March 6 (Renewables Now) - Carnegie Clean Energy Ltd (ASX:CCE) on Tuesday reported a loss of AUD 45 million (USD 32m/EUR 28m) for the first half of fiscal 2018/19 and warned that it needs to secure fresh funds and renegotiate debt in order to be able to proceed as a going concern.
The Australian wave power company said in its financial report that the net loss after tax for the period July-December 2018 includes impairment charges of AUD 39.2 million versus none in the same period of 2017, when the company recorded an after-tax loss of AUD 9.1 million. Revenue went down to AUD 2.8 million from AUD 3.3 million. The gross loss was reduced to about AUD 392,400 from AUD 1.12 million.
The developer of the CETO wave energy device said that its solar and microgrid business, Energy Made Clean (EMC), has recorded a AUD-6-million loss from operations during the period. The particular business was supposed to be sold to Sydney-based investment house Tag Pacific Ltd (ASX:TAG) so it could merge it with its MPower unit, but that deal was terminated at the end of November 2018.
Carnegie said in the report that after the cancellation of the EMC deal, the company has been approached by several other interested parties. It is now exploring options for the EMC business including its sale. The suitors are conducting due diligence inquiries through a data room provided by Carnegie.
Because of the net loss and the fact that current liabilities exceeded its current assets by AUD 1.08 million as at December 31, 2018, Carnegie recognises “a material uncertainty that may cast significant doubt upon the group’s ability to continue as a going concern.” The company noted that it has initiated planning to raise capital in the short term via a new equity issue. At the same time, it is looking to renegotiate the conversion terms relating to certain convertible notes maturing on January 11, 2020. Preliminary high-level discussions have been held.
The company also explained that it lodged its financial report late due to the additional work needed in the impairment of assets and some other changes. Because of the delay, trading in its shares was suspended.
Carnegie said in a bourse filing today that the suspension will remain, pending an announcement regarding a strategic review of its operations and a fundraising initiative. The company expects the suspension to last until the start of trading on March 13, 2019.
(AUD 1.0 = USD 0.703/EUR 0.622)