Corac Group plc, a group of innovative gas, air and energy technologies businesses will make the following statement at its Annual General Meeting being held in London today.
Trading in the year to date has been encouraging, with the financial performance and cash position in line with expectations, and Group order book rising by 15% since the end of 2013.
The Group's strategy is to drive growth in the immediate term from established markets and to generate long term value from emerging technologies. Group companies have performed well in established markets and have continued to make good progress on technology development for future product lines.
Atmosphere Control International ("ACI")
ACI's order book at the end of March has risen by £2.8m since the start of the year to £8.7m.
Performance and growth forecasts for the year are supported by securing a further order on the Astute Programme in addition to that announced in January, and further contracts in their global export market, announced on 14 January, with existing and new defence customers.
Development work continues on the next generation of enhanced CO2 removal technologies, which directly respond to the needs of future submarine programmes and changing crew requirements as recently reported in the national press.
Corac Energy Technologies ("CET")
CET concentrates on using proven core turbomachinery (compressor and expander) technologies in selected applications, with the most value in the oil and gas and renewable energy markets.
Endurance testing of CET's renewable energy expander was completed in April and discussions with partners are in progress on next steps.The team has also begun work on another contract to develop a pressure let-down expander, which is progressing to plan.
In oil and gas, recently published results have provided positive data to demonstrate the performance and potential additional gas that can be produced using CET's unique in-pipe compressors. These will be developed as the heart of bigger integrated compression systems with selected integration partners, both at the wellhead on land and mounted on offshore production platforms.
Test data and supporting simulation work shows better outcomes in higher performing wells rather than the end of life assets that were the focus of the original downhole development programme. The Board believes these applications on high productivity wells offer the strongest potential to drive the greatest value from CET's technology portfolio.
The platform compression project has successfully passed several technical and compliance gateways and is nearing completion of the detailed design phase.
The core technology development programme, common to compressors and expanders, continues with successful tests of electronic control systems and variants of the gas bearing design, and an enhanced gas flowloop was commissioned in May to allow closer representation of real gas conditions by incorporating solids and liquids in the gas stream.
Proving of the core compressor technology and positive feedback on the platform compression development has led to a full evaluation of other projects and the pipeline of future opportunities. This is ongoing and will identify which projects or opportunities will return the best commercial value to CET and our partners.
Hunt Thermal Technologies ("HTT")
HTT has delivered a steady performance in the opening part of the year. Building on a strong close to 2013, the year-on-year order book has grown by 55% and there is a stronger pipeline in both UK and global markets.
The factory continues to operate at high capacity and the management team remain focused on improving margins.
Funds raised in December 2013 have allowed the Group to commit to its main development goals, specifically:
• supporting the progress of existing part-funded development projects
• building and operation of enhanced test facilities
• performing customer-independent test programmes to demonstrate core capability
Other development options remain in place and are subject to further review.
Group Chief Executive Phil Cartmell commented
"The Board is pleased with progress in the year to date. ACI and HTT continue to underpin the Group's financial performance and are well placed to continue to build on that success. CET is making good technical and commercial progress, focusing on its strongest technical propositions, its potential markets and the business cases of its end user community.
"Trends in our markets are viewed positively - recent concerns over affordability of large scale subsea compression programmes reinforces the case for compact, localised compression systems. Similarly, in the Defence market, the announcement of the first female officers on board submarines and the expansion of naval programmes in Asia and Brazil strengthen the role of ACI in national submarine programmes."