TIDMGELN
RNS Number : 5130W
Gelion PLC
12 December 2023
12 December 2023
Gelion plc
("Gelion" or the "Company")
Final results to 30 June 2023
Solid progress against our roadmap to commercialisation,
delivering on major milestones
Gelion plc (AIM: GELN), the Anglo-Australian energy storage
innovator, announces its audited final results for the year ended
30 June 2023.
FY23 Operational highlights
- Acquired a lithium battery IP portfolio from Johnson Matthey for
a net consideration of GBP3.0m to accelerate the development Lithium-Sulfur
(Li-S) technology.
- John Wood appointed as CEO in November 2022, a battery, clean-tech
and innovation specialist, bringing over 30 years of significant
commercial and manufacturing expertise and C-Suite experience.
- Manufactured 1,200 zinc-bromide cells from our pilot manufacturing
line, and migrated to a zinc hybrid technology.
FY23 Financial highlights
- Total income (R&D tax incentives) for the year of GBP2.1m, 17%
ahead of market expectations(1) .
- Adjusted EBITDA(2) loss of GBP5.9m, 8% lower than the market expectations(1)
.
- Implemented cost control measures (in H2 23) resulting in estimated
annualised cost savings of GBP1m.
- Well capitalised with cash and cash equivalents on the balance
sheet of GBP7.3m and nil debt as at 30 June 2023.
Post period highlights
- In July 2023, the Group identified a path towards the development
of a zinc-based solution, following the successful match-to-market
study and the Group is now developing a zinc hybrid cell.
- Signed agreements with the University of Sydney and Professor
Yuan Chen for Gelion's Advanced Cathode Project, accelerating
progress towards a zinc-based energy storage solution. Gelion
expects to validate the potential of this technology in Q1 2024.
- Raised GBP4.1 million via a placing, subscription and retail offer
in November 2023, demonstrating support from existing and new
investors.
- Successful acquisition of OXLiD Ltd, a UK based Li-S battery technology
developer to accelerate progress towards commercialisation and
position Gelion as a global leader in this expanding market.
- Signed JDA with Ionblox, a US silicon oxide anode developer, to
develop high performance, next-generation LiSiS cells, initially
for the global electric vehicle (EV), electrical vertical-takeoff-and-landing
(eVTOL) and drone markets, before progressing to the stationary
energy storage market.
- New Li-S Research and Development facility now fully operational,
to optimise development and accelerate market readiness of this
technology by producing more advanced cell prototypes.
(1) Analyst estimates - total income - GBP1.7 million and
Adjusted EBITDA loss of GBP6.4m
(2) Excludes non-recurring expenses such as net loss on sales of
fixed assets, transaction costs, listing and other associated costs
and share based payments. These costs are either considered
non-recurring or are non-cash items and therefore are separately
disclosed to assist the user of the financial information to
understand and compare the underlying results of the Company.
John Wood, CEO of Gelion , commented: " We made solid progress
during the year against our roadmap to commercialisation where the
Group delivered major milestones on both the Li-S and zinc battery
technologies. With a strong team of experts, Gelion has unique
technical capabilities and we have now identified where the
business needs to focus to become a global leader in the provision
of safe, robust, and scalable energy storage solutions with
real-world impacts.
"We have started H1 FY24 in a robust position with momentum
toward LiS leadership coming out of the acquisition of OXLiD in the
UK, and the joint development agreement with leading SiOx anode
partner Ionblox in the US. Our Zinc team continued the development
of our hybrid cell that is designed to be readily scalable. With a
good financial footing and strong underlying market drivers as
clean technologies are increasingly recognised as fundamental to
the transition to a green economy, I am confident that we will
achieve success for both of our technologies, with Gelion playing a
significant role in providing relevant energy storage
solutions."
For further information please visit www.gelion.com or
contact:
Gelion plc via Alma
John Wood, CEO
Amit Gupta, CFO
Thomas Maschmeyer, Founder and Principal
Technology Advisor
Cavendish Securities plc (Nominated Adviser
and Sole Broker)
Corporate Finance
Neil McDonald
Seamus Fricker
Fergus Sullivan
ECM
Barney Hayward +44 207 220 0500
Alma Strategic Communications +44 20 3405 0205
Justine James gelion@almastrategic.com
Hannah Campbell
Will Ellis Hancock
About Gelion
Gelion ("gel: ion") is a global -energy storage innovator,
supporting the transition to a more sustainable economy by
commercialising two globally important next generation
technologies: Lithium-Sulfur (LiS) and Zinc-based (Zn) hybrid cells
to electrify mobile and stationary applications. Gelion plc (the
Group) is listed on the London Stock Exchange's Alternative
Investment Market and wholly owns Australia based Gelion
Technologies Pty Ltd. Gelion is designing and delivering innovative
battery technology to enable that transition and return value for
its customers and investors.
Lithium Sulfur
Gelion's effort is directed at the potential for the LiS
chemistry to deliver double the gravimetric energy density of
standard Lithium-ion chemistries whilst at the same time reducing
cost and increasing safety targeting the EV and e-aviation market,
helping to make global transport, energy consumption and storage
more sustainable.
Gelion is developing a product for its high energy density
sulfur cathode at its expanded R&D facilities in Sydney,
enabling it to integrate with a variety of anodes ranging from
graphite to silicon to lithium metal, depending on the targeted
application.
Gelion recently also expanded in the UK by acquiring OXLiD Ltd,
significantly increasing Gelion's capability in cathode improvement
thereby accelerating path to commercial partners and
commercialisation.
Zinc
Gelion is adapting its zinc technology to comprise an alternate
cathode technology, a zinc hybrid cell to develop complementary
next-generation batteries for the lead-acid eco-system. Early
testing indicates that this solution has the potential to maintain
good energy density levels with enhanced cost and safety aspects.
Once fully developed, Gelion intends for our zinc technology to
provide a durable and sustainable market extension within the
ecosystem that supports lead-acid batteries.
Chairman's Statement
Overview
FY23 was another year of strategic progress for Gelion, where we
made significant advancements and achieved key milestones towards
commercialising our next generation battery technologies. We are
beginning to experience good traction on both the Lithium Sulfur
and zinc hybrid cells technologies, a testament to the efforts made
throughout the year. The Board has been actively engaged to ensure
we have the right leadership in place and we are now 12 months into
the tenure of our CEO, John Wood, and we are seeing the outcomes of
his revised strategy with greatly strengthened IP and an
accelerated route to market. I am confident that Gelion will be
able to fast-track the development and commercialisation of our
Li-S and Zinc based technologies, achieved in conjunction with our
strategic partners.
The Company's commitment to global leadership was reinforced by
strategic acquisitions, notably the IP portfolio from Johnson
Matthey and Oxis Energy and The University of Sydney (USyd) IP,
solidifying our standing in Lithium Sulfur (Li-S) technology. Li-S
is a potential next generation of Lithium batteries with
approximately twice the energy density of current incumbent
commercial lithium-ion technology. Similarly, the pilot production
of Gen 4 zinc-bromide cells and the match-to-market analysis,
identified the applications best suited for the technology and a
market ready to be targeted.
The aim to become a global leader in Li-S battery technology has
already been reinforced in H1 24 by:
- The GBP4.1m fundraise and the recent acquisition of OXLiD
Ltd, a UK based Li-S battery technology developer and the
provision of a UK footprint for Gelion as well as the addition
of OXLiD's six highly skilled scientists.
- The joint development agreement (JDA) with Ionblox Inc., a
US based silicon oxide anode developer.
These strategic steps have been taken to accelerate progress
towards commercialisation, position Gelion at the forefront of this
expanding market and demonstrate the continued progress the Group
is making. The above advancements, coupled with our focus on
establishing ourselves as a leading provider of safe, robust, and
scalable renewable energy storage solutions, underscore Gelion's
commitment to addressing the pressing global need for sustainable
energy solutions. These successes could not be achieved without our
passionate team, and as a Board, we are privileged to have
attracted a high-performing, dedicated team of seasoned
professionals in commercial, science and engineering disciplines,
who are guided by our leaders.
Strategy
Gelion remains committed to delivering long-term value to our
stakeholders through the development of its cutting-edge battery
technologies, that will be of critical importance to the world of
tomorrow. A key focus for our CEO, John, since his arrival in
November 2022 has been to understand how best to achieve this
commitment and has resulted in the evolution of the Group's
strategy.
In terms of our Zinc technology, we are confident that the
migration of our Zinc technology path (from zinc-bromide) will lead
to the manufacturing of safer, more cost-effective solutions, with
energy densities that will make them suitable for applications in
the existing lead-acid ecosystem. Satisfying all three requirements
is extremely rare and we are confident that this will set us apart
from other players in the market and make our solution highly
desirable, enabling us to compete directly with lead-acid
incumbents.
The awareness around the benefits of Li-S batteries and their
improved performance is already large and continuing to grow. Li-S
is going to be fundamental in the enhancement of the next
generation of batteries for electric mobility and as such, it has
the potential to power the future of transport. Gelion's existing
IP portfolio combined with the post period end OXLiD acquisition
and the JDA with Ionblox means Gelion is already a global player
with presence in Australia, the UK and the US. Furthermore, the
Group is in a fantastic position to begin to test and subsequently
evidence the effectiveness of its solutions to industry players, a
crucial stage in the development of any technology.
While this shift in Gelion's commercialisation approach will
require time and investment, the Board is confident this approach
will provide the fastest pathway to commercialisation.
Market opportunity
Global demand for energy storage solutions continues to grow
exponentially, supported by the implementation of government
policies aimed towards achieving net-zero commitments. The global
battery market share of Li-S technologies is expected to grow
significantly in the coming years, driven by their high performance
and the continuing acceleration in demand for batteries, a market
our technologies will be able to be sold directly into.
Our match to market analysis identified that Gelion's zinc-based
technologies are well-matched to performance requirements for many
traditional lead- acid battery applications. While representing a
smaller market than lithium technologies, the global lead-acid
market is still substantial and growing, presenting significant
opportunity for Gelion, with our zinc-based technologies offering
several key competitive advantages over well entrenched lead-acid
batteries.
The opportunities for Gelion are expanding and the storage
solutions we are developing will be pivotal to the lead-acid and
lithium-ion storage market transformations.
The Board / Our people
At Gelion, our diverse and dedicated team is instrumental in
achieving our goal of a greener, cleaner future. Under John's
leadership, our team is energized and motivated, guided by our core
values: Environmental consciousness, cutting-edge innovation, a
scientific ethos, realism and a clear vision of where and how
shareholder value can be created.
Our people, from senior leadership to every team member, embody
these values and drive our success. Cementing our reputation as an
employer of choice, we have continued to recruit some of the
sharpest business and scientific minds, who continuously add key
contributions to our story.
I am delighted to say that post period end, we have welcomed
Louis Adriaenssens to our team. Louis brings considerable battery
experience and was most recently the supervisor of chemistry at the
Panasonic lithium-ion plant at the Tesla Gigafactory. Louis'
appointment comes at the right time for Gelion, as we take further
steps towards commercialisation.
ESG
We take our responsibility to successfully transition to a
sustainable economy seriously and we expect to be playing a key
role by developing low-impact and safe technologies. Both of our
energy storage platforms are comprised of abundant materials,
contributing towards a low environmental impact, sustainability,
and recyclability.
In Gelion's organisational structure, internal governance
processes are not isolated components but are intricately
integrated into the overarching business strategy ensuring that the
Group consistently adheres to all pertinent laws and regulations.
To bolster this commitment to good governance, Gelion has adopted
the Quoted Companies Alliance Corporate Governance Code (QCA Code),
a framework consisting of 10 guiding principles.
Summary and outlook
As Gelion moves forward, our technologies are aimed at driving
the green energy transition. Our progress in Lithium Sulfur and
zinc-based hybrid cells positions us to make a tangible impact. We
remain cognisant of the wider macroeconomic climate and have taken
prudent steps to manage our cost base and maintain the financial
health the Company.
As the Group continues to execute against the clearly defined
strategy laid out by John since his arrival, we take further steps
towards building shareholder value. With a clear strategy, a team
with domain experience, and innovative products, we look to the
future with confidence in building shareholder value.
Dr Steve Mahon
Chairman
12 December 2023
Chief Executive Officer's Statement
Introduction
It gives me great pleasure to present my first full year
financial results statement as CEO of Gelion. H1 FY23 saw Gelion
deliver several milestones, including the pilot production of
zinc-bromide batteries in a commercial partner setting in Sydney,
and progressive advancements in the development of lithium-sulfur
(Li-S) additive and electrolyte technologies.
Since my appointment in November 2022, my primary focus has been
on the identification and prioritisation of development pathways
that will enable the Group to deliver commercially viable and
scalable, next-generation battery chemistries.
This involved extensive planning, fostering team development,
with a particular focus on rigorous market analysis and a
comprehensive assessment of both of our technologies relative to a
rapidly evolving global landscape, enabling the identification of
potential routes for their pervasive adoption. This work has
significantly influenced the Group's current strategic and
commercialisation approaches, and has reinforced my view that
Gelion is on the right track to deliver pioneering, cutting-edge
technologies that will underpin the company's goal of establishing
a leading position in the highly competitive energy storage
sector.
A primary motivation for me to join Gelion was the opportunity
to collaborate with Professor Thomas Maschmeyer, an extraordinary
scientist who established the company, offering truly innovative
technological solutions, and the exceptional team of highly
talented and dedicated employees that has formed around him.
It is incredibly motivating to lead the Gelion team in our
shared mission to deliver value to our shareholders by bringing our
two globally significant next-generation technologies to
market.
Technology overview
The first technology, based on combinations of Lithium (Li) and
Sulfur (S), yields very high gravimetric energy densities, and the
second uses Zinc (Zn) in combination with our new cathode
technology to yield robust, long-life storage solutions. Together,
we believe these technologies will play a pivotal role in
facilitating the global transition toward sustainable energy
solutions for both mobile and stationary storage applications.
Gelion has clearly defined objectives to establish itself as a
company of global relevance in both technologies and in FY23, the
Group made crucial steps towards achieving these goals.
Lithium Sulfur
To accelerate our Li-S effort, Gelion acquired a lithium IP
portfolio from Johnson Matthey. This will help us advance the
development of our Li-S technology on a path that is intended to be
compatible with a variety of lithium anode materials, including
those based on mostly either graphite, silicon, silicon oxide or
lithium metal.
Zinc
To enhance the cost-efficiency and adoption potential of our
Zinc technology, we have realigned our focus toward the development
of a next-generation zinc-based hybrid cell. This innovative
approach is designed to complement the existing lead-acid
ecosystem, to fit within existing battery standards, and to
capitalise on the technological advancements and insights gained
from our earlier zinc-bromide research program, thereby lowering
barriers to adoption.
Post-period end
The new financial year has commenced on a robust note, marked by
a successful fundraise of approximately GBP4.1m and subsequent
acquisition of OXLiD Ltd, a UK based Li-S battery technology
developer. This strategic acquisition serves to accelerate progress
towards commercialisation and to underpin Gelion's move towards a
global leadership position in this expanding market.
In our Zinc technology, we recently signed two agreements with
The University of Sydney and Professor Yuan Chen for Gelion's
Advanced Cathode Project, facilitating progress towards our
zinc-based energy storage solution and we expect to validate the
potential of this technology by Q1 2024.
We have also announced the joint development agreement (JDA)
with Ionblox Inc., a US based silicon oxide anode developer. Gelion
and Ionblox will jointly aim to develop high performance,
next-generation LiSiS cells, initially for the global electric
vehicle (EV), electrical vertical-takeoff-and-landing (eVTOL) and
drone markets, before progressing to the stationary energy storage
market.
Our operational achievements in FY23 have set a solid
foundation, and we are witnessing this momentum rolling over into
the new fiscal year coupled with continued strong customer interest
in our technologies.
On top of the Ionblox agreement, we are working towards
developing a range of strategic partnerships that will assist in
fast-tracking our commercialisation path, while supporting the
Board's confidence in the Group's ability to deliver long-term
growth.
Evolution of our strategy
Li-S Batteries
Based on the very high gravimetric energy densities, Li-S-based
energy storage continues to be elevated in the industry as its
enormous potential in the mobility markets becomes widely
understood.
Our extensive network across the industry will be key to our
ability to establish the required supply chains and commercialise
our products, while we expand and mature as a participant in the
global community.
The technology has historically been held back by challenges
including the poor conductivity of sulfur, which results in limited
charging rates, and low cycle life associated with the so-called
"polysulfide shuttle". There is growing confidence within the
industry that viable solutions to overcome these key challenges
have been identified.
In H2 FY23, we acquired the Li-S battery patent portfolio from
Johnson Matthey (including solid and liquid electrolytes,
disordered rock salt, electrode formulation and battery materials
recycling) for a net cost of GBP3.0 million (gross cost of GBP4.25
million less sale of non-core IP portfolio for GBP1.2 million).
This acquisition is of significant strategic importance to the
business and is facilitating the acceleration of our technology
development. The IP portfolio includes more than 350 patents across
65 patent families as well as development programs, technology
transfer packages, market and portfolio analyses, manufacturing
design and cost models for our Li-S technology.
We are encouraged by the progress being made toward realising
the potential of this IP when combined with Gelion's existing
technologies. As a result, we have now expanded the testing
capacity of our research and development facilities by 50% to
ensure we can optimise development and accelerate market readiness
of this technology. Based in Sydney, the site has the capability to
increase Gelion's prototyping toward cell development and the
progressive commissioning of the capability commenced in October
2023.
Although the market for new battery technologies is very
competitive and both our zinc hybrid and Li-S cell technologies
have, and will continue to have, competition from other energy
storage innovators aiming at similar performance and market
segments, we are confident in our strategy leading to market
impact.
In that context, Gelion is developing and securing IP with the
objective of establishing freedom-to-operate and a protective
buffer around our technology to prevent infringement and to retain
our competitive advantage. We are also growing our team of
technology experts and partnering to maximise our IP advantage and
opportunity for success. This is perfectly illustrated by our
recent acquisition of OXLiD.
Zinc-based energy storage
Zinc is a very important battery element, primarily owing to its
abundance, non-toxic nature, and cost-effectiveness. Since joining
Gelion, a key priority has been to align our exceptional
technological capabilities with consumer expectations. From this
process (started in March 2023), we concluded that to commercialise
our zinc-bromide technology we would need to overcome significant
challenges around safety under forcing conditions (e.g., external
temperatures above 130 C) and associated regulation.
Based on these insights, we initiated the 12-month zinc-bromide
research (R&D) programme. Building on the progress we had made
already, we realised that by adjusting our technology direction
away from bromide towards a hybrid chemistry target there are paths
to both lower cost (increased competitiveness), and easier scaling
(earlier achievement of safety and regulation compliance
validation) referred to as Gen5 hybrid technology. These elements
receive further strength because of their compatibility with
existing global supply chains.
This hybrid Gen5 cell is designed to deliver features highly
sought after in the market, including robustness, wide temperature
tolerance, adaptability to a broad range of state-of-charge levels,
and the ability to be stored and transported in a discharged
state.
Nonetheless, technology risk remains until we achieve a
sufficient level of development and testing. Battery science is
complex, with all aspects and components of the cell (e.g., anode,
cathode, and electrolyte) impacting each other.
Therefore, any alterations in the design elements require a
re-evaluation of all advancements. Consequently, we are reviewing
carefully before accelerating. We anticipate validating the
potential of this technology by Q1 2024 and will provide a
comprehensive update to our shareholders consistent with the
previously communicated timelines for the current programme.
Acquisition of OXLiD
With our clearly defined ambition to grow rapidly into a company
with a global profile we are delighted to have concluded the
strategic acquisition of OXLiD in November 2023, which delivers a
significant increase in capability, a UK footprint and accelerates
our path in the commercialisation of Li-S technology. The UK and
European battery technology market presents a growing opportunity
for the Group. The UK government is supporting battery science
development; stewardship of the academic technology effort is being
led by the Faraday Institution (https://www.faraday.ac.uk/faraday-
battery-challenge/) and its Li-S focused consortium LiSTAR.
Adding the acquisition of OXLiD to our Johnson Matthey IP
acquisition gives Gelion a strong opportunity to work within the UK
research and industry community, expand our network of contacts,
and strengthen our overall position in the UK market. Modern
technology and supply chain development is now best achieved by
establishing global reach, while utilising local regional
incentives.
JDA with Ionblox
We signed the JDA with Ionblox in November, with the aim to
deliver safe, high-energy density, lower cost lithium silicon
sulfur (LiSiS) cells for the global electric vehicle (EV),
electrical vertical-takeoff- and-landing (eVTOL) and drone markets,
before progressing to the stationary energy storage market.
The EV and eVTOL industries are in need of highly competitive
next-generation battery technologies to underpin the transition to
net-zero emissions. The International Energy Agency estimates that
approximately 300 million EVs will be required by 2030, compared
with 10 million EVs in 2022, a 2900% increase. Technologies the
ones we will jointly be developing, will be integral to servicing
this exponential increase in demand.
Summary and Outlook
We made good progress during FY23 against our roadmap to
commercialisation, covering the strategic lithium battery IP
portfolio acquisition, expansion of the Li-S R&D facility,
pivoting from zinc-bromide to a zinc-based hybrid cell solution,
and further collaboration with the University of Sydney.
We have started H1 FY24 in a strong position with:
- the development toward a zinc hybrid cell that is designed
to be readily scalable and to deliver features important
to the market. We intend to update further on the progress
and the validation of our zinc hybrid technology and preparations
for market readiness during Q1 2024;
- the recently completed expansion of our R&D laboratory for
our Li-S technology;
- the successful acquisition of OXLiD;
- GBP4.1m capital raise demonstrating support of our existing
and new investors;
- JDA with Ionblox in the US, which will enable Gelion to
produce lithium silicon sulfur batteries
- a strong focus on strategic relationships including ongoing
discussions toward important partnerships to further accelerate
our path.
It is in the combination of these factors that success and
delivery of value to our stakeholders and customers will be found.
I am highly optimistic for the future of our business.
I am also confident that we will achieve success for both of our
technologies, with Gelion playing a significant role in providing
relevant energy storage solutions as the world continues its
transition to cleaner energy.
We are very grateful for what we have been able to accomplish
with your help and support but are even more excited about what the
future holds. I therefore thank you again for your investment in
Gelion and look forward to reporting positive developments in
2024.
John Wood
CEO
12 December 2023
Chief Financial Officer's Review
Overview
FY23 was another busy year for Gelion, a year filled with
accomplishments, inorganic activities, strategic reflection and
direction and realignment of priorities.
In FY23, we invested in our people, primarily scientists,
chemical and mechanical engineers, further strengthening our human
capital to drive innovation towards commercialisation,
manufacturing at pilot scale, and growing our IP moat to further
establish our market-leading position in the global Li-S battery
ecosystem.
Despite the significant macroeconomic challenges in FY23, we
have successfully accomplished product development while
maintaining the cost base within original plans. These challenges
continue and the Group has been proactive in reducing discretionary
expenditure to ensure efficient capital deployment.
Li-S technology
The Group made huge strides in progressing our Li-S technology
ahead of original plans, facilitated by the strategically important
acquisition of the Johnson Matthey/Oxis Energy IP portfolio in
March 2023 for GBP3.0m (net costs post sale of the silicon anode IP
and exclusive licence back for Li-S technology), placing Gelion
among the top global players in the Li-S battery market.
This IP portfolio potentially also provides additional
commercialisation opportunities (development or licensing), in the
areas of lithium battery recycling and alternative electrode
technologies. It was identified that quick action was required to
exploit the IP and, therefore, decided to expand the R&D
capability of the team by increasing team members and facilities
which became operational in September 2023.
Post year-end, we also acquired OXLiD Ltd, a UK based Li-S
business with roots back to Oxis Energy, to target the Europe and
UK market while doubling our effort to achieve technical milestones
to target our near-term target applications. The acquisition was
for a total consideration of approximately GBP4.2m (GBP1.25m cash
on completion, GBP0.4m deferred cash consideration and GBP2.5m in
shares escrowed for 18 months) and was funded from the recently
concluded capital raise of GBP4.1m in November 2023.
We recently also signed a JDA with the US based Ionblox Inc., a
leader of silicon oxide anode developer with an aim to develop
lithium silicon-sulfur batteries.
Zinc-based energy storage solution
Our primary focus during the past year has been on advancing our
zinc battery solution. We successfully set up the pilot facility
and manufactured 1,200 zinc-bromide batteries. Rigorous testing of
these batteries and validation processes have provided critical
insights, which resulted in Gelion choosing to pivot to the Gen5
zinc hybrid cell (bromine free). This technology will incorporate
learnings from the past eight years into a new system design, which
the Group expects will result in development efficiencies to help
achieve improved cell performance against the metrics of cost,
safety, and performance.
We recognise the importance of collaboration in a dynamic and
competitive industry and, as a result, have developed further
partnerships with the University of Sydney to assist in the Gen5
zinc hybrid battery research. The board believes this will not only
validate the viability of Gelion's technology, but also open doors
to future product development collaborations from suppliers and
other like stakeholders. We are actively working on translating our
innovative solutions into market- ready products. Our strategy
involves carefully targeted product launches and pilot programs to
validate market demand and gather valuable customer feedback.
This was achieved whilst maintaining a focus on value creation
and strategic growth. As part of the Company's commitment to
enhancing shareholder value and ensuring long-term financial
resilience, from March 2023 efforts have been made to pursue
initiatives to manage costs whilst continuing to deliver solutions
that the world really needs.
Focused cost saving efforts
Balancing efficiency and innovation
Our cost control measures have been thoughtfully implemented to
strike a balance between maximising efficiency and fostering
innovation. These measures resulted in annualised cost savings of
c. GBP1.0m across staff, consultants, and other overheads. By
streamlining certain processes and optimising resource allocation,
we have remained steadfast in our commitment to invest in research
and development, ensuring that we continue to innovate and, at the
right time, offer cutting-edge products to our customers.
Prioritising sustainable savings
Our approach to cost control is rooted in sustainability. While
certain savings reflect a temporary reduction in costs, which were
important to be undertaken to match the Group's current needs and
development status, we have also made efforts to identify and
address areas where costs can be reduced without compromising the
quality and integrity of our offerings. These efforts have not only
yielded immediate financial benefits and reduced cash burn but have
also positioned us for sustainable growth over the long term.
This disciplined approach has allowed us to redirect resources
towards high-impact projects that align with our strategic goals;
for example, IP portfolio management, fostering a more agile and
competitive organisation.
In conclusion, our commitment to cost control is a pivotal
aspect of our overall financial strategy. While our efforts to date
have resulted in immediate improvement in cash burn, they are
underpinned by a broader vision of sustainable growth, innovation,
and value creation. It is the board's belief that by striking the
right balance between managing costs and strategic investments, we
will be well-positioned to navigate dynamic market environments and
deliver sustainable returns to our valued investors.
Financial highlights
Income statement
Total income for the year ended 30 June 2023 was GBP2.1m (2022:
GBP1.7m) primarily from R&D tax incentives resulting from the
ongoing development programmes of the business for both
technologies.
Adjusted EBITDA loss (defined as the Earnings Before Interest,
Tax, Depreciation, Amortisation, listing and other non-recurring
costs and share based payment charges), increased to GBP5.9m (2022:
GBP4.1m) reflecting FY23 being the first full year post listing.
Refer to the note 25 to the financial statement for a
reconciliation to IFRS measures.
Operating losses before non-recurring items and share based
payments expense increased to GBP6.4m (2022: GBP4.4m) primarily due
to:
- GBP1.2m increase in research and development spend, a significant
proportion of which relates to staff costs resulting from
the increase in the average number of R&D staff from 26
in FY22 to
36 in FY23 and pilot manufacturing project
- GBP1.0m increase in administrative costs reflecting additional
costs of being a public company
- partially offset by an increase in other income
Statement of financial position and cash flows
At 30 June 2023, current assets amounted to GBP9.4m (2022:
GBP19.2m), including cash and cash equivalents and term deposits of
GBP7.3m (2022: GBP17.0m) primarily driven by:
- operating cash outflow of GBP6.0m (2022: GBP5.3m); and
- IP acquisition and management expenses of GBP3.0m (2022:
GBP0.05m), property, plant, and equipment of GBP0.5m (2022:
GBP0.7m) largely relating to the commissioning of the pilot
manufacturing plant and other lab equipment
Research and development
Research and Development continues to form a material part of
the Group's activity this year, with a significant portion relating
to pilot manufacturing of our zinc-bromide battery. The Group
expensed most of its development costs of GBP4.1m for the year
(2022: GBP3.0m). The Group had qualifying research and development
costs against which it expects to receive the R&D tax
incentives of GBP2.05m from the Australian Taxation Office.
Foreign currency exposure
The Group currently does not face any significant currency
exposure; however, it does expect this to increase in the future as
exposure to both foreign currency translation risk and transaction
risk increases resulting from plans to scale. A large majority of
the Group operating overheads are in Australian dollars whereas
procurement of materials and equipment are in other foreign
currencies.
We have signed a FX hedging contract with a financial
institution however there weren't any outstanding hedging contracts
as of June 2023. The Group expects to maintain a natural hedge to
transactional exposure by invoicing in foreign currencies where
appropriate to minimise the
Outlook
Over the past year, we have faced both challenges and
opportunities, and I am proud to say that we have not only
navigated these waters successfully but have also made significant
strides toward our strategic goals.
While innovation remains a cornerstone of our Group's strategy,
we are conscious of the fact the industry is changing rapidly, and
strategic moves need to be made to shorten the time to market. As
such, we not only continued to invest in research and development,
but we also acquired global patent portfolios and OXLiD to enable
us to capitalise on the Li-S momentum. The Board believes our
prospects remain promising as our internal development and
inorganic activities have placed Gelion at the forefront of this
rapidly evolving industry while managing risk, reward, and
efficient use of shareholder funds at the same time.
Our research indicates the adoption of renewable energy sources
is accelerating, creating a higher demand for reliable energy
storage solutions. With governments and businesses alike committing
to ambitious sustainability targets, we are poised to capitalise on
this trend. Our pipeline of innovative products is robust, and we
are committed to bringing these advancements to market in a timely
manner.
Our technologies aim to cater to both mobile and stationary
storage applications and our strategy specifically targets markets
and opportunities that Gelion can pursue in the near term and then
expand into in the medium to long term.
We extend our gratitude to our shareholders, partners, and
employees for their unwavering support as we embark on this
exciting journey towards a more sustainable energy future.
Amit Gupta
CFO
12 December 2023
Consolidated Statement of Comprehensive Income
Year ended 30 June
Notes 2023 2022
GBP'000 GBP'000
Other income 4 2,054 1,745
Total income 2,054 1,745
Administrative expenses (3,841) (2,847)
Research and development expenses (4,147) (2,970)
Share-based payments expense (894) (49)
Depreciation and amortisation (463) (308)
========================================================== ====== ========== =========
Operating loss before non-recurring items 6 (7,291) (4,429)
Non-recurring items: 5
Listing and other associated costs - (4,658)
Loss on sale of assets (186) -
Advisory costs related to purchase and sale (80) -
of the IP
Total non-recurring items (266) (4,658)
Operating loss (7,557) (9,087)
Finance costs (3) (73)
Finance income 153 3
========================================================== ====== ========== =========
Loss on ordinary activities before taxation (7,407) (9,157)
Tax on loss on ordinary activities 8 - -
========================================================== ====== ========== =========
Loss on ordinary activities after taxation (7,407) (9,157)
========================================================== ====== ========== =========
Total loss for the year attributable to equity holders of the parent
Other comprehensive income:
Items that may be reclassified to profit
or loss
* Exchange gains/(losses) arising on translation of
foreign operations 9 (695) 713
========================================================== ====== ========== =========
Total comprehensive loss for the year attributable
to equity holders of the parent (8,102) (8,444)
========================================================== ====== ========== =========
Loss per share (basic and diluted) attributable
to the equity holders (pence) 11 (6.90) (9.20)
========================================================== ====== ========== =========
The above results relate entirely to continuing activities.
There were no acquisitions or disposals of businesses in the
period.
The accompanying notes form part of this financial
information.
Consolidated Balance Sheet
As at 30 June
Notes 2023 2022
GBP'000 GBP'000
Assets
Non-current assets
Intangible assets 12 3,349 362
Property, plant and equipment 13 957 1,050
Current assets
Cash and cash equivalents 15 7,268 16,024
Short-term investments 16 - 1,017
Other receivables 16 2,114 2,153
==================================== ======= ========= =========
Total Assets 13,688 20,606
==================================== ======= ========= =========
Liabilities
Current liabilities
Trade and other payables 14, 17 1,057 854
Non-current liabilities
Trade and other payables 14, 17 27 31
==================================== ======= ========= =========
Total liabilities 1,084 885
==================================== ======= ========= =========
Net assets 12,604 19,721
==================================== ======= ========= =========
Equity
Issued capital 18 108 107
Share premium account 18 20,752 20,662
Other non-distributable reserves 18 5,328 5,148
Capital reduction reserve 18 11,194 11,194
Accumulated losses (24,778) (17,390)
==================================== ======= ========= =========
Total equity 12,604 19,721
==================================== ======= ========= =========
The financial statements of Gelion Plc, company registration
number 09796512, were approved by the Directors and authorised for
issue on 12 December 2023.
The accompanying notes form part of this financial
information.
Consolidated Statement of Cash Flows
Year ended 30 June
Notes 2023 2022
GBP'000 (Restated)
GBP'000
Cash flow from operating activities
Loss for the year before exchange losses (7,407) (9,157)
Adjustments for:
* depreciation 409 296
* amortisation 54 12
(147) -
* net finance loss / (income)
* loss on disposal of property, plant and equipment 127 8
48 -
* impairment of intangible assets
* share-based payments expense 894 3,902
Changes in operating assets/liabilities
* Decrease / (increase) in receivables 24 (740)
* Decrease / (increase) in prepayments 15 (162)
* Increase / (decrease) in payables (45) 507
=============================================================== ====== ========= ============
Net cash used in operating activities* (6,028) (5,334)
Cash flows from investing activities
Purchase of intangible assets (3,982) (48)
Sale of intangible assets 1,189 -
Purchase of tangible property, plant and
equipment (456) (733)
Short-term investments (term deposits) 1,017 (1,017)
Interest received 146 2
=============================================================== ====== ========= ============
Net cash used in investing activities (2,086) (1,796)
Cash flows from financing activities
Proceeds from issue of shares 18 16,222
Proceeds on issue of convertible loan
notes that were subsequently converted - 5,999
Transaction costs of issue of shares* - (1,541)
Repayment of leasing liabilities (46) (126)
=============================================================== ====== ========= ============
Net cash used in financing activities* (28) 20,554
Net increase/(decrease) in cash held (8,142) 13,424
Cash and cash equivalents at beginning
of financial year 16,024 1,913
Effect of exchange rate changes (614) 687
=============================================================== ====== ========= ============
Cash and cash equivalents at end of financial
year 15 7,268 16,024
=============================================================== ====== ========= ============
The accompanying notes form part of this financial
information.
* FY22 has been restated for transaction costs related to the
issue of shares, more details have been provided in the note 2.3
.
Consolidated Statement of Changes in Equity
Capital Other
Share Share Accumulated reduction non-distributable
capital premium losses reserve reserves Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 July
2021 33 11,251 (8,389) - 691 3,587
Loss on ordinary
activities after
taxation - - (9,157) - - (9,157)
Other comprehensive
income - - - - 713 713
========================= ========= ========= ============ =========== =================== ========
Total comprehensive
loss for the year - - (9,157) - 713 (8,444)
========================= ========= ========= ============ =========== =================== ========
Contributions by and distributions to owners:
Bonus issue 57 (57) - - - -
Capital reduction - (11,194) - 11,194 - -
Share-based payment
charge - - - - 3,902 3,902
Shares issued during
the period 11 16,032 - - - 16,043
Shares issued during
the period through
a convertible loan 6 5,993 - - - 5,999
Costs of shares
issued - (1,541) - - - (1,541)
Exercise of share
options - 178 158 - (158) 178
========================= ========= ========= ============ =========== =================== ========
Total contributions
by and distributions
to owners: 74 9,411 158 11,194 3,744 24,581
========================= ========= ========= ============ =========== =================== ========
Balance at 30 June
2022 107 20,662 (17,390) 11,194 5,148 19,721
========================= ========= ========= ============ =========== =================== ========
Balance at 1 July
2022 107 20,662 (17,390) 11,194 5,148 19,721
Loss on ordinary
activities after
taxation - - (7,407) - - (7,407)
Other comprehensive
income - - - - (695) (695)
========================= ========= ========= ============ =========== =================== ========
Total comprehensive
loss for the year - - (7,407) - (695) (8,102)
========================= ========= ========= ============ =========== =================== ========
Contributions by and distributions to owners:
Bonus issue - - - - - -
Capital reduction - - - - - -
Share-based payment
charge - - - - 894 894
Shares issued during
the period 1 73 - - - 74
Shares issued during - - - - - -
the period through
a convertible loan
Costs of shares - - - - - -
issued
Forfeited / cancelled
options - - 19 - (19) -
Exercise of share
options - 17 - - - 17
========================= ========= ========= ============ =========== =================== ========
Total contributions
by and distributions
to owners: 1 90 19 - 875 985
========================= ========= ========= ============ =========== =================== ========
Balance at 30 June
2023 108 20,752 (24,778) 11,194 5,328 12,604
========================= ========= ========= ============ =========== =================== ========
The accompanying notes form part of this financial
information.
Notes to The Consolidated Financial Statements
1. General Information
Gelion Plc ('Gelion' or the 'Company') is a 100% owner of an
Australian subsidiary that conducts research and development in
respect of an innovative battery system and associated industrial
design and manufacturing.
Gelion is a public limited company, limited by shares,
incorporated and domiciled in England and Wales. The Company was
incorporated on 26 September 2015. The registered office of the
Company is at c/o Armstrong, Level 4 LDN:W, 3 Noble Street London
EC2V 7EE. The registered company number is 09796512.
Gelion Plc was incorporated as Gelion UK Ltd. On 12 November
2021, the Company was re-registered as a public limited company
under the Companies Act and its name was changed to Gelion plc.
The Board, Directors and management referred to in this document
refers to the Board, Directors and management of Gelion.
2. Accounting Policies
2.1 Basis of preparation
The principal accounting policies applied in the preparation of
the Group financial statements are set out below. These policies
have been consistently applied to the period presented, unless
otherwise stated.
These financial statements have been prepared in accordance with
UK-adopted International Accounting Standards and International
Accounting Standards as issued by the International Accounting
Standards Board (IASB) and Interpretations.
The preparation of financial statements in compliance with
UK-adopted International Accounting Standards requires the use of
certain critical accounting estimates. It also requires Group
management to exercise judgement in applying the Group's accounting
policies. The areas where significant judgements and estimates have
been made in preparing the financial statements and their effect
are disclosed in note 2.20.
These financial statements are presented in Great British Pounds
(GBP) unless otherwise stated, which is the Company's
presentational currency and the parent company's functional
currency. Amounts are rounded to the nearest thousand, unless
otherwise stated. The functional currency of the subsidiary is
Australian Dollars (AUD). Some numerical figures included in this
Annual Report have been subject to rounding adjustments. The
policies adopted for translation of the subsidiary's assets,
liabilities, income and expenses are set out in note 2.18 .
2.2 Basis of consolidation
The consolidated financial statements consolidate the financial
statements of Gelion Plc and of its subsidiary undertaking drawn up
to each reporting date.
Where the Company has control over an investee, it is classified
as a subsidiary. The Company controls an investee if all three of
the following elements are present: power over the investee,
exposure to variable returns from the investee, and the ability of
the investor to use its power to affect those variable returns.
Control is reassessed whenever facts and circumstances indicate
that there may be a change in any of the elements of control.
Profit or loss and each component of other comprehensive income
are attributed to the equity holders of the parent of the Group.
When necessary, adjustments are made to the financial statements of
subsidiaries to bring their accounting policies in line with the
Group's accounting policies. All intra-group assets and
liabilities, equity, income, expenses and cash flows relating to
transactions between members of the Group are eliminated in full on
consolidation.
The following was a subsidiary undertaking of the Group:
Name Registered Class of shares Holding
office
Gelion Technologies Pty
Limited Australia Ordinary A 100%
========================= ============ ================= ========
The shareholding is held directly.
The registered office of Gelion Technologies Pty Limited is
Level 16, 101 Miller Street, North Sydney, NSW 2060.
2.3 Restatement of comparatives
Where required by accounting standards, comparative figures have
been adjusted to conform to changes in presentation for the current
financial year. These restatements do not impact the net result of
the business reported in FY22.
Prior Period Restatements of Financial Statements
Management has made one restatement in the company's previously
issued consolidated financial statements for the year ended 30 June
2022. This was identified post the release of results and therefore
has been restated within the financial statements for the year
ended 30 June 2023.
This restatement is a reallocation and therefore does not impact
either the reported losses or cash position, and does not impact
the financial performance or financial position of the Company.
- Transaction costs on Share Issue - Restatement
Transaction costs related to the issue of shares in FY22 of
GBP805k have been restated from financing activities to operating
activities in the Cash Flow Statement given these were not directly
attributable to the initial capital raise in November 2021.
The net effect of this reclassification for the financial year
2022 is a decrease of GBP805k in cash flow from operating
activities and an increase in cash flow from financing activities
by the same amount. There is no impact on cash position at closing
of FY22 (30 June 2022).
2.4 Going concern
The financial statements have been prepared on a going concern
basis which assumes that the Group will have sufficient funds
available to enable it to continue to trade for the foreseeable
future. In making their assessment that this assumption is correct,
the Directors have undertaken an in-depth review of the business,
its current prospects, and cash resources as set out below.
The Directors have prepared a cash flow forecast for the period
ending 31 December 2024. The Group meets its normal working capital
requirements through existing cash resources (cash and cash
equivalents including term deposits) which, at 30 June 2023,
amounted to GBP7.3m (2022: GBP17.0m) with another GBP2.1m expected
to be received from the R&D tax incentives in or around
December 2023. The going concern period includes a receipt of
further R&D tax incentives and grants of GBP2.2m. In addition,
the Group recently completed a capital raise of GBP3.7m net of
transaction costs, of which c. 1.6m was utilised towards the
acquisition of OXLiD Ltd including associated transaction
costs.
After due consideration of these forecasts and current cash
resources, the Directors consider that the Group has adequate
financial resources to continue in operational existence for the
foreseeable future (being a period of at least twelve months from
the date of this report), and for this reason the financial
statements have been prepared on a going concern basis.
By the end of the period analysed, the Group will still hold a
reasonable proportion of the monies which should give the business
sufficient funds to operate in a similar way beyond the forecast
period.
The Directors have also considered reasonably plausible down
side scenarios, including a further 5% increase in salaries
(payment of which is within the Directors control) and a 5%
reduction in grant income. Under this scenario the business would
still have adequate financial resources to continue for at least 12
months from the date of approval of these financial statements. In
addition, if required to due to other unforeseen reasons, the
Directors could take further mitigating action to reduce cash
outflows by reducing uncommitted capital expenditure. The accounts
have therefore been prepared on a going concern basis.
The Directors have considered all of the above factors and
believe that as the potential opportunities are announced to the
market including the scale and prospects, the Group will be able to
raise any funds required to enable it to continue to trade and grow
towards self-sufficiency.
2.5 Revenue recognition
The Group recognises revenue as follows:
Revenue from Contracts with Customers (IFRS 15)
Revenue is recognised at an amount that reflects the
consideration to which the Group is expected to be entitled in
exchange for transferring goods or services to a customer. For each
contract with a customer, the Group: identifies the contract with a
customer; identifies the performance obligations in the contract;
determines the transaction price which takes into account estimates
of variable consideration and the time value of money; allocates
the transaction price to the separate performance obligations on
the basis of the relative stand-alone selling price of each
distinct good or service to be delivered; and recognises revenue
when or as each performance obligation is satisfied in a manner
that depicts the transfer to the customer of the goods or services
promised.
2.6 Other income
Grants and other benefits received from the government are
recognised in the Statement of Comprehensive Income at the fair
value of the cash received. Government grants are primarily
research and development incentives. This represents a refundable
tax offset that is available on eligible research and development
expenditure incurred by the Group.
Government grants are not recognised until there is reasonable
assurance that the Group will comply with the conditions attaching
to them and that the grants will be received. Government grants
that are receivable as compensation for expenses or losses already
incurred or for the purpose of giving immediate financial support
to the Group with no future related costs are recognised in profit
or loss in the period in which they become receivable.
2.7 Taxation
The income tax expense or benefit for the period is the tax
payable on the current periods taxable income based on the national
income tax rate for each jurisdiction, adjusted by changes in
deferred tax assets and liabilities attributable to temporary
differences, unused tax losses and adjustments recognised for prior
periods where applicable.
Deferred tax assets relating to temporary differences and unused
tax losses are recognised only to the extent that it is probable
that future taxable profit will be available against which the
benefits of the deferred tax asset can be utilised. Deferred tax
assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets and liabilities and
when the deferred tax balances relate to the same taxation
authority.
Current tax assets and tax liabilities are offset where the
entity has a legally enforceable right to offset and intends either
to settle on a net basis, or to realise the asset and settle the
liability simultaneously.
Current and deferred tax is recognised in profit or loss, except
to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax
is also recognised in other comprehensive income or directly in
equity, respectively.
2.8 Earnings per share
Basic earnings/loss per share
Basic earnings/loss per share is calculated by dividing:
-- the profit or loss attributable to owners of Gelion Plc,
excluding any costs of servicing equity other than Ordinary Shares;
by
-- the weighted average number of Ordinary Shares outstanding
during the financial year, adjusted for bonus elements in Ordinary
Shares issued during the financial year.
Diluted earnings/loss per share
Diluted earnings/loss per share adjusts the figures used in the
determination of basic earnings/loss per share to take into account
:
-- the after-income tax effect of interest and other financing
costs associated with dilutive potential Ordinary Shares; and
-- the weighted average number of shares assumed to have been
issued for no consideration in relation to dilutive potential
Ordinary Shares.
2.9 Cash and cash equivalents and short-term investments
Cash and cash equivalents
For the purpose of presentation in the Statement of Cash Flows,
cash and cash equivalents includes cash on hand, deposits held at
call with financial institutions, other short-term highly liquid
investments with original maturities of three months or less that
are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value, and bank
overdrafts. Term deposits that are held for a period of less than
three months form a part of cash and cash equivalents.
Short-term investments
Short-term investments in FY22 comprise of term deposits held by
UK licensed banks for a period greater than three months, over
which it can be converted to known amounts of cash with
insignificant risk of change in value. The amounts were measured at
amortised cost using the effective interest method in line with
IFRS 9.
2.10 Property, plant and equipment
Plant and equipment are stated at historical cost less
accumulated depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the
items.
Depreciation is calculated on a straight- line basis to write
off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Plant and equipment 3-7 years
Office furniture and equipment 3 years
Leasehold improvements are depreciated over the unexpired period
of the lease or the estimated useful life of the assets, whichever
is shorter.
The residual values, useful lives and depreciation methods are
reviewed, and adjusted if appropriate, at each reporting date.
An item of property, plant and equipment is derecognised upon
disposal or when there is no future economic benefit to the Group.
Gains and losses between the carrying amount and the disposal
proceeds are taken to profit or loss.
2.11 Right-of-use assets
A right-of-use asset is recognised at the commencement date of a
lease. The right-of-use asset is measured at cost, which comprises
the initial amount of the lease liability, adjusted for, as
applicable, any lease payments made at or before the commencement
date net of any lease incentives received, any initial direct costs
incurred, and, except where included in the cost of inventories, an
estimate of costs expected to be incurred for dismantling and
removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis
over the unexpired period of the lease or the estimated useful life
of the asset, whichever is the shorter. Where the Group expects to
obtain ownership of the leased asset at the end of the lease term,
the depreciation is calculated over its estimated useful life.
Right-of-use assets are subject to impairment or adjusted for any
remeasurement of lease liabilities.
The Group has elected not to recognise a right -of-use asset and
corresponding lease liability for short-term leases with terms of
12 months or less. Lease payments on these assets are expensed to
profit or loss as incurred.
2.12 Intangible assets
Research and development
Research and development expenditure is recognised as an expense
as incurred. No research and development costs have been
capitalised to date given the stage of the business.
Development expenditure is recognised as an expense except those
costs incurred on development projects can be capitalised as
intangible assets to the extent that such expenditure is expected
to generate future economic benefits.
Patents and trademarks
Separately acquired trademarks and patents are recognised at
historical cost. Patents have a finite life and are subsequently
carried at cost less accumulated amortisation. Separately acquired
trademarks are shown at historical cost. They are considered to
have infinite lives and are assessed for impairment at each year
end. The Group amortises intangible assets with a limited useful
life using the straight-line method over their expected useful
lives as follows:
Patents 15-20 years
Disposal of intangible assets
When an intangible asset, such as a patent, is disposed of or no
longer expected to generate future economic benefits, it is
derecognized from the financial statements. The profit or loss on
disposal is determined as the difference between the carrying
amount of the asset at the time of disposal and the proceeds from
its disposal.
The Group may dispose of intangible assets through various
methods, including but not limited to sale, abandonment, or
expiration of the asset's legal rights. The method of disposal is
chosen based on the circumstances at the time of disposal. Any gain
or loss on the disposal of an intangible asset is recognized in the
statement of profit or loss in the period in which the disposal
occurs.
2.13 Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised for the amount
by which the asset's carrying amount exceeds its recoverable
amount.
To date all impairments that have been recognised have been due
to patent costs capitalised in respect of patent applications that
have subsequently lapsed or been rejected. When this occurs, the
Group fully impairs the carrying amount of the patent at that
date.
2.14 Trade and other payables
These amounts represent liabilities for goods and services
provided to the Group prior to the end of the financial year and
which are unpaid. Due to their short-term nature, they are measured
at amortised cost and are not discounted. The amounts are unsecured
and are usually paid within 30 days of recognition.
2.15 Financial instruments
IFRS 9 requires an entity to address the classification,
measurement and recognition of financial assets and
liabilities.
a) Classification
The Group classifies its financial assets in the following
measurement categories:
-- those to be measured at amortised cost.
The classification depends on the Group's business model for
managing the financial assets and the contractual terms of the cash
flows.
The Group classifies financial assets as at amortised cost only
if both of the following criteria are met:
-- the asset is held within a business model whose objective is
to collect contractual cash flows; and
-- the contractual terms give rise to cash flows that are solely
payment of principal and interest.
b) Recognition
Purchases and sales of financial assets are recognised on trade
date (that is, the date on which the Group commits to purchase or
sell the asset). Financial assets are derecognised when the rights
to receive cash flows from the financial assets have expired or
have been transferred and the Group has transferred substantially
all the risks and rewards of ownership.
c) Measurement
At initial recognition , the Group measures a financial asset at
its fair value plus, in the case of a financial asset not at fair
value through profit or loss (FVPL), transaction costs that are
directly attributable to the acquisition of the financial
asset.
Transaction costs of financial assets carried at FVPL are
expensed in profit or loss.
d) Tax receivables
Management has assessed that tax receivables arising from a
refundable tax offset from Australian Taxation Office, for eligible
R&D expenditure, are recognised at its par value. These
receivables are expected to be collected in a short-term period and
the Directors have assessed there is no need for impairment of
these receivables. This is based on Australian government credit
rating (AAA) and successful historical collection of tax
receivables.
2.16 Share-based payments
The Group provides benefits to its employees in the form of
share-based payments, whereby employees render services in exchange
for shares or rights over shares (equity-settled transactions) in
the parent entity.
The cost of these equity-settled transactions with employees is
measured by reference to the fair value of the equity instruments
at the date at which they are granted. The fair value is determined
using a Black- Scholes model. This calculation is completed by the
parent entity.
The cost of these equity-settled transactions is recognised as
an expense, with a corresponding increase in equity, over the
period in which the service conditions are fulfilled (the vesting
period), ending on the date on which the relevant employees become
fully entitled to the award (the vesting date).
At each subsequent reporting date until vesting, the cumulative
charge to profit and loss is the product of:
-- the grant date fair value of the award;
-- the current best estimate of the number of awards that will vest;
-- the expired portion of the vesting period; and
-- the removal of any fair value attributable to share options
that have contractually lapsed or expired.
The charge to profit and loss for the period is the cumulative
amount as calculated above less the amounts already charged in
previous periods. There is a corresponding entry to the share-based
payment reserve in equity.
If a share-based payment arrangement is modified, the minimum
expense recognised over the vesting period is the original fair
value. If the modification increases fair value, the additional
fair value is recognised over the remaining vesting period.
2.17 Non-Recurring Items
The Group considers certain unusual or infrequent items that
either because of their size or their nature, or relevance to the
business as are non-recurring and disclose separately to report the
underlying performance of the business. For an item to be
considered as a separate item, it must initially meet at least one
of the following criteria:
-- It is a significant item, which may cross more than one accounting period.
-- It has been directly incurred as a result of either an
acquisition / divestment or funding related or arises from a major
business change.
-- It is unusual in nature, e.g. outside the normal course of business.
If an item meets at least one of the criteria, the Board,
through the Audit and Risk Committee, then exercises judgement as
to whether the item should be classified as an allowable adjustment
to IFRS performance measures and disclosed separately.
2.18 Foreign currency translation
The functional currency of each company in the Group is that of
the primary economic environment in which the entity operates.
Monetary assets and liabilities denominated in foreign currencies
are translated into GBP at the rates of exchange ruling at the
period end. Transactions in foreign currencies are recorded at the
rate ruling at the date of the transaction.
All differences are taken to the Statement of Comprehensive
Income. On consolidation, the assets and liabilities of the Group
entities that have a functional currency different to the
presentational currency are translated into GBP at the closing rate
at the date of the Statement of Financial Position. Income and
expenses for each statement of profit or loss are translated at
average exchange rates for the period. Exchange differences are
recognised in other comprehensive income and accumulated in a
foreign exchange translation reserve.
2.19 Contributed equity
Ordinary Shares are classified as equity. Incremental costs
directly attributable to the issue of new shares are deducted from
the share premium account.
When the Group issues a hybrid instrument consisting of a debt
host liability and a non-closely related embedded derivative (the
conversion feature) and the Group accounts for the debt host at
amortised cost and the embedded derivative at FVTPL, when
conversion takes place, no gain or loss on conversion is
recognised. The equity issued is measured by reference to the sum
of the carrying amount of the host debt liability plus the carrying
amount of the embedded derivative at the date of conversion, rather
than the fair value of the shares issued. This approach is in line
with the policy followed for conversion of compound
instruments.
Retained losses includes all current and prior period
results.
2.20 Input taxes
Revenues, expenses and assets are recognised net of the amount
of associated goods and services tax (GST) in Australia or value
added tax (VAT) in the UK, unless the sales tax incurred is not
recoverable from the taxation authority. In this case it is
recognised as part of the cost of acquisition of the asset or as
part of the expense.
Receivables and payables are stated inclusive of the amount of
sales tax receivable or payable. The net amount of sales tax
recoverable from, or payable to, the taxation authority is included
with other receivables or payables in the balance sheet.
Cash flows are presented on a net basis. The sales tax
components of cash flows arising from investing or financing
activities which are recoverable from, or payable to the taxation
authority, are presented as operating cash flows.
2.21 Critical accounting judgements and key sources of estimation uncertainty
The preparation of the financial information requires the use of
accounting estimates which, by definition, will seldom equal the
actual results. Management also needs to exercise judgement in the
process of applying the Group's accounting policies. The areas
involving a high degree of judgement or complexity, or areas of
assumptions and estimates are:
Critical accounting judgements
- R&D tax incentives
From 1 July 2011, the Australian Taxation Office has provided a
tax incentive, in the form of a refundable tax offset of 43.5%, for
eligible research and development expenditure. Management has
assessed its research and development activities and expenditure
and applied judgement in determining which expenses are likely to
be eligible under the scheme. For the period ended 30 June 2023 the
Group has recorded other income of GBP2,049,000 (2022:
GBP1,719,000) based on expected tax refunds to be received from the
government (recognised under Other receivables at 30 June
2023).
- Recognition of a deferred tax asset
The Group has incurred tax losses in both Australia and the UK
in each of the periods reported in these financial statements. No
deferred tax asset has been recognised in respect of these losses,
as the Directors believe that there is not sufficient certainty
over future profits that would utilise them.
Key sources of estimation uncertainty
- Estimation of useful lives of property, plant and equipment and intangible assets
The Group determines the estimated useful lives and related
depreciation and amortisation charges for its property , plant and
equipment and finite life of intangible assets. The useful lives
could change significantly as a result of technical innovations or
some other event. The depreciation and amortisation charge will
increase where the useful lives are less than previously estimated
lives, or technically obsolete or non-strategic assets that have
been abandoned or sold will be written off or written down.
Patents are recognised at cost. Management believes this is the
best estimate at the current time, during the research and
development phase. The key assumption for amortisation is the
useful life which is determined by the life of the patent (grant to
expiration date - usually 15-20 years). The Directors do not
believe that a future change in the useful life of patents is
probable in the foreseeable future.
Trademarks are recognised at cost. Management believes this is
the best estimate at the current time. The key assumption for
trademarks is they have an infinite life as they do not have an
expiration date.
- Impairment of patents and trademarks
The Group assesses impairment of patents and trademarks at each
reporting date by evaluating conditions specific to the Group and
to the particular asset that may lead to impairment. If an
impairment trigger exists , the recoverable amount of the asset is
determined. To date the only impairments recognised have been due
to patent costs capitalised in respect of patent applications that
have subsequently lapsed or been rejected. In these instances, the
Group fully impairs the carrying amount of patent at that date.
- Derecognition of intangible assets (patents and trademarks)
An intangible asset is derecognised on disposal, or when no
future economic benefits are expected from use or disposal. Gains
or losses arising from derecognition of an intangible asset,
measured as the difference between the net disposal proceeds and
the carrying amount of the asset, are recognised in profit or loss
when the asset is derecognised.
- Recognition of equity-settled share-based payments
The cost of equity-settled share -based payment transactions
with employees is measured by reference to the fair value of the
equity instruments at the date at which they are granted. The fair
value is determined using a Black-Scholes model. The Group applies
a straight-line vesting approach, whereby the instruments are split
into tranches according to the vesting conditions applied. Please
refer to note 19 for the key assumptions and inputs used in the
model to determine the fair values at each measurement date.
2.22 Standards, amendments and interpretations to existing
standards that are effective for the first time in the financial
year
During the year ended 30 June 2023, Gelion has adopted the
following new IFRSs (including amendments thereto) and IFRIC
interpretations that became effective for the first time.
Standard Effective date, annual
period beginning on
or after
Amendments to IAS 1, IAS 8, IAS 12 and 1 January 2023
IFRS Practice Statement 2
======================================= =======================
IFRS 17 Insurance Contracts 1 January 2023
======================================= =======================
Their adoption has not had any material impact on the
disclosures or amounts reported in the financial information.
Standards issued but not yet effective:
There are a number of standards, amendments to standards, and
interpretations which have been issued by the IASB that are
effective in future accounting periods that the Group has decided
not to adopt early.
Standard Effective date, annual
period beginning on
or after
Lease Liability in a Sale and Leaseback (Amendment 1 January 2024
to IFRS 16)
=================================================== =======================
IAS 1 Presentation of Financial Statements 1 January 2024
(Amendment - Classification of Liabilities
as Current or Non-Current)
=================================================== =======================
IAS 1 Presentation of Financial Statements 1 January 2024
(Amendment - Non-current Liabilities with
Covenants)
=================================================== =======================
IAS 7 Statement of Cash Flows and IFRS 7 Financial 1 January 2024
Instruments: Disclosures (Amendment - Supplier
Finance Arrangements)
=================================================== =======================
All of the above standards issued but not yet effective have
been endorsed by the UK Endorsement Board.
The Directors are evaluating the impact that these standards
will have on the financial information of Gelion.
3. Segment Reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating
decision-maker.
The chief operating decision- maker , who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Board as a whole.
In the opinion of the Directors, during each of the two-years
ended 30 June, Gelion operated in the single business segment of
battery production and development.
UK Australia As at 30 UK Australia As at 30
June 2023 June 2022
GBP ' 000 GBP ' 000
Non-current assets
Intangible assets - 3,349 3,349 - 362 362
Property, plant
and equipment - 957 957 - 1,050 1,050
-------------------- ------ ---------- ----------- ------ ---------- -----------
Total income
Other income 5 2,049 2,054 26 1,719 1,745
==================== ====== ========== =========== ====== ========== ===========
Depreciation and
amortisation - (463) (463) - (308) (308)
==================== ====== ========== =========== ====== ========== ===========
Finance income
(interest) 98 55 153 - 2 2
==================== ====== ========== =========== ====== ========== ===========
Operating loss
Operating loss (966) (6,591) (7,557) (574) (8,513) (9,087)
==================== ====== ========== =========== ====== ========== ===========
4. Other Income
Year ended 30 June
2023 2022
GBP'000 GBP'000
R&D tax concessions 2,049 1,719
Recovery of VAT 5 26
2,054 1,745
========== =========
The subsidiary incurs R&D expenditure which qualifies for
relief under a tax incentive scheme provided by the Australian
Taxation Office. Management estimates the expenditure each year
relevant to approved R&D activities in respect of which a claim
can be made at each reporting date. The accounting policy in
respect of recognition of this income is detailed in note 2.6 and
the key accounting judgements applied are detailed in note 2.21
.
5. Non-Recurring Items
Year ended 30 June
2023 2022
GBP'000 GBP'000
Listing costs - 411
Share-based payments accelerated due to listing - 3,853
Key management bonus contingent on listing - 394
Net loss on sales of fixed assets 186 -
Transaction costs incurred for IP acquisition 80 -
and divestment
Total non-recurring items 266 4,658
========== =========
Certain costs were incurred in FY22 relating to the Company
converting from a private to public limited company, its subsequent
admission to AIM, issuance and sale of shares and associated
professional costs. For more details on these expenses please refer
to FY22 Annual Report on our website:
https://gelion.com/wp-content/uploads/2022/11/Gelion-Annual-Report-and-Financial-Gelion-Statements-for-the-year-ended-30-June-2022.pdf#page=71
Non-recurring costs in FY23 include one-off loss on sales of
fixed assets and advisory costs incurred in relation to the
purchase and sale of the IP portfolio that were non-recurring in
nature. These have been separately disclosed to assist the user of
the financial information to understand and compare the underlying
results of the Company .
6. Operating Loss Before Listing and Other Non-Recurring Items
Operating loss is stated after the following specific income and
expenses:
Year ended 30 June
Note 2023 2022
GBP'000 GBP'000
R&D tax concessions 4 2,049 1,719
Depreciation and amortisation 12, 13 (463) (308)
Employee benefits 10 (5,223) (3,212)
R&D expenses (1,553) (1,391)
Out of which:
External R&D services (925) (669)
R&D materials, consumables & other (628) (722)
Administration and other expenses (1,212) (1,214)
Share-based payments (recurring) (894) (49)
7. Auditors' Remuneration
Year ended 30 June
2023 2022
GBP'000 GBP'000
Fees payable to the Company's auditors for
the statutory audit of the Company's annual
financial statements 70 52
Fees payable to the Company's auditors and
its associates for the audits of the Company's
subsidiaries 33 24
Non-audit services
Reporting accountant services - 278
Taxation and other services 9 31
Total auditors' remuneration 112 385
========== =========
8. Taxation
Year ended 30 June
2023 2022
GBP'000 GBP'000
The charge/credit for the year is made up as
follows:
Corporation taxation on the results for the - -
year
Taxation (charge)/credit for the year - -
========== =========
Numerical reconciliation of income tax expense
to accounting loss:
Profit/(loss) for the year before income tax (7,407) (9,157)
========== =========
Prima facie tax benefit on loss from ordinary
activities before income tax at 25% (2022:
25%) (1,852) (2,290)
Add/(less) tax effect of:
Non-deductible expenditure 1,435 2,200
Non-assessable income - -
R&D tax offsets (512) (430)
Tax losses incurred but not recognised 878 506
Difference in tax rates applied 51 14
========== =========
Total income tax expense - -
========== =========
Non-deductible expenses include share-based payments and
expenditure subject to R&D tax incentive.
Estimated tax losses of GBP7,452,000 (2022: GBP4,138,000) are
available for relief against future profits. No deferred tax asset
has been provided for in the accounts based on the estimated tax
losses. The estimated tax losses per jurisdiction is as follows and
don't have an expiry date in each of these jurisdictions:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Estimated tax losses arising in the UK 1,664 793
Estimated tax losses arising in Australia 5,788 3,345
Total tax losses available to carry forward 7,452 4,138
========== =========
The standard rate of corporation tax in Australia, where the
subsidiary is based, is 25% (2022: 25%).
As per note 2.7, deferred tax assets have not been recognised on
the basis the Company is not forecasted to make a profit for the
foreseeable future.
9. Exchange Gains and Losses Arising on Translation of Foreign Operations
Gelion Technologies Pty Limited, a battery manufacturing
business incorporated in Australia, was merged into Gelion UK
Limited in 2016 so as to maximise operational synergies and
generate further cost savings.
A gain or loss through other comprehensive income arises on
translation of the subsidiary's assets and liabilities from
Australian Dollars to Great British Pounds at each year end.
10. Employee Benefit Expenses and Numbers
Employee benefit expenses (including Directors) comprise:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Recurring costs:
Salaries and wages including taxes 4,005 2,957
Defined contribution pension cost 324 206
Share-based payment expense - recurring 894 49
========== =========
Total employee benefits expense (note 6) -
recurring 5,223 3,212
========== =========
Non-recurring costs:
Salaries and wages including taxes - 394
Defined contribution pension cost - -
Share-based payment expense - 3,853
Total employee benefits expense (note 7) -
non-recurring - 4,247
========== =========
Refer to note 20 for details of classification of share-based
payments expense between recurring and non-recurring costs.
Average Employee Numbers
2023 2022
(#) (#)
R&D 36 26
=================================== ====== ======
Administration 17 11
=================================== ====== ======
Average number of employees 53 37
=================================== ====== ======
Employee headcount at period end 47 51
=================================== ====== ======
Increase in the average number of employees from FY22 to FY23 is
primarily impacted by:
-- the full year impact of new hires who commenced in late FY22; and
-- the inclusion of temporary staff who assisted in the pilot manufacturing plant during FY23.
The actual closing headcount decreased to 47 at 30 June 2023 (51
at 30 June 2022) due to cost saving measures implemented by
management where only selected roles were replaced, rather than
filling all vacant positions.
Key management personnel
Directors and key management personnel compensation
The total remuneration paid (including bonus accruals) to the
Directors and key management personnel of the Group during the year
are as follows:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Recurring costs:
Salaries and wages including taxes 873 1,059
Defined contribution pension cost 44 48
Share-based payment expense 691 10
========== =========
Total key management personnel costs - recurring 1,608 1,117
========== =========
Non-recurring costs:
Salaries and wages including taxes - 394
Defined contribution pension cost - -
Share-based payment expense - 3,378
========== =========
Total key management personnel costs - non-recurring - 3,772
========== =========
Total key management personnel costs 1,608 4,889
========== =========
The Directors and senior management represent key management
personnel. Further details of Directors' remunerations are given in
the Directors' Remuneration Report. The highest paid Director
during the year received total remuneration (recurring and
non-recurring) of GBP189,014 (2022: GBP584,900). No share options
were exercised by Directors during the financial year ended 30 June
2023 or 30 June 2022.
Refer to note 19 for details of classification of share-based
payments expense between recurring and non- recurring costs.
11. Loss Per Share
Year ended 30 June
2023 2022
Loss after tax GBP7,407,000 GBP9,157,000
Weighted average number of shares (number) 107,944,951 99,888,579
Loss per share (pence) 6.9p 9.2p
============================================ ============= =============
The calculation of the loss per share is based on the loss for
the financial period after taxation of GBP7,407,000 (2022:
GBP9,157,000) and on the weighted average of 107,944,951 (2022:
99,888,579) Ordinary Shares in issue during the period.
In FY23, the parent company issued:
-- 1,101,516 shares, majority of which relates to a share issue
to ex-CEO Andrew Grimes (1,026,516) in lieu of cancelled
options;
-- 171,396 ordinary shares to the University of Sydney in
exchange for acquisition of Lithium Sulfur IP ($130,000).
This increase in the number of Ordinary Shares has resulted in
the weighted average number of shares in the year to June 2023 to
increase to 107,944,951 (2022: 99,888,579).
There were 8,478,535 share options outstanding at 30 June 2023
(2022: 7,554,360). The impact of these options would be to reduce
the diluted loss per share and therefore they are antidilutive.
Hence, the diluted loss per share reported for the periods under
review is the same as the earnings per share.
12. Intangible Assets
Patents Trademarks Total
GBP'000 GBP'000 GBP'000
At 30 June 2021 334 19 353
Cost
Additions 39 9 48
Disposals - - -
Difference on foreign exchange 14 1 15
========= =========== =========
At 30 June 2022 387 29 416
Additions 4,298 4 4,302
Disposals (1,189) - (1,189)
Impairment (37) (11) (48)
Difference on foreign exchange (29) (2) (31)
At 30 June 2023 3,430 20 3,450
========= =========== =========
Amortisation
At 30 June 2021 40 - 40
Amortisation 12 - 12
Difference on foreign exchange 2 - 2
========= =========== =========
At 30 June 2022 54 - 54
Amortisation 54 - 54
Difference on foreign exchange (7) - (7)
========= =========== =========
At 30 June 2023 101 - 101
========= =========== =========
Carrying amount
========= =========== =========
At 30 June 2022 333 29 362
========= =========== =========
At 30 June 2023 3,329 20 3,349
========= =========== =========
On 9 March 2023, Gelion acquired an IP portfolio in a range of
next generation battery material technologies from Johnson Matthey,
a British multinational chemicals and sustainable technologies
company. The Company acquired the LiSiS patent portfolio for GBP4.3
million and has immediately sold part of portfolio to a third party
for a cash consideration of GBP1.2 million.
On 13 March 2023, Gelion acquired the University of Sydney's
Lithium Sulfur IP for a total consideration of AUD$130,000, which
was satisfied by the issue of 171,396 ordinary shares.
13. Property, Plant and Equipment
Office furniture Plant and Right-of-use Leasehold
and equipment equipment assets improvements Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 30 June 2021 38 517 341 50 946
Additions 34 649 54 50 787
Disposals - (11) - - (11)
Difference on foreign
exchange 3 22 15 2 42
================= =========== ============= ============== ========
At 30 June 2022 75 1,177 410 102 1,764
Additions 12 416 47 28 503
Disposals 0 (160) 0 0 (160)
Difference on foreign
exchange (6) (87) (30) (8) (131)
================= =========== ============= ============== ========
At 30 June 2023 81 1,346 427 122 1,976
================= =========== ============= ============== ========
Depreciation
At 30 June 2021 28 123 217 25 393
Charge for the year 11 131 124 30 296
Accumulated depreciation
on disposal - (3) - - (3)
Difference on foreign
exchange 1 10 15 2 28
================= =========== ============= ============== ========
At 30 June 2022 40 261 356 57 714
Charge for the year 18 310 49 32 409
Accumulated depreciation
on disposal (29) (29)
Difference on foreign
exchange (3) (36) (29) (7) (75)
At 30 June 2023 55 506 376 82 1,019
================= =========== ============= ============== ========
Carrying amount
================= =========== ============= ============== ========
At 30 June 2022 35 916 54 45 1,050
================= =========== ============= ============== ========
At 30 June 2023 26 840 51 40 957
================= =========== ============= ============== ========
14. Leases
The Group has lease contracts in respect of leasehold property
used in its operations. These leases have lease terms of between
two and three years.
There is no leasehold property recognised by the Group in the
two years ended 30 June presented in these financial statements
other than those recognised as right-of-use assets. Therefore, for
the carrying amount of right-of-use assets at each reporting date
and movements in each year ended refer to note 13 .
Set out below are the carrying amounts of lease liabilities
(included under trade and other payables) and the movements during
each year ended 30 June:
2023 2022
GBP'000 GBP'000
Balance as at 1 July 56 122
Additions 47 54
Interest 3 4
Payments (46) (130)
Difference on foreign exchange (4) 6
========= =========
Balance as at 30 June 56 56
========= =========
The maturity analysis of lease liabilities is disclosed in note
20 .
The following are the amounts recognised in profit or loss:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Depreciation expense of right-of-use assets 46 124
Interest expense on lease liabilities 3 4
========== =========
Total amount recognised in profit or loss 49 128
========== =========
15. Cash and Cash Equivalents
As at 30 June
2023 2022
GBP'000 GBP'000
Cash at bank 7,268 16,024
========= =========
7,268 16,024
========= =========
Cash at bank comprises balances held by Gelion Plc and Gelion
Technologies Pty Limited current bank accounts. Cash deposits
greater than three months are recorded within short-term
investments as per note 16 . See note 20 for further discussion of
these balances.
16. Short-term Investments and Other Receivables
As at 30 June
2023 2022
GBP'000 GBP'000
Short-term investments:
Term deposits - 1,017
========= =========
Total short-term investments - 1,017
========= =========
Other receivables:
R&D tax incentive 1,934 1,784
Prepayments 172 187
Other debtors 8 182
Total other receivables 2,114 2,153
========= =========
Term deposits in FY22 comprised cash deposits held by UK
licensed banks for a period of greater than three months, over
which there is no recall during the term of the deposit. The
amounts are measured at amortised cost using the effective interest
method in line with IFRS 9. There were no term deposits for a
period greater than three months as of June 2023.
R&D tax incentives are granted by the Australian Taxation
Office in the form of tax offsets. The key judgements applied in
the recognition of this receivable are detailed in note 2.21 .
The Directors consider that the carrying value of short-term
investments and other receivables approximates to their fair
value.
17. Trade and Other Payables
Due within one year
As at 30 June
2023 2022
GBP'000 GBP'000
Trade payables 228 312
Accruals 584 360
Employee liabilities including employment taxes 171 157
Lease liabilities 26 25
Other payables (GST / VAT) 48 -
========= =========
1,057 854
========= =========
Due in more than one year
As at 30 June
2023 2022
GBP'000 GBP'000
Lease liabilities 27 31
========= =========
27 31
========= =========
Trade payables and accruals principally comprise amounts
outstanding for trade purchases and continuing costs. Out of total
GBP584k accruals as of June 2023, GBP250k relates to a deferred
consideration as per contract with Johnson Matthey, for recent
Lithium IP acquisition. The Directors consider that the carrying
value amount of trade and other payables approximates to their fair
value . Please refer to note 20 for further details.
18. Issued Capital and Reserves
Share capital and premium
Number of shares Share Share
Ref. on issue capital premium
GBP'000 GBP'000
Balance as at 1 July 2021 a 4,494,196 33 11,251
Bonus issues and reorganisation b 85,389,724 57 (57)
Capital reduction c - - (11,195)
Shares issued during the
period d 11,063,679 11 16,032
Loan notes converted to equity e 5,516,240 6 5,993
Cost of shares issued f - - (1,541)
Exercise of share options 671,000 - 178
================= ========= ==========
Balance as at 30 June 2022 107,134,839 107 20,662
Bonus issues and reorganisation - - -
Capital reduction - - -
Shares issued during the
period g/h 1,197,911 1 74
Loan notes converted to equity - - -
Cost of shares issued - - -
Exercise of share options 75,000 - 16
================= ========= ==========
Balance as at 30 June 2023 108,407,750 108.00 20,752
================= ========= ==========
a) Gelion had two classes of share at 1 July 2021 - A Ordinary
and B Ordinary which ranked pari passu.
At 30 June 2021 there were 3,335,196 A Ordinary Shares of
GBP0.01 each.
At 30 June 2021 there were 1,159,000 B Ordinary Shares of
GBP0.0000086 each.
b) On 2 September 2021, the Company consolidated the 1,159,000 B
Ordinary Shares of GBP0.0000086 each into 1,000 B Ordinary Shares
of GBP0.01 each, on the basis of one B Ordinary Share of GBP0.01
for every 1,159 B Ordinary Shares of GBP0.0000086 held on the
record date (the 'B Share Consolidation').
On 2 September 2021, following the B Share Consolidation, the
Company issued 1,158,000 new B Ordinary Shares of GBP0.01 each by
way of a bonus issue to the holders of such shares on the basis of
1,158 B Ordinary Shares for each one B Ordinary Share held on the
record date (the 'First Bonus Issue').
On 3 September 2021, following completion of the First Bonus
Issue, the Company issued 3,335,196 A Ordinary Shares of GBP0.01
each and 1,159,000 B Ordinary Shares of GBP0.01 each pursuant to a
bonus issue of such shareholders on the basis of one A Ordinary
Share for each A Ordinary Share held and one B Ordinary Share for
each B Ordinary Share held, in each case on the record date (the
'Second Bonus Issue').
c) Immediately following the Second Bonus Issue, a capital
reduction was undertaken and the balance standing to the credit of
the share premium account was cancelled and the amount so cancelled
was credited to a distributable reserve.
On 12 November 2021, the A Ordinary Shares of GBP0.01 each in
the capital of the Company and the B Ordinary Shares of GBP0.01
each in the capital of the Company then in issue were redesignated
as Ordinary Shares of GBP0.01 each in the capital of the Company
carrying the rights and subject to the restrictions attaching to
the Ordinary Shares of the Company as set out in the Articles (the
'Re-designation')
On 13 November 2021, the Company sub-divided each Ordinary Share
of GBP0.01 each arising from the Re-designation into ten new
Ordinary Shares of GBP0.001 each.
d) Immediately prior to admission to AIM the Company had
89,883,920 shares in issue. 11,063,679 new Ordinary Shares of
GBP0.001 each were issued in the fundraising following admission to
AIM.
e) On 30 November 2021, a convertible debt instrument was fully
converted into 5,516,240 Ordinary Shares of GBP0.001 each.
f) Transaction costs incurred in the issuing of shares in the
period ended 30 June 2022 of GBP2,346,000 of which GBP1,541, 000
have been offset against share premium and GBP805,000 have been
expensed.
g) On 19 October 2022, 1,026,515 Ordinary Shares of GBP0.001
each were issued to ex-CEO Andrew Grimes (related party
transaction) in exchange for relinquishing 1,830,000 options that
had vested.
h) On 13 March 2023, Gelion acquired the University of Sydney's
Lithium Sulfur IP for a total consideration of AUD$130,000, which
was satisfied by the issue of 171,396 Ordinary Shares.
Nature and purpose of other reserves
Other reserves
- Share-based payments reserve
The share-based payments reserve is used to recognise the value
of equity-settled share-based payments provided to employees ,
including key management personnel, as part of their remuneration.
Refer to note 19 for further details of these plans.
- Foreign currency translation reserve
The subsidiary's functional currency is AUD and therefore on
consolidation a foreign exchange gain or loss on translation of net
assets is recognised through other comprehensive income at each
reporting date. These gains or losses are accumulated in a foreign
currency translation reserve.
- Capital reduction reserve
Immediately following the Second Bonus Issue in FY22, the
balance standing to the credit of the share premium account was
cancelled and the amount so cancelled was credited to a
distributable reserve called the 'capital reduction reserve'.
Other non-distributable reserves:
Foreign currency Total
Share-based translation other
payment reserve reserve reserves
GBP'000 GBP'000 GBP'000
Balance at 1 July 2021 892 (201) 691
Foreign currency translation reserve
movement - 713 713
Share-based payment charge 3,902 - 3,902
Exercise of options (158) - (158)
Balance at 30 June 2022 4,636 512 5,148
================= ================= ==========
Balance at 1 July 2022 4,636 512 5,148
Foreign currency translation reserve
movement - (695) (695)
Share-based payment charge 894 - 894
Forfeited / cancelled options (19) - (19)
Exercise of options - - -
Balance at 30 June 2023 5,511 (183) 5,328
================= ================= ==========
19. Share-Based Payments
The Directors recognise the role of the Group's staff in
contributing to its overall success and the importance of the
Group's ability to incentivise and motivate its employees.
Therefore, the Directors believe that certain employees should be
given the opportunity to participate and take a financial interest
in the success of the Company.
In prior years, the Group operated a Share Option Plan whereby
employees and key service providers were granted options over
shares in Gelion UK Limited. Due to the Company's admission to
trading on AIM which took place on 30 November 2021 all unvested
options were vested triggering an accelerated share-based payment
expense.
In addition to the Original Share Option Plan, the Group agreed
to grant options over Ordinary Shares pursuant to obligations under
the service agreements with the relevant individuals. These service
agreement obligations were triggered by admission to trading on
AIM. The service condition is to be employed with a company in the
Group at vesting. Both the acceleration of option vesting and
additional options granted pursuant to service agreement
obligations are triggered by the Company's admission to AIM and
therefore can be considered as part of the same non-recurring
event.
In July 2022, the Board introduced a new Share Option Plan. The
plan is designed to motivate and incentivise key talent to assist
the Group in achieving its strategic aims whilst remaining
consistent with its tolerance for risk, all set within delegated
limits set out during the recent IPO.
These options are structured as nominal cost options. The
options will normally vest in three equal tranches over three
years, subject to continued employment.
On 21 November 2022, 255,951 options were granted that will vest
in three equal tranches, the first anniversary is 31 August 2023,
followed by annual vesting on 31 August 2024 and 31 August 2025.
The options were granted with the exercise price of 0.1 pence and
will be exercisable up to the tenth anniversary of the grant.
On 8 December 2022, 2,704,000 options granted to Mr John Wood
and these will vest in three tranches as follows: 12 months from
grant date 1,622,400, 24 months from grant date 540,800 and 36
months from grant date 540,800. The options were granted with the
exercise price of 0.1 pence and are exercisable up to the fifth
anniversary of the grant.
Year ended 30 June
2023 2022
GBP'000 GBP'000
Recurring share-based payment expense recognised 894 49
Non-recurring share-based payment expense recognised - 3,853
========== =========
Total share-based payment expense 894 3,902
========== =========
Summary of movements in awards:
2021 and
New Share prior Original
Option Share Option
Plan Plan Weighted average
Number Number exercise price
'000s '000s GBP
Outstanding at 1 July 2021 - 5,100 0.26
Granted - 3,600 0.39
Forfeited - (466) 0.33
Exercised - (671) 0.25
Expired - - -
========== ================ =================
Outstanding at 30 June 2022 - 7,563 0.32
========== ================ =================
Exercisable at 30 June 2022 - 7,402 0.34
========== ================ =================
Granted 2,960 - 0.00
Forfeited / Cancelled (64) (1,905) 0.32
Exercised - (75) 0.22
Expired - - -
========== ================ =================
Outstanding at 30 June 2023 2,896 5,583 0.21
========== ================ =================
Exercisable at 30 June 2023 - 5,583 0.32
========== ================ =================
The range of exercise prices for options outstanding at the end
of the year was GBP0.001 to GBP1.45 (2022: GBP0.22 to GBP1.45).
The weighted average remaining contractual life for the share
options outstanding as at 30 June 2023 was 7.02 years (2022: 7.85
years).
Of the total number of options outstanding at 30 June 2023,
5,582,795 (2022: 7,402,000) had vested and were exercisable.
The weighted average fair value of the options granted in the
year was GBP0.52 (2022: GBP1.23).
The Black-Scholes option pricing model was used to value the
share-based payment awards granted in the year as it was considered
that this approach would result in materially accurate estimate of
the fair value of options granted. The following table lists the
inputs to the models used for share option plans:
2023 2022
Weighted average fair values at the measurement GBP0.52 GBP1.23
date
Weighted average exercise price GBP0.001 GBP1.45
Dividend yield (%) - -
Expected volatility (%) n/a 62.8
Risk-free interest rate (%) n/a 1.3
Expected life of share options (years) 10 10
================================================= ========= ========
*2023 Options that were granted represent nominal cost options
with an exercise price of GBP0.001. Nominal cost options fair
value, under the Black-Scholes option pricing model, equals the
share price at grant date, therefore expected volatility and
risk-free interest rate have no impact on the valuation. In the
year ended 30 June 2023 2,959,951 options (2022: 3,600,000) were
granted at an exercise price of GBP0.001 (2021: GBP0.39). The total
share-based payment expense for the year was GBP894,000 (2022:
GBP3,902,000).
20. Financial Instruments and Risk Management
Capital risk management
The Group manages its capital to ensure it will be able to
continue as a going concern while maximising the return to
stakeholders. The overall strategy of the Group is to minimise
costs and liquidity risk.
The capital structure of the Group consists of equity
attributable to equity holders of the Group, comprising issued
share capital, and retained earnings as disclosed in the
Consolidated Statement of Changes of Equity.
The Group is exposed to a number of risks through its normal
operations, the most significant of which are credit, currency and
liquidity risks. The management of these risks is vested to the
Board of Directors.
Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations and arises principally from the Group's
receivables from customers. Indicators that there is no reasonable
expectation of recovery include, amongst others, failure to make
contractual payments for a period of greater than 120 days past
due. There were no receivables from customers as at end of June
2023.
The carrying amount of financial assets represents the maximum
credit exposure.
The principal financial assets of the Group are bank balances
including short-term deposits. The Group deposits surplus liquid
funds with counterparty banks that have high credit ratings, and
the Directors consider the credit risk to be minimal. The Group's
maximum exposure to credit by class of individual financial
instrument is shown in the table below:
As at 30 June
2023 2023 2022 2022
Carrying Maximum Carrying Maximum
value exposure value exposure
GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash equivalents 7,268 7,268 16,024 16,024
Short-term deposits - term deposits - - 1,017 1,017
========== ========== ========== ==========
7,268 7,268 17,041 17,041
========== ========== ========== ==========
As at 30 June
2023 2023 2022 2022
2023 Cash Short-term 2022 Cash at Short-term
Rating at bank deposits Rating bank deposits
GBP'000 GBP'000 GBP'000 GBP'000
Royal Bank of
Scotland A+ 4,237 - A+ 6,899 1,017
Commonwealth
Bank of Australia A+ 3,031 - A+ 9,125 -
========= ========= ============ ======== ========= ============
7,268 - 16,024 1,017
============================== ========= ============ ======== ========= ============
The Group monitors the credit ratings of counterparties
regularly and at the reporting date does not expect any losses from
non-performance by the counterparties. For all financial assets to
which the impairment requirements have not been applied, the
carrying amount represents the maximum exposure to credit loss.
Currency risk
The Group operates in a global market with income and costs
possibly arising in a number of currencies (AUD, USD, EUR) and is
exposed to foreign currency risk arising from commercial
transactions, acquiring fixed assets and raw materials, as well as
translation of net investment in foreign subsidiaries. Exposure to
commercial transactions arise from sales or purchases by operating
companies in currencies other than the companies' functional
currency. Currency exposures are reviewed regularly. The Group has
signed an agreement with financial institution post end of FY22, to
set forward exchange rate contracts to provide certainty in terms
of cash flow forecasts.
The Group has a limited level of exposure to foreign exchange
risk through their foreign currency denominated cash balances and a
portion of the Group's costs being incurred in Australian Dollar.
Accordingly, movements in the Great British Pounds exchange rate
against these currencies could have a detrimental effect on the
Group's results primarily for reporting purposes.
Currency risk is managed by maintaining some cash deposits in
currencies other than Great British Pounds, particularly those
currencies where future expenditure is forecasted. The table below
shows the currency profiles of cash and cash equivalents:
As at 30 June
2023 2022
GBP'000 GBP'000
Cash, cash equivalents and term deposits
US Dollars 317 -
Great British Pounds 1,593 2,471
Australian Dollars 5,358 14,570
========= =========
7,268 17,041
========= =========
Liquidity risk
Liquidity risk is the risk that the Group will encounter
difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another
financial asset. The Group's approach to managing liquidity is to
ensure, as far as possible, that it will have sufficient liquidity
to meet its liabilities when they are due, under both normal and
stressed conditions, without incurring unacceptable losses or
risking damage to the Group's reputation.
The Group seeks to manage liquidity risk by regularly reviewing
cash flow budgets and forecasts to ensure that sufficient liquidity
is available to meet foreseeable needs and to invest cash assets
safely and profitably. The Group deems there is sufficient
liquidity for the foreseeable future.
The Group had cash and cash equivalents at period end as
below:
As at 30 June
2023 2022
GBP'000 GBP'000
Cash and cash equivalents 7,268 16,024
========= =========
7,268 16,024
========= =========
The table below sets out the maturity profile of the Group's
financial liabilities at each year end:
Year ended 30 June 2023
Due between Due between
Due in Due between three months one year
less than one and and one and five
one month three months year years Total
GBP'000 GBP'000 GBP ' 000 GBP'000 GBP ' 000
Trade and other payables 1,031 - - - 1,031
Lease liabilities 4 9 12 27 53
=========== ============== ============== ============ ==========
1,035 9 12 27 1,084
=========== ============== ============== ============ ==========
Year ended 30 June 2022
Due between Due between
Due in Due between three months one year
less than one and and one and five
one month three months year years Total
GBP '000 GBP'000 GBP'000 GBP'000 GBP '000
Trade and other payables 829 - - - 829
Lease liabilities 4 10 11 31 56
=========== ============== ============== ============ =========
833 10 11 31 885
=========== ============== ============== ============ =========
21. Capital Commitments
There were no capital commitments as at 30 June 2023 and 30 June
2022.
22. Related Party Transactions
Other than the remuneration to key management personnel outlined
in note 10 of these financial statements, there are the following
related party transactions:
Management and R&D service fees of GBP91,757 (2022:
GBP104,848) were paid to Thomas Maschmeyer Consulting Pty Ltd (FY22
- Perinato Pty. Ltd), a company with a common director (Prof Thomas
Maschmeyer) .
Remuneration of GBP6,031 was paid to a fixed term employee for
services provided to the company. The employee is a related person
of a Group Director.
Remuneration of key management personnel
The remuneration of the Directors, who are the key management
personnel of the Group, is set out in aggregate in note 10 for each
of the categories specified in IAS 24.
23. Events Subsequent to Year End
Equity fundraising through new ordinary shares issue
On 9th November 2023, the company announced that it has
successfully raised gross proceeds of GBP4.04 million via the
placement of 16,838,358 new ordinary shares at a price of 24 pence
per share. As part of the placing, the Directors subscribed for new
ordinary shares which raised gross proceeds of GBP0.4 million in
aggregate.
On 9th November 2023, the Company also announced a retail open
offer and raised GBP0.06 million at the offer price of 24 pence per
share.
On 27 November 2023, the shareholders approved both the capital
raising and the acquisition in a General Meeting.
The Company has therefore raised, in aggregate, gross proceeds
of approximately GBP4.1m through the capital raising round.
Part of net funds received were used to finance the acquisition
of Oxlid Ltd, as well as to provide working capital to advance all
current and new projects.
Acquisition of Oxlid Ltd
On 29th November 2023, the Company completed the acquisition of
100% of ordinary shares of OXLiD Ltd for a total consideration of
approximately GBP4.2 million which consists of upfront
consideration of GBP3.8 million and deferred consideration of
GBP0.4 million. The deferred consideration is subject to the
retention of the founder and will be payable equally over 12, 18
and 24 months.
OXLiD Ltd is a UK-based start-up lithium-sulfur battery company.
The Company believes that the acquisition will enhance Gelion's
presence in the UK and strategic positioning within the industry
through accelerating commercialisation of our Li-S technology in
several core areas.
The initial accounting for the business combination is
incomplete at the time the financial statements are authorised for
issue, given the proximity of the acquisition date to the date of
authorisation of the financial statements. Therefore, the fair
value of the acquired assets and liabilities could not be made. The
expected goodwill would come primarily from technology and product
synergies.
The upfront consideration was settled by 33.1% cash
(GBP1,250,000) and 66.9% in equity (amounting to GBP2,522,060, with
the issue of 10,508,582 shares valued at 24 pence per share on 29th
November 2023).
No other matter or circumstance has arisen since 30 June 2023
that has significantly affected, or may significantly affect the
Group's operations, the results of those operations, or the Group's
state of affairs in future financial years.
24. Control
In the opinion of the Directors there is no single ultimate
controlling party.
25. Alternative Performance Measures (APM)
The below non-IFRS performance measures have been used. These
measures are additional to IFRS measures and may not be comparable
with other companies. APMs should not be viewed in isolation but as
a supplementary information.
In determining whether an item should be presented as an
allowable adjustment to IFRS measures, the Group considers items
which are significant either because of their size or their nature,
and which are non-recurring. For an item to be considered as an
allowable adjustment to IFRS measures, it must initially meet at
least one of the following criteria:
-- It is a significant item, which may cross more than one accounting period.
-- It has been directly incurred as a result of either an
acquisition / divestment, or arises from a major business
change.
-- It is unusual in nature, e.g. outside the normal course of business.
If an item meets at least one of the criteria, the Board,
through the Audit and Risk Committee, then exercises judgement as
to whether the item should be classified as an allowable adjustment
to IFRS performance measures.
Adjusted EBITDA loss
Measure: Adjusted EBITDA loss is calculated excluding initial
IPO expenses (listing costs, accelerated share-based payments and
key management bonuses due to the IPO listing), other non-recurring
expenses in nature (net loss on sales of fixed assets, acquisition
of IP legal advice and IP valuation costs) and share based payments
charge.
Use: Provides a consistent measure of the profits from the core
business activities. The Company believes that adjusted EBITDA is a
useful measure because it is widely used by securities analysts,
investors and other interested parties to evaluate the
profitability of companies. This measure is closely tracked by
management to evaluate the Company's operating performance and to
make financial, strategic and operating decisions and because it
may help investors to understand and evaluate, in the same manner
as management, the underlying trends in the Company's operational
performance on a comparable basis, period on period.
Reconciliation:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Operating loss (7,557) (9,087)
Adjustments
Listing and other non-recurring costs 266 4,658
Share-based payments expense 894 49
Depreciation and amortisation 463 308
Adjusted EBITDA loss (5,934) (4,072)
========== =========
Operating loss before listing and other non-recurring costs
Measure: Operating loss before listing and other non-recurring
costs is calculated excluding initial IPO listing expenses (listing
costs, share-based payments and key management bonuses due to the
IPO listing), other non-recurring expenses in nature (net loss on
sales of fixed assets, acquisition of IP legal advice and IP
valuation costs).
Use: Provides a consistent measure of the profits from the core
business activities. The Company believes that adjusted operating
loss is a useful measure because it is widely used by securities
analysts, investors and other interested parties to evaluate the
profitability of companies. This measure is closely tracked by
management to evaluate the Company's operating performance and to
make financial, strategic and operating decisions and because it
may help investors to understand and evaluate, in the same manner
as management, the underlying trends in the Company's operational
performance on a comparable basis, period on period.
Reconciliation:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Operating loss (7,557) (9,087)
Listing and other non-recurring costs 266 4,658
Operating loss before listing and other non-recurring
costs (7,291) (4,429)
========== =========
Adjusted loss after taxation
Measure : Adjusted loss after taxation is calculated excluding
initial IPO listing expenses (listing costs, share-based payments
and key management bonuses due to the IPO listing), other
non-recurring expenses in nature (net loss on sales of fixed
assets, acquisition of IP legal advice and IP valuation costs).
Use : Provides a consistent measure of the profits from the core
business activities. The Company believes that adjusted loss after
taxation is a useful measure because it is widely used by
securities analysts, investors and other interested parties to
evaluate the profitability of companies. This measure is closely
tracked by management to evaluate the Company's operating
performance and to make financial, strategic and operating
decisions and because it may help investors to understand and
evaluate, in the same manner as management, the underlying trends
in the Company's operational performance on a comparable basis,
period on period.
Reconciliation:
Year ended 30 June
2023 2022
GBP'000 GBP'000
Loss on ordinary activities after taxation (7,407) (9,157)
Listing and other non-recurring costs 266 4,658
Adjusted loss after taxation (7,141) (4,499)
========== =========
Parent Company Balance Sheet
As at 30 June
Notes 2023 2022
GBP'000 GBP'000
Assets
Non-current assets
Investment in subsidiary 4 24,589 28,233
Current assets
Cash and cash equivalents 4,237 6,899
Other receivables 5 79 1,145
========= =========
Total assets 28,905 36,277
========= =========
Liabilities
Current liabilities
Trade and other payables 6 172 616
========= =========
Total liabilities 172 616
========= =========
Net assets 28,733 35,661
========= =========
Equity
Issued capital 7 108 107
Share premium account 7 20,752 20,662
Share-based payment reserve 7 5,510 4,635
Capital reduction reserve 7 11,194 11,194
Accumulated losses (8,831) (937)
========= =========
Total equity 28,733 35,661
========= =========
As permitted by Section 408 of the Companies Act 2006, no income
statement or statement of comprehensive income is presented for the
Company.
The financial statements of Gelion Plc, company registration
number 09796512, were approved by the Directors and authorised for
issue on 12 December 2023.
Parent Company Statement of Changes in Equity
Capital Share-based
Share Share Accumulated reduction payment
capital premium Losses reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 July
2021 33 11,251 (534) - 892 11,642
============================ ========= ========= ============ =========== ============ ========
Total comprehensive
loss for the period - - (561) - - (561)
============================ ========= ========= ============ =========== ============ ========
Contributions by
and distributions
to owners:
Bonus issue 57 (57) - - - -
Capital reduction - (11,194) - 11,194 - -
Share-based payment
charge - - - - 3,902 3,902
Shares issued during
the period 11 16,032 - - - 16,043
Shares issued during
the period through
a convertible loan 6 5,993 - - - 5,999
Costs of shares issued - (1,541) - - - (1,541)
Exercise of share
options - 178 158 - (158) 178
============================ ========= ========= ============ =========== ============ ========
Balance at 30 June
2022 107 20,662 (937) 11,194 4,635 35,661
============================ ========= ========= ============ =========== ============ ========
Balance at 1 July
2022 107 20,662 (937) 11,194 4,635 35,661
============================ ========= ========= ============ =========== ============ ========
Total comprehensive
loss for the period - - (7,894) - - (7,894)
============================ ========= ========= ============ =========== ============ ========
Contributions by
and distributions
to owners:
Bonus issue - - - - - -
Capital reduction - - - - - -
Share-based payment
charge - - - - 894 894
Shares issued during
the period 1 73 - - - 74
Forfeited / cancelled
options - - - - (19) (19)
Exercise of share
options - 17 - - 17
============================ ========= ========= ============ =========== ============ ========
Total contributions
by and distributions
to owners: 1 90 - - 875 966
============================ ========= ========= ============ =========== ============ ========
Balance at 30 June
2023 108 20,752 (8,831) 11,194 5,510 28,733
============================ ========= ========= ============ =========== ============ ========
1. General Information
Gelion Plc ('Gelion' or the 'Company') is a 100% owner of an
Australian subsidiary that conducts research and development in
respect of an innovative battery system and associated industrial
design and manufacturing.
Gelion is a public limited company, limited by shares,
incorporated and domiciled in England and Wales. The Company was
incorporated on 26 September 2015. The registered office of the
Company is at c/o Armstrong, Level 4 LDN:W, 3 Noble Street London
EC2V 7EE. The registered company number is 09796512.
Gelion Plc was incorporated as Gelion UK Ltd. On 12 November
2021, the Company was re-registered as a public limited company
under the Companies Act and its name was changed to Gelion plc.
The Board, Directors and management referred to in this document
refers to the Board, Directors and management of Gelion.
2. Accounting Policies
2.1. Basis of preparation
These separate financial statements have been prepared in
accordance with Financial Reporting Standard 101, 'Reduced
Disclosure Framework' (FRS 101). The financial statements have been
prepared under the historical cost convention and in accordance
with the Companies Act 2006.
The preparation of financial statements in compliance with FRS
101 requires the use of certain critical accounting estimates. It
also requires Group management to exercise judgement in applying
the Group's accounting policies. The areas where significant
judgements and estimates have been made in preparing the financial
statements and their effect are disclosed in note 2.21 of the
consolidated financial statements.
The following exemptions from the requirements of IFRS have been
applied in the preparation of these financial statements, in
accordance with FRS 101:
-- Paragraphs 45(b) and 46 to 52 of IFRS 2 - Share-Based Payment
-- IFRS 7 - Financial Instruments (Disclosures)
-- Paragraphs 91 to 99 of IFRS 13 - Fair Value Measurement
-- The following paragraphs of IAS 1 - Presentation of Financial Statements
-- 10(d) - Statement of cash flows
-- 16 - Statement of compliance with all IFRS
-- 38A - Requirement for minimum of two primary statements, including cash flow statements
-- 38B-D - Additional comparative information
-- 111 - Statement of cash flows information
-- 134-136 - Capital management disclosures
-- IAS 7 - Statement of cash flows
-- Paragraph 17 of IAS 24 - Related party disclosures relating to key management personnel
-- The requirement of IAS 24 - Related party transactions
relating to transactions between group members
These financial statements are presented in Great British Pounds
(GBP) unless otherwise stated, which is the Company's
presentational and functional currency. Amounts are rounded to the
nearest thousand, unless otherwise stated.
2.2. Significant accounting policies
The accounting policies of the Company are the same as those of
the Group which are set out in the relevant Notes to the
Consolidated Financial Statements, except that it has no policy in
respect of consolidation and investments in subsidiaries are
carried at historical cost, less any provisions for impairment.
2.3. Critical judgements and key sources of estimation
uncertainty
As noted in note 2.21 to the consolidated financial statements
the preparation of the financial statements requires management to
make estimates and assumptions that affect the reported amount of
revenues, expenses, assets and liabilities and the disclosure of
contingent liabilities. Company specific critical judgements are as
follows:
- Impairment of investments in subsidiaries.
The Company is making significant investments into Gelion
Technologies Pty to assist with the development and deployment of
its technologies. In assessing the carrying value of this asset for
impairment, the Directors will at the end of each reporting period
assess whether there is any indication that an asset may be
impaired including the Investment in Subsidiary. The assessment
will consider indications for potential impairment and assess the
impairment amount with reference to the recoverable amount and
carrying amount of the asset.
2.4. Share-based payments
The Group provides benefits to its employees in the form of
share-based payments, whereby employees render services in exchange
for shares or rights over shares (equity-settled transactions) in
the parent entity as per note 2.16 of the consolidated financial
statements. The only difference to that policy is that the costs
relating to share-based payments is capitalised in the parent as
part of the investment in the Group's subsidiary.
Share-based payments deemed non-recurring
The Group operated a share option plan whereby employees and key
service providers were granted options over shares in Gelion UK
Limited. Due to the Company's admission to trading on AIM which
took place on 30 November 2021 all unvested options were vested
triggering an accelerated share-based payment expense.
In addition to the existing share option plan the Group agreed
to grant options over Ordinary Shares pursuant to obligations under
the service agreements with the relevant individuals. These service
agreement obligations were triggered by admission to trading on
AIM.
Both the acceleration of option vesting and additional options
granted pursuant to service agreement obligations are triggered by
the Company's admission to AIM and therefore can be considered as
part of the same non-recurring event.
3. Results for the Year
The Company recorded a loss for the financial year ended 30 June
2023 of GBP7,894,000 (2022: loss GBP561,000). The auditors'
remuneration for audit and other services is disclosed in note 7 to
the consolidated financial statements.
4. Investment in Subsidiary
The following was a subsidiary undertaking of the Group:
Name Registered office Class of shares Holding
Gelion Technologies Pty
Limited Australia Ordinary A 100%
========================= =================== ================= ========
The shareholding is held directly.
The registered office of Gelion Technologies Pty Limited is
Level 16, 101 Miller Street, North Sydney, NSW 2060.
2023 2022
GBP'000 GBP'000
Balance as at 1 July 28,233 11,424
Additions - equity subscription 2,482 12,907
Additions - share-based payment charge 894 3,902
Less - options cancelled (19) -
Less - impairment (7,001) -
========= =========
Balance as at 30 June 24,589 28,233
========= =========
Share-based payment charges capitalised relate to the
share-based payment charges incurred by the parent company for
options granted by the parent to the employees of the
subsidiary.
As for the impairment of the investment, please refer further to
note 4.1.
4.1. Impairment of Investment in Subsidiary
The Company tests the net recoverable amounts of assets annually
for impairment, or more frequently if there are indicators of
impairment. During the year, Management considered the
recoverability of its investment in subsidiary, which is disclosed
in Note 4. The subsidiary continues to operate, incurring research
and development activity and generates losses, which is seen as
temporary. The fair value measurement of this investment is
classified as Level 1 under IFRS 13.
Gelion Technologies Pty Limited (100% subsidiary of Gelion plc)
is responsible for well over 95% of Group activities, along with
the future revenue opportunities (currently being the only centre
for R&D and the sole manufacturing entity). As such, this
single cash generating unit contributes significantly to the market
capitalisation of the Group (and parent company, listed on
AIM).
Since the Company is pre-revenue, the directors do not think the
value in use to be an appropriate measure to determine recoverable
amount. The directors have therefore considered the market
capitalisation less relevant adjustments as a proxy in the 'fair
value less costs to sell' assessment'.
The market capitalisation of the Group on 30 June 2023 was
GBP28.7 million (108,407,750 shares at the share price of 26.5
pence). Certain adjustments were made to the market capitalisation
being the cash balance (GBP4.2 million) and net payables (GBP0.1
million) in the parent company at 30 June 2023 resulting in the
indicative carrying value of GBP24.6 million.
In comparing the cost of the total investment (GBP31.59
million), the indicative carrying value of GBP24.6 million
represents an impairment of GBP7.0 million to be recognised in the
current year. If this exercise was undertaken on 30 November 2023,
the impairment would decrease by GBP1.6 million to GBP5.4
million.
The Company will continue to assess the recoverable amount of
its investment in subsidiary annually or whenever there are
indications of impairment, in accordance with IAS 36. Any
subsequent changes in the recoverable amount and impairment losses
will be recognized in the financial statements in the periods in
which they occur.
5. Trade and Other Receivables
As at 30 June
2023 2022
GBP'000 GBP'000
Short term deposits - 1,017
Prepayments 50 63
Other debtors 29 65
79 1,145
========= =========
Term deposits in FY22 comprised cash deposits held by UK
licensed banks for a period of greater than three months, over
which there is no recall during the term of the deposit. The
amounts are measured at amortised cost using the effective interest
method in line with IFRS 9. There were no term deposits for a
period greater than three months as of June 2023.
6. Trade and Other Payables
Due within one year
As at 30 June
2023 2022
GBP'000 GBP'000
Trade payables 28 19
Amounts owed to Group companies 59 342
Accruals 85 255
========= =========
172 616
========= =========
7. Share Capital
Details of the Company's share capital are as set out in note 18
to the consolidated financial statements.
Details of the Company's share premium account and other
reserves are as set out in note 18 to the consolidated financial
statements.
Details of the movements in retained earnings are set out in the
parent company Statement of Changes in Equity .
8. Related Party Transactions
Year ended 30 June
2023 2022
GBP'000 GBP'000
Management fees - 89
Arrangement fees - 119
- 208
============================== =========
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END
FR EAFAAFSFDFFA
(END) Dow Jones Newswires
December 12, 2023 07:00 ET (12:00 GMT)
Gelion (LSE:GELN)
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Gelion (LSE:GELN)
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