EQS Group-Ad-hoc: Leclanché SA / Key word(s): Annual Results
Leclanché announces its full year 2019 financial results and provides key financial updates
Strategic Reorganization underway, in partnership with Eneris Group, sets a clear path to deliver profitable growth
- Audited results in line with the unaudited results published on 18th May 2020;
- Strong support from Company's largest shareholder FEFAM through a commitment to convert CHF 50.9 million of its debt into Equity;
- Fully funded business plan thanks to the Loan Agreement with Eneris Group for up to CHF 43 million for working capital;
- Worldwide business wins with combined order book exceeding CHF 90 million for delivery over years 2020 to 2021- excluding the St. Kitts project;
- Build-Own-Operate (BOO) model for St. Kitts project shall add profitable growth for 20 years and further strengthen the assets in the balance sheet of the Company.
Anil Srivastava, CEO of Leclanché said: "We thank our largest shareholder FEFAM for confirming its commitment to convert CHF 50.9 million of its debt into equity well-before the maturity in December 2021. It allows the Company to save significant cash from interest payments and materially strengthens its balance sheet.
To launch the highly profitable Build-Own-Operate ("BOO") business line, the St. Kitts project has been moved from a traditional turnkey EPC contract to BOO model. While Leclanché will still build the project as an EPC contractor, there will not be any revenue recognition as an EPC contractor under the BOO model. This accounting requirement will lead to a reduction of more than CHF 55 million revenue in 2020. This technical shift shall be more than offset with an average revenue recognition of circa CHF 9 million per year and a positive EBITDA of more than CHF 5 million per year for a period of 20 years under the signed Power Purchase Agreement with SKELEC, St. Kitt's Electrical Utility. Other projects will follow each year adding recurrent positive EBITDA."
Consolidated revenues for fiscal year 2019 were CHF 16.3 million, down from CHF 48.7 million in 2018; the EBITDA loss for the year amounts to CHF (67.9) compared to a loss of CHF (39.1) million the previous year; the net loss for the year was CHF (83.4) million compared to CHF (50.7) million in 2018.
The decrease in revenues in 2019 is mainly due to (i) delays in funding of the St. Kitts and Nevis project, (ii) delays in the financing of growth capital, which affected the completion of several projects and investments in an increase in production capacity at Leclanché's cell facility in Willstätt, Germany. The above-mentioned reasons had a negative impact on 2019 revenues of approximately CHF 50 million.
The balance sheet total amounted to CHF 73.1 million compared to CHF 87.3 million in 2018, this decline stemming essentially from a reduction in other receivables, contracts assets and cash and cash equivalents. In addition, Leclanché SA, the Swiss legal entity, was in a negative equity situation as of December 31st, 2019 in the amount of CHF 2.1 million. Leclanché addressed this over-indebtedness situation by obtaining a subordination of CHF 29.8 million of the debt provided by FEFAM , Leclanché's majority shareholder, which has subsequently committed to convert into equity CHF 50.9 million of the same debt.
Anil Srivastava, CEO of Leclanché said: " We thank all our shareholders for their significant and patient investments since late 2006 in developing our Energy Storage Business based on in-house Lithium Cells and Systems.
The economic uncertainties remain high because of the COVID-19 virus. While following the local health advisories in all countries we operate, we had to reduce the production for the past few months. Thus far, we have not had any order postponement or cancellation. We shall take all prudent measures as the situation evolves."
Notwithstanding the challenges due to Covid-19, we are confident that the Company is on a clear path to deliver sustainable profitable growth thanks to:
- The access to nearly 1 GWh capacity planned in Germany by Q1 2022 and a further 1.4 GWh by end-2024 in Poland from the recently announced partnership agreement with Eneris Group;
- With the introduction of the new G-NMC 60Ah cells, 210 Wh/kg and 420 Wh/liter, in production from April of this year, Leclanché has secured its position among the best in the industry in terms of energy density and cycle lifetime. These new cells, combined with next-generation M3 Modules to be operational in early 2021, results in the cost per kWh being reduced by more than 25% over 2018-2019 pricing levels. With three shifts of continuous production planned in Q4 2020, the Company is set to deliver positive Gross Margin in its eTransport business.
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SIX Swiss Exchange: ticker symbol LECN | ISIN CH 011 030 311 9
 FEFAM means: AM INVESTMENT SCA, SICAV-SIF - Illiquid Assets Sub-Fund, together with FINEXIS EQUITY FUND - Renewable Energy Sub-Fund, FINEXIS EQUITY FUND - Multi Asset Strategy Sub-Fund, FINEXIS EQUITY FUND - E Money Strategies Sub-Fund (also called Energy Storage Invest) and, all these funds being in aggregate the main shareholder of Leclanché, hereunder referred to as "FEFAM".
End of ad hoc announcement
|Av. des Sports 42|
|Phone:||+41 (24) 424 65-00|
|Fax:||+41 (24) 424 65-20|
|Listed:||SIX Swiss Exchange|
|EQS News ID:||1063695|
|End of Announcement||EQS Group News Service|
1063695 05-Jun-2020 CET/CEST