Invinity Energy Systems Plc · LSE:IES
Invinity Energy Systems — redT energy — H1 2018 Earnings Presentation
29 slides from Invinity Energy Systems's earnings presentation, September 2018
Slide 1: Interim Results 2018
Interim Results 2018 redT energy plc (AIM:RED) 1
Slide 2: Executive Summary
Executive Summary Energy storage to enable cheap baseload renewables Trusted energy storage expert with 20 years in the sector In-house proprietary flow machine technology Energy storage finance solutions across key sectors; C&I, Grid Storage, Large solar Gross pipeline £1.1bn, risked £188
Slide 3: Sector Opportunity
Sector Opportunity Macro trends in global energy and the role energy storage will play in our future energy system 3
Slide 4: The Future of Energy
The Future of Energy Distributed energy storage infrastructure is now open for business This is real, economic, distributed infrastructure Centralised Distributed Energy Type Levelised Cost (UK) Average cost of UK Electricity: Coal 13.7p – 17.1p / kWh 12p-14p/kWh (Centralised) Nuclear 8.5p – 12.3p /
Slide 5: A Changing Generation Mix
A Changing Generation Mix Source: Aurora Energy Research, 2018 More renewable (wind and solar) Movement towards ‘flexible’ capacity retirement of Coal and CCGT (Gas) 5
Slide 6: Solar + Storage: Tipping Point
Solar + Storage: Tipping Point Price of Energy Power Price Volatility Grid Service Revenues Tending to $0/kWh Peak Prices Rising USA, UK + others coming online Free abundance of energy Energy storage is enabling more renewables to come online Cheaper, cleaner energy, globally 6
Slide 7: Maximise Use of Cheap Renewables
Maximise Use of Cheap Renewables 1. Double cheap renewable generation 2. Average peak cost 12-14p 7
Slide 8: Stationary Energy Storage Market
Stationary Energy Storage Market GW Pumped Hydro 99% Li-ion Bespoke 1% New market driven by economics Projects Renewable + storage Freq. ( currently 0.1%) Power Resp MW Flow = pumped hydro in a box Small solar Grid Services (All) (<2 hours) Renewable Firming (4 hours – 24 hours) Back-up Network Rein
Slide 9: Company Update
Company Update redT energy – Key differentiators, technology and position within the sector 9
Slide 10: redT – Industrial Energy Storage
redT – Industrial Energy Storage Trusted - Energy storage solutions expert 20 years in energy storage. 100’s of client models Key clients; Technology - IP proven, patents, know how Solutions & Finance – infrastructure business models Energy storage machines and Lithium Low risk infrastructur
Slide 11: 2018 H1 Highlights & YTD
2018 H1 Highlights & YTD H1 2018 Delivery focus for existing Gen 2 orders Final stage of team build out – experienced, fully functioning teams H1 2018 average headcount: 70 (H1 2017: 24) Gen 3 product launched in June 2018 Best in class IP Embedded functionality to maximise customer retu
Slide 12: redT – Flow Machine Technology
redT – Flow Machine Technology Differentiation within the energy storage sector Pumped Hydro in a box - Doesn’t degrade High cost of degradation – Single application use Lowest Levelised cost, financeable, infrastructure asset High Levelised cost, requires regular replacement 25 year Cheap Power Reg
Slide 13: redT – Flow Machine Technology
redT – Flow Machine Technology Differentiation vs other flow machine technologies Gen 3 Technology with embedded functionality to enhance customer returns Pure Vanadium Redox Flow Machines Simple Durable Low-Risk Flexible Energy Infrastructure 13
Slide 14: Development Map
Development Map Development Commoditise Scale 1999 - 2014 2014-2017 2017-Present Stack technology proven Manufacturing commoditisation Functional, performing team Gen 3 launch (Margin product) – System prototyping & testing embedded functionality, improved power output, efficiency and Pr
Slide 15: Customer Segment Update
Customer Segment Update 15
Slide 16: Segment 1: Commercial BTM C&I
Segment 1: Commercial BTM C&I redT PV + Energy Storage Infrastructure Sector facts: Energy costs core to business (water sector 50% Upside more revenues of site costs) Low risk infrastructure investment Perform all services, remain flexible Pressure due to rising energy costs Flow Machines: Al
Slide 17: Segment 2: Grid Storage
Segment 2: Grid Storage Hybrid Lithium: 40MW, 40MWh Flow: 10MW, 50MWh Market Value: $bn’s – initial markets UK, Australia & Germany Sector Facts Sector Opportunity Grid assets subject to policy and market risk Flexible Diversified Asset for trading advantage Current market: bespoke, inflexible
Slide 18: Case Study: German Grid Storage
Case Study: German Grid Storage Initial project Further Phase 11MW, 44MWh – 800 redT units 2nd project identical to initial project 44MWh Both Projects - Extensions additional 22.5MW, 90MWh Third project - 150MW 600MWh Total investment ~€400m German SCR Market – Energy storage 2.0 4 hour
Slide 19: Segment Three: Solar/Wind + Storage
Segment Three: Solar/Wind + Storage Long duration Wind Solar energy storage (~6-10 hours) Baseload Energy (Now) < $90/MWh (Future) < $50/MWh Market Value: $bn’s – the future of distributed energy 2018 – marginally economic By 2021 – Solar cost reduction will drive this as major segment 19
Slide 20: Commercial Update
Commercial Update 20
Slide 21: Commercial Pipeline
Commercial Pipeline Deal Stage Gross Conversion Weighted Project £60m £57m 95% Development (1,776 units) (1,687 units) £198m £50m Quoted 25% (4,787 units) (1,197 units) Early stage £815m 10% £81m £1,073m £188m Core Segments 1 C&I BTM: £115m 2 Grid-Scale: £702m 3 Large Solar & Storage: £256m 21
Slide 22: HY 2018 Financials
HY 2018 Financials 22
Slide 23: Highlights
Highlights Revenue from continuing operations up 33% to £1.2m (H1 2017 £0.9m) Trading loss £5.4m (H1 2017: £2.8m loss) Operating loss from continuing operations £5.7m (H1 2017: loss £3.1m) Half year end free cash £3.9m (31 December 2017: £6.6m) Loans and borrowings £Nil (H1 2017: £Nil) P
Slide 24: Income Statement
Income Statement H1 18 H1 17 Movement FY 2017 £m £m £m % £m Continuing operations: Revenue 1.2 0.9 0.3 33 2.2 Cost of sales (0.4) - (0.4) n/a (0.3) Gross profit 0.8 0.9 (0.1) (15) 1.9 Administrative expenses (excl. SBP) (6.2) (3.7) (2.5) (66) (9.0) Trading loss (5.4) (2.8) (2.6) (92) (7.1) Share-bas
Slide 25: Segmental Analysis
Segmental Analysis redT Camco Group H1 18 H1 17 Movement H1 18 H1 17 Movement H1 18 H1 17 Movement £m £m £m % £m £m £m % £m £m £m % Continuing operations: Revenue 0.2 0.2 - 10 1.0 0.7 0.3 38 1.2 0.9 0.3 33 Cost of sales (0.2) - (0.2) n/a (0.2) - (0.2) n/a (0.4) - (0.4) n/a Gross profit - 0.2 (0.2) (
Slide 26: Cash flow
Cash flow H1 18 H1 17 Movem't FY 17 £m £m £m £m Loss for the year (5.8) (3.2) (2.6) (7.3) Add back: SBP 0.2 0.4 (0.2) 0.9 depreciation 0.2 - 0.2 0.2 FX movements 0.2 - 0.2 0.1 taxation - - - (0.1) Adjusted EBITDA (5.2) (2.8) (2.4) (6.2) Movement in: receivables 1.2 (0.3) 1.5 (1.8) inventory (1.2) -
Slide 27: Balance sheet
Balance sheet 30 June 18 31 Dec 17 Movement £m £m £m Property, plant and equipment 0.6 0.4 0.2 Intangible assets and goodwill 13.3 13.3 - Deferred tax assets 0.1 0.1 - Non-current assets 14.0 13.8 0.2 Inventory 1.8 0.6 1.2 Receivables 1.7 2.9 (1.2) Payables (1.4) (1.5) 0.1 Deferred income (1.6) (1.8
Slide 28: Appendix
Appendix 28
Slide 29: Management Team
Leadership * Also a member of the Board Scott McGregor* Jean-Louis Cols Chief Executive Officer Technology Director CEO since 2009, extensive experience within mining, Joined 2017 from Logan Energy, previously Group Management Team finance and technology industries Engineering Director at Intelligen