Nanoco (NANO), a UK-based supplier of heavy-metal free quantum dots which improve colour performance in LCD TVs, continues to make good progress towards commercialising its technology.
The bulk of Nanoco's income is currently generated by joint development agreements (JDAs), where partners pledge to share costs to get the quantum technology to market. Nanoco does not reveal the names of its JDA partners in the LCD TV space, but Mr Edelman says big-name Asian suppliers are now on board. "We have significantly de-risked the business," he says. In the solar market, where the company also plays, Nanoco extended its JDA with Tokyo Electron.
The next phase of the company's growth is generating volume sales, which in turn will bring in licensing and royalty income. Chief executive Michael Edelman believes commercial revenue is still two years away, but anticipating greater demand than previously thought, Nanoco has doubled its annual capacity target to 400kg of quantum dots. Mr Edelman says the expanded manufacturing facilities will be ready in 18 months' time.
Importantly, Nanoco is well funded to withstand pre-tax losses of £4.2m and £3.5m over the next two financial years, as predicted by broker Canaccord Genuity. In fact, reflecting improved JDA flow, net cash actually rose by £1m in the second half to end the financial year at £15.2m.
NANOCO (NANO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 61p | MARKET VALUE: | £131m | |
| TOUCH: | 60-62p | 12-MONTH HIGH: | 80p | LOW: 37.4p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 8p | NET CASH: | £15.2m | |
| Year to 31 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 1.08 | -0.70 | -0.37 | nil |
| 2009 | 1.99 | -0.78 | -0.31 | nil |
| 2010 | 2.94 | -1.37 | -0.60 | nil |
| 2011 | 2.64 | -3.22 | -1.30 | nil |
| 2012 | 2.95 | -4.35 | -1.80 | nil |
| % change | +12 | - | - | - |
