Renewable energy has been a focus at Pinnacle for the past few months as conventional energy sources such as oil and coal continue to get hammered amidst policy implementation in Canada and abroad. Companies pushing for market share in the lithium ion battery space, such as Electrovaya, are commanding our attention.
Electrovaya: emerging clean energy company builds Lithium battery storage system
Electrovaya (EFL:TSX) is a well-positioned Canadian manufacturer of proprietary Lithium Ion Super Polymer® batteries, battery systems, and battery-related products for energy storage. As global dependence on renewable energy increases, natural demand to store renewable energy should also increase.
Electrovaya finds strength in Litarion GmbH
Electrovaya‘s two most notable accomplishments in the past 6 months had to be its Q3 2015 revenue increasing by 900% quarter over quarter; followed by its wholly owned subsidiary, Litarion GmbH, signing a contract “for about Euro 18.5 million (Cdn $ 27.3 million) to supply Lithium Ion battery products to a German company in the non-automotive space.”
source: http://www.electrovaya.com/pdf/PR/2015/PR20150901.pdf
Clean Energy Canada, a climate and energy think tank, released a well-researched report titled Tracking the Energy Revolution: the Top 10 Trends Propelling the Global Clean Energy Transition.
In our latest Weekly Volume titled Goodbye Oil, Hello Renewables, which focused on the coming COP21 summit on climate change, we highlighted a few key takeaways from Clean Energy Canada’s report:
“In total, investors poured twice as much money into new renewable-electricity projects than into new fossil fuel projects.” (in the year 2014)
And that:
“Last year financiers moved USD$295 billion into renewable electricity-a 13 percent bump from 2013.”
Click here to read the entire report by Clean Energy Canada.
Renewable energy companies take centre stage in Canada
This is good news for renewable energy companies and Electrovaya who designs, develops and manufactures its proprietary Lithium Ion Super Polymer® batteries, battery systems, and battery-related products for energy storage.
In addition to Electrovaya’s lithium battery production and storage capabilities, the company, through its fully owned subsidiary, Litarion GmbH, produces cells, electrodes and SEPARION™ ceramic separators and has manufacturing capacity of about 500MWh/annum.
Justin Trudea’s Liberal victory, which we wrote about here, is key benefactor to Canadian renewable energy companies, which includes Electrovaya as it is Headquartered in Ontario, Canada. Policy implementation is speeding up an already global shift to clean energy. Electrovaya’s production facilities are locted in Canada and Germany and, according to the company, have customers around the globe.
German engineering adds power to Electrovaya’s bottom line
Dr. Sankar Das Gupta, Electrovaya CEO, commented in late-July following the company’s 900% increase in revenue QoQ, that:
“Our 100% owned German acquisition is a remarkable asset with technology and engineering depth that combines beautifully with Electrovaya’s patented, non-toxic production processes.”
And continued,
“Electrovaya now has the technology and manufacturing capacity to become the world leader in clean Lithium Ion energy storage solutions.”
Click here to read the entire press release from July 29th.
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While the company’s revenues are growing, and will likely continue following its September 1st announcement that its wholly owned subsidiary, Litarion GmbH, has signed a contract for about Euro 18.5 million (Cdn $ 27.3 million), the company is still technically in the red. Check out the below highlights from Q3 2015:
“Financial Highlights:
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Q3 2015 revenue was $6.0 million, over 900% growth as compared the pre-acquisition Q2 2015 revenue of $0.6 million
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Adjusted EBITDA1 was negative $0.8 million for Q3 2015, as compared to pre-acquisition Q2 2015 of negative $1.1 million
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Q3 2015 Cash and Cash Equivalents totaled $3.2 million as compared to pre-acquisition Q2 2015 of $0.7 million
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$9.2 million comprehensive gain on Litarion acquisition”
Click here to read the company’s entire Q3 financials, reported on July 29th, 2015.
Electrovaya – 1 Year Chart
In a Globe and Mail article titled Six Canadian companies shaping the future of clean energy, from March of 2014, a key differentiation in Electrovaya’s technology is revealed. Below is an excerpt from the article written by Richard Blackwell:
“Electrovaya’s toxin-free production process, along with technology that squeezed more energy into a smaller space, has garnered the company more than 150 patents and has given it a toehold in a tough but huge market.
Its clients include a Norwegian ferry company, a Chinese automaker and a British electrical utility that is buying more than two dozen large-scale power-storage systems.”
Click here to read the entire article.
The timing of Electrovaya‘s recent breakthrough and increase in revenues could go a long way as weary resource and conventional energy investors look to diversify. Electrovaya’s 4th quarter results are on deck and will likely impress, given the company’s $27 million contract reported on September 1st. Expect renewable energy stories to get more play from new school analysts and a wider investment audience in the coming quarters.
This article represents solely the opinions of Alexander Smith. Alexander Smith is not an investment advisor and any reference to specific securities in the list referred to in the article does not constitute a recommendation thereof. Readers are encouraged to consult their investment advisors prior to making any investment decisions. The information in this article is of an impersonal nature and should not be construed as individualized advice or investment recommendations.
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