(Alliance News) - PipeHawk PLC shares dropped on Monday following a delay in production of the 'Ventive Home' system, which was due to begin in June 2022 and is now scheduled to start in September 2023.
PipeHawk is a Hampshire, England-based provider of technology for highways and for the automotive, rail and aerospace industries. Its shares were down 14% to 13.39 pence each in London on Monday morning.
Back in March, PipeHawk's subsidiary QM Systems Ltd signed a contract with ventilation systems specialist Ventive Ltd for the second phase of its project. It said it would manufacture a green energy product to provide domestic heating and hot water for Ventive.
At the time, PipeHawk said it expected the contract to deliver revenue of GBP7.5 million in the twelve months ending June 30, 2023.
In December 2021, the company announced the first phase of the manufacturing deal with Ventive. This involved QM Systems and Ventive working together to produce a system for manufacturing the product.
On Monday, PipeHawk said that Ventive needs to raise additional development capital for production of the system, and it is at an "advanced stage" of discussions to secure this funding.
However, this process has taken longer the originally anticipated, the company said.
Therefore, production of the Ventive Home system, which was scheduled to begin in June 2022, is now expected to commence in September 2023. It anticipates the product coming to market in the fourth quarter of 2023 and revenue from the contract to accrue in its financial year ending June 30, 2023.
Chair Gordon Watt said: "While I am disappointed that the timing of production has been delayed for this project which has delayed the commencement of revenue for PipeHawk, I do recognise the challenges faced when bringing new and innovative disruptive technology to market. As a business, we thrive on being at the forefront of technological development, in particular where that technology has the capacity to have positive impact on our world."
By Sophie Rose; sophierose@alliancenews.com
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PipeHawk (PIP)