Ilika plc (LON:IKA) Chief Executive Officer Grame Purdy caught up with DirectorsTalk to discuss the company’s progress with its Stereax and Goliath solid-state battery businesses, including product-related revenue, M300 deliveries, the electric vehicle market and growing defence-sector interest.
Q1: Now, Ilika has made great progress over the last 12 months, both with its Stereax and Goliath businesses. If you had to choose one highlight from each business, what would it be?
A1: Well, so many to choose from but first of all, on Stereax, let’s say that the commencement of recognition of product-related revenue through the sales of our Stereax electrodes to Cirtec is a really important milestone. On the Goliath side, probably the release and reception of our Goliath 10Ah prototype cells was a really important milestone.
Q2: Stereax has become revenue-generating. How is that possible, given that Stereax is still being integrated into approved devices?
A2: Well, our customer is actually Cirtec rather than the end users of the batteries. So we are selling electrode materials, actually specifically our cathode, which is the positive electrode for making the batteries.
In addition, when we get to the point of releasing batteries to customers later this financial year, we will be recognising revenue from the sale of those prototype batteries as they go through the approval process.
Q3: Are you still expecting to have M300 batteries to customers this financial year?
A3: Yes, that’s right. So, we actually have a series of batches of Stereax batteries in flight at the moment, they are being processed. Actually, the electrodes that we sold to Cirtec at the end of the last financial year are being microfabricated into M300 batteries at the moment. They’ll be released once we’ve validated them and quality-checked them.
Q4: Just going back to Goliath, we’re hearing a lot of opposing views on how the EV market is developing. What do we know for sure? What are the facts?
A4: Sometimes, EVs, the whole subject becomes quite politicised, doesn’t it? The reality is that there are different incentives around the world, depending on the jurisdiction.
I’d say in the US, there have been particular headwinds for EVs because of the removal of incentives for buying EVs and that was a political decision that was made there.
Here in Europe, and also in many parts of Asia, including China, we saw very strong, sustained growth of demand for EVs. Last year, Europe, for instance, saw a 27% increase in new EV sales and here in the UK, it’s a similar number. Also here in the UK, the Office for Budget Responsibility is still expecting that the majority of vehicles on the road, so not just new car registrations, but the majority of new vehicles and older vehicles on the road, will be EVs by 2035.
Q5: So, is the 10Ah Goliath product likely to be licensed or manufactured by Ilika?
A5: Well, the 10Ah product is actually really a milestone, a prototype at the moment. In our recent placing, we raised some funds to allow the productisation, if you like, of that prototype. We did that because we’re seeing quite a lot of non-EV interest, in particular from the defence sector and other commercial sectors, for that 10Ah cell as a sovereign-manufactured product.
So, we’re pursuing that at the moment and that’ll be part of our news flow going forward.
Q6: Theres’s a lot of commercial interest. Which prospects are you most excited about?
A6: I would say probably within the defence sector, there is a lot of spending that’s been earmarked by various European governments, not just here in the UK. People are interested in the sovereign supply chain because they don’t want to become dependent on the supply of a component that might end up being from a jurisdiction that’s not necessarily always politically aligned with how we are in Europe.
Therefore, there’s a lot of interest in applications and they are quite broad across uncrewed vessels, actually drones for airborne on land and sea, and also for man-portable and vehicle-portable battery packs. A lot of modern defence equipment is electric, and it needs to be powered somehow.
So, there’s a lot of focus on the battery supply chain right now.
