Applied Graphene Materials plc (LON:AGM), the producer of specialty graphene materials, has announced its interim results for the six months ended 31 January 2021.
Highlights
Operational highlights
Coatings:
· Approval for use of a new graphene-enhanced primer with Blocksil, to complement use of its AGM graphene-enhanced Top Coat MT product launched to consumers in January 2020
· New customer product launches:
o A new wax based car care product from EZ Car Care
o A new wax based car care product from Infinity Wax
· Availability of technical data for sustainable water based epoxy technology
· Blocksil commercial relationship starting to build momentum with orders from RTE, Network Rail and construction industry for Blocksil graphene enhanced products
· Repeat business from JBL for aerosol based primers
· Acceleration in customer engagements in the car care sector
· Growth in total pipeline engagements to 135 (2020: 92) including 10 completed developments (2020: nil) and resulting revenue potential to £3.7 million (2020: £2.9 million)
Composites and functional materials:
· Positive continuing progress with core composites customer
· Potential for TP300 product for thermal adhesive and heat-dissipation applications and graphene nanoplatelets (“GNPs”) for bearing applications
Distribution:
· Further distributors added to enhance our regional presence in Turkey (Gobarr) and South Korea (ManHo Polymers) and growth of our customer-facing representation headcount to around 79 including AGM’s direct sales team
Strategic highlights:
· Fundraise of £5.5 million (net) announced in January 2021 and successfully completed in February 2021, extending the Group’s cash runway well into 2023
· In partnership with the EU REACH Graphene Consortium, achieved ECHA accreditation for volume supply of graphene powder (up to 10 tonnes’ volume), addressing a significant barrier to deployment at scale
· Branding refresh completed together with new website and improved communications platform
· Continuing IP development
· Cross-trading of shares in USA on OTCQB from August 2020
· Extended product platform to address the growing sustainability challenges facing the coatings industry through water based epoxy product technology for low VOC coatings – extending AGM’s addressable opportunity. Launched customer products offering enhanced sustainable credentials through use of graphene
Financial overview
· Revenue – £42,000 (2020: £35,000)
· Operating expenses reduced by £0.5 million to £1.7 million (2020: £2.2 million)
· EBITDA* – loss of £1.6 million (2020: loss of £1.9 million)
· Loss before tax – £1.8 million (2020: loss of £2.3 million)
· Cash at bank – £2.3 million (2020: £4.3 million) – a further £5.5 million new funding and £0.46 million R&D tax credit was received in February 2021
· Basic EPS – loss of 3.3 pence per share (2020: loss of 4.0 pence)
* EBITDA comprises loss on ordinary activities before interest, tax, exceptional costs, depreciation and amortisation.
COVID-19
Continued focus on maximising the safety of our team members and maintaining business continuity. Activity at our customers’ sites is being monitored and we continue to work with them to maintain progress on our joint development projects. Existing customer sales momentum increasing as the impact of COVID-19 recedes.
Adrian Potts, Chief Executive Officer, commented:
“We have made good progress in the period both in our technology development and with specific customers, primarily in the coatings sector. Similarly, our expanded distributor base is generating a growing number of new customer engagements.
Our route to significant revenue is through providing our high-quality graphene nanoplatelets dispersed in a format ready to be incorporated into customer product formulations. We continue to work successfully with our customers on graphene integration through to product testing and product launches and we are now starting to see our customer base launch graphene-enhanced products on a larger scale. All of this progress is key to driving AGM’s sales growth, and it is particularly pleasing to see our customers in the coatings sector starting to use graphene-enhanced products in a range of large-scale, real-life applications, resulting in a developing pattern of repeat orders for our graphene products.
Having completed our recent fundraise, the Board considers AGM to be in good shape to develop our revenue prospects in the coming months.”
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.
Applied Graphene Materials’ results presentation, with audio commentary, is expected to be made available on its website at http://www.appliedgraphenematerials.com in due course.
