Haydale Graphene Industries PLC (LON:HAYD) Chief Executive Officer Ray Gibbs caught up with DirectorsTalk to discuss their preliminary results, recent major capex, meaningful revenues and when they will become profitable
Q1: Ray, final results out today, turnover was up 30% but losses also up by the same percentage, why is this?
A1: Well there’s good reasons for that. We’ve invested for the future here, we’ve spent about £1 million on research and development for our future products, that’s up £500,000 from the last year, we’ve invested again in some quality staff, we’ve moved from 32 to 46, as we’re building again for the sales and marketing expansion plans that we’ve got and we’ve announced today.
Q2: Now you’ve spent almost £500,000 on reactors in the last year which follows on from the £1.18 million in the prior year, is this the end of Haydale’s major capex on reactors?
A2: We need to put a reactor into Thailand, we’ve announced the acquisition a while back, a couple of months back, of Innophene in Thailand, we want to have one over there so we will be spending a bit in that area, of course having just announced the acquisition of ACMC in the States we are also going to put a reactor over there in 2017. So we will continue to do that in our strategic locations to service the marketplace for which they’re heavily involved with.
Q3: We’ve seen a number of collaborations over the year and another acquisition this morning following on from your Thailand deal recently, I guess investors really want to know when will all this generate meaningful revenues?
A3: Well the acquisition in the United States is a revenue generating business, its turnover last year to December 2015 was $3.8 million, it’s profitable, it has a synergistic product for us, silicon carbide, and we’ve got lots of opportunities to cross-sell that into our marketplace and our own customer base. We’re looking for them to grow quite quickly, there’s a high margin in the business, the base material for which they use to create the silicon carbide comes from rice husks which are very cheap in the market. Looking for lots of things to happen there and yes the meaningful revenues will be coming.
Q4: So with that in mind then, when do you think Haydale Graphene Industries will be profitable?
A4: The marketplace has us in for next fiscal year to achieve breakeven and we think we’re going to get there, we don’t see any reason why we shouldn’t get there. As I say, this business is now transitioning, we have been doing for a while, we’re on this transitional path to take our research and development efforts and put them into meaningful sales and marketing. In that respect, we’ve announced at the same time this launch of our 3D graphene PLA, that’s polylactic acid which is a 3D printing material which when we’re adding graphene it producing some quite stunning results and we’re launching that at the end of this month in the TCT Show in Birmingham and talk about instant revenue, we think we’ll be selling those quite quickly and feedback from the marketplace is very strong.
