IP : Applied Graphene Materials plc - Interim results for the six months ended 31 January 2020

Applied Graphene Materials, the producer of specialty graphene materials, is pleased to announce its interim results for the six months ended 31 January 2020.

Highlights

Operational highlights

Coatings:

• Significant progress during the period with a number of key mass market and industrial product launches re-enforcing customer momentum in core coatings market, highlights included:
  • Halfords launched instore and online sale of graphene primer in October 2019
    • Aerosol primer produces exceptional corrosion protection, due to Applied Graphene Materials ('AGM') graphene dispersion
  • James Briggs Ltd (JBL) launched Hycote graphene anti-corrosion primer in October 2019
    • Product for sale in mainstream market on Amazon and Tetrosyl Express
  • Alltimes Coatings Ltd launched Advantage Graphene liquid coating roofing system in August 2019
    • Significantly enhanced anti-corrosion performance delivered by incorporating AGM's graphene, includes unparalleled 30 year warranty
  • Blocksil launched Graphene enhanced Top Coat MT Product for harsh environment industrial applications demanding outstanding anti-corrosion protection in January 2020
  • Blocksil, has been specified for the supply of their product containing our graphene dispersions for a long-term refurbishment project for Avanti for its large industrial satellite communications structures.

Composites:

• Design, manufacture and demonstration of 10m carbon fibre forming tool incorporating graphene, suitable for advanced fibre placement methods for aerospace and other high volume manufacturing applications.
  • Cost effective solution incorporates graphene to enhance longevity in multi-component manufacturing, through increasing the toughness of the composite tooling material

Strategic highlights

• Strategic review completed with a focus on commercial momentum and cash conservation
• The strategic review established that Asia has potential to be a core market territory for AGM regarding graphene exploitation and commercialization
• Positive engagement with Beijing investor community in October 2019; ongoing COVID 19 has delayed follow up
• Resources aligned across business development and technical teams to support product development, rigorous testing and customer engagement
• Streamlining of manufacturing operations to focus on dispersion capabilities
• Company's cash run-way extended until at least Q4 2021

COVID 19

Continuing operationally in a manner to maximise the safety of our team members and maintain business continuity. Activity at our customers is being monitored and we continue to work with them to maintain progress as circumstances will allow in the coming months.

Financial overview

• REVENUE
  • Revenue of £35,000 (2019: £26,000)
  • Strong sales in February 2020
  • YTD revenues are £60,000 - 20% higher than the total for the year ended 31 July 2019 of £50,000
• EBITDA* - Loss of £1.9 million (2019: loss of £2.2 million)
• Loss before tax - £2.3 million (2019: loss of £2.4 million)
• Cash at bank - £4.3 million (2019: £8.2 million)
• Basic EPS - Loss of 4.0 pence per share (2019: loss of 4.4 pence)

* EBITDA comprises loss on ordinary activities before interest, tax, exceptional costs, depreciation and amortisation.

Adrian Potts, Chief Executive Officer, said:

'I am pleased that AGM has continued to make good progress in converting customer engagement into product launches, with several applications launched in the period that are now available to retail as well as specialist industrial customers. Our progress continues to be underpinned by AGM's industry-leading know-how in graphene dispersion and application. We are building an ever-increasing bank of supporting data that will help us accelerate customer application and testing, while the standardisation of a number of our graphene products will also make our material more acceptable to a broader customer base. Our focus remains on helping our customers realise the significant commercial potential the incorporation of graphene can offer them. We are confident that our pipeline of engagements is moving progressively towards further product launches and growing revenues in the near-term, with these successes expected to come primarily from our focus area of paints and coatings.

'Our year to date sales already exceed last year's total sales by 20%, and the business is in a strong position to support further progress, with net cash of £4.3m at 31 January 2020, and ongoing cash operating costs reduced by 23% as a result of our realignment in October. We are closely monitoring the COVID-19 pandemic and we have taken the appropriate precautions to keep our employees safe. We intend to operate and support our client engagements as much as we can, whilst following governmental guidelines.'

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

Applied Graphene Materials' results presentation, with audio commentary, is expected to be made available on its website at http://www.appliedgraphenematerials.com in due course.

For further information, please contact:

Applied Graphene Materials	[phone]
Adrian Potts, Chief Executive Officer David Blain, Chief Financial Officer
N+1 Singer	[phone]
Peter Steel/ Justin McKeegan
Hudson Sandler	[phone]
Charlie Jack / Emily Dillon

Notes to Editors

Applied Graphene Materials works in partnership with its customers using its knowledge and expertise to provide bespoke graphene dispersions and formats to deliver enhancements and benefits for a wide range of applications. The Group's strategy is to target commercial applications in three core markets: coatings, composites and functional materials.

The Group has developed proprietary bottom-up processes which are capable of producing high purity graphene nanoplatelets using a continuous process. The manufacturing process is based on sustainable, readily available raw materials and therefore does not rely on the supply of graphite, unlike a number of other graphene production techniques. Applied Graphene Materials owns the intellectual property and know-how behind this process.

Applied Graphene Materials was founded by Professor Karl Coleman in 2010 with its operations and processes based on technology that he initially developed at Durham University. The Group was admitted to AIM in November 2013, raising £11 million, and is based at the Wilton Site on Teesside. In January 2016 the Group raised £8.5m to support its ongoing activities and in October 2017 the Group raised a further £9.8m.