Trading Update

RNS Number : 4075C

Ilika plc

16 April 2013

 



 

Ilika plc

("Ilika" or the "Company")

Trading Update

Ilika (AIM: IKA), the advanced cleantech materials discovery company, provides the following trading update for the financial year ending 30 April 2013.

Operational Review

The main focus of Ilika's technology development remains on its solid-state lithium-ion battery technology, for which it successfully raised funds in April 2012. Progress remains on schedule with further tests on the prototype cells being conducted to ensure that the technology is as robust as possible and to continue to improve performance. It is currently filing additional intellectual property in the area to protect its proprietary position.

Following the announcement in December 2012, that the Company had received the grant of a key patent covering its novel fuel cell catalyst compositions in the US, Ilika has submitted positive cell performance data and material samples for evaluation by select automotive manufacturers based primarily in the US and Japan. Furthermore, Ilika's development partner in Taiwan has now successfully manufactured the catalyst material, which is a critical component of the battery cell, to Ilika's specification at the kilogram scale. This development progress ensures that the industrial production process can be readily transferred to any volume manufacturing partner.

Relationships with our other development partners and end customers across our other material development programmes remain strong, with announcements regarding renewals with its largest customer having been made in December 2012 and February 2013. Further such renewals are expected to continue in the coming financial year.

Financial Review

Despite significant operational progress across all its IP development programmes, the Company has experienced order delays with three unrelated contracts. Two of the contracts are from new customers in the US and the third is from a new customer in Europe. These are in the area of battery technology and structural materials. All three contracting processes are still live and the Company will update the market as soon as further news is available.

As a direct consequence of these delays, it is expected that revenue for the year ending 30 April 2013 will be approximately £1.1m (2012: £2.0m). This reduction in revenue expectation is directly reflected in a reduced EBITDA expectation (Earnings before Interest, tax, depreciation, amortisation and share based payments), which will be a loss of approximately £3.2m (2012: £1.8m). The loss before tax is expected to be approximately £4m (2012: £2.8m).

Following the successful expansion of facilities and infrastructure, cash balances will amount to approximately £1.8m at 30 April 2013 (2012: £5.3m). Overheads have been reduced following the successful disposal of Ilika's wound care operations, as announced in December, and costs will continue to be closely managed going forward.

Outlook

Budgeting in the next financial year will reflect the more conservative deal conversion rates and longer timelines experienced in this financial year.  Consequently, lower sales are forecast relative to previous expectations, but are underpinned by mature sales prospects.

In the coming financial year, the Company expects to reap the benefits of the infrastructure and development investments already made.

Ilika expects to announce its audited full year results for the year ended 30 April 2013 on or around 15 July 2013.

Commenting on the Trading Update, Graeme Purdy, Ilika's Chief Executive, said:  "We are disappointed with the delays in acquiring new customers that are impacting this year's financial performance. However, we are encouraged by the significant progress made in the development of our solid state battery technology and the initial reception given by the international automotive industry to our low cost fuel cell catalyst. Feedback from our customers is indicating sustained demand for innovation in both battery and fuel cell technologies to reduce the cost point for energy storage and motive power. This year has provided a strong springboard for further commercialisation milestones and revenue growth going forward. Further guidance will be given with our annual results in July."

For more information contact:

Ilika plc	www.ilika.com
Graeme Purdy, Chief Executive	Tel: [phone]
Steve Boydell, Finance Director
Numis Securities Limited	Tel: [phone]
Oliver Cardigan, Nominated Adviser
James Black, Corporate Broking
Walbrook PR Ltd	Tel: [phone] or [e-mail]
Paul McManus	07980 541 893
Paul Cornelius	07827 879 460

 

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