Getech Grp Regulatory News (GTC)

6 April 2022

Getech Group plc

("Getech" or the "Company")

Trading Update and Outlook

A transformational year, facilitating a strong outlook

Getech, a geoenergy and green hydrogen company, is pleased to provide an update on its trading and outlook ahead of the publication of its full year results for the year ended 31 December 2021 ("FY2021"), which will be announced during May 2022.

Highlights

· Following receipt of £6.25 million of equity proceeds in April 2021, Getech repositioned its business model and strategy to support the accelerated delivery of a secure and sustainable path to decarbonisation.

· During FY2021, the Company has done this by:

o expanding the application of Getech's unique geoscience and data products into essential tools for locating and developing new geothermal, critical minerals, carbon/energy storage and green hydrogen projects;

o establishing a new low carbon 'locate-develop-operate' business model;

o investing in the team - hiring senior executives in engineering, economics, project delivery and business development, and adding Board skills in business scale up, ESG and low carbon asset management;

o leveraging its status as a trusted partner to build strategic relationships for participation in decarbonisation projects; and

o acquiring a green hydrogen development company, and securing the first two development projects in Shoreham and Inverness.

· Strong performance in FY2021 has continued into FY2022:

o FY2021 revenue from geoenergy products and services rose c. 20% to £4.3m (2020: £3.6m), in line with market expectations;

o orderbook grew by 25% to £3.3m at 31 December 2021 (31 December 2020: £2.7m);

o focus on responsible capital management with strong net cash position of £5.1m at 31 December 2021; and

o growth in revenues and sales continued into FY2022 with robust Q1 22 performance, facilitating a strong outlook ahead.

Getech - a geoenergy and green hydrogen company

Geoenergy encompasses technologies, raw materials and energy sources that interact with the geological subsurface and these dovetail with other distributed energy solutions, such as green hydrogen. Getech's expertise and focus are on the following sectors:

· Green Hydrogen. Getech is developing its own network of green hydrogen hubs that convert renewable power into green hydrogen aimed at decarbonising commercial transport. 

· Geothermal. Getech identifies and develops geothermal projects using its geoscience and geospatial capabilities to provide low carbon, baseload and flexible power and heat.

· Critical minerals. Getech analyses and establishes the specific factors responsible for the location and economic concentration of minerals critical to the energy transition.

· Sustainable carbon production and storage. Getech supports the delivery of a sustainable energy transition by identifying the highest value hydrocarbons with lowest carbon footprint and the development of integrated carbon capture and storage solutions.

Business model

Getech's newly established business model is to locate, develop and operate geoenergy and green hydrogen assets:

Locate - The Company provides products and services to asset owners to help locate, de-risk and optimise geoenergy projects to meet the energy transition targets.

To align with these needs, during FY2021 Getech built and released a number of solutions positioning them as essential tools for the energy transition with usability features for carbon storage, critical minerals and geothermal sectors.

Develop and operate - Getech's products and services enable it to establish revenue-generative relationships with both natural resource asset owners and energy consumers, which Getech can then expand into strategic alliances to build its own portfolio of low carbon assets.

During FY2021, Getech completed its first direct asset investment in green hydrogen, purchasing H2 Green, a company developing green hydrogen networks of production, storage, and distribution facilities to decarbonise commercial transport.  New hires and leverage of Getech's capabilities, has considerably strengthened the operational capability of the Group's hydrogen development operations - streams of excellence added in facility design, project management, economic modelling and business development. As a result of this work, the Company signed strategic alliances with a number of industry partners, secured exclusivity across a wide portfolio of hub locations, and is now working to develop its first green hydrogen hubs.

Outlook and growth strategy

Increased global demand for sustainable and secure energy provides a solid platform for Getech to deliver growth and expansion. Aligned with growing revenue, a strong balance sheet and a robust business development pipeline, Getech's Board is confident in the Company's outlook.

The growth in sales and revenue achieved during FY2021 has continued into Q1 2022, demonstrating strong demand for Getech's products and services in locating and de-risking a wide range of energy and mineral resources, across different geographies. The Company anticipates this growth momentum to continue as the pace of progress to net zero accelerates.

The Company's first two green hydrogen hubs in Inverness and Shoreham are progressing towards development. In Shoreham, the Company is finalising a detailed development schedule, which it expects to review and agree with the port authority in Q2 2022. Development planning is also underway at the Inverness site, with an agreement with the Highland Council opening the potential for this anchor project to be scaled into a regional green hydrogen network.

Across the balance of 2022 Getech's focus will be on the continued delivery of its growth strategy, which is positioned to accelerate the energy transition and deliver shareholder value by:

o expanding the Company's robust pipeline of products and services for the energy transition;

o replicating and scaling up its green hydrogen asset development model, both in UK and internationally;

o building strategic partnerships to secure and develop geothermal energy projects; and

o pursuing energy co-location opportunities within the critical minerals sector.

Getech's Chief Executive Office, Dr Jonathan Copus, commented:

"It is clear the world needs to substantially increase energy investment to meet the goals of energy security and transition to a low carbon future. In 2022, fuelled by growth in company and government spend, energy investment could total as much as 13% of global GDP, the highest level on record.

Getech is ideally positioned to support this 'waterfront' expansion in energy capital spending. This has driven revenue and orderbook growth by 20% and 25% respectively in FY2021 and has resulted in a significant broadening in our sales and business development pipelines, with the positive trend continuing into 2022.

By investing in our unique geoscience data and software products, we are extending their application to high-growth geoenergy sectors beyond petroleum - targeting geothermal, critical minerals, hydrogen and carbon storage. The rapid expansion of our green hydrogen development activities also demonstrates how we are leveraging our foundation products and expertise to build strategic relationships that open opportunities for Getech to participate in high-value decarbonisation projects.

We have positioned our locate-develop-operate business model to maximise the value of our products, technologies, and skills, and to deliver transformational growth in shareholder value. We have moved into 2022 with confidence and look forward to increasing our share of a primary energy market that is undergoing unprecedented change and growth."

This update is provided in advance of the financial statements for the year ended 31 December 2021. The information and commentary provided is based on unaudited management accounts and other internal performance measures and is subject to concluding the routine annual accounting adjustments as well as any adjustments that arise as a result of the external audit process. 

This announcement contains inside information.

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Notes to editors:

Getech Group plc (AIM: GTC) applies its world-leading geoscience data and unique geospatial software products to accelerate the energy transition by locating, developing and operating geoenergy and green hydrogen projects.

For further information, please visit www.getech.com.