggregated Micro to raise £8.5mln

For the six months ended 30 September, group revenue rose 55% to £17.4mln (H1 17: £11.2mln), while gross profit increased by 22% to £3.3mln (H1 17: £2.7mln).

Loss after tax rose to £3.5mln (H1 17: £2.4mln). Net assets at the end of the period totalled £14.4mln (H1 17: £18.1mln).

“Group revenues have grown significantly year on year and our balance sheet has been simplified and strengthened by the recent equity fund raise and the conversion of loan notes into equity,” said chief executive Richard Burrell.

“With our growing pipeline of Urban Reserve projects, the strength of our position in the wood fuels market and with the winter heating season now upon us, we look forward to the remainder of the financial year with confidence.”

The first half tends to be quieter for the AIM company, with the heating season at its busiest over the winter months.

On top of that seasonal boon, AMP’s project development business expects to reach financial close on a number of projects during the second half.

Company on track to exceed £50mln revenue

In a note to clients, analysts at ‘house’ broker finnCap said: “Interim results confirm a step up in activity, with losses reflecting the usual summer seasonality in Wood Fuels as well as a lower level of completions in the company’s Project Development business. Winter trading combined with a streamlined operating brand will see a stronger H2 in Wood Fuels, and a stronger pipeline of completions in H2 is also expected in Developments.”

They added: “As such, trading is on track to exceed £50mln of revenue. Following the £8.5mln placing and conversion of CLNs, the balance sheet has been simplified and strengthened, with a year-end net cash forecast of £4.7mln”.

finnCap repeated a 135p target price on the stock, with AMP shares currently trading at 102.50p, steady on Wednesday’s closing price.

 -- Adds analyst comment, share price --

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