http://www.afcenergy.com/

Dawnay, Day Corporate Broking Research Note

Aim Admission Document

If all plans come to fruition then the next 6 months is looking very good indeed.

I won't be one of those saying the sp will be X amount by Xmas, but surely if all plans do come together the sp must in six months be well on the way to being plus 50p and I hope that is a very underestimated figure.

What I would like to see is a second automated extruder being ordered, as it would be prudent for AFC to be in position to be able to full fill orders as they come in, that way they would be ahead of the game.

This would also show confidence in both their product and their ability to interest potential customers.

And again the sp drops, which as said before hows that nothing short of contracts will do for the market.

Greekman - sadly true - contracts or no movement.

Hi Skinny, I have been put right re the Extruder, as the one already in place is easily capable of supply requirements for many months or years yet due to its capabilities.

It is the auto fixing process that need to be looked at.

MOU signed with Chang Shin Chemical for up to 5MW fuel cell power system

Agreement is the first significant breakthrough into the South Korean market to produce clean energy for grid supply

AFC Energy plc, the industrial fuel cell power company, is pleased to announce that it has signed a Memorandum of Understanding (MOU) with Chang Shin Chemical Co., Ltd ("Chang Shin"), a leading South Korean hydrogen supplier, for multiple fuel cell systems with a total potential generating capacity of up to 5MW.

This is the first commercial agreement signed by the Company in South Korea, one of the world's fastest growing markets for large scale, stationary fuel cell power generating systems.

AFC will harness hydrogen produced at Chang Shin's chemical works to generate clean energy with zero carbon emissions. The power will then be delivered into the South Korean electricity grid, thereby enabling Chang Shin to diversify its revenue stream and achieve greater value from its hydrogen.

In line with AFC's strategy, the deal will be structured as an energy supply contract under which it will install and operate its low cost fuel cell systems at Chang Shin's sites in return for long term fees. The agreement will be implemented in stages, the first of which will be a pilot KORE fuel cell unit at one of Chang Shin's gas processing facilities. Following evaluation from both AFC Energy and Chang Shin the intention is for the pilot unit to be scaled up to systems with an envisaged capacity of between 1 MW and 5MW. Importantly, Chang Shin estimates it has total available hydrogen for power generation significantly in excess of 5MW.

AFC and Chang Shin will work towards finalising a definitive contract within six months from the date of the MOU.

Ian Williamson, CEO AFC Energy, said: "This agreement is the first step towards a potentially major long term collaboration with Chang Shin. We have made this important breakthrough into South Korea just as this country's demand for fuel cell systems is set for strong growth. We look forward to working with Chang Shin and expect to clinch further new business in this market in the near future."

Sang Do Bae, Chairman of Chang Shin, said: "We are delighted to collaborate with AFC Energy to utilise their fuel cell systems in an environmentally friendly and sustainable process. It will enable us to harness our supply of hydrogen to generate saleable clean energy and meet stringent government regulations. It is our hope that this initial agreement will lead to the deployment of fuel cell systems in multiple Chang Shin plants in due course."

South Korea is one of the Company's key target markets, where fuel cells are being adopted rapidly by industry and utilities to reduce reliance on imported fossil fuels. Whereas the country is poor in natural resources, it has an abundance of available hydrogen and syngas that is produced as a byproduct by its large chemicals industry. In addition, demand is also being driven by South Korea's comprehensive incentive regime to boost the use of clean energy from fuel cells by large-scale producers and users of electricity.

Ends

Looking good, a breakthrough in South Korea is what we have all been waiting for.

SP not up much and sells now coming in.

I feel that this is due to many thinking that they will have around 6 months to see any further increase in the SP due to that time period being mentioned up to contracts being hopefully signed, with of course some profit taking.

As for myself, I feel that to be out now or to reduce holdings could be playing a very dangerous game as who knows just how many more MOU's are just round the corner.

Also we should not forget that South Korea is not the only country showing interest.

I'm surprised the sp is still blue, not the usual pattern on good news! :o)

Courtesy AFC FORUM ADMIN on AFC shareholder website

So 34 cents revenue, minus CAPEX and OPEX costs of 6 cents, minus Hydrogen costs of 10 cents, leaves 18 cents profit.

1 megawatt is 1000 kw/h
8760 hours in a year
Equals 8,760,000 kw/h per year
8,760,000 x 18 cents is $1,576,800 per annum to AFC, £927,529
5 megawatts is $7,884,000 per annum to AFC, £4,637,647

So on that basis AFC would be a profitable company!

"enabling Chang Shin to diversify its revenue stream and achieve greater value from its hydrogen"

So Chang Shin will get more money for it's Hydrogen via AFC than by selling it's Hydrogen to others. In that case it's likely they will increase AFC usage well past 5 megawatts as they have way more Hydrogen production.

If AFC are going to sell the power to the grid then that must be the only way to get the subsidy, otherwise they would sell the power direct to Chang Shin

Landmark agreement signed for stationary fuel cell systems in South Korea

Breakthrough deal, supported by a leading Korean investment bank, is expected to be worth $3.75m, increasing up to $15m upon satisfactory completion of the first phase

AFC Energy, the industrial fuel cell power company, is pleased to announce that it has entered into a Heads of Agreement with Daniel Inc., a fuel cell focused power plant owner and development company in South Korea, for an initial 1MW fuel cell system with a follow-on option for a further 3MW project making a total potential sales value of approximately $15 million.

The Company believes this agreement, once ratified with a formal contract, will represent the largest sale in revenue terms by any British fuel cell manufacturer in South Korea for a stationary system in an industrial setting. It will also represent the biggest deal won by AFC Energy since its inception in 2006.

The initial 1MW alkaline fuel cell system will be deployed in stages and will include a long term maintenance agreement. Under the terms, a deposit of $1.25 million will become payable to AFC Energy upon signing of the formal contract and supply agreement, before deployment of the system commences. The formal contract will also include the opportunity for a follow-on order for a 3MW system at a second site, depending on performance.

The first system will use a mixture of liquefied natural gas (LNG) and biomass gas as its primary energy source to generate electricity. AFC Energy will install, operate and maintain its low cost fuel cell systems at Daniel Inc's. site and the project will benefit from South Korea's clean energy incentive program that focuses on the aggressive deployment of fuel cells by large electricity producers and users.

This project has been facilitated with the assistance of KDB Daewoo Securities ("Daewoo"), South Korea's leading investment banking firm, acting as introducer for AFC Energy. Daewoo have indicated that going forward they will continue to support the Company in a referral function for other client companies and will receive appropriate compensation.

This agreement is the second major advance made by AFC Energy in South Korea and follows a Memorandum of Understanding announced earlier this week with Chang Shin Chemical Co., for the supply of multiple fuel cell systems with a total potential generating capacity of up to 5MW. In addition, the Company is already executing a Euro 6.1 million EU-backed flagship project, Power-Up, with Air Products at a major chemicals complex in northern Germany. It also has an ongoing strategic project with AkzoNobel at their site in Bitterfeld, Germany.

Hi Skinny,

Not many of us stalwarts left on here.

I like these two comments most.

1 According to Kepco, the state-owed Korean electricity utility, the total installed capacity for stationary fuel cell systems is estimated to increase from 306MW at present to approximately 780MW in 2015 and almost double again by 2020.

I should hope that AFC take a decent slice of the increase between now and 2020.

2 Upon successful implementation of the 1 and 3MW phase projects, there will be follow up ventures which will be the main ones in our planned portfolio and we are confident to say that AFC's role would grow along with our expansion."

3 Many (great word many, much better than few) of our other clients have already demonstrated a clear interest in AFC Energy's fuel cell systems and we look forward to making further introductions of the technology to the region.

So the AFC rocket lifted on Monday and now looks like nothing (probably should not temp fate) will stop it.

Greekman, lets hope so - finally!

Shhhhh! :o)

I have just sold a few at .30.5p.

Strange I know, but I have been caught out before by not banking a profit.

What's a profit?

About 4 weeks ago I bough some AFC in my ISA account, the amount I sold today was the equivalent number of shares from my nominee account.

I looked at my buy 4 weeks ago as a temp increase, and did it this way instead of a bed and isa as I expected the sp to rise and did not need the cash at the time.

As for the profit, it will pay for my August holiday in Greece, so for a change my timing worked out well.

Well done - nice when it works like that.

Cheers Skinny,

A few good decisions among the bad does help.

Sp on it's way down as expected due to profit taking.

I would think that there should be some media coverage tomorrow and over the weekend, there was some after the MOU earlier in the week, but not much.

Just heard on the news that Sainsburys have taken one of their stores off the national grid and are now powering that store from energy generated from food waste.

Sainsbury's already collects all its food waste and many other companies have to either collect or separate food waste from general waste, so no doubt some of these companies will start to look toward cheaper on or near site energy.

In the case of the Sainsbury store it is now connected to a power plant by a 1 mile long underground cable.

I wonder if they have heard about AFC and whilst appreciating that stores are not a priority for AFC (remember the John Lewis update) who knows who and what an AFC Fuel cell will power in the not too distant future.

The future for energy supply is becoming more and more expensive, but with a little help from AFC it might not be quite as expensive.

http://www.extremetech.com/extreme/183690-ceramic-fuel-cells-could-be-the-future-of-green-at-home-power-and-heat-generation

Appointment of new Finance Director