REG - CAP-XX Limited - AGM Trading Update

CAP XXAnnouncement

03/11/2023 07:15

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RNS Number : 2716S  CAP-XX Limited  03 November 2023

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3 November 2023

CAP-XX Limited

("CAP-XX" or "the Company")

AGM Trading Update

CAP-XX Limited, a world leader in the design and manufacture of
supercapacitors and energy management systems, announces that at the Company's
Annual General Meeting to be held later today, the following statement will be
made in relation to the Company's activities.

Current Sales

Preliminary October 2023 product revenue was US$0.4m (approximately AUD$0.6m)
and for the four months to the end of October 2023 was US$0.9m (AUD$1.5m).
This compares with product revenues of US$0.7m (AUD$1.1m) in the previous
corresponding four month period of last year, a year on year increase of
approximately 35%.

October is typically one of the highest revenue months for the financial year
and this revenue result is an early indicator that the overstocking and supply
chain issues that were evident during FY2023 are showing signs of recovery.

Order Intake

CAP-XX's sales priorities remain focused on prismatic Electric Double Layer
Capacitor (EDLC) and cylindrical 'can' business, followed by customer module
solutions.

The Company is seeing an increase in activity and interest in CAP-XX's
products from the USA, Europe, India as well as South Africa and this is
evidenced by a marked increase in the request for samples across the product
range, especially in Europe and the USA. Activities in Asia remain subdued due
to the economic situation post COVID.

The current order backlog is US$1.15 million and order intake is supportive of
a further improvement in revenues.

Enquiries and orders from Europe and the USA are higher, but we are
experiencing some slower order intake from China and India, primarily for the
cylindrical 'can' products where the overstocking position of many
customers/distributors has not yet fully worked through.

Distribution and Sales Strategy

We have made good progress in building our new sales and distribution
capabilities. We have appointed additional distributors and sales
representatives mainly in the USA, Europe and India. There are further
appointments currently in final negotiations which are expected to be
completed by calendar year-end 2023. These new distributors and sales
representatives are commission based and have been trained in relation to the
CAP-XX product range and we expect to see revenue results progressively build
through calendar 2024.

The whole CAP-XX team is working hard to ensure that a strong focus on the
customer is maintained, in addition to building good relationships with
suppliers, distributors and sales representatives.

CAP-XX will remain focused on Internet of Things (IoT), automotive, medical,
military, industrial and telecom applications and associated markets with a
particular concentration on handheld devices, tracking, security and live aid
systems.

New Product Development

We continue to advance our new products, specifically DMH, 3V and SMD. The DMH
product samples are on track for delivery by calendar year-end 2023, with
commercial production expected to commence in early calendar year 2024. First
orders are already in hand with several other customers evaluating the
product.

The 3V product continues to be evaluated by several potential large volume
customers and we continue to expect design wins, with initial orders expected
in the first half of calendar year 2024.

The cylindrical SMD device is continuing through development trials and we
anticipate design wins through the remainder of 2023/24, with full commercial
production scheduled for 2024/25.

In addition to these new products that we have been working on for some time,
we have re-formatted some EDLC prismatic supercapacitors as embedded versions,
which allows our customers to use our technology as a plug and play solution.

Intellectual Property

We are well advanced in the final evaluation of the Ionic graphene product and
are currently in joint venture negotiations. We are also actively evaluating
other technologies that are complementary to our own.

The Maxwell legal case is currently set for hearing from 11 to 15 December
2023 in the US Supreme Court.  We are unable to make any further comment at
this time, except that our team is very well prepared.

We last received royalty payments from AVX in January 2023 for the 2022 year.
We have been disputing the contract interpretation adopted by AVX and there
are preliminary court hearings underway. The Company's position has not
altered, and we remain confident of a favorable outcome in both cases.

Quality Certification

CAP-XX is very conscious of the need to have the highest level of quality
compliance in place. We already have ISO 9001 certification covering quality
management systems and are actively working to achieve ISO 14001 which covers
environmental management systems. The Company views these as essential
standards aimed at meeting customers' requirements and expectations.

Production

Operating performance at Seven Hills and our contract manufacturer in Malaysia
is improving. However, there are more gains to be made through programs of
continuous improvement.

Cash

Currently, cash reserves are approximately AUD$0.5m, excluding the Australian
Tax R&D Rebate for 2022/23. The rebate was formally submitted in October
2023, and a payment of AUD$2.1m is expected to be received in the coming
weeks.

Outlook

As highlighted in the Annual Report, CAP-XX is reviewing the current sales
project pipeline, including feasibility studies and timelines.

We expect to see the new distribution and sales strategy begin to demonstrate
positive results in the coming months. We are seeing product revenues
improving and, barring a general economic downturn, we expect this to
continue.

Finally, the Company is keenly looking forward to the initial revenues from
new products in which the Company has made significant investments over recent
years.

 

 

For further information contact:

 CAP-XX Limited                                               +61 (0) 2 9428 0139

 Pat Elliott (Chairman)

 Lars Stegmann (CEO)

 Kreab (Financial PR)                                         +44 (0) 20 7074 1800

 Robert Speed

 Allenby Capital (Nominated Adviser and Joint Broker)         +44 (0) 20 3328 5656

 David Hart / Piers Shimwell (Corporate Finance)

 Tony Quirke/Stefano Aquilino (Sales and Corporate Broking)

 Cavendish Securities plc (Joint Broker)                      +44 (0) 13 1220 6939

 Neil McDonald / Pearl Kellie

 

More information is available at www.cap-xx.com (http://www.cap-xx.com)

 

Notes to Editors:

 

CAP-XX (LSE:CPX) is a world leader in the design and manufacture of ultra-thin
prismatic and compact cylindrical supercapacitors. Its prismatic
supercapacitors are manufactured in Australia and Malaysia and its cylindrical
supercapacitors are manufactured in China. The company's strong intellectual
property (IP) portfolio includes 11 patent families. CAP-XX's ultra-thin
prismatic supercapacitors are ideal for space-constrained electronics
applications where small energy storage device size and thickness are
important. The unique feature of CAP-XX supercapacitors is their very
high-power density and high-energy storage capacity in space-efficient thin
prismatic and compact cylindrical packages. For more information, visit
https://www.cap-xx.com/ (https://www.cap-xx.com/) or email sales@cap-xx.com.

 

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