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Ceres Power expects full-year revenues to grow by around a third

At the end of 2019, Ceres had a strong order book of £22mln and a pipeline of £50mln comprising a combination of staged licensing payments and engineering services.

Ceres Power Holdings PLC -

Ceres Power Holdings PLC (LON:CWR) expects full-year revenue growth to roughly match the 33% year-on-year increase achieved in the first half of its financial year.

The fuel cell and electrochemical technology company that has the backing of Bosch, the German engineering and technology giant, saw total revenue and other operating income rise to £11.04mln in the six months to the end of December 2019 from £8.27mln in the same period of 2018.

A higher proportion of engineering services than in 2018 meant the gross margin eased to 67% in the period from 82% in the corresponding period of 2018 but this was comfortably ahead of the company’s target of maintaining margins above 50%.

“We continue to anticipate that the mix between licence fees and engineering services will vary going forwards, based on deal flow,” the company said.

At the end of 2019, Ceres had a strong order book of £22mln and a pipeline of £50mln comprising a combination of staged licensing payments and engineering services.

The adjusted underlying loss (LBITDA) narrowed to £1.41mln from £2.01mln the previous year. The reported loss before tax was £2.79mln, compared to a loss the year before of £2.81mln.

The value of net cash and short-term investments at the end of 2019 stood at £64.61mln, down from £71.27mln at the end of June 2019.

No company update these days seems complete without a reference to the effects of the coronavirus and the statement from Ceres was no exception with the company saying it could see some short-term impact on the timing of its partner programmes and manufacturing output in the UK; nevertheless, its current guidance for the full year performance remains aligned with market expectations.

"Ceres has a technology that the world urgently needs to tackle climate change. As a management team, we are focused on maintaining our industry-leading position in fuel cells, while also maximising the future value for Ceres presented by the broader addressable market for clean energy technology,” said Phil Caldwell, the chief executive officer of Ceres Power.

“I believe that the quality and success of the partnerships we have built with Bosch, Weichai, Doosan, Miura and others is a huge endorsement of our technology, our team and our approach. We are now in a privileged position, with investor support, committed partners and balance sheet strength, to capitalise on the substantial opportunities that exist to deliver long-term profit and to do so with purpose," he added.

Quick facts: Ceres Power Holdings PLC

Price: 342.5 GBX

LSE:CWR
Market: LSE
Market Cap: £572.3 m
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