A firm which posts annual turnover of £4,000 and losses of more than £2m is poised to be a global leader, its directors believe.
Applied Graphene Materials yesterday published its first full year financial results since listing on the AIM stock exchange, with pre-tax losses widening to £2.3m.
But the Redcar business is operating in a pioneering sector with the potential to accrue hundreds of millions in revenue – and it is one of only three UK manufacturers in this sector.
The firm, founded by Professor Karl Coleman in 2010, manufactures graphene, a wonder substance no thicker than a single atomic layer of carbon which is stronger than diamond, completely impermeable and heralded as the best conductor of electricity and heat.
Around 20 global companies produce graphene, which is renowned for the part it plays in tennis racquets used by Andy Murray and Maria Sharapova, yet the last 12 months has seen the Teesside firm focus on how it can applied to a whole range of sectors.
The firm has identified over 20 sub-sectors within three target markets, from coatings for the marine industry to polymers for the aerospace industry.
It is currently focussing on sending samples to potential partners rather than commercial quantities – but the portfolio of potential customers represents a good spread of large potential demand and includes likely “nearer term” adopters.
Chief executive Jon Mabbitt said: “At the start of which there was really only a tennis racquet that declared the incorporation of graphene.
“We can see progress reported in touch screen technology, down-well oil drilling lubricants, printable inks with security tagging, electrodes in lithium-ion batteries and selectively permeable membranes for filtration systems and water desalination. The list is growing.
“The main areas are things we’ll put graphene into and those are oils andlubricants, paints and coatings and polymers and composites and each of those products will be used in automotives, chemical industry and so on, so that’s where we are trying to find interest, what the opportunities are, what are the challenges and how they need to be improved upon – that’s where we are focussing our efforts.”
The firm first floated on the Alternative Investment Market (AIM) last November, raising £11m through the placing of around seven million shares.
That strategic move onto the market gave the firm the capital it needs to invest in the staff and business infrastructure that will support anticipated future growth and development of the business.
Since the flotation, the firm has trebled its workforce – and new recruits join the firm this month taking headcount to 30.
Chief financial officer Oliver Lightowlers said: “We would expect to see losses at this time. That’s why we wanted to raise the money last November because we recognised that to be able to exploit the opportunities we needed capital to be able to do that. The shareholders saw the vision and bought into it the fact that there’s significant opportunity.
“I expect it will be loss-making next year as well and it’s difficult to say how quickly it will generate revenue, but we’re confident it will happen.
“It’s difficult to say how much but we are very confident that there’s a graphene opportunity that could be worth hundreds of millions of pounds, if you try to compute the size of the worldwide market.”
As well as technical and operations staff, the company has established an international business development team, geared up for working with global firms in sectors of their expertise.
Mr Mabbitt said: “We now have geographic coverage across mainland Europe and Asia enabling us to support customers on a global basis.
“We have employed individuals from our core target market sectors since their knowledge and understanding of sector supply chains and the nature of the opportunities therein are critical to helping us approach each target market in the right way.”
“We are trying to position ourselves so we are a global leader in the market. To do that you have to invest ahead. We have to speculate to accumulate and we are going about it aggressively and pro-actively.”