Last checked at 30 Mar 2016 07:00
30 March 2016
CAP-XX Limited
("CAP-XX" or the "Company")
Interim Results for the half-year ended 31 December 2015
CAP-XX Limited, a world leader in the design and manufacture of revolutionary thin-form supercapacitors, which considerably extend the performance of batteries, announces its interim results for the half-year ended 31 December 2015.
Financial Highlights
· Total Revenue of A$1.6m down 27% on the corresponding half year due to the deferment in orders, as announced by CAP-XX on 12 October 2015, and the increased lead time for new projects to scale up to full volume.
· Murata royalty contribution has more than tripled from the corresponding half year in 2015.
· CAP-XX remains excited by the number of large scale sales opportunities that it is working on.
· Gross Margin at A$629,000 was steady with 1H14 Gross Margin of A$657,000, due to realised manufacturing cost savings.
· Net Loss increased to A$1.3m (1H14: A$0.9m) due to increased overheads of A$457,000 (1H15 A$2.7m vs. 1H14 A$2.1m) attributable to:
· the development of large supercapacitor modules (including TruckStart);
· increased licencing activity;
· design enhancements to improve performance from the existing product range;
· evaluation of alternative lower cost raw materials; and
· commissioning of new production plant and machinery.
· Post period end, AVX and CAP-XX have agreed terms for a worldwide non-exclusive licence of the CAP-XX patents to AVX for a range of prismatic and cylindrical supercapacitor sizes. Under the terms of the licence, CAP-XX expects to receive upfront licence fees over a three year period and a 5% royalty. The initial upfront licence fees receivable by CAP-XX for the first twelve months will be a minimum of £1.26 million (approximately A$2.4m), with payments in subsequent years being subject to AVX maintaining the licence.
· Cash reserves of A$0.9m at the period end (1H14: A$0.5m) which includes the receipt of a tax rebate from the Australian Taxation Office of A$1.1m (1H14 A$1.2m) but before any payments by AVX.
Operational Highlights
· MOU with Global Tier-1 Automotive components company for TruckStart application extended.
· TruckStart product available as evaluation units, with new product variants for different markets under development.
· Joint product development agreement with Thales Research Centre for the avionics market is continuing.
· CAP-XX's Thinline family of supercapacitors for applications in the IoT is showing good progress. The number of customers actively evaluating CAP-XX's Thinline supercapacitors continues to increase, with one lead customer planning mass production trials.
· Operational cost savings continued to be delivered with Gross Margin increasing to 38% from 29%, with additional savings to come.
· The AVX licence and ongoing other licensing negotiations highlight the extent and wide-ranging applicability of CAP-XX's Intellectual Property portfolio especially as increasingly manufacturers are seeking power delivery solutions beyond the capability of current battery technology.
Summary
· The Directors are pleased with the Company's ongoing progress despite the temporary reduction in sales.
· Changes in manufacturing processes are continuing to reduce unit costs and improve product quality. Further improvements in Gross Margin are expected.
· The lower unit costs extend CAP-XX competitiveness and establishes the platform for significant volume growth.
· There are numerous sales opportunities in design and engineering phases that provide potential for higher volumes.
· Licensing activity is much higher than last year and is expected to deliver further outcomes.
For further information contact:
CAP-XX Limited | |
Anthony Kongats (Chief Executive Officer) | +61 (0) 2 9428 0139 |
Allenby Capital Limited (Joint Broker) | |
David Hart/Alex Brearley (Corporate Finance) | +44 (0) 20 3328 5656 |
Kreab | |
Robert Speed (Financial PR) | +44 (0) 20 7074 1800 |
More information is available at www.cap-xx.com
Notes to Editors:
CAP-XX (LSE:CPX) is a world leader in the design and manufacture of thin flat supercapacitors and energy management systems used in a range of applications including portable and small-scale electronic devices; automotive; and renewable energy. The unique feature of CAP-XX supercapacitors is their very high power density and high energy storage capacity in a space-efficient prismatic package. These attributes are essential in power-hungry consumer and industrial electronics, and deliver similar benefits in automotive and other transportation applications. For more information about CAP-XX, visit www.cap-xx.com.
Chairman's Statement
CAP-XX has made good progress in the past six months in validating its two pronged business model incorporating the licensing of intellectual property combined with direct manufacturing and sale of products, as evidenced by the following developments:-
· AVX and CAP-XX have agreed terms for a worldwide non-exclusive licence of the CAP-XX patents to AVX for a range of prismatic and cylindrical supercapacitor sizes. Under the terms of the licence, CAP-XX expects to receive upfront licence fees over a three year period and a 5% royalty. The initial upfront licence fees receivable by CAP-XX for the first twelve months will be a minimum of £1.26 million, with payments in subsequent years being subject to AVX maintaining the licence.
· The memorandum of understanding ("MoU") with a Global Tier-1 automotive components company has been extended following the successful evaluation of the CAP-XX supplied modules.
· New products under development for new markets using the truckStart concept.
· The Thinline family of supercapacitors for applications in the IoT is showing good progress. The number of customers actively evaluating CAP-XX's Thinline supercapacitors continues to increase, with one lead customer planning mass production trials.
· Increased the voltage rating of the Company's Thinline and single G series cells to 2.5V and 2.75V peak and the dual cells to 5V and 5.5V peak.
· New 30 year long life product under development.
· Additional cost reductions achieved with more identified for FY2016/17.
These developments provide the Company with the required confirmation that the ongoing development and future potential of the CAP-XX technology associated with supercapacitors is valued by external organisations. Interest in the CAP-XX technology remains high with additional potential licensees, across various markets, in preliminary discussions with CAP-XX.
The licensing arrangements, together with the R&D cash rebate from the Australian Taxation Office, provide the Company with the necessary funds and resources to assist with the continuing development of the CAP-XX supercapacitor technology in both large and small market applications.
For the six months ended 31 December 2015, product sales revenue was A$1.5m (1H14: A$2.2m), with year on year volumes declining and average selling prices increasing by 15%. The decrease in the volume of supercapacitors shipped was due to the deferment in orders as announced by CAP-XX in its announcement of 12 October 2015 and the increased lead time for new projects to scale up to full volume. The later may be linked to the global softening in the worldwide electronic component markets, with end customers continuing to defer previous orders from the first half of the financial year to the second half of the year. Although the interest and evaluation of products targeted for the Internet of things (IoT) markets has been high, the achievement of committed orders in the first half of the year has been slower than hoped.
On a pleasing note, Murata's royalties continue to grow from a modest base and contributed A$136,000 for the half year which is a 268% improvement from last year. In addition, CAP-XX continues to make inroads on its manufacturing cost saving strategy by continuing to focus on shortening the production lead time, reducing materials cost, and increasing production yield. As a result, the reported Gross Margin increased to 38% compared to 29% for the same period last year. Consequently the Gross Margin was steady at A$629,000 for 1H15.
The operating loss before tax was A$1.3m (1H14: A$0.8m). CAP-XX has continued to increase its commitment to building its business by increasing the overhead resources for the development of its technology with particular emphasis being placed on the large cell module for automotive applications; licencing; Thinline products; manufacturing improvements including the evaluation of alternative raw materials; the commissioning of new plant and machinery; and the ongoing improvement and enhancement of the existing product range. As at 31 December 2015, the Company had cash reserves of A$0.9m (1H14: A$0.5m) which includes the receipt of a tax rebate from the Australian Taxation office of A$1.1m (1H14: A$1.2m).
The Board firmly believes that the recent announcements and associated funding will provide the Company with the necessary resources to underpin the business for the foreseeable future and will also provide the necessary credibility in order to create additional opportunities in new and emerging markets, such as IoT. The Board remains confident that the Company's strategy will continue to be successful and looks forward with some optimism in reporting the results for the full year ending 30 June 2016 later in the year.
Patrick Elliott
Chairman
30 March 2016
CAP-XX Limited
Consolidated statement of profit or loss - Unaudited
For the half-year ended 31 December 2015
Consolidated | |||
Half-year 2015 | Half-year 2014 | ||
Currency: Australian Dollars | $ | $ | |
Revenue from sale of goods and services | 1,644,355 | 2,265,654 | |
Cost of sale of goods and services | (1,014,929) | (1,608,662) | |
Gross margin (loss) on sale of goods and services | 629,426 | 656,992 | |
|
| ||
Other revenue | 21,866 | 6,769 | |
Other income | 690,221 | 573,996 | |
General and administrative expenses |
(1,117,635) |
(953,764) | |
Process and engineering expenses | (390,075) | (299,873) | |
Selling and marketing expenses | (344,234) | (254,982) | |
Research and development expenses | (779,058) | (568,495) | |
Other expenses | (41,349) | (33,747) | |
(Loss) before income tax | (1,330,838) | (873,104) | |
|
| ||
Income tax benefit/(expense) | - | - | |
Net loss after income tax for the half year | (1,330,838) | (873,104) | |
(Loss) attributable to members of CAP-XX Limited | (1,330,838) | (873,104) | |
Loss per share attributable to the ordinary equity holders of the company | Cents | Cents | |
Basic earnings per share | (4.95) | (0.76) | |
Diluted earnings per share | (4.95) | (0.76) | |
CAP-XX Limited
Consolidated statement of financial position
As at 31 December 2015
Consolidated |
| |||
31 December 2015 | 30 June 2015 | 31 December 2014 | ||
(Unaudited) | (Audited) | (Unaudited) | ||
Currency: Australian Dollars | $ | $ | $ | |
ASSETS | ||||
Current assets | ||||
Cash and cash equivalents | 925,334 | 2,643,418 | 546,466 | |
Receivables | 408,832 | 685,192 | 594,730 | |
Inventories | 2,040,548 | 1,409,463 | 934,914 | |
Other | 807,198 | 1,252,158 | 531,821 | |
Total current assets | 4,181,912 | 5,990,231 | 2,607,931 | |
|
| |||
Non-current assets |
|
| ||
Property, plant and equipment | 389,012 | 301,272 | 375,147 | |
Other | 236,507 | 236,507 | 236,507 | |
Total non-current assets | 625,519 | 537,779 | 611,654 | |
|
| |||
Total assets | 4,807,431 | 6,528,010 | 3,219,585 | |
|
| |||
LIABILITIES |
|
| ||
Current liabilities |
|
| ||
Payables | 589,767 | 1,074,711 | 785,684 | |
Provisions | 929,299 | 915,862 | 923,679 | |
Progress payments - Sale of Plant | - | - | - | |
Total current liabilities | 1,519,066 | 1,990,573 | 1,709,363 | |
|
| |||
Non-current liabilities |
|
| ||
Provisions | 55,767 | 42,487 | 36,838 | |
Total non-current liabilities | 55,767 | 42,487 | 36,838 | |
Total liabilities | 1,574,833 | 2,033,060 | 1,746,201 | |
|
| |||
Net assets | 3,232,598 | 4,494,950 | 1,473,384 | |
|
| |||
|
| |||
EQUITY |
|
| ||
Contributed equity | 94,477,373 | 94,426,347 | 90,405,581 | |
Reserves | 3,681,757 | 3,664,297 | 3,656,263 | |
Accumulated losses | (94,926,532) | (93,595,694) | (92,588,460) | |
TOTAL EQUITY | 3,232,598 | 4,494,950 | 1,473,384 | |
CAP-XX Limited
Consolidated statements of changes in equity - Unaudited
For the half-year ended 31 December 2015
Consolidated | |||||
Contributed Equity $ | Reserve $ | Accumulated losses $ | Total $ | ||
| |||||
Balance at 1 July 2014 | 90,293,839 | 3,676,779 | (91,715,356) | 2,255,262 | |
Loss for the period as reported in the 2015 financial statements | - |
| (1,880,338) | (1,880,338) | |
Other comprehensive income | - | (139,539) | - |
(139,539) | |
Transactions with owners in their capacity as owners: | |||||
Contributions of equity, net of transaction costs and tax | 4,132,508 | 4,132,508 | |||
Employee share options ‑ value of employee services |
| - | 127,057 | - | 127,057 |
4,132,508 | 127,057 | - | 4,259,565 | ||
Balance at 30 June 2015 | 94,426,347 | 3,664,297 | (93,595,694) | 4,494,950 | |
Profit for the period as reported in the 2015 interim financial statements | - | - | (1,330,838) | (1,330,838) | |
Other comprehensive income | - | (52,865) | - |
(52,865) | |
Transactions with owners in their capacity as owners: | |||||
Contributions of equity, net of transaction costs and tax | 51,026 | - | - | 51,026 | |
Employee share options ‑ value of employee services | - | 70,325 | - | 70,325 | |
51,026 | 70,325 | - | 70,325 | ||
Balance at 31 December 2015 | 94,477,373 | 3,681,757 | (94,926,532) | 3,232,598 | |
CAP-XX Limited
Consolidated Statement of Cash Flows - Unaudited
For the half-year ended 31 December 2015
Consolidated | |||
Half-year 2015 | Half-year 2014 | ||
Currency: Australian Dollars | $ | $ | |
Cash flows from operating activities | |||
Receipts from customers (inclusive of goods and services tax) | 2,146,905 | 2,492,221 | |
Payments to suppliers and employees (inclusive of goods and services tax) | (4,827,785) | (3,963,024) | |
(2,680,880) | (1,470,803) | ||
Tax credit received | 1,127,272 | 1,172,447 | |
Interest received | 21,866 | 6,769 | |
Net cash (outflow) inflow from operating activities | (1,531,742) | (291,587) | |
|
| ||
Cash flows from investing activities |
|
| |
Payments for property, plant and equipment | (184,503) | (88,654) | |
Net cash (outflow) inflow from investing activities | (184,503) | (88,654) | |
Cash flows from financing activities | |||
Proceeds from issue of shares | 51,026 | 111,742 | |
Net cash inflow from financing activities | 51,026 | 111,742 | |
|
| ||
Net increase (decrease) in cash and cash equivalents | (1,665,219) | (268,499) | |
Cash and cash equivalents at the beginning of the half-year year | 2,643,418 | 900,397 | |
Effects of exchange rate changes on cash and cash equivalents | (52,865) | (85,432) | |
Cash and cash equivalents at the end of the half-year year |
| 925,334 | 546,466 |
This general purpose interim financial report, for the half-year reporting period ended 31 December 2015, has been prepared in accordance with Australian equivalents to International Financial Reporting Standards (AIFRSs), other authoritative pronouncements of the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the Corporations Act 2001. This general purpose interim financial report, for the half-year reporting period ended 31 December 2015, is (with the exception of the figures for 30 June 2015in the Balance Sheet) unaudited.