Analyst presentation

Ceres Power Holdings plc will be hosting a live webcast for analysts and investors on 26 September 2025 at 09.30 BST. To register your interest in participating, please go to:

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About Ceres

Ceres is a leading developer of clean energy technology: fuel cells for power generation and electrolysers to produce green hydrogen. Its asset-light, licensing model has seen it establish partnerships with some of the world's largest companies, such as Doosan, Delta, Denso, Shell, Weichai and Thermax. Ceres' solid oxide technology supports greater electrification of our energy systems and produces green hydrogen at high efficiencies as a route to decarbonise emissions-intensive industries such as steelmaking, ammonia and electrofuels. Ceres is listed on the London Stock Exchange ("LSE") (LSE: CWR) and is classified by the LSE Green Economy Mark, which recognises listed companies that derive more than 50% of their activity from the green economy. Read more on our website at www.ceres.tech or follow us on LinkedIn.

Chief Executive's statement

Introduction

Ceres has now crossed over from being an R&D company to one that is firmly in a commercial production phase as first Doosan initiated manufacturing of our SOFC technology in South Korea at the end of July 2025 and then Delta announced plans for the building of its manufacturing facility for products using Ceres technology in Taiwan.

Over the past year power and hydrogen markets have experienced opposing trends as we have experienced significant changes in both the energy and the political landscapes. We have seen a marked increase in near term demand for fuel cells for power solutions in contrast to challenges in the demand and rate of deployment for hydrogen projects in some parts of the world. There is now growing demand for clean power that can be deployed rapidly and our licensees' first products are targeting this power market which is being driven by increased demand from AI data centres and electrification. The hydrogen market continues to be a significant opportunity for both Ceres technology and our licensees but we believe this will follow the power market, benefiting from the maturity and scale achieved by our partners.

This shift towards commercialisation was underlined at the end of last year when several R&D projects concluded, enabling us to reduce operating costs and accelerate our commercial activities. Ceres sales teams are now present on the ground in key territories such as China, Asia Pacific, India and the US, supported by new marketing initiatives and programmes.

Business transformation

Both Ceres and the markets we serve are entering transformational phases.

The massive global investment in AI-related data centre infrastructure is emerging as one of the most significant trends in the world economy, with the resulting pressure on power resources coming sharply into focus. In response the demand for fuel cell power systems is projected to accelerate rapidly to fulfil the expanding data centre sector's need for power to support the growth of this industry. Whilst, the hydrogen opportunity also remains significant, we believe this market will follow later. Therefore, in the near-term Ceres will focus on servicing the growing fuel cell power market. This strategic approach will be underpinned by a solid technology roadmap to deliver continuous generational improvements to maintain our technology leadership position.

For Ceres, 2025 is set to be a landmark year with the commercial launch of our technology through the Doosan partnership, Delta's investment in a facility in Taiwan and product development of our dual purpose (power & electrolysis), latest generation stack platform which will be launched next year.

These milestones mean that Ceres is firmly stepping into the full commercial phase of our business and technology. To drive and support this, we are initiating a 12-month business transformation programme that will prepare the Company for the next phase of growth. Specifically, by the end of 2026, we will have:

·      Restructured and realigned the business to the market opportunity, embedding new ways of working

·      Commercially launched our best in class, dual purpose stack platform serving both power and hydrogen markets

·      Supported existing partners on their manufacturing journey to join Doosan in launching products using Ceres technology

·      Established commercial opportunities to attract new manufacturing partners wishing to adopt our industry leading solid oxide technology

·      Reduced our operating costs showing continued financial discipline

Phase one of the business transformation programme, which Ceres aims to complete by the end of 2025, is an operational restructuring and realignment of resources. As a result, going into 2026 the Company expects operating expenses to be reduced by around 20% compared to the year ending 31 December 2025.

Market landscape and opportunities

Ceres achievements should be seen in the context of a market landscape that has evolved rapidly over the past year. Demand for power continues to grow strongly, driven by the needs of industrial electrification, the rise of AI-driven data centres, energy grid reinforcement and ongoing electrification. By 2030, there is projected to be a 150 GW capacity requirement for data centres globally, potentially accounting for up to 4,500 TWh of electricity consumption by 2050 (rising from 5% to 9% of total electricity consumption)^[1].

Power applications in the data centre industry present distinct near-term opportunities for Ceres solid oxide technology given its many advantages over conventional power generation. The rapid rise of AI-driven data centres has catalysed demand for new power solutions that offer rapid time-to-power deployment, 24/7 reliability and high efficiency. With wait times for grid connections or delivery of power units such as gas turbines now exceeding five years, the data centre industry is seeking alternative power systems, including solid oxide fuel cells.

In addition to the data centre market, other attractive power applications continue to mature. These include, distributed power through microgrids, combined heat, power and cooling applications for buildings and auxiliary power systems for marine vessels. Some regions are also introducing favourable tax incentives for the adoption of fuel cells, such as the 30% Investment Tax Credit under Section 48E of the USA's One Big Beautiful Bill. Similar incentives have been established in South Korea (the Green New Deal aims to achieve fuel cell deployment of 15 GW by 2040, supported by tax and other incentives); and Japan (Green Transformation policies supporting the establishment of a hydrogen economy, including the development of stationary fuel cell power stations).

Lead times for electrolyser final investment decisions for hydrogen projects remain a challenge for the industry, exacerbated by macro-economic headwinds. Unlocking these opportunities will take time and resource, but we remain confident that the long-term imperative to decarbonise industrial processes will continue to drive the market and that this will open up the opportunity for the electrolysis industry to adopt more advanced technologies such as solid oxide over incumbent technologies.

Ceres solid oxide technology offers superior operating efficiency and cost benefits with our electrolyser systems delivering an operating efficiency improvement of around 30%, compared to PEM or alkaline systems. Our cells are primarily built from steel, an abundant, low-cost and recyclable material, further reducing raw material costs for our manufacturing partners. Finally, our use of the ultra-thin ceramic layers within the cell minimizes material usage and reliance on expensive critical minerals used in other electrolyser technologies which may become harder to source as businesses look to localise supply chains due to import tariffs.

Delivering commercial progress across the business

Ceres ended 2024 with record annual revenue and order intake following twelve months of significant commercial progress, culminating in two new manufacturing licence wins and a systems licence partnership. As each licence deal was secured Ceres teams started the process of technology transfer, with respective partners spending time at Ceres facilities. Much of this work was completed in 2024 with the focus switching during the first half of 2025 to supporting partner factory design and development as well as the establishment of local supply chains for raw materials.

In parallel with onboarding new partners such as Delta, Denso, and Thermax, Ceres teams continued to work with existing partners to advance their factory plans. In February 2025, Bosch announced a strategic decision to realign its operations and investments in stationary fuel cell power technologies. The stationary hydrogen-to-power markets in Europe had not developed as Bosch expected, leading it to discontinue its development of solid oxide fuel cells and terminate its relationship with Ceres. While this was disappointing our portfolio approach to partnerships and licence geographies has reduced the financial impact, as other partners continued to progress towards commercial launch while demand for these applications has only increased.

Doosan reaches a major milestone

One of our key fuel cell manufacturing partners, Doosan, announced in July 2025 that it had formally started production of stacks and fuel cell power systems based on Ceres technology at its state-of-the-art 50MW factory in South Korea. This marked a significant milestone for both companies, with the world's first commercial-scale production factory using Ceres' solid oxide technology coming on-stream. This paves the way for the anticipated royalty payments from Doosan, validating the Ceres approach to IP protection and its licensing model.

Doosan will supply solid oxide power systems initially in South Korea, with a primary focus on stationary distributed power applications. This includes uses in AI-driven data centres, the stabilisation of renewables-based power grids and microgrids through peak power production, power systems for buildings and auxiliary power solutions for the marine shipping markets.

Delta building momentum

Taiwanese partner Delta Electronics has been building momentum in solid oxide technologies at pace. Within a year of signing a manufacturing licence agreement with Ceres in January 2024, Delta inaugurated Taiwan's first megawatt-grade R&D research centre for electrolysis and fuel cells in December 2024. The Delta Net Zero Science Lab, located at the company's Tainan Plant 2, provides a broad testing environment for validating solid oxide hydrogen production and fuel cell technologies. Ceres's SOFC technology has already been applied in Delta's microgrid pilot projects, integrating renewable energy, energy storage, and power management systems to establish low-carbon, high-efficiency distributed energy grids.

In July 2025, Delta announced the purchase of 112,000 square meters of land and factory facilities in Taoyuan City, Taiwan, for approximately NT$6.95 billion (c.£170 million). The facility is expected to focus on large-scale manufacturing of hydrogen energy solutions including Ceres' solid oxide technology for data centre power, microgrid and other energy infrastructure applications. Delta is a leader in specialised power systems for the AI-driven data centre market, offering a range of products including power supply and control systems and cooling solutions.

Progress in electrolysis

Ceres has also made important progress on the electrolysis side of its business. The Company's first megawatt-scale SOEC demonstrator system, located at Shell's Technology Centre in Bangalore, India, started to produce hydrogen in May 2025. This marks a key milestone in the industrial maturity of Ceres' solid oxide electrolyser technology, supported by Shell's installation, integration and safety assurance expertise. The collaboration will now run for a five-year operational phase with the potential to produce hydrogen at 600 kg per day at full capacity with an industry-leading electrolyser module efficiency of 37kWh/kg of hydrogen. Ceres and Shell continue to collaborate on pressurised solid oxide modules that can scale from 1MW to 10MW capacity. This is anticipated to lead to the development of modular designs that could be further scaled to hundreds of megawatts for integration into industrial plants.

Denso, which was announced as a manufacturing partner in August 2024, completed the technology transfer process and passed through key milestones, enabling it to understand the fundamentals of our technology. It is now making progress and developing this knowledge into the preparation for its factory design process, with Ceres teams supporting as required.

Systems partner Thermax has also been moving ahead in its relationship with Ceres, having established its HydroGenX Hub in Pune, India. This is an incubation centre for the evaluation and development of green hydrogen technologies and solutions for hydrogen production, storage and applications.

The increased commercial and partner progress has further improved Ceres' standing in the global energy transition movement. In June 2025 Ceres became a member of the Hydrogen Council, an influential CEO-led organisation of leading energy, transport and industrial companies working to position hydrogen as a key solution to the challenges of energy transition. The Council plays a critical role in uniting stakeholders across the hydrogen value chain around the world, fostering collaboration between industry, investors and government.

Financial review

Revenue for the six-month period ended 30 June 2025 was £21.1 million, compared to £28.5 million in the same period of 2024. The prior period included significant one-off licence revenue following the signing of the Delta agreement. In H1 2025, one-off revenue was recognised following the successful commissioning of the demonstrator operated by Shell in Bangalore. In addition, revenue from existing partners, Delta and Denso, continued as the Group supported ongoing development activities.

Gross profit of £16.6 million in the period (H1 2024: £22.9 million) decreased when compared to the prior year due to the impact of significant one-off licence revenue which has no associated cost of sales in H1 2024. Gross margins remain high at 79% (H1 2024: 80%), which illustrates the Company's asset-light, licensing business model.

Overall operating costs before exceptional costs decreased in H1 2025 to £35.6 million (H1 2024: £37.9 million) reflecting maintained investment in core technology to drive future growth balanced with disciplined financial management. Exceptional operating costs relate to an impairment of the investment in the associate, RFC Power Limited, and a settlement agreement, more detail is found in Note 23. As these costs arise from events outside the ordinary course of business, they have been presented separately within the statement of profit or loss to provide clarity on the Group's underlying operating performance. Research and development (R&D) costs totalled £25.6 million, up from £23.3 million in the comparative period. Although higher than 2024, underlying cash investment remains in line with expectations. The increase in the reported H1 2025 figure is mainly due to accounting effects, including a full half-year of amortisation and lower capitalisation of development costs following peak activity in 2023. 

Adjusted EBITDA loss for H1 2025 increased to £11.3 million (H1 2024: £9.0 million). Adjusted EBITDA is a non-statutory measure and is detailed in the Alternative Performance Measures section in this review. The movement from 2024 is primarily due to the high margin revenue recognised in 2024 as explained above.

Capital expenditure in the half decreased to £2.1 million (H1 2024: £2.8 million) largely as a result of significant investment in our testing capability.  Capitalised development costs reduced to £nil compared to £1.3 million in the prior year period. We have assessed our internal development activities and concluded that incremental redesigns do not meet the criteria for capitalisation. Technical feasibility is typically confirmed only after detailed design and formal approval, at product integration. Given the high level of uncertainty and risk throughout, we expense these costs as incurred.

Ceres recognised a cash inflow in the period (change in cash, cash equivalents and short-term investments) of £1.6 million (H1 2024: outflow of £13.9 million). This was driven by significant customer receipts and an R&D tax credit due on 31 December 2024 was received in January 2025. Ceres therefore ends the period in a strong position with £104.1 million in cash, cash equivalents and short-term investments (H1 2024: £126.1 million, 31 December 2024: £102.5 million). This will support future investment as the Company drives revenue growth, maintains discipline over costs and expenditure and tracks towards profit and cashflow break‑even.

Principal risks and uncertainties

The Directors have reviewed the principal risks and uncertainties that could have a material impact on the Group's performance and have concluded that there have been no changes from those described in the Ceres Annual Report 2024. A summary of the Group's principal risks can be found at the end of this report.

Outlook: building commercial traction

The progress we have achieved with our partners has improved our business balance, with near-term power opportunities becoming more evident and long-term industrial decarbonisation prospects likely to bear fruit for our electrolysis business over the longer term. Currently, our primary focus is on securing new licence agreements in the commercial power markets to meet the energy demands of AI-driven data centres. The Company will realign its resources to support a greater commercial focus through its new business transformation plan.

We are continuing to position ourselves as key players in the electrolysis markets, building relationships with technology manufacturers, systems integrators and green hydrogen off-takers. With two exciting market opportunities now in front of us, addressing power first and hydrogen following, and benefiting from a mature and scalable single product approach, we are confident that we have the strategy to establish our technology as the industry standard for solid oxide.

Phil Caldwell

Chief Executive Officer

Responsibility Statement

The directors confirm that to the best of their knowledge:

·    the condensed set of financial statements has been prepared in accordance with UK adopted IAS 34 'Interim Financial Reporting'; and

·    the interim management report includes a fair review of the information required by DTR 4.2.7 (indication of important events and their impact, and a description of principal risks and uncertainties for the remaining six months of the financial year) and DTR 4.2.8 (disclosure of related parties' transactions and changes therein).

The full list of current Directors can be found on the Ceres website at https://www.ceres.tech.