Intelligent Energy Holdings: Trading In Line With Expectations
Edison | Jul 18, 2017 02:18AM ET
Intelligent Energy Holdings’(LON:IEH) interims were in line with the guidance given at the AGM in March. The results demonstrate that management has succeeded in reducing cash burn to its stated target of c £1.6m/month. It intends to bring the group to a cash break-even position within the next two years through volume roll-out of standard air-cooled products. Project wins during the period indicate there is appetite for Intelligent Energy’s fuel cell stacks in the target markets, although we note that additional funding will be required to support this process. We leave our estimates unchanged.
Cash-burn reduction target achieved
Stripping out revenues from the power management activity, which was discontinued in November (£16.7m H117, £40.9m H116), revenues dropped from £3.0m to £2.0m. Total adjusted EBITDA losses more than halved from £21.6m to £9.1m, reflecting the cost-reduction programme implemented during H216. Cash consumption during the half-year period totalled £7.7m, of which £2.0m was interest on the convertible loan notes, leaving £13.0m at the end of March. Our model shows that if costs are maintained at these levels, the group has sufficient cash to support the expected growth in commercial products during FY17, but will need to secure additional funding to reach positive cash flow. Management is in discussions with potential customers to deliver a trading-related solution.
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Intelligent Energy Holdings - Trading In Line With Expectations
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