Swedish Stirling prepared for prolonged financial unrest
Swedish Stirling AB is implementing an action programme considering Covid-19 and the world economic uncertainties. Re-prioritisations and project postponements will yield immediate savings of MSEK 1/month. The company's estimation is thereby that the cash reserves will last into 2022, even with no revenue.
The Swedish clean tech company Swedish Stirling has decided, considering Covid-19 and the world economic uncertainties, to implement an action programme to equip the company for a prolonged crises. The company is financially very strong today with good liquidity, thanks to the share issue of SEK 47 million and the convertible bond issue of 100 million, which were announced in the beginning of March. The purpose of the measures that the company's management team and Board of Directors have now resolved on is to secure the business even if the crisis is of long duration, while at the same time ensuring that the company retains the ability to quickly switch gears if the situation improves. The company has already taken measures internally to limit the transmission of disease in society to the greatest extent possible.
“With the 2008 financial crisis fresh in our minds, we won’t hesitate to act resolutely but with great care so as not to damage what we have built with our hard work and a great deal of capital. The action programme consider both what we do know and what we don’t know about the new world economic situation. We will be stronger if the situation soon changes for the better, but are ready to ride out the storm if needed,” says Sven Sahle, Chairman of the Board and largest owner of Swedish Stirling.
The action programme, which is primarily a matter of setting new priorities and pushing already approved projects further into the future, provides Swedish Stirling with immediate savings of MSEK 1/month. The overall goal is to quickly cut costs without damaging or jeopardising the business built up, while being able to quickly revert to current plans if the situation normalises. Entered agreements and customer projects are adapted to the needs and situation in consultation with the customers. The efforts do not affect jobs in Sweden and South Africa. The measures include:
- Swedish Stirling and Afarak Mogale jointly decide to end the energy conversion project at Afarak Mogale. Both parties strive for a long-term business relationship and have committed to revisiting the energy conversion project when market conditions improve. Equipment and personnel will be moved to Swedish Stirling’s other pilot project to save costs.
- Renegotiation of agreements with consultants and suppliers will be carried out and implemented immediately, and the development of PWR BLOK (gen. 3) will be postponed by up to six months.
- The planned listing on the Nasdaq Main Market is postponed until further notice. The listing process can be reactivated with six months' notice.
“Over the past two weeks, we have quickly adapted to the new dramatic situation in the world and have identified good solutions in collaboration with our customers and suppliers. For Swedish Stirling, this means that the company’s current estimate is that the cash reserves will last well into 2022, even in the event of no revenue or advance payments. The price we pay will be in the form of postponing deliveries by half a year, while retaining our effectiveness as a company,” says Gunnar Larsson, CEO of Swedish Stirling.
“It's especially sad that we have to finish the project at Afarak Mogale. They have given us support, assistance and, not least, the opportunity to quickly start testing PWR BLOK. I really hope that we can come back and find a new collaboration when the market conditions have improved”, says Gunnar Larsson, CEO of Swedish Stirling.
Swedish Stirling has also decided to continue the work to recruit a head of sales and marketing, an effort that it has previously communicated. The background here is that the company believes the uncertainties increase the risk inherent in focusing on a single market, and that it needs to, according to plan, begin efforts to cultivate other markets where great interest in PWR BLOK has been shown.
For further information please contact:
Sven Ljungberg, CCO, Swedish Stirling AB, +46 (0)31 385 88 30 ir@swedishstirling.com.
About Swedish Stirling
Swedish Stirling AB is a Swedish clean tech company founded in 2008 with a mission to further refine the incomparable ability of Stirling technology to convert thermal energy to electricity. The company’s latest product – the PWR BLOK 400-F – is a unique proprietary solution for recovering energy from industrial residual and flare gases and convert them to 100 % carbon-neutral electricity with high efficiency. The PWR BLOK is – according to independent certification – the cheapest way of producing electricity that exist today and gives greater CO2 savings per invested Euro than any other type of energy source. The company’s shares are listed in Sweden on the NGM Nordic SME. Read more at www.swedishstirling.com
This information is information that Swedish Stirling AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 15.00 CET on 2 April 2020.