Year-end Report January-December 2019
Year-end Report January-December 2019
2019 at a glance – group
- Net turnover decreased to 92.0 (185.2) MSEK
- Order bookings decreased to 83.6 (182.9) MSEK
- Operating costs decreased to -186.8 (-247.0) MSEK
- Operating income amounted to -65.5 (-37.0) MSEK
- Net profit or loss amounted to -78.2 (-41.2) MSEK
- Cash flow from operating activities -47.8 (-13.5) MSEK
The fourth quarter 2019 at a glance – group
- Net turnover decreased to 7.5 (41.8) MSEK
- Order bookings decreased to 3.8 (37.5) MSEK
- Operating costs decreased to -31.7 (-74.0) MSEK
- Operating income amounted to -16.5 (-24.4) MSEK
- Net profit or loss amounted to -17.1 (-26.8) MSEK
- Cash flow from operating activities 3.2 (-1.6) MSEK
Significant events during 2019
- Alelion GmbH was declared bankrupt and operations were integrated with the Parent Company.
- Alelion made a new share issue in May that was fully subscribed and contributed 135 MSEK before deductions for transaction costs. A bridging loan of 50 MSEK and corporate bond were repaid.
- Contracts were signed with MHE Energy in Thailand and with GamaAku in Turkey to supply lithium-ion batteries and service for the industrial forklift truck aftermarket.
- Lennart Sparud was appointed as a new member of the board.
- The board decided in August to replace Daniel Troedsson as Company CEO.
Significant events during The fourth quarter 2019
- The Company carried out changes in management in order to increase company focus on customers and markets and to better coordinate production and product development.
- Alelion signed a framework contract with Finnish Cargotec to develop and supply high voltage batteries for electrification of the company’s various industrial vehicles. On signing the contract Alelion received an order from a Cargotec subsidiary to develop and deliver two high voltage battery prototypes.
- Alelion signed a contract with the Swedish construction machinery manufacturer Huddig AB to develop high voltage batteries. These are hybrid batteries to be used in the development of a hybrid model of the Huddig backhoe loader and excavator, “TIGON”. The order includes development and production of an initial prototype battery and delivery is expected during the second quarter 2020. Total worth is around MSEK 1.8.
- Alelion Energy Systems high voltage batteries meet certification requirements for road vehicles, thus opening up new opportunities in the special vehicle sector.
- Åsa Nordström was appointed as new CEO for Alelion Energy Systems AB.
Significant events after this quarter
- On the date of publication, the Company lacks liquid assets and cash flow to further operate over the coming 12 months. It is the board’s assessment that the Company’s cash at bank and in hand will be consumed within four months if new capital is not added. To secure continued operations and repayment of outstanding current liabilities a new financial solution must be implemented. By means of guarantees from major owners, Alelion will in the immediate future extend a loan of 30 MSEK until 31 March 2021. Talks are underway regarding operating credit to secure financing for implementing the business plan.
- Tests made by the Swedish Research Institute, Rise, confirm the quality of the new flexible module based batteries that Alelion Energy Systems are constructing in our own highly automated assembly line. The tested battery modules are constructed using various types of cells and configurations but have all met the high standards required for approval in accordance with UN 38.3, a so-called transport certification.
- Alelion Energy Systems is widening its network in the industrial forklift truck battery aftermarket through a distributor contract with the Sjuntorp Group. This contract involves sales and service of Alelion lithium-ion batteries for industrial trucks.
Comments from the CEO
Our biggest customer’s decision in spring 2019 to start manufacturing their own lithium-ion batteries for their forklift truck fleet led to consequences that have affected our sales and our profits negatively even during the fourth quarter. To manage this situation, Alelion not only reduced costs and increased endeavours to build a position in the special vehicle industry, but also intensified relations with smaller manufacturers and users in the industrial forklift truck sector. Our financial situation is under strain but a number of measures are underway to ensure financing for the implementation of the business plan for the coming year.
Efforts to adapt the organisation’s costs to the new conditions commenced at an early date. However, the major challenge is on the income side where it will be critical to launch new business, as there is a limit to how far costs can be reduced without negatively affecting the Company’s capacity. Intensive efforts are being made to work with both existing and new customers where we hope and believe these will bear fruit and in turn bring the anticipated results.
During the fourth quarter we launched our new Generation 3 products on a wide front. These have now been certified for use in road-going vehicles and meet UN transport regulations for lithium-ion batteries. This means that Alelion is now one of a small number of manufacturers that can offer lithium-ion based solutions for the large road-going vehicle segment.
Compared with a year ago we are today fully equipped to meet new customers and to handle growing volumes in our new factory. We have a module based product generation that enables us to meet new customers’ requirements regarding capacity, power and customized design with fewer adjustments. Thanks to our built-in flexibility in the new assembly line, we today use several different types of battery cells further strengthening our competitiveness and our ability to meet customers’ demands.
A transition towards more sustainable and energy efficient solutions continues to drive the market where lithium-ion batteries account for a growing section of the industrial solutions to replace even fossil fuels. Against a background of the need for conversion, the market for lithium-ion batteries for special vehicles is expected to show vigorous growth. It is calculated that the global market will have grown to around 15 billion SEK by 2029. A figure that rises with every new industrial sector that recognises the opportunities offered by lithium-ion.
Before the close of the quarter the board expressed their continued confidence in me as CEO for the Company – a task I have met with enthusiasm and dedication as well as humility. We have already started taking measures to increase customer focus and to shorten the timespan for developing new products but both time and patience will be needed before we see the results of the changes being made. Our challenge this year will be to establish our new business and our business segments at a pace that will maintain our financial position intact and fairly robust. One thing that is however certain – I would never have shouldered this task had I not been convinced that we have every possibility of success.
Åsa Nordström
CEO Alelion Energy Systems AB
Financial calendar
24-04-2020 – Annual Report 2019
22-05-2020 - First-quarter Report January-March 2020
28-05-2020 - Annual General Meeting 2020
28-08-2020 - Six-month Report January-June 2020
17-11-2020 - Third-quarter Report January-September 2020
12-02-2020 – Year-end Report 2020
Auditors’ review
This financial report has not been subject to a review by the Company’s auditors.
Declaration from the CEO
The CEO declares that this quarterly report is a fair review of the Company’s operations, position and income and the report describes critical risks and uncertainties the Company faces.
Gothenburg, Sweden 13 February 2020
Åsa Nordström
CEO
For more information, please contact:
CEO Åsa Nordström telephone +46 70 290 18 58, e-mail: asa.nordstrom@alelion.com
The complete report is attached to this e-mail or can be read at:
https://www.alelion.com/en/Investor/Financial-reports
CEO Åsa Nordström +46 702 90 18 58, e-post: asa.nordstrom@alelion.com
Direct link to Investor Area:
https://www.alelion.com/en/Investor
Alelion Energy Systems AB
Sörredsbacken 4
SE-418 78 Göteborg
www.alelion.com
Org nr: 556710-7916