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Well if their Basic questions and you can’t answer them yourself, you are as daft as you sound.
If you have so much concern why you even asking, or here.

Smart person would be looking somewhere else for a money maker.

You are a muppet.

And it’s easy to see what you are trying to do.
Repeating yourself ain’t getting you no where.

WE’VE HEARD IT ALL BEFORE....

· a focus on transportation and the exponential growth in Electric Vehicles ("EVs") - bringing with it opportunities and challenges; and

· the clear transitionary drive away from fossil fuel based off-grid and distributed power generation to cleaner hybrid and standalone clean energy technologies.

This year was therefore focused on delivering products to the market that clearly addressed the needs of these three criteria and challenges.

This commenced with the early demonstration of a prototype EV charger unit at AFC Energy's headquarters in January 2019, which in turn led to a strong degree of interest from the market to validate investment in the Company's first commercially deployable unit launched later that year in December 2019.

Our interactions with potential customers have identified common challenges such as predicting future EV charging demand, investment required to upgrade existing infrastructure and lead time to deliver grid reinforcement. This highlights the opportunity that exists in this market to support the wider decarbonisation of the EV market. Our own internal due diligence in this area comes directly from discussions with EV charge point operators, car park owners, fleet operators, and local governments, who all consistently arrive at the same conclusion - there is a strong market opportunity in being able to meet short to medium term demand for off grid, rapid EV charging in support of or instead of local electrical networks and grids.

For this reason, having achieved multiple milestones in our technology development throughout the course of 2019, including with our partners Industrie De Nora, the majority of our financial and human resources throughout the year have focused on accelerating a product that addresses these short term needs into the EV rapid charging market.

At the time of writing this review, I'm pleased to say we succeeded in demonstrating our first 20kW fuel cell system and we are completing a national roadshow of the system to several hundreds of prospective customers and partners.

2020 is now expected to be the year in which several of these commercial enquiries are transitioned into contracts for delivery of fuel cell systems into the market and whilst we continue to maintain an interest and capability in deploying systems into the larger petrochemical and industrial markets where hydrogen is a by-product, our ability to achieve short term successful deployment into the distributed power and EV charging markets, together with a first mover advantage, makes for an exciting and opportunistic year ahead.

The Market Landscape

It was a pleasure in January 2020 to represent AFC Energy in Versailles, at the Hydrogen Council's annual meeting of over 80 CEOs and senior executives. Coined "the Decade of Hydrogen" and having such a high calibre of executives and decision makers around the table made it clear to me and all who

Current end user demand can be satisfied by our current product offering but all our prospective customers recognise that they will need to continue to invest in more infrastructure in the coming years as the number of electric vehicles grows. Our strategy is to develop long term relationships and work alongside our customers to minimise their investment risk and as such grow together. The uncertainty over future demand, the elevated cost of grid reinforcement and the timeline to deliver those upgrades for our customers has slowed their decision making but on the other hand highlights the unique selling points of our product, namely, flexible, low risk, modularised, re-deployable emissions free electricity generation. As reported last year we have been re-evaluating our distribution partners and we are working with several companies in the electric vehicle space to identify and develop opportunities.

Management

We were pleased that Dr Gerry Agnew has joined as a non-executive director and is regarded as one of the world's leading experts in the field of fuel cell technology and systems following a long and successful career at both Rolls-Royce and LG Fuel Cell Systems Inc. We are also pleased to confirm that Graeme Lewis, our Chief Financial Officer, has agreed to join our Board.

We have bid farewell this year to Percy Hayball and Lisa Jordan, representatives of Ervington Investments Limited, from the Board and I would like to thank them personally for the contributions they have made over the past few years.

Funding

Through prudent management of our expenditure we have been able to meet our daily financing requirements without resort to the equity financing facility announced in early 2019. However, we consume cash resources and will continue to do so until such time as sales revenues are sufficient to cover our expenditure and as such, we are dependent on the support of our shareholders. We thank our shareholders for their current and continuing support.

Outlook

Last year I thanked the staff for their commitment and dedication in challenging circumstances. This year I would like to congratulate them on their determination, innovation and creativity, as well, which has enabled them to deliver the EV Charging demonstration unit which is tangible evidence of their professionalism.

I believe these same attributes will now support our commercial actions and look forward to seeing the fruits of their labours.

John Rennocks

Chairman

CHIEF EXECUTIVE OFFICER'S REPORT

AFC Energy's commercial success is predicated on clearly defining the right product, at the right price, for the right markets and I am delighted to report that 2019 has ratified the strategic decisions taken in prior years in this context.

We can now see a clear path for AFC Energy to capitalise on the multi-facetted challenge facing today's energy sector which include:

2020 is now expected to be the year in which several of these commercial enquiries are transitioned into contracts for delivery of fuel cell systems into the market and whilst we continue to maintain an interest and capability in deploying systems into the larger petrochemical and industrial markets where hydrogen is a by-product, our ability to achieve short term successful deployment into the distributed power and EV charging markets, together with a first mover advantage, makes for an exciting and opportunistic year ahead.

The Market Landscape

It was a pleasure in January 2020 to represent AFC Energy in Versailles, at the Hydrogen Council's annual meeting of over 80 CEOs and senior executives. Coined "the Decade of Hydrogen" and having such a high calibre of executives and decision makers around the table made it clear to me and all who attended that today is the seminal moment in the future of Hydrogen within the global energy industry.

Public knowledge and acceptance of hydrogen technologies is growing year on year, particularly in the growth markets of China and Europe, and with cost projections of hydrogen based solutions expected to halve over the next decade through scale up in production, distribution and manufacturing, the commercial opportunities for fuel cells has never been greater.

At home in the United Kingdom, AFC Energy's key markets, EV Charging and Distributed Off Grid Power Generation, are also growing at a rapid rate with several Government policy developments aligned and supportive of our deployment strategy. In February 2020, the Prime Minister announced an acceleration of the date for the displacement of all new petrol and diesel cars to 2035; based on our enquiries to date, we know this is going to create new and accelerated interest in our off grid EV charging solution, particularly across Local Councils, fleets and car park operators.

The transition of AFC Energy's target market focus over the past twelve to twenty-four months towards premium priced power solutions continues to be validated and we remain optimistic that short term deployment potential will remain the focus of our Company into 2020.

Electric Vehicle Charging - A Growth Market

We are often asked whether AFC Energy is for or against the introduction of hydrogen fuel cell vehicles due to its own focus on battery electric vehicles. We believe both technologies have a role to play in the aspiration of decarbonising transport, however, it is clear based on the growth in EVs in the UK and elsewhere that we see in the market today, that EVs are not simply a transitionary technology, but will be part of the longer term transportation network for many decades to come. This does however create challenges.

In the UK Government's recent Electric Vehicles Energy Taskforce (January 2020), the Taskforce stressed the likely challenges EVs will place on the electricity distribution netwo

MSP Technologies and our control systems supplier have both invested in non-recurring engineering expenditure to ensure that their products are seamlessly connected with our fuel cell. Furthermore, their staff integrated with our engineering team and provided invaluable support during commissioning.

I would like to take this opportunity to thank our supply chain partners for their continuing support and commitment to meet an aggressive rollout timeline. Without their commitment we would not have been able to demonstrate the full range of our integrated product before Christmas.

Fuel supply partners

One of our key competitive advantages compared to other fuel cells is our ability to accept low purity hydrogen. This year we have begun to develop relationships with various parties to develop distributed hydrogen production. This began earlier in the year sharing information about ammonia to power with an international OEM and culminated in our entering into a joint development agreement with HiiROC to use their plasma technology in EV charging. These initiatives coupled with traditional hydrogen sources give us confidence in the predictions made by McKinsey in a report prepared for the Hydrogen Council that Hydrogen prices are set to dramatically fall in the coming years.

Technological roadmap

In our quest to provide cost effective innovative solutions for our customers earlier this year we announced the initial results of our investigation and development of the solid membrane technology. We continue to work on this initiative, and we have been approached by various bodies to test the technology in electrodialysis and electrolysis applications. We are excited by this breakthrough as it not only represents a significant reduction in the fuel cell footprint but also provides an entrée into the hydrogen production market through electrolysis. Being able to participate both in the hydrogen production and consumption markets reduces our exposure to hydrogen pricing.

Commercial and distribution

I have left until last my comments on the commercial market not because it is unimportant but rather to lay out the firm foundations upon which we are setting out our market stall. This year has seen a significant step forward as the demonstration day in December 2019 showed that we have a product that works, meets a real need, in a premium priced market where there is no established competitor. Following the demonstration, we have signed several non-disclosure agreements with both public and private entities where we are sharing information and developing tailored solutions built around our flexible modularised design. These applications range from charging hubs for taxis, powering trains, en route charging on motorways, urban destination charging and fleet charging. Current end user demand can be satisfied by our current product offering but all our prospective customers recognise that they will need to con

CHAIRMAN'S REPORT

I am pleased to report that we have concluded the period ended 31st October 2019 with technical advances, market readiness, a reduction in operating loss culminating in a successful demonstration of our EV charger solution and strong commercial interest. All of which has been achieved without making any drawdown from our £ 4 million equity financing facility. Our strategic focus and key performance measures are in the short term to conclude the design and rollout of commercial versions of a liquid fuel cell system commencing delivery to customers in 2020. In the longer term, we will continue our innovation in the field of solid membranes for future use in fuel cell and related opportunities complementing our existing product range.

Hydrogen fuelled EV charger

Approximately 20% of all energy consumption is used in transport applications and is at the forefront and a central component of the decarbonisation agenda. Against this background both Government and industry are supporting the early adoption of electric vehicles. To facilitate this change, the simple solution would be to upgrade the Grid but unfortunately this will take both time, financial investment and manpower wherein lies the problem. Our focus is to seize this opportunity by integrating our innovative hydrogen fuelled EV Charger alongside available grid capacity and battery storage to provide a low risk complementary emissions free solution which can grow as EV adoption rates increase. Our flexible modularized solution provides our target customers with an immediate economically viable solution to the twin problems of investing in grid upgrades when faced with uncertain levels of future demand. The Government's recent announcement to shorten the deadline for banning the sale of petrol and diesel vehicles by five years exacerbates the issues and we believe will strengthen the demand for our solutions.

Manufacturing partners

The heart of the charging solution remains our fuel cell which incorporates our latest developments in flow plate design and electrode chemistry. De Nora continue to support our research and have the manufacturing capacity to meet expected future customer demand. Innomech continue to work with us and we have invested in tooling and assembly facilities to ensure that our flow plate manufacturing and integration capability is aligned with our new generation of fuel cell components.

Advanced Plastics' prototype aluminium moulding tools are producing the flow plates and providing feedback for the design of the hardened steel tools to consolidate further mass manufacturing capacity. The initial results have verified our designs and we expect the definitive tool to meet our cost and production time objectives.

We have been working with a leading ultra-sonic welding solutions provider to reduce the time taken to incorporate our electrodes into the flow plates from minutes to seconds and improving produ

AFC Energy (AIM: AFC), a leading provider of hydrogen power generation technologies, is pleased to announce its results for the year ended 31 October 2019.

Highlights:

· Investment of £ 0.35 million in EV charger demonstration unit to test commercial and technical feasibility of the product.

· Continued reduction in electrode running cost through support from Industrie De Nora resulting in electrode pairing demonstration achieving milestone 10,000 hours of continuous operation.

· First batch of mass manufactured flow plates received from Advanced Plastics, strengthening supply chain and reducing production costs.

· High power density alkaline fuel cell demonstration successfully achieves power density output comparable with leading existing technologies with prospect to open new commercial applications.

· Agreement signed with an international Original Engineering Manufacturer ("OEM") to assess "Ammonia to Power" off-grid platform.

· Segmented commercial strategy launched with appointment of commercial sales coverage with relevant sector experience.

· Operating losses reduced from £ 5.0 million to £ 3.6 million (after £ 0.8 million reduction in share-based payments accrual).

· Strengthened financial position by focussing on immediate opportunities completing the year with no drawdown of equity financing facility.

· Appointment of former Rolls Royce Fuel Cell Systems and LG Fuel Cell Systems Chief Technical Officer, Dr. Gerry Agnew, as Non-Executive Director.

Adam Bond, CEO of AFC Energy, commented: "The past twelve months has seen a clear and ever-growing momentum behind the role of hydrogen as a means of decarbonising the UK's current and future energy mix. With the successes and achievements delivered by AFC Energy over these same twelve months, we are well positioned to capitalise on this growth market, particularly in support of the transition away from diesel engines in both motive and stationary applications towards clean hydrogen-based alternatives.

The premium priced power achievable in both off-grid and convenience based rapid EV charging present market deployment opportunities as recently validated through feedback received following the Company's EV charger demonstration roadshow throughout the UK earlier this month.

The next twelve months will see a concerted effort focussed on the sale and deployment of fuel cell systems into these key markets alongside growth in resources to deliver scaled up manufacturing capacity and also sales and commercial coverage of our key targets. We have the opportunity for clear first mover advantage in the EV charging market in particular and through the much-appreciated efforts of our employees and partners, look forwards to delivering on our commitments to support the UK's and international efforts towards a net zero society"

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