RNS Number : 4773N
GETECH Group plc
23 January 2023
23 January 2023
Getech Group plc
("Getech" or the "Company" and with its subsidiaries "the
Post-Close Trading Update
Consistent Year-on-Year Double-Digit Growth with Record Order
Book and Strong Pipeline
Getech (AIM: GTC), a company that locates energy and minerals
for the energy transition, is pleased to announce an update on
trading for the year ended 31 December 2022 and current
Financial Highlights - Continued Growth
-- Double-digit revenue growth, ahead of market expectations:
GBP5.0 million (FY2021: GBP4.3 million) with a 66%/23% split
between transitional petroleum and critical minerals
-- Record orderbook: GBP4.6 million, a 39% increase (31 December
2021: GBP3.3 million, +25% on 2020)
-- Strong cash position: GBP4.3 million at 31 December 2022,
with cash held flat across H2 2022 by sales momentum and careful
capital management (31 December 2021: GBP5.9 million)
Strategic Progress - Aligned to Global Energy Transition
-- War in Ukraine led to renewed focus on energy security and
underlined the role of oil and gas as transitional sources of
primary energy. In 2022, Getech continued to benefit from high
petroleum customer retention rates and, by aligning its offering
with carbon storage solutions, Getech is futureproofing its role in
a sector that is expected to remain a significant near-term engine
-- In the last two years, Getech has built new low carbon
solutions for critical minerals, geothermal, green hydrogen and
carbon storage by repurposing data and software that it developed
for the petroleum industry.
o Value proven - In 2022, customers have purchased Getech's
solutions to locate copper, gold, cobalt, and helium, to manage
carbon storage licensing rounds and to explore for geothermal
energy. Getech is now expanding its offering to include lithium and
o Significant potential to scale-up revenue from other sectors
looking to decarbonise - In 2022 Getech secured its first fast
moving consumer goods customer, delivering an integrated
decarbonisation solution for their global portfolio of assets that
helps them achieve their ESG objectives.
-- When locating energy and minerals, Getech may selectively
obtain a carried/low-cost interest at the early stages of an
asset's life cycle, in lieu of revenue, thereby building an asset
base to create long term shareholder value. Getech will retain
multiple options to monetise such positions with the aim to
maximise value and minimise capital risk.
o Getech has formed a strategic partnership with Eavor , a
global geothermal technology company, to jointly locate and
appraise closed-loop geothermal projects in Latin America.
o At Shoreham Port, Getech increased phase 1 hydrogen design
capacity from 800 kg/day to 2.5 tonne/day due to bigger local
demand and extended its commercial exclusivity to 2027.
o In Invern ess, progress was slowed by a reshuffle in the
executive team of council officers and a focus on securing the
Cromarty Firth Greenport. Discussions with the Highland Council
about the Highland Hydrogen Network have now regained momentum.
o To accelerate value creation and reduce Getech's direct costs
in establishing green hydrogen transportation hubs , the Company is
advancing discussions with strategic investment partners and
progressing significant grant funding opportunities .
-- Getech starts 2023 with a strong balance sheet, sales
pipeline growth, plus good customer and partner momentum. Getech's
Board has no current plans to raise capital from shareholders.
-- Work to sell Kitson House is progressing, and the property is
currently under offer. However, completion of this sale has been
impacted and delayed by the ongoing volatility in the commercial
-- The macro environment outlook remains strong for companies
such as Getech that are focussed on the energy transition. F
orecasts indicate that a $1 trillion per annum increase in energy
investment is required to resolve the dual challenge of energy
affordability and security, across both clean energy and
Dr Jonathan Copus, Getech CEO commented:
"Our consistent year-on-year growth reflects the strength of our
integrated solutions and the urgency of energy security and
transition. Leveraging our unique digital twin of the Earth with
400 million years of data we are well-positioned to analyse the
subsurface for the benefit of accelerating net zero achievement. We
can locate sweet spots for geothermal energy, critical mineral
deposits, hydrocarbon accumulations, zones for carbon storage, and
the best places for green hydrogen mobility sites."
"While we are making good progress with our development projects
at Shoreham and Inverness we also continue to generate revenue from
our extensive data, cross-sector expertise and advanced analytics
through licensing and solution sales."
"Looking ahead, we are confident that our solutions will gain
even more momentum as every company is now facing the challenge to
decarbonize their activities. We have a strong pipeline for this
year and beyond, which will fuel the company's continued growth -
unlocking value for all stakeholders."
Getech's strategy is to deliver near term revenue growth through
energy and minerals solutions sales and build longer term
shareholder value through select asset participation .
Getech generates revenue by locating new energy and mineral
resources. The Group does this with its proprietary digital twin
model of the Earth ("Globe") that combines significant amounts of
data with a software interface which allows users to make sense of
this data. Developed across twenty years, and built originally for
the petroleum industry, Getech has repurposed Globe to also locate
critical minerals, geothermal energy, hydrogen, and carbon storage
Globe uniquely models the Earth's evolution over the last 400
million years, and its integrated geologic, climatic, and
oceanographic data provides valuable insight to locate natural
resources in the subsurface. Value is further enhanced through
advanced analytics that integrate above-ground socio-economic
energy-demand data and allow users to filter potential locations
for the most cost-effective solutions. The resulting solutions are
provided in an easy-to-use digital map.
By operating across multiple sectors, Getech is uniquely
positioned to collaborate with companies and governments at each
step of their energy transition journey, delivering diversified yet
integrated, low-carbon solutions to accelerate their path to net
For longer term value creation, Getech is also monetising its
unique data, software and expertise through early-stage asset
opportunities. Shoreham and Inverness are the prime examples of
creating long term shareholder value. As its asset operations
mature, Getech's Board envisages a path to spinning entities out -
establishing their own boards, capital structures and strategic
In order not to overextend its resources and to retain an
efficient capital structure, the Company seeks to build strategic
partnerships where in exchange for locating assets Getech receives
a carried/low-cost interest at the early stages of an asset's life
Getech is advancing partnerships with various Development
Expenditure investors. These provide asset-level investment to
advance projects to the point where they are ready for construction
and capital financing. At that point, the project may be sold for a
Developers' Fee, or the parties can remain invested with a minority
or carried interest. In late 2022, Getech signed a Heads of Terms
on the first of these partnerships, which focuses on its hydrogen
In 2022, Getech signed over 100 new contracts with a total value
of GBP6.5 million. This lifted revenue by 16% to GBP5.0 million
(FY2021: GBP4.3 million) and marked the second consecutive year of
double-digit revenue growth since Getech completed its GBP6.25
million equity raise in 2021. 66% of revenue came from transitional
petroleum while 23% - from critical minerals. The Company aims to
further diversify its revenue streams.
A key component of this growth has been license-based and
recurring in nature. In 2022, the number of software licences sold
rose by 42% and Getech secured two new customers for Globe.
This growth expanded Getech's orderbook by 39%, to GBP4.6
million, a record year-end position (31 December 2021: GBP3.3
million). Annualised recurring revenue increased 14% to GBP2.4
million (31 December 2021: GBP2.1 million).
Getech finished 2022 with a strong cash position of GBP4.3
million (31 December 2021: GBP5.9 million). The Group held its cash
balances flat across H2 2023 through sales growth and careful cost
management in its hydrogen asset development operations.
Work to sell Kitson House (Getech's office in Leeds) is also
progressing, and the property is currently under offer. However,
completion of this sale has been impacted and delayed by the
ongoing volatility in the commercial lending market.
Whilst being marketed for sale, Kitson House's general and
rateable costs have been minimised by moving out of the building's
listed portion. To maintain its condition for sale, GBP50k was
spent in 2022 on general maintenance and roof repairs - the
majority of which was funded from insurance.
Having begun 2023 with balance sheet strength, sales pipeline
growth and good customer and partner momentum, Getech's Board has
no current plans to raise capital from shareholders.
In 2022, Getech focused its resources on energy transition
challenges where it could test the commercial value of its data and
software. The success of this work is clear.
Transitional Petroleum - High Retention Rates, Continued
The road to reducing greenhouse gas emissions to zero by 2050
has never been more urgent, but geopolitical tensions, supply chain
disruptions and rising inflation have led to renewed focus on
Experts argue the energy industry has been under-investing since
the peak of 2014 while the overall growth of the investments in
renewables was not sufficient to compensate for that. In the coming
years, focus will be on balancing climate goals with energy
As a result, 2022 saw a strong recovery in Getech's petroleum
market activities, alongside an expansion into the emerging carbon
storage sector. Getech's work in exploration, development
optimisation and operational spatial management has been
These new market conditions led to Getech adding two new Globe
customers, one of which is a global supermajor energy company, and
a 42% year-on-year increase in the number of software subscriptions
sold. Alongside new software sales in the petroleum exploration
market, including a strategic national oil company customer in the
middle East, Getech added further customers in the US onshore shale
gas operations and investment banking sectors. A key strategic
contract with a major energy company joint venture was renewed for
multiple years, providing critical visibility of strong future
By aligning its petroleum offerings with carbon storage, Getech
is future-proofing its role in a sector that is expected to remain
a significant near-term engine of revenue. Along with new software
customers in the carbon storage sector, Getech's solutions were
used by the North Sea Transition Authority to support the UK's
first carbon storage licensing round.
Critical Minerals - Identifying New Copper Deposits, Other
Critical Minerals Are Underway
Getech's first critical minerals solution is focused on copper,
the supply gap of which is expected to reach 7.8 million tonnes by
2030. Getech has the technology to discover new sediment-hosted
copper deposits in unexplored areas. Sediment-hosted copper
accounts for just c.20% of total copper production today, but it is
more widely distributed than other sources of copper and can also
be processed with lower carbon footprint. In addition, 80% of
cobalt, a key component of batteries which plays a critical role in
the energy transition, comes from sediment-hosted copper mines.
In 2022, Getech sold its sediment-hosted copper solution to
three critical minerals companies. Using its unique data and
advanced analytics, Getech produced high confidence targeting maps
for areas in Australia, North America, and Canada, and based on
this work a significant land position has already been licenced.
The value-add for these companies is demonstrated by them now being
Getech also secured its largest ever critical minerals contract
(a $900,000 data and software deal with a multi-mineral global
mining company) and expanded its copper solutions into iron
oxide-copper-gold and epithermal gold deposits. Getech delivered
data and analytics to Helium One, a native helium explorer, and
advanced R&D work on solutions t o predict the location of
lithium and natural ('white') hydrogen resources. Getech looks
forward to bringing these new solutions to market in early 2023.
The World Bank projects that the production of critical minerals,
such as graphite, lithium and cobalt, should increase by nearly
500% by 2050 to achieve a below 2degC future.
Getech is in discussion with mining companies to form strategic
partnerships to jointly locate new deposits, with the option for
Getech to retain a low-cost equity stake or net smelter
Green Hydrogen - Assets Progress and Expanded Offering
In 2022, Getech continued to invest in green hydrogen assets.
The Group's most advanced projects are in Shoreham Port and
Inverness, where H2 Green - Getech's wholly owned hydrogen
development company - is working to establish green hydrogen
production and supply hubs.
In Shoreham, following the completion of engineering and
commercial feasibility work, the Port extended H2 Green's
exclusivity on all hydrogen, ammonia and renewable energy
activities to August 2027. Evidence of demand for hydrogen has
grown faster than expected - supported by offtake pledges, letters
of intent and MoUs. As a result, H2 Green has expanded the phase 1
design capacity from 800 kg/day to 2.5 tonne/day and has kicked off
Pre-FEED (Front End Engineering Design) studies on this basis.
In Inverness, H2 Green's partner, SGN, successfully completed
the deconstruction of the city's former gas holder. This work paves
the way to convert a legacy natural gas holder site into a future
green hydrogen storage and distribution facility, which is an
encouraging step in the process to develop a multi-hub green
hydrogen network, with Inverness at its core. Commercial
negotiations with the Highland Council to advance the hydrogen
network across the Highlands progressed more slowly than hoped.
This was due to a reshuffle in the Council's executive team and
their focus on successfully securing the Cromarty Firth Greenport.
With both now completed, the Council's focus has returned to
Getech's Highland Hydrogen Network and an agreement is expected to
progress in a timely manner.
Through this project work, Getech and H2 Green have built
extensive expertise in locating and developing green hydrogen sites
- skills which in 2022 generated GBP100K of revenue from regional
hydrogen network planning for the Scottish Highlands. Having
encountered demand for these skills from other potential customers,
Getech plans to launch a hydrogen advisory service in 2023 which
will broaden its exposure to business development and manage direct
The macro environment continues to be supportive for hydrogen
development, with the UK hydrogen strategy targeting 10GW of low
carbon hydrogen production capacity by 2030. Green hydrogen is
forecasted to reach 15% of Europe's final energy mix long term.
Geothermal - Building Partnerships
Getech supports the geothermal sector through its Heat Seeker(R)
solution, which combines advanced geospatial analytics with
commercial, geoscience and social data. This enables the rapid and
cost-effective identification of sites that are highly prospective
for geothermal energy . In 2022 Getech successfully completed
projects for clients on multiple continents, and the Group expects
continued expansion of its geothermal offering - given the
projected double-digit annual growth rate towards 2030 in
geothermal energy investments.
Getech and Eavor, a global geothermal technology company, have
signed a strategic partnership to jointly locate and appraise a
portfolio of geothermal projects in Latin America. Eavor was
already a customer of Getech's data and services. Through this work
Getech has generated revenue, demonstrated its geothermal
expertise, and built mutual trust. This has now translated to an
asset-based partnership that is broader, more strategic and more
valuable for both parties.
Eavor has attracted venture capital funding from BP, Chevron and
BHP (all customers of Getech petroleum solutions) and recently
secured development financing, totalling up to EUR1bn, from Deep
Energy Capital, for the development of at least five geothermal
projects in North America and Europe.
Using its proprietary Heat Seeker(R) solution, Getech is also
evaluating very early-stage geothermal asset investment
opportunities in locations outside Latin America.
Integrated Decarbonisation Solutions - Potential to Open a New
Global Customer Market
By leveraging the breadth of its low carbon activities, Getech
has recently secured a contract with a global FMCG company. Getech
will deliver to this customer an integrated decarbonisation
solution across its global portfolio of assets to achieve its ESG
objectives. With companies across multiple sectors now looking to
turn decarbonisation planning into practice, this win opens an
exciting door to a potentially vast universe of new customers with
significant potential to scale-up revenue.
Marco Environment and Outlook
Goldman Sachs forecasts a $1 trillion pa increase in energy
investment is required to resolve the dual challenge of energy
affordability and security, across both clean energy and
At the same time, the incremental cost of net zero carbon
continues to improve making it more financially attractive. The US
Inflation Reduction Act is potentially the most transformational
policy in clean tech making green hydrogen, carbon capture and
geothermal some of the more cost-effective paths for energy
transition in the US. Across the globe many governments are moving
in a similar direction with various economic stimulus, including
tax credits and subsidies.
Getech's corporate strategy reflects this underlying trend and
focuses on monetising the Company's core capabilities in most
efficient and valuable ways.
The Group is growing its order book and pipeline and the Board
is confident in the outlook for the business.
Getech will present at Cenkos and Proactive Growth &
Innovation Forum on 7 February and Proactive One2One Investor Forum
on 28 February. The Company will host an investor site visit to
Shoreham in March 2023 and intends to publish its Final Results for
the 12 months ended 31 December 2022 in May 2023.
The Company will hold an investor call to discuss the business
update later this week. Details will be communicated
This update is provided in advance of the financial statements
for the year ended 31 December 2022. The information and commentary
provided is based on unaudited management accounts and other
internal performance measures and is subject to concluding the
routine annual accounting adjustments as well as any adjustments
that arise as a result of the external audit process. Certain
statements made in this trading update are forward-looking
statements. Such statements are based on current expectations and
are subject to a number of risks and uncertainties that could cause
actual events or results to differ materially from any expected
future events or results referred to in these forward-looking
For further information, please contact:
Getech Group plc Tel: 0113 322 2200
Dr Jonathan Copus, Chief Executive
Irina Logutenkova, Head of Investor Relations
Cenkos Securities plc
Neil McDonald / Pete Lynch (Corporate Finance)
Michael Johnson / Dale Bellis (Sales) Tel: 0207 397 8900
Camarco Tel: 020 3781 8331
Tom Huddart / Toby Strong / Charles Dingwall
Notes to editors:
Getech Group plc (AIM: GTC) generates revenue by locating new
energy and mineral resources using its proprietary Earth digital
twin. The Group works for governments and companies who seek to
decarbonise their operations. Getech expanded the use of data and
technologies built for petroleum industry to critical minerals,
geothermal, hydrogen, carbon storage. Getech's work builds
strategic partnerships that open early-stage asset opportunities.
In exchange for locating assets Getech may seek a carried interest
during the development phase and option to monetise the
For further information, please visit www.getech.com .
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