Getech Group Announces Final Results for the 12 Months Ended 31 December 2021

Source: www.gulfoilandgas.com 5/19/2022, Location: Europe

The Getech Group announces its Final Results for the 12 months ended 31 December 2021.

Highlights
A transformational year, investing for future growth.

Key financial highlights
· FY2021 revenue rose c. 20% to £4.3m (2020: £3.6m);
· Orderbook grew by 25% to £3.3m at 31 December 2021 (31 December 2020: £2.7m);
· Annualised recurring revenue* stable at £2.1m at 31 December 2021 (31 December 2020: £2.1m);
· Cost base increased to £6.5m, through equity funded low carbon investment (2020: £5.2m);
· Loss for the year of £1.6m, adjusted for exceptional items** (2020: £1.5m loss);
· Reported loss for the year of £1.9m (2020: £1.6m loss); and
· Strong net cash*** position of £5.1m at 31 December 2021 (31 December 2020: £1.4m).

Key corporate and operational highlights
· Repositioned strategy with new 'locate-develop-operate' business model designed to accelerate a secure and sustainable path to decarbonisation;
· Expanded the application of geoscience data and software products into essential tools enabling the energy transition and enhancing the security of energy supply;
· Acquired a green hydrogen developer, and secured the first two development projects;
· Developed key strategic partnerships with Shoreham Port, SGN Commercial Services (SGN), Eversholt Rail and the Highland Council; and
· Continued to invest in new talent and skills.

Strong outlook
· Focused on accelerating the global energy transition and ensuring a secure supply of energy; all whilst delivering transformative shareholder value through:
o expanding our robust pipeline of products and services for the energy transition;
o ambition to establish at least 500MW of new geoenergy and green hydrogen assets by 2030 by:
§ replicating and scaling up our green hydrogen asset development model, both in UK and internationally;
§ building strategic partnerships to secure and develop geothermal energy projects; and
§ pursuing energy co-location opportunities in the critical minerals sector.

Getech CEO, Dr Jonathan Copus commented:
"2021 was a transformational year for Getech, during which we invested to diversify the application of our world-leading petroleum products into new geoenergy and green hydrogen growth sectors. We also established a new 'locate-develop-operate' business model.

We delivered this against a turbulent macroeconomic backdrop that continues to highlight the urgent need for the world to significantly increase energy investment. To ensure energy security and the transition to a low carbon future, governments have materially increased their clean energy targets and are fast-tracking policies to accelerate the pace of energy system investment.

In this environment, demand for Getech's products increased - revenue grew 20% and our orderbook expanded by 25%. We also acquired a hydrogen development company, H2 Green, and signed a range of valuable strategic partnerships, securing exclusivity over our first two hydrogen development projects.

Building on this momentum, our ambition is to establish a portfolio of at least 500MW of new geoenergy and green hydrogen assets by 2030. These could save c.2 million tonnes of CO2 production annually, and would deliver transformational value to our shareholders.

Getech moved into 2022 with confidence and we look forward to building our position in a primary energy market that is undergoing unprecedented change and growth." Letter from Chair and CEO Getech - a geoenergy and green hydrogen company

FY2021 was a year of strategic advancement and robust delivery for Getech. With a diversification plan focused on green hydrogen, geothermal, critical minerals and energy/carbon storage, our shareholders supported us in a £6.25 million capital raise to position Getech at the vanguard of the energy transition.

Through this investment, we are repurposing our world-leading geoscience data and unique geospatial software products, and successfully extending their application to geoenergy sectors beyond petroleum, and green hydrogen. During the year, we have added new content, modules and workflows to our platforms, solutions and software and have grown our customer base in the energy transition sectors. Our mission is now firmly set on delivering an accelerated, secure and sustainable path to decarbonisation through the application of our products, technologies, and skills.

As we strengthen our status as a trusted partner in the energy transition, this in turn enables us to establish new revenue-generative relationships that we can expand into strategic partnerships and build our own portfolio of scalable repeatable low carbon projects. Our locate-develop-operate business model has been designed to maximise the value of our unique offering and to deliver transformational growth in shareholder value.

In FY2021, we purchased H2 Green, a company developing green hydrogen networks of production, storage, and distribution facilities. Since this acquisition, we have secured exclusive development rights on two green hydrogen hubs - at Shoreham Port and in Inverness.

We have also invested in new talent: adding senior executives with significant engineering, economics, project delivery and business development experience; and Board skills in business scale up, ESG and low carbon asset management. We have also enhanced our marketing and communication resources.

Through the recruitment of Max Brouwers - who joined Getech as Chief Business Development Officer, having previously led the Energy Transition at Shell Global Exploration - we have established a physical presence in Europe, which we are growing further in 2022.

Our progress during the year and into 2022 is notable, as evidenced by growth in revenue, an expanding orderbook, and new asset agreements. We anticipate further upward momentum as the pace to net zero accelerates.

Business environment
The need to substantially increase energy investment on a global scale has never been clearer or more urgent. Governments across the world are responding with new strategy statements, to deliver affordable, secure, and sustainable low carbon energy. War in Ukraine has heightened this, and in 2022 energy investment could total as much as 13% of global GDP - the highest level on record.

This action is underlain by governments' broader commitments to address climate change. The EU has pledged to be climate-neutral by 2050, with each member state required to develop a national long-term strategy on how they plan to achieve this.

Similar trends can be mapped around the world, with decision-makers defining the budgets, incentives and regulatory structures that are needed to enable the required investments to proceed within the aspired timetables to deliver on their energy security and decarbonisation goals. The energy transition presents governments, regional authorities, cities, and companies with a complex web of decision making, which Getech can help unlock using its data, knowledge and analytics.

There is a growing momentum behind the view that low-carbon hydrogen will play a significant role in the decarbonisation of the energy system, and as a result, global projections for growth in hydrogen capacity have been revised upwards in each of the last three years.

This momentum is backed by governments' policies, incentives and funding support. REPowerEU has quadrupled the EU's green hydrogen supply target to 75GW by 2030 - half of which will be supplied by imported hydrogen. The EU Commission has also pledged to fast-track market reforms to promote development of hydrogen projects and infrastructure such as storage.

In the UK, the government has announced various funding programmes and incentives for low-carbon hydrogen, including the £240 million Net Zero Hydrogen Fund, a £26 million Industrial Hydrogen Accelerator innovation programme, and the launch of the world's first national subsidy for clean hydrogen production. This is aimed at advancing the UK government's ambition to have up to 2GW of low-carbon hydrogen production capacity by 2025 and up to 10GW installed by 2030 - at least half of which is to be from green hydrogen.

By using our geospatial and economic analytics to identify optimal sites, Getech is ideally positioned to accelerate the adoption of green hydrogen, both in UK and internationally.

Our ambition is to establish at least 500MW of new geoenergy and green hydrogen assets by 2030.

Moving from pledge to action on our sustainability objectives
In 2021, Getech joined the United Nations' Race to Zero campaign, pledging to become carbon neutral by 2030. To support the delivery of this, we established an ESG committee and appointed an ESG expert to our non-executive directors' team.

As we build an ESG-centric business, we are establishing metrics and KPIs that set a clear and auditable roadmap to assess Getech's 2030 net zero delivery. We look forward to implementing this enhanced sustainability framework during FY2022 and reporting on progress in the next annual report.

Outlook
Getech is an established, cash-generative, and diversified growth-focused business that is well-funded to deliver on our strategy. In 2022, we plan to continue growing our share of the global energy transition market.

In our foundation products and services business, this means expanding the low carbon application of our geoscience data and geospatial software products, through new content, new geoenergy capabilities and delivering innovations around other key energy transition themes such as CCS.

In asset development, we are progressing our projects in Shoreham Port and across the Scottish Highlands. Together these projects represent c. 50 MW of full capacity - equivalent to 10% of our 500 MW ambition.

The tangible progress we are making in the decarbonisation of commercial transport places us firmly on the hydrogen map. This is widening our engagement to include larger volume off-takers - such as industrial players seeking clean hydrogen to decarbonise their operations and organisations outside of the UK looking to import green hydrogen. In the coming months, we will progress these discussions as we work to expand our hydrogen portfolio.

We are also evaluating asset participation opportunities in geothermal energy and energy co-location projects in the critical minerals sector. As further projects are secured, we will continue to report on our progress towards the 500MW ambition.

On behalf of the board, we would like to thank our shareholders for their support and our employees for their continued commitment during this exciting and transformative period for the Group.

Being at the heart of the high growth geoenergy and green hydrogen sectors, we have moved into 2022 with confidence and believe we are ideally positioned to deliver substantial growth and value to our shareholders in the coming years.


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