Sustainable fuel technology Company Velocys PLC (LON: VLS) saw losses during the first half alongside a contraction in revenue, as it commercialised its alternative fuels.
The Company’s operating losses narrowed from £11.0 million to £5.2 million year-on-year during the first half, it also added that it raised £7 million in funds during July. However, the positive effects of these developments were offset by its revenues folding from £392,000 to £22,000.
Velocys said its Bayou Fuels Mississippi project was converted to a solar power source with carbon capture capabilities. The Group said this would significantly improve its returns and would create, “an attractive differentiator for investment into this project.”
The Company added that its Immingham UK project had completed all pre-FEED work and it had delivered one reactor and all the catalyst to its client Red Rock Biofuels.
Henrik Wareborn, CEO, said,
“2019 has been a positive year for the Company. The demand for our Fischer Tropsch technology is growing on both sides of the Atlantic, which is why we have concentrated our efforts on project development and reactor manufacturing. These last six months have seen Velocys accelerate the move from concept to commercialisation – transitioning from research, development and testing, to focusing on commercial scale client delivery and operational excellence.”
“We have delivered our first reactor and all catalyst charges to our client in Oregon (Red Rock Biofuels) and the manufacturing of the remaining reactors is advancing. We are now focusing all our efforts on commercial delivery – for our client in Oregon and for our two projects in Mississippi, USA (Bayou Fuels) and Immingham, UK (Altalto).”
“None of this would have been possible without the recent support of our shareholders new and old along with the hard work and dedication that all our staff have put in to achieve the Company’s goals. I would like to make a personal thanks to Dr Pierre Jungels for his guidance of the Company over the years that he has been Chairman and wish him well for the future.”
The Company’s shares dipped 8.39% or 0.23p to 2.48p per share 18/09/19 14:23 BST. Analysts from Numis reiterated its ‘Buy’ stance on Velocys stock. Neither the Group’s p/e ratio nor their dividend yield are available; they are continuing to implement their long-term strategy, which doesn’t promise much return for shareholders in the immediate future.
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