(Alliance News) - redT Energy PLC said Friday its interim loss narrowed on reduced costs and flat revenue, as the company prepares for its proposed merger with Avalon Battery Corp.
For the six months to the end of June, the energy storage firm's pretax loss was GBP3.8 million, narrowed from GBP5.5 million the year before.
This was due to a 28% reduction in administrative expenses to GBP4.1 million, as well as a one-off gain of GBP578,000 on the sale of the Camco US business.
During the period, following a strategic review in March, redT implemented a cost cutting exercise to reduction operating costs. This process involved a redundancy process which reduced staff costs by 25%.
Revenue for the period was GBP192,000, in line with the year before.
Looking ahead, redT said it is necessary for the company to raise additional financing to fund operations until production and sales are increased to a level at which it becomes cash generative.
In addition, in late July redT announced a planned merger with Avalon Battery. Avalon is based in California and has "very similar" technology to that of redT.
The merger is a share-for-share acquisition of Avalon by redT, with redT shares valued at 1.65 pence each, valuing Avalon at USD37.5 million.
"The global energy storage market is continuing its rapid growth as our energy system progresses strongly towards widespread decarbonisation. I am highly optimistic about the growing role our products will play in the inevitable global energy transition and retain my confidence in the redT team's ability to deliver shareholder value," said Executive Chair Neil O'Brien.
"It is my strong belief the proposed merger with Avalon and accompanying fundraise, if successful, will create a strong and financially robust company that will become a leader in the vanadium redox flow sector, and can compete effectively in one of the world's fastest growing markets," O'Brien added.
Shares in redT Energy are currently suspended in London due to the merger.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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