REG - Quadrise PLC - Interim Results and Investor Presentation
24/03/2025 07:00
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RNS Number : 7526B Quadrise PLC 24 March 2025
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic
law by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.
24 March 2025
Quadrise Plc
("Quadrise" or the "Company")
Interim Results and Investor Presentation
Quadrise Plc (AIM: QED), the transition technology provider for a cleaner
planet, announces its unaudited interim results for the six months ended 31
December 2024 ("H2 2024") and provides an update on developments during the
first quarter of 2025.
Chairman Andy Morrison, CEO Jason Miles and CFO David Scott will provide a
live presentation relating to the interim results via the Investor Meet
Company platform on 25 March 2025 at 12:00 noon GMT - registration
details are outlined below.
FINANCIAL SUMMARY
· £6.5 million (before costs) raised in January 2025 through a
successful placing and retail offer, increasing cash reserves to £7.1 million
at 28 February 2025 (31 December 2024: £1.4 million, 31 December 2023: £1.7
million).
· H2 2024 loss after tax of £1.7 million (H2 2023: £1.7 million).
This includes production and development costs of £0.8 million (H2 2023:
£0.9 million) and administration expenses of £0.9 million (H2 2023: £0.7
million).
· Total assets of £5.2 million at 31 December 2024 (31 December 2023:
£5.4 million).
BUSINESS SUMMARY
The Company's strategy is to generate demand within the shipping industry and
other sectors, while stimulating the supply of its fuels around global marine
bunkering hubs. The Company's projects are designed to fulfil this strategy,
with progress in each of these during the period outlined as follows:
Decarbonisation of shipping: MSC
· In November 2024, a Collaboration and Operational Trial Agreement was
signed with MSC and Cargill, committing the parties to complete trials on
board an MSC vessel to obtain a Letter of No Objection ('LONO') from engine
manufacturer Wärtsilä upon success.
· Work is now well underway to prepare the Quadrise trial equipment
ahead of installation and commissioning at the MAC² terminal in Antwerp,
Belgium in Q2 2025. In parallel, bilateral agreements between Quadrise, and
Cargill and MAC² respectively, are expected to be concluded soon.
· The operational trial is planned to commence in Q2 2025. It will
comprise an initial Proof of Concept period using MSAR(®) and then bioMSAR™
for performance baseline tests, followed by 4,000 hours of operation
(approximately 6-8 months) on bioMSAR™ in order to obtain the LONO.
Supporting projects: Establishing a global supply network
· Morocco: Preparations are underway for a commercial MSAR(®) trial
at a new site location at OCP's Jorf Lasfar facility, planned to commence in
Q2 2025. OCP and Quadrise are also exploring new fuel applications at other
OCP sites. The OCP Letter of Intent is facilitating Quadrise discussions with
potential MSAR(®) suppliers upon successful trial completion at Jorf Lasfar.
· Central America: A Material Transfer and Trial Agreement was signed
in December 2024 with Sparkle Power SA in Panama, to trial MSAR(®) and
bioMSAR™ at their 50MW El Giral power plant. Preparations are now underway
for the Q2 2025 trial, with a successful trial expected to lead to a Fuel
Supply Agreement and to facilitate discussions with other regional power
producers who currently use fuel oil.
· Utah: In January 2025, Quadrise and Valkor amended their 2023 Site
License and Supply Agreement, with Valkor committing to a $1 million license
fee along with staged payments in exchange for the provision of Quadrise
equipment and services. During recent months Valkor have optimised pilot
processing of produced oil and a sample has been shipped to QRF for testing to
progress US marketing.
Product development: bioMSAR™ and bioMSAR™ Zero
· bioMSAR testing on blends including B30 biofuel and 67% B50 biofuel
showed improved engine efficiency and reduced NOx and CO2 reductions when
compared to diesel.
· Quadrise is advancing joint development with BTG Bioliquids BV and
Vertoro BV to develop bioMSAR™ blends using pyrolysis sugars and crude sugar
oil respectively. A pilot and engine test programme on bioMSAR™ Zero is
planned, with sea-testing expected in 2025 with Focus Motor Yachts.
OUTLOOK
Energy economics, environmental concerns, and tightening emissions regulations
continue to drive the case for the adoption of MSAR(®) and bioMSAR™ fuels.
With the International Maritime Organization ('IMO') expected to mandate lower
greenhouse gas ('GHG') intensity fuels and to introduce a global maritime
emissions pricing mechanism to achieve net-zero by 2050, Quadrise is well
placed to capitalise. The Company's drop-in fuel solutions enable existing
fleets and thermal energy systems to decarbonise with minimal investment,
extending asset life while cutting costs and emissions.
The remainder of calendar year 2025 is set to be an important period for
Quadrise, with the installation and commissioning of trial equipment at MAC²
paving the way for operational vessel trials with MSC and Cargill aboard the
MSC Leandra V as a precursor to the conclusion of commercial agreements.
Meanwhile, the commercial trial at OCP's Jorf Lasfar site and the MAN diesel
engine trial at Sparkle Power in Panama are both planned to commence before
the financial year-end with each expected to lead to a commercial supply
contract upon success. Marketing efforts with low-sulphur, lower-carbon
MSAR(®) are also expected to commence following the lab testing programme on
Valkor's heavy sweet oil samples, with equipment delivery to Utah after the
Sparkle trial to enable supply to potential clients.
With strong market fundamentals, tightening regulations, and growing end-user
demand for cost-effective decarbonization solutions, the business case for
MSAR(®) and bioMSAR™ has never been stronger.
Jason Miles, Chief Executive Officer of Quadrise, commented:
"H2 2024 and the beginning of 2025 marked a step change for Quadrise as we
achieved key milestones, enabling the Company to raise gross proceeds of £6.5
million in January via a successful and oversubscribed placing and retail
offer. These funds provide the Company with the flexibility to enhance
delivery and prepare for accelerated scale-up of Quadrise technology in marine
and other sectors.
"Quadrise's technology offering is strategically positioned at a crucial
moment for the marine industry. New EU regulations and IMO measures will
accelerate decarbonisation in the shipping sector, creating new opportunities
for efficiency improvements and sustainable biofuels, and the commercial use
of MSAR(®) and bioMSAR™.
"Today the industry needs practical, scalable, and cost-effective solutions
for immediate emissions reductions. Quadrise is well positioned to meet this
need, offering drop-in fuel solutions for existing fleets with minimal
investment and offering extended asset life with reduced costs and emissions.
"Our progress over the period underscores the scale of the opportunity ahead.
Our focus now is on project execution in the short term, whilst also preparing
for rapid expansion. The board and management are fully committed to this
mission, and we appreciate the ongoing support of our shareholders in seeking
to shape a cleaner and prosperous future."
Investor Presentation via Investor Meet Company.
The presentation is open to all existing and potential shareholders. Questions
can be submitted pre-event via the Investor Meet Company dashboard up until
25 March 2025 at 09:00 GMT, or at any time during the live presentation.
Investors can sign up to Investor Meet Company for free and add to meet
Quadrise via:
https://www.investormeetcompany.com/quadrise-plc/register-investor
(https://www.investormeetcompany.com/quadrise-plc/register-investor)
Investors who already follow Quadrise on the Investor Meet Company platform
will automatically be invited.
For additional information, please contact:
Quadrise Plc +44 (0)20 7031 7321
Andy Morrison, Chairman
Jason Miles, Chief Executive Officer
Nominated Adviser
Cavendish Capital Markets Limited +44 (0)20 7220 0500
Ben Jeynes
Katy Birkin
Joint Brokers
Shore Capital Stockbrokers Limited
+44 (0)20 7408 4090
Toby Gibbs, Harry Davies-Ball (Corporate Advisory)
Fiona Conroy (Corporate Broking)
( ) ( ) ( )
VSA Capital Limited +44 (0)20 3005 5000
Andrew Raca (Corporate Finance)
Andrew Monk (Corporate Broking)
Public & Investor Relations
Cutbill Jacoby
Andy Cutbill +44 (0)7841 576000
Frankie Dundon +44 (0)7312 274086
About Quadrise
Quadrise is the supplier of MSAR(®) and bioMSAR™ emulsion technology, fuels
and biofuels, providing innovative solutions to reduce energy costs and
greenhouse gas emissions today for clients in the global shipping, power
generation, industrial and refining industries. Learn more
at: www.quadrise.com
(https://url.avanan.click/v2/___http:/www.quadrise.com/___.YXAxZTpzaG9yZWNhcDphOm86MWM2MDhhYWQ3NTcyYWZkYjk2MDUwZGIzNGIwNDA4OTg6NjoxMzI3Ojc3NzdhZGNiZmZkZTYxNTMwNmNiMWNhMjM4MDJhZWI2YTFhNjdiZGRhY2Q1NzliMjI1NzViOTkyMDdhMmRkN2Y6cDpU)
Chair's Statement
The six-month period ending 31 December 2024 marked a turning point for
Quadrise, with key operational milestones achieved. This momentum carried into
2025, with gross proceeds of £6.5 million raised in January via a successful
placing and retail offer to provide the Company with the resources required to
continue to advance this progress, de-risk operational delivery and prepare
for accelerated scale-up of Quadrise technology in marine and other sectors.
Following the fundraise, we welcomed Tony Foster to the board as a
non-executive director. Tony brings a wealth of shipping sector experience,
networks and growth-company expertise to the table. Vitally, he brings marine
regulatory insights and the voice of the customer direct to the Quadrise
boardroom. We also welcomed Dr Linda Sørensen to the management team as Head
of Marine. Based in Oslo, Norway, Linda brings considerable knowledge of
shipping operations and adds management bandwidth to our business development
and marine sector marketing activities.
Our technology offering is well-positioned at a crucial moment for the marine
industry. In April, the IMO's Marine Environment Protection Committee (MEPC)
is expected to adopt measures which will phase in the mandatory use of fuels
with less greenhouse gas ('GHG') intensity and introduce a global maritime GHG
emissions pricing mechanism. We anticipate that these measures will accelerate
decarbonisation in the shipping sector, creating new opportunities for
low-carbon fuel and sustainable biofuels such as MSAR(®) and bioMSAR™. We
will monitor developments closely, particularly regarding biomass regulations,
to ensure our strategy aligns with emerging compliance frameworks.
With vessel lifetimes often exceeding 20 years, shipowners need
cost-effective, scalable solutions to ensure decarbonisation compliance across
their existing fleets. We have had markedly increased levels of enquiries from
shipowners on the back of the confirmation of our forthcoming trials with MSC
and Cargill. We look forward to being able to share further developments once
negotiations progress to the agreements stage.
As we set out in our December 2024 Sustainability Report, our bioMSAR™
development programme continues to refine Quadrise solutions to offer low and
net-zero carbon solutions that can be scaled without costly port
infrastructure upgrades or introducing chemical hazards to onboard operations.
Progress with bioMSAR™ Zero (containing 100% biofuel) has been hugely
encouraging to date and has further raised awareness of our technology as we
expand our business network of potential customers, feedstock suppliers and
technology partners.
A further significant milestone was reached in January 2025 with the
announcement of an addendum to our Site Licence Agreement with Valkor in Utah,
which included the Company's first commercial licence revenues. This milestone
marks the transition of Quadrise to a revenue-generating business, enabling
the Company to offer trading updates and results guidance in future and
facilitating the publication of more comprehensive broker analysis.
While challenges remain, our progress over the period underscores the scale of
the opportunity ahead. Our focus now is on execution-delivering in the short
term while preparing for rapid expansion. The board and management are fully
committed to this mission, and we are pleased to have you with us on this
journey.
Financial Position
At 31 December 2023 the Group had a cash balance of £1.4m. In January 2025,
the Group raised additional gross proceeds of £6.53 million, £4.53 million
via a Placing and Subscription, and £2.0m via a Retail Offer to existing
shareholders. Cash reserves at 28 February 2025 stood at £7.1m.
The Group recorded a loss of £1.7 million for the six months to 31 December
2024 (H2 2023: £1.7 million). This included production and development costs
of £0.8 million (H2 2023: £0.9 million) and administration expenses of £0.9
million (H2 2023: £0.7 million).
The basic and diluted loss per share was 0.10p (H2 2023: 0.11p).
The Group's total assets amounted to £5.2 million as at 31 December 2024
(£5.4 million as at 31 December 2023). In addition to the cash and cash
equivalents, this included fixed tangible assets (mainly plant and equipment)
of £0.4 million and MSAR(®) trade name of £2.9 million.
The Group has tax losses arising in the UK of approximately £64.7 million
(2023: £62.0 million) that are potentially available to be carried forward
against future profits.
Andy Morrison
Non-executive Chair
21 March 2025
Chief Executive's Statement
The Energy Transition Opportunity
The shipping industry, responsible for 3% of global GHG emissions, faces
pressure to decarbonise. The maritime sector energy transition is
accelerating, driven by ambitious targets set by the European Union and the
International Maritime Organization (IMO). The IMO's Marine Environment
Protection Committee (MEPC) is expected to introduce measures mandating lower
GHG intensity fuels and a global maritime GHG emissions pricing mechanism,
aiming for net-zero GHG emissions by 2050.
Meanwhile, global trade flows and dynamics are evolving, with proposed U.S.
tariffs potentially reshaping shipping patterns and increasing operating costs
for Chinese-built ships calling at U.S. ports. If sanctioned, this could
impact over 30% of the global shipping fleet and more than 70% of new builds.
Long-term marine fuel solutions such as green ammonia, methanol and hydrogen
face safety and infrastructure challenges, as well as high costs. The industry
needs practical, scalable, and cost-effective solutions for immediate
emissions reductions. Quadrise is well positioned, offering drop-in fuel
solutions for existing fleets with minimal investment and offering extended
asset life with reduced costs and emissions.
Our patented blending technology produces MSAR(®) and ISCC certified
bioMSAR™ fuels, reducing CO2 and NOx emissions, and energy costs. MSAR(®)
lowers CO2 by up to 10%, while bioMSAR™ achieves over 25% less CO2 than
standard marine fuels. Both fuels reduce NOx emissions by at least 20%, and
consumer energy costs by 10% compared with comparable marine fuels and
biofuels.
Our modular container-size fuel systems are ready for rapid deployment,
providing immediate economic and environmental benefits. Each blending module
can manufacture both MSAR(®) and bioMSAR™, offering a lower-cost solution
and the opportunity to transition to sustainable biofuels.
Key Project Delivery
The execution of our projects is accelerating. Our focus during 2025 is on the
completion of the trials and commercial agreements that will showcase MSAR(®)
and bioMSAR™ technology deployment and entry into the commercial phase with
major clients.
Decarbonisation of Global Shipping: MSC & Cargill
The Company's flagship project with MSC Shipmanagement Ltd (MSC), the world's
largest shipping container fleet operator, aims to demonstrate the viability
of Quadrise fuels in decarbonising shipping. The project involves trials of
MSAR(®) and bioMSAR™ fuels on the MSC Leandra V vessel, leading to
commercial supply to MSC. During the trial, Cargill NV will supply the fuel
oil and sustainable glycerine feedstocks, handle bunkering operations and
supply the fuel from the MAC² terminal in Antwerp, Belgium.
Bilateral agreements with each partner are in final form and expected to be
concluded soon. Our terminal blending equipment is in the final stages of
preparation and testing for delivery and installation in Antwerp next month.
The commercial-scale trial is expected to consume around 10,000 tonnes of
Quadrise fuels. Once satisfactory progress is demonstrated during the vessel
trial, MSC, Cargill, and Quadrise intend to conclude long-term commercial
agreements for bioMSAR™ supply.
Quadrise is developing partnerships with other shipping and marine technology
companies to accelerate the commercialisation of bioMSAR™ and MSAR(®),
using its facilities in the Antwerp terminal, and by establishing similar
supply points in major marine bunker hubs.
In preparation for scaling the business, Quadrise signed a Collaboration
Agreement with Auramarine of Finland in November 2024. Auramarine are known
for their international presence and expertise in marine fuel systems. As well
as engineering expertise, the collaboration is expected to deliver new sales
opportunities, including deployment of the Quadrise patented "blend-on-board"
solution for tankers and other vessels that do not operate on regular routes.
Supporting projects: Establishing a global supply network
The availability of MSAR(®) and bioMSAR™ in major marine hubs will be
important for the scaling up of the Company's commercial decarbonisation
strategy.
In Morocco, our project with OCP SA aims to establish MSAR(®) supply in the
Mediterranean. A Commercial Framework Agreement was signed in May 2024 for a
30-day paid trial at OCP's Jorf Lasfar site, as a precursor to commercial
supply. Following changes in scheduling, OCP switched to an alternative
production line and kiln for the trial, requiring the relocation of Quadrise
equipment in the site. The trial is now expected to commence in Q2 2025 and
joint planning is underway.
As part of the May 2024 agreement, OCP provided a Letter of Intent for
long-term commercial supply of MSAR(®) upon successful trial completion.
Quadrise has been able to use this to facilitate discussions with potential
supply clients and licensees, and shipping companies such as MSC.
In Panama, Quadrise aims to establish a regional supply base for MSAR(®) and
bioMSAR™. An agreement was signed in December 2024 with Sparkle Power SA, a
Panamanian power generator, for a trial at its 50MW El Giral power plant.
Under this agreement, Quadrise will instal a 5-tonne-per-hour multi-fuel
manufacturing unit ("MMU") to produce MSAR(®) and bioMSAR™ for a short
trial on-site, supplying power to the Panama electricity grid. This marks the
first test on a MAN 4-stroke diesel engine, expanding our application
experience with this significant engine manufacturer. Preparations are well
underway for trial delivery during Q2 2025.
A successful trial expected to lead to an MSAR(®) supply agreement with
Sparkle and further opportunities within the region. The MMU to be used for
the Panama trial is then scheduled to be shipped to Valkor in Utah.
Quadrise continues to work towards creating a Southeast Asia supply point.
Upstream: Lower Carbon-Intensive Fuels
Our project with Valkor in Utah, USA, aims to supply low sulphur MSAR(®) and
bioMSAR™ fuels to the marine and power sectors. Valkor have interests in
several projects at the Asphalt Ridge site in Utah and expect to be able to
provide commercial volumes of heavy oil for conversion to bioMSAR™ and
MSAR(®) later in 2025, to facilitate site trials by potential customers. Upon
success, these would then lead to commercial fuel supply.
The oil extracted by Valkor has lower carbon intensity and very low sulphur
content, so is expected to comply with International Maritime Organisation
regulations for low sulphur marine fuels once converted to MSAR(®) or
bioMSAR™, without the need for carbon-intensive refining.
In January 2025 Quadrise and Valkor agreed to an addendum to the 2023 Site
License and Supply Agreement, under which Valkor have agreed to pay Quadrise:
- A license fee of $1.0 million, with an initial payment of $0.35
million and the balance of $0.65 million by December 2025.
- $0.2 million for the supply of a 5-tonne-per-hour MMU, with an
additional $0.3 million due upon supply of a full-size 6,000 bpd MMU.
- A quarterly payment of $75,000 from Q2 2025 for engineering,
process design, commissioning services, site operations, compliance support
and project development support services for a minimum of two years.
During the last six months, Valkor have been optimising their pilot plant
operation to maximise the quality of the produced oil, and have recently
shipped a representative sample to Quadrise for analysis, and bioMSAR™ and
MSAR(®) formulation. Fuel marketing to marine and power consumers will
commence once test results confirm product quality and supply costs. Quadrise
expects to share in the profits of future commercial agreements.
bioMSAR™ and bioMSAR™ Zero development
The Company's pioneering biofuel development programme aims to provide
sustainable, efficient, and user-friendly biofuels for the marine and energy
sectors, addressing key decarbonisation challenges. The goals include:
- Ensuring adaptability to blend various sustainable biofuel
feedstocks.
- Delivering a commercially viable bioMSAR™ Zero (B100) solution
before 2030 to comply with future greenhouse gas emission regulations.
In the period under review, significant progress was made:
- Testing bioMSAR™ blends with B30 biofuel showed over 38% CO2
reductions, 3-7% enhanced diesel engine efficiency, and 43-59% NOx emission
reductions compared to diesel.
- Developing bioMSAR™ Zero, combining 100% waste-based methyl
esters and glycerine, resulted in 85% lower CO2 emissions, 9-10% engine
efficiency improvements, and 18% NOx reduction compared to diesel.
- Testing bioMSAR™ formulations with 67% B50 biofuel and 33%
water showed 39% lower CO2 emissions, 7-8% engine efficiency improvements, and
29% NOx reduction compared to diesel.
Quadrise is advancing joint development with BTG Bioliquids BV and Vertoro BV
to develop bioMSAR™ formulations using pyrolysis sugars and crude sugar oil
(CSO™) respectively. A pilot and engine test programme on bioMSAR™ Zero is
scheduled, with sea-testing expected later in 2025 with Vertoro and Focus
Motor Yachts.
Outlook for 2025 and Beyond
Market and regulatory trends are creating a favourable environment for
Quadrise. New environmental regulations, especially in Europe, such as the EU
ETS and 'Fit-for-55', are expected to boost biofuel use and technology
investment in the shipping sector. As conventional biofuels like biodiesel and
renewable diesel face growing demand from other sectors, the need for
lower-cost, widely available non-conventional biofuels is likely to rise.
These trends, combined with the use of cheaper non-conventional waste-based
biofuel feedstocks such as glycerine, should enhance the attractiveness of
bioMSAR™ for end-users.
The continued development of bioMSAR™ and net-zero fuel solutions opens
exciting opportunities to deploy the unique Quadrise emulsion technology,
helping partners and clients achieve a cleaner future at a lower cost, and
with a shorter time to market.
With an expanding project pipeline and a growing partner network, momentum is
building and Quadrise is ready to play a key role in accelerating the global
energy transition. We have taken some important steps during the last six
months and much more remains to be done. The Quadrise team are thankful for
the support of our loyal and enthusiastic shareholders during this exciting
time for the Company.
Jason Miles
Chief Executive Officer
21 March 2025
Consolidated Statement of Comprehensive Income
For the 6 months ended 31 December 2024
Note 6 months ended 31 December 2024 6 months ended 31 December 2023 Year ended
Unaudited Unaudited 30 June
£'000 (restated) 2024
£'000 Audited
£'000
Continuing operations
Production and development costs (782) (911) (1,461)
Other administration expenses (854) (661) (1,336)
Share option charge 3 (118) (157) (260)
Warrant charge - - (30)
Loss on disposal of fixed assets 5 - - (3)
Foreign exchange loss (2) - (2)
Operating loss (1,756) (1,729) (3,092)
Finance costs (4) (5) (9)
Finance income 17 16 32
Loss before tax (1,743) (1,718) (3,069)
Taxation - - 209
Total comprehensive loss for the period from continuing operations (1,743) (1,718) (2,860)
Loss per share - pence
Basic 4 (0.10)p (0.11)p (0.18)p
Diluted 4 (0.10)p (0.11)p (0.18)p
Consolidated Statement of Financial
Position
As at 31 December
2024
Note As at As at As at
31 December 2024 31 December 2023 30 June
Unaudited Unaudited 2024
£'000 (restated) Audited
£'000 £'000
Assets
Non-current assets
Property, plant and equipment 5 434 337 388
Right of Use assets 6 98 221 159
Intangible assets 7 2,924 2,924 2,924
Non-current assets 3,456 3,482 3,471
Current assets
Cash and cash equivalents 1,386 1,658 3,048
Trade and other receivables 175 129 118
Prepayments 148 147 91
Current assets 1,709 1,934 3,257
TOTAL ASSETS 5,165 5,416 6,728
Equity and liabilities
Current liabilities
Trade and other payables 356 181 239
Lease liabilities 6 90 109 102
Provision for lease dilapidations 6 56 56 56
Current liabilities 502 346 397
Non-current liabilities
Lease liabilities 6 - 90 43
Non-current liabilities - 90 43
Equity attributable to equity holders of the parent
Issued share capital 17,648 15,625 17,648
Share premium 77,647 77,353 77,647
Merger reserve 3,777 3,777 3,777
Share option reserve 834 868 839
Warrant reserve 30 - 30
Reverse acquisition reserve 522 522 522
Accumulated losses (95,795) (93,165) (94,175)
Total shareholders' equity 4,663 4,980 6,288
TOTAL EQUITY AND LIABILITIES 5,165 5,416 6,728
Consolidated Statement of Changes in Equity
For the 6 months ended 31 December 2024
Issued share capital Share premium £'000 Merger reserve Share option reserve Warrant reserve £'000 Reverse acquisition reserve £'000 Accumulated
losses
£'000 £'000 £'000
Total
£'000
£'000
As at 1 July 2024 17,648 77,647 3,777 839 30 522 (94,175) 6,288
Loss and total comprehensive loss for the period - - - - - - (1,743) (1,743)
Share option charge - - - 118 - - - 118
Transfer of balances relating to expired warrants - - - (123) - - 123 -
Shareholders' equity at 31 December 2024 - unaudited 17,648 77,647 3,777 834 30 522 (95,795) 4,663
As at 1 July 2023 (restated) 14,069 77,189 3,777 718 - 522 (91,454) 4,821
Loss and total comprehensive loss for the period - - - - - - (1,718) (1,718)
Share option charge - - - 157 - - - 157
New shares issued net of issue costs 1,556 389 - - - - - 1,945
Issue costs - (225) - - - - - (225)
Transfer of balances relating to expired warrants - - - (7) - - 7 -
Shareholders' equity at 31 December 2023 - unaudited (restated) 15,625 77,353 3,777 868 - 522 (93,165) 4,980
As at 1 January 2024 15,625 77,353 3,777 868 - 522 (93,165) 4,980
Loss and total comprehensive loss for the period - - - - - - (1,142) (1,142)
Share option charge - - - 103 - - - 103
New shares issued net of issue costs 2,023 506 - - - - - 2,529
Issue costs - (212) - - - - - (212)
New warrants issued - - - - 30 - - 30
Transfer of balances relating to expired share options - - - (139) - - 139 -
Shareholders' equity at 30 June 2024 - audited 17,648 77,647 3,777 839 30 522 (94,175) 6,288
Consolidated Statement of Cash Flows
For the 6 months ended 31 December 2024
Note 6 months ended 31 December 2024 6 months ended 31 December 2023 Year ended
Unaudited Unaudited 30 June
£'000 (restated) 2024
£'000 Audited
£'000
Operating activities
Loss before tax from continuing operations (1,743) (1,718) (3,069)
Depreciation 5 98 107 205
Loss on disposal of fixed assets 5 - - 3
Finance costs paid 4 5 9
Finance income received (17) (16) (32)
Share option charge 3 118 157 260
Warrant charge - - 30
Working capital adjustments
Increase in trade and other receivables (57) (40) (29)
(Increase)/decrease in prepayments (57) (28) 28
Increase in trade and other payables 117 6 64
Decrease in inventory - 174 174
Cash utilised in operations (1,537) (1,353) (2,357)
Finance costs paid (4) (5) (9)
Taxation received - - 209
Net cash outflow from operating activities (1,541) (1,358) (2,157)
Investing activities
Finance income received 17 16 32
Purchase of fixed assets 5 (83) (8) (98)
Net cash (outflow)/inflow from investing activities (66) 8 (66)
Financing activities
Issue of ordinary share capital - 1,945 4,474
Issue costs - (225) (437)
Payment of lease liabilities 6 (55) (54) (108)
Net cash (outflow)/inflow from financing activities (55) 1,666 3,929
Net (decrease)/increase in cash and cash equivalents (1,662) 316 1,706
Cash and cash equivalents at the beginning of the period 3,048 1,342 1,342
Cash and cash equivalents at the end of the period 1,386 1,658 3,048
Notes to the Group Financial Statements
1. General Information
Quadrise ("QED", "Quadrise", or the "Company") and its subsidiaries (together
with the Company, the "Group") are engaged principally to develop markets for
its proprietary emulsion fuels, MSAR(®) and bioMSAR™ as low-cost, more
environmentally friendly substitutes for conventional heavy fuel oil for use
in power generation plants, industrial and upstream oil applications, and
marine diesel engines. The Company's ordinary shares are quoted on the AIM
market of the London Stock Exchange.
QED was incorporated on 22 October 2004 as a limited company under UK Company
Law with registered number 05267512. It is domiciled and registered at
Eastcastle House, 27-28 Eastcastle Street, London, W1W 8DH.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of the business.
The key risks that could affect the Company's medium term performance and the
factors that mitigate those risks have not substantially changed from those
set out in the Group's 30 June 2024 Annual Report and Financial Statements, a
copy of which is available on the Company's website: www.quadrise.com
(https://url.avanan.click/v2/r02/___http:/www.quadrise.com___.YXAxZTpzaG9yZWNhcDphOm86NjIzZjM2ZWE4NWVmYTU1YTQyZWY3OWU4ZThlZDZkZTI6NzpiNjZiOjg0N2NhNjU0NGEyMmRhN2VlNTMwYzdjOWQ0ODBjMTI4M2QzMjk4ZGRkZDE0ODY3N2RmNGVlM2IyZGRiNWUzNTU6cDpUOk4)
.
Critical accounting estimates
The preparation of interim accounts requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
end of the reporting period. Significant items subject to such estimates are
set out in Note 2.4 of the Group's 30 June 2024 Annual Report and Financial
Statements. The nature and amounts of such estimates have not changed
significantly during the interim period.
2. Summary of Significant Accounting Policies
2.1 Basis of Preparation
The financial information contained in this results announcement has been
prepared on the basis of the accounting policies set out in the statutory
financial statements for the year ended 30 June 2024. Whilst the financial
information included in this announcement has been prepared in accordance with
the recognition and measurement requirements of UK-adopted international
accounting standards and the requirements of the Companies Act 2006, this
announcement does not itself contain sufficient disclosures to comply with
IFRS. The financial information does not constitute the Group's statutory
financial statements for the years ended 30 June 2024 or 30 June 2023, but is
derived from those financial statements. Financial statements for the year
ended 30 June 2024 have been delivered to the Registrar of Companies and those
for the year ended 30 June 2025 will be delivered following the Company's
Annual General Meeting. The auditors' report on both the 30 June 2024 and 30
June 2023 financial statements were unqualified and did not contain statements
under section 498 (2) or (3) of the Companies Act 2006. The auditors' reports
on the 30 June 2024 and 30 June 2023 financial statements did draw attention
to a material uncertainty related to going concern.
These unaudited interim accounts have been prepared in accordance with AIM
Rules. In preparing this report, the group has adopted the guidance in the AIM
Rules for interim accounts which do not require that the interim condensed
group financial statements are prepared in accordance with IAS 34 "Interim
financial reporting".
The interim accounts for the six months ended 31 December 2024 were approved
by the Board on 21 March 2025.
The directors do not propose an interim dividend.
2.2 Going Concern
As at 31 December 2024 the Group had a cash balance of £1.4m. In January
2025, the Group raised additional gross proceeds of £6.53 million, £4.53m
via a Placing and Subscription, and £2.0m via a Retail Offer to existing
shareholders.
The funds raised, together with the existing cash balance, are anticipated to
be sufficient for the Group to achieve commercial revenues and sustainable
positive cashflows, which are expected to begin in Q3 2026. This expectation
is based on the Group's business model, budget, business plan, and sensitivity
analysis, all of which have been reviewed and approved by the Board. The
business model outlines projected Group cashflows through to 30 June 2033,
while the budget and business plan provide a detailed outlook for the next two
financial years.
The model incorporates financial projections for each project opportunity
considered to have a realistic likelihood of progressing, taking into account
assumptions regarding (i) the chosen operating model (licensing, tolling, or
merchant), (ii) the equity stake held in each venture, (iii) costs related to
chemicals and equipment, (iv) margins, and (v) growth rates. These assumptions
are informed by the latest market intelligence, agreements with
counterparties, and the current status of discussions. Consequently, the
Directors have a reasonable basis to believe that the Group's portfolio of
projects and business opportunities will generate commercially sustainable
revenues in the near future.
The Directors highlight the ongoing strong levels of engagement with partners,
potential clients, and project stakeholders worldwide during the period,
following the signature of key agreements including those with MSC, Cargill,
Valkor and Sparkle as outlined in the Chief Executive's statement. The
Directors believe that the economic and environmental benefits of MSAR® and
bioMSAR(TM) are becoming increasingly compelling, particularly in times of
global uncertainty, as counterparties seek both cost savings and enhanced
environmental performance.
Based on the rationale for the key assumptions outlined above, the Directors
have therefore made the judgement that the financial statements should be
prepared on a going concern basis.
3. Share Option charge
On 1 August 2024, the Company granted a total of 13,880,000 options (the
'Performance Options') over new ordinary shares of 1p each in the Company
executives and employees of the Company in accordance with the provisions of
the Company's Enterprise Management Incentive Plan ("EMI Plan") and the
Company's Unapproved Share Option Plan 2016 ("2016 Plan"). The issue of these
options follows the lapsing in full of the 13,500,000 options issued by the
Company on 3 August 2023 due to the specific performance conditions of those
options not having been met. 7,500,000 of the Performance Options were granted
to Jason Miles, Chief Executive Officer of the Company.
The Performance Options have an exercise price of 2.5p, and will vest as to
50% on the first anniversary of grant and the remaining 50% shall vest on the
second anniversary of the date of grant. All vestings are subject to the
satisfaction of specific performance conditions prior to the first anniversary
of grant. The Performance Options will be exercisable from vesting until the
eighth anniversary of the date of grant.
Additional Options
On 1 August 2024 Quadrise also granted 6,000,000 options over new ordinary
shares of 1p each in the Company to Non-Executive Directors of the Company in
accordance with the provisions of the 2016 Plan in the amounts set out below
(the "Additional Options").
Director No. of Options
Andrew Morrison 3,000,000
Laurie Mutch 1,500,000
Vicky Boiten Lee 1,500,000
Total 6,000,000
The Additional Options have an exercise price of 2.5p. There are no
performance conditions to the vesting of the Additional Options, which will
vest as to 50% on the first anniversary of grant and the remaining 50% shall
vest on the second anniversary of the date of grant. The Additional Options
will be exercisable from vesting until the eighth anniversary of the date of
grant.
Nominal Value Options
On 1 August 2024, the Company granted a total of 4,195,804 nominal value
options ('NVOs') over new ordinary shares of 1p each in the Company to
executives and employees in accordance with the provisions of the EMI Plan.
These Options have an exercise price of 1p, and will vest after 12 months from
the date of grant, with vesting not subject to performance conditions. The
NVOs will be exercisable from vesting until the tenth anniversary of the date
of grant.
The Share Option Schemes are equity settled plans, and fair value is measured
at the grant date of the option. Options issued under the Schemes vest over a
one-to-three-year period provided the recipient remains an employee of the
Group. Options also may be exercised within one year of an employee leaving
the Group at the discretion of the Board.
The share option charge for the period was £118k (2023: £157k).
4. Loss Per Share
The calculation of loss per share is based on the following loss and number of
shares:
6 months ended 31 December 2024 6 months ended Year ended
Unaudited 31 December 30 June
2023 2024
Unaudited Audited
Loss for the period from continuing operations (£'000s) (1,743) (1,718) (2,860)
Weighted average number of shares:
Basic 1,764,714,550 1,541,341,071 1,600,731,743
Diluted 1,764,714,550 1,541,341,071 1,600,731,743
Loss per share:
Basic (0.10)p (0.11)p (0.18)p
Diluted (0.10)p (0.11)p (0.18)p
Basic loss per share is calculated by dividing the loss for the period from
continuing operations of the Group by the weighted average number of ordinary
shares in issue during the period.
For diluted loss per share, the weighted average number of ordinary shares in
issue is adjusted to assume conversion of all potential dilutive options and
warrants over ordinary shares. Potential ordinary shares resulting from the
exercise of share options and warrants have an anti-dilutive effect due to the
Group being in a loss position. As a result, diluted loss per share is
disclosed as the same value as basic loss per share.
The 64.0 million exercisable share options issued by the Company and which are
outstanding at the period-end could potentially dilute earnings per share in
the future if exercised when the Group is in a profit-making position.
5. Property, Plant and Equipment
Leasehold improvements Computer equipment Software Furniture and Office equipment Plant and machinery Total
£'000 £'000 £'000 £'000 £'000 £'000
Cost
Opening balance - 1 July 2024 89 97 23 24 1,557 1,790
Additions - 3 - - 80 83
Closing balance - 31 December 2024 89 100 23 24 1,637 1,873
Depreciation
Opening balance - 1 July 2024 (82) (93) (23) (17) (1,187) (1,402)
Depreciation charge for the period (2) (1) - - (34) (37)
Closing balance - 31 December 2024 (84) (94) (23) (17) (1,221) (1,439)
Net book value at 31 December 2024 - unaudited 5 6 - 7 416 434
Cost
Opening balance - 1 July 2023 89 96 43 24 1,524 1,776
Additions - - - - 8 8
Closing balance - 31 December 2023 89 96 43 24 1,532 1,784
Depreciation
Opening balance - 1 July 2023 (79) (91) (43) (16) (1,173) (1,402)
Depreciation charge for the period (2) (1) - - (42) (45)
Closing balance - 31 December 2023 (81) (92) (43) (16) (1,215) (1,447)
Net book value at 31 December 20234 - unaudited 8 4 - 8 317 337
Cost
Opening balance - 1 July 2023 89 96 43 24 1,524 1,776
Additions - 1 - - 97 98
Disposals - - (20) - (64) (84)
Closing balance - 30 June 2024 89 97 23 24 1,557 1,790
Depreciation
Opening balance - 1 July 2023 (79) (91) (43) (16) (1,173) (1,402)
Depreciation charge for the year (3) (2) - (1) (75) (81)
Disposals - - 20 - 61 81
Closing balance - 30 June 2024 (82) (93) (23) (17) (1,187) (1,402)
Net book value at 30 June 2024 - audited 7 4 - 7 370 388
6. Lease Obligations
The Group follows IFRS 16 with respect to its leases, whereby the Group
recognises right-of-use assets and lease liabilities for all leases on its
balance sheet. Quadrise Plc and Quadrise International Limited have agreements
for the lease of the Group head office and the Quadrise Research Facility
respectively, to which IFS 16 has been applied.
Amounts recognised in the statement of financial position relating to leases: 31 December 31 December
2024 2023
£'000s £'000s
Right of Use Assets
Property leases 98 221
Provisions
Provision for lease dilapidations 56 56
Lease liabilities
Liability falls due within 1 year 90 109
Liability falls due within 1-3 years - 90
Total 90 199
Additions to right of use assets during the financial year were £nil (2023:
£276k)
Provision for lease dilapidations
The Group and Company are required to restore the leased premises of its head
office and research facility to their original condition at the end of the
respective lease terms. A provision has been recognised for the present value
of the estimated expenditure required to remove any leasehold improvements.
These costs have been capitalised as part of the cost of leasehold
improvements and are amortised over the shorter of the term of the lease and
the useful life of the assets.
Amounts recognised in the statement of comprehensive income relating to
leases:
6 months ended 31 December 6 months ended 31 December
2024 2023
£'000s £'000s
Depreciation charge of right of use assets 62 62
Interest expense 2 3
Total cash outflow for leases (55) (54)
7. Intangible Assets
QCC royalty payments MSAR(®) trade name Technology and know-how
Total
£'000 £'000 £'000 £'000
Cost
Balance as at 1 July 2024 and 31 December 2024 7,686 3,100 25,901 36,687
Amortisation and Impairment
Balance as at 1 July 2024 and 31 December 2024 (7,686) (176) (25,901) (33,763)
Net book value at 31 December 2024 - unaudited - 2,924 - 2,924
Cost
Balance as at 1 July 2023 and 31 December 2023 7,686 3,100 25,901 36,687
Amortisation and Impairment
Balance as at 1 July 2023 and 31 December 2023 (7,686) (176) (25,901) (33,763)
Net book value at 31 December 2023 - unaudited - 2,924 - 2,924
Cost
Balance at 1 July 2023 and 30 June 2024 7,686 3,100 25,901 36,687
- - - -
Amortisation and Impairment
Balance at 1 July 2023 and 30 June 2024 (7,686) (176) (25,901) (33,763)
Net book value at 30 June 2024 - audited - 2,924 - 2,924
Intangibles comprise intellectual property with a cost of £36.69m, including
assets of finite and indefinite life. QCC royalty payments of £7.69m and the
MSAR(®) trade name of £3.10m are termed as assets having indefinite life as
it is assessed that there is no foreseeable limit to the period over which the
assets are expected to generate net cash inflows for the Group. The assets
with indefinite life are not amortised. The remaining intangibles amounting to
£25.90m, primarily made up of technology and know-how, are considered as
finite assets and are now fully amortised. The Group does not have any
internally generated intangibles.
The Group tests intangible assets annually for impairment, or more frequently
if there are indications that they might be impaired. As at 30 June 2024, the
QCC royalty payments asset and the technology and know-how asset were fully
impaired and the MSAR(®) trade name asset had a net book value of £2.924m.
For the six-month period to 31 December 2024, there was no indication that the
MSAR(®) trade name asset may be impaired.
As a result, the Directors concluded that no impairment is necessary for the
six-month period to 31 December 2024.
8. Related Party Transactions
QED defines key management personnel as the Directors of the Company. Other
than the issuance of share options to Directors (note 3) there are no
transactions with Directors other than their remuneration.
9. Prior year restatement
Under IFRS 16, the disclosures and accounting treatment of leases required
under this standard should have been adopted for the period ended 31 December
2023. The comparative figures for the year ended 31 December 2023 have been
therefore been restated to reflect the correct accounting treatment.. Each of
the affected financial statement line items for the prior periods has been
restated as follows:
Consolidated Statement of Comprehensive Income 31 December 2023 £'000 Increase/(decrease) 31 December 2023 (restated) £'000
Production and development cost (909) (2) (911)
Other administrative expenses (658) (3) (661)
Finance costs (2) (3) (5)
Loss before tax (1,710) (8) (1,718)
Consolidated Statement of Financial Position 31 December 2023 £'000 Increase/(decrease) 31 December 2023 (restated) £'000
Right of use assets - 221 221
Provision for lease dilapidations - (56) (56)
Lease liabilities due in less than one year - (109) (109)
Lease liabilities due in greater than one year - (90) (90)
Accumulated losses (93,131) (34) (93,165)
Consolidated Statement of Changes in Equity 31 December 2023 £'000 Increase/(decrease) 31 December 2023 (restated) £'000
Accumulated losses as at 1 July 2023 (93,131) (34) (93,165)
Loss and total comprehensive loss for the year (1,710) (8) (1,718)
Consolidated Statement of Cash Flows 31 December 2023 £'000 Increase/(decrease) 31 December 2023 (restated) £'000
Loss before tax from continuing operations (1,710) (8) (1,718)
Depreciation 45 62 107
Finance costs paid 2 3 5
Payment of lease liabilities - (54) (54)
10. Events After the End of the Reporting Period
On 24 January 2025 the Company raised total gross proceeds
of £4.53 million pursuant to a Placing and Subscription of
151,000,000 New Ordinary Shares at a price of 3.0 pence per share. On 31
January 2025, additional gross proceeds of £2.0 million were raised from a
Retail Offer to qualifying shareholders for a total of 66,666,666 New Ordinary
Shares at a price of 3.0 pence per share. The Placing, Subscription and
subsequent Retail Offer raised a total of £6.53 million (before expenses)
for the Company.
11. Copies of the Interim Accounts
Copies of the interim accounts are available on the Company's website at
www.quadrise.com.
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