Ilika CEO Graeme Purdy on Cash position, SiSTEM project, and Goliath milestones (LON:IKA)

Ilika plc (LON:IKA) Chief Executive Officer Graeme Purdy caught up with DirectorsTalk for an exclusive interview to discuss their cash position, key takeaways from the Capital Markets Day, objectives of the SiSTEM project, the agreement with Agratas, and the next milestones for the Goliath project.

Q1: Now Graeme, you recently issued a positive trading update. Is it fair to say that Ilika’s cash position is ahead of analysts’ expectations?

A1: Yes, I think that’s true. The expectation was that we would finish the year with a healthy cash balance, and we have done that. We expect to have £11 million when our financial year ends on the 30th of April and in addition, I think that’s probably been created by better-than-expected revenue generation.

So, the revenue for this year has been about £2 million, up from about £0.8 million last year, largely due to better grant support for our programmes. The cash position has also been aided by some of the cost reductions we were able to drive through our partnering agreement with Cirtec in relation to our Stereax manufacturing scale-up.

Q2: Your Capital Markets Day on the 23rd of April, it was well attended, but what were the principal takeaways?

A2: That’s right, it was very well attended, we had about 50 attendees from across the city, so investors and analysts.

I think the key takeaways, first of all, for Stereax, there was an update from Cirtec, from Brad Womble, who’s their senior strategist and business developer there. Brad was very bullish about the market opportunity for Stereax, addressing the big demand for smart, active implants in the medical sector. There was also an update on the state of readiness of the installation of the equipment that we’ve sent across in order to support the initial production of Stereax.

On the Goliath side, of course, we recapped some of the great technical milestones that we’ve hit at the end of 2023, our D4 development milestone, and then moving into lithium-ion energy density parity, and a view of the road ahead.

Q3: Now, you just announced that Agratas has joined the APC-funded system project. Could you just remind us of the objectives of the project, and what Agratas expects to get out of it?

A3: So, a couple of days after the Capital Markets Day, we announced that Agratas had joined the system project.

So, the SiSTEM project is supported by the Automotive Transformation Fund, so managed by the APC, or the Advanced Propulsion Centre here in the UK, and the objectives of the SiSTEM are to build a 1.5 megawatt-hour solid-state battery assembly line. We’re doing that together with a company called Mpac, which is also an AIM-listed company, to deliver the Goliath solid-state battery large format pouch cells. We’re also going to undertake some scale-up trials at the UK Battery Industrialisation Centre, so UKBIG.

In terms of what Agratas expects to get out of it, well, they’ve joined the programme to undertake an evaluation of the scale-up requirements for our Goliath technology, including a concept facility design for the implementation of Goliath at gigafactory scale.

Q4: In parallel, though, Agratas and Ilika have entered into a collaboration agreement, what will that entail?

A4: It’s a 12-month agreement that will facilitate interactions between Agratas and the group to support our journey through to what we’ve called our D8 milestone, which is a 50-amp-hour chemistry frozen development milestone we expect to hit in the first half of next year, 2025.

In addition, we’ll be exploring wider collaboration opportunities between the two parties.

Q5: Finally, what are the next Goliath milestones that we should look out for?

A5: It’s going to be an exciting time for Goliath as we move forward.

We expect to start testing our first batch of P1 prototypes shortly, as we trailed when we announced the D4 development point so the D4 development point is effectively the design freeze for the P1 prototypes. So, our P1 prototypes are the first prototypes that we’ll be sharing with our evaluation partners so they’ll be going out of the door for that evaluation shortly. We’ll also be forging forward with our next development points, D5 through to D8.

So there will be a regular update on the steady improvement and increasing scale of our Goliath batteries.

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