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#ASX Announcements
Added 2 weeks ago

29 April 2021

Q1 2021 Highlights

  • New orders $13.3M:+11% vs Q4 2020 and+6% versus Q1 2020
  • SPS new orders $7.5M, +36% vs Q4 2020 including $5.0M from China bookings
  • Revenue $18.2M with SPS $3.7M +28% versus Q1 2020, and China +38% Q12020,showing strong China momentum
  • $191M contracted backlog of which SPS backlog is $23M, showing strong SPS momentum
  • Continued improvement in operating efficiency; opex down 10% from Q42020
  • Operating cash outflow of $21M – of which $13M as scheduled for Ivory Coast project expenses, after receiving $60M in payments for this project in Q4 2020
  • Cash balance of $14.9M plus $27.4M in short? and long?term liquid investments provides adequate operating reserves
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#ASX Announcements
Added a month ago

Melbourne, New York 1 April 2021

Fluence Announces Key Orders In China and SE Asia

  • First Multi-Unit Orders From Two National State-Owned Enterprises in China
  • First Sales For Wastewater Reuse In China – Key Part of China’s New 5 Year Plan
  • First Multi-Unit NIROBOX Sale in Taiwan
  • Orders total US$4.6 million with follow-on business anticipated

Fluence Secures First Volume Order From Three Gorges

Fluence Corporation Limited (ASX: FLC) is pleased to announce that it has been awarded its first volume contract for the Yangtze River Great Protection Program managed by China Three Gorges Group Corporation (“Three Gorges”). The orders with Three Gorges are worth an aggregate of US$2.2 million and involve a total of 29 Aspiral MABR units. Fluence will work with its existing volume partner, Aerospace Kaitian Environmental Protection Technology Co., Ltd.(“Kaitian”), as well as Yangtze River Ecological Environmental Protection Group Co., Ltd., a subsidiary of Three Gorges, to implement treatment systems in 14 towns and rural townships in Ningyuan and Dao counties, Hunan province. Three Gorges’ Yangtze River protection program impacts 11 provinces in China and includes rural wastewater treatment and upgrades to centralized wastewater treatment plants.

China Rail Order – First In China For Wastewater Reuse

Fluence is also pleased to announce that it has been awarded an additional contract by Beijing China Railway Science New Technology Co. Ltd., wholly owned by China Academy of Railway Sciences Cooperation Limited (“China Rail”). The contract is worth US$28K for two (2) Aspiral Micro units to treat and reuse wastewater at sites including Beijing. This is the first wastewater reuse project for Fluence in China. Wastewater reuse is a key part of the current Five Year Plan.1 Aspiral Micro was chosen on account of its ability to treat wastewater to the high quality needed for reuse for irrigation, operate remotely, and can be deployed and commissioned rapidly.

Fluence Secures First Multi-Unit NIROBOXTM Order in Taiwan

Finally, Fluence is pleased to announce that it has been awarded a US$2.4 million contract to supply three (3) NIROBOXTM units to drought-stricken Taiwan. Fluence was able to leverage a proven product and quick turnaround time to secure the order. Commissioning is expected in May 2021. The units will be installed in Taichung and will convert seawater into enough fresh water to meet the needs of up to 30,000 people in central Taiwan. Fluence partner ADE Corporation facilitated the order from the Water Resources Agency, which is part of the Ministry of Economic Affairs of Taiwan.

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#ASX Announcements
Last edited 3 months ago

26 February 2021

Appendix 4E - 31 December2020

  • Revenue for ordinary activities Up 62.3% to 97,139,000 USD
  • Loss after tax attributable to members Down 76.3% to (7,440,000 USD)
  • Net loss after tax (from ordinary activities) for the period attributable to owners of Fluence Corporation Limited Down 45.9% to (17,016,000 USD)

Net tangible assets (per share) $0.04 (31 December2020) from $0.05 (31 December2019)

...

Cash and cash equivalentsat 31 December2020 amounted to US$31million (2019:US$22million).

In addition, other financial assets at 31 December 2020 included short term deposits of US$15million (2019:US$5million). As at 31 December 2020, the Group had borrowings of US$22million (2019:US$3million). Following the 2020 results, Fluence plans to continue its current growth strategy. Smart Solutions revenue in 2019 was US$26million. In 2020 this grew to US$32million and is forecast to reach US$35- US$50million in 2021.

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#ASX Announcements
Added 4 months ago

Q4 2020 Highlights

  • Q4 2020 revenues of $23.5M, up 51% from Q3 & flat to Q4 2019
  • Q4 2020 operating expenses $8.4M, down 34% from Q4 2019
  • Positive Q4 operating cashflow of $33.4M
  • Ivory Coast payments of approx. $60M received on schedule
  • Cash balance $31.0 Mat 31 December 2020 up from $21.9 Mat prior year end
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#ASX Announcements
Added 5 months ago

Ivory-Coast-Reaches-Key-Milestone,-Project-Now-Cash-Positive

Some good news ...still worries over China 

DISC: I have a small holding

View Attachment

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#New MD/CEO & Game Plan
Last edited 6 months ago

16-Nov-2020:  Fluence Strategic Repositioning, Change in CEO

Fluence repositions strategy to focus on MABR and Smart Products Solutions, changes MD & CEO, and reaffirms guidance Summary

  • Strategic repositioning is designed to focus primarily on three (3) key segments:
    • MABR wastewater solutions in China and Southeast Asia;
    • NIROBOXTM desalination solutions in the Middle East and Southeast Asia; and
    • the Ivory Coast water treatment project
  • Continued development of strategic channel distribution partners and further improvement of operational efficiencies
  • Effective immediately, Richard Irving, Chairman, will also assume the role of CEO, replacing Henry Charrabé
  • 2020 guidance reaffirmed

Fluence Corporation Limited (ASX:FLC) has become a leader in the decentralized water, wastewater and reuse treatment markets through Smart Products Solutions, including MABR-based Aspiral™ and SUBRE as well as our NIROBOX™ technology. To further leverage and build on this success, Fluence is repositioning its global business to focus on these products in the most attractive market segments with the goal of achieving more rapid, consistent and profitable growth.

--- click on the link above for the full announcement ---

[I do NOT hold FLC shares.]

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#New Work
Added 8 months ago
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#FY20 H1 Results
Last edited 9 months ago

31-Aug-2020:  After Market Close:  Appendix 4D and Half Year Accounts   and   Half Yearly Report and Accounts   plus   H1 2020 Fluence Corporation Results Deck

The Fluence (FLC) Half Year (1st half of FY20) results have not yet been fully audited, so they're taking advantage of the recently announced ASIC relief titled “ASIC Corporations (Extended Reporting and Lodgement Deadlines—Listed Entities) Instrument 2020/451” dated 15 May 2020 and the corresponding ASX Class Waiver issued on 16 June 2020 titled “Extended Reporting and Lodgement Deadlines” to lodge its Half Year Accounts subject to audit review, and defer lodgement of the audit reviewed Half Year Accounts until no later than 30 September 2020.  I notice that ISX (iSignThis) did the same thing last week.

Fluence's H1 2020 unaudited numbers were:

  • Revenue from ordinary activities: Up 141.3% to US$57,373,000 (US$57.373m)
  • Income from ordinary activities after tax attributable to members: Up 109.9% to US$1,736,000 (US$1.736m)
  • Net income after tax (from ordinary activities) for the period attributable to owners of Fluence Corporation Limited: Up 111.6% to US$2,041,000 (US$2.041m)
  • Dividends (distributions): None declared, same as pcp
  • Net tangible asset per security as at 30 June 2020: $0.06 (6c) (December 2019: $0.05)

Fluence by the Numbers (from page 3 of the Results Deck):

  • 7,000+ Reference sites
  • 70+ Countries
  • 180+ MABR Installations
  • 110+ NIROBOXTM Desalination Systems
  • 350+ Employees
  • 150+ Engineers

H1 2020 Key Highlights (from page 4 of the Results Deck):

  • Keeping employees, partners and customers safe – adjusting to COVID-19 conditions
  • Operating revenue up 143% to $57.4m*
  • SG&A cost continued to decline, down 27% on H1 2019
  • $6.2m EBITDA
  • Recurring revenue up 18% to $3.9m from BOOT and O&M contracts
  • Smart Products Solution (SPS) revenue up 89% vs. H1 2019 to $10.6m
  • Achieved financial close of the Ivory Coast Project
  • Secured debt facility of $20m from Upwell Water
  • Positive NPAT of $1.7m
  • Cash flow positive in Q2 2020 (June Qtr), cash balance of $20.2m as at June 30, 2020
  • Backlog of $234m as at June 30, 2020

* = All numbers in presentation are USD (US$) if not otherwise stated.

--- click on the links above for more ---

[I'm not keen to hold China-facing smaller companies at this point in time, so FLC and PET (who reported last week - on the 26th) are two companies I am avoiding at the moment.]

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#Bear Case
Last edited 10 months ago

08-July-2020:  I can see why FLC might look like rediculously good value at around 20 cents per share, but their chart is truly horrible, and they are very exposed to China - who may well still be trying to punish Australia for daring to ask for an inquiry into the origins and early response to COVID-19. I have been out of FLC for a long time now, and haven't been following them very much. I also removed them from my Strawman.com scorecard some time ago because I saw little reason why their SE SP trajectory was going to suddenly change and head north again. I removed PET recently for much the same reasons. A small Australian company with too much invested in China at the wrong time.

Other issues specific to FLC, in my opinion, include:

  1. Most of the board and management have exposure via options rather than direct shares. Only their Chairman has a decent holding - 37.265 million shares. Their CEO/MD, Henry Charrabe, has 12.35 million options, but no shares. Two NEDs (non-executive directors) have half a million shares (currently worth only around $100K) and three directors (half of their 6-member board) hold no shares (just options), which includes Mr Charrabe.
  2. The global adoption of their water-purification tech has been less than impressive.
  3. There was a lot of hype in prior years, and it seems to me that the hype was entirely unjustified.
  4. They are a small microcap company with a market cap of only around $130m, and they keep raising more money - so are regularly asking their shareholders to tip in more and more money, as their profitability timeline keeps getting pushed out further and further. They had less than $17m of cash at March 31, 2020.
  5. Last month they said, "Despite the delay in receiving the payments from the Ivory Coast Project, the Company expects operating cashflow for Q2 2020 to converge towards cash-flow breakeven. The expected improvement in operating cash flow in Q2 2020 compares to a US$7.9 million operating cash OUTFLOW in Q1 2020, and reflects the ongoing focus on lowering overhead costs and strong cash collections." More positive spin, but little actual real progress, in my opinion.
  6. I jumped on them in prior years as a momentum play, and, unfortunately, the momentum is all going the wrong way now, so I'm not interested.
  7. I don't mind these sort of beaten-down stories if I trust the management based on their prior track record, and I really like the business model, and think they've got strong tailwinds both as an industry and as a business within that industry, but I'm not sure that those conditions exist here.

Of course, 2 days later (on Friday 10th July, 2020) - they released this announcement:  Fluence Achieves Positive Quarterly Cashflow.  And rose +17.5%.

I think a number of my points do however remain valid.  On the other hand, this could be a positive inflection point for FLC.  Time will tell.

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#Personal Opinion
stale
Last edited 11 months ago

#Water Consumption is forecast to double by 2050.

#The production of biofuels has also increased sharply in recent years, with significant impact on water demand. Between 1,000 and 4,000 litres of water are needed to produce a single litre of biofuel.

#Almost 80% of diseases in so called "developing" countries are associated with water, causing some three million early deaths. For example, 5,000 children die every day from diarrhoea, or one every 17 seconds. Demand for freshwater is increasing by 64 billion cubic meters a year (1 cubic meter = 1,000 litres).

 

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#Industry/competitors
stale
Added 11 months ago

Fluence operates in the small to mid range of water treatment, desalination project size.... They work globally from a minesite in Chili, a chicken factory in Italy, a resort in the Philipines, the worlds longest highway in China....and on and on.

This market is saturated with huge multinationals that are chemical companies like ECOLAB, Solenis, filtration companies such as Pentair, some Chinese giants.

On the small cap space I also own Scidev Ltd (ASX:SDV) which imports chemicals that coagulate all the crap in the water that you can then filter out with standard processes.... SDV have a big market in coal mines and recently building sites.

None are as compelling as Fluence, which is weird as I am down on FLC and up on SDV even though I'm more bullish on FLC, as their product offering is diverse, scalable, environmentally friendly, energy efficient, and are fast approaching cashflow positive.

Some countries import water to survive...eg Turkmenistan imports 97% of its use!!!  Ok that is an extreme example..  Zimbabwe imports 39%.  Not only poor countries.. Switzerland imported 24% of its use  ****All these stats are in 2017****   

By reusing wastewater, having decentralised desalination plants in an energy efficient, environmentaly friendly, cost effective solution I believe and hope that Fluence and the communities it serves can prosper.

 

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#Financials
stale
Added one year ago

Business Update for Quarter Ended 31 December 2019 (Q4 2019)

  • Q4 2019 gross bookings of US$25.4 million, with total backlog at 31 December 2019 at US$265.0 million
  • Strong quarterly sales were underpinned by FY 2019 Smart Product s Solutions revenue of US $26.5 million, exceeding the revised guidance
  • Two significant follow-on orders in China, and US$5.0 million Smart Products Solution in Argentina
  • Increased recurring revenue backlog by signing operation and maintenance agreement in Caribbean
  • Continued reduction in overhead costs by at least US $5.0 million annually or 12% YoY (unaudited)
  • Successfully raised A$38.3 million gross proceeds via a private placement and SPP
  • Achieved Financial Close (on 7 January 2020) for the Ivory Coast water treatment plant project , which underpins expectation of sustainable EBITDA profitability in FY 2020
  • Strongly positioned for growth in FY 2020, with FY 2020 guidance for Smart Products Solutions revenue of at least US $32.0 million (up 20 % YoY ), recurring revenue of US $9.0 million (up 30% YoY) and sustained EBITDA profitability
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