Invinity Energy Systems (IES) H2 2023 earnings summary

Executive summary

• Achieved a 511% year-over-year increase in revenue to £22.0m in 2023, driven by an 800% rise in product shipments to 32.5 MWh and significant project deliveries across multiple continents.

• Signed or awarded funding for 136.7 MWh of orders for 2024/25, including 100 MWh of Mistral orders, with a substantial increase in the commercial pipeline, which grew 170% YoY to 6.6 GWh as of June 2024.

• Secured a clean going concern statement from new auditors, enhancing credibility with customers and suppliers.

• Focused on building a sustainable, cash-generative business with a capex-light manufacturing expansion and transition to profitability.

Financial highlights

• Revenue reached £22.0m in 2023, with major contributions from projects in Australia, the U.S., Canada, the U.K., and Europe.

• Operating loss increased to £22.8m, mainly due to legacy loss-making projects; other projects achieved flat or positive gross margins.

• Cash position at end of May was £53.2m, reflecting a successful £57.4m fundraising round cornerstoned by UKIB.

• Admin costs remained broadly unchanged year-over-year at £19.1m; staff costs increased due to headcount investment.

• Cash outflows reduced by 10% to £19.7m; net decrease in professional fees and admin expenses by £1.3m.

Outlook and guidance

• Mistral product launch expected by year-end 2024, with focus on ensuring product reliability and performance.

• Anticipates significant margin improvement with Mistral, targeting 20-30% gross margin through cost reduction and scale.

• Targeting net cash generation and profitability within two years.

• Commercial pipeline growing, with average opportunity size now over 100 MWh and further growth expected as Siemens Gamesa partnership matures.

• Strategic focus on core markets (North America, U.K., E.U.) and capital-light expansion via licensing in non-core regions.