Commentary and Update – 2nd Quarter 2009
Strong Cash and Asset Position with No Debt
Highlights
· Retains strong cash position - $8.0 Million cash on hand
· Sales for six months exceed forecasts
· Continuing increase in cash inflows
· Reducing operational expenditure
· Increased spend on inventory to meet contracts and order forecast
· Options settlement yields $1.83 million
· No debt
Half way through FY 2009 Dyesol continues to perform strongly, finishing the second quarter with cash reserves of $7.98 million with net operational cash usage for quarter on par with the previous quarter. The Dyesol order book exceeds $5M. The cash is backed up by physical assets at written down value of $5.72M as well as the company’s extensive world-wide IP portfolio. Nett assets are nearly $22M. Dyesol continues to operate debt free. Government project debtors totalling $1.25M have been received. The payments from the Welsh Assembly Government continue to lag expenditure by about 4 months, as is normal practice for such grants.
The first six months of the year have seen Dyesol sales of over $2.6 Million exceed expectations with forecasts for the second six months of further growth. These sales have been reflected in cash inflow of $1.054M for the quarter and $1.985M for the six month period (noting that some Asian projects had advance payments in the previous year). Dyesol closes the six months with $1.7M of inventories having increased inventory by $746K over the six months. This inventory comprises $523K of long-life raw materials being predominantly dye ligands, $738K of work in progress comprising both materials and equipment and $445K of finished goods including $313K of equipment destined for customers this financial year. Inventory is valued at the lower of net receivable value or cost. The 2nd Quarter demonstrated that Dyesol has achieved its goals to stabilise operational spending while increasing revenue. It is noted that all Dyesol’s cash is held as current deposits in top trading banks in Australia (CBA and Westpac/St George), UK (HSBC), Switzerland (Raiffeisen), and Italy (BPM).
During the quarter, Dyesol opened the new manufacturing facilities in Queanbeyan, the Development Facility in St Asaph (North Wales) and the joint PV Accelerator facility with Corus at Shotton. Residual expenditure associated with completion of these facilities totalled $507K. No further significant capital expenditure is forecast this financial year.
During this reporting period, shareholders exercised over 9 million options adding $1.834M cash to the company’s reserves. Following receipt of legal advice, the company advanced loans totalling $1.401M to directors related primarily to settlement of options. In January, $400,000 was repaid and the remainder is to be repaid in the next period.
In December the company undertook a detailed budget review entailing line by line costing for each of the six operating subsidiaries and 12 projects to ensure that the company has an appropriate fiscal plan to continue expansion throughout 2009. This has resulted in further control of expenditure in relation to new projects not yet committed and acceleration of commitment to the core activities of Dye Solar Cells on metal and glass. In December, Dyesol announced that Corus and Dyesol had committed to accelerate the production of the strip steel DSC in anticipation of market recovery in 2010.
Dyesol enters the second half of FY 2009 with enthusiasm that the company will continue to grow despite the current recession in the developed world and that Dye Solar Cell products will gain increasing acceptance as the benefits of this revolutionary technology are appreciated in comparison with the higher cost of power from competing technologies.
Authorised by: Dr Gavin Tulloch (Managing Director Global Dyesol Limited) +61 (0) 62991250
Note to editors
The Technology – DYE SOLAR CELLS
DSC technology can best be described as ‘artificial photosynthesis’ using an electrolyte, a layer of titania (a pigment used in white paints and tooth paste) and ruthenium dye deposited on glass, metal or polymer substrates. Light striking the dye excites electrons which are absorbed by the titania to become an electric current many times stronger than that found in natural photosynthesis in plants. Compared to conventional silicon based photovoltaic technology, Dyesol’s technology has lower cost and embodied energy in manufacture, it produces electricity more efficiently even in low light conditions and can be directly incorporated into buildings by replacing conventional glass panels or metal sheets rather than taking up roof or extra land area.
The Company – DYESOL Limited
Dyesol is located in Queanbeyan NSW (near Canberra) and in August 2005 was listed on the Australian Stock Exchange (ASX Code ‘DYEâ€). Dyesol manufactures and supplies a range of Dye Solar Cell products comprising equipment, chemicals, materials, components and related services to researchers and manufacturers of DSC. The Company is playing a key role in taking this third generation solar technology out of the laboratory and into the community.
More detail about the company and the technology can be found at:
http://www.dyesol.com
