Ceres Power jumps after more than doubling revenue

28th Mar 2019 12:36

(Sharecast News) - Ceres Power's shares climbed on Thursday after the company said it had slashed its interim losses as revenues more than doubled on the back of new licence fees.The fuel cell technology developer recorded a loss before tax of £2.8m for the six-month period ended 31 December, a drop of 54% compared to the same period the year before, after revenue jumped 168% to £8.3m.Of those sales, £5.1m stemmed from new licenses, with revenues from customers comprising over 95% of income, with revenue from engineering services, through joint development agreements and the provision of hardware to a mix of customers, grew 14% in the period to £3.0m.Phil Caldwell, chief executive of Ceres Power, said: "This has been another period of significant commercial and financial progress. Our Licence Agreements with both Robert Bosch and Weichai were key milestones and validate our strategy to secure initial license fees with major global OEM partners, with a view to generating royalties once products are launched. Both of these partnerships have the potential to transform Ceres and step change the scale of our business."The AIM traded company also said its strong order book of £30.5m means that it remains on course to double revenue for a fourth successive year."We enter the second half of the year with a strong cash position, having successfully raised £78m in 2018, and good momentum thanks to the growing awareness of the role that fuel cells can play in the future energy mix. The interest in our technology and the wide-ranging applications it has in power, transport and heating is now gaining real traction. We are well placed to deliver on our growth potential," said Caldwell.A note from analysts at Berenberg said the interim results demonstrated "further commercial, financial and operational progress", leaving management "rightly" upbeat."The company is now comfortably funded through to profitability (c£78m net cash on the balance sheet), key partnerships with Weichai Power and Bosch are progressing to plan and the order book is growing. We are becoming incrementally positive on the medium-term opportunity and believe there is a scenario where Ceres generates £30m of EBIT by 2025 as the business shifts towards a high-margin, licensing model," the analysts added.Ceres Power's shares were up 6.78% at 147.35p at 1306 GMT.