Equipmake [AQSE:EQIP], the Norfolk-based manufacturer of electrification products for EVs celebrates its second anniversary on the Aquis stock exchange today (29th July).
The company has developed an array of products that provides the energy powering drivetrains (the mechanical parts that collaborate with the engine to move the wheels and various parts of a vehicle to drive it into motion) of EVs. What it does is core to the transition theme of the switch from fossil fuels to zero-emission electric vehicles.
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Equipmake operates in the automotive and aerospace sectors but has especial expertise in developing electrification products for buses, where it has won contracts to retrofit existing bus fleets and provide technology to new buses being manufactured.
Equipmake founded as a spin-off from Formula One
Although Equipmake has only been a public company for two years, the company has been operating for nearly 30-years. It was founded in 1997 as a side-hustle to Ian Foley’s motorsport engineering work, to champion his vision for electric vehicles. Within a decade Foley had switched from developing high-performance motorsports components to the design of affordable high-performance electric motors, but maintaining links with F1 with Williams as a key client.
In the next decade Equipmake had honed its technology and initiated the Cost Effective Electric Bus EV Drivetrain project in partnership with Brazil’s Agrale, an engineering company established in 1962 to design agricultural machinery. By 2020, Equipmake was undergoing a rapid period of growth, growing its workforce from fifteen to 55. The following year, Equipmake unveiled Jewel E, the first all-electric double decker bus featuring Equipmake’s zero emission drivetrain, including a 548kWh battery with up to a 300-mile range in partnership with Beulas & Agrale.
The company published a trading update to end-May earlier this month, highlighting the appointment of an expanded management team and its successful GBP4.1m fundraise in February, which saw new shareholders joining the company. The focus in the last year has been tooling-up its operations to deliver greater volumes to its key clients – original equipment manufacturers (OEMs) and Tier One suppliers, who directly supply OEMs.
Buses led the way, making the largest contribution to revenues, with Equipmake not only supplying drivetrain equipment, but installing it. They won a contract with private equity-owned Big Bus Tours to repower twenty buses, and followed this up with a GBP2m contract with Golden Tours to retrofit its electric drivetrain to fleet vehicles. The bus repowering business contributed GBP3.9m to revenues in the year to end of May – a big jump from GBP900,000 for the same period last year.
Equipmake making in-roads into aerospace and defence
The company also made in-roads into the aerospace and defence industry, with a request to provide a prototype of an electric airstrip de-icing vehicle originating from a US defence contractor in September. The prototype was successful, and the defence company ordered two drivetrain units for two more vehicles. Equipmake also secured a development contract with Swiss aviation propulsion company H55 to design the powertrain for electric aircraft engines.
In light of the slew of new business, Equipmake commissioned a new 50,000 square foot factory in 1Q24, which will allow it to expand its product manufacture and assembly. Revenue for the year to the end of May came in at GBP8.1m, up from GBP5.1m the year previously; of that GBP7.3m was exclusive of grants. The company also improved its profit margins this year. Equipmake had GBP2.5m in the bank at the end of May with no debt, apart from items held under finance leases.
Foley said: “We are very pleased to have delivered a substantial increase in revenue in the year, a 60% increase on the previous year, highlighting both the increased awareness of, and demands for, our pioneering electrification technologies.”
The outlook for Equipmake is bright
Equipmake has developed strong relationships with OEMs and is starting to diversify its product line away from buses – which has been a significant contributor to revenues and seen incredible growth in the last year – into defence and aerospace and aviation and industrial machinery through a relationship with Perkins Engine Company, a subsidiary of Caterpillar NYSE:CAT. Equipmake should have a busy year, and this should see the share price appreciate.
Equipmake, which has a market cap of close to GBP50m, closed last week at 4.75p down 50% from a year ago. However, the share price should start to turn around in the next twelve months.