28 Aug 2008 07:00
28 August 2008
CERAMIC FUEL CELLS LIMITED
("CFCL" or "the Company")
PRELIMINARY RESULTS FOR THE 12 MONTHS ENDED 30 JUNE 2008
Ceramic Fuel Cells Limited (AIM / ASX: CFU), a leading developer of high efficiency and low emission microgeneration products for homes, today announces its preliminary results for the year ended 30 June 2008.
Highlights in the period and year to date
Customers and Products
In July 2007, signed product development agreements with major energy company customers and appliance partners, E.ON UK and Gledhill Water Storage Ltd for the United Kingdom market, and Nuon and Remeha / De Dietrich Thermique for the Benelux markets
In January 2008, entered the Japanese market through a product evaluation and development agreement with the Paloma Group
In February 2008, announced first volume order for 50,000 mCHP units from Nuon, based on meeting agreed performance and price targets
By June 2008, installed six NetGenPlusTM units with European customers and partners
Manufacturing and Supply Chain
Built and commissioned a £3.1 million plant in Merseyside, UK, to make high quality ceramic powders using the Company's proprietary technology
Confirmed investment of €12.4 million for a large scale fuel cell plant in Heinsberg, Germany.
Secured long term supply agreements for fuel cell components with two leading German advanced ceramics suppliers, HC Starck and CeramTec
Entered commercial relationships with suppliers of mCHP balance of plant components, achieving significant cost savings and size reductions
Technology
Obtained European 'CE' safety approval for the NetGenPlusTM unit
Strong progress in cell power density, efficiency and fuel cell stack lifetime
Extensive intellectual property portfolio supplemented with further patents granted
Financial
Sales revenue from customers up 42% to A$617k / £288k (2007: A$435k / £203k)
Operational cash outflow increased by A$834k / £389k to A$19.8 million / £9.3 million to fund expanded product development, supply chain and manufacturing scale up
Net loss increased by A$4 million / £1.8 million to A$23.7 million / £11.1 million, largely due to a non-cash impairment charge and staff option expenses
Raised A$14.7 million / £7 million in a placement of new shares in May 2008
Total cash and investments at 30 June 2008 of A$43.3 million / £20.3 million (30 June 2007: A$60.2 million / £28.2 million)
Brendan Dow, Managing Director of Ceramic Fuel Cells, said:
"This has been another year of considerable progress for CFCL. We have continued to make progress in developing products with our partners and, significantly, have received our first volume order with agreed targets from Nuon. Our progress in increasing our manufacturing capacity and enhancing our supply chain gives us confidence that we can transition from product development to commercialistion from the second half of 2009."
ENDS
Managing Director Mr Brendan Dow discusses the preliminary results in a webcast interview on Boardroomradio - click here or go to www.brr.com.au/cfu.
For further information please contact:
| Ceramic Fuel Cells | |
| Andrew Neilson | Tel: +61 419 950 771 |
| Email: investor@cfcl.com.au | |
| Nomura Code Securities | Tel: +44 (0) 207 776 1200 |
| Juliet Thompson / Chris Golden | |
| Hogarth Partnership (PR for CFCL) Sarah MacLeod / Sarah Richardson / Vicky Watkins | Tel: +44 (0) 20 7357 9477 |
Ceramic Fuel Cells Limited is a world leader in developing solid oxide fuel cell (SOFC) technology to provide highly efficient and low-emission electricity from widely available natural gas and renewable fuels. CFCL is developing SOFC products for micro combined heat and power (mCHP) and distributed generation units that generate electricity and heat for homes.
CFCL is developing mCHP products with leading appliance partners and utility customers in Germany (EWE and Bruns Heiztechnik), France (Gaz de France and De Dietrich Thermique), the United Kingdom (E.On UK Ltd and Gledhill Water Storage Ltd), Holland (Nuon and Remeha), and Japan (Paloma). CFCL is listed on the London Stock Exchange AIM market and the Australian Securities Exchange (code CFU). www.cfcl.com.au
Operational Review
Introduction
CFCL is continuing to deliver on a clear and focused strategy, by developing mCHP products with leading energy customers and appliance partners in five large markets.
Significantly, CFCL's first volume order was secured during the year with partner Nuon, based on meeting agreed targets. During the financial year the Company opened a new plant in Bromborough to produce high quality ceramic powders, and entered into partnerships to outsource volume component manufacturing, to increase capacity and reduce unit costs. The Company also confirmed a €12.4 million investment in a new plant in Heinsberg, Germany. The Company has continued to develop its technology, with further advances in fuel cell power density, efficiency and lifetime.
The Company raised £7 million in a placement of new shares in May 2008, with a good response from existing and new investors. The Company is now designing and developing fully integrated mCHP units with its European appliance partners. The Company expects to complete its first fully integrated products by the end of 2008 and is on track to produce units from its Heinsberg plant from the second half of 2009.
Customers and Products
The first product to be powered by CFCL fuel cells will be combined heat and power (mCHP) units for homes. The product will replace a standard home heating system, using the existing natural gas network to provide high efficiency and low emission power and heat, as well as exporting excess power to the electricity network.
The Company is developing mCHP products with leading utility customers and appliance partners in five key markets: Germany, France, the United Kingdom, the Benelux markets and Japan.
In February 2008 the Company announced that leading Dutch energy supplier Nuon had agreed to place an order for 50,000 mCHP units, on the achievement of agreed performance targets. These targets encompass physical weight and size, power and heat output, efficiency, lifetime, CO2 savings and selling price of the mCHP unit. The Company has made strong progress toward meeting key technical targets and in July 2008 announced further advances in fuel cell stack efficiency and lifetime. This agreement with Nuon is a milestone achievement for the Company, with the potential to deliver significant revenue over many years.
During the financial year the Company continued to make progress with its product development projects.
In late 2007 the Company obtained European 'CE' approval for its NetGenPlusTM units, and then shipped units to the Company's appliance partners in Germany and the UK. By the end of the financial year a total of six NetGenPlus units were installed with the Company's European partners, as follows:
Two units installed at EWE's facilities and one unit with Bruns Heiztechnik in Germany.
Two units installed with De Dietrich Thermique in France (one each for the projects with Gaz de France and Nuon).
One unit installed with Gledhill Water Storage Ltd in the UK.
These NetGenPlus units are connected to existing heating units and tested and operated in real world conditions, using existing natural gas, water and telecommunications connections and the local electricity grids. These programs allow the Company and its partners to monitor the performance of the units in order to optimise the design of the fully integrated unit and commercial products.
In January 2008, the Company entered the Japanese market through a product evaluation and development agreement with Paloma Industries Ltd.
Japan is one of the world's leading and fastest growing markets for fuel cells, with over 2,000 residential low-temperature fuel cell systems installed, more than any other country in the world. The Japanese Government has a long term funding and strategic program to support the commercialization of residential solid oxide fuel cell (SOFC) CHP units. Japan is also a large market for home heating appliances, with approximately 4.2 million units sold per year into a market of 47 million households.
The Paloma Group is a leading global producer of gas appliances for residential and commercial applications, and owns the Rheem, Raypak and Solahart brands. The Group has annual revenues of approximately US$2.5 billion and serves more than 10 million homes in Japan.
Under the agreement, CFCL will supply Paloma with a NetGenPlus™ unit for Paloma to operate at its site in Japan. The unit is ready to be shipped to Paloma within the next week. Using the results of the real-world product operation, which is expected to run for up to 12 months, CFCL and Paloma will design and develop integrated mCHP products for the Japanese market.
The Company also continues to assess a range of opportunities to enter new markets and develop additional products.
Manufacturing and Supply Chain
In February 2008 and in line with CFCL's strategy, the Company announced that it is investing €12.4 million in the construction of a manufacturing plant in Heinsberg, Germany for the commercial production of its fuel cell systems. The plant will have an initial capacity of 10,000 units per year.
By June 2008 the Company had received full environmental and building permit approvals for the plant from the appropriate German government bodies. The Company had also signed contracts and placed orders for the three largest cost pieces of equipment, comprising furnaces, ink skids and robotic assembly units.
The project is on budget and on schedule for the plant to be operational by June 2009.
During the financial year the Company also developed partnerships with leading global suppliers to establish the supply chain for the Heinsberg plant.
Early in 2008 the Company signed long term fuel cell supply and co-operation agreements with each of H.C. Starck and CeramTec, leading German-based manufacturers of advanced ceramic components. Under each of these agreements, the companies will share relevant intellectual property and technical expertise to continually improve the performance of the supplier's cells, improve manufacturing processes and reduce unit costs. Each supplier has agreed to supply the Company with fuel cell components at fixed prices through to December 2011. The Company will continue to produce fuel cells at its Melbourne R&D and pilot manufacturing facility to drive continued improvements in cell and stack performance.
The Company also entered commercial relationships with suppliers of the 'balance of plant' components, which are integrated with the fuel cell stack to create CFCL's fuel cell module. The Company has developed and sourced compact and highly efficient components from low cost commercial suppliers, with significant cost savings and size reductions.
UK Powder Plant
In late 2007 the Company finished building and commissioning a plant in Bromborough, Merseyside, UK, designed to make high quality ceramic powders using the Company's proprietary technology. Since then the Company has been optimising the processes and equipment used at the plant to make zirconia powders. Zirconia is a key input into the Company's fuel cell components and is also used in a wide range of other products and applications.
In early 2008 the first shipment of zirconia powder from the Bromborough plant was received in Noble Park, Victoria. The powder passed all the Company's quality control and powder characterisation tests and has been used to make the Company's fuel cells.
CFCL has also continued to develop powder samples for several potential customers.
The Company believes that the plant is capable of making a range of high quality powders for several large and growing markets, and that the plant and the associated intellectual property can provide a range of options to maximise shareholder value.
Technology
During the year the Company continued to improve the performance of its fuel cell technology to meet commercial targets. In early July the Company presented its latest technical advances at the 8th annual European Solid Oxide Fuel Cell Forum, including:
a 50% increase in cell power density from June 2007 to June 2008;
an increase in fuel cell stack lifetime. Degradation has reduced by 35%, from 1.53% / 1000 hours reported in February 2008 to less than 1% / 1000 hours, when operating a 1kW stack in a test station at 750oC on natural gas.
These results have been achieved through advances made in cells, glass technology, interconnect metals, protective coatings on metals and contact technology.
In July 2008 the Company was granted a further patent in Europe, for a way of reforming fuels for a fuel cell system. The patent is for an advanced fuel cell pre-reforming system. This system allows CFCL to control the proportion of methane and remove all higher hydrocarbons from the fuel used for the fuel cell. This invention allows CFCL to use a wide variety of fuels for its fuel cells, including liquid hydrocarbon fuels and bio-fuels, and also maintain a very high system efficiency. The invention is also patented in Australia and China, and applications are in progress in the USA and Japan.
Financial Review
The summary financial results for the year from 1 July 2007 to 30 June 2008 are as follows:
(All currency figures are shown in thousands)
| Financial Highlights |
|
|
|
|
|
|
| 12 months to: |
| |||
|
| 30-June-2008 | 30-June-2007 | Change | ||
| Income (Expense) | A$000 | £000 | A$000 | £000 |
|
| Sales Revenue | 617 | 288 | 435 | 203 | 41.9% |
| EBIT - profit (loss) | (26,807) | (12,545) | (23,669) | (11,077) | 13.3% |
| Interest & Other Income | 3,128 | 1,463 | 3,991 | 1,867 | -21.6% |
| Net Profit (Loss) - after tax | (23,679) | (11,081) | (19,678) | (9,209) | 20.3% |
| Cash Outflow from: |
|
|
|
|
|
| - Operations | (19,845) | (9,287) | (19,011) | (8,897) | 4.4% |
| - Capital Expenditure | (6,855) | (3,208) | (7,501) | (3,510) | -8.6% |
Revenue
The Group's business revenues increased during the period by 41.9%, to A$617K (£288K) (2007: A$435k / £203k) as the Group supplied its NetGenPlus units to its European utility and appliance partners.
Interest and other income was A$3,128K (£1,463K) this year compared to A$3,991K (£1,868K) last year. The Group received A$1,174K (£549K) less in interest income for the year, as the Company liquidated some investments over the year.
Expenses
The Group spent A$12,310K (£5,761K) on Research and Product Development (R&PD) activities, which was broadly in line with the prior year (2007: A$12,050K / £5,639K).
These activities focused on optimising the fuel cell stack and systems, building and deploying NetGenPlus systems to utility and appliance partners, and then integrating those units with the appliance partners' heating units. During the year 12 NetGen Plus systems were built for deployment to partners and internal testing and development. In accordance with accounting standards the costs of these prototype units are expensed as incurred. The Company receives revenue from its partners for building and deploying these units. This revenue is recognised progressively as contractual milestones are met.
The Group employed 72.4 full time equivalent staff in R&PD and production activities, which was slightly lower than last year.
Sales and Marketing costs increased 5.4%, to A$2,150K (£1,006K). Most of these costs relate to business development and commercialisation activities, focused in Europe.
The Group's expenditure on General and Administrative costs rose from A$10,015K (£4,687K) last year to A$12,964K (£6,067K) this year. The main reasons for the increase were:
The fuel cell plant in Germany and the UK powder plant only operated for part of the prior year, and activity at both plants increased this year. The increased costs in the current year amounted to A$979K (£458K);
The charge for the expensing of employee share options increased by A$1,400K (£655K) in the current year, to A$1,812K (£848K); and
One of the Group's investments suffered a downgrading in its Standard & Poor's credit rating to below investment grade. Although the investment is still currently meeting its obligations on interest payments, an impairment charge of A$3,267K (£1,528K) was taken up - which represents near the full value of the investment. (All other investments remain at their original credit ratings of A or above).
Net Loss After Tax
The net loss for the year was A$23,679K (£11,081K), an increase of A$4,001K (£1,872K) over the past year.
The main reasons for the increased loss are outlined above and can be summarised as:
| £ equivalent | ||
| Reduction in interest income | A$1,174K | (£549K) |
| Increase in reported P&L expenses | A$3,320K | (£1,553K) |
The net loss represents a loss of 7.52 cents per share (3.5 pence) compared to 6.36 cents (2.9 pence) last year.
Cashflow and Balance Sheet
The Group's cash outflow from operations increased by $834K to A$19,845K (£9,287K), to fund the expanded product development and manufacturing activities.
Cash outflow from investing activities was A$6,883K (£3,221K) which was A$609K (£285K) lower than last year. The reduction is mainly due to the completion of the UK powder plant and the timing of project payments for the fuel cell plant in Germany, which began in February 2008.
The project to build and commission the UK powder plant took just over a year, and was completed in October 2007 for a total cost of A$6,507K (£3,045K).
The construction of the fuel cell plant in Germany is progressing in line with the budgeted timeline and costs. At 30 June 2008 the value of the plant in the balance sheet was A$2,278 (£1,066K).
Cash inflow from financing activities was A$36,008K (£16,851K), which was A$16,696K (£7,813K) higher than last year. This was largely due to a share placement in May 2008, which raised A$13,923K (£6,515K) net of costs by the issue of 35 million shares.
At 30 June 2008 the Group had cash and investments of A$43,300K (£20,264K).
Outlook 2008- 09
Over the 2008-09 financial year the Company will continue to develop products with its utility customers and appliance partners. The Company will operate semi-integrated units at its partners' facilities, and will progress into building fully integrated units for deployment with European customers.
The Company will also build up its manufacturing capacity, through partnerships with suppliers for fuel cells and commercial balance of plant components, and through the Company's fuel cell assembly plant in Germany, which is on schedule to be operational in June 2009. The Company will also make high quality zirconia powder at its UK plant, for internal use and for other customers, as well as identifying further opportunities to commercialise the Company's intellectual property.
Finally the Company will continue its technical advances in efficiency and durability which are the key technical targets required for commercial fuel cell products.
ENDS
Preliminary Income Statements
For the year ended 30 June 2008
| Consolidated | Parent | |||||||
| Note | 2008 | 2007 | 2008 | 2007 | ||||
| $ | $ | $ | $ | |||||
| Revenue from continuing operations | 2 | 617,313 | 435,112 | 132,934 | 78,503 | |||
| Other income | 3 | 3,127,863 | 3,991,243 | 3,801,931 | 3,989,131 | |||
| Research & Product Development | (12,310,064) | (12,050,080) | (12,310,064) | (12,050,080) | ||||
| General & Administration | 4 | (12,964,389) | (10,014,505) | (11,466,924) | (9,615,666) | |||
| Sales & Marketing | (2,149,655) | (2,039,953) | (2,345,013) | (2,744,407) | ||||
| Profit/(loss) before income tax | (23,678,932) | (19,678,183) | (22,187,136) | (20,342,519) | ||||
| Income tax expense | - | - | - | - | ||||
| Profit/(loss) for the year attributable to members of Ceramic Fuel Cells Limited | 7 | (23,678,932) | (19,678,183) | (22,187,136) | (20,342,519) | |||
| Cents | Cents | |||||||
| Earnings per share for profit/(loss) attributable to the ordinary equity holders of the company | ||||||||
| Basic and diluted earnings per share | 8 | (7.52) | (6.36) | |||||
The above preliminary income statements should be read in conjunction with the accompanying notes.
Preliminary Balance Sheets
As at 30 June 2008
| Consolidated | Parent | |||||||
| Note | 2008 | 2007 | 2008 | 2007 | ||||
| $ | $ | $ | $ | |||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | 12,650,750 | 3,484,004 | 12,500,477 | 3,331,210 | ||||
| Trade and other receivables | 712,188 | 379,070 | 91,795 | 269,859 | ||||
| Financial assets | 5 | - | 8,641,403 | - | 8,641,403 | |||
| Other | 417,932 | 378,799 | 363,831 | 333,521 | ||||
| Total Current Assets | 13,780,870 | 12,883,276 | 12,956,103 | 12,575,993 | ||||
| Non-Current Assets | ||||||||
| Financial assets | 5 | 30,649,431 | 48,067,849 | 30,649,431 | 48,067,849 | |||
| Other financial assets | - | - | 10,074,503 | 4,677,378 | ||||
| Plant and equipment | 14,161,748 | 9,324,207 | 5,189,152 | 4,669,368 | ||||
| Intangibles | 1,000 | 1,000 | 1,000 | 1,000 | ||||
| Total Non-Current Assets | 44,812,179 | 57,393,056 | 45,914,086 | 57,415,595 | ||||
| Total Assets | 58,593,049 | 70,276,332 | 58,870,189 | 69,991,588 | ||||
| LIABILITIES | ||||||||
| Current Liabilities | ||||||||
| Trade and other payables | 1,588,346 | 2,566,972 | 1,211,834 | 2,248,948 | ||||
| Provisions | 916,220 | 771,270 | 916,220 | 771,270 | ||||
| Deferred revenue | 717,409 | 370,879 | 57,293 | 103,339 | ||||
| Total Current Liabilities | 3,221,975 | 3,709,121 | 2,185,347 | 3,123,557 | ||||
| Non-Current Liabilities | ||||||||
| Provisions | 418,624 | 224,195 | 92,136 | 95,617 | ||||
| Total Non-Current Liabilities | 418,624 | 224,195 | 92,136 | 95,617 | ||||
| Total Liabilities | 3,640,599 | 3,933,316 | 2,277,483 | 3,219,174 | ||||
| Net Assets | 54,952,450 | 66,343,016 | 56,592,706 | 66,772,414 | ||||
| EQUITY | ||||||||
| Contributed equity | 6 | 199,583,570 | 185,660,994 | 199,583,570 | 185,660,994 | |||
| Reserves | 7 | (1,378,867) | 255,343 | (1,638,844) | 276,304 | |||
| Retained profits/(losses) | 7 | (143,252,253) | (119,573,321) | (141,352,020) | (119,164,884) | |||
| Total Equity | 54,952,450 | 66,343,016 | 56,592,706 | 66,772,414 | ||||
The above preliminary balance sheets should be read in conjunction with the accompanying notes.
Preliminary Statements of Changes in Equity
For the year ended 30 June 2008
| Consolidated | Parent | |||||||
| Note | 2008 | 2007 | 2008 | 2007 | ||||
| $ | $ | $ | $ | |||||
| Total equity at the beginning of the year | 66,343,016 | 85,753,951 | 66,772,414 | 86,840,543 | ||||
| Changes in the fair value of financial assets | 7 | (3,727,022) | (248,802) | (3,727,022) | (248,802) | |||
| Exchange differences on translation of foreign operations | 7 | 280,938 | (7,143) | - | - | |||
| Net income/(expense) recognized in equity | (3,446,084) | (255,945) | (3,727,022) | (248,802) | ||||
| Profit/(loss) for the year | (23,678,932) | (19,678,183) | (22,187,136) | (20,342,519) | ||||
| Total recognized income/(expense) for the year | (27,125,016) | (19,934,128) | (25,914,158) | (20,591,321) | ||||
| Transactions with equity holders in their capacity as equity holders: | ||||||||
| Contributions of equity (net of transaction costs) | 6 | 13,922,576 | 111,101 | 13,922,576 | 111,101 | |||
| Employee share options | 7 | 1,811,874 | 412,092 | 1,811,874 | 412,092 | |||
| 15,734,450 | 523,193 | 15,734,450 | 523,193 | |||||
| Total equity at the end of the year | 54,952,450 | 66,343,016 | 56,592,706 | 66,772,414 | ||||
| Total recognized income/(expense) for the year is entirely attributable to members of Ceramic Fuel Cells Limited. | ||||||||
The above preliminary statements of changes in equity should be read in conjunction with the accompanying notes.
Preliminary Cash Flow Statements
For the year ended 30 June 2008
| Consolidated | Parent | ||||||
| 2008 | 2007 | 2008 | 2007 | ||||
| $ | $ | $ | $ | ||||
| Cash Flows from Operating Activities | |||||||
| Receipts from customers (inclusive of goods & services tax) | 1,962,253 | 1,159,875 | 1,053,633 | 921,874 | |||
| Payments to suppliers and employees (inclusive of goods & services tax) | (21,914,921) | (20,176,309) | (19,471,578) | (18,759,746) | |||
| (19,952,668) | (19,016,434) | (18,417,945) | (17,837,872) | ||||
| Grant revenue | 81,477 | - | 81,477 | - | |||
| Other revenue | 26,265 | 5,392 | 26,265 | 5,392 | |||
| Net cash inflow (outflow) from operating activities | (19,844,926) | (19,011,042) | (18,310,203) | (17,832,480) | |||
| Cash Flows from Investing Activities | |||||||
| Decrease/(increase) in security deposits | (28,078) | 9,166 | (31,207) | (2,256) | |||
| Loans to subsidiaries | - | - | (5,956,969) | (5,948,390) | |||
| Proceeds from sale of plant and equipment | - | 227 | - | 227 | |||
| Payments for plant and equipment | (6,854,552) | (7,501,417) | (2,424,644) | (2,856,451) | |||
| Net cash inflow (outflow) from investing activities | (6,882,630) | (7,492,024) | (8,412,830) | (8,806,870) | |||
| Cash Flows from Financing Activities | |||||||
| Net proceeds from/(payments for) financial assets | 19,282,116 | 15,666,047 | 19,282,116 | 15,666,047 | |||
| Proceeds from issue of shares | 14,702,361 | - | 14,702,361 | - | |||
| Share issue costs | (779,785) | (30,566) | (779,785) | (30,566) | |||
| Interest received | 2,803,263 | 3,676,413 | 2,801,251 | 3,674,301 | |||
| Net cash inflow from financing activities | 36,007,955 | 19,311,894 | 36,005,943 | 19,309,782 | |||
| Net increase (decrease) in cash and cash equivalents | 9,280,399 | (7,191,172) | 9,282,920 | (7,329,568) | |||
| Cash and cash equivalents at the beginning of the financial year | 3,484,004 | 11,184,443 | 3,331,210 | 11,170,045 | |||
| Effects of exchange rate changes on cash and cash equivalents | (113,653) | (509,267) | (113,653) | (509,267) | |||
| Cash and cash equivalents at the end of the year | 12,650,750 | 3,484,004 | 12,500,477 | 3,331,210 | |||
The above preliminary cash flow statements should be read in conjunction with the accompanying notes.
Notes to the Preliminary Financial Statements
Year ended 30 June 2008
Note 1. Summary of Significant Accounting Policies
There have been no material changes in the company's application of its significant accounting policies as presented in the company's consolidated financial statements for the year ended 30 June 2007. Readers of this report should refer to Note 1, Summary of Significant Accounting Policies, in the aforementioned financial statements for details of these accounting policies.
| Consolidated | Parent | ||||||
| 2008 | 2007 | 2008 | 2007 | ||||
| $ | $ | $ | $ | ||||
| Note 2. Revenue | |||||||
| From continuing operations | |||||||
| Sales revenue | |||||||
| Field trial income | 584,379 | 402,535 | 100,000 | 45,926 | |||
| Licensing income | 32,934 | 32,577 | 32,934 | 32,577 | |||
| Total revenue from continuing operations | 617,313 | 435,112 | 132,934 | 78,503 | |||
| Note 3. Other Income | |||||||
| Interest | 2,811,984 | 3,985,851 | 2,809,972 | 3,983,739 | |||
| Net foreign exchange gain (loss in 2007 - refer Note 4) | 189,208 | - | 180,933 | - | |||
| Export Market Development Grant (see below) | 81,477 | - | 81,477 | - | |||
| Sundry income | 45,194 | 5,392 | 729,549 | 5,392 | |||
| Total other income | 3,127,863 | 3,991,243 | 3,801,931 | 3,989,131 | |||
| Export Market Development Grant | |||||||
| There are no unfulfilled conditions or other contingencies attaching to these grants. The Group did not benefit from any other forms of government assistance. | |||||||
| Note 4. General & Administration Expenses | |||||||
| General & Administration expenses includes the following specific expenses: | |||||||
| Impairment charges | |||||||
| On financial assets | 3,267,032 | - | 3,267,032 | - | |||
| On investment in related entity | - | - | 1,339,604 | 1,775,487 | |||
| 3,267,032 | - | 4,606,636 | 1,775,487 | ||||
| Share options expense | 1,811,874 | 412,092 | 1,569,149 | 412,092 | |||
| Net foreign exchange loss (gain in 2008 - refer Note 3) | - | 2,901,032 | - | 2,901,032 | |||
Notes to the Preliminary Financial Statements
Year ended 30 June 2008
(continued)
| Consolidated | Parent | |||||||
| 2008 | 2007 | 2008 | 2007 | |||||
| $ | $ | $ | $ | |||||
| Note 5. Financial Assets - Investments | ||||||||
| Current assets | ||||||||
| Financial assets | - | 8,641,403 | - | 8,641,403 | ||||
| Non-current assets | ||||||||
| Financial assets | 30,649,431 | 48,067,849 | 30,649,431 | 48,067,849 | ||||
| 30,649,431 | 56,709,252 | 30,649,431 | 56,709,252 | |||||
| Investments include the following revaluation surplus/(deficit) (transferred to equity) as at reporting date: | (3,898,009) | (170,987) | (3,898,009) | (170,987) | ||||
| Unlisted securities | ||||||||
| Interest-bearing securities denominated in: | ||||||||
| Australian dollars | 4,850,925 | 12,050,768 | 4,850,925 | 12,050,768 | ||||
| European euros | 20,911,477 | 28,498,086 | 20,911,477 | 28,498,086 | ||||
| UK pounds sterling | 4,887,029 | 16,160,398 | 4,887,029 | 16,160,398 | ||||
| 30,649,431 | 56,709,252 | 30,649,431 | 56,709,252 | |||||
| Reconciliation | ||||||||
| Opening balance at 1 July 2007 | 56,709,252 | |||||||
| Disposals | (19,282,116) | |||||||
| Impairment charge | (3,267,032) | |||||||
| Decrease in investments revaluation reserve | (3,727,022) | |||||||
| Foreign exchange gain | 216,349 | |||||||
| Closing balance at 30 June 2008 | 30,649,431 | |||||||
Note 6. Contributed Equity
(a) Share capital
The share capital account of Ceramic Fuel Cells Limited (the company) consists of 344,745,674 fully paid up, ordinary shares as at 30 June 2008.
(b) Movements in ordinary share capital
Movements in ordinary share capital of the company during the past two years were as follows:
| Date | Details | Number of shares | Issue price | Amount $ |
| 1-7-2006 | Opening balance | 309,505,559 | 185,549,893 | |
| 2-3-2007 | Issued for services rendered | 236,111 | $0.60 | 141,667 |
| Less: Transaction costs arising on share issues | - | (30,566) | ||
| 30-6-2007 | Balance | 309,741,670 | 185,660,994 | |
| 23-10-2007 | Issued to employee on exercise of options | 4,000 | $0.59 | 2,360 |
| 9-5-2008 | Share placement | 35,000,004 | $0.42 | 14,700,001 |
| Less: Transaction costs arising on share issues | - | (779,785) | ||
| 30-6-2008 | Balance | 344,745,674 | 199,583,570 |
(c) Ordinary shares
Ordinary shares entitle the holder to participate in dividends, and the proceeds on winding up of the company, in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting of the company, either personally or by duly authorised representative, proxy or attorney, is entitled to one vote, and upon a poll each share is entitled to one vote.
Notes to the Preliminary Financial Statements
Year ended 30 June 2008
(continued)
| Consolidated | Parent | ||||||
| 2008 | 2007 | 2008 | 2007 | ||||
| $ | $ | $ | $ | ||||
| Note 7. Reserves and Retained Profits/(Losses) | |||||||
| (a) Reserves | |||||||
| Investments revaluation reserve | (3,898,009) | (170,987) | (3,898,009) | (170,987) | |||
| Share-based payments reserve | 2,259,165 | 447,291 | 2,259,165 | 447,291 | |||
| Foreign currency translation reserve | 259,977 | (20,961) | - | - | |||
| Total reserves | (1,378,867) | 255,343 | (1,638,844) | 276,304 | |||
| Investments revaluation reserve | |||||||
| Balance at 1 July | (170,987) | 77,815 | (170,987) | 77,815 | |||
| Revaluation - gross | (3,727,022) | (248,802) | (3,727,022) | (248,802) | |||
| Balance at 30 June | (3,898,009) | (170,987) | (3,898,009) | (170,987) | |||
| Share-based payments reserve | |||||||
| Balance at 1 July | 447,291 | 35,199 | 447,291 | 35,199 | |||
| Option expense | 1,811,874 | 412,092 | 1,569,149 | 412,092 | |||
| Share options issued to subsidiary employees | - | - | 242,725 | - | |||
| Balance at 30 June | 2,259,165 | 447,291 | 2,259,165 | 447,291 | |||
| Foreign currency translation reserve | |||||||
| Balance at 1 July | (20,961) | (13,818) | |||||
| Currency translation differences arising during the year | 280,938 | (7,143) | |||||
| Balance at 30 June | 259,977 | (20,961) | |||||
| (b) Retained profits/(losses) | |||||||
| Movements in retained profits/(losses) were as follows: | |||||||
| Balance at 1 July | (119,573,321) | (99,895,138) | (119,164,884) | (98,822,365) | |||
| Net profit/(loss) for the year | (23,678,932) | (19,678,183) | (22,187,136) | (20,342,519) | |||
| Balance at 30 June | (143,252,253) | (119,573,321) | (141,352,020) | (119,164,884) | |||
| Consolidated | |||
| 2008 | 2007 | ||
| Note 8. Earnings Per Share | |||
| Cents | Cents | ||
| Basic and diluted earnings per share | (7.52) | (6.36) | |
| Number | Number | ||
| Weighted average number of shares Weighted average number of shares used as the denominator in calculating basic and diluted earnings per share | 314,717,091 | 309,583,185 | |
| $ | $ | ||
| Earnings used in calculating basic and diluted earnings per share Profit/(loss) attributable to the ordinary equity holders of the company | (23,678,932) | (19,678,183) | |