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17 Feb 2021 | 08:39

Ceres Power trades well through end of 2020

(Sharecast News) - Fuel cell technology company Ceres Power updated the market on its trading on Wednesday, reporting that revenue and other operating income for the 18 months ended 31 December would be above market expectations at around £32m to £33m. The AIM-traded firm said its order book and pipeline totalled £54m and £44m respectively on 31 December, compared to £22m and £50m a year earlier.

Cash and short-term investments were around £110m at the end of 2020, which was higher than expected as a result of positive working capital movements.

On the strategic front, the board noted that Doosan signed a manufacturing licence with a target capacity of 50MW in 2024, and also extended its systems partnership with Ceres to target higher power utility scale applications.

Bosch also strengthened its partnership with Ceres, having passed a key development milestone in December.

It was now preparing to scale up to mass manufacture and targeting production capacity of 200MW in 2024.

Weichai was continuing its bus trials using Ceres' 'SteelCell', due to complete in the first half of 2021, as a "key step" towards establishing a joint venture between Weichai and Ceres in China in mid-2021.

Ceres and engineering consultancy AVL List also signed a strategic collaboration to accelerate systems licensing, providing "global reach" to Ceres, leveraging the respective fuel cell systems intellectual property, resources and capability, and drive demand for stack manufacturing licensees, the company explained.

Looking ahead, Ceres said its focus remained on supporting its manufacturing partners in scaling up their production capabilities towards mass market launches in 2024, which would trigger royalty payments to the firm.

Ceres and Weichai were intending to establish a joint venture in the middle of the year, following the successful conclusion of the bus trial.

The company said it also planned to continue the development of solid oxide electrolysis for green hydrogen production targeting industrial applications, following successful initial research and development.

"The last 18 months have been one of the most important periods in our history," said chief executive officer Phil Caldwell.

"Bosch and Weichai made significant equity investments in the business, underlining their long-term confidence in our technology.

"On the supply side of our SteelCell ecosystem we announced the scale up to an aggregate 250MW of manufacturing capacity for 2024, giving us visibility of high margin royalty revenues."

Caldwell said that was balanced on the original equipment manufacturer (OEM) systems side with the AVL relationship, which he said should accelerate Ceres' systems licensing opportunities and create additional fuel cell stack demand for its manufacturing partners.

At 0819 GMT, shares in Ceres Power Holdings were down 1.26% at 1,469.22p.
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