Betolar Plc’s financial statements release for 1 January–31 December 2021 (unaudited): Green light for growth and internationalisation

Betolar Plc

Company Release 25 February 2022 at 8:30 a.m. EET

Betolar Plc’s financial statements release for 1 January–31 December 2021 (unaudited)

Green light for growth and internationalisation

This is a summary of the 2021 Financial Statements Release, which is in its entirety attached to this release and can be downloaded from the company’s website at https://www.betolar.com/investors

January–December 2021 in brief

• Net sales amounted to EUR 10 thousand (EUR 6 thousand)
• Gross margin1 amounted to EUR 6 thousand (EUR 192 thousand)
• EBITDA1 amounted to EUR -3,171 thousand (EUR -1,053 thousand)
• Operating profit (loss) was EUR -3,859 (EUR -1,373 thousand)
• Net profit for the period amounted to EUR -7,329 thousand (EUR -1,385 thousand)
• Earnings per share1,2 were EUR -0.70 (EUR -0.18)
• Cash and cash equivalents at the end of the period amounted to EUR 37,355 thousand (EUR 644 thousand)
• The number of pilot customers1 increased to 12 (5)
• The average number of personnel during the period increased significantly to 23 (12)
• Betolar raised approximately EUR 34.5 million gross in the IPO

Key events in the 2021 financial period

•         Betolar shifted its Geoprime® concept from the research and development phase to the commercialisation phase in Finland and internationally.

•         Several cooperation and pilot project agreements aiming to deploy the Geoprime® concept were signed during the second half of the year with Ruskon Betoni Oy, Lujabetoni Oy, Kiilto Oy, JA-KO Betoni Oy, IBF A/S and TARA.

•         The Finnish Climate Fund granted a capital loan of EUR 7 million to Betolar in November for digital platform development

•         Betolar’s operating system was certified in accordance with ISO 9 001, ISO 14 001 and ISO 45 001.

•         Betolar successfully strengthened its growth financing by organising a financing round of EUR 5 million and agreeing on a convertible bond of EUR 4.5 million. 

•         Betolar’s shares were successfully listed on the Nasdaq First North Growth Market Finland marketplace, accumulating capital of approximately EUR 35 million. The number of shareholders increased in the IPO to over 4,300.

The figures in brackets in this report refer to the comparison period, i.e. the same period in 2020, unless otherwise specified. The figures for the comparison period are based on the audited financial statements.

Board of Directors' proposal on the use of distributable unrestricted equity

The Board of Directors proposes that no dividend be distributed for the financial period 1 January–31 December 2021 and that the loss for the financial period be carried over under retained earnings.

Key figures

1)       Betolar uses certain alternative performance measures (gross margin, EBITDA, EPS and number of pilot customers) as indicators of operational profitability and performance.  The definitions and calculation formulas of these measures are enclosed to the report. 

2)       The number of shares used in the calculation of earnings per share is as follows: 31 December 2021: 19,444,024 and 31 December 2020: 7,853,868 

CEO Matti Löppönen comments on the 2021 financial year

For Betolar, 2021 was a year of preparing for the commercialisation and scaling up of the Geoprime® solution, which will immediately reduce the CO2 emissions of the raw material of concrete significantly. In order to accelerate research and development, as well as for domestic and international growth, the company strengthened its balance sheet, expertise and cooperation network. The launch of the commercial phase of business operations has continued in line with the objectives, following the industrial licensing agreements signed after the end of the financial year in early 2022. It is a clear indication of the functionality and appeal of the Geoprime® concept among industrial operators.

Early in the year, we carried out a EUR 5 million financing round and, at the same time, got new owners that will support the company’s growth. The year culminated in the company’s listing on the First North Growth Market Finland marketplace on 9 December 2021 and the IPO that was carried out in connection with it, in which we raised EUR 34.5 million in gross funds for the implementation of the growth project. In addition, the Finnish state’s Climate Fund granted Betolar a capital loan of EUR 7 million for the development of the AI platform.

Betolar’s business is based on three pillars, which enable the green transformation of the concrete industry in particular, cut CO2 emissions caused by cement, and reduce the consumption of virgin resources. The company’s scientific and industrial understanding of materials technology forms a strong starting point for the company’s development. A significant factor in the implementation of the strategy is the company’s Geoprime® concept, which guarantees the usability, quality and commercial appeal of the solutions to customers by providing them with the required support for green binder solutions on an industrial scale. In addition, through the development of the AI platform, we aim to bring efficiency and certainty to our research activities and to our customers’ industrial processes. 

The message of Betolar’s green transformation has attracted well-deserved interest among industrial companies and received significant positive media coverage. Betolar’s business environment became remarkably favourable in early 2021. Real estate investors and developers have clearly expressed their interest in our solutions. Regulation is steering construction and industry extensively towards green, sustainable solutions.

A significant group of Finnish universities and companies in the binder, concrete and mining industries have joined us in developing our solutions together. Cooperation agreements with Kiilto Oy, Keliber Oy, Ruskon Betoni Oy and Lujabetoni Oy ensure the strong customer orientation of our operations and the functionality of the solutions being developed. The goal is that all product development work will lead to significant scalable industrial solutions globally. At the same time, they allow our partners to conduct sustainable business in their home markets. Positive sustainable action has attracted skilled employees who want to promote the large-scale adoption of low-carbon solutions.

As a company, Betolar is moving into the commercial phase. Enabled by successful materials development, we have completed a significant number of new industrial customer pilots in 2021. These totalled 10 pilot customers in Europe and 2 pilot customers in Asia. The results of the Geoprime® pilots mainly concerning dry press products have been very encouraging. The aim is that they will lead to commercial agreements. Potential customers in Europe are interested in learning about our solution, piloting product groups, and negotiating on genuine commercial agreements. In Asia, we have begun to prepare to build a commercial and technical organisation and carried out the first industrial pilot projects in India and Indonesia.

To strengthen the company’s business capability, development potential and international scalability, we strengthened the Board of Directors and the Management Team with successful recruitments last year. CFO Riikka Ylikoski (June 2021) and CTO Pekka Hintikka (September 2021) joined the company’s Management Team, strengthening it with their significant industrial management expertise and competence. As the company sought to move towards international commercial operations and develop its capability of launching stabilisation and mining business solutions to the market, the composition of the company’s Board of Directors was also changed as planned. The term of office of Juha Pinomaa, Timo Mäkelä and Markus Kallio, who had served Betolar well, ended in July 2021, when Kalle Härkki, an expert in the mining and processing industry, and Soile Kankaanpää, an experienced international commercial scaling expert, were elected onto the Board of Directors.

Both the investor community and industrial companies have shown their confidence in the Geoprime® solution and Betolar’s ability to scale it up internationally. This year, our task is to prove that we are following the path we have planned.

Board of Directors’ proposal for the distribution of profit

The parent company’s distributable unrestricted shareholders equity amounted to EUR 37,055,474.83 on 31 December 2021. The parent company’s loss for the financial period was EUR ‑7,134,732.38.

In the years to come, Betolar will focus on financing its growth and developing its business operations in accordance with its strategy. The company does not expect to be distributing dividends in the short or medium term. In addition, the terms and conditions of Betolar’s financing agreements include certain restrictions for Betolar’s ability to pay out dividends or otherwise distribute equity. Additional information about the restrictions is available in the company’s listing prospectus under “Financing Betolar’s business”.

The Board of Directors proposes to the Annual General Meeting that no dividend be distributed for the financial period 1 January–31 December 2021 and that the loss for the financial period be carried over under retained earnings.

Annual General Meeting

Betolar Plc’s Annual General Meeting is planned to be held on 23 March 2022. The notice of the general meeting will be published later. 

Annual Report and financial reporting 

The Annual Report for the 2021 financial period will be published on week 9, which begins on 28 February 2022

Betolar will publish the following financial reports in 2022

•         Business review 1–3/2022 will be published on 27 April 2022

•         Half-year financial report 2022 will be published on 31 August 2022

•         Business review 1–9/2022 will be published on 26 October 2022

Betolar's financial reports are available at www.betolar.com/investors.

Webcast for investors and media

Betolar will organise a live webcast in Finnish for investors and media on 25 February 2022 at 10:00 a.m. Finnish time.

The webcast (in finnish) can be viewed at https://betolar.videosync.fi/2021-tulosjulkistus

In the presentation, CEO Matti Löppönen and CFO Riikka Ylikoski will introduce Betolar’s financial statements and other current affairs of the company. A recording of the webcast and a corresponding presentation in English will be available on Betolar’s investor site later during the same day.

Betolar Plc

Further enquiries

Matti Löppönen, CEO, Betolar Plc, tel. +358 50 306 6335
Riikka Ylikoski, CFO, Betolar Plc, puh. +358 40 828 2632

Certified Adviser:
Skandinaviska Enskilda Banken AB (publ) Helsinki Branch, +358 9 6162 8000

About Betolar

Betolar Plc is a Finnish materials technology company that offers the production of sustainable and low-carbon concrete with the Geoprime® solution. The solution converts several previously unused, massive industrial by-products into a cement substitute.

Betolar's artificial intelligence innovation can significantly reduce CO2 emissions compared to traditional cement-based concrete production by optimizing existing manufacturing processes. Betolar’s mission is to enable the green transformation of various industries globally, especially in the construction, process and energy industries by providing solutions to utilise its unique materials technology. For more information, visit https://www.betolar.com/

Betolar Plc Financial Statements Release 2021