21 September 2016
Intelligent Energy Holdings plc
Intelligent Energy ('IE' or the 'Company'), the energy technology group, provides the following trading update.
Headline financial metrics for the year ending 30 September 2016:
• Revenue is expected to be over £90m (FY 14/15 £78m)
• Adjusted EBITDA (1) is expected to be c£(35)m (FY 14/15 £(46)m), reflecting the Group's larger costs base prior to the recent restructuring
• Cash balance at 30 September 2016 is expected to be over £20m
Business restructuring update
The business restructuring programme announced on 4th April 2016 has now been broadly completed.
This currently places the business, excluding the operations in India, with the following underlying financial profile on an estimated exit run rate basis:
• Adjusted EBITDA (1), c£(1.1)m a month
• Cash burn, adjusted EBITDA (1) - capex, c£(1.3)m a month
• Cash burn, adjusted EBITDA (1) - capex - interest c£(1.6)m a month on average
• H1 balance sheet non cash impairments of £45.8m of which £21.9m relates to deferred tax
• H2 Cash restructuring costs of c£2.5m, c£0.5m to follow in 2016/17
Post restructuring, the core UK business is now focused on Air Cooled (AC) fuel cell commercial opportunities with a power requirement of sub 1W to 20kW. It is the intention to seek to grow the business from the restructured base in FY 16/17, and to reduce cash burn from the current run rates, over the course of the forthcoming financial year. Based on its current visibility, the Company expects to exit the financial year ending 30 September 2017 with net cash on its balance sheet.
Update on the GTL transaction in India:
• GTL transaction relates to the supply of c27,000 telecoms sites in India under long term contracts
• Currently IE is working under an interim agreement with GTL, which represents an exit run rate of c£7 million a month of revenue with minimal margin
• IE continues in its discussions to secure separate financing for the consummation of the long term GTL contracts and transaction
• There is no guarantee that the transaction will be completed
• Discussions are also ongoing in relation to a separate supply agreement for fuel cell deployment
• Should the transaction complete then IE would have a minority position in the equity of the venture
The core business outlook above is not materially dependent on the completion of the GTL transaction.
Update on Group strategy:
For more information relating to the Group strategy please refer to the Strategy Update RNS issued this morning.
(1) EBITDA is a non-statutory measure often used by investors as a proxy for cash and to calculate the value of a business. The Company uses adjusted EBITDA (Earnings before Interest, Impairment Charges, Tax, Depreciation, Amortisation, share of joint venture results, equity fund raising costs and IFRS2 share-based payment charges) as an indicator of trading profitability and a proxy for operating cash flow, before any cash movements relating to investment, tax, funding and changes in working capital. It is not an IFRS measure, and not therefore shown in the Group income statement.
This announcement contains inside information.
Intelligent Energy Holdings plc
Martin Bloom, Group Chief Executive Officer
John Maguire, Chief Financial Officer
+44(0) 1509 271 271
Stifel Nicolaus Europe Limited
+44(0) 207 710 7600
James Macey White
+44(0) 207 353 4200
This information is provided by RNS