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2012 Annual General Meeting
Brendan Dow
Managing Director
29 October 2012
Agenda
Review of FY12
– Sales & Marketing
– Products
– Manufacturing
Corporate Restructure
Targets for FY13
North Rhine Westphalia market introduction program
Current Status CFCL has commercialised its technology into products and is selling to customers and through local distributors
Our technology has a clear competitive advantage – Higher electrical efficiency creates more value for customers
Revenue and Sales growth of ~80% p.a.
German manufacturing plant built and operating
Increased policy support in key markets (Germany, UK)
Raised $11.6m in September 2012
Cutting costs and focusing activities in key markets
Review of FY12 Sales & Marketing
Units sold up by 177%, from 61 to 169
82% increase in sales revenue, to $6.7m
78% of sales from Germany, The Netherlands and the UK
Order for up to 60 mCHP units and 45 BlueGen units from E.ON UK
New product website, www.bluegen.info – in English, German and Dutch
Presented at conferences in Japan, Germany, UK, USA and Australia
Prime-time media exposure in the UK and Australia
Increasing Sales
0
50
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300
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Un
its
Unit Sales
Quarterly (LHS)
Cumulative (RHS)
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
$8.0
FY 09 FY10 FY11 FY12
CFU Revenue (AUD m)
Review of FY12 Products
Trained local installation, service and support companies in Australia, UK & Germany
Expanded BlueGen-net remote monitoring service
Over 1m hours of combined operation
Reorganised internal service & support structure, field engineers in the UK and Germany
Technical improvements achieved; ongoing progress towards commercial targets for lifetime & reliability
BlueGen-net
Interactive global map of all units
On-line product monitoring and support by CFCL
For each unit: detailed log of all performance data,
maintenance and support actions
Shows status of all units, click through to dedicated
screen for each unit
Review of FY12 Manufacturing
Supply agreement with new supplier of fuel cell components, Three Circles, for increased volumes and lower costs
Ongoing work with other key component suppliers
Working to fully commission a large furnace and increase production volumes in Germany
Component costs reduced by an average of 25% from 2011 to 2012/13
Corporate Re-structure Results
A leaner organisation focused on European markets – Near term sales opportunities
– Favourable market settings
European Sales team strengthened and self sufficient
Board and Executive Team reduced
Component manufacturing at Noble Park outsourced
Supply chain shortened and simplified
Technology development delivering – Lower product costs
– Product reliability and compliance
Corporate Re-structure
Sales & Marketing
Heerlen (Netherlands)
Manufacturing
Heinsberg (Germany)
Technology & Supply Chain
Noble Park (Australia)
Finance & Corporate
Results continued…
Headcount reduced by 56 since 1st July 2012
Forecast overhead cost reduction of $5m per year
Simplified organisation structure:
Targets FY13 Sales
Continue strong revenue growth, translate the order book into sales and cashflow
Expand direct sales networks in Germany, UK and Benelux
Faster sales from distributors in Germany and Netherlands: – Complete the first orders of 100 units; order for 500 units in Germany
Secure larger orders from Utilities with fixed delivery dates
Deploy BlueGen units into large scale Virtual Power Plants
Deliver all units to EWE in the German NOW project and secure commercial market introduction of integrated mCHP product
Increase sales in UK through Resellers/Installers, Housing Associations, new build home contractors
Targets FY13 Products & Services
Finalise integrated mCHP product design and commence deployment with EON UK
Work with service partners to make it faster and cheaper for customers to install our products
Continue to transfer after-sales activities to local service partners
Release next version of BlueGen-net with updated customer control functionality
Continue to improve product performance, including longer stack lifetime and longer mean time between failure
Targets FY13 Manufacturing
Outsource remaining production activities and selected component supply from Noble Park to supply partners
Secure and implement agreements with remaining key component suppliers to increase scale and further reduce costs
Improve operational efficiencies to increase Heinsberg output without additional capital expenditure
Upgrade 2nd large furnace for additional capacity of 1,500-2,000 stacks per year
Targets FY13 Financial
Realign corporate structure and operational activities to substantially reduce overhead costs
Reduce operational cash burn by removing production activities from Noble Park, relocating responsibility for operational activities to Germany and refocusing Noble Park as our Technology Centre
Complete the implementation of the enterprise resource planning (ERP) system and processes
NRW Market Introduction Program North Rhine Westphalia (NRW) subsidy for mCHP products
Subsidy to commercial customers and Energy Service Companies to install mCHP products <50 kW
Subsidy varies between categories of products and related projects
CFCL estimates a subsidy of approx €10,000 per unit – Actual subsidy amount decided by Government body, based on cost of
reference product
Program begins now, due to run until the end of 2017
Part of NRW Government funding of €250 million for CHP – NRW is the most populous State in Germany (~18 million people)
– CFCL employs ~30 staff at our manufacturing plant in NRW
– NRW Environment Minister helped launch the BlueGen Virtual Power Plant on 2 October
NRW Market Introduction Program Value for Customers
Benefits for CFCL
Takes away ‘sticker shock’: makes products cost competitive
Drives sales volumes, which in turn reduces costs further
Estimated value model for a commercial customer:
BlueGen installed price € 30,000 Estimate, including installation, ex VAT
NRW Subsidy - € 10,000 Estimate
Federal Subsidy - € 1,650
Net price € 18,350
Return per year € 2,600
Estimate: avoided grid price and taxes, + feed in tariff + heat benefit
Payback 7 years
Trianel VPP
Virtual Power Plant of 25 BlueGen units Opened in Aachen, North Rhine Westphalia
on 2 October 2012 by Mr Peter Altmaier, Germany’s Minister for the Environment
Questions
19
More information...
www.cfcl.com.au
Register to receive Email Alerts
News & announcements
Webcasts
www.bluegen.info Product information
Carbon calculators
Case studies Updated IMG
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© Ceramic Fuel Cells 2012