ACTA.L Regulatory News (ACTA)

19 Sep 2007 07:01

Acta S.p.A.19 September 2007 19 September 2007 Acta S.p.A Interim Results for the six months ended 30 June 2007 Excellent commercial and technical progress Acta, the AIM-listed catalyst developer, today announces its interim results for the six months ended 30 June 2007. Results Highlights • £5.75m subscription agreement with Sumitomo Corporation and placing with institutional investors • Sumitomo Corporation has taken a 10% stake and extended the marketing agreement to ten years • Substantial increase in revenues to €212,000 (1H 06: €14,000) • Significant increase in catalyst shipments; repeat orders to all major customers • 20 new customers gained, and nine Non Disclosure Agreements signed • Cash utilisation of €1.7m well controlled and within plan • World's first direct ethanol powered fuel cell vehicle demonstrated in Shell Eco-marathon by Hochschule Offenburg • Commercial negotiations underway with major customers • Development and launch of catalyst for ammonia electrolysis • Carbon Trust grant awarded to develop catalysts which convert carbon dioxide into usable liquid fuels Prospects and Outlook: • Further rapid commercial, technical and operational progress anticipated • Customer interest expected to drive further revenue growth • Costs on target to remain within budget • Strong net cash position, expected to fund operational activities into 2010 Robert Drummond, Chairman, said today: "Acta has continued to make excellent progress, having delivered on all of our commercial, technical and operational milestones in the first half of the year. The commercialisation of our catalysts into multiple markets is proceedingwell, as evidenced by repeat orders from our major customers and continuingsharp growth in revenues. The investment in Acta by Sumitomo Corporation, ourcommercial partner in the core Asian market, provided a further clearendorsement of our significant commercial potential." "This investment, combined with the considerable customer interest in ourtechnology and the appointment of two new directors to further strengthen ourmanagement team, leaves us confident of delivering further progress with our keycommercial milestones in the second half of the year." For further information please contact: Acta S.p.A Tel. + 44 (0) 20 7360 4900Toby Woolrych Smithfield Group Tel. +44 (0) 20 7360 4900Noemie de Andia, George Hudson, Katie Hunt Numis Tel. +44 (0) 20 7260 1000David Poutney, Alex Ham About Acta Acta develops and manufactures unique patented catalysts which were launched initially to the renewable energy and portable electronics markets. Acta's HYPERMEC catalyst range for fuel cells allows developers to stop using expensive platinum so that fuel cells can be made commercially viable for massadoption in the portable electronics industry. Adoption of HYPERMEC catalystsgreatly reduces the cost of portable fuel cells and additionally allows for thefirst time the use of a wide range of safe liquid bio-fuels such as ethanol andglycerol. Acta's new catalysts for ammonia offer the automotive industry access to a practical hydrogen carrier for the first time. The catalysts extract hydrogenfrom ammonia at room temperature, allowing ammonia, one of the most widely usedchemicals in the world, to become a fuel for automotive use, solving the problem of hydrogen storage and transportation. Chairman's Statement I am delighted to report that Acta has made excellent progress in the first six months of 2007, achieving all of its milestones. Revenues were sharply up as aresult of increased sales across the product range. Excellent technicalprogress included the launch of two major new products and the filing ofassociated patents. The business continues to be well funded. Strategy Acta's strategy is to continue the commercial development of its core HYPERMEC catalysts, while developing further applications and breakthrough products infuel cell and other industrial markets, such as its new range of catalysts forhydrogen generation from ammonia. Commercial Progress Commercial negotiations are underway with a number of customers to deepen our collaboration and accelerate the development of products for their markets. Good commercial progress was made in the first six months of this year. Sales of catalysts and electrodes were sharply higher than the equivalent period lastyear. Our major target OEM customers placed repeat orders and we also addednew customers, including for our alkaline fuel cell application. The new HYPERMEC 3-Series anode has generated good feedback from customers. Industryinterest in Alkaline Membrane Fuel Cell (AMFC) technology is increasing: manyof the leading global technical institutes now have development programmes and agrowing number of major OEMs consider that this technology may be the mostcommercially viable. A significant proportion of Acta's revenue in the period came from sales of the ammonia electrolyser catalyst which was launched early this year. We have beengreatly encouraged by the strong interest in this product from a range ofindustry sectors, both for fuel cells and for other applications. After a period of agreed exclusivity for our first customer, we now expect to market theammonia electrolyser to a broader range of interested parties from the secondhalf of 2007. In July, Acta renewed its marketing agreement with Sumitomo Corporation, our Asian partner. This agreement has been strengthened and extended to a minimumten year initial fixed term. This commitment to a long term relationship bySumitomo, along with their intended investment in a 10% shareholding in Acta, is a superb endorsement both of our commercial progress and our potential. Promising commercial leads have also been developed for HYPERMEC in other non fuel-cell markets, including battery technology where some encouraging trialsare underway. Technical Progress Acta's exciting catalyst and component technology is at the heart of our commercial success. The first six months saw the launch of two major newproducts as well as solid progress in all other areas of our business. The ammonia electrolyser catalysts have demonstrated good performance and stability with low platinum loadings. Development and characterisation of thecatalyst and electrolyser systems will continue as we seek to maintainleadership in this exciting new area. The HYPERMEC 3-Series anode offers peak power up to 70% higher than the original anode, with enhanced stability and reproducibility. Used with theexisting cathode, HYPERMEC offers state of the art performance in the alkalineenvironment. Tests have demonstrated good stability over 3,000 hours at room temperature. The development programme is expected to offer continuingperformance improvements. Intellectual Property Development Acta filed four new patent applications in the first half of the year and a further four after the period end, including two applications for Europeanpatent extensions (PCT). Acta now has one PCT granted and a further nine PCTapplications, including seven extensions of Italian patent applications, in progress. The company's intellectual property portfolio now contains patentapplications covering sixteen separate intellectual property claims. Operational Progress Acta created a full time production team in January to meet customer demand and to generate the production processes and capacity to take the company toprofitability. The team made excellent progress in meeting its productiontargets in the first half. The June targets of 1kg of cathode per week, 0.5kgof anode per week and 250 electrodes per week have been met. Scale up of therecently installed rotary kiln will allow achievement of the December targetson schedule. The capacity to be commissioned by year end would allow thebusiness to meet orders of up to €4.5m at an annualised rate and at currentmarket prices. Financial Performance Revenues from the sale of product samples increased sharply to €212,000 during the six months to 30 June 2007, compared to €14,000 in the same period last yearand €70,000 for the whole of 2006. These revenues came mainly from sales ofcatalysts and electrodes for both fuel cell and ammonia electrolyser applications. Grant income of €274,000 was also recognised against costs inrelation to the €2.1 million FIT project (development of a prototype directethanol fuel cell stack) and €0.6 million FISR project (development of inorganicand hybrid catalysts for fuel cells). Operating losses, including non-cash accruals for stock option costs, amounted to €2.5m (1H06: €2.3m). This reflects an increased investment in commercial andtechnical resources offset by a reduction in one-off expenses relating to theestablishment of the company and its new premises. The loss was comfortablywithin budget, and is expected to rise modestly during the second half of theyear as our commercial and technical activities continue to grow, whileremaining well within budget for the year as a whole. Net cash utilisation for the period, at €1.7m (1H06: €2.0m), was well below operating losses, and cash and short term investments stood at €5.3m as at 30June 2007 (1H06: €9.3m). €371,000 was received in relation to grants (loansplus income) during the period, while investments in technical equipment,patents and other capital items amounted to €218,000. Since the half year end, and therefore not reported in the six month statement, the company announced that it had raised £5.75m (approximately €8.3m) from aninvestment of £4.6m by Sumitomo Corporation and a placing of £1.15m withinstitutional investors (£5.65m net of expenses). It is expected that this fund raising, at a price of 115p per share, will provide sufficient funds forthe company to continue operating at its projected cash burn into 2010. Management The company is delighted to announce the appointment of two important new members of the management team. Dr Hubert Gasteiger has joined from GeneralMotors as Catalyst Technologies Development Director. Dr Gasteiger is one ofthe leading catalyst development figures in the industry and his appointmentreflects Acta's growing reputation and excellent market positioning. JasonDavies also joins from speciality chemicals business Rockwood Pigments (ex-Johnson Matthey) as Sales Director. Jason has 20 years' experience sellingspeciality chemicals, mainly in our core Asian market. Outlook and milestones The outlook for the second half is encouraging. Continuing sample sales are expected in the second half. Commercial discussions are also progressing with anumber of high quality customers with a view to entering into more extensivecollaborations at the start of 2008, which is in line with the target when we announced preliminary results in March 2007. Acta's role as a leader in thealkaline membrane fuel cell sector and in ammonia electrolysis is alsoresulting in a number of important technical collaborations with supply chain participants, particularly in Asia. Growing operational capacity and anexciting technical development programme highlight Acta's progress as amaturing supplier of key components to a number of exciting high growth marketsectors. Robert DrummondNon Executive Chairman Consolidated income statement Six months Six months Year ended ended ended Notes 30 June 30 June 2006 31 December 2007 2006 Unaudited Unaudited Audited •'000 •'000 •'000 Revenue 212 14 70 Other operating revenue 0 1 2 --------- --------- ----------- 212 15 72 Raw materials and consumables used (123) (46) (142) Personnel expense (1,658) (1,415) (3,088) Depreciation and amortisation expense (165) (112) (269) Other operating expenses (768) (773) (1,625) --------- --------- -----------Loss from operations (2,502) (2,331) (5,052) Financial income 69 132 242 Financial expenses (17) (4) (18) --------- --------- -----------Loss before tax (2,450) (2,203) (4,828) Current tax expense 0 2 0 --------- --------- ----------- Loss for the period (2,450) (2,201) (4,828) --------- --------- -----------Attributable to: Equity holders of the parent (2,425) (2,195) (4,779) Minority interest (25) (6) (49) --------- --------- ----------- (2,450) (2,201) (4,828) --------- --------- ----------- Basic earnings per share (euro cents) 3 (6.74) (6.00) (12.78) Diluted earnings per share (euro cents) 3 (6.58) (6.02) (12.63) Consolidated balance sheet Six months Six months Year ended ended ended Notes 30/06/2007 30/06/2006 31/12/2006 Unaudited Unaudited AuditedASSETS •'000 •'000 •'000 Non-current assets Property, plant and equipment 1,769 1,010 1,754 Goodwill 11 11 11 Intangible assets 897 825 858 --------- --------- -----------Total non-current assets 2,677 1,846 2,623 --------- --------- ----------- Current assets Inventories 69 36 74 Trade receivables 46 8 55 Non-trade receivables 834 664 737 Cash and cash equivalents 5,311 9,289 7,049 --------- --------- -----------Total current assets 6,260 9,998 7,915 --------- --------- -----------Total assets 8,937 11,843 10,538 --------- --------- ----------- EQUITY AND LIABILITIES Equity attributable to equity holders of the parent Share capital 216 216 216 Capital reserves 17,093 16,224 16,686 Retained losses (10,782) (5,720) (8,358) --------- --------- ----------- 6,527 10,720 8,544 Minority interest 175 95 52 --------- --------- -----------Total equity 6,702 10,815 8,596 Non-current liabilities Employee benefits 53 23 32 Long-term provisions 89 89 89 Long-term borrowings 862 80 596 --------- --------- -----------Total non-current liabilities 1,004 192 717 --------- --------- ----------- Current liabilities Other financial liabilities 57 57 57 Short-term borrowings 82 22 70 Trade and other payables 1,081 744 1,098 Current tax payables 11 12 0 --------- --------- -----------Total current liabilities 1,231 836 1,225 --------- --------- ----------- --------- --------- ----------- Total liabilities 2,235 1,028 1,942 --------- --------- ----------- --------- --------- ----------- Total equity and liabilities 8,937 11,843 10,538 --------- --------- ----------- Consolidated statement of changes in equity Six months ended Six months ended Year ended 30 June 2007 30 June 2006 31 December 2006 Unaudited Unaudited Audited •'000 •'000 •'000 Opening shareholders' equity 8,596 12,646 12,646 Loss for financial period (2,425) (2,195) (4,779) Minority interest in loss (25) (6) (49) Minority contribution 149 0 0 Share based payment 407 370 778 --------- --------- ----------- Closing shareholders' equity 6,702 10,815 8,596 ========= ========= =========== Consolidated cash flow statement Six months Six months Year ended ended ended 30/06/2007 30/06/2006 31/12/2006 Unaudited Unaudited Audited •'000 •'000 •'000 Cash flows from operating activities Loss from operations (2,450) (2,201) (4,828) Adjustments for: Depreciation, amortisation 165 112 269 Movement in provision for employees' benefits (TFR) 19 13 22 Bonus accrual (94) 174 389 Income taxes (3) (1) 0 Stock option expenses 407 371 778 --------- --------- -----------Cash outflow before changes in working capital and provisions (1,956) (1,532) (3,370) --------- --------- -----------Decrease/(increase) in trade and other receivables 62 28 (92) Decrease/(increase) in inventories 5 (22) (60) (Decrease) in trade and other payables 91 (265) (91) (Decrease) / increase in deferred government grants 0 0 (47) --------- --------- -----------Cash outflow from operations (1,798) (1,791) (3,660) --------- --------- ----------- Cash flows from investing activities Acquisition of property, plant and equipment net of finance leases (118) (183) (1,028) Acquisition of intangible assets (100) (12) (102) --------- --------- -----------Net cash used in investing activities (218) (195) (1,130) --------- --------- -----------Cash flows from financing activities Proceeds from new loan 291 0 565 Payment of lease finance (13) (8) (10) Net cash inflows from financing activities 278 (8) 555 Net (decrease) in cash and cash equivalents (1,738) (1,994) (4,235) Cash and cash equivalents at 1 January 7,049 11,284 11,284 Effect of exchange rate fluctuations on cash held 0 (1) (0) --------- --------- -----------Cash and cash equivalents at end of period 5,311 9,289 7,049 --------- --------- ----------- Notes to the interim financial statements for the six months ended 30 June 2007 1. Basis of preparationThe financial statements have been prepared using accounting policies consistentwith International Financial Reporting Standards and in accordance withInternational Accounting Standard (IAS) 34 Interim Financial Reporting. 2. Principal accounting policiesThe financial statements have been prepared under the historical cost convention. The same accounting policies, presentation and methods ofcomputation are followed in these financial statements as were applied in thepreparation of the Group's financial statements for the year ended 31 December2006. 3. Loss per shareThe calculation is based on information in the table shown below: Six months Six months Year ended ended 30 ended 30 31 December June 2007 June 2006 2006 (unaudited) (unaudited) (audited) •'000 •'000 •'000 Loss (2,450) (2,201) (4,828) --------- --------- ----------- Weighted average number of shares 35,995,126 33,768,035 35,995,126 --------- --------- ----------- Diluted weighted average number of ordinary shares 36,829,498 34,754,080 36,954,473 --------- --------- ----------- 4. Statement of changes in equity Share Capital Retained Minority capital Reserve earnings Interest Total •'000 •'000 •'000 •'000 •'000 Balance at 1 January 2006 216 15,854 (3,524) 100 12,646 Share based payment 371 371 Loss for the period (2,195) (6) (2,201) -------- -------- -------- -------- --------Balance at 30 June 2006 216 16,225 (5,719) 94 10,816 -------- -------- -------- -------- --------Balance at 1 January 2007 216 16,686 (8,358) 52 8,596 Share based payment 407 407 Minority contribution 148 148 Loss for the period (2,424) (25) (2,449) -------- -------- -------- -------- --------Balance at 30 June 2007 216 17,093 (10,782) 175 6,702 -------- -------- -------- -------- -------- 5. Board The financial information for the period 1 January 2007 to 30 June 2007 is unaudited although it has been reviewed by the Company's audit committee. In the opinion of the Directors the financial information for this period presents fairlythe position, results of operations and cash flows for the period. The interim report for the six months ended 30 June 2007 was approved by the Directors on 18 September 2007. This information is provided by RNS The company news service from the London Stock Exchange