LONDON (Alliance News) - Ceramic Fuel Cells Ltd Wednesday said it cut its net operating cash outflow during the fourth quarter of its financial year as sales rose and it made progress on cutting costs, and it also said it is talks about developments that may lead to it becoming a multiple product business.
The company, which makes small-scale generators that use proprietary fuel cell technology to convert natural gas into electricity and heat for homes and small commercial buildings, launched a restructuring in March after admitting that it wasn't achieving sustainable sales. It cut staff and operational and production costs.
This started paying off in the three months to end-June, and the company, which is listed on AIM and the Australian Securities Exchange, said more savings will be realised in coming months.
Net operating cash outflow for the fiscal fourth quarter to end-June was AUSD3.0 million, or GBP1.6 million, a big improvement on the AUD8.1 million, or GBP4.4 million outflow in the three months to end-March.
"The board continues its strategic review of the company's financial and operational needs along with its pursuit of joint venture possibilities with partners who are willing to pay for the company's technology or can add significant synergies to the company's operations," it said in a statement.
It added that it has also been approached about developing larger capacity units for some markets, but this will require new funding and it talking with a number of organisations about securing "appropriate" financial support. It said these activities may lead to it becoming a multiple product business.
It sold 71 units in the fiscal fourth quarter, bringing the total for the whole financial year to 210 units, up from 147 in fiscal 2013.
"Whilst this is a substantial improvement on the March quarter's 15 units, the company has previously acknowledged that this level of sales will not sustain the business and is focusing its limited sales resources on large, project-based sales in both the UK and Europe. Development of these large-scale projects is progressing and the board is confident that a number of these targeted projects will be converted into orders in the near future," it said.
Its cash position at the end of June stood at AUD5.3 million, or GBP2.9 million, up from AUD2.3 million, or GBP1.3 million, at the end of March.
Ceramic Fuel Cells got a boost recently when it announced substantial reductions in degradation rates following the introduction of patented improvements to its BlueGEN product. It is currently introducing the improvements into its supply chain and will then incorporate them into routine stack production. It thinks the improvements will reduce the size of the warranties it gives per unit.
The company's AIM-listed shares were flat at 0.675 pence Wednesday.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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