Powerhouse Ener Regulatory News (PHE)

 25 August 2022

Powerhouse Energy Group plc

("Powerhouse" or the "Company")

Half Year Report

Powerhouse Energy Group plc (AIM: PHE), the UK technology company commercialising hydrogen production from plastic, is pleased to announce its unaudited interim results for the six months ended 30 June 2022.

Highlights

Commercial Development

Technology and Innovation

Financial Performance

Organisation and Growth

Statement from Keith Riley, Interim non-executive Chairman and acting CEO of Powerhouse Energy Group Plc

"Progress has been made in the first half of 2022 as we developed our business model to be more flexible and retain more control over our proprietary technology. We continue with our plans to develop a global technology and innovation centre to develop our knowhow and breadth of application.

"With the refocusing of our strategy and additional flexibility of our business model implemented, we are encouraged to see increased levels of interest on an international level in the Powerhouse proposition. Post period end we have announced that we have signed two Heads of Terms with Hydrogen Utopia, for two projects outside of the UK; one in Ireland and the other in Poland. Both of these territories are key markets for Powerhouse as they give the company positioning within the EU from where further business expansion can be made.; Poland is a European leader in revitalising its economy towards net zero carbon emissions, while Ireland is in the process of establishing its hydrogen strategy with view to becoming a major player in the emerging hydrogen economy.

"There have been additional changes to the management team post period end, however at working level, the business continues to grow in strength and advance the commercial implementation of its technology. I would like to thank Paul Drennan-Durose, Gill Weeks, Myles Kitcher and James Greenstreet for their contribution to the business and wish them will in their future endeavors. Paul Emmitt has been appointed to Chief Operating Officer. He has been Chief Technical Officer since July 2021 and has over twenty years of engineering and operational management experience both in the UK and overseas in the oil, gas, energy-from-waste and chemical industries, he is well placed to progress the Company's strategy. Chief Financial Officer, Chris Vanezis, is on paternity leave and Ben Brier is acting CFO during Chris' absence,

"There is much work to be done in the development of our projects as we continue on our path to commercial implementation. The changes implemented in our commercial relationships made during the first half of this year will create the foundation for the growth of the Company in the years to come. We look forward to updating investors on our progress as we move through the financial year."

For more information, contact:

About Powerhouse Energy Group plc

Powerhouse Energy has developed a proprietary process technology - DMG® - which can utilise waste plastic, end-of-life-tyres, and other waste streams to convert them efficiently and economically into syngas from which valuable products such as chemical precursors, hydrogen, electricity, and other industrial products may be derived. Powerhouse's technology is one of the world's first proven, distributed, modular, hydrogen from waste process.

Powerhouse's process produces low levels of safe residues and requires a small operating footprint, making it suitable for deployment at enterprise and community level.

Powerhouse is quoted on the London Stock Exchange's AIM Market under the ticker: PHE and is incorporated in the United Kingdom.

For more information see www.powerhouseenergy.co.uk

Statement of Comprehensive Income

The notes numbered 1 to 5 are an integral part of the interim financial information.

Statement of Financial Position

The notes numbered 1 to 5 are an integral part of the interim financial information.

Statement of Cash Flows

The notes numbered 1 to 5 are an integral part of the interim financial information.

Statement of Changes in Equity

The following describes the nature and purpose of each reserve within equity:

Share capital: Deferred shares: Represents the combined total of all deferred shares (0.5p, 4p and 4.5p)

Share premium: Amount subscribed for share capital in excess of nominal value

Merger relief reserve: Amount subscribed for share capital in excess of nominal value where merger relief applies

Accumulated deficit: Accumulated deficit represents the cumulative losses of the company and all other net gains and losses and transactions with shareholders not recognised elsewhere

The notes numbered 1 to 5 are an integral part of the interim financial information.

Notes (forming part of the interim financial information)

1. Summary of significant accounting policies

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the financial information.

1.1. Basis of preparation

This interim financial information is for the six months ended 30 June 2022 and has been prepared in accordance with International Accounting Standard 34 "Interim Financial Statements". The accounting policies applied are consistent with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board (IASB) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS (except as otherwise stated). The accounting policies and methods of computation used in the interim financial information are consistent with those of the previous financial year and corresponding interim reporting period and with those expected to be applied for the year ending 31 December 2022.

The Company does not consider any new and amended standards that became applicable for the current reporting period to have any impact on the Company's results.

The unaudited results for period ended 30 June 2022 do not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The comparative figures for the period ended 31 December 2021 for the Company are extracted from the audited financial statements which contained an unqualified audit report and did not contain statements under Sections 498 to 502 of the Companies Act 2006.

This interim financial statement will be, in accordance with the AIM Rules for Companies, available shortly on the Company's website.

1.2. Going concern

The Directors have considered all available information about future events when considering going concern. The Directors have prepared and reviewed cash flow forecasts for 12 months following the date of these Financial Statements. The projections show that the Company will have sufficient funding to be able to continue as a going concern on the basis of its cash balances as at 30 June 2022. 

The interim financial statements do not include the adjustments that would result if the Company were unable to continue as a going concern.

1.3. Functional and presentational currency

This interim financial information is presented in £ sterling which is the Group's functional currency.

1.4. Associated undertakings

Associates are entities which the Company has significant influence but not control or joint control as defined under IAS 28. This is generally the case where the Company holds between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting.

Under the equity method of accounting, investments are initially recognised at cost and adjusted thereafter to recognise the Company's share of the post-acquisition profits or losses of the investee in the Income statement. Dividends received or receivable from associates and joint ventures are recognised as a reduction in the carrying value of the investment.

When the Company's share of losses in an equity-accounted investment exceeds or equals its interest in the equity, the Company does not recognise further losses, unless it has incurred obligations or made payments on behalf of the other entity. Unrealised gains on transactions between the Company and its associates and joint ventures are eliminated to the extent of the Company's interest in these entities. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment in the asset transferred.

1.5. Revenue

The Company provides engineering services for the application of the DMG technology, the intellectual property that the Company owns. Revenue from providing services is recognised in the accounting period in which services are rendered. For fixed-price contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided to the extent to which the customer receives the benefits. This is determined based on the actual labour hours spent relative to the total expected labour hours.

Where contracts include multiple performance obligations as specified by the work scope, the transaction price will be allocated to each performance obligation based on estimated expected cost-plus margin.

Estimates of revenues, costs, or extent of progress toward completion of services are revised if circumstances change. Any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management.

In case of fixed-price contracts, the customer pays the fixed amount based on a payment schedule. If the services rendered by the Company exceed the payment, a contract asset is recognised. If the payments exceed the services rendered, a contact liability is recognised.

If a contract includes an hourly fee, revenue is recognised in the amount to which the Company has a right to invoice.

2. SHARE CAPITAL

The deferred shares have no voting rights and do not carry any entitlement to attend general meetings of the Company. They carry only a right to participate in any return of capital once an amount of £100 has been paid in respect of each ordinary share. The Company is authorised at any time to affect a transfer of the deferred shares without reference to the holders thereof and for no consideration.

3. Loss per share

4. SHARE BASED PAYMENT

The expense recognised for share-based payments during the year is shown in the following table:

The were no liabilities recognised in relation to share based payment transactions.

5. EVENTS AFTER THE REPORTING PERIOD

There are no events arising after the end of the reporting period to report in respect of the interim financial information.