10 February 2012

Proton Power Systems

SPECULATIVE BUY

Losses at fuel cells developer swelled from £2.4m to £2.8m last year

03/07/2009

German fuel cell specialist Proton Power is poised to make a significant step on the road to industrialising its product.

In order to serve the growing demand it claims to be experiencing, the company will in the second half of this year begin mass manufacture of its fuel cells ‘stacks’ and application-specific systems. Production capacity will gradually be increased up to 5,000 units per year.

CEO Thomas Melczer says the company needs to make around €15m to break even, which means selling about 300 stacks per year. In the year to December the company increased revenues by 65% to £1.1m, while losses swelled from £2.4m to £2.8m.

With a number of different projects under its belt, the company hopes their success will encourage follow-up orders. These projects include a passenger ferry to operate on Hamburg's Alster river that was one of the first times the technology has been applied in passenger vessels; a triple-hybrid electric bus in partnership with Skoda; a street-sweeping vehicle made with one of the world’s leading suppliers of municipal vehicles; and a prototype automatic power back-up unit.

The company raised £4m before expenses via two share placings at 10p during the year and Melczer says ‘we’re not running out of cash and we’re not burning so much money – we burned over the year the same as some companies do in a month’. Some £772,000 remained in the bank at the year end but in April, non-executive director and 54% shareholder Dr Faiz Nahab set up a £1.5m convertible loan for Proton through his Roundstone vehicle.

The lowly shares, floated at 80p in 2006, remain for risk-takers only.

Tags: AIM, Deals & contracts, Debt, Penny shares

Sector: Automobiles & Parts

Companies: Proton Power Systems

Market cap: £3.75m

PE Forecast: tbc

Share price: 5.25p

Subscribe today


Subscribe today and save 50%. Receive company watch recommendations and extensive company profile tips, released two months ahead of the market.

Sign up here

Spread Trading. New from Halifax Share Dealing

£100 credit when you open five trades within 60 days – terms apply. Spread Trading is not for everyone please ensure you understand the risks as you may lose more than your initial deposit. Click here for more information.

Institutional Investors in AIM 2011 - New Report

This unique study analyses the shareholdings of companies listed on AIM, extracting trends including rankings of the value and number of their investments.
Please click here to order your copy of the report or call 0207 250 7056.

Coverage of AIM, techMARK and PLUS Markets

Informative features and research on fast-growing companies, small-cap and growth stocks, penny shares, stock market tips and share recommendations, directors' dealings, company news and analysis, new issues and upcoming IPOs.

If you're interested in business tax updates visit our specialist tax guide website.

Share recommendations and small-cap stock picks

Small-cap and growth company share recommendations on AIM- and PLUS-listed companies. Latest analysts' stock tips and advice on which are the best shares to buy on London's junior stock markets.

Popular Recommendations

Latest Recommendations

Homeserve 08/02/2012

Home maintenance and emergency repairs concern Homeserve has warned that its reduction in customer numbers is 3% higher than expected.

Tags: Full list, Home repairs, Support services sector

Sector: Support Services

Companies: Homeserve

Low & Bonar 07/02/2012

Performance materials specialist Low & Bonar (LWB) reported a 26% rise in profits amidst considerable growth in its yarns business.

Tags: Increase in profits, Performance material specialist, Yarns business

Sector: Construction & Materials

Companies: Low and Bonar

Avon Rubber 02/02/2012

A trading update from gas masks to dairy products specialist Avon Rubber (AVON) has confirmed that it is on track to meet current-year expectations, but it is likely to be second half loaded.

Tags: Dairy products, Filter products, Main market, Masks, US DOD

Sector: Aerospace & Defence

Companies: Avon Rubber

More Recommendations

Sectors