TIDMTRK
RNS Number : 6440K
Torotrak PLC
20 April 2015
20 April 2015
Torotrak plc
("Torotrak" or the "Group")
Trading Update
Torotrak (LSE: TRK), a leading developer and supplier of
emissions reduction and fuel efficiency technology for vehicles, is
pleased to today announce a trading update in respect of the 12
months ended 31 March 2015 ahead of its preliminary results
announcement in early June 2015.
Management Changes
On 30 March 2015, the Group announced the appointment of Adam
Robson as Chief Executive (effective 13 April 2015), who took over
from Jeremy Deering, who had previously stated his intention to
stand down in November last year. Adam's track record in
commercialising technology and experience in the automotive sector,
will prove invaluable to Torotrak as it furthers discussions and
negotiations with customers and partners directed at bringing
products to market based on its world class technologies.
Trading and Financial Update
In the half year results published in November last year, we set
out the key objectives for the Group for the following six months.
The Group has made significant progress against all of these
objectives, both in terms of technical development and heightened
commercial engagement with Tier 1 and OEM partners, and the Board
remains encouraged with the prospects and significant opportunities
for commercialising the Group's technologies.
The Group expects to close the financial year ended 31 March
2015 with at least GBP7.5m in cash; the Vendor Loan Notes of
GBP2.8m remain outstanding. Based on the Group's working capital
requirements to fund existing projects and to optimise the
realisation of the value of its product development and
commercialisation programmes that are underway, additional funding
from partners, licensees or new and existing shareholders is likely
to be required during the 2015/16 financial year. The Board
continues to actively review the Group's priorities and optimise
its cost base to ensure it is focused on the key strategic
priorities and near term commercial opportunities.
Progress against Objectives
The following is a summary of the progress made under each key
objective.
Completion of bus KERS trial
We announced that a Flybrid KERS-equipped Wrightbus StreetLite
vehicle entered service last month operated by Arriva on a public
bus route in Gillingham, Kent. This followed a period of extensive
functional and flywheel safety tests and in-vehicle roadworthiness
testing. Initial feedback from passengers and drivers in terms of
drivability and performance has been extremely positive. The trial
is anticipated to continue for at least 3 months during which time
operational performance of the KERS system will be monitored
through the collection and analysis of in-service data that will be
used to confirm the in-service performance of the unit.
Announce bus KERS manufacturing strategy
The Group has been working in close collaboration with a major
global Tier 1 manufacturing and assembly partner that is a
technology leader in commercial vehicle and light vehicle driveline
systems. The collaboration is focused on delivering, in the volumes
required by bus operators, the new productionised bus KERS system,
leveraging the knowledge, experience and supply chain relationships
of the Tier 1. Based on the work completed, the Group remains
extremely confident that it can achieve the target product cost
underpinning the bus KERS business case and meeting the payback
target for bus operators with a commercial launch in Q2 2016.
Commence design verification of industrialised bus KERS
The production ready design for the low cost industrialised bus
KERS system has been completed and the first units are currently
being assembled at the Group's facility in Leyland. These initial
units will be used as part of a comprehensive design verification
test programme to validate the functional performance, reliability
and improved fuel efficiency of the KERS system. In parallel, the
combined engineering teams of our Tier 1 partner and the Group's
development team will continue to focus on optimising the design
for manufacture, reliability and cost.
Build a pipeline of KERS commercial opportunities
The commercial team is working closely with our bus OEM partner,
Wrightbus, and a number of bus operators to secure initial sales
orders for the bus KERS system during the next 6 months. The
results from the current in-service trial with Arriva,
demonstrating the performance of the KERS system, are an important
validation for these on-going discussions. We expect to be able to
provide a further update on the bus trials at the time of the
Group's preliminary results announcement. The recent announcement
by the UK Government's Office for Low Emission Vehicles of a GBP30
million fund for Ultra Low Carbon Bus procurement is a welcome
initiative to encourage bus operators to procure new low carbon
vehicles. We will be working with our partner Wrightbus to ensure
that the Flybrid KERS equipped StreetLite is eligible for grant
funding under this scheme.
Commence testing of JCB flywheel system
The on-going product development programme with JCB to design,
develop and commercialise Flybrid flywheel systems for excavators,
is also progressing to plan. Testing of flywheel systems in
machines and on rig is encouraging. The combined engineering and
procurement teams are already engaged with supply chain partners
working on cost reduction activities.
Supply next generation V-Charge unit
The next generation V-Charge hardware has been built and
supplied to our OEM partner, in preparation for engine testing. The
OEM is planning to evaluate V-Charge comparing the technology with
incumbent boosting solutions in a premium two stage
application.
Develop KERS Tier 1 licensing opportunities
The Group is engaged in discussions with several Tier 1 and
several OEM partners about the opportunities to license KERS and
V-Charge in applications including passenger cars. These
discussions are on-going.
Additionally, we have today made an announcement concerning the
progress achieved on the Innovate UK (previously Technology
Strategy Board) backed Smart Project to develop a production
orientated version of V-Charge and confirming the participation of
Ford Motor Company to evaluate the potential benefits of V-Charge
technology in engine downsizing.
Work is on-going with Allison to evaluate the opportunities
arising from the improved IVT durability demonstrated last year and
the significance of this for in-vehicle applications.
Flybrid
One year on from the acquisition of Flybrid, the Board is very
pleased with the capability and potential of its high-speed
flywheel KERS technology and the significant opportunities both in
on and off-highway commercial vehicles and passenger cars. The
technology has demonstrated that it is robust, reliable and has the
potential to deliver significant fuel efficiency and emissions
reductions benefits to vehicle manufactures and operators at the
lowest cost. The application engineering to install KERS into a
Wrightbus StreetLite bus has taken longer than expected but the bus
is now in-service on a public bus route operated by Arriva and we
are confident that this will not only demonstrate the technologies
in-use capabilities but also re-confirm that the technology can
deliver the required payback to bus operators. The inherently
robust and low-cost mechanical design offers significant through
life benefits over alternative electric battery-based
solutions.
Summary
The Group has made, and continues to make, significant progress
in commercialising all of its technologies, particularly in respect
of KERS and V-Charge and, in addition, is engaged in commercial
discussions with a number of parties about potential new
applications for its technology and new commercial development
programmes. The Board is reviewing the key objectives for the
2015/16 financial year, including funding, organisation, resources
and other requirements in order to optimise plans to commercialise
its technologies, and these will be set out in the Group's
Preliminary Results Announcement due in early June 2015.
Adam Robson, Torotrak's Chief Executive said; "I have joined
Torotrak at a very opportune moment. A great deal of good work has
been done to advance our technologies towards production and our
engagement with commercial partners reflects the increasing
interest in our low cost technology solutions. Now we are
organising ourselves into dedicated teams each focussed on
delivering against our priority objectives to deliver value from
the technology, commercialise our portfolio of products and deliver
long term shareholder value."
For more information, please visit www.torotrak.com or
contact:
Torotrak plc +44 1772 900 931
Adam Robson, Chief Executive
Rex Vevers, Finance Director
Charles Stanley Securities (Joint Financial Adviser & Joint
Broker) +44 20 7149 6000
Marc Milmo / Karri Vuori / Carl Holmes
Cantor Fitzgerald Europe (Joint Financial Adviser & Joint
Broker) +44 20 7894 7000
Rick Thompson / Will Goode / David Banks
Tavistock +44 20 7920 3150
Simon Hudson / James Collins
Notes to editors
Torotrak is a leading developer and supplier of variable drive
transmission, engine boosting and kinetic energy recovery systems
for vehicles. Our portfolio of technology solutions substantially
improves fuel economy and reduces CO(2) emissions in vehicles
through harnessing the power of supercharging to enable engine
downsizing, capturing and recycling energy that would otherwise be
lost and managing the engine at the optimum point.
-ends-
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTDBGDSLDBBGUC
Torotrak (LSE:TRK)
Historical Stock Chart
From Mar 2024 to Apr 2024
Torotrak (LSE:TRK)
Historical Stock Chart
From Apr 2023 to Apr 2024
