Xeros 's (XSG) washing machines use tiny polymer beads that not only clean fabrics, but also consume 80 per cent less water and half the energy of conventional laundry systems. Given the early stage of the Aim-traded group's development and the investment required to achieve its goals, investors shouldn't be shocked that it posted an adjusted cash loss of £5.4m in the five months to December 2015.
A more pressing concern was how the £40m raised in November had boosted the commercialisation of Xeros's polymer bead cleaning system. A sharp jump in the share price on results day suggested investors were ecstatic with the progress made installing machines across hotels, dry cleaners and spas in North America.
Boss Mark Nichols claims 10,000 laundry systems are installed each year in the sector, and is confident that Xeros will be placing one every working hour by 2020. That's markedly more than its current one-per-day rate, and substantially ahead of the one-per-week rate of 14 months ago. Should the early development of smaller washing machines designed for laundromats come good, prospects look even better.
Progress was also made developing technology to the water-thirsty leather industry. Trials in a leading European tannery for this product, which was made in conjunction with German chemical giant Lanxess (Ger:LXSX), are expected to complete by mid-year.
| XEROS TECHNOLOGY (XSG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 220p | MARKET VALUE: | £187m | |
| TOUCH: | 211-225p | 12-MONTH HIGH: | 370p | LOW: 147p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 63p | NET CASH: | £49.5m | |
| Five months to 31 Dec† | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 90 | -3.8 | -5.9 | nil |
| 2015 | 734 | -5.6 | -8.4 | nil |
| % change | +716 | - | - | - |
†Xeros has changed its financial year-end from 31 July to 31 December | ||||
