Haydale Graphene Industries PLC (LON:HAYD) Chief Executive Officer Ray Gibbs caught up with DirectorsTalk for an exclusive interview to discuss their latest trading update
Q1: In the trading update, it’s good to see the group is trading in line with market expectations and that revenues have doubled on the prior year. Can you provide further detail on why the losses have widened marginally?
A1: We’ve made some significant investments into our Thailand operation, we’ve put a reactor in and fitted out a suite of laboratories over there. We’ve got some new projects and R&D going on over in Thailand and it’s servicing the rest of the Far East businesses where we’re driving for sales and profit so that’s good.
Haydale have got an operational CEO into America, we bought a business in November last year, and a Sales Director and that’s already paid off with new sales orders of $2.6 million which we announced in March so all good news.
The other thing to bear in mind as well, talking of America, is this thing called negative goodwill which is in the trading update. Really, that means we bought the business in America for less than its net asset value so there’s a benefit going back into the profit loss account which is good news.
Q2: What’s the rationale behind Haydale establishing the Strategic Business Units?
A2: Focus, focus, focus. We’ve got new products, we’ve got a pre-impregnated carbon fibre which is in the composites strategic business unit, we’ve got silicon carbide and we’ve got inks and pastes, particularly in the biomedical field now which is focussed in the advanced material section. So, we’ve got a Managing Director in both SBU’s, all have technical support individually there as well and Sales Directors too so it’s focussing on getting the products into the marketplace and driving for sales.
Q3: Now the Far East, it’s clearly central to Haydale Graphene’s ongoing strategy, what are your principal interests in Asia?
A3: They’re primarily driven by the very active screen printing biomedical sensor section, we’ve got some ongoing trials running with biomedical self-diagnostic diabetes sensors, which is a massive potential market, in the billions of dollars. It’s a great cost base for ongoing research, development and delivery of sales into the Far East so we see that as a significant life forward for us going on in terms of our sales drive.
Q4: Haydale has announced a number of new appointments over the last month, what do they all bring to the business?
A4: Ok, so Keith Broadbent who is now going to take over as the MD of the strategic business unit for the composites side, ex-Sunseeker Princess Yachts where he ran the production side so steeped in composites himself. His remit is to drive and bring the 2 units together in the United Kingdom, drive forward and grow the composites because we’ve not got pre-impregnated carbon fibre and a range of other things so that’s his role.
Of course, we’ve got David Banks who’s just joined us from Cantor Fitzgerald, the broker, David knows our shareholder base intimately plus he also knows us very well having been our corporate financier for a while. We look forward to bringing him through and he’s joined now and he’s excited by what we’ve got.
Finally, we also added a part time role from one of our non-execs, Roger Smith, who’s looking at doing some ongoing business development work, principally in the composites sector so lots of added oomph to get things moving for Haydale Graphene as a business as we transition from R&D into product sales.
Q5: Now, we know that the Huntsman collaboration is ongoing, can you provide us with an update there?
A5: I said in the trading update that it’s taken longer than either side predicted, we’ve learned a lot going forward with the mixing and dispersions in the resins, they’re ongoing, a six-sigma company so they’re still doing all their evaluation work.
The output of that has been quite significant, there’s been an awful lot of spin-off in other areas, it helped us put the graphene into the flow-type pipes, water pipes, which we announced a while back and those tests are ongoing which is good.
Also, Haydale announced in March that we’d successfully put graphene and other materials into an Airbus aileron to make it electrically conductive and defeat lightning strike which is really a massive breakthrough, that’s in conjunction with Airbus, Cobham plc (LON:COB) and GKN plc (LON:GKN). We would not have been able to do that without the knowledge that we’ve been building up through up the work we’ve been doing on the dispersions enhancement.