REG - Invinity Energy Sys - Year-End Business Update

Invinity Energy SystemsAnnouncement

18/12/2023 07:00

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RNS Number : 1068X  Invinity Energy Systems PLC  18 December 2023

The information contained within this Announcement is deemed by Invinity
Energy Systems plc to constitute inside information as stipulated under the
Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK law by virtue
of the European Union (Withdrawal) Act 2018 ("MAR").

 

 

18 December 2023

Invinity Energy Systems plc

 

("Invinity" or the "Company")

 

Year-End Business Update

 

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF), a leading
global manufacturer of utility-grade energy storage, is pleased to provide an
update on current trading and business activities.

 

Financial & Corporate

 

The Company confirms that it expects to recognise a minimum total income of
£21.6m for 2023, a 500% increase on the prior year, and therefore deliver
financial results broadly in line with expectations for the full year.

 

Invinity continues to see strategic partnerships and investment as an
important pillar of its future corporate growth. The Company remains extremely
encouraged by the level of interest shown and resources being deployed by
potential strategic partners into the due-diligence process and can confirm
that it is currently in detailed discussions with a number of parties which it
would anticipate concluding during Q1 2024.

 

The Company continues to manage its cash resources prudently as it invests in
its next-generation product, code-named "Mistral". As a result of receipts
from existing customers and factoring in forecast receipts from current
product deliveries and recent project wins, including the recently announced
Mistral deliveries scheduled for 2024 and 2025, the Company currently
anticipates having sufficient cash resources into H2 2024.

 

Next-generation product development

 

Further to the update provided on 25 September 2023, Invinity confirms that
the development programme for its next-generation product continues to
progress well, in line with the expectations of both Invinity and development
partner Gamesa Electric. The first Mistral prototype has been assembled and
initial validation testing is in process at the Company's facility in
Vancouver, representing an important development milestone ahead of the
anticipated launch of the product next year. To date, Invinity has announced
funding for almost 100 MWh of orders for Mistral and expects to announce
further orders in due course.

 

Invinity is also pleased to announce that it has recently been awarded a CAD
$74,700 research grant from the National Research Council of Canada which will
be used to advance the Company's vanadium electrolyte development programme.

 

Commercial

 

The Company's pipeline continues to grow with opportunities to deploy nearly 6
GWh of Invinity batteries currently in various stages of commercial
discussions.

 

During the second half of 2023, management has been impressed by the increase
in volume and scale of opportunities which have entered into the Qualified
segment of the Company's pipeline.

 

While the Company's policy remains to not disclose customer details until
contracts are agreed, Invinity's qualified pipeline includes multiple new
opportunities in the 200 - 500 MWh size range across North America,
Australasia and Europe. In each case, the developers of these projects have
found the Company's technology to be highly appropriate for their needs
following review of existing Invinity project data or site visits and are now
actively engaged with Invinity's commercial team to scope and specify a
solution.

 

The increased size of these opportunities naturally leads to a longer sales
cycle than Invinity has previously experienced. While there can be no
guarantee that Invinity will be successful in securing these projects, the
Company views the growth in average potential order value as a strong positive
which supports Invinity's future corporate projections.

 

Invinity's current commercial pipeline as at 30 November 2023 is detailed
below. The Company is pleased to note a 25% total increase across the pipeline
since last reported. Many of these opportunities were generated as a result of
the Company's presence at key industry events in the UK, U.S. and Australia
during H2 2023. Material increases have been observed across all categories of
the pipeline apart from Advanced, the reduction in which is primarily due to
the advancement of one large U.S. project into the Base category and two
projects being assigned back to the Qualified group due to the extension of
project timelines.

 

 Date                Base (MWh)  Advanced (MWh)  Qualified         Qualified

Near Term (MWh)
Further Term (MWh)
 24-May-2023         42.8        73.4            957.1             1,397

 (FY22 Results)
 22-Sep-2023         43.1        137.3           1,415.0           3,057.8

 (HY23 Results)
 30-Nov-2023         49.8        92.0            1,898.5           3,790.7

 (Current Trading)
 % change vs. HY23   +16%        -33%            +34%              +24%

 

Update on contracting for grid-scale funded projects in the UK and U.S.

 

Invinity continues to make progress towards a final investment decision with
its preferred project partner in respect of the LODES project which was
awarded £11m of matched funding by the UK Government's Department for Energy
Security and Net Zero (DESNZ) in April 2023.

 

The Company is progressing towards concluding final contracts for the six
projects totalling 84 MWh which were awarded funding from the U.S. Department
of Energy ("DOE") in September 2023. Invinity has conducted a site visit and
formal project kick-off for the first of those projects and similar steps on
the remaining five projects are scheduled for early 2024.

 

Operational

 

The Company is pleased to confirm that it has achieved manufacturing output in
line with its production plan for the year. Key global production and
fulfilment statistics for the year to date include:

 

§ 720 cell-stacks manufactured at the Company's facilities in the UK and
Canada;

§ 103 Invinity VS3 batteries assembled, equal to 23.7 MWh of battery
capacity; and

§ More than 28 MWh of batteries shipped in the year to date.

 

Invinity's batteries in the field continue to deliver strong performance for
the Company's customers with more than 1.3 GWh of energy discharged from
Invinity's batteries connected to the UK grid alone in the year to date.

 

Larry Zulch, Chief Executive Officer at Invinity said:

 

"COP 28 and the U.S. DOE's recent announcement of funding for non-lithium
long-duration storage development are but the latest confirmations that global
demand for the kind of energy storage represented best by vanadium flow
batteries is undiminished. Dramatic increases in our qualified sales pipeline
for a product still in development underscores the opportunity. We continue to
advance ever-larger deals for our proven VS3 product as well. Together, this
interest reinforces market demand for our technology at ever-greater scale
although larger projects often take longer than we wish to close.

 

"Our challenges are two-fold: get the support of strategic partners as
previously disclosed and complete the development of Mistral. For the former,
we have been in deep discussions with multiple parties, and though the process
is not rapid, particularly in a difficult market environment, I'm highly
confident in our ability to formalise an appropriate relationship in the next
few months.

 

"The development of Mistral is on track. I'm very proud of our product
development team and the progress they are making toward a product that will
be transformational for Invinity. I firmly believe that the official launch of
Mistral next year will be the most significant announcement in the entire
stationary energy storage market in all of 2024.

 

"I'm pleased with our operational performance having delivered the largest
flow batteries ever deployed in multiple countries. Invinity has set out to do
something that has not been done before: make flow batteries into a proven,
factory-built product that transforms renewable energy into the kind of
dependable resource it must be to help power the future low-carbon world.
Invinity is well underway in the difficult but promising transition from a
development-stage company, to making significant revenue, to a profitable
company with class-leading products."

 

Stay up to date with news from Invinity. Join the distribution list for the
Company's monthly investor newsletter here
(https://invinity.com/newsletter/?utm_source=iesrns) .

 

Enquiries:

 

 Invinity Energy Systems plc                                             +44 (0)20 4551 0361
 Jonathan Marren, Chief Financial Officer and Chief Development Officer

 Joe Worthington, Director of Communications

 Canaccord Genuity (Nominated Adviser and Joint Broker)                  +44 (0)20 7523 8000
 Henry Fitzgerald-O'Connor / Harry Pardoe

 VSA Capital (Financial Adviser and Joint Broker)                        +44 (0)20 3005 5000
 Andrew Monk / Andrew Raca

 Tavistock (Financial PR Advisor)                                        +44 (0)20 7920 3150
 Simon Hudson / Charles Baister                                          invinity@tavistock.co.uk (mailto:invinity@tavistock.co.uk)

 

Notes to Editors

 

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF) manufactures
vanadium flow batteries for large-scale, high-throughput energy storage
requirements of business, industry and electrical networks.

 

Invinity's factory-built flow batteries run continually with no degradation
for over 25 years, making them suitable for the most demanding applications in
renewable energy production. Energy storage systems based on Invinity's
batteries are safe, reliable, and economical, and range in size from less than
250 kilowatt-hours to tens of megawatt-hours.

 

Invinity was created in April 2020 through the merger of two flow battery
industry leaders: redT energy plc and Avalon Battery Corporation. With over 70
MWh of systems already deployed or contracted for delivery across over 79
sites in 15 countries, Invinity is active in all major global energy storage
markets and has operations in the UK, Canada, USA, China and Australia.
Invinity Energy Systems plc is listed in the UK on AIM and AQSE and trades in
the USA on OTCQX.

 

To find out more, visit invinity.com (https://invinity.com/?utm_source=rns) ,
sign up to our monthly Investor Newsletter here
(https://invinity.com/newsletter/?utm_source=iesrns) or contact Investor
Relations on via +44 (0)20 4551 0361 or ir@invinity.com
(mailto:ir@invinity.com)

 

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