TIDMEQT
RNS Number : 1380N
EQTEC PLC
28 September 2021
28 September 2021
EQTEC plc
("EQTEC", the "Company" or the "Group")
Interim results for the six months ended 30 June 2021
EQTEC plc (AIM: EQT), a world-leading gasification solutions
company building the future of a cleaner waste-to-energy industry,
is pleased to announce its unaudited interim results for the six
months ended 30 June 2021.
Highlights
-- Growing conversion of pipeline opportunities into active development projects
-- Financial Close of first Market Development Centre, with others following
-- Investment in growth platform through Joint Ventures and expert teams
-- Oversubscribed placing for GBP16 million in new development capital
-- Ramp-up in engagement with policy makers, influencers and ESG interest groups
-- On track to achieve seven times revenue growth over previous year
David Palumbo, CEO of EQTEC, commented:
"As we approach the United Nations Climate Change Conference
(COP26) UK 2021 in November, we are pleased to share our Interim
Results for 2021 and outlook for the second half of the year, along
with a broader update about how we are strengthening our efforts to
transform waste into clean energy and biofuels. Our hope for COP26
is that the EU, UK and USA in particular embrace more ambitious and
stringent targets aimed at ultimate outcomes for the environment,
such as increased carbon efficiency and reduced total emissions,
especially of the most hazardous pollutants.
The Company has been increasingly active in 2021 with policy
influencers and policymakers. Early in the year, we joined and
worked closely with a number of industry associations in the EU and
UK. We contributed directly to and co-authored the European Biogas
Association's upcoming whitepaper, Gasification: a sustainable
technology for circular economies - scaling up to reach Net Zero by
2050 , and we made written submissions to consultations opened by
UK Environment Agency and UK Department for Business, Energy and
Industrial Strategy (BEIS).
Policymakers need to know that EQTEC's Advanced Gasification is
not a concept technology for the future - it is a 'now' solution
for 'now' challenges of waste management and clean energy. Through
the projects we are developing right now, EQTEC's innovations are
being aimed at:
-- Preventing forest fires in California;
-- Clearing farming waste and delivering clean energy in Greece, Italy and Croatia;
-- Handling municipal solid waste and delivering clean energy at scale in the UK;
-- Innovating synthetic natural gas ("SNG") solutions in Ireland; and
-- Converting legacy facilities in France to handle industrial and contaminated waste.
Our solutions deliver both a low emissions profile from waste
treatment along with highly efficient production of energy or
biofuel. So, even as we push harder to raise awareness of the
immediate contribution we will make to the goals of COP26, we are
hard at work identifying, qualifying and pursuing new projects in
our target markets, for those who already know.
Throughout the first half of 2021, we focused our efforts on
building out our platform for growth and scale. We converted more
opportunities into active projects, formalised local, joint venture
("JV") partnerships, kicked off acquisition and development of
Market Development Centres ("MDCs") and grew our team of
experienced, project development experts to pursue more
opportunities with quality and pace. As awareness and interest
grows in gasification, we will be prepared to respond.
The Group is growing, making Advanced Gasification Technology
more available to more places for more applications, but we want to
move faster. To accelerate, we need stronger support from public
policy, local authorities and the clean energy sector. EQTEC's
Advanced Gasification Technology was proven long ago, but we need
to increase awareness further with EU, UK, US and others, of the
superior efficiency, emissions profile and sustainability of our
solutions versus legacy alternatives. The ESG strategy and
marketing strategy we are currently developing for 2022 onwards
will contribute to giving gasification a greater profile, and
position EQTEC as the leader of the sector.
We look forward to closer engagement and collaboration with
influencers and policymakers to position EQTEC as a leader in
waste-to-energy for the present and the future. We believe the
greatest proof of our capabilities is in implementing them more
often, in more plants; but we also believe that an increasingly
supportive policy environment, with incentives for superior
cleantech solutions, would accelerate our progress and the benefits
we deliver toward sustainable ecosystems."
OPERATIONAL, COMMERCIAL AND CORPORATE HIGHLIGHTS
Plant construction:
-- In the first half of the year, the Company progressed with
installation of the gasification reactor and associated equipment
inside the primary steel structures at its 2MWe facility at North
Fork, in California, USA. The site was attended for three weeks in
May by CTO Yoel Alemán and another EQTEC expert engineer, following
relaxation of Covid-19 travel restrictions.
-- Additionally, the Company and its partners ewerGy GmbH
("ewerGy") and local partner ECO Hellas ("ECO Hellas") progressed
construction work on the 0.5 MWe Agrigas 1 biomass-to-energy plant
in Larissa, Greece.
Financial close:
-- On 17 May, the Company announced it had formed a consortium
to acquire and recommission a plant in Italy with EQTEC's
gasification technology at its centre. On 21 June, the Company
announced Financial Close of the 1MWe, EQTEC Italia MDC
biomass-to-energy project in Tuscany, Italy, the first of EQTEC's
Market Development Centres ("MDCs"). Once operational, it is
expected that EQTEC will become the O&M contractor for the
plant.
Project development:
-- On 8 January, the Company signed a Memorandum of
Understanding ("MoU") with Nobilis Pro Energy S.A. ("Nobilis"). The
agreement includes the collaborative development of Nobilis's
existing pipeline of opportunities in Thessalia and Central Greece
and for the proposed delivery of these and further projects,
including construction in Nobilis, Almyros, with grid connection
and the land agreement in place.
-- On 27 January, EQTEC received notification of planning
approval from Stockton-on-Tees Borough Council for an improved
waste-to-energy scheme for the Company's RDF-to-energy project at
Billingham, Teesside, which will be the UK's first EQTEC Advanced
Gasification plant ("Billingham"). On 26 February, the Company
announced that the Billingham project Special Purpose Vehicle
("SPV"), Haverton WTV Limited, had signed a conditional Land
Purchase Agreement ("LPA") for the land on which the proposed plant
will be constructed and commissioned. In June, the Company
announced completion of concept design work for the core
gasification process and progress with design on the full
plant.
-- On 9 February, the Company signed a Collaboration Framework
Agreement with Logik Developments Limited ("Logik"), including the
participation by both Parties to develop an RDF-to-energy project
at Deeside, Flintshire, UK, through the Deeside WTV Limited SPV
("Deeside"). On 11 March, the Company announced it had signed a
Collaboration Framework Agreement with Toyota Motor Manufacturing
UK ("Toyota"), effective for three years. Through the Deeside
RDF-to-energy project, the Company and Toyota agreed to collaborate
to explore an innovative, circular and sustainable waste-to-energy
solution for Toyota's engine manufacturing plant in Deeside. This
could include establishing a supply of power and gas to the Toyota
engine manufacturing site and the potential supply of bio-methane
gas and green electricity and conversion of manufacturing waste
through the sharing of cost data, energy usage and other
information. In June, the Company submitted a planning application
for a Phase 2 gasification facility deploying EQTEC technology at
the Deeside site where Phase 1 recycling and anaerobic digestion
facilities are already approved for development. As most planning
conditions have been satisfied for Phase 1, the project is on track
for Financial Close.
Other business development:
-- On 22 March, the Company announced it had entered into a
Framework Partnership Agreement ("FPA") with MetalNRG plc
("MetalNRG"), to develop shovel-ready, biomass-to-energy,
RDF-to-energy and sustainable, clean energy projects in the UK and
Europe through MetalNRG's SPV, MetalNRG Eco Limited. The Company
acquired GBP500,000 in MetalNRG shares through the exchange of the
same value of EQTEC shares with MetalNRG as at 7 May 2021. MetalNRG
has since participated in one EQTEC project, currently under
construction, as a consortium investor, in the recommissioning and
repowering of the Italia MDC project.
Broker appointment:
-- On 29 March, the Company appointed Canaccord Genuity Limited as Joint Broker.
FINANCIAL HIGHLIGHTS
-- Revenue: For the six-month period through to 30 June 2020,
the Company recorded revenue of EUR0.5 million, predominantly from
technology sales.
-- Profit/(loss): For the same period, the Company recorded an
adjusted net loss of EUR2.6 million, impacted by increased,
growth-orientated operational expenditure and before a EUR1.4
million loss arising from a non-cash item relating to share-based
payments.
-- Assets: As at 30 June 2021, the net assets of the Group stood
at EUR42.8 million, which included new capital raised from the
Placing in May 2021.
-- Cash: The cash balances of the Group as at 30 June 2021 were EUR15.3 million.
-- Debt: In January 2021, the Company agreed a new loan facility
of EUR1.25 million with EQTEC shareholder Altair Group Investment
Limited ("Altair"), with a maturity date of 31 December 2021. The
loan, fully drawn down to repay an outstanding debt with another
lender, had a lower interest rate than the previously held debt
facility but was then itself repaid in full to Altair, in June
2021, six months ahead of schedule.
-- Placing: On 28 May 2021, the Company successfully completed a
Placing that raised GBP16 million (EUR19 million), before expenses,
in new investment capital aimed at accelerating the Company's
growth. The capital raised through the Placing has been and will
continue to be deployed to three key areas: (1) project development
of MDCs; (2) project development of larger, RDF-to-energy deals in
the UK; and (3) growth in the Company's capability and capacity.
The Placing generated new interest in the Company and was
oversubscribed.
-- Long-term Incentive Plan ("LTIP"): In February, the Company
announced its LTIP for all directors and employees to link pay with
Company and individual performance and to invest in talent to grow
the business. It also announced the granting of share options for
2021, which would vest over three years starting the following
year, subject to conditions. The Company confirmed that the LTIP is
the Company's sole, long-term incentive programme and that it
therefore has no plans to issue further warrants as remuneration,
as normal business practice. As at 30 June 2021, the Company had a
total of 658,210,979 employee-related warrants and options
outstanding, all of which were issued prior to the introduction of
the LTIP.
POST PERIOD HIGHLIGHTS
July 2021
-- On 12 July, the Company announced it had made a non-binding
proposal to provide requisite funding, as a convertible loan
facility, to take to completion the North Fork, California, USA
project. The proposed facility, if accepted, fully drawn down and
converted, would result in the Company's increasing its current
minority stake to take a controlling interest in the project
project SPV, North Fork Community Power (NFCP). The Company expects
legal execution to be concluded shortly.
-- On 19 July, the Company confirmed that the first shipment of
technology components was received on site at the Agrigas 1 project
in Larissa, Greece.
-- On 19 July, the Company announced that designs for the
Billingham RDF-to-energy project had been reviewed with potential
partners, including French waste-to-energy owner-operator, Groupe
Idex ("Idex"). It also confirmed that the project team had launched
engagement with prospective delivery partners including Tier 1 EPC
companies.
-- On 19 July, Nauman Babar was appointed to the board of directors as Finance Director.
August 2021
-- On 11 August, the Company announced the acquisition, through
Synergy Projects d.o.o. ("Synergy Croatia"), a joint venture
between the Company and its Croatian project development partner
Sense ESCO d.o.o. ("Sense ESCO"), of a 1.2 MWe biomass-to-energy
gasification plant in Belišće, Croatia. The contract value of
EQTEC's technology sales for the plant is expected to be EUR1.7
million in technology and engineering upgrades. Once operational it
will become the second EQTEC Market Development Centre.
Additionally, it is expected that the Company will become the
plant's O&M contractor.
September 2021
-- On 14 September, the Company announced the acquisition,
through Synergy Croatia , of a 1.2 MWe biomass-to-energy
gasification plant in Karlovac, Croatia. The plant, expected to be
updated, recommissioned and repowered for operations towards the
end of 2022, is expected to produce approximately 1.2 MW of
electricity as well as high-quality biochar. The contract value of
EQTEC's technology sales for the plant is expected to be c. EUR4.5
million in technology and engineering. Additionally, is expected
that the Company will become the plant's O&M contractor.
-- On 15 September, the Company confirmed that most technology
components, including the Siemens Jenbacher engine, had arrived on
site at Agrigas 1. The Company can now confirm that the final
shipment of equipment, to include heat exchangers, gasifier,
cyclone, filters and refractory, is expected to be shipped by the
end of September and delivered on site in October.
-- On 16 September, the Company announced it had signed a Heads
of Terms with Kibo Energy plc ("Kibo"), with Kibo expected to
acquire, after finalising a Share Purchase and Shareholders
Agreement and securing of the requisite funding, a 54.54% equity
stake in the Billingham, Teesside, UK project SPV, for a
contribution of GBP3 million.
-- On 24 September, the Company announced the formation of a JV,
EQTEC Synergy Projects Limited ("Synergy Aegean") between EQTEC and
its Greek strategic partners, German EPC ewerGy GmbH ("ewerGy")
operating in Greece via its local partner, ECO Hellas M IKE ("ECO
Hellas") . It was also confirmed that Synergy Aegean had signed an
agreement for the proposed acquisition of a 1MWe biomass-to-energy
gasification project in Livadia, Greece and exclusivity for a
second 1MWe project nearby.
-- On 27 September, the Company announced that its wholly owned
subsidiary, Southport WTV Limited, project SPV for the Southport,
Merseyside, UK RDF-to-energy project, had signed a Share Purchase
Agreement with Rotunda Group Limited ("Rotunda") and its subsidiary
Shankley Biogas Limited, to acquire full ownership of the Southport
Hybrid Energy Park project from Rotunda through the acquisition of
Shankley Biogas Limited.
Outlook
-- The Company remains on track to achieve its previously stated
2021 revenue forecast of approximately EUR15 million, assuming
timely closure of EQTEC projects as planned. This would represent a
700% increase in revenue over the EUR2.2 million in revenue
delivered in 2020.
-- The Company expects to deliver modest EBITDA for the year,
following investments made to accelerate growth. This supports its
aspiration for 2021 to be its first year with positive EBITDA
whilst investing in commercial sustainablility and scale.
Investments include expert support for project development and new
talent to build the growth platform and R&D initiatives to keep
EQTEC technology at the leading edge.
-- The Company expects to continue increasing the number of
pipeline opportunities it converts to projects under active
development. In support of this growth, it expects to invest in
increased engineering capability and capacity, especially in
mechanical, electrical and civil engineering, and grow its
engineering and project management capabilities to undertake more
projects in parallel, in more places, at the same time.
-- Inspired by a highly active and accelerating interest in
cleantech from the French national, regional and local governments
and from potential lenders and development partners, the Company
has identified and is pursuing a number of opportunities in France.
These include potential projects for biomass-to-energy and for
gasification of industrial and contaminated waste, including
retro-fitting of legacy, fossil fuel facilities for reuse as
cleantech businesses.
-- The Company and its Ireland-based partner Carbon Sole Group
Limited ("Carbon Sole") continue to pursue development of two or
more projects in Ireland for biomass-to-bioenergy plants and in
particular sustainable forestry waste for production of synthetic
natural gas ("SNG"). To further support these efforts, EQTEC is
discussing technology collaboration with potential partners for
methanation and other technologies that help convert syngas into
various forms of bioenergy.
-- The Company continues to actively pursue its innovation,
research and development ("R&D") programme, especially through
its partnership with the Université de Lorraine ("UoL") in France.
At least three R&D trials are planned at the end of 2021 with
UoL and other partners, toward testing of RDF, plastic residues and
waste wood biomass feedstocks. New projects and a new R&D
agenda for 2022 will be defined by year end with UoL and other
technology partners.
-- Aligned with its mission, the Company is committed to
demonstrating the importance of leading delivery of environmental,
social and governance ("ESG") initiatives. Working with a leading
third-party consultancy, the Company is developing an ESG statement
of intent and incorporation of specific, ESG objectives and
activities into its strategy and business plans. The Company looks
forward to providing an update on its ESG intentions at the end of
the year.
The unaudited interim results for the six months ended 30 June
2021, which are contained below and form part of this announcement,
include further important information and disclosures. The
announcement should be read in its entirety.
The Company will update shareholders in its next planned
quarterly update in early 2022.
This announcement contains inside information as defined in
Article 7 of the EU Market Abuse Regulation No 596/2014 and has
been announced in accordance with the Company's obligations under
Article 17 of that Regulation.
CEO REPORT
The first half of 2021 was formative for EQTEC, and it is my
shared expectation with the Board of Directors that the Group will
see the fruit of these efforts in our 2021 annual results.
We converted more pipeline opportunities into projects focused
on and ready for development, building a platform for growth and
scale from which to launch them and increasing the number of future
projects to Financial Close and beyond. The Group is growing: in
terms of opportunities, projects, relationships, partnerships and
formal channels for establishing our Advanced Gasification
Technology as the core of more business models that address today's
problems of how to reduce waste and generate more energy, more
cleanly, in more markets.
The Board of Directors remains steadfast in our focus on
achieving our revenue target this year. Delivery of c.EUR15 million
in revenue would represent a seven-fold increase over 2020 and
truly indicate the pace of growth we are experiencing. As indicated
in our Q2 Trading Update, the Company entered 2021 with full
knowledge that the second half of the year would see the financial
results of strong efforts in the first half.
With that in mind, the first half of 2021 was focused on:
1. Market growth . It was only one year ago, in our 2020 Interim
Results, that we announced pipeline growth from 15 to 41
opportunities. In our March 2021 Trading Update, we announced
pipeline growth from 41 to 75 opportunities and since then, the
number of opportunities continues to grow. Perhaps more
significantly, and following the closure of two deals in 2020, we
announced in March that 10, specific projects were under
construction or under development, demonstrating our ability to
successfully convert that pipeline into revenue generating
projects. By the end of June, that number was 13, as outlined in
our Q2 Trading Update. As of this report, we have 17 projects under
construction or development, indicating steady growth based on the
strength of our project development teams and our local
partnerships in target markets.
In March, we announced the evolution of some go-to-market
partner relationships into formal, joint ventures. We announced the
first, in Croatia, with formation of Synergy Projects d.o.o.
("Synergy Croatia"). The second, formalised this month, is for
Greece, with the formation of EQTEC Synergy Projects Limited. Both
are led by the Group and link us with local markets through well
established partners, who will lead local development activities,
nurture relationships with local communities and decision-makers
and provide a range of other services from funding management to
commercial negotiation, and from plant engineering and procurement
to construction and commissioning management. We look forward to
announcing JVs in other target markets.
In May, we announced the acquisition of our first MDC in Italy,
later in the year announcing a second in Croatia. We also indicated
our intentions to invest in MDCs in other markets. The MDCs will
showcase EQTEC technology in live, commercial environments and
drive greater awareness and understanding of our contribution to
cleaner, more efficient energy and biofuel production.
2. Platform for sustainable growth . To support the growth in
pipeline and our ability to convert more opportunities into
projects in more markets, without sacrificing the quality or pace
of development, we invested in capabilities and capacity to support
the quality and pace we require as we further grow the business
into the future.
Toward driving high-quality project development at pace, we
invested in onboarding a cadre of veteran project developers and
waste-to-energy commercial experts to work with us on our most
complex projects. We established a framework for EQTEC project
development across commercial, funding, engineering and delivery
readiness activities and we appointed 'integration leads' to drive
project development to a single plan for high-quality, on-time
outcomes. Combined with the experience and expertise of our
strategic partners in target markets, we will combine the 'best of
the best' into standards, methods and tools for consistent use.
We appointed a new Finance Director, who reviewed current
financial management and statutory compliance arrangements and
outlined near-term and longer-term priorities for further building
out financial controls, compliance and reportin g, project finance
standards and financial modelling capabilities. We refined our
financial modelling tools and ran multiple scenarios in various
projects to maximise IRRs and risk mitigation. We continued
identifying and negotiating with prospective offtake customers,
feedstock providers and project investors.
Critically, we built a plan to rapidly scale our engineering
capability alongside our established engineering partners and look
forward to making future announcements about our progress.
3. Market awareness. We improved our engagement with news media
and key stakeholders including policy influencers and
policy-makers.
We joined the Association for Renewable Energy and Clean
Technology (REA) in the UK and Bioenergy Europe and the European
Biogas Association (EBA) in the EU. We joined advanced thermal
conversion technology (ATCT) working groups and we contributed
evidence to the Environment Agency and the UK Department for
Business, Energy and Industrial Strategy (BEIS) Biomass Strategy
call for evidence in The Role of Biomass in Achieving Net Zero.
We responded to Bioenergy Europe's call for case studies to
input to its Study: Bioenergy in 2050. We submitted additional
information to these organisations about the positive impacts of
gasification plants in supporting a circular economy; plants
complementary with other technologies in reducing emissions,
creating employment and stimulating local communities and
economies.
We played a key role in co-authoring the EBA's first
gasification whitepaper, Gasification: a sustainable technology for
circular economies - scaling up to reach Net Zero by 2050 , to be
published in October aimed at growing awareness from EU
policymakers, media and other stakeholders as to the full potential
of gasification as a circular economic model and enabler for
realising Net Zero targets.
To fund the build-out and application of our platform for growth
and scale, we announced in May a successful, over-subscribed
Placing, which raised more than GBP16 million in investment
capital. We have been quick and efficient at deployment of much of
this capital as intended.
The Company feels very different at Interim Results 2021 than it
did at Interim Results 2020, and the Board of Directors shares my
view that it will feel very different again at Interim Results
2022. The growing stability of our platform allows us now to look
for growth as a Group business in multiple markets and
increasingly, with multiple use cases and business models based on
EQTEC technology.
The versatility of EQTEC technology accommodates a wide range of
feedstock and a wide range of applications as well. We are
currently pursuing predominantly power and heat applications from a
range of feedstocks. But we are running trials and tests with our
R&D partners for both feedstock and applications, and we are
growing our relationships with technology partners to work with us
on a more diverse range of applications such as SNG, biofuels and
hydrogen.
I note that hydrogen has been much in the news over recent
weeks. As one of the three major components of the syngas produced
through EQTEC Advanced Gasification Technology, we have long
anticipated the rise of hydrogen as a commercially viable
proposition. A clear hydrogen economy has yet to emerge, due both
to the prohibitive cost of electrolysers and a lack of
quantifiable, commercial demand.
However, because we see resolution of these challenges on the
horizon, EQTEC will be ready. Our technology is exceptionally
well-positioned by the ultra-pure, intermediate fuel it produces
for a range of applications, including hydrogen via water-gas shift
("WGS") reaction. We are actively exploring certification with TÜV
for hydrogen-linked technologies. In parallel, we are actively
developing agreements with leading technology partners for joint,
go-to-market solution development based on hydrogen and other
applications. For at least one project under development where
there is qualified commercial demand for hydrogen, we are
considering proposal of syngas-based alternatives to the proposed
electroloysis solution. We expect to make announcements on these
points shortly.
As the global community turns its attention towards COP 26 in
Glasgow this November, I am pleased to reaffirm that the Company is
taking a greater role in more places, with more partners and with
increasing impact to define our place in the Net Zero economy and
make a meaningful contribution to sustainable, cleantech businesses
around the world.
David Palumbo
Chief Executive Officer
UNAUDITED INTERIM FINANCIAL STATEMENTS
EQTEC plc
Unaudited condensed consolidated statement of profit or loss
for the six months ended 30 June 2021
Notes 6 months ended 6 months ended
30 June 2021 30 June 2020
EUR EUR
Revenue 6 481,720 770,308
Cost of sales (414,549) (690,166)
Gross profit 67,171 80,142
Operating income/(expenses)
Administrative expenses (2,277,559) (1,489,373)
Impairment of financial investments - (17,324)
Other income - 45,810
Other gains/(losses) 7 (1,404,755) -
Change in fair value of investments (52,846) -
Foreign currency gains/(losses) 123,044 74,470
Operating loss (3,544,945) (1,306,275)
Share of loss from equity (2,914) -
accounted investments
Finance income 21,711 -
Finance costs (512,414) (540,135)
Loss before taxation 6 (4,038,562) (1,846,410)
Income tax 8 - -
Loss for the financial period
f rom continuing operations (4,038,562) (1,846,410)
Profit for the financial period
from discontinued operations 21 - 24,827
LOSS FOR THE FINANCIAL PERIOD (4,038,562) (1,821,583)
Loss/(Profit) attributable
to:
Owners of the company (4,037,800) (1,819,363)
Non-controlling interest (762) (2,220)
(4,038,562) (1,821,583)
6 months ended 6 months ended
30 June 2021 30 June 2020
EUR per share EUR per share
Basic loss per share:
From continuing operations 9 (0.0005) (0.0005)
From continuing and discontinued
operations 9 (0.0005) (0.0005)
Diluted loss per share:
From continuing operations 9 (0.0005) (0.0005)
From continuing and discontinued
operations 9 (0.0005) (0.0005)
EQTEC plc
Unaudited condensed consolidated statement of other
comprehensive income
for the six months ended 30 June 2021
6 months ended 6 months
30 June 2021 ended
30 June
2020
EUR EUR
Loss for the financial period (4,038,562) (1,821,583)
Other comprehensive income/(loss)
Items that may be reclassified
subsequently to profit or loss
Exchange differences arising on
retranslation
of foreign operations 88,473 (141,181)
88,473 (141,181)
Total comprehensive loss for the
financial period (3,950,089) (1,962,764)
Attributable to:
Owners of the company (3,843,401) (2,009,617)
Non-controlling interests (106,688) 46,853
(3,950,089) (1,962,764)
EQTEC plc
Unaudited condensed consolidated statement of financial
position
At 30 June 2021
Notes 30 June 2021 31 December
2020
ASSETS EUR EUR
Non-current assets
Property, plant and equipment 10 344,810 187,792
Goodwill 11 15,283,459 15,283,459
Other intangible assets 12 2,443,832 -
Financial assets 13,14 6,930,938 5,950,513
Total non-current assets 25,003,039 21,421,764
Current assets
Development costs 15 2,433,006 503,653
Loans receivable from project
development 15 1,809,746 482,537
Trade and other receivables 16 1,741,975 894,531
Cash and cash equivalents 15,341,569 6,394,791
Total current assets 21,326,296 8,275,512
Total assets 46,329,335 29,697,276
EQTEC plc
Unaudited condensed consolidated statement of financial
position
At 30 June 2021 - continued
Notes 30 June 2021 31 December
2020
EQUITY AND LIABILITIES EUR EUR
Equity
Share capital 17 25,805,877 24,355,545
Share premium 82,859,049 62,896,521
Other reserves 2,148,220 2,148,220
Accumulated deficit (65,718,962) (61,875,561)
Equity attributable to the owners
of the company 45,094,184 27,524,725
Non-controlling interests (2,330,674) (2,223,986)
Total equity 42,763,510 25,300,739
Non-current liabilities
Lease liabilities 19 154,799 106,465
Total non-current liabilities 154,799 106,465
Current liabilities
Trade and other payables 20 3,217,177 3,183,979
Borrowings 18 - 1,020,851
Lease liabilities 19 193,849 85,242
Total current liabilities 3,411,026 4,290,072
Total equity and liabilities 46,329,335 29,697,276
EQTEC plc
Unaudited condensed consolidated statement of changes in
equity
for the six months ended 30 June 2021 and the six months ended
30 June 2020
Equity
attributable
Share Accumulated to owners of Non-controlling
Capital Share premium Other reserves deficit the company interests Total
EUR EUR EUR EUR EUR EUR EUR
Balance at 1
January 2020 21,317,482 52,487,278 - (56,011,538) 17,793,222 (2,326,274) 15,466,948
Issue of ordinary
shares 300,400 796,144 - - 1,096,544 - 1,096,544
Reclassification
on
non-controlling
interests - - - (15,760) (15,760) 15,760 -
Share issue
costs - (3,897) - - (3,897) - (3,897)
Transactions
with owners 300,400 792,247 - (15,760) 1,076,887 15,760 1,092,647
Loss for the
financial period - - - (1,819,363) (1,819,363) (2,220) (1,821,583)
Unrealised foreign
exchange
gains/(losses) - - - (190,254) (190,254) 49,073 (141,181)
Total
comprehensive
loss for the
financial period - - - (2,009,617) (2,009,617) 46,853 (1,962,764)
Balance at 30
June 2020 21,617,882 53,279,525 - (58,036,915) 16,860,492 (2,263,661) 14,596,831
Balance at 1
January 2021 24,355,545 62,896,521 2,148,220 (61,875,561) 27,524,725 (2,223,986) 25,300,739
Issue of ordinary
shares 1,403,448 21,344,046 - - 22,747,494 - 22,747,494
Issue of share
capital on
exercise
of employee
share warrants 46,884 89,351 - - 136,235 - 136,235
Share issue
costs - (1,470,869) - - (1,470,869) - (1,470,869)
Transactions
with owners 1,450,332 19,962,528 - - 21,412,860 - 21,412,860
Loss for the
financial period - - - (4,037,800) (4,037,800) (762) (4,038,562)
Unrealised foreign
exchange losses - - - 194,399 194,399 (105,926) 88,473
Total
comprehensive
loss for the
financial period - - - (3,843,401) (3,843,401) (106,688) (3,950,089)
Balance at 30
June 2021 25,805,877 82,859,049 2,148,220 (65,718,962) 45,094,184 (2,330,674) 42,763,510
EQTEC plc
Unaudited condensed consolidated statement of cash flows
for the six months ended 30 June 2021
Notes 6 months ended 6 months ended
30 June 2021 30 June 2020
EUR EUR
Cash flows from operating
activities
Loss for the financial period (4,038,562) (1,846,410)
Adjustments for:
Depreciation of property,
plant and equipment 59,596 41,732
Write off of financial liability - (5,691)
Impairment of financial assets - 17,324
Share of loss from equity 2,914 -
accounted investments
Change in fair value of investments 52,846 -
Loss/(gain) on debt for equity 1,404,755 -
swap
Unrealised foreign exchange
movements 328,535 247,712
Operating cash flows before
working capital changes (2,189,916) (1,545,333)
(Increase)/decrease in:
Development costs (1,929,353) (60,643)
Trade and other receivables (840,758) (45,050)
Increase/(decrease) in Trade
and other payables 87,226 1,258,709
Cash used in operating activities
- continuing operations (4,872,801) (392,317)
Finance income (21,711) -
Finance costs 512,414 540,135
Net cash (used in)/generated
from operating activities
- continuing operations (4,382,098) 147,818
Net cash generated from operating
activities - discontinued
operations 21 - 84,821
Cash (used in)/ generated
from operating activities (4,382,098) 232,639
Cash flows from investing
activities
Proceeds from the disposal
of property, plant and equipment - 300,000
Additions to intangible assets (1,000,000) -
Additions to equity accounted (492,000) -
investments
Loans advanced to project (1,283,801) -
development undertakings
Net cash (used in) generated
from investing activities
- continuing operations (2,775,801) 300,000
Net cash generated from investing
activities - discontinued
operations 21 - 3
Net cash (Used in)/generated
from investing activities (2,775,801) 300,003
EQTEC plc
Unaudited condensed consolidated statement of cash flows
for the six months ended 30 June 2021 - continued
Notes 6 months ended 6 months ended
30 June 2021 30 June 2020
EUR EUR
Cash flows from financing activities
Proceeds from borrowings and 1,391,174 -
lease liabilities
Repayment of borrowings and
lease liabilities (2,929,858) (182,232)
Proceeds from issue of ordinary
shares 19,034,484 1,031,274
Share issue costs (1,266,913) (16,207)
Loan issue costs - (30,944)
Interest paid - (7,783)
Net cash generated from financing
activities - continuing operations 16,228,887 794,108
Net cash generated from/(used
in) financing activities - discontinued
operations 21 - (61,861)
Net cash generated from financing
activities 16,228,887 732,247
Net increase/ (decrease) in
cash and cash equivalents 9,070,988 1,264,889
Cash and cash equivalents at
the beginning of the financial
period 6,270,581 608,194
Cash and cash equivalents at
the end of the financial period 15,341,569 1,873,083
Cash and cash equivalents included
in disposal group 21 - (148,765)
Cash and cash equivalents for
continuing operations 15,341,569 1,724,318
EQTEC plc
Notes to the unaudited condensed consolidated financial
statements
1. GENERAL INFORMATION
The unaudited interim condensed consolidated financial
statements of EQTEC plc ("the Company") and its subsidiaries ("the
Group") for the six months ended 30 June 2021 were authorised for
issue in accordance with a resolution of the directors on 27
September 2021.
EQTEC plc ("the Company") is a company domiciled in Ireland. The
Company's registered office is at Building 1000, City Gate, Mahon,
Cork T12 W7CV, Ireland. The Company's shares are quoted on the AIM
market of the London Stock Exchange plc.
The Group is a waste-to-value group, which uses its proven
proprietary Advanced Gasification Technology to generate safe,
green energy from over 50 different kinds of feedstock such as
municipal, agricultural and industrial waste, biomass, and
plastics. The Group collaborates with waste operators, developers,
technologists, EPC contractors and capital providers to build
sustainable waste elimination and green energy infrastructure.
Our income currently comes from the following streams:
gasification technology sales including software, engineering &
design and other related services; maintenance income from
operating plants; and we receive development fees from projects
where we invest development capital. In the future we expect to
receive potential revenue from licensing opportunities and revenue
from live operations where EQTEC has an equity stake in a
plant.
2. BASIS OF PREPERATION
The unaudited interim condensed consolidated financial
statements are for the six months ended 30 June 2020 and are
presented in Euro, which is the functional currency of the parent
company. They have been prepared on a going concern basis in
accordance with International Accounting Standard (IAS) 34 Interim
Financial Reporting.
The annual financial statements of the group are prepared in
accordance with International Financial Reporting Standards (IFRSs)
as adopted by the EU. The condensed set of financial statements has
been prepared applying the accounting policies and presentation
that were applied in the preparation of the Company's published
consolidated financial statements for the financial year ended 31
December 2020, except for the adoption of new standards effective
as of 1 January 2021. The Group has not early adopted any other
standard, interpretation or amendment that has been issued but is
not yet effective.
The financial information contained in this interim statement,
which is unaudited, does not constitute statutory accounts as
defined by the Companies Act, 2014. The interim condensed
consolidated financial statements do not include all the
information and disclosures required in the annual financial
statements and should be read in conjunction with the Group's
financial statements for the financial year ended 31 December 2020.
The financial statements of the Group were prepared in accordance
with IFRSs as adopted by the European Union and can be found on the
Group's website at www.eqtec.com .
The financial information for the six months ended 30 June 2021
and the comparative financial information for the six months ended
30 June 2020 have not been audited or reviewed by the Company's
auditors pursuant to guidance issued by the Auditing Practices
Board. The comparative figures for the financial year ended 31
December 2020 are not the Group's statutory accounts for that
financial year. Those accounts have been reported on by the
Company's auditor and will be delivered to the Company's
Registration Office in due course. The audit report on those
statutory accounts
was unqualified.
The Group incurred a loss on continuing operations of
EUR4,038,562 (1H 2020: EUR1,846,410) during the six-month period
ended 30 June 2021 and had net current assets of EUR17,915,270 (31
December 2020: EUR3,985,440) and net assets of EUR42,763,510 (31
December 2020: EUR25,300,739) at 30 June 2021.
Going concern
The unaudited interim financial statements have been prepared on
the going concern basis, which assumes that the Company will have
sufficient funds available to enable them to continue to trade for
the foreseeable future.
During June 2021 the Company raised GBP16 million (before
expenses) by way of a Placing and Retail Offer. The directors
consider that this is sufficient funding for the Company to
continue as a going concern beyond the twelve months of the date of
this report.
The directors are confident that the funding received by the
Company in June 2021 will ensure that it will continue as a going
concern and that there will be sufficient funding in the Company to
continue to support its activities for the foreseeable future being
not less than twelve months from the date of approval of these
financial statements. The directors have therefore prepared the
financial statements on a going concern basis.
The financial statements do not include any adjustments that
would arise if the Company were unable to continue as a going
concern.
3. BASIS OF CONSOLIDATION
The unaudited interim condensed consolidated financial
statements include the financial statements of the Group and all
subsidiaries. The financial period ends of all entities in the
Group are coterminous.
4. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies used in preparing the
unaudited interim condensed consolidated financial information are
consistent with those disclosed in the Annual Report and Accounts
of EQTEC plc for the financial year ended 31 December 2020, except
for the adoption of new standards and interpretations and revisions
of existing standards as of 1 January 2021 noted below:
New/revised standards and interpretations adopted in 2021
The following amendments to existing standards and
interpretations were effective in the period to 30 June 2021, but
were either not applicable or did not have any material effect on
the Group:
-- Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16:
Interest Rate Benchmark Reform Phase 2;
-- Amendments to IFRS 16: COVID-19 Rent Related Concessions;
The directors do not expect the adoption of the above amendments
and interpretations to have a material effect on the interim
condensed financial statements in the period of initial
application.
Development assets
Development assets are stated at the lower of cost and net
realisable value. Costs represent expenses associated with
engineering, project management, permitting, planning, financing
and other services, incurred in furthering the development of a
project towards financial close. Net realisable value is based on
estimated revenue to be recognized for development services less
further costs expected to be incurred to the financial close of a
project.
5. ESTIMATES
The preparation of the interim condensed consolidated financial
statements requires management to make judgements, estimates and
assumptions that affect the application of policies and reported
amounts of certain assets, liabilities, revenues and expenses
together with disclosure of contingent assets and liabilities.
Estimates and underlying assumptions are reviewed on an on-going
basis. Revisions of accounting estimates are recognised in the
period in which the estimate is revised.
The judgements, estimations and assumptions applied in the
interim financial statements, including the key sources of
estimation uncertainty, were the same as those applied in the
Group's last annual financial statements for the financial year
ended 31 December 2020.
6. SEGMENT INFORMATION
Information reported to the chief operating decision maker for
the purposes of resource allocation and assessment of segment
performance focuses on the products and services sold to customers.
The Group's reportable segments under IFRS 8 Operating Segments are
as follows:
Technology Sales: Being the sale of Gasification Technology and
associated Engineering and Design Services;
Power Generation: Being the development and operation of
renewable energy electricity and heat generating plants.
The chief operating decision maker is the Chief Executive
Officer. Information regarding the Group's current reportable
segment is presented below. The following is an analysis of the
Group's revenue and results from continuing operations by
reportable segment:
Segment Revenue Segment Profit/(Loss)
6 months ended 6 months ended
30 June 2021 30 June 2020 30 June 30 June
2021 2020
EUR EUR EUR EUR
Technology Sales 481,720 770,308 (427,114) (407,482)
Power Generation - - (185) (4,565)
Total from continuing
operations 481,720 770,308 (427,299) (412,047)
Central administration costs and directors'
salaries (1,783,089) (997,184)
Impairment of financial investments - (17,324)
Other income - 45,810
Change in fair value of investments (52,846) -
Other gains and losses (1,404,755) -
Foreign currency gains/(losses) 123,044 74,470
Share of loss of equity accounted (2,914) -
investments
Finance income 21,711 -
Finance costs (512,414) (540,135)
Loss before taxation (continuing operations) (4,038,562) (1,846,410)
6. SEGMENT INFORMATION - continued
Revenue reported above represents revenue generated from
associated undertakings and external customers. Inter-segment sales
for the financial period amounted to EURNil (2020: EURNil).
Included in revenues in the Technology Sales Segment are revenues
of EURNil (2020: EUR691,163) which arose from sales to North Fork
Community Power LLC,, an associate undertaking of EQTEC plc.
Segment profit or loss represents the profit or loss earned by
each segment without allocation of central administration costs and
directors' salaries, other operating income, share of losses of
jointly controlled entities, investment revenue and finance costs.
This is the measure reported to the chief operating decision maker
for the purposes of resource allocation and assessment of segment
performance.
Other segment information:
Depreciation and amortisation Additions to non-current
assets
6 months ended 6 months ended
30 June 30 June 30 June 30 June
2021 2020 2021 2020
EUR EUR EUR EUR
Technology sales 41,732 41,732 - 14,878
Power Generation - - - -
Head Office 17,864 - 2,658,570 5,119
59,596 41,732 2,658,570 19,997
The Group operates in four principal geographical areas:
Republic of Ireland (country of domicile), Spain, United States and
the United Kingdom. The Group's revenue from continuing operations
from external customers and information about its non-current
assets* by geographical location are detailed below:
Revenue from Associates Non-current assets*
and External Customers
6 months 6 months
ended ended As at As at
30 June 30 June 2020 30 June 2021 31 December
2021 2020
EUR EUR EUR EUR
Republic of - - 2,443,832 -
Ireland
Spain 481,720 79,145 146,061 187,792
United States - 691,163 - -
United Kingdom - - 198,750 -
481,720 770,308 2,788,643 187,792
*Non-current assets excluding goodwill, financial instruments,
deferred tax and investment in jointly controlled entities and
associates.
The management information provided to the chief operating
decision maker does not include an analysis by reportable segment
of assets and liabilities and accordingly no analysis by reportable
segment of total assets or total liabilities is disclosed.
7. OTHER GAINS AND LOSSES 6 months 6 months ended
ended
30 June 30 June 2020
2021
EUR EUR
(Loss)/Gain on debt for equity swap (1,404,755) -
During the financial year the Group extinguished some of its
borrowings by issuing equity instruments. In accordance with IFRIC
19 Extinguishing Financial Liabilities with Equity Instruments, the
loss recognised on these transactions was EUR1,404,755 (H1 2020:
gain of EURNil).
8. INCOME TAX 6 months 6 months ended
ended
30 June 30 June 2020
2021
EUR EUR
Income tax expense comprises:
Current tax expense - -
Deferred tax credit - -
Adjustment for prior financial periods - -
Tax expense - -
An income tax charge does not arise for the six months ended 30
June 2021 or 30 June 2020 as the effective tax rate applicable to
expected total annual earnings is Nil as the Group has sufficient
tax losses coming forward to offset against any taxable profits. A
deferred tax asset as not been recognised for the losses coming
forward.
9. LOSS PER SHARE 6 months 6 months
ended ended
30 June 2021 30 June 2020
EUR per share EUR per share
Basic loss per share
From continuing operations (0.0005) (0.0005)
From discontinued operations - -
Total basic loss per share (0.0005) (0.0005)
Diluted loss per share
From continuing operations (0.0005) (0.0005)
From discontinued operations - -
Total diluted loss per share (0.0005) (0.0005)
The loss and weighted average number of ordinary shares used in
the calculation of the basic and diluted loss per share are as
follows:
6 months ended 6 months ended
30 June 2021 30 June 2020
EUR EUR
Loss for period attributable to
equity holders of the parent (4,037,800) (1,819,363)
Profit for the period from discontinued
operations used in the calculation
of basic earnings per share from
discontinued operations - 24,827
Losses used in the calculation
of basic loss per share from continuing
operations (4,037,800) (1,844,190)
No. No.
Weighted average number of ordinary
shares for
the purposes of basic loss per
share 7,358,418,295 3,989,442,933
Weighted average number of ordinary
shares for
the purposes of diluted loss per
share 7,358,418,295 3,989,442,933
Dilutive and anti-dilutive potential ordinary shares
The following potential ordinary shares were excluded in the
diluted earnings per share calculation as they were
anti-dilutive.
30 June 2021 30 June 2020
Share warrants in issue 663,310,335 576,876,933
Convertible loans in issue - 235,991,940
Total anti-dilutive shares 663,310,355 812,868,873
Events after the balance sheet date
128,380,000 ordinary shares were issued after the period end. If
these shares were in issue prior to 30 June 2021, they would have
affected the calculation of the weighted average number of shares
in issue for the purposes of calculating both the basic loss per
share and diluted loss per share by 21,396,667.
10. PROPERTY, PLANT AND EQUIPMENT
During the six-month period ended 30 June 2021, the Group acquired
right-to-use assets financed through leases to the value of EUR214,378.
11. GOODWILL
Included are the following amounts relating to goodwill:
30 June 2021 31 December
2020
Cost EUR EUR
At start and at end
of the financial period 16,710,497 16,710,497
Accumulated impairment
losses
At start of the financial
period 1,427,038 1,427,038
Impairment losses - -
At end of the
financial period 1,427,038 1,427,038
Carrying value
At start and at end
of the financial period 15,283,459 15,283,459
12. OTHER INTANGIBLE ASSETS
During the six-month period ended 30 June 2021, the Group
acquired intellectual property rights valued at EUR2,443,832 as
part of a settlement with Syngas Technology Engineering, S.L., a
company wholly owned and controlled by Dr. Yoel Alemán, a director
of the Company.
13. FINANCIAL ASSETS
During the six-month period ended 30 June 2021, the Group
acquired the following financial assets:
a) Investment in MetalNRG plc
On 17 May 2021, the Company acquired 60,606,061 shares in
MetalNRG plc in exchange for 27,932,961 Ordinary Shares of the
Company.
b) Investment in EQTEC Italia MDC srl
During the six-month period ended 30 June 2021, the Group
acquired a 20.02% share in an associate company, EQTEC Italia MDC
srl. In addition, the Group advanced a loan of EUR482,000 to EQTEC
Italia MDC srl. The loan is for a term of 36 months and the
principal and any accrued interest are repayable in full on 18 June
2026, but EQTEC Italia MDC srl can repay the loan early without
penalty. The loan is unsecured and has a coupon rate of 4% per
annum, payable on termination of the loan.
14. INVESTMENT IN ASSOCIATED UNDERTAKINGS
Details of the Group's interests in associated undertakings at
30 June 2020 is as follows:
Name of associated Country of Shareholding Principal activity
undertaking incorporation
North Fork Community United States 19.99% Operator of biomass
Power LLC of America gasification power project
EQTEC Italia Italy 20.02% Operator of biomass
MDC srl gasification project
For the first five years of operation, the share of profits
from North Fork Community Power LLC is limited to 0.1999%
rising to 19.99% thereafter.
Summarised financial information in respect of the Group's
interests in associated undertakings is as follows:
30 June 31 December
2021 2020
EUR EUR
Non-current assets 699,829 44,552
Current assets 20,738,537 17,686,647
Non-current liabilities (19,298,707) (16,213,836)
Current liabilities (422,135) (263,150)
Net assets 1,717,524 1,254,213
Group's share of net assets of associated
entities 343,344 250,717
6 months ended 6 months ended
30 June 2021 30 June 2020
EUR EUR
Total revenues 18,567 12,721
Total expenses (31,664) (2,461)
Total (loss)/profit for the financial
period (13,097) 10,260
Group's share of (losses)/profits (2,914) -
of associated entities
The investments in North Fork Community Power LLC and EQTEC
Italia MDC srl are accounted for using the equity method in
accordance with IAS 28.
The associates have not yet commenced to fully trade.
15. DEVELOPMENT ASSETS
30 June 31 December
2021 2020
EUR EUR
Costs associated with project development
2,433,006 503,653
Loan receivable from project development
undertakings 1,809,746 482,537
The Group uses its expertise in engineering, project management,
permitting, planning and financing to develop waste to value
projects. Once the projects reach a certain level of maturity,
third party investors are allowed invest in the project SPV. The
Group charges a premium to the project SPV for the development
services over and above the costs incurred in developing the
project.
Costs associated with project development, including loans
advanced to project undertakings (together "Total Project Costs")
comprise expenses associated with engineering, project management,
permitting, planning, financing and other services, incurred in
furthering the development of a project towards financial close.
Total Project Costs set out above represent the cost of delivery of
project development services and are transferred to cost of sales
when the project SPV is invoiced by the Group for project
development work.
Included in loans receivable from project development
undertakings is an amount of EUR200,000 which is receivable, along
with accrued interest, 12 months from the date of drawdown.
Interest is charged at 15% per annum. At 30 June 2021, the loan is
valued at EUR228,274 (31 December 2020: EUR213,297).
The remaining loans receivables were issued with no interest and
no fixed repayment date.
16. TRADE AND OTHER RECEIVABLES 30 June 31 December
2021 2020
EUR EUR
Trade receivables - gross 615,407 638,602
Allowance for credit losses (475,687) (475,687)
Trade receivables - net 139,720 162,915
VAT receivable 456,121 172,405
Deferred consideration for the disposal of
Pluckanes Windfarm Limited 126,572 120,424
Advances to related undertakings 60,100 60,000
Allowance for credit losses (60,000) (60,000)
Prepayments 241,798 133,403
Corporation tax 2,376 6,841
Payments on account 400,023 120,798
Other receivables 375,265 177,745
1,741,975 894,531
Included in other receivables is an amount of EUR302,871 (31
December 2020: EUR11,294) being a deposit towards the purchase of
land on which the proposed up to 25 MWe Billingham waste
gasification and power plant at Haverton Hill, Billingham, UK, will
be constructed.
17. EQUITY
During the 6-month period ended 30 June 2021, 1,450,322,620
shares (6 months ended 30 June 2020: 300,400,000 shares) were
issued
as follows:
Amounts of shares 6 months ended 6 months ended
30 June 2021 30 June 2020
Ordinary Shares of EUR0.001 each issued
and fully paid
* Beginning of the period 6,977,439,598 3,939,376,266
* Issued on exercise of warrants for cash 156,773,543 300,400,000
46,884,149 -
* Issued on exercise of employee share warrants for
cash
152,075,311 -
* Issued in settlement of suppliers and other creditors
27,932,961 -
* Issued in exchange for shares in other entity
1,066,666,656 -
* Share issue for cash - public and private placement
Total Ordinary shares of EUR0.001 each
authorised, issued and fully paid at
the end of the period 8,427,772,218 4,239,776,266
18. BORROWINGS
During the six months ended 30 June 2021, the following occurred
in relation to debt securities:
On 4 January 2021, the Company announced that it had agreed an
unsecured loan facility of GBP1.25 million with Altair Group
Investment Limited, a substantial shareholder in the Company. The
Loan Facility was for a term of 12 months and the principal and any
accrued interest were repayable in full on 31 December 2021. The
Loan Facility was unsecured and had a coupon rate of 6% per annum,
payable quarterly in arrears. The Loan Facility was used to pay all
sums due under the previous Secured Loan Facility that was in place
at that time releasing and discharging any secured assets and
obligations.
During the period all amounts due and owing under the unsecured
loan facility were repaid in full.
19. LEASES
During the six-month period ended 30 June 2021, the Group
acquired right-to-use assets financed through leases to
the value of EUR214,378.
Lease liabilities are presented in the statement of financial
position as follows:
30 June 31 December
2021 2020
Group EUR EUR
Current 193,849 85,242
Non-current 154,799 106,465
348,648 191,707
The Group has a lease for its offices in Iberia, Spain and
London, United Kingdom. The lease liabilities are secured by the
related underlying asset. Further minimum lease payments at 30 June
2021 were as follows:
Minimum lease payments due
Within 1-2 years 2-3 years 3-4 4-5 After Total
1 year years years 5 years
EUR EUR EUR EUR EUR EUR EUR
30 June 2021
Lease payments 201,657 156,819 - - - - 358,476
Finance charges (7,808) (2,020) - - - - (9,828)
Net Present
Values 193,849 154,799 - - - - 348,648
31 December
2020
Lease payments 89,828 89,828 18,714 - - - 198,370
Finance charges (4,586) (1,993) (84) - - - (6,663)
Net Present
Values 85,242 87,835 18,630 - - - 191,707
20. TRADE AND OTHER PAYABLES
Included in trade and other payables at 30 June 2021 is an
amount of EUR2,341,427 (GBP2,010,000) (31 December
2020:EUR2,237,006) relating to consideration payable under the
share purchase contract to acquire Logik WTE Limited.
21. DISPOSAL GROUP CLASSIFIED AS HELD FOR RESALE AND DISCONTINUED OPERATIONS
The amounts presented in the condensed consolidated statement of
profit or loss and the condensed consolidated statement of cash
flows under discontinued operations relates to its former subsidiary,
Pluckanes Windfarm Limited, which was disposed of on 24 August 2020.
22. RELATED PARTY TRANSACTIONS
The Group's related parties include Altair Group Investment
Limited ("Altair"), who at 30 June 2020 held 20% of the shares in
the Company, the associate companies and key management.
Transactions with Altair
During the six-month period ended 30 June 2021, Altair advanced
EUR1,391,173 (H1 2020: EURNil) by way of borrowings; this loan was
repaid in the period. Interest payable to Altair for the six-month
period ended 30 June 2021 amounted to EUR28,571 (H1 2020:
EUR167,783); this includes a reprofiling fee of EURNil (H1 2020:
EUR106,321) regarding the reprofiling of the debt facility that
took place on 1 June 2020.
22. RELATED PARTY TRANSACTIONS - Continued
Transactions with associate undertakings
During the six-month period ended 30 June 2021, the Company
booked in revenue EURNil (Six months ended 30 June 2020:
EUR691,163) from its associated undertaking, North Fork Community
Power LLC, on the sale of equipment and the supply of engineering
and design services. During the six-month period ended 30 June
2021, the Group advanced EUR202,169 (H1 2020: EURNil) to North Fork
Community Power LLC by way of a loan. Included in loans receivable
from project undertakings is an amount of EUR237,436 (31 December
2020: EUR30,201) due from North Fork Community Power LLC.
During the six-month period ended 30 June 2020, the Company
recharged costs of EUR93,148 (H1 2020: EURNil) to its associated
undertaking, EQTEC Italia MDC srl. Included in trade and other
receivables at 30 June 2021 is EUR93,148 due from EQTEC Italia MDC
srl (31 December 2020: EURNil).
During the six-month period ended 30 June 2020, the Company
advanced a loan of EUR482,000 (H1 2020: EURNil) to its associated
undertaking, EQTEC Italia MDC srl, and accrued interest income of
EUR687 (H1 2020: EURNil). Included in financial assets at 30 June
2021 is EUR482,687 due from EQTEC Italia MDC srl (31 December 2020:
EURNil).
Transactions with key management
A company controlled by a director, Mr. D Palumbo, provided
office space for the Group in London. The cost of these services
for the six-month period ended 30 June 2021 amounted to EUR12,566
(H1 2020: EUR9,091). At 30 June 2021, an amount of EURNil (31
December 2020: EUR3,172) is included in trade and other payable
with respect to payments due to this company.
A company controlled by a director, Mr J Vander Linden, had
provided advisory services to the Group prior to being appointed
director. The cost of the services for the six-month period ended
30 June 2021 amounted to EURNil. Included in trade and other
payables at 30 June 2021 is an amount of EURNil (31 December 2020:
EUR63,883) with respect to payments due to this company. The
balance at 31 December 2020 was settled through the issue of new
ordinary shares of EUR0.001 each in the capital of the Company on 1
February 2021.
During the six-month period ended 30 June 2021, the Group
entered into a royalty settlement arrangement, to the tune of
EUR2,443,832, with Syngas Technology Engineering, S.L. (a company
controlled by Dr. Yoel Alemán, the Group's CTO and current Board
Director). This balance was settled through a cash payment of
EUR1,000,000 with the remainder through the issue of new ordinary
shares of EUR0.001 each in the capital of the Company on 3 June
2021.
Mr I Pearson, provided consultancy services to the Group during
H1 2021 amounting to EUR116,261 (H1 2020: EURNil). Included in
trade and other payables at 30 June 2021 is an amount of EURNil (31
December 2020: EURNil) with respect to payments due to him.
23. CONTINGENT LIABILITIES
On 13 July 2020, the Group announced that lawyers acting for Aries
Clean Energy LLC of Franklin, Tennessee, USA ("Aries") filed a
complaint in a Californian court on 9 July 2020 against the Company
and others, alleging patent infringement through the use of the
Group's Advanced Gasification Technology in the North Fork Community
Power plant in California USA.
On 22 March 2021 the Company announced the Aries had withdrawn
its patent infringement complaint. The joint stipulation that
the action be voluntarily dismissed with prejudice was filed in
the United States District Court Eastern District of California
on 19 March 2021 and operates as a final determination on the
merits of the case, forbidding Aries from filing another lawsuit
on the same grounds.
24. EVENTS AFTER THE BALANCE SHEET DATE
No adjusting or significant non-adjusting events have occurred
until the date of authorisation of these financial statements.
25. APPROVAL OF FINANCIAL STATEMENTS
The condensed consolidated financial statements for the six
months ended 30 June 2021, which comply with IAS 34, were approved
by the Board of Directors on 27 September 2021.
ENQUIRIES
EQTEC plc +44 203 883 7009
David Palumbo / Nauman Babar
-----------------------
Strand Hanson - Nomad & Financial Adviser +44 20 7409 3494
-----------------------
James Harris / James Dance
-----------------------
Arden Partners - Joint Broker +44 20 7614 5900
-----------------------
Paul Shackleton (Corporate) / Simon Johnson
(Sales)
-----------------------
Canaccord Genuity - Joint Broker +44 20 7523 8000
-----------------------
Henry Fitzgerald-O'Connor / James Asensio
/ Patrick Dolaghan
-----------------------
Alma PR - Financial Media & Investor Relations +44 20 3405 0205
-----------------------
Josh Royston / Sam Modlin EQTEC@almapr.co.uk
-----------------------
+44 7554 014 188 / +44
BECG - General Media Enquiries 7867 452 269
-----------------------
Carrie Lowe / Tom Gosschalk EQTEC@BECG.com
-----------------------
About EQTEC plc
As one of the world's most experienced gasification technology
and engineering companies, with a growing track record of
delivering operational and commercial success for transforming
waste-to-energy through best-in-class technology innovation,
engineering and project development , EQTEC brings together design
innovation, project delivery discipline and solid commercial
experience to add momentum to the global energy transition. EQTEC's
proven, proprietary and patented technology is at the centre of
clean energy projects, sourcing local waste, championing local
businesses, creating local jobs and supporting the transition to
localised, decentralised and resilient energy systems.
EQTEC designs, supplies and builds advanced gasification
facilities in the UK, EU and US, with highly efficient equipment
that is modular and scalable from 1MW to 30MW. EQTEC's versatile
solutions process over 50 varieties of feedstock, including
forestry wood waste, vegetation and other agricultural waste from
farmers, industrial waste and sludge from factories and municipal
waste, all with no hazardous or toxic emissions . EQTEC's solutions
produce a pure, high-quality synthesis gas ("syngas") that can be
used for the widest range of applications, including the generation
of electricity and heat, production of synthetic natural gas
(through methanation) or biofuels (through Fischer-Tropsch,
gas-to-liquid processing) and reforming of hydrogen.
EQTEC's technology integration capabilities enable the Group to
lead collaborative ecosystems of qualified partners and to build
sustainable waste reduction and green energy infrastructure around
the world.
The Company is quoted on AIM (ticker: EQT) and the London Stock
Exchange has awarded EQTEC the Green Economy Mark, which recognises
listed companies with 50% or more of revenues from
environmental/green solutions.
Further information on the Company can be found at www.eqtec.com
.
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END
IR KDLFLFKLXBBV
(END) Dow Jones Newswires
September 28, 2021 02:00 ET (06:00 GMT)
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