Message of Welcome

Welcome to the second edition of our quarterly investor update. During the last quarter the company has seen significant progress on Regulation, Patents and development of our new Combined Heat and Power (CHP) plant.

Most importantly, we have developed a strong sales pipeline for our Fluidised Bed System in the UK Poultry Market with closing decisions on a number of deals expected in the next quarter. We have also won 2 new Toploader projects with a combined value of €450k.

We are now entering a significant chapter in our company’s history during this commercialisation phase. Our regulatory success has created a new ‘manure to energy’ market for the poultry sector across the EU and converting leads to sales will establish bhsl as the market leader.

I hope you enjoy the newsletter and as always thank you for your continued support of the business.

Yours sincerely,

Declan O’Connor

Regulatory Update

On June 3rd, the long wait for regulatory approval ended when Rules to enable poultry farmers to use their manure as a fuel in combustion on farms were published in the Official Journal of the European Union.

Publication occurred in the Commission Regulation (EU) No 592/2014 of 3 June 2014 Amending Regulation (EU) No 142/2011 as regards the use of animal by-products and derived products as a fuel in combustion plants. Because it is a Regulation it will come into force as written in all 28 EU Member States on July 15th (and be accepted in the EEA countries such as Switzerland and Norway).

Click to view publication

bhsl has been the industry leader behind this Regulation so it is fitting that Nigel & Patrick Joice who has two bhsl FBC 500 combustion plants installed on his farm in Norfolk received the first formal conditional approval in the UK under this new Regulation from the AHVLA (see picture above).

The AHVLA has put the application form for those farmers who wish to be approved on their web site here. bhsl has been profiled extensively in the July edition of the Poultry World.

Click here for link to article

The publication of Regulation 592/2014 heralds the start of a new era for EU poultry farmers to be authorised to use their own poultry manure to provide energy on their farms.

Commercial Update

Sales Pipeline

From February there has been growing awareness of our Poultry Manure system. Since June 3rd when the rules were finally published, the level of interest has grown significantly and we are now working with two of the major integrators on development of detailed proposals. The value of the current proposals is £40m with future business from these corporate clients worth in excess of £200m.  We are engaging a team of professionals to support the delivery of our Marketing and Sales strategy. This team will bring a huge amount of experience to help us access our target market successfully.

UK Integrators

We are working closely with two of the largest Integrators in the UK poultry market who between them represent 60% of the market. We are developing solutions for over 200 company owned farms between the two firms. We have also developed a funding facility for clients by third party investors.

UK Independent Farmers

We have made significant progress with a number of Independent farmers which we are managing through structured process. Our current product offering is suited to the larger poultry farms with a flock size of 200,000 birds or more.  We are actively engaged with over 20 farmers who have over 30 farms in their ownership.

European Market Study

In the last quarter we completed a detailed market study of the European poultry market plus associated incentives schemes being offered by the various European governments. Clearly the UK is our primary market but we will be engaging in Dutch, German and French markets over the coming 6 months to prime new markets for 2015. The largest integrator in France, LDC (1000 contracted farmers) will visit Uphouse Farm on the 9th of July.

Project Financing

Our Corporate Finance advisers in London have connected us with two large investment funds whose core focus is renewable energy. Both funds are backed by the UK Government’s Green Investment Bank and have expressed interest in providing a £10m investment in bhsl’s initial projects.  We have also attracted the interest of boutique funders to invest on a farm-by-farm basis with private farmers.