2017 Trading Update

RNS Number : 8511D

RedT Energy PLC

05 February 2018

 

5 February 2018

This announcement contains inside information.

redT energy plc

("redT" or the "Company")

2017 Trading Update

redT energy plc (AIM:RED), the energy storage solutions company, provides an update on the Company's operations for 2017. We are pleased to report that since the announcement of redT's Interim Results 2017 (on 27 September 2017), orders for redT units have increased 269% alongside an 11% increase in final stage customer selection.

Commercial Update

	December 2017	September 2017	% change
Production & Deployment	54 units	16 units	+338%
Orders	43 units (€2.5m)	16 units	+269%
Final Stage Customer Selection	€18.3m (330 units)	€16.5m (205 units)	+11% (value)
Active Customer Pipeline	€357m	€323m	+11%

Note: redT tank unit module ("unit") = the size of redT's liquid energy storage machines differ from large containers to small containers.  In order to provide relative comparability across redT's product range, a uniform tank unit module metric is used.  For example; a 300 kWh system contains four 75kWh tank modules whereas a small 20kWh unit contains just one tank module

Key Commercial 2017 Highlights

·     redT's penetration into the off-grid market segment gained significant traction in the African continent. From an initial demonstration project in South Africa, the company closed its first commercial sale within the same region.  This was then followed by a volume sale order of 14 units to a customer in Botswana. Securing these orders has led to further final stage customer interest within the off-grid segment which has also been reflected in the redT pipeline.

·     The Company made strong progress in the UK commercial and industrial market segment with delivery of the key 1MWh demonstration project in Cornwall, working in conjunction with Centrica and The Olde House. Alongside a prior project successfully undertaken with E.ON, these demonstration sites have seeded redT's entry into this segment. By demonstrating a solid business case return for customers, redT has secured, within its pipeline, a significant number of viable projects and received multiple commercial orders across UK agriculture and industrial applications during 2017 as a result.

·     The Company secured its entry into the key Australian market with an order for a 300kW-1MWh hybrid energy storage system to Monash University. This marks the first commercial scale vanadium flow / lithium hybrid energy storage system that has been deployed in Australia, with the project providing an excellent platform from which redT can expand within this key market. Australia is one of the fastest growing energy storage markets globally, which has the potential to exceed the UK in terms of redT deployments.

·      redT secured partnership contracts with strong Central & Eastern European and South East Asian Distributors which led to an initial order of 9 redT tank units and a strong pipeline of interest. These partnership contracts enable the Company to focus on its core markets without expending additional resources to secure customers in these regions.

2017 also saw numerous positive developments for energy storage in the areas of policy and regulation both in the UK and abroad, these included; National Grid awarding flow machines the highest rating possible for capacity market auctions and the launch of numerous grants and subsidies which support businesses who wish to purchase energy storage.

The above highlights have enabled the Company to convert strong existing interest into a 269% increase in secured orders whilst continuing to grow the active customer pipeline - up 11% and final stage customer selection - also up 11% since September 2017.

Key Operational 2017 Highlights

·     In line with the Company's corporate strategy, redT invested heavily in its operations, resulting in a growth in headcount resource to 70 from 29 since January 2017. This investment has been central in redT being able to secure, deliver and scale its commercial success.

·     Key hires included David Stewart as Operational Director, from global manufacturing partner, Jabil Inc. and Bengt Stahlschmidt and Adam Whitehead from Gildemeister, in the key roles of Global Business Development Lead and Head of Research, respectively.

·     Stack production during the year moved from the UK to a lower cost base in Italy. The Company also successfully diversified its manufacturing capability by signing an agreement with a new UK partner to handle prototyping and small volume orders. This has increased supply chain flexibility and reduced process risk.

Financial Performance

Performance in the second half of the year for the business was as expected with full year trading anticipated to be in line with market expectations.

Outlook

redT focussed heavily on market penetration within its core segments throughout 2017 with significant commercial traction gained as a result. During 2018, these segments will be further developed with the aim of accelerating volume orders for delivery and closing large projects for delivery in 2019. In parallel, our Generation 3 product development is well underway and expected to be launched during the year. 

Scott McGregor, CEO, commented:

"2017 saw redT take a very clear and targeted approach developing three core direct customer markets and two partner markets which has built a very solid foundation for growth during 2018. The year to come will see further acceleration across these markets in volume sales of redT energy storage systems and the focused development of business opportunites for MW-scale projects to deliver in 2019. We are also very excited to be launching our 3rd Generation system this year which will further aid our drive for global market share."

Enquiries:

redT energy plc	[phone]
Scott McGregor, Chief Executive Officer
Joe Worthington, Investor & Media Relations
Cenkos Securities (Nominated Advisor & Broker)	[phone]
Derrick Lee
VSA Capital (Investor Relations Advisor) Andrew Monk	[phone]
Celicourt Communications (Financial PR) Mark Antelme Jimmy Lea Ollie Mills	[phone]

Notes to Editors

About redT energy

redT energy plc are experts in energy storage, specialising in the design, manufacture, installation and operation of energy storage systems which create revenue alongside reliable, low-cost renewable generation for businesses, industry and electricity distribution networks. Using patented vanadium redox flow technology to store energy in liquid, redT's own energy storage machines can be run continually with no degradation: charging and discharging for over 25 years, matching the lifespan of renewable assets in on-grid, off-grid and weak-grid settings.

redT's energy storage solutions, developed over the past 15 years, address today's changing energy market by providing a flexible platform for time shifting surplus renewable power, securing electricity supplies and earning revenue through grid services. The company has operating machines deployed with customers in the UK, Europe, sub-Saharan Africa, Australia and Asia Pacific. redT energy plc is listed on the London Stock Exchange (AIM:RED) and has offices in the UK, Africa and the USA. For more information, visit www.redTenergy.com

For sales, press or investor enquiries, please contact the redT team on [phone].

 

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