Source - LSE Regulatory
RNS Number : 6111L
Ilika plc
14 January 2021
 

 

Ilika plc

('Ilika,' the 'Company,' or the 'Group')

 

Half-year Report

 

Ilika (AIM: IKA), a pioneer in solid-state battery technology, announces its unaudited half yearly report for the six months ended 31 October 2020, during which the Company has continued to make strong progress with the implementation of its Stereax commercialisation plans, and set out a clear pathway to increased production, revenue generation and cash flow break even.

 

Operating Highlights

Ilika has continued to develop and commercialise its thin-film Stereax® miniature solid-state batteries for powering medical devices and industrial wireless sensors (IIoT) in hostile environments, as well as progressing its development of large-format Goliath cells for electric vehicles (EV) and cordless appliances.

 

·    Continued engagement with portfolio of Stereax customers from the IIoT and medical device sectors

·    Completion of an over-subscribed £15m ($20m) equity placing, providing working capital to support operations until the Company reaches cash flow break even

·    Signed a framework agreement with the UK Battery Industrialisation Centre (UKBIC) for the production of Goliath solid-state pouch cells, targeting growth production 1kWh per week to 5 MWh per week by 2024

·    Executed a portfolio of three collaborative projects supported by the UK Government's Faraday Battery Challenge, supported by £5.2m grant funding enabling work on rapid charging with Honda and Ricardo, battery packs for high performance vehicles with McLaren and cost-effective routes for the mass production of Goliath cells with JaguarLandRover

 

Financial Summary

·    Total revenue for the period £1.3m (H1 2019: £1.5m)

·    Loss per share 1p (H1 2019: 1p loss per share)

·    EBITDA loss £1.0m (H1 2019: £1.0m loss)

·    Cash balance at period end £12.4m (H1 2019: £1.9m)

 

Post Period end

·    Concluded its assessment of various Stereax manufacturing options, demonstrating that the most efficient and cost-effective solution will be to establish its own manufacturing operation

·    Confirmed that the key Stereax production tools, which are on order, are expected to be installed during May-July 2021, with manufacturing commencing after equipment and process qualification activities in the second half of 2021

This will result in a 70x increase in Stereax production capacity by the end of the 2021 calendar year

 

Commenting on the results Graeme Purdy, CEO of Ilika, said: "Despite unprecedented disruption to the Company's supply chain and operations in the first half of this financial year, we have continued to make strong progress with the implementation of our Stereax commercialisation plans. Although demand for Stereax is outstripping our current ability to supply from the pilot line, we are continuing to engage with customers to ensure we understand how demand can be extended, and ramped up further over the coming years. It has also been exciting to contribute to the relentless improvement in performance of our Goliath large format cells and to engage with the UK Battery Industrialisation Centre to plan their scale-up."

 

 

 

 

For more information contact:

 

Ilika plc

 

 

www.ilika.com

Graeme Purdy, Chief Executive

Via Walbrook PR

Steve Boydell, Finance Director

 

 

 

Liberum Capital Limited

Tel: 020 3100 2000

Andrew Godber, Cameron Duncan, William Hall, Nikhil Varghese

 

 

 

Walbrook PR Ltd

Tel: 020 7933 8780 / Ilika@walbrookpr.com

Tom Cooper

Mob: 0797 122 1972

Lianne Cawthorne

Mob: 07584 391 303

Nick Rome

Mob: 07748 325 236

 

Notes to editor and corporate video:

Please click link here to view latest corporate video and overview:

https://www.ilika.com/latest-news/ilika-investor-update-november-2020

 

Ilika plc (LON: IKA) is a pioneer in solid-state battery technology with their innovative Stereax micro batteries designed for Industrial IoT and MedTech markets, and their Goliath large format batteries for the electric vehicle and consumer electronics markets. Stereax battery technology offers compelling advantages over conventional lithium ion batteries, including smaller footprint, high energy density, non-toxic materials, faster charging, increased cycle life, low leakage and reduced flammability. Stereax solid-state batteries are also customisable in shape and form, stackable and operational at high temperatures.

 

 

 

Joint Chairman's and CEO's Statement

Review of Period

 

Principal Activities

Ilika has continued to pursue its strategy of developing and commercialising its cutting-edge solid-state batteries. The Company's mission is to rapidly develop leading-edge IP, manufacture and sell solid-state batteries for markets that cannot be addressed with conventional batteries due to their safety, charge rates, energy density and life limits. We will achieve this using ceramic-based lithium-ion technology that is inherently safe in manufacture and usage, which differentiates our products from existing batteries.

 

Introduction to solid-state battery technology

Ilika has been working with solid-state battery technology since 2008 and has developed a type of lithium-ion battery, which, instead of using liquid or polymer electrolyte, uses a ceramic ion conductor. Ilika's solid-state batteries have a number of benefits over traditional lithium-ion batteries, including the following:

·    Non-flammable, which eliminates the need for containment packaging

·    6 x faster charging

·    2x increased energy density, making them half the volume and weight for a given electrical charge

·    10x longer storage without loss of charge.

 

Ilika has developed a roadmap and family of battery products, ranging from miniature solid-state devices designed for powering wireless sensor applications and medical devices to large format cells for automotive power.

 

Miniature Stereax batteries

Ilika's miniature Stereax cells are differentiated from other solid-state technology through its choice of materials and its use of an efficient, low temperature evaporation process that is capable of higher manufacturing rates than other existing solid-state routes. This results in the following benefits relative to previous solid-state battery designs:

·    Lower cost of manufacture through avoiding use of expensive sputtering targets

·    Long cycle life through use of a silicon anode

·    Less encapsulation required

·    High temperature resilience

 

The unique benefits of Stereax batteries make them particularly useful for medical implants and industrial applications. Miniature Stereax batteries can enable medical devices in a way that is currently not possible with conventional lithium-ion batteries. Their compact, high energy density, high power characteristics make them useful for a range of medical implant applications covering blood pressure monitoring to neuro-stimulation. Industrial automation, or Industrial Internet of Things (IIoT) as it is sometimes referred to, requires low maintenance batteries with a long lifetime, sometimes in situations that require them to operate at elevated temperatures above those for which standard lithium-ion batteries are rated (typically 60 degC).

 

Stereax® Manufacturing Scale-up and Commercialisation

Ilika is currently manufacturing Stereax® batteries on a pilot line. These batteries are being continuously improved for further enhancement of their properties, and also sold for customer evaluation. Increasing commercial demand for evaluation samples from our growing portfolio of customers continues to place pressure on the utilisation of the Stereax pilot line. The ramping demand for Stereax batteries underpinned an over-subscribed £15m ($20m) equity placing, which the Company concluded in March 2020, in order to support the transfer of Stereax to a manufacturing facility, strengthen the balance sheet to meet working capital requirements and provide the option for investing in further growth in Stereax production capability, including implementing a dual source production capability in the future.

 

In November 2020, the Company concluded its assessment of various Stereax manufacturing options, which included manufacturing wafers of Stereax batteries at 3rd party facilities as an alternative to establishing its own manufacturing operations. Having fully compared the benefits and risks of installing the key equipment needed for Stereax production in different locations around the world, the Company demonstrated that the most efficient and cost-effective solution will be to establish its own manufacturing operation. We have identified a suitable facility within 5 miles of our headquarters and the lease is currently being finalised.

 

The key Stereax production tools, which are on order, are expected to be installed during May-July 2021, with manufacturing commencing after equipment and process qualification activities in the second half of 2021. This will result in a 70x increase in Stereax production capacity by the end of the 2021 calendar year.

 

Once the technology transfer into its manufacturing facility has been achieved, Ilika's business model will continue to be to sell batteries, although some parts of the manufacturing workflow will be managed on an outsourced basis. A further step-up in production capacity with a larger manufacturing partner is expected to be required further into the future, when a licensing model may be more appropriate.

 

Large Format Goliath batteries

In September 2019, Ilika announced the opening of its new large format battery facility, the Goliath pilot line, in Romsey, UK to support its portfolio of industrial collaborations. On this pilot line, Ilika is developing low-cost printing processes suitable for forming batteries several orders of magnitude larger than miniature Stereax batteries.

 

In the first half of this year, Ilika has been executing a portfolio of three collaborative projects supported by the UK Government's Faraday Battery Challenge. The projects are supported by £5.2m grant funding enabling work on rapid charging with Honda and Ricardo, battery packs for high performance vehicles with McLaren and cost-effective routes for the mass production of Goliath cells with JaguarLandRover. Ilika is also engaging with manufacturers of cordless appliances, e.g. vacuum cleaners and beauty products, which can also benefit from some of the unique properties of solid-state batteries.

 

Goliath Manufacturing Scale-up

The Company's pilot line in Romsey is capable of producing 1kWh per week. Ilika has plans to scale up its current site to an automated facility producing 10 kWh per week by 2022. In September 2020, Ilika announced the signing of a framework agreement with the UK Battery Industrialisation Centre (UKBIC) for the production of Goliath solid state pouch cells. This stage of scale-up will involve Ilika reaching 5 MWh per week by 2024 to satisfy increasing customer demand. The signing of the framework agreement with UKBIC is a significant and important step towards achieving that goal. Discussions with the UK Government's Faraday Battery Challenge are on-going regarding further grant funding to support the planned scale-up activities.

 

Outlook

Ilika has an intensive period of operational implementation ahead of it for the remainder of this financial year and into next year as it deploys the capital it raised in March 2020 to establish a manufacturing facility for Stereax. The technical maturity of Goliath is expected to continue to rise as prototype cell performance continuously improves. These activities will provide a strong platform for renewed revenue growth in the next financial year.

 

 

Graeme Purdy, CEO

Keith Jackson, Chairman

Ilika plc
 

Consolidated statement of comprehensive income for the six months ended 31 October 2020

 

 

 

Unaudited

 Six months ended

31 Oct 2020

Unaudited

 Six months ended

31 Oct 2019

Audited

Year

ended

30 Apr 2020

 

Notes

£

£

£

 

 

 

 

 

Turnover

 

1,250,249

1,460,639

2,840,648

Revenue

 

83,253

212,823

367,003

UK grants

 

1,166,996

1,247,816

2,473,645

 

 

 

 

 

Cost of sales

 

(705,045)

(782,115)

(1,571,350)

 

 

 

 

 

Gross profit

 

545,204 

678,524 

1,269,298 

Administrative expenses

 

 

 

 

Administrative expenses

 

(2,136,592)

(2,132,354)

(4,380,259)

Share-based payment charge

 

(163,787)

(119,348)

(233,786)

 

 

(2,300,379)

(2,251,702)

(4,614,045)

 

 

 

 

 

Operating loss

 

(1,755,175)

(1,573,178)

(3,344,747)

 

 

 

 

 

Financial income

 

9,032 

8,386 

12,406 

Financial expense

 

(4,000)

(6,432)

(10,299)

 

 

 

 

 

Loss before tax

 

(1,750,143)

(1,571,224)

(3,342,640)

Taxation

 

128,962 

139,734 

254,734 

 

 

 

 

 

Loss for period/total comprehensive income attributable to owners of parent

 

 

(1,621,181)

 

(1,431,490)

 

(3,087,906)

 

 

 

 

 

Loss per share

 

 

 

 

Basic and diluted

2

(0.01)

(0.01)

(0.03)

 

The results from the periods shown above are derived entirely from continuing operations.

 

Consolidated balance sheet as at 31 October 2020

 

 

 

Unaudited

Six months ended

31 Oct 2020

Unaudited

Six months ended

31 Oct 2019

Audited

Year

ended

30 Apr 2020

 

Notes

£

£

£

ASSETS

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets

 

467,166

21,466 

66,110 

Property, plant and equipment

 

2,043,105

2,186,502 

1,670,614

Right-of-use assets

 

208,034

240,040

 

 

 

 

 

Total non-current assets

 

2,718,305

2,207,968 

1,976,764

 

 

 

 

 

Current assets

 

 

 

 

Trade and other receivables

 

1,809,990

1,520,349

1,470,664

Current tax receivable

 

428,962

499,734

300,000

Other financial assets - bank deposits

 

765,696

353,831

762,200

Cash and cash equivalents

 

11,661,566

1,507,631

13,989,538

 

 

 

 

 

Total current assets

 

14,666,214

3,881,545

16,522,402

 

 

 

 

 

Total assets

 

17,384,519

6,089,513

18,489,166

 

 

 

 

 

Issued capital and reserves attributable to owners of parent

 

 

 

Issued share capital

 

1,391,857 

1,013,670 

1,391,857 

Share premium

 

40,895,709 

27,103,356 

40,895,709 

Capital restructuring reserve

 

6,486,077 

6,486,077 

6,486,077 

Retained earnings

 

(33,037,944)

(30,043,689)

(31,580,550)

 

 

 

 

 

Total equity

 

15,735,699

4,559,414 

17,193,093

 

 

 

 

 

LIABILITIES

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

 

1,316,616

1,240,099

910,301

Lease liabilities

 

68,875

-

68,875

 

 

 

 

 

Total current liabilities

 

1,385,491

1,240,099

979,176

 

 

 

 

 

Non-current liabilities

 

 

 

 

Lease liabilities

 

122,964

-

157,227

Provisions

 

140,365

290,000

169,670

 

 

 

 

 

Total non-current liabilities

 

263,329

290,000

326,897

 

 

 

 

 

Total liabilities

 

1,648,820

1,530,099

1,306,073

 

 

 

 

 

Total equity and liabilities

 

17,384,519

6,089,513

18,489,166

 

Consolidated cash flow statement for the six months ended 31 October 2020

 

 

Unaudited

Six months ended

31 Oct 2020

Unaudited

Six months ended

31 Oct 2019

Audited

Year

ended

30 Apr 2020

 

£

£

£

Cash flows from operating activities

 

 

 

Loss before taxation

(1,750,143)

(1,571,224)

(3,342,640)

Adjustments for:

 

 

 

Amortisation

6,697 

5,566 

11,700 

Depreciation

551,605 

464,349 

1,035,907 

Equity settled share-based payments

163,787 

119,348 

233,786 

Loss on disposal of plant, property and equipment

1,557 

-

3,552 

Net financial income

(5,032)

(1,954)

(2,107)

Operating cash flow before changes in working capital, interest and taxes

(1,031,529)

(983,915)

(2,059,802)

Decrease/(increase) in trade and other

receivables

 

(339,326)

 

3,514 

 

60,036 

Increase /(decrease) in trade and other payables

406,315 

(458,907)

(256,844)

Decrease in provisions

(29,304)

(120,330)

Cash utilised by operations

(993,844)

(1,439,309)

(2,376,940)

Tax received

-

314,734 

Net cash flow from operating activities

(993,844)

(1,439,309)

(2,062,206)

 

 

 

 

Cash flows from investing activities

 

 

 

Interest received

9,033 

8,386 

12,406 

Purchase of intangible assets

(407,753)

(3,217)

(53,995)

Purchase of property, plant and equipment

(893,649)

(617,917)

(1,202,855)

Sale of property, plant and equipment

- 

-

12,595 

Increase in other financial assets

(3,496)

(1,867)

(410,237)

Net cash used in investing activities

(1,295,865)

(614,614)

(1,642,086)

 

 

 

 

Cash flows from financing activities

 

 

 

Proceeds from issuance of ordinary share capital

600 

15,105,525 

Cost of share issue

-

(934,385)

Capital element of finance leases repaid

(38,263)

(38,262)

(76,526)

Net cash from financing activities

(38,263)

(37,662)

14,094,614 

 

 

 

 

Net (decrease)/ increase in cash and cash equivalents

(2,327,972)

(2,091,585)

10,390,322

 

 

 

 

Cash and cash equivalents at the start of the period

13,989,538 

3,599,216 

3,599,216 

 

 

 

 

Cash and cash equivalents at the end of the period

11,661,566 

1,507,631 

13,989,538 

 

 

Consolidated statement of changes in equity (unaudited)

 

 

 

Share capital

Share premium account

Capital

restructuring reserve

 

Retained earnings

 

 

Total

 

£

£

£

£

£

As at 30th April 2019

1,013,070

27,103,356 

6,486,077

(28,725,856)

5,876,647 

Adjustment in respect of

adoption of IFRS 16

-

-

-

(5,691)

(5,691)

As at 30th April 2019 (restated)

1,013,070

27,103,356 

6,486,077

(28,731,547)

5,871,556  

Issue of shares

600 

-

-

600 

Share-based payment

-

-

-

119,348

119,348 

Loss and total

comprehensive income

-

-

-

(1,431,490)

(1,431,490)

As at 31 October 2019

1,013,670

27,103,356 

6,486,077

(30,043,689)

4,559,414 

Issue of shares

378,187

14,726,738 

-

-

15,104,925 

Cost of share issue

-

(934,385)

-

-

(934,385)

Share-based payment

-

-

-

114,438

114,438 

Loss and total

comprehensive income

-

-

-

(1,651,299)

(1,651,299)

As at 30th April 2020

1,391,857

40,895,709

6,486,077

(31,580,550)

17,193,093 

Share-based payment

-

-

-

163,787 

163,787 

Loss and total

comprehensive income

-

-

-

(1,621,181)

(1,621,181)

As at 31 October 2020

1,391,857

40,895,709

6,486,077

(33,037,944)

15,735,699 

 

Share capital

The share capital represents the nominal value of the equity shares in issue.

 

Share premium account

When shares are issued, any premium paid above the nominal value is credited to the share premium reserve.

 

Retained earnings

The retained earnings reserve records the accumulated profits and losses of the Group since inception of the business.

 

Capital restructuring reserve

The capital restructuring reserve arises on the accounting for the share for share exchange.  It represents the difference between the value of the issued equity instruments of Ilika Technologies Limited immediately before the share for share exchange and the equity instruments of Ilika plc along with the shares issued to effect the share for share exchange.

 

Notes to the consolidated financial statements

 

 

Basis of preparation

 

The interim financial statements, which are unaudited, have been prepared on the basis of accounting policies consistent with International Financial Reporting Standards ("IFRSs") adopted by the European Union. The accounting policies are the same as applied in the Group's latest financial statements.

 

The interim financial statements do not include all of the information required for full annual financial statements and do not comply with all the disclosures in IAS 34 'Interim Financial Reporting'. Accordingly, whilst the interim financial statements have been prepared in accordance with IFRS they cannot be construed as being in full compliance with IFRS.

 

The financial information for the year ended 30 April 2020 does not constitute the full statutory accounts for that period. The Annual Report and Accounts for 30 April 2020 have been filed with the Registrar of Companies. The Independent Auditors' Report on the Annual Report and Accounts for 2020 was unqualified and did not include references to any matters which the auditors drew attention by way of emphasis without qualifying their report and did not contain statements under Section 498(2) or 498(3) of the Companies Act 2006.

 

Going concern

 

The financial statements are prepared on a going concern basis which the directors believe continues to be appropriate. The Group meets its day to day working capital requirements through existing cash resources which, at 31 October 2020, amounted to £12.4m. The directors have prepared projected cash flow information for the period ending twelve months from the date of their approval of these financial statements. On the basis of this cash flow information the directors believe that the Group will be able to continue to trade for the foreseeable future.

 

 

 

Loss per ordinary share have been calculated using the weighted average number of shares in issue during the relevant financial periods. The weighted average number of equity shares in issue and the earnings, being loss after tax, are as follows:

 

 

Unaudited

Six months ended

31 Oct 2020

 

Unaudited

Six months ended

31 Oct 2019

 

Audited

Year

ended

30 Apr 2020

 

Number

Number

Number

 

 

 

 

Weighted average number of equity shares

139,185,712

101,321,426

104,645,940

 

 

 

 

 

£

£

£

 

 

 

 

Loss, being loss after tax

(1,621,181)

(1,431,490)

(3,087,906)

 

 

 

 

 

The loss attributable to ordinary shareholders and weighted average number of ordinary shares for the purpose of calculating the diluted earnings per ordinary share are identical to those used for basic earnings per share. This is because the exercise of share options and warrants would have the effect of reducing the loss per ordinary share and is therefore not dilutive under the terms of IAS 33.

 

 

 

 

 

- Ends -

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
IR DXLFFFFLBBBZ
Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account.