OXE Marine AB (publ) Interim report 1 January to 31 March 2020
First quarter of 2020
Net turnover of SEK 10.3 m (SEK 3.6 m)
Operating Loss/EBIT of SEK -17.6 m (SEK -27.2 m)
Net loss for the period of SEK -19.6 m (SEK -33.1 m)
Cashflow for the period SEK 13.5 m (SEK 9.2 m)
Earnings per share amounted to SEK -0.12 (SEK -1.12)
Significant events in the First quarter
The company name changed from Cimco Marine AB (publ) to OXE Marine AB (publ)
The company announced its vision, mission and core values.
Directed issue of in total 14 726 154 warrants to the European Investment Bank (“EIB”).
19 March: The company released a business update and its COVID-19 response.
The company received EUR 4 m in funding, relating to Tranche B of the EIB facility.
Significant events after the reporting period
- 20 April: Q1 2020 preliminary results and business update were released.
Comments by the CEO
The COVID-19 crisis has impacted all of us both socially and economically. As a business, our main priority is safety of our staff and consultants. The measures we have in place, following guidelines from the WHO and local authorities, have so far proved effective. Nonetheless, the crisis has severely affected our business ecosystem in the near term.
Our supply chain, which is predominantly global has been disrupted and the Company has had to take appropriate action to ensure continuity of business – particularly with the focus on the start of production of the OXE300, which has now been delayed to July 2020, and the re-start of production of the OXE200. We have now taken the necessary actions as laid out in our press release dated 20th April 2020 and continue to monitor the situation. In some ways our “asset light” business model has enabled us to scale down operations quickly without the burden of high fixed costs or legacy assets. This will give us the resilience and ability to scale back up very quickly.
Our sales in the short term have been impacted as well, especially since mid-March, where we have had orders deferred due to COVID-19. Nevertheless, our order book has increased by over 30% during Q1, from SEK 43m to SEK 56m. The order intake was mainly related to the higher margin OXE300. Additionally, we have received SEK 12m in deposits against these orders, demonstrating commitment from our customers. Based on the
current status, we expect to meet our financial objective of achieving 50% year on year growth in revenue for 2020.
Our Q1 results compare favourably to Q1 2019. We achieved net turnover of SEK 10.3m (SEK 3.6m) whilst achieving gross margin of 23% (-297%) – the best quarterly margin by the Company to date. We expect some volatility to this margin, but the trend is generally upwards, particularly when we start to deliver the OXE300s in Q3.
We have had a very good production run during Q1 with little or no downtime. The quality of the product is continually being improved and this is reflective in our testing with minimum corrective issues of the final assembled product before delivery. The supply chain disruption for the OXE200 has meant a production stop at UFAB in Uddevalla. There are now plans to re-start production with alternative partners later this year. The Company has sufficient number of units in inventory to meet its sales targets for Q2 and Q3. Pre-series production of the OXE300 will commence later in May whilst series production will start in July.
The Company’s cash burn rate has reduced during the reporting quarter relative to Q4 2019. The company had satisfied all conditions to enable draw down of Tranche B of the European Investment Bank (“EIB”) Loan facility of €4 m which was completed on 31st March 2020.
The Management and the Board remains confident of the future and our pro-active approach to these volatile times will enable us to continue business and plan to sensibly scale up the business from Q4 2020 onwards.
Myron Mahendra CEO - OXE Marine AB
For further information, please contact:
Myron Mahendra, CEO, firstname.lastname@example.org, +46 76 347 59 82
Anders Berg, Chairman, email@example.com, +46 70 358 91 55
FNCA Sweden AB is Certified Adviser for OXE Marine AB (publ). Contact details to FNCA Sweden AB: tel. +46 8 528 00 399, e-mail firstname.lastname@example.org.
OXE Marine AB (publ) is obligated to make this information public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, on 22 May 2020 at 11.00 CET.
OXE Marine AB (publ) has, after several years of development, constructed the OXE Diesel, the world's first diesel outboard engine in the high-power segment. The Company’s unique patented engine-to- propulsion power transmission solutions have led to high demand for the Company's engines worldwide.