Half Yearly Report

RNS Number : 5522P

CAP-XX Limited

27 March 2009

 



27 March 2009

CAP-XX Limited

Interim Results for the half-year ended 31 December 2008

Financial Highlights

• Sales Revenue of A$4.4m was 69% higher than the corresponding period last year

• Net Operating Loss of A$1.6m was a 65% improvement over the corresponding period last year

• Cash Balance as at the end of January was A$3.0m

Operational Highlights

• Completed all actions required by CAP-XX under the partnership agreement with Murata

• All scheduled payments were received from Murata as planned

• Secured multiple design wins for Solid State Drive (SSD) applications

• Signed first stage of collaborative R&D Agreement with Murata

• Signed the Murata Re-Sale Agreement

• Made significant progress in the development of a surface mount supercapacitor

Anthony Kongats, CEO of CAP-XX said

'The principal focus during the period was to ensure that the milestones and deliverables as per the Murata agreement were completed on schedule. This has been achieved and I am pleased to report that CAP-XX's partnership with Murata has made excellent progress towards reaching both its short and long term goals. In addition, development of new products and of new markets for our existing products has been extremely encouraging. 

For further information contact:

CAP-XX Anthony Kongats, Chief Executive Officer	[phone]
Kreab Gavin Anderson (Financial PR) Robert Speed / Deborah Walter / Stuart Macaulay	[phone]
Seymour Pierce Ltd (Nominated Adviser and Broker) Nandita Sahgal	[phone]

More information is available at www.cap-xx.com

Notes to Editors:

CAP-XX is a world leader in the design and manufacture of thin form supercapacitors and energy management systems, predominantly for portable electronic devices.

The unique feature of CAP-XX's supercapacitors is their ability to store high volumes of energy and output high power levels within a thin form design. These attributes will be critical for the next generation of high volume, power-hungry portable electronic devices, including mobile phones. 

Portable devices are one of the fastest growing segments of the electronics market and provide the greatest opportunities for CAP-XX's products. CAP-XX's products are already an established enabling technology for the current generation of wireless devices and portable devices.

Chairman's Review

Business overview

The principal focus for the CAP-XX business in the half year ending 31 December 2008 and in the subsequent period has been to ensure that CAP-XX has met all of its commitments relating to the Murata Definitive Agreement which was signed on May 25th, 2008. I am therefore pleased to report that all of the CAP-XX actions have been successfully completed and all of the anticipated payments from the Technology Transfer were received on time.

CAP-XX's consistent strategy has been to develop relationships with mobile phone manufacturers that will lead to them designing CAP-XX supercapacitors into their products and at the same time providing the manufacturing credibility to deliver large volumes of reliable high quality devices to fulfil their requirements. Obviously, the Murata agreement 'de-risks' this strategy. Murata has advised that they remain on schedule in scaling up their high volume supercapacitor manufacturing capability for production towards the end of the current calendar year. Due to the duplication in sales resources servicing the major mobile handset manufacturers, it was agreed that Murata would take the sales and marketing lead and the handover was completed by the end of 2008. Progression towards a mobile design win remains a high priority and good progress has been made over the past six months. 

Subsequent to the main Agreement, we signed a Re-Sale Agreement with Murata in October 2008 which will enable a proportion of Murata's manufactured product to be sold under the CAP-XX name. The first stage of the joint product development program was also agreed and the Feasibility Agreement (Stage 1) was signed in November 2008 and will be completed in early April 2009. The Stage 1 component did provide CAP-XX with additional funding during this period. The joint development program is targeted specifically at the completion of a second generation supercapacitor which has surface mount capability. Significant progress has been made and CAP-XX is ahead of its earlier project schedule. Negotiations are continuing with Murata in relation to Stage II of the joint development program.

As highlighted in the 2008 Annual Report, a new market that is looking very attractive is the Solid State Drive (SSD) opportunity. CAP-XX's superior footprint and energy density facilitate the SSD opportunity and we have secured 11 SSD design wins to date. 

Sales revenue of A$4.4m grew by 69% compared to the corresponding period last year which was primarily due to the Murata relationship. The global financial crisis is making life more difficult for us like every other company, and the ability to forecast customer product drawdown remains a challenge. It was always planned that duplicate support functions as a result of the Murata relationship would necessitate a headcount reduction at CAP-XX. This, coupled with the current economic climate, has resulted in CAP-XX reducing its total headcount by 15 since the close of the first half which will significantly reduce the cost base.

The CEO and the senior management team have made significant progress, especially with the Murata relationship and with the implementation of the cost reduction program, which have together positioned the company well for future success. 

CAP-XX Limited

Income statement - Unaudited

For the half-year ended 31 December 2008

		Consolidated
		Half-year 2008	Half-year 2007
Currency: Australian Dollars		$ ' 000	$ ' 000
Revenue from sale of goods and services		4,441	2,631
Cost of sale of goods and services		(2,232)	(3,115)
Gross margin (loss) on sale of goods and services		2,209	(484)
Other income		42	237
General and administrative expenses		(1,709)	(1,895)
Process and engineering expenses		(508)	(447)
Selling and marketing expenses		(807)	(854)
Research and development expenses		(960)	(893)
Foreign exchange gains/(losses)		258	(111)
Other expenses		(75)	(14)
(Loss) before income tax		(1,550)	(4,461)
Income tax benefit/(expense)		-	(12)
Net (loss) for the half year		(1,550)	(4,473)
(Loss) attributable to members of CAP-XX Limited		(1,550)	(4,473)
Earnings per share for (loss) attributable to the ordinary equity holders of the company		Cents	Cents
Basic earnings per share		(3.2)	(9.1)
Diluted earnings per share		(3.2)	(9.1)

CAP-XX Limited

Balance sheet - Unaudited

As at 31 December 2008

		Consolidated	Consolidated	Consolidated
		31 December 2008	30 June 2008	31 December 2007
Currency: Australian Dollars		$ ' 000	$ ' 000	$ ' 000
ASSETS
Current assets
Cash and cash equivalents		565	3,481	5,551
Receivables		3,960	360	1,390
Inventories		1,309	1,087	1,423
Other		192	110	177
Total current assets		6,026	5,038	8,541
Non-current assets
Property, plant and equipment		2,210	1,597	3,073
Other		208	208	208
Total non-current assets		2,418	1,805	3,281
Total assets		8,444	6,843	11,822
LIABILITIES
Current liabilities
Payables		1,816	2,018	1,782
Other - deferred service revenue		1,316	1,532	-
Provisions		526	559	499
Total current liabilities		3,658	4,109	2,281
Non-current liabilities
Other - deferred service revenue		3,157	-	-
Provisions		186	154	169
Total non-current liabilities		3,343	154	169
Total liabilities		7,001	4,263	2,450
Net assets		1,443	2,580	9,372
EQUITY
Contributed equity		75,786	75,787	75,786
Reserves		2,146	1,734	1,419
Accumulated losses		(76,489)	(74,941)	(67,833)
TOTAL EQUITY		1,443	2,580	9,372

CAP-XX Limited

Statements of changes in equity - Unaudited

For the half-year ended 31 December 2008

		Consolidated
		Half-year 2008	Half-year 2007
Currency: Australian Dollars		$ ' 000	$ ' 000
Total equity at the beginning of the half year		2,580	13,395
Exchange differences on translation of foreign operations		46	20
Net (loss) recognised directly in equity		46	20
(Loss) for the half year		(1,549)	(4,473)
Total recognised income and expenses for the half year		(1,503)	(4,453)
Transactions with equity holders in their capacity as equity holders:
Employee share options		366	366
Exercise of options		-	64
		366	430
Total equity at the end of the half-year		1,443	9,372

  CAP-XX Limited

Cash flow statements - Unaudited

For the half-year ended 31 December 2008

		Consolidated
		Half-year 2008	Half-year 2007
Currency: Australian Dollars		$ ' 000	$ ' 000
Cash flows from operating activities
Receipts from customers (inclusive of goods and services tax)		5,778	2,303
Payments to suppliers and employees (inclusive of goods and services tax)		(7,898)	(7,120)
		(2,120)	(4,817)
Interest received		42	232
Net cash (outflow) inflow from operating activities		(2,078)	(4,585)
Cash flows from investing activities
Payments for property, plant and equipment		(838)	(672)
Net cash (outflow) inflow from investing activities		(838)	(672)
Cash flows from financing activities
Proceeds from issue of shares		-	64
Net cash inflow from financing activities		-	64
Net increase (decrease) in cash and cash equivalents		(2,916)	(5,193)
Cash and cash equivalents at the beginning of the half-year year		3,481	10,744
Cash and cash equivalents at the end of the half-year year		565	5,551

This general purpose interim financial report, for the half-year reporting period ended 31 December 2008, 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 2008, is (with the exception of the figures for 30 June 2008 in the Balance Sheet) unaudited.

 

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