TIDMIKA
RNS Number : 6534A
Ilika plc
23 January 2020
Ilika plc
('Ilika,' the 'Company,' or the 'Group')
Half-year Report
Ilika (AIM: IKA), a pioneer in solid-state battery technology,
announces its unaudited half yearly report for the six months ended
31 October 2019.
Operating Highlights:
Ilika has continued to develop and commercialise its thin-film
miniature solid-state batteries for powering wireless sensors, as
well as progressing its development of large format Goliath cells
for electric vehicles (EV).
-- Launched the latest of the Company's miniature batteries, the
Stereax(R) M50 in April 2019, designed for medical implants
-- Continued the commercialisation of its Stereax(R) batteries
for industrial wireless sensors, which is the Company's second
significant addressable market opportunity and part of the
industrial Internet of Things ecosystem
-- Executed other demonstration deployments including wind
turbines, rail networks and environmental pollution monitors and
process control
-- Third Goliath alliance, project "Granite", launched in
September 2019 and led by Jaguar Land Rover. This project is
supported by grant funding from the UK Government's Faraday Battery
Challenge.
-- Total grant support offered to Ilika for its Goliath programme to date is GBP5m
-- In September 2019 the Company opened its new large format
battery facility, the Goliath pilot line, to support its portfolio
of industrial collaborations.
Financial Summary:
-- Total revenue for the period GBP1.5m (H1 2018: GBP1.0m)
-- Loss per share 1p (H1 2018: 1p per share)
-- EBITDA loss GBP1.0m (H1 2018: GBP1.3m)
-- Cash balance at period end GBP1.9m (H1 2018: GBP5.8m) with GBP0.7m banked post period end
Post period end:
-- Awarded the Green Economy Classification by the London Stock
Exchange, recognising its contribution to a more sustainable
economy.
Commenting on the results Graeme Purdy, CEO of Ilika, said: "The
first half of this financial year has seen us increase the
utilisation of the production capacity of our Stereax(R) pilot line
in response to commercial demand, positioning us for the scale-up
of miniature battery production. In parallel, we have demonstrated
our ability to act in an agile manner by rapidly completing our new
pilot line for Goliath cells. We look forward to sustained momentum
through the rest of this year and beyond."
Ilika plc
Graeme Purdy, Chief Executive
Steve Boydell, Finance Director +44 (0)23 8011 1400
Liberum Capital Limited (Nomad
and Broker)
Andrew Godber, Cameron Duncan,
William Hall +44 (0) 20 3100 2000
Walbrook PR Ltd +44 (0)20 7933 8780 or ilika@walbrookpr.com
Lianne Cawthorne Mob: +44 (0)7584 391 303
Nick Rome Mob: +44 (0)7748 325 236
Joint Chairman's and CEO's Statement
Review of Period
Principal Activities
Ilika has continued to pursue its strategy of developing and
commercialising its cutting-edge solid-state batteries for a wide
range of applications. Our mission is to own the critical design
and manufacturing intellectual property (IP), manufacture and sell
solid-state batteries in low to medium volumes and license our IP
for high volume manufacture. Our batteries use ceramic-based
lithium-ion technology that is inherently safe and stable in
manufacture and usage and offers high performance which
differentiates our products from existing batteries.
Introduction to Stereax(R) solid-state battery technology
Ilika has been working with solid-state battery technology since
2008 and has developed a type of lithium-ion battery, which,
instead of using liquid or polymer electrolyte, uses a ceramic ion
conductor. Ilika's solid-state batteries have a number of benefits
over traditional lithium-ion batteries, including the
following:
-- Non-flammable, which eliminates the need for containment packaging
-- 6x faster charging
-- 2x increased energy density, making them half the volume and
weight for a given electrical charge
-- 10x longer storage without loss of charge.
Ilika has developed a roadmap and family of battery products,
ranging from miniature solid-state devices designed for powering
wireless sensor applications to large format cells for automotive
power.
Miniature Stereax(R) batteries
Ilika's miniature Stereax(R) cells are differentiated from other
solid-state technology through its choice of materials and its use
of an efficient, low temperature evaporation process that is
capable of higher manufacturing rates than other solid-state
routes. This results in the following benefits relative to previous
solid-state battery designs:
-- Lower cost of manufacture through avoiding use of expensive sputtering targets
-- Long cycle life through use of a silicon anode
-- Less encapsulation required
-- High temperature resilience
The unique benefits of Stereax(R) batteries make them
particularly useful for medical implants and industrial
applications. Miniature Stereax(R) batteries can enable medical
devices in a way that is currently not possible with conventional
lithium-ion batteries. Their compact, biocompatibility, high energy
density, high power characteristics make them useful for a range of
medical implant applications covering blood pressure monitoring to
neuro-stimulation. Industrial automation, or Industry 4.0 as it is
sometimes referred to, requires low maintenance batteries with a
long lifetime, sometimes in situations that require them to operate
at elevated temperatures above those for which standard lithium-ion
batteries are rated (typically 60 degC).
Ilika has continued to work on a portfolio of five collaborative
deployment projects during the period:
1. Integrated energy harvester and battery for asset tagging
This is a collaborative project with Lightricity (formerly part
of Sharp Laboratories Europe) to create an autonomous energy
harvesting power source which involves combining Ilika's battery
with Lightricity's photovoltaic (PV) technology to create a
compact, self-recharging power pack. Beta prototype samples have
been shared with commercialisation partners for evaluation.
2. Miniature medical implant
This project involved the development of a battery for miniature
medical implants to provide treatments for serious health
conditions, through the body's own nervous system. The programme
has been completed and is now awaiting further progress with the
other non-battery related technology.
3. Wind turbine condition monitoring
Ilika has been working in a partnership to deploy Stereax(R)
powered devices for the condition monitoring of wind turbines with
Titan Wind Energy, the largest manufacturer of wind turbines in
China and the 4th largest globally. Beta prototype devices are
currently undergoing evaluation in a trial deployment.
4. Environmental sensing
This is a demonstration project to deploy Stereax(R) batteries
to power an autonomous wireless sensor for environmental sensing
and asset tracking.
5. Rail track condition monitoring
In Q1 2019, Ilika commenced a trial deployment of wireless
sensors for monitoring rail infrastructure with Network Rail. In
the initial deployment, sensors will measure track strain due to
high temperatures. The ability of Ilika's batteries to withstand
temperatures of up to 150 degC and "fit and forget" life makes them
particularly suitable for deployment in the hostile trackside
environment.
Stereax(R) Manufacturing Scale-up
Ilika is currently manufacturing Stereax(R) batteries on a pilot
line. These batteries are being deployed in the five collaborative
programmes described above and are also being sold for customer
evaluation. The capacity of the pilot line will be fully allocated
to product sales this year and the transfer of larger scale
production to a 3(rd) party facility is planned. Once the transfer
has been achieved, Ilika's business model will continue to be to
sell batteries on an outsourced basis. Ilika will control the
supply chain, covering wafer production, thinning, dicing,
encapsulation and testing. A further step-up in production capacity
with a larger manufacturing partner is expected to be required
further into the future, when a licensing model may be more
appropriate.
Large Format Goliath batteries
Having been approached by a number of significant commercial
partners interested in collaborating with Ilika to develop larger
capacity batteries suitable for use in electric powered vehicles,
Ilika expanded its product development roadmap in 2018.
In September 2019, Ilika announced the opening of its new large
format battery facility, the Goliath pilot line, to support its
portfolio of industrial collaborations. On this pilot line, Ilika
is developing low cost printing processes suitable for forming
batteries several orders of magnitude larger than the miniature
Stereax(R) batteries. Also, in September 2019, Ilika announced its
third Goliath alliance, project "Granite", which is being led by
Jaguar Land Rover. This project is supported by grant funding from
the UK Government's Faraday Battery Challenge, bringing the total
grant support offered to Ilika for its Goliath programme to GBP5m.
The objective of Granite is to develop cost-effective routes for
the mass production of Goliath cells. Previously secured grant
funding for the two other Goliath projects is supporting work on
rapid charging with Honda and Ricardo, as well as battery packs for
high performance vehicles with McLaren.
In addition to the programs supported by grant funding, Ilika is
also able to carry out commercially funded programs for
applications in both the automotive sector and others including
aerospace and consumer electronics.
Goliath Manufacturing Scale-up
Using a similar model to the scale-up of Stereax(R), Ilika
expects to maximize the production of Goliath batteries on its
pilot line. The capacity of the Goliath pilot line has been
designed for the demands of Ilika's three collaboration programmes
until 2021. The next stage of scale-up will require collaboration
with a 3(rd) party facility, such as the open-access Battery
Industrialisation Centre currently being built in Coventry.
Cash position
The cash balance at period end was GBP1.9m (H1 2018: GBP5.8m)
with GBP0.7m banked post period end. In the second half of the year
Ilika expects a materially lower cash outflow. Capex will be lower;
a tax credit has been received and working capital should improve.
Grants of GBP1.1m are due in the period and revenue from Stereax
product sales will continue to grow. Thereafter the continued
expansion of Ilika will require additional financing which the
directors anticipate may be a combination of grants, product sales,
licences and external capital.
Green Economy Classification & Mark
Post period end, in October 2019 the Company was awarded the
Green Economy Classification and Mark. This is a new initiative
launched by the London Stock Exchange Group (LSEG) identifying
London-listed companies and funds that generate over 50% of total
annual revenues that contribute to the global green economy.
The creation of this Green Economy Mark allows greater
visibility for investors that are interested in Green Economy
activities and recognises those companies that are contributing to
a greener more sustainable economy.
Outlook
Ilika intends to intensify the commercial scale up of its
miniature Stereax(R) technology, through investments with a 3(rd)
party manufacturing facility. Further technical progress is also
expected with Goliath, including the evaluation of cell data by
Ilika's collaboration partners. In the second half of the current
financial year, Ilika expects to continue to deliver revenue growth
relative to the previous year as its funded Goliath development
programmes proceed and commercial revenues from Stereax(R) sales
have a positive impact.
Graeme Purdy, CEO
Keith Jackson, Chairman
Ilika plc
Consolidated statement of comprehensive income for the six
months ended 31 October 2019
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Oct 2019 31 Oct 2018 30 Apr 2019
Notes GBP GBP GBP
------------------------------------- ------ -------------- -------------- --------------
Turnover 1,460,639 1,010,896 2,589,736
------------------------------------- ------ -------------- -------------- --------------
Revenue 212,823 283,382 345,307
UK grants 1,247,816 727,514 2,244,429
------------------------------------- ------ -------------- -------------- --------------
Cost of sales (782,115) (559,554) (1,388,598)
Gross profit 678,524 451,342 1,201,138
Administrative expenses
------------------------------------- ------ -------------- -------------- --------------
Administrative expenses (2,132,354) (1,800,128) (3,630,369)
Share-based payment charge (119,348) (180,164) (264,250)
------------------------------------- ------ -------------- -------------- --------------
2,251,702 1,980,292 3,894,619
--------------
Operating loss (1,573,178) (1,528,950) (2,693,481)
Financial income 8,386 8,880 25,800
Financial expense (6,432) - -
-------------- -------------- --------------
Loss before tax (1,571,224) (1,520,070) (2,667,681)
Taxation 139,734 171,922 346,922
Loss for period/total comprehensive
income attributable to owners
of parent (1,431,490) (1,348,148) (2,320,759)
Loss per share
Basic and diluted 2 (0.01) (0.01) (0.02)
-------------- -------------- --------------
The results from the periods shown above are derived entirely
from continuing operations.
Consolidated balance sheet as at 31 October 2019
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Oct 2019 31 Oct 2018 30 Apr
2019
Notes GBP GBP GBP
------------------------------------ ------- ------------- ------------- -------------
ASSETS
Non-current assets
Intangible assets 21,466 2,453 23,815
Property, plant and equipment 2,186,502 509,390 1,728,122
------------- ------------- -------------
Total non-current assets 2,207,968 511,843 1,751,937
------------- ------------- -------------
Current assets
Trade and other receivables 1,520,349 1,081,150 1,542,996
Current tax receivable 499,734 185,000 360,000
Other financial assets - bank
deposits 353,831 350,001 351,963
Cash and cash equivalents 1,507,631 5,440,859 3,599,216
------------- -------------
Total current assets 3,881,545 7,057,010 5,854,175
------------- ------------- -------------
Total assets 6,089,513 7,568,853 7,606,112
------------- ------------- -------------
Issued capital and reserves attributable
to owners of parent
Issued share capital 1,013,670 1,013,070 1,013,070
Share premium 27,103,356 27,103,356 27,103,356
Capital restructuring reserve 6,486,077 6,486,077 6,486,077
Retained earnings (30,043,689) (27,837,331) (28,725,856)
------------- ------------- -------------
Total equity 4,559,414 6,765,173 5,876,647
------------- ------------- -------------
LIABILITIES
Non-current liabilities 192,004 - -
------------- ------------- -------------
Current liabilities
Trade and other payables 1,048,005 653,680 1,439,465
Provisions 290,000 150,000 290,000
------------- ------------- -------------
Total current liabilities 1,338,005 803,680 1,729,465
------------- -------------
Total liabilities 1,530,099 803,680 1,729,465
------------- ------------- -------------
Total equity and liabilities 6,089,513 7,568,853 7,606,112
------------- ------------- -------------
Consolidated cash flow statement for the six months ended 31
October 2019
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Oct 2019 31 Oct 2018 30 Apr 2019
GBP GBP GBP
------------------------------------------- ------------- ------------- -------------
Cash flows from operating activities
Loss before taxation (1,571,224) (1,520,070) (2,667,681)
Adjustments for:
Amortisation 5,566 526 3,621
Depreciation 464,349 91,907 233,744
Equity settled share-based payments 119,348 180,164 264,250
Net financial income (1,954) (8,880) (25,800)
------------- ------------- -------------
Operating cash flow before changes
in working capital, interest and
taxes (983,915) (1,256,353) (2,191,866)
Decrease/(increase) in trade and
other
receivables 3,514 (56,791) (518,637)
Increase /(decrease) in trade and
other payables (458,907) (155,994) 357,472)
------------- ------------- -------------
Cash utilised by operations (1,439,308) (1,469,138) (2,353,031)
Tax received - 316,922 316,922
------------- ------------- -------------
Net cash flow from operating activities (1,439,308) (1,152,216) (2,036,109)
Cash flows from investing activities
Interest received 8,386 8,880 25,800
Purchase of intangible assets (3,217) - (24,983)
Purchase of property, plant and equipment (617,917) (23,719) (971,443)
Increase in other financial assets (1,867) (350,001) (351,963)
------------- ------------- -------------
Net cash used in investing activities (614,615) (364,840) (1,322,589)
Cash flows from financing activities
Proceeds from issuance of ordinary
share capital 600 4,463,178 4,463,178
Cost of share issue - (316,418) (316,419)
Capital element of finance leases (31,830) - -
repaid
Interest paid (6,432) - -
------------- ------------- -------------
Net cash from financing activities (37,662) 4,146,760 4,146,759
------------- ------------- -------------
Net (decrease)/ increase in cash
and cash equivalents (2,091,585) 2,629,704 788,061
Cash and cash equivalents at the
start of the period 3,599,216 2,811,155 2,811,155
Cash and cash equivalents at the
end of the period 1,507,631 5,440,859 3,599,216
============= ============= =============
Consolidated statement of changes in equity (unaudited)
Share premium Capital
Share account restructuring Retained
capital reserve earnings Total
GBP GBP GBP GBP GBP
------------------------- ---------- -------------- --------------- -------------- --------------
As at 30(th) April
2018 789,911 23,179,756 6,486,077 (26,669,347) 3,786,397
Issue of shares 223,159 4,240,019 - - 4,463,178
Expenses of share issue - (316,419) - (316,419)
Share-based payment - - - 180,164 180,164
Loss and total
comprehensive income - - - (1,348,148) (1,348,148)
As at 31 October 2018 1,013,070 27,103,356 6,486,077 (27,837,331) 6,765,173
---------- -------------- --------------- -------------- --------------
Share-based payment - - - 84,086 84,086
Loss and total
comprehensive income - - - (972,611) (972,611)
---------- -------------- --------------- -------------- --------------
As at 30(th) April
2019 1,013,070 27,103,356 6,486,077 (28,725,856) 5,876,647
---------- -------------- --------------- -------------- --------------
Adjustment in respect
of
adoption of IFRS 16 - - - (5,691) (5,691)
---------- -------------- --------------- -------------- --------------
As at 30th April 2019
(restated) 1,013,070 27,103,356 6,486,077 (28,731,547) 5,870,956
---------- -------------- --------------- -------------- --------------
Issue of shares 600 - - - 600
Share-based payment - - - 119,348 119,348
Loss and total
comprehensive income - - - (1,431,490) (1,431,490)
---------- -------------- --------------- -------------- --------------
As at 31 October 2019 1,013,670 27,103,356 6,486,077 (30,043,689) 4,559,414
---------- -------------- --------------- -------------- --------------
Share capital
The share capital represents the nominal value of the equity
shares in issue.
Share premium account
When shares are issued, any premium paid above the nominal value
is credited to the share premium reserve.
Retained earnings
The retained earnings reserve records the accumulated profits
and losses of the Group since inception of the business.
Capital restructuring reserve
The capital restructuring reserve arises on the accounting for
the share for share exchange. It represents the difference between
the value of the issued equity instruments of Ilika Technologies
Limited immediately before the share for share exchange and the
equity instruments of Ilika plc along with the shares issued to
effect the share for share exchange.
Notes to the consolidated financial statements
1. Accounting policies
Basis of preparation
The interim financial statements, which are unaudited, have been
prepared on the basis of accounting policies consistent with
International Financial Reporting Standards ("IFRSs") adopted by
the European Union. The accounting policies are the same as applied
in the Group's latest financial statements.
The interim financial statements do not include all of the
information required for full annual financial statements and do
not comply with all the disclosures in IAS 34 'Interim Financial
Reporting'. Accordingly, whilst the interim financial statements
have been prepared in accordance with IFRS they cannot be construed
as being in full compliance with IFRS.
The financial information for the year ended 30 April 2019 does
not constitute the full statutory accounts for that period. The
Annual Report and Accounts for 30 April 2019 have been filed with
the Registrar of Companies. The Independent Auditors' Report on the
Annual Report and Accounts for 2019 was unqualified and did not
include references to any matters which the auditors drew attention
by way of emphasis without qualifying their report and did not
contain statements under Section 498(2) or 498(3) of the Companies
Act 2006.
Going concern
The financial statements are prepared on a going concern basis
which the directors believe continues to be appropriate. The Group
meets its day to day working capital requirements through existing
cash resources which, at 31 October 2019, amounted to GBP1.9m
supplemented by the GBP0.7m received post period end. The directors
have prepared projected cash flow information for the period ending
twelve months from the date of their approval of these financial
statements. The Board is confident that in the event that they
choose to raise further finance this would be achievable based on
the future prospects of the business and previous experience in
raising equity finance, but acknowledge that this would be
dependent on market conditions. On the basis of this cash flow
information the directors believe that the Group will be able to
continue to trade for the foreseeable future.
2. Loss per share
Loss per ordinary share have been calculated using the weighted
average number of shares in issue during the relevant financial
periods. The weighted average number of equity shares in issue and
the earnings, being loss after tax, are as follows:
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Oct 2019 31 Oct 2018 30 Apr 2019
Number Number Number
----------------------------------- ------------- ------------- -------------
Weighted average number of equity
shares 101,321,426 90,331,972 95,789,335
GBP GBP GBP
----------------------------------- ------------- ------------- -------------
Loss, being loss after tax (1,431,490) (1,348,148) (2,320,759)
The loss attributable to ordinary shareholders and weighted
average number of ordinary shares for the purpose of calculating
the diluted earnings per ordinary share are identical to those used
for basic earnings per share. This is because the exercise of share
options and warrants would have the effect of reducing the loss per
ordinary share and is therefore not dilutive under the terms of IAS
33.
- Ends -
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END
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