Wednesday, September 21, 2016

News: Xeros makes major progress in developing and commercialising platform technology

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Xeros, a cleantech company based in Rotherham, has boosted income but is still trading at a loss as it continues to invest in its R&D programme for its "disruptive innovations."

Based on the Advanced Manufacturing Park (AMP), Xeros is a Leeds University spin-out that has developed a patented system using a unique method of special polymer beads rather than the usual large amounts of fresh water to clean clothes.

In raising a further £40m in a share issue at the end of 2015, the The AIM-listed firm has boosted its R&D and engineering teams as it commercialises the technology. The patent portfolio currently comprises 40 patent filings which cover polymer bead technologies in applications from commercial and domestic laundry through to leather, metal surface treatments and information/communications technology.

In its interim results for the six months ended June 30 2016, Xeros reported that earned income increased by 148% to £807,000 compared to the same six months to June 30 2015 (£325,000). 116 commercial laundry machines were installed in the period bringing the estate to 278. Service income from these machines has increased significantly.

Looking ahead, the group said that: "We are in advanced discussions with a number of industry partners to speed up market penetration and returns. We have a plan to penetrate the consumer laundry market in what we believe is an achievable series of steps."

In the leather industry which uses masses amount of water, tannery trials using the polymer beads have achieved reductions in water consumption by approximately 60% and effluent mass by around 50%. The total leather market is estimated to be £50bn per annum and unlike laundry, the Xeros technology can be adopted without the need for tanneries to buy new machines.

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The group spent £2.7m on R&D including staff on the AMP and patent costs. This contributed to an adjusted EBITDA (earnings before taxes) loss of £7.4m, increased from a loss of £5.6m in the comparative period.

Rothbiz reported last month on the progress being made on the third generation of polymer beads. Three specific applications have been selected for further R&D within the Xeros Technology Centre on the AMP and scale trials have been pencilled in. The company is coy about the new applications but they are as big as laundry and leather and should have a shorter development lifecycle.

Mark Nichols, chief executive of Xeros, said: "It's now clear that we have a disruptive bead technology platform that can be commercialised across a range of global industries.

"In Commercial Laundry, we are increasingly accepted in a customer segment which has the capacity for thousands of machine installations. We are in detailed discussions with a number of leading market participants, and we are confident of achieving an annual installation rate of 2,000 per annum in the year of 2020.

"We have developed a low risk pathway to establishing our washing and cleaning technology for use by end consumers. A global OEM is currently evaluating the benefits of our technology.

"The pace of our Leather Processing trials in conjunction with our development partners, Wollsdorf Leder Schmidt in Austria and LANXESS, has accelerated ahead of our own expectations. We aim to achieve large scale commercialisation by the end of 2018.

"We have selected three new application areas for development, which we expect to have the same commercial potential as Laundry and Leather Processing. Whilst there is a great deal of R&D and engineering work to be done, we have set our teams the task of achieving successful scale trials in each of these three new areas by the end of 2018."

Xeros website

Images: Xeros


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