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Ceres Power Holdings shares dip as rising revenues fail to impact loss
Ceres Power Holdings suffered a 10% decrease in share prices on Tuesday after the company reported an unchanged total loss for the six months preceding 31 December despite rising revenues.
The AIM traded fuel cell technology company saw a 156% increase in revenues to £2.6m for the period compared to the same period in 2016, with this being offset by a 249% increase in cost of sales to £1.4m and a 6% increase in operating costs up to £7.8m.
The company stated that its operating costs stem from the employment of specialists which it said enhances the group's "operations quality and manufacturing throughput capabilities".
Operating loss is expected to remain flat as the company intends to invest funds from customer programmes into the growth of the business via increasing manufacturing capacity.
Phil Caldwell, chief executive of Ceres Power, said: "We continue to hit our targets with five world class partners now in place and more in the pipeline. We are building momentum with strong revenue growth from new and existing partners. We expect this trend to continue for the full year and beyond."
The company's five partners include Cummins, Honda and Nissan, as well as a "major European manufacturer" which became a partner during the period.
As of 31 December, Ceres had net cash and short term investments of £13.2m which it would use for the necessary investment in the aforementioned manufacturing expansion, alongside potential assistance from an expected strategic partner which was expected to sign in 2018 and launch the company's SteelCell technology.
The new manufacturing site is intended to commence at 1MW annual production, ramping up in phases to 10MW to match customer demand.
"As we approach commercialisation we are positioning the business for future growth through investment in our core technology and additional manufacturing capacity. These are essential steps in scaling the business to meet the high standards required by our partners through early stage volumes while also maintaining our technology leadership position," said Caldwell.
As of 1604 GMT, Ceres Power Holdings' shares were down 10.71% at 11.25p.