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Ceres Power Holdings

Q&A with William Game Equity Analyst at Zeus Capital: Ceres Power Holdings plc (LON:CWR)

Ceres Power Holdings plc (LON:CWR) is the topic of conversation when Zeus Capital’s Equity Analyst William Game caught up with DirectorsTalk for an exclusive interview

 

Q1: Ceres Power Holdings put out a rather strong half-year report today, what can you tell me about the financials?

A1: It’s certainly been a strong period of continued progress particularly at a commercial level.

The sales have grown from £1.6 million in a comparative period to £3.1 million in this interim and this comprises a doubling of revenue from customer programme from £1 million to £2.6 million and an unchanged grant income of £0.5 million.

The group delivered an operating loss of £6.2 million but this reflects an increased investment in personnel, particularly working on programmes with Ceres’ partners over the period.
At the end of the period, cash was £13.2 million and this results from a free cash outflow of £4.1 million and includes increased investment of £0.4 million in the period, particularly in manufacturing capacity to meet increased demand from partners.

 

Q2: So, what were the key developments that the company’s made during the period?

A2: It certainly communicated these well over the past 6 months, I think notably the most recent news is securing a fifth development partner, it’s an unnamed but major European OEM so that’s very important.

Elsewhere, the company completed a technology transfer with its other confidential customer to develop multi-kilowatt combined heat and power product for the homes. Also, the successful field trials in the UK which is supported by the European programme, ene.field, concluded in September, this confirmed excellent efficiency, flexibility and reliability of Ceres’ SteelCell product.

The business continues to meet milestones in the electric vehicle range extender programme which was announced in June 2016 with Nissan. They are also working closely with Cummins and the US Department of Energy developing the higher density power cells, initially at a 5-kilowatt stack but is certainly developing the 10-kilowatt stacks for data centres in the future.

 

Q3: In terms of the outlook, what can we expect for the rest of the year?

A3: I think the rest of the year, again, is going to be achieving the company’s targets and milestones with customers. There are another two further OEM’s at this stage, at the technology assessment stage, and the management team is confident in signing additional partners in FY18.

There are expected to be further field trials for Ceres’ technology over the next 6 months which will be seen as an important milestone towards commerciality.

The company has also highlighted in this statement that it is seeking additional capital, either through strategic or financial investment, at this point and the statement points to a number of discussions happening now.

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Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.