Acta Power System Summary and Outlook 28 January 2014

RNS Number : 6300Y

Acta S.p.A.

28 January 2014

 
 Press release   28 January 2014 
 

Acta S.p.A.

("Acta" or "the Company")

Trading and business update

Acta S.p.A. (AIM: ACTA), the clean energy products company, announces a trading and business update ahead of the publication of its results for the year ended 31 December 2013.

Current Trading

-- Rapid development in customer trials for the Acta Power system with strong levels of commercial interest

-- Five Acta Power units sold: two tested, approved and installed on live sites for final evaluation, two tested and approved with live site evaluation due to commence shortly and one being used for demonstration purposes

-- CE Certification for the Acta Power secured ahead of year-end, in readiness for commercial roll-out

-- Larger "network evaluations" of the Acta Power system are currently under negotiation. Initial network installations are expected to be typically of 50 to 150 units per customer network with up to 50 units in the first call-down

-- Based on the timing indications received from Acta's partners, it is anticipated that the first telco approved product certifications for the Acta Power will be granted early in the second quarter of 2014, with network evaluation contracts to follow shortly thereafter

-- Further expansion of Acta's production facility underway targeting capacity of 40 Acta Power units per month for H2 2014

-- 2013 revenue is expected to be in excess of EUR400,000, well ahead of comparable revenues from products and research services in 2012 (EUR233,000), despite slower than forecast sales conversions

-- Expected operating loss in the region of EUR1.2 million (including share option cost reversal of EUR2.4 million as previously announced)

   --    Year end cash of EUR2.1 million 

Summary and Outlook

Paolo Bert, Chief Executive Officer, commented:

"The launch of the Acta Power system in 2013 has been a significant milestone for the Company and has enhanced Acta's brand profile in the marketplace and greatly increased its commercial opportunities. The system performs well and is gaining recognition for the unique benefits that it offers. Customer evaluations and system trials are proceeding with considerable success, notwithstanding delays due to customer installation procedures and logistical requirements.

The Company's key activities now range across the back-up power and renewable energy storage sectors together with electrolyser sales into a number of different applications. We continue to focus on high volume applications with strong economic drivers, and believe that the coming year will see substantial progress in the adoption of our products through our growing network of customers and commercial partners."

The Preliminary Results announcement is expected to be made on or around 26 March 2014.

(AIM: ACTA) The Clean Energy Products Company Cooperation Agreement with ReliOn 13 February 2014

RNS Number : 9521Z

Acta S.p.A.

13 February 2014

 
 Press release   13 February 2014 
 

Acta S.p.A.

("Acta" or "the Company")

Cooperation Agreement with ReliOn

Acta S.p.A. (AIM: ACTA), the clean energy products company is pleased to announce the signing of a wide-ranging cooperation agreement (the "Agreement") with ReliOn Inc. ("ReliOn"), one of the largest fuel cell manufacturers in the world specialising in back-up power systems for telecom, government and transportation applications. The Agreement gives Acta a broader commercial offering and a second supplier of key fuel cell components.

Today's Agreement follows the completion of a new Acta Power back-up power system incorporating ReliOn's fuel cell system, which has been designed with a 23" rack, the standard unit size for the US market. The Agreement covers the launch, promotion, production, commercialisation and distribution of the 23"-rack Acta Power HT.

As the market leader for telecom back-up power in North America, ReliOn is well positioned to partner and support the introduction of Acta's products into the US market. ReliOn will promote the new system in North America, whilst Acta will promote the system in all other markets in parallel with its FutureE / Ballard system.

Paolo Bert, Chief Executive Officer, Acta, commented:

"Today's Agreement marks further commercial progress for the Acta Power since its launch under a year ago. Through our partnership with ReliOn we look forward to collaborating on further product development for additional applications, and to the penetration of the Acta Power into the North American market."

Joe Blanchard, Chief Operating Officer, ReliOn, commented:

"The Agreement incorporating Acta's hydrogen electrolyzer with ReliOn's fuel cell products offers our customers an additional fueling solution, enabling them to address the requirements of equipment locations that have been challenging to this point. We look forward to jointly introducing the Acta Power HT to a variety of global markets."

The new Acta Power HT will be officially launched at the Mobile World Congress conference, the world's largest mobile and telecom exhibition, in Barcelona on 24-27 February, where it will be jointly promoted by Acta and ReliOn in Acta's stand, Hall 7, Stand 7M08.

Ceramic Fuel Cells Limited Consolidated Statement of Comprehensive Income For the half-year ended 31 December 2013

Consolidated Statement of Comprehensive Income For the half-year ended 31 December 2013

 
                                                                        Half-year 
                      Notes                                 2013                   2012 
                                                               $                      $ 
 
 
 Revenue from continuing operations           2        3,425,937              2,589,355 
 Cost of sales, service & warranty            4      (4,893,906)            (3,844,625) 
                                                  --------------  --------------------- 
 Gross profit/(loss)                                 (1,467,969)            (1,255,270) 
 
 Other income                                 3          421,216                471,916 
 
 Research & Product Development                      (3,933,071)            (4,297,603) 
 Manufacturing                                       (1,540,820)              (958,597) 
 General & Administration                            (4,129,040)            (4,952,071) 
 Sales & Marketing                                   (1,860,516)            (1,197,433) 
 Impairment Reversal / (Charge)                        1,973,570              (342,297) 
 Other Gains / (Losses) - Foreign 
  exchange                                             (866,662)               (41,430) 
 Finance costs                                         (447,505)               (36,497) 
 Loss before income tax                             (11,850,797)           (12,609,282) 
 
 Income tax benefit                                    4,022,582                      - 
                                                  --------------  --------------------- 
 Loss for the half-year entirely 
  attributable to members of Ceramic 
  Fuel Cells Limited                                 (7,828,215)           (12,609,282) 
 
 
 Other comprehensive income 
 Items which may be reclassified 
  to profit or loss 
 Exchange differences on translation 
  of foreign operations                                1,408,090                759,294 
 Other comprehensive income for 
  the half-year, net of tax                            1,408,090                759,294 
 
 Total comprehensive income/(expense) 
 for the half-year entirely attributable 
 to members of Ceramic Fuel Cells 
 Limited                                             (6,420,125)           (11,849,988) 
                                                  ==============  ===================== 
 
 
                                                           Cents                  Cents 
 Earnings per share for loss attributable 
 to the ordinary equity holders 
 of the company 
 Basic and diluted earnings per 
  share                                       15          (0.49)                 (0.86) 
 
 

The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.

Consolidated Balance Sheet

As at 31 December 2013

 
                                                    31 December         30 June 
                                        Notes              2013            2013 
                                                              $               $ 
 
 ASSETS 
 
 Current Assets 
    Cash and cash equivalents             5           9,034,469      10,010,131 
    Trade and other receivables           6           1,994,070       1,355,437 
    Inventories                           7          12,462,287       9,974,671 
    Other                                               368,044         825,506 
                                               ----------------  -------------- 
    Total Current Assets                             23,858,870      22,165,745 
                                               ----------------  -------------- 
 
 Non-Current Assets 
    Plant and equipment                              11,070,983      10,923,676 
    Intangible assets                                     1,000           1,000 
    Other                                               235,551         235,551 
                                               ----------------  -------------- 
    Total Non-Current Assets                         11,307,534      11,160,227 
                                               ----------------  -------------- 
 
 Total Assets                                        35,166,404      33,325,972 
                                               ----------------  -------------- 
 
 
 LIABILITIES 
 
 Current Liabilities 
    Trade and other payables                          3,266,882       2,328,053 
    Borrowings                            8             360,065       6,145,958 
    Derivative financial instruments      9                   -         663,878 
    Provisions                           10           2,896,219       3,406,824 
    Other liabilities                    11             926,693         862,431 
                                               ----------------  -------------- 
    Total Current Liabilities                         7,449,859      13,407,144 
                                               ----------------  -------------- 
 
 Non-Current Liabilities 
    Borrowings                            8           7,407,152         854,947 
    Derivative financial instruments      9             758,690               - 
    Provisions                           10           2,613,025       1,632,758 
    Other liabilities                    11           1,742,115       1,684,801 
                                               ----------------  -------------- 
    Total Non-Current Liabilities                    12,520,982       4,172,506 
                                               ----------------  -------------- 
 
 Total Liabilities                                   19,970,841      17,579,650 
                                               ----------------  -------------- 
 
 Net Assets                                          15,195,563      15,746,322 
                                               ================  ============== 
 
 
 EQUITY 
 
    Contributed equity                  13(b)       295,520,243     289,650,877 
    Reserves                                          3,735,332       2,327,242 
    Retained profits/(losses)                     (284,060,012)   (276,231,797) 
                                               ----------------  -------------- 
 
 Total Equity                                        15,195,563      15,746,322 
                                               ================  ============== 
 
 

The above consolidated balance sheet should be read in conjunction with the accompanying notes.

Consolidated Statement of Changes in Equity

For the half-year ended 31 December 2013

 
                                                    Entirely attributable to owners 
                                                      of Ceramic Fuel Cells Limited 
                                        ------------------------------------------------------- 
                                  Note   Contributed    Reserves        Retained          Total 
                                              equity                    earnings         equity 
                                                   $           $               $              $ 
 
 Balance at 1 July 
  2012                                   277,282,387      68,950   (256,454,181)     20,897,156 
 
 Profit/(loss) for 
  the half-year                                    -           -    (12,609,282)   (12,609,282) 
 Other comprehensive 
  income                                           -     759,294               -        759,294 
                                        ------------  ----------  --------------  ------------- 
 Total comprehensive 
  income for the 
  half-year                                        -     759,294    (12,609,282)   (11,849,988) 
 
 Transactions with 
  owners in their 
  capacity as owners 
 Contributions of 
  equity, net of 
  transaction costs                       11,085,544           -               -     11,085,544 
 Employee shares 
  - value of employee 
  services                                   190,440           -               -        190,440 
 Employee share 
  options - value 
  of employee services                             -      41,342               -         41,342 
 
 Balance at 31 December 
  2012                                   288,558,371     869,586   (269,063,463)     20,364,494 
 
 
 Balance at 1 July 
  2013                                   289,650,877   2,327,242   (276,231,797)     15,746,322 
 
 Profit/(loss) for 
  the half-year                                    -           -     (7,828,215)    (7,828,215) 
 Other comprehensive 
  income                                           -   1,408,090               -      1,408,090 
                                        ------------  ----------  --------------  ------------- 
 Total comprehensive 
  income for the 
  half-year                                        -   1,408,090     (7,828,215)    (6,420,125) 
 
 Transactions with 
  owners in their 
  capacity as owners 
 Contributions of 
  equity, net of 
  transaction costs              13(b)     5,517,155           -               -      5,517,155 
 Conversion of loan 
  notes                                      335,514           -               -        335,514 
 Employee shares 
  - net value of 
  services provided/(reversed 
  on forfeiture)                 13(b)       (6,520)           -               -        (6,520) 
 Employee shares 
  - net proceeds 
  from sale of forfeited 
  shares                                      23,217           -               -         23,217 
 
 Balance at 31 December 
  2013                                   295,520,243   3,735,332   (284,060,012)     15,195,563 
                                        ============  ==========  ==============  ============= 
 
 

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

Consolidated Statement of Cash Flows

Ceramic Fuel Cells Limited For the half-year ended 31 December 2013

For the half-year ended 31 December 2013

 
                                                                       Half-year 
                                           Notes             2013            2012 
                                                                $               $ 
 
 
 Cash Flows from Operating Activities 
 Receipts from customers 
  (inclusive of goods and services 
  tax)                                                  4,460,820       4,940,759 
 Payments to suppliers and employees 
  (inclusive of goods and services 
  tax)                                               (16,120,985)    (14,346,414) 
                                                  ---------------  -------------- 
                                                     (11,660,165)     (9,405,655) 
 Grant receipts (repayments)                             (27,659)               - 
 Other receipts                                           412,928         363,596 
 Income tax refunds received 
  (taxes paid)                                          4,022,582               - 
 Net cash inflow (outflow) from 
  operating activities                                (7,252,314)     (9,042,059) 
                                                  ---------------  -------------- 
 
 
 Cash Flows from Investing Activities 
 Payments for plant and equipment                       (148,924)       (151,353) 
 Proceeds from disposal of plant 
  and equipment                                         1,973,572             270 
 Decrease (increase) in security 
  deposits (including restricted 
  cash equivalents)                                        14,189          49,157 
                                                  ---------------  -------------- 
 Net cash inflow (outflow) from 
  investing activities                                  1,838,837       (101,926) 
                                                  ---------------  -------------- 
 
 
 Cash Flows from Financing Activities 
 Proceeds from issue of shares                          4,197,227      11,625,282 
 Proceeds from sale of forfeited 
  employee shares                                          23,363               - 
 Share issue costs                                        (6,234)       (539,314) 
 Forfeited employee shares disposal 
  costs                                                     (146)               - 
 Proceeds from borrowings - convertible 
  loan notes                                              339,041               - 
 Convertible loan note issue 
  costs                                                  (86,890)               - 
 Repayment of borrowings - finance 
  lease                                                 (172,192)       (133,764) 
 Interest received                                         33,336         109,413 
 Interest paid on borrowings 
  - convertible loan notes                              (300,591)               - 
 Interest paid on borrowings 
  - finance lease                                        (33,990)        (36,497) 
 Net cash inflow (outflow) from 
  financing activities                                  3,992,924      11,025,120 
                                                  ---------------  -------------- 
 
 Net increase (decrease) in cash 
  and cash equivalents                                (1,420,553)       1,881,135 
 Cash and cash equivalents at 
  the beginning of the half-year                       10,010,131       6,621,759 
 Effects of exchange rate changes 
  on cash and cash equivalents                            444,891         120,878 
                                                  ---------------  -------------- 
 Cash and cash equivalents at 
  the end of the half-year                     5        9,034,469       8,623,772 
                                                  ===============  ============== 
 
 

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.

Notes to the Consolidated Financial Statements

For the half-year ended 31 December 2013

Note 1. Basis of Preparation of Half-Year Report

This condensed consolidated interim financial report for the half-year reporting period ended 31 December 2013 has been prepared in accordance with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001. Accounting Standard AASB 134 is fully compliant with International Financial Reporting Standard IAS 34 Interim Financial Reporting.

This condensed consolidated interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2013 and any public announcements made by Ceramic Fuel Cells Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period.

The financial report has been prepared on a going concern basis.

Going Concern

Over the life of the Group it has incurred substantial operating losses and is yet to become cashflow positive at an operational level. The Directors are mindful of this and continue to closely monitor the level of the Company's cash resources.

The Group has commercialised its fuel cell technology into products and has begun to make sales, but it has not yet achieved sales and production levels that allow the Group to generate positive operating cashflow or profits. The Company is thus reliant on the further raising of capital (debt or equity) in order to enable it to continue its research and product development and to implement its sales and production strategies.

These factors represent uncertainty about the ability of the Group to continue as a going concern. The Directors have considered these factors and believe it is appropriate to prepare the financial statements on a going concern basis given the following strategies:

Operational and business strategies

The Company continues its focus on increasing the number of sales orders received and intends to produce to order rather than to anticipated sales demand. It also continues to make significant inroads in reducing the cost per unit.

During this reporting period, the Company announced that the Governments in the German states of Saxony and Hesse had established funding programmes to support the deployment and development of mCHP's. These are in addition to the Government of North-Rhine Westphalia (NRW)'s funding programme. Whilst uptake of these programmes is often slowed by bureaucracy, it is anticipated that they will assist the Company in meeting its sales targets and will assist in reducing the net price of a BlueGEN unit for the end user.

Management and the Board's recent focus had been to secure orders and deliver and install the products in order to convert these orders into revenue and cashflow. Management and the Board are taking steps to increase sales more quickly by implementing more aggressive marketing and pricing strategies.

The Company continues to take measures to reduce the unit cost of the BlueGEN. These measures include: outsourcing production of components to high quality, lower cost, specialist manufacturers, and undertaking cost-down engineering work.

Financing strategies

The Company has been successful in raising funds in the past and in December 2013 raised $5.8M (GBP3.3M) before expenses via a Share Purchase Plan and an Overseas Offer. A$4.2M (GBP2.4M) of this was received in December and A$1.6M (GBP0.9M) in early January 2014.

The Company was also successful in selling the assets of its UK Powder Plant in December 2013 for GBP1.2M (A$1.9M). The powder produced by the plant was no longer being used by the Company and hence a decision was made to realise a surplus asset. This amount was received in December 2013.

Notes to the Consolidated Financial Statements

For the half-year ended 31 December 2013 (continued)

As previously mentioned, the Company is currently pursuing several funding options to strengthen its balance sheet and to allow it to continue its research and product development programme whilst it implements its sales and production strategies. As advised to the market, the Board has approved a fundraising of at least GBP3 million pounds to occur during March 2014, GBP1 million of which will be contributed by the Company's Chairman, Alasdair Locke. Discussions with prospective parties are significantly advanced and further details of the capital raise will be announced to the market in the near future. This capital raise will require approval by shareholders at an Extraordinary General Meeting. Depending on the amount of capital raised and the success of both the Company's sales programme and its restructuring activities, a further capital raise is likely to be required in the second half of CY2014.

The Heinsberg capital expansion programme is on hold until further capital is raised.

The Managing Director is in the process of restructuring the Company to drive down its costs significantly and to focus on larger volume sales orders rather than individual unit sales. An example of this is the order received from Avilos (referred to previously). Securing sales such as these will assist in reducing inventory and provide working capital to sustain the research and product development activities and to enable the Company to produce to order rather than hold high inventory levels.

Ceramic Fuel Cells Limited Half Yearly Report -2- 3 March 2014

The Company's component outsourcing programme has progressed well with high quality, lower cost parts being received from its suppliers. Strategies are now in place to outsource further manufacturing of components in China which will further reduce the cost of production. In addition, our major suppliers have indicated that there will be significant cost savings once production volumes increase to reasonable levels. Unfortunately, with the SI agreement defaulting, these benefits will not be forthcoming in the short term. The Company works closely with its key supply chain partners and believes that they are both ready and capable of meeting the Company's future production volumes and required pricing levels.

At the time of writing, the Company no longer intends to increase production, until it secures orders which merit such an increase in capacity.

Technology

During this reporting period the Company continued to develop its technology further to improve the lifetime, reliability and robustness of its fuel cell stacks. Significant technical progress has been made on reducing the stacks' degradation rates. An enhanced product with these attributes is due to be released to the market in the last quarter of FY2014. In addition, substantial progress has been made on the ability of the stack to thermal cycle and modulate. These thermal cycling improvements are planned to be introduced to production in the first quarter of FY2015. Further work on improving the product will continue during the second half of this financial year.

Refund from Taxation Office for expenditure on research and development

The Company received A$4.0M (GBP2.2M) from the Australian Taxation Office during November for research and development expenditure incurred during FY2013. A further refund is likely to be received in November 2014 for FY2014.

Sale of powder plant assets and transfer of staff

In December the Company sold its powder plant assets in Bromborough, UK, for GBP1.1M (circa A$2.1M). A change in production process had resulted in CFCL no longer using the powder from the plant, hence, it realised a surplus asset which will have no detrimental effect on the production or financial operations of the Company. All the staff employed by CFCL at the powder plant have been transferred to the purchaser of the assets.

Financial Operating Results

During the half-year the number of units sold increased by 38 per cent over the comparative prior year period, and the overall level of revenue increased from A$2.6M (GBP1.5M) to A$3.4M (GBP2.0M). Revenue per unit sold is down from the prior period owing to the sales of the integrated units to EWE which were at a lower price in order to generate the sales and to enable the development of the integrated mCHP units with our integration partner, Bruns Heiztechnik. In order to promote sales, the Company sold units at close to standard cost price with the expectation that it will be able to reduce the cost of production and thus improve its gross margin in the future.

Over the comparative half-year period the average manufactured cost of the unit has reduced by approximately 15 per cent. Reduction of the manufactured cost continues to be a key strategic focus for the Company and the cost down programme that is in place is expected to achieve further significant cost reductions over the coming year.

The cost of warranty expense for the half-year was steady at A$1.0M (GBP0.6M) compared to A$1.1M (GBP0.7M) for the prior half-year. The Company is cognisant of the need to maintain an appropriate and conservative level of warranty provisioning and the provision at 31 December 2013 was A$3.3M (GBP1.9M) compared to A$1.8M (GBP1.0M) at 31 December 2012 and A$2.6M (GBP1.5M) at 30 June 2013. This increase is predominantly due to the greater number of units sold and the length of the service contracts.

Operating costs during the half-year were A$11.5M (GBP6.7M) compared to A$11.4M (GBP6.6M) for the comparative period last year. The prior year's figure included A$0.9M (GBP0.5M) of costs directly associated with the restructure of the Company's activities in late-2012. Research & Product Development costs have decreased by A$0.4M (GBP0.2M) from the corresponding period due to the afore-mentioned restructure and the consequential reduction in expenditure on core research & product development activities.

Manufacturing costs have been disclosed separately, as production in Germany is now a major activity for the Company. The increase in Manufacturing costs of A$0.6M (GBP0.3M) above the corresponding period is due to the increased production volumes in Germany and the under absorption of overheads.

General & Administration costs have decreased by A$0.8M (GBP0.5M) compared to last year due to the afore-mentioned restructure.

Sales & Marketing costs have increased by A$0.7M (GBP0.4M) over the corresponding period owing to the Company's previously disclosed strategy of increasing resources to target direct sales.

The impairment reversal of A$2.0M (GBP1.2M) for the half-year is a partial reversal, upon sale, of the A$2.6M (GBP1.5M) impairment charge recognized for the year ended 30 June 2012 on the full impairment of the plant and equipment of the Group's UK powder production plant.

Financing Activities

In December 2013 the Company completed a capital raising of A$5.8M (GBP3.3M) before expenses. This raising consisted of a Share Purchase Plan offer to qualifying shareholders in Australia and New Zealand that raised A$4.2M (GBP2.4M) and an Overseas Offer made to qualifying shareholders outside of Australia and New Zealand (and certain other territories) that raised A$1.6M (GBP0.9M). The Share Purchase Plan was undertaken at a price of 3.84 cents per share and the Overseas Offer was at a price of 2.14 pence per share (the equivalent of 3.84 cents). This pricing was designed to give eligible shareholders the ability to subscribe for ordinary shares at the same price as the investors who subscribed for the equity issue and convertible loan notes in May 2013. The Share Purchase Plan resulted in the issue of 109.3 million ordinary shares and the Overseas Offer resulted in the issue of a further 41.1 million ordinary shares.

As was disclosed in the Share Purchase Plan and Overseas Offer documentation, if the total amount raised was less than A$8.0M (GBP4.6M) the Company would be required to seek further funding in the first quarter of CY2014. It also stated that the Company would be unable to undertake the proposed capital expansion at its manufacturing facility and it would have to reduce the engineering work being done to lower the manufactured cost of BlueGEN units. The Directors believe this has resulted in a slower move down the manufacturing cost curve and, as a result, the Company has had to maintain a higher selling price which has reduced demand for the Company's products.

Matters Subsequent to the End of the Half-Year

As announced by the Company on 28 November 2013, CFCL had reached an agreement with Synergy International OÜ ("SI") whereby SI agreed to purchase a minimum of 1,000 BlueGEN mCHP units. The agreement stipulated a minimum order of 500 units per year on a take-or-pay basis for two years with an option to extend to a third year. The total sales value of the transaction was estimated to be in excess of EUR20 million.

Unfortunately, SI has reneged on the agreement reached in November 2013 as they have not made the upfront payments. This is a major setback for the Company as it had made significant financial investment in order to gear up its production to meet the sales order. Whilst dialogue between CFCL and SI continues, the Board has taken the decision that it is unlikely that SI will honour the agreement.

Partly as a consequence of SI's payment default, the Company has had to review the finances it has at its disposal. The Board has approved a fundraising of at least GBP3 million pounds to occur during March 2014, GBP1 million of which will be contributed by the Company's Chairman, Alasdair Locke. Discussions with prospective parties are significantly advanced and further details of the capital raise will be announced to the market in the near future. This capital raise will require approval by Shareholders at an Extraordinary General Meeting. Depending on the amount of capital raised and the success of both the Company's sales programme and its restructuring activities, a further capital raise is likely to be required in the second half of CY2014.

The Board is in the process of restructuring the Company with a view to altering its direct sales strategy and removing significant cost from the operations. It is also pursuing joint venture possibilities with partners who are willing to pay for the Company's technology in order to produce systems of differing output.

On 28 February 2014, the Company received an order for 100 BlueGEN units, for delivery within the next twelve months, from the German company Avilos GmbH ("Avilos"). Under the terms of the agreement, Avilos will purchase 100 BlueGEN units on a take-or-pay basis and sell them to private and small commercial customers. Avilos had previously signed up as regional, non-exclusive BlueGEN distribution partner and have received formal training in sales and installation from CFCL.

Avilos has locations both close to Munich (Southern Germany) and in Bremen (Northern Germany) and provides energy solutions for residential buildings and small commercial businesses. Based on the combination of fuel cells, PV solar systems, heat pumps and batteries, Avilos has developed intelligent energy management systems to offer customers a high level of self-sufficient power supply.

No other matter or circumstance has arisen since 31 December 2013 which has significantly affected, or may significantly affect:

Ceramic Fuel Cells Limited receives order from Avilos for 100 BlueGEN units Monday 3 March 2014

RNS Number : 3136B

Ceramic Fuel Cells Limited

03 March 2014

Market

Announcement

Monday 3 March 2014

CFCL receives order from Avilos for 100 BlueGEN units

On 28 February 2014, the Company received an order for 100 BlueGEN units, for delivery within the next twelve months, from the German company Avilos GmbH ("Avilos"). Under the terms of the agreement, Avilos will purchase 100 BlueGEN units on a take-or-pay basis and sell them to private and small commercial customers. Avilos had previously signed up as regional, non-exclusive BlueGEN distribution partner and have received formal training in sales and installation from CFCL.

Avilos has locations both close to Munich (Southern Germany) and in Bremen (Northern Germany) and provides energy solutions for residential buildings and small commercial businesses. Based on the combination of fuel cells, PV solar systems, heat pumps and batteries, Avilos has developed intelligent energy management systems to offer customers a high level of self-sufficient power supply.

-End-

Resignation of Director Dr Peter Binks Ceramic Fuel Cells Limited Monday 3 March 2014

RNS Number : 3137B

Ceramic Fuel Cells Limited

03 March 2014

Market

Announcement

Monday 3 March 2014

Resignation of Director - Dr Peter Binks

Ceramic Fuel Cells Limited announces the resignation of non-executive director Dr Peter Binks.

He has confirmed his intention to pursue other activities and his resignation applies with immediate effect.

The Board wishes to thank Dr. Binks for his contribution to the company's activities and wishes him well forthe future

-End-