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VSA Capital Market Movers - Invinity Energy Systems

Published: 10:06 16 Jul 2020 BST

Capital Limited - VSA Capital Market Movers - Invinity Energy Systems

Invinity Energy Systems#: Full Year Results 2019

Performance on Track

The Group has today announced Full Year results for the period ending December 31st, 2019. The financial numbers reported are primarily for previously AIM listed redT energy (LON:RED). RED merged with US-based Avalon Battery in April 2020 to create Invinity Energy Systems plc (IES LN). An equity fund raising of £8.0m was also undertaken in April 2020 for the new combined entity. IES is seeking to achieve scale in battery storage markets for utility, industrial and commercial applications. IES issued a Trading Update on June 15th, 2020 and VSA Capital initiated full research coverage on 30 June 2020.

Growth Opportunity

The £8.0m raised through the issue of new shares was to fund development of IES including investment in R&D, marketing and also working capital to increase volume to meet an identified project pipeline of just over 4,000 units (circa 161MWh). We estimate unit volumes to rise to 1,250 in 2021 and 3,200 in 2022, driving revenues of £21.2m and £52.2m. 

Breadth of Applications

The IES Vanadium Flow Battery (VFB) has been designed to provide a standardised module that can be produced in high volume. There are already over 160 in use. In the June 2020 Trading Update, the Group announced that since the beginning of 2020, it has received orders for 1.7 MWh of its VFBs, comprising 40 VFB modules. The anticipated revenue contribution of these sales, according to IES, is approximately £1.1m including the VFBs themselves, ancillary components and related services. The recent business wins reflect breadth of markets with orders secured from a global retailer, U.S. municipal utility and leading Asia-based energy storage project developer.   
 

Phil Smith, Equity Analyst, Alternative Energy | T: +44 (0)20 3617 5187 | E: psmith@vsacapital.com

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