Energy storage provider INTILION plans IPO

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Energy storage provider INTILION plans IPO

• INTILION, a provider of innovative, modular and scalable energy storage solutions, plans an initial public offering on the regulated market of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) (Prime Standard) in the third quarter of 2023.
• The energy storage solutions are used by commercial and industrial customers as well as utilities and grid operators to stabilise electricity grids, reduce grid expansion costs and peak loads, ensure security of supply and increase the efficiency of the integration of renewable energies. INTILION thus makes a direct contribution to the energy transition.
• INTILION has grown at a compound annual growth rate of around 147% over the past three financial years.¹ In the current financial year ending 31 March 2024, revenues are expected to more than double to over EUR 70 million. In the medium term, revenues of around EUR 250 million are targeted.
• Net proceeds from the offering of the new shares will be used to provide financing for working capital requirements to promote future growth, the expansion of development capabilities, the development of new business models and the geographic expansion.

Paderborn, 27 June 2023 – Energy storage provider INTILION Aktiengesellschaft ("INTILION" or "Company") is planning an initial public offering with admission of its shares to trading on the regulated market of the Frankfurt Stock Exchange (Prime Standard) in the third quarter of 2023, subject to the capital market environment. The initial public offering is expected to include a public offering in Germany ("IPO") and private placements outside Germany of primarily new shares from a capital increase of the Company, as well as existing shares held by the Company’s sole shareholder HOPPECKE Rail Systems GmbH (a subsidiary of Accumulatorenwerke Hoppecke Carl Zoellner & Sohn GmbH).

The Company intends to use the net proceeds from the offering of the new shares to (i) provide financing for the Company's working capital requirements to promote future growth, (ii) make investments in companies with the aim of accelerating the Company's software knowledge, developing its virtual power plant business model to enable the bundling of storage capacities for energy trading purposes and expanding the Company's research and development team, and (iii) fund the geographic expansion of its sales, engineering and fulfillment capabilities. HOPPECKE Rail Systems GmbH will continue to hold a majority interest in INTILION following the completion of the proposed IPO.

Dr André Haubrock, CEO of INTILION, says: "Efficient energy storage systems are elementary for a successful energy transition. We have extensive experience in stationary energy storage solutions and have already installed over 200 lithium-ion storage systems of various sizes for industrial customers and utilities. We offer our customers all three necessary solution components from a single source: firstly, the scalable hardware including additional peripherals such as converters, switchgear and transformers; secondly, the monitoring and application software to operate the storage system according to the customer's wishes; and thirdly, the entire project management with installation and commissioning of the system and long-term service to guarantee availability and performance. We have thus established an excellent starting point and now want to open the next chapter in the company's development and systematically continue on our growth path".

Dirk Engel, CFO of INTILION, says: "As electrification progresses and the share of renewable energies increases at the same time, energy storage systems will play a crucial role in ensuring a stable power supply. The global market for energy storage is expected to grow by 37% per year until 2030.² With our good positioning, we want to achieve an attractive market share and thus create long-term added value for our shareholders. We are pursuing a clear growth strategy and have grown by an average of around 147%¹ in the past three financial years."

Comprehensive energy storage solutions for commercial and industrial customers and grid applications
The installed storage capacities of INTILION's energy storage solutions range from 70 kilowatt hours (“kWh”) to 100 megawatt hours ("MWh") and are aimed in particular at commercial and industrial ("C&I") end customers (up to 5 MWh) as well as small, medium and large grid applications (up to 100 MWh). INTILION thus addresses the "Front-of-the-Meter" ("FTM") and "Behind-the-Meter" ("BTM") market segments of the market for energy storage solutions. In the FTM market segment, electricity is generated by the generator, e.g. a power plant, a wind farm or a solar farm, and stored before being transmitted through the grid and passing through a meter (which measures electricity consumption) to the consumer. In this market segment, utilities use the energy storage systems as buffer storage systems that draw electricity from and release it back into the grid to maintain grid stability. In the BTM market segment, the energy storage system is positioned between the consumer and the meter, where it can be used to store electricity that the consumer draws from the grid or is generated by the consumer, e.g. by wind or solar energy. The energy storage systems help commercial and industrial end users to meet their energy needs flexibly and efficiently. For this purpose, the solutions of INTILION enable the storage of surplus energy generated from renewable energy sources. This can be used as a source of residual electricity when energy consumption is high and little electricity is generated from wind and solar power. This relieves the electricity grids and avoids costly peak loads (so-called peak shaving).

Flexible business model for intelligent energy storage solutions
With its flexible business model, INTILION offers innovative, modular and scalable energy storage solutions and associated services primarily for commercial and industrial applications and for use in the power grid. For all storage solutions, INTILION offers a full-service package that is open to all technologies. To this end, INTILION works closely with a broad network of partners. INTILION accompanies the customer from the initial consultation and planning of the individually optimal storage solution to the on-site installation and ongoing operation. INTILION integrates the battery storage systems into the customer's overall system via the intelligent energy management system and monitors the functionality of each module throughout the entire operating phase.

The Company currently focuses on the German, Austrian and Swiss markets, with Germany as the most important geographic market based on revenues. In the future, the Company aims to expand into selected European countries, including the United Kingdom, Ireland, Italy, Spain and Portugal.

Established relationships with a strong client base
Customers include large utilities and distributors as well as engineering, procurement and construction (EPC) contractors and C&I end customers. INTILION thus benefits from a broad customer base from industry and utilities.

Global trends and regulatory requirements drive growth in the market for energy storage systems
INTILION believes it is well positioned to benefit from growth in the market for energy storage systems. The global market for energy storage systems is expected to grow by 37% annually to reach 231 gigawatt hours per year by 2030³. The market with storage systems from 70 kWh to 100 MWh, in which INTILION is active, is expected to account for around two-thirds of the storage capacities.³ Global trends are leading to the increasing demand for energy storage solutions.

The integration of decentralised renewable energies into the power grid poses challenges for the supply of energy, as uneven power generation can lead to fluctuations in energy prices and grid utilisation, making decentralised solutions more important. At the EU level, the European Green Deal aims to achieve climate neutrality in Europe by 2050. In addition, the "Fit for 55" package shall reduce greenhouse gas emissions by 55% by 2030 compared to 1990. All initiatives require a significant expansion of renewable energies. In addition, the electrification of many sectors is advancing, which will increase the demand for electricity and energy storage. These effects cause increasing volatility on both the generation and the consumer side, which must be balanced out with appropriate storage systems in order to guarantee the energy supply in the long term.

Strong company growth planned
INTILION has achieved high growth rates in revenues in recent years. In the three financial years ended 31 March 2021, 2022 and 2023, revenues grew at a compound annual growth rate of around 147%1, faster than the market for energy storage systems, which grew by an average of 98% in the same period.2 For the current financial year ending 31 March 2024, INTILION is planning to more than double revenues to over EUR 70 million (2022/2023: EUR 29.9 million) based on the order backlog of EUR 63.2 million as of 31 March 20233 and the expected business volume for the scalebloc, scalestac and scalecube product lines of INTILION. In the medium term, INTILION targets to grow revenues to approximately EUR 250 million with an adjusted EBIT margin4 of between 8% and 10%.

B. Metzler seel. Sohn & Co. Aktiengesellschaft is acting as Sole Global Coordinator and, together with Stifel Europe Bank AG, as Joint Bookrunner for the IPO.

About INTILION Aktiengesellschaft
INTILION Aktiengesellschaft (“INTILION”) is a provider of innovative, modular and scalable energy storage solutions (ESS). The product and service portfolio is particularly suitable for use in system-relevant and critical infrastructures such as commercial, industrial and power grids. The storage capacities of the company’s intelligent lithium-ion-based ESS products range from 70 kWh to 100 MWh. With its range of solutions and services, INTILION is a forerunner on the way to a decarbonised, flexible and digital energy sector, enabling the transition towards climate-neutral, renewable and clean energy use. INTILION’s customers include local, regional and international utilities and energy distributors, as well as system distributors and engineering, procurement and construction (EPC) contractors within Europe. INTILION is headquartered in Paderborn, Germany, and belongs to the family-owned HOPPECKE Group, with a heritage of more than 95 years of expertise and engineering excellence in batteries. For further information, please visit https://intilion.com.

Contact:
Mario Groß
Mail: intilion@kirchhoff.de 
Phone: +49 40 60 91 86 83

Sources and footnotes:

¹  Based on (i) the revenues from the energy storage systems business of HOPPECKE Rail Systems GmbH, which was spun off to the Company as receiving company with effect from 1 April 2023, and from the Company’s own limited business activities for the financial years ended 31 March 2021 and 2022 and (ii) the revenues of the Company for the financial year ended 31 March 2023.

²  Wood Mackenzie – Global Energy Storage Market Outlook Update: Q4 2022, December 2022, Wood Mackenzie Ltd.; the base year for the calculation of the growth rate is 2020.

³  The Company defines its order backlog as the sum of transaction prices related to firm orders or contracts as at the respective balance sheet date that are not yet completed.

⁴  The Company defines Adjusted EBIT margin as the ratio of Adjusted EBIT to revenue. The Company defines Adjusted EBIT as earnings before interest and taxes (EBIT) adjusted for extraordinary expenses and extraordinary income, including costs related to the IPO and future acquisitions and other non-recurring expenses and non-recurring income.

IMPORTANT NOTICE
This release does not contain or constitute an offer of, or the solicitation of an offer to buy or subscribe for, securities, to any person in the United States of America (including its territories and possessions, any state of the United States of America and the District of Columbia, the "United States"), Australia, Canada, Japan or in any jurisdiction to whom or in which such offer or solicitation is unlawful.

This release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the “Securities Act”). Any public offering of securities to be made in the United States would be made by means of a prospectus that could be obtained from INTILION Aktiengesellschaft (“Company”) and that would contain detailed information about the company and management, as well as financial statements. There will be no public offer of the securities in the United States.

Subject to certain exceptions, the securities referred to herein may not be offered or sold in Australia, Canada or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada or Japan.

Certain statements contained in this release may constitute "forward-looking statements" that involve a number of risks and uncertainties. Forward-looking statements are generally identifiable by the use of the words "may", "will", "should", "plan", "expect", "anticipate", "estimate", "believe", "intend", "project", "goal", "target" or "aim" or the negative of these words or other variations on these words or comparable terminology. Forward-looking statements are based on assumptions, forecasts, estimates, projections, opinions or plans that are inherently subject to significant risks, as well as uncertainties and contingencies that are subject to change. No representation is made or will be made by the Company that any forward-looking statement will be achieved or will prove to be correct. The actual future business, financial position, results of operations and prospects may differ materially from those projected or forecast in the forward-looking statements.

Neither the Company nor B. Metzler seel. Sohn & Co. Aktiengesellschaft and Stifel Europe Bank AG (together the "Syndicate Banks") nor any of their respective affiliates assume any obligation to update, and do not expect to publicly update, or publicly revise, any forward-looking statements or other information contained in this release, whether as a result of new information, future events or otherwise, except as otherwise required by law.

This release also contains certain financial measures that are not recognized under International Financial Reporting Standards ("IFRS"). These non-IFRS measures are presented because the Company believes that they and similar measures are widely used in the markets in which it operates as a means of evaluating operating performance and financing structure of the Company. They may not be comparable to other similarly titled measures of other companies and are not measurements under IFRS or other generally accepted accounting principles.

The Syndicate Banks are acting exclusively for the Company and the selling shareholder and no one else in connection with the planned offering. The Syndicate Banks will not regard any other person as their clients in relation to the planned offering and will not be responsible to anyone other than the Company and the selling shareholder for providing the protections afforded to its clients, nor for providing advice in relation to the offering, the contents of this release or any transaction, arrangement or other matter referred to herein.

In connection with the planned offering, Syndicate Banks and their respective affiliates may take up a portion of the shares offered in the offering as a principal position and in that capacity may retain, purchase, sell, offer to sell for their own accounts such shares and other securities of the Company or related investments in connection with the planned offering or otherwise. In addition, the Syndicate Banks and their respective affiliates may enter into financing arrangements (including swaps or contracts for differences) with investors in connection with which the Syndicate Banks and their respective affiliates may from time to time acquire, hold or dispose of shares of the Company. The Syndicate Banks do not intend to disclose the extent of any such investment or transactions, other than in accordance with any legal or regulatory obligations to do so.

Neither the Syndicate Banks nor any of their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this release (or whether any information has been omitted from the release) or any other information relating to the Company, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available, or for any loss howsoever arising from any use of this release or its contents or otherwise arising in connection therewith.

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This release is an advertisement within the meaning of the Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (“Prospectus Regulation”) and legislation in connection therewith. It is not a prospectus. The public offering in Germany and admission of the shares of the Company to trading on the regulated market of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) is subject to the publication of a prospectus. The prospectus is expected to be approved by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – "BaFin") in accordance with the Prospectus Regulation. However, the approval of the prospectus by BaFin should not be understood as an endorsement of the shares of the Company. Investors should purchase shares solely on the basis of the prospectus relating to the shares and should read the prospectus before making an investment decision in order to fully understand the potential risks and rewards associated with the decision to invest in the shares. The prospectus will, following approval of BaFin, be available free of charge on the website of the Company (www.intilion.com) under the “IPO” section.