8 February 2017 – update
The company has announced that it expects its trading results for 2016 to be in line with analysts’ forecasts. Headline cash was £9.2m on 31 December 2016 of which £3.4m was in energy trading accounts. Flow Energy has been performing well and annual turnover from its current customer base should be around £135m. However, growth may be difficult to deliver given increasing competition. The company is therefore considering selling this business in order to fund ongoing commitment to the microCHP boiler, which is seen as having considerable long term potential. If Flow Energy is not sold then funds will need to be raised by placing new shares or bringing in strategic investors. There is a great deal of uncertainty and it is no real surprise that the share price is weak. We keep our SPECULATIVE BUY rating but this is one for those with plenty of appetite for risk at this stage.