AXEON, the green battery pack company, charged higher yesterday despite warning that sales for delivery vehicles were slower than expected and that its first-half losses would widen.
The Dundee-based manufacturer derives most of its turnover from batteries for power tools, but its development of lithium battery packs for low-emission urban vehicles are watched most keenly by investors.
Yesterday the company warned that first-h
alf losses in the six months to 30 June were likely to be greater than the £522,000 for the same period last year – owing to an increase in investment and a build up in stock levels, with production in the automotive sector growing more slowly than expected.
But Axeon, headed by chief executive Hamish Grant, said it was making progress in penetrating the automotive market, providing 12 prototypes packs for nine different customers. Recent orders include prototypes for hybrid powered buses in America and heavy delivery vehicles in Europe.
In May, Axeon announced a £17.4 million contract for hybrid powered vehicles with Glasgow-based Allied Vehicles, for which it expects to begin delivery in September. Deliveries to urban delivery vehicle maker Modec continue to be on schedule.
Grant said customers continue to predict double-digit growth in demand for battery products, adding that economic conditions continued to work in favour of its automotive sector.
Grant also maintained that Axeon was on track to meet the market's expectations for the full year.
"The general macroeconomic changes of higher fuel prices and increasing policy action on reducing automotive emissions is accelerating interest in our lithium-ion EV and HEV battery technology," he said.
"The increase in the number of customers prototyping vehicles using our battery technology augurs well for the future."
Total turnover for the year is expected to be around £74m, with around £60m coming from sales of battery packs for power tools – sales it acquired through its purchase of Swiss company Ristma for £7.4m a year ago.
Axeon also announced that in the last month it has received orders of 2m (£1.6m) for its mobility products, for products ranging from coffee trolleys to power assisted bicycles.
Arbuthnot Securities analyst David Cunningham said that the company appeared on track to meet his guidance for a maiden pre-tax profit of £1.2m for the full year.
Shares in Axeon, listed on the Aim, rose 3.5p to 51.5p.
The full article contains 404 words and appears in The Scotsman newspaper.
