News blog

VPhase

• BY: Andrew Hore |
• POSTED: 01/10/2012 |

Voltage optimisation equipment supplier VPhase continues to grow its revenues even though its Australian contract is yet to make a significant contribution. 

Revenues more than trebled from £201,000 to £658,000 in the six months to June 2012 but progress is not as rapid as analysts expected. Most of the revenues come from social housing customers. Overheads have been cut and this helped to reduce the interim loss from £1.08m to £805,000.

The Australian contract is worth £12.4m over five years if expected volumes are achieved. A new Cypriot deal is worth £630,000 over three years. There are further potential deals in the Netherlands, Poland and Malta.

Volume manufacturing will help to boost future margins. VPhase is developing new versions of its product – the VX2 (2kw version) and VX5 (5kw version) – and these will be launched in November.

House broker Panmure Gordon expects a full year loss following a reduction in forecast revenues and it no longer believes that VPhase can break even in 2013.

There is cash in the bank of £1.35m at the end of June 2012, following a £599,000 cash outflow from operations in the six months to June 2012. There was also £112,000 of capitalised development spending. Management believes that it has enough cash for its immediate needs. A factoring agreement will provide a further £500,000 of finance.

At 0.7p a share, VPhase is valued at £8.95m.

Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFSeptember2012_36.pdf