LONDON (Alliance News) - Clean Air Power Ltd said Tuesday that its pretax loss widened in the first-half as revenue rose, buoyed by increased sales of its Dual-Fuel system.
Clean Air Power designs, develops and delivers compression-ignited natural gas engines for heavy duty transport applications.
In its half-year results for the six months to June 30, the company said its pretax loss widened to GBP2.2 million from the GBP1.1 million loss recorded the previous year.
Clean Air Power was hit by increased costs of sales, which came in at GBP3.2 million compared to GBP2.1 million for the same period in 2013. The increase was due to a change in sales mix and the release of a one-off provision within its components segment, said the company.
Revenue during the period rose to GBP4.5 million from GBP4.1 million from the same period in 2013. "This uplift has been the result of a change in sales mix following an increase in sales of our Genesis-EDGE product in the UK during the first-half of 2014," said the company in a statement.
Clean Air Power's Dual-Fuel and MicroPilot technologies enable engines to run on natural gas mixed with diesel, or any suitable combustion fuel, providing the "spark" that ignites the gas.
Revenue from the Dual-Fuel system sales rose 17% during the period to GBP3.2 million from GBP2.7 million the prior year.
The company records increased earnings before interest, taxation, depreciation and amortisation, up 18% to GBP1.3 million from GBP1.1 million in 2013 as the company's staff costs increased as it focuses on new markets.
Since the period-end the company successfully completed a GBP1.0 million equity raise in July 2014 to provide additional working capital headroom that will allow the group to "take advantage of opportunities as they arise."
Excluding the equity raise, the company recorded its cash position at GBP3.2 million as at June 30, compared to GBP4.0 million as at December 31, 2013.
Looking ahead Clean Air Power Chief Executive John Pettitt said that the business remains in a difficult and challenging transitional period as it tries to work with "the increasing "lumpiness" of operating in a European market at the end of its product lifecycle whilst managing the build up to product launch in two new, sizable and attractive markets in the US and Russia."
However, while challenges exist, the company remains confident about the US and Russia markets, stating that whilst it is "difficult to predict precisely the rate at which we expect these markets to grow, by working through distribution partners who understand their local markets and retain strong customer relationships, we believe we have the right operating model to capitalise on these sizable markets that are committed to natural gas as a road fuel."
Shares in Clean Air Power were Tuesday trading 13.05% lower at 2.07 pence per share.
By Alice Attwood; aliceattwood@alliancenews.com; @AliceAtAlliance
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