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Positive signs of growth for AIM-listed Powerhouse Energy?


Powerhouse Energy LON:PHE, the AIM-listed waste-to-energy (WTE) company, could be in the foothills of a turnaround.

The Cottingley-based company has been running through treacle over the past few years. Its share price opened the week (18th March) at 0.985p, up 3.7% where it was the year before. Over 52-weeks the share price ranged between 0.23p and 1.25p, but since the start of the year, Powerhouse’s shares have advanced 165%.  [Since we wrote this article the share price has risen even further, topping the AIM top risers table more than once.]

So, what has happened to justify the recent ramp-up in Powerhouse Energy? Well at the start of the week, the plastics-to-hydrogen company had some positive news as it was appointed (through its wholly owned subsidiary Engsolve) to build and install its first commercial production train for Bridgend-based TrimTabs.

Nanotubes and battery technology

TrimTabs produces carbon nanotubes from solvents and plastic waste, which are used for carrying electric current. According to TrimTabs, carbon nanotubes are 1,000-times better at carrying electric current than traditional copper wiring, are lighter, non-flammable and up to 10- to 100-times better at dealing with high heat than metal alternatives. Moreover, carbon nanotubes are good for the environment, locking-down carbon, preventing it escaping into the atmosphere and contributing to global warming. Carbon nanotubes can be used in batteries and fuel cells, concrete fabrication, EMI shielding, semiconductors and power transmission.

Powerhouse Energy won the tender from TrimTabs as the Welsh company believed that Powerhouse’s process could be best scaled-up from a pilot plant to a industrial-scale operation. The plant that the Yorkshire company is set to build will from the jump be at near-commercial scale production, and has a low power draw of 15kW, but will produce enough nanotubes to build hundreds of batteries.

Engsolve’s contract win comes on the back of other positive developments including earlier this month Powerhouse signing a joint venture with Hydrogen Utopia International [LON:HUI] to develop a non-recyclable-plastics-to-hydrogen plant in Longford, Ireland which will benefit from the EU ‘Just Transition Fund’ in the Republic which is due to receive EUR169m in EU funding for the region.

The company has also been looking at opportunity beyond Europe, signing a five-year agreement to provide Front-End Engineering Design (FEED) through Engsolve to Australia’s National Hydrogen Ltd for multiple hydrogen-based projects across Australia, Italy, Switzerland, and Hong Kong. The Australian deal will not commit Powerhouse to providing any funding for the proposed projects, but instead will operate on a licence-fee and royalty arrangement for Powerhouse’s technology.

Powerhouse Energy diversifying group revenues

Paul Emmitt, Powerhouse Energy’s chief executive officer said in a recent statement: “We have a number of exciting projects which we are looking to develop and have bought Engsolve into the fold which will diversify our revenues and give us access to a number of new potential partners.  Corporately, we have a newly structured and focussed board with a strategy to drive forward the company’s growth to ensure that as a priority we deliver value to our shareholders. We as a board are extremely optimistic for 2024, and fully committed to ensuring it is as successful a year as is possible.”

Although there are positive signs of growth, Powerhouse is still not a money-making operation. In its last set of results, for the half-year to end-June, the WTE company was still reporting zero revenues, no profit – down from GBP79,900 in 1H22 – had depleted its cash by 35% to GBP4.9m and undertaken a GBP1m placing in August. However, the double zeroes were a result of Powerhouse acquiring Engsolve and Protos Waste.

The company has undergone some serious reorganisation at a board and operational level. The shoots of progress are starting to emerge with the coming of Spring, but it’s still too early to see if the changes made will have a significant material impact on Powerhouse Energy this year. However, the direction of travel is encouraging.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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