Ceres Power Holdings PLC (LON:CWR) said it has completed a £181mln fundraising through both a placing and subscription in order to accelerate the development of its hydrogen electrolysis and fuel cell technology.
The AIM-listed firm said following strong investor demand it had placed around 8.9mln shares at a price of 1,060p each, a 4.3% discount to its closing price on Wednesday, while existing operational partners and shareholders, engineering giant Bosch and Chinese engine maker Weichai Power, have agreed to subscribe to around 3.65mln and 4.1mln new shares at the same price.
READ: Ceres Power revenues ahead of target as fuel cell production scales up
The company said certain Ceres directors had subscribed to 24,376 shares and a retail offer had been launched through the PrimaryBid platform that had seen investors subscribe for 377,358 shares.
In total, the company said around 17.07mln new shares will be issued pursuant to the fundraising.
Announcing the fundraising plans after Wednesday’s close, Ceres said part of the proceeds will be used to invest in its core business and maintain its technology leadership across solid oxide electrolysis (SOEC) and fuel cells, as well as expanding its research & development engineering and advanced manufacturing capabilities.
The firm also said the proceeds will provide further capital for intellectual property generation and acquisitions, as well as enhancing its testing capability and infrastructure to potentially expand pilot production.
Part of the cash raised will also be used for general working capital purposes to cover the increased operating cost base of the larger business, with plans to move up to a premium listing on the London Stock Exchange main market by mid 2022.
"Ceres is a leader in solid oxide technologies aimed at delivering cleaner energy to the world. We are on the way to establishing our fuel cells as an industry standard, supporting our manufacturing partners as they scale up to initial mass market launches in 2024. Raising additional funds now allows us to develop our business into new market sectors from the same technology base and with the same high margin licensing model as our power system activities,” Ceres chief executive Phil Caldwell said in a statement.
“We see high potential for our SOEC technologies aimed at industrial processes that are carbon intensive and difficult to abate, significantly expanding future royalty revenues for Ceres. There are also attractive growth opportunities in higher power generation applications and in future fuels. These investments position us well to take advantage of valuable future opportunities in the energy transition," he added.
Revenues rise in 2020
In another separate release after Wednesday’s close, Ceres reported final results for the 18 months ended 31 December.
On a comparable calendar-year basis, turnover for the 12 months ended 31 December 2020 increased 15% to £21.9mln.
At the end of December, the company had strong cash and investments of £110mln after previous equity investment by Bosch and Weichai of £49mln.
Adjusted earnings (EBITDA) losses came to £11.4mln over the 18-month period, while gross profit was £21.3mln.
Looking ahead, the company highlighted its £54,3mln order book and a “strong pipeline” of £44.4mln at the end of 2020, adding that it is seeing “good momentum in the business” and that it is “well positioned to provide clean energy technology into multiple applications across society”.
"The urgency for climate action continues to drive the global demand for clean energy technologies, and our strategy of licensing to global partners, with a leading position in their products and markets, continues to be highly successful. Despite the disruption from COVID we have delivered a solid set of results, with continued revenue growth and sector leading margins. This is driven by good progress with our customer programmes and increased manufacturing output,” Caldwell said.
“Ceres has established itself as world leader in solid oxide technology and with the recent fundraising we intend to capitalise on recent progress by accelerating our activity in key areas such as electrolysis for green hydrogen and expansion of our power systems business into new applications and markets to meet global demand for our technology to enable a net zero future,” the CEO added.