AFC Energy Announces Final Results for Year Ended 31 October 2020

AFC Energy (AIM: AFC), a leading provider of hydrogen power generation technologies, is pleased to announce its results for the year ended 31 October 2020.  Highlights of those results are as follows.

 Commercial 

 ·      Six-month engagement with global e-mobility leader, ABB, culminating in the post year-end formation of a Strategic Partnership to develop high power Electric Vehicle (EV) charging solutions with established route to a growing worldwide EV market.

 ·      Achieved first commercial orders, including appointment as Official Charging Partner of FIA Accredited Extreme E in 2021, providing sustainable off-grid power for rapid vehicle charging.

 ·      Confirmed initial order book of £1.1m at year end, with strong pipeline of commercial orders across prospective partners and distributors currently under development.

 ·      Announced collaboration with global contractor ACCIONA, highlighting opportunities for sustainable construction and temporary power applications. 

 ·      Introduced potential for alkaline fuel cell adoptions in high growth micro grid applications with system sale to Forschungszentrum Jülich (“Jülich”) at its Living Lab Energy Campus (“LLEC”) showcase in Germany.

 ·      Commenced strategic relationship with Ricardo plc post year-end to explore alkaline fuel cell deployment across global maritime, rail and stationary markets following growth in enquiries – all new target industries for the business.  

 ·      Oversubscribed £31.6m fundraise, strengthening balance sheet for accelerated growth. 

 Manufacturing

 ·      Confirmation of capital light manufacturing and scale up strategy through supply chain strengthening in preparation for near term growth potential in commercial orders.

 ·      Cemented partnership with BK Gulf through post year-end agreement for mass scale up of containerised and skid mounted fuel cell system fabrication.

 ·      Agreement reached post year-end to lease 30,000 sq. ft UK based facility for the assembly, commissioning and dispatch of fuel cell systems to customers.   

 Technology

 ·      Prototype design of high-density “S” series fuel cell system completed and work commenced to assemble and demonstrate “short stack” performance, prior to scaling up to full scale 10kW stack in 2021 and expected release of commercial-scale stacks to the market in late 2022.

 ·      Initial supply of AlkaMem® membrane samples across multiple non-fuel cell applications demonstrating the diversity of revenue opportunities across non-core markets.

 ·      Design and engineering of world class testing and research lab for high density fuel cell, launched after year-end in February 2021.

Key Financial Highlights

·      Stronger year end cash balance of £31.6m (FY 2019: £1.6m), providing the basis for future growth.

·      Growing investment in product range reflected in increased loss of £4.2m (FY 2019: £2.9m).

·      Strong pipeline growth across all target markets post year-end with potential for commensurate revenue.

 Outlook

·      Unprecedented global investment in hydrogen, with $300bn project pipeline and 30 of the world’s largest economies already having national Hydrogen strategies in place.

 ·      Principle of ‘building back better’ and the bringing forward of EV deployment post COVID-19 is driving strong Government action on decarbonisation.

 ·      Leveraging the value of existing and new international partnerships to enhance commercial route to market remains central to driving growth in top line commercial revenue.

 ·      Systems to be completed and deployed to reinforce political & regulatory support for industry’s viable transition away from diesel, with anticipated drive towards commercial sales.

·      Stronger balance sheet to support further investment in containerised fuel cell systems to meet customer demand and hone supply chain and manufacturing scale up potential.

 ·      Planned deployment of first integrated EV charger system alongside ABB in second half of 2021.

 ·      Target delivery of first prototype high energy density “S” series fuel cell stack with adoption of AFC Energy’s new Alkamem® membrane technology in 2021.

 ·      Continued international promotion of our work through the Hydrogen Council and the Ammonia Energy Association.

 Adam Bond, Chief Executive of AFC Energy, said:  “2020 was the year that hydrogen took centre stage as a key enabler of a more sustainable future, fuelling a transformational year for AFC Energy.  A growing order book, new strategic partnerships, a stronger cash position at year-end and a strong global political will, evidenced by record levels of investment in the sector, provides the basis for our future success. 

Our outlook for the coming year is one of confidence, with both Governmental policies and industry sentiment driving sustainable change in our key target markets.  The Company’s stronger balance sheet position enables us to invest in our people, products and technology and we therefore expect cash burn to increase in the coming year to deliver and grow our order book. 

Leveraging the value of our existing international partnerships and collaborations remains central to our approach in 2021.  With the required distribution channels, manufacturing and staffing being put in place to turn our enquiry pipeline into commercial sales with significant annuity revenue, I look forward to us making a growing contribution to delivering emissions-free solutions to the world’s energy challenges.”

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