Powered by Ceres
Ceres Power Holdings plc Annual Report 2013 Who we are
Ceres Power (“Ceres”) is a leading developer of low cost, compact, metal-supported fuel cell technology for clean, 
efficient, cost-effective, distributed generation products that can help address the key global energy challenges:
•	 Increasing energy efficiency
•	 Reducing CO
2
 emissions
•	 Increasing energy security
International mass market opportunities exist for cost-effective energy products that can address these global market 
drivers while also meeting practical requirements such as the ability to run on readily available fuels like Natural Gas or 
LPG, and be robust to real world operating conditions.
Ceres Power’s unique compact fuel cell technology can meet these requirements to power homes, business and 
infrastructure more efficiently than today’s solutions.
The Ceres fuel cell stacks and Fuel Cell Modules (“FCMs”), supported by our world class manufacturing and systems 
engineering capability, provide an excellent platform to enable our partners to create a range of products for distributed 
generation and low carbon power applications. These include:
•	 Combined Heat and Power (“CHP”) products for homes, operating on mains natural gas or packaged fuels
•	 Portable and stationary products providing flexible power as alternatives to generators and batteries, operating on 
packaged fuels including LPG, propane and butane
•	 Products providing auxiliary power in transport applications
Ceres was founded in 2001 to commercialise the unique core materials science technology developed at Imperial 
College during the 1990s. In November 2004, it went public on the AIM market  of the London Stock Exchange. 
In 2012 Ceres changed its strategy to focus on licensing its technology rather than selling complete CHP products.  
Today, the Group directly employs approximately 65 people at its development and manufacturing headquarters in 
Horsham in the UK.
Contents
1 Highlights 
2 Business Opportunity 
4 Chairman’s Statement 
6 Chief Executive Officer’s Review 
10 Board of Directors 
12 Directors’ Report 
15 Independent Auditors’ Report 
16 Consolidated Statement of Comprehensive Income 
17 Consolidated Balance Sheet 
18 Consolidated Cash Flow Statement 
19 Consolidated Statement of Changes in Equity 
20 Notes to the Consolidated Financial Statements
38 Independent Auditors’ Report
39 Company Balance Sheet
40 Notes to the Consolidated Financial Statements
44 Directors and Advisors Ceres Power Holdings plc Annual Report 2013   1 
 
 
 
 
 
Highlights  
 
During the reporting period: 
 Restructured the business to reduce recurring operating costs by 44% to £10.2 million 
 Implemented new business strategy of working with global consumer durable product 
manufacturers or ‘Original Equipment Manufacturers’ (“OEMs”) with strong balance sheets 
 Successful targeting of OEM relationships in Japan and South Korea  
 New Board and Leadership Team appointed 
 Substantial progress made with the robustness of Ceres unique low cost fuel cell technology 
 Increase in Fuel Cell Module (“FCM”) gross efficiency to > 50% 
 Intellectual property portfolio further extended at cell, stack and FCM levels 
 £15.4 million in net cash and short-term cash investments as at 30 June 2013 
 
After period end: 
 New CEO appointed, Philip Caldwell, commenced employment on 2 September 2013 
 Commercial Agreement signed with Korea’s largest boiler manufacturer, KD Navien, in landmark 
deal in support of new strategy 
 Commercial traction in Japan with a number of global OEMs in technology validation and test 
activities  
 Collaboration Agreement signed with the University of Connecticut to showcase Ceres’ 
technology and facilitate access to US OEMs and the Department of Energy programmes to 
drive product development in the US 
 
 
   2  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Business Opportunity
The wider picture 
Global energy challenges have been well understood for 
some time; however recent events have increased the 
need for clean and efficient distributed power 
generation. World energy demand is predicted to rise by 
25% (IEA, 2013) over the next decade yet the 
infrastructure to provide a growing population with the 
power they need is struggling to meet this growth. 
Events such as the Fukishima disaster have put more 
pressure on existing infrastructure, not only in Japan, but 
also in countries such as Germany where a change of 
energy policy has resulted in a renewed focus on 
distributed generation and renewable or cleaner solutions. 
Discoveries of shale gas reserves in the US closely 
followed by the rest of the world are extending the use 
of natural gas as a fuel for the foreseeable future but do 
not address the underlying issues of how to reduce CO
2
 
emissions unless new technologies are adopted to 
generate and distribute power more efficiently. 
Fuel cells are one of the technologies which can provide 
cleaner power solutions for a range of market 
applications such as distributed generation through 
micro-CHP, backup or primary power for telecoms and 
transportation. After many years of development we are 
now seeing widespread commercialisation of fuel cell 
products, particularly in the Japanese market where 
sales are being led by global OEMs such as Panasonic, 
Toshiba and Toyota. Sales of residential micro-CHP units 
in Japan under the government backed Ene-Farm 
programme reached 28,000 in 2012 and are continuing 
to grow. In addition, the South Korean government has 
committed to subsidising its One Million Green Homes 
Project for 2020, which is capable of stimulating a similar 
market for fuel cell technology to that seen in Japan.  
Whist Japan and Korea lead the way in developing the 
fuel cell market, developments in other regions are 
accelerating.  In Germany, the government is supporting 
field trials of micro-CHP units under its Callux 
programme and has set a binding CHP target of 25% co-
generated electricity in power production by 2020.  In 
the US large scale fuel cell deployments are being 
backed by bank financing programmes resulting in MWs 
of installed capacity for applications which provide highly 
reliable and efficient power to growing energy 
consumers such as data centres operated by some of the 
world’s biggest consumer electronics and technology 
companies. A number of studies for stationary power 
fuel cell products have suggested that the market size 
could exceed US$10 billion by 2025.  
Whilst the potential of fuel cell technology has been 
demonstrated through successful commercial products 
sold often with government support through subsidies 
and feed-in tariffs, the global OEMs still face the major 
challenge to widespread adoption: of significantly 
reducing costs while achieving operational robustness 
and flexibility. Ceres Power technology offers a step 
change to the existing high temperature solid oxide fuel 
cell (“SOFC”) technology by providing a lower cost, 
robust solution that enables its commercial partners, 
through joint product development and effective 
technology transfer, to produce the next generation of 
clean power products with Ceres’ unique proprietary 
technology at its core.    
What we do 
Ceres Power has developed a technology platform that is 
capable of being mass manufactured using its patented 
unique metal-supported SOFC technology designed to 
operate on natural gas and subsequently on a range of 
other fuels including LPG. 
Ceres Power’s fuel cell stack is a metal-supported solid 
state electro-chemical device which is the core of the 
Fuel Cell Module (“FCM”) which generates electricity and 
heat directly from reformed fuel and air. Unlike the 
combustion process in an engine-driven generator, this 
solid state process is highly efficient, environmentally 
friendly and quiet. The Ceres stacks and FCMs will form 
the core of a range of distributed generation products 
designed with the potential to become the new standard 
for energy provision in millions of homes and thousands 
of commercial and industrial applications around the 
world.  The Group’s initial commercial focus is on the 
South Korean and Japanese markets, for compact 
residential Combined Heat and Power (“CHP”) products 
that replace conventional residential boilers and also 
produce the majority of a typical home’s electricity 
needs. However the Ceres technology can be applied to 
other applications and markets. 
  Ceres Power Holdings plc Annual Report 2013   3 
 
 
 
 
 
 
A typical home uses electricity generated by a central power 
station and transmitted through the electricity grid network 
and uses a gas boiler to meet its heating and hot water 
needs. Centralised generation wastes a significant proportion 
of the energy it uses, through heat losses in the power 
station and transmission and distribution losses. A CHP 
product installed in a home and generating electricity at the 
point of use (so-called distributed generation) avoids these 
energy losses, capturing the heat for use in domestic hot 
water and heating in the home. By creating electricity at the 
point of use in the home, overall efficiency of fossil fuel use 
can be improved from around 35% for centralised generation 
to up to 90% for residential CHP. This increase in energy 
efficiency delivers significant reductions in carbon emissions. 
 
Our technology  
The patented Ceres fuel cell design comprises thin 
electrochemical layers deposited onto a porous stainless 
steel supporting substrate. The cell operates in the 
temperature range of 500–600°C which is substantially 
lower than the temperature at which conventional SOFC 
materials can operate, typically 750–1000°C. The 
inherently lower operating temperature of Ceres’ unique 
SOFC technology and the metal-supported design 
enables the use of proven cost-effective materials and 
manufacturing processes and a fuel cell stack design that 
is robust and resistant to thermal and real-world 
operating cycles. 
 
 
The Group continues to develop its world class 
manufacturing and systems engineering capability to 
supply initial volumes of its high value core fuel cell 
technology to its partners and, at a later stage, to offer 
high volume manufacture under license at various global 
locations to meet our OEM partners’ needs.  
Our commercial proposition 
Ceres Power has extensive and valuable intellectual 
property rights and know-how in three core areas: the 
fuel cell stack, the FCM and fuel cell manufacturing, 
which together will enable our commercial partners to 
develop and manufacture low carbon power products 
under license. The Group’s first platform for licensing 
into the low carbon appliance market is a 1kW stack or 
FCM to be integrated into wall mounted residential fuel 
cell CHP products. Such products will be designed to 
replace conventional household boilers, saving the 
customer around 25% of their annual total energy costs 
and reducing the home’s CO
2
 emissions. By exploiting its 
significant fuel cell system engineering experience, Ceres 
can support and accelerate OEMs and other system 
integrators to evaluate and develop new low carbon 
products for residential and other markets. This unique 
application support capability enables the Group to 
catalyse uptake of its technology and encourage 
economies of scale and standardisation across different 
product platforms.  
Ceres Power already has a technical and commercial 
partnership agreement with KDN Navien, South Korea’s 
largest boiler manufacturer, for the incorporation of its 
technology into a CHP product and is actively looking to 
create similar partnerships in Japan, the US and Europe. 
In Japan, assessment of the technology is being carried 
out with a number of potential OEM partners. In 
addition, Ceres Power retains its longstanding 
partnerships with a range of established corporations 
such as British Gas and Itho-Daalderop with well-
established direct channels to millions of customers in 
the UK, Benelux and Ireland.  New products and market 
opportunities also exist in the longer term beyond 
residential CHP, including fuel cell water heaters for the 
US market, tri-generation, remote industrial power and 
auxiliary power for transport applications. 
  4  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Chairman’s Statement 
The last year has seen the Group make substantial progress against its new 
strategy in both commercial and technical respects following its successful 
restructuring and refinancing at the end of 2012.    
Driven by our technical successes and cost leadership position Ceres is now gaining 
significant commercial traction and I believe it has truly global potential. 
 
Introduction 
Since assuming the chair at the end of December 2012, 
there have been significant changes in the business.  The 
technology team has been reconfigured to support our 
new strategy based on core technology only, with product 
development implemented by our OEM partners.  These 
partners can bring multiple products to market through 
their depth of skills and expertise in systems integration, 
and their balance sheet strength.  The commercial team 
set out to attract OEMs with the vision to build products 
with Ceres technology embedded within them and we 
have made significant progress on all fronts.  Before 
reporting on this, I would like to thank the previous 
Chairman, Brian Count, and his Executive Board for their 
professionalism and dedication to handing over control of 
the business to the newly appointed executive team and 
supporting that team in resizing the business.  I would 
specifically like to single out Rex Vevers, former CFO, and 
Phil Whalen, formerly the CTO, for individual praise.  I 
should also like to extend my personal thanks to Steve 
Callaghan, one of our Non-Executive Directors, who 
implemented the restructure program and supported the 
business and leadership team through the second half of 
the year. His contribution was significant and his many 
years of working with turnaround situations were 
invaluable to the Group.  I am extremely pleased to 
welcome Phil Caldwell, the new CEO, to Ceres, who I refer 
to later in more detail.  
 
I would now like to turn my attention to progress that has 
been made and the work still in progress at Ceres whilst 
outlining our continued strategy for the financial year 
2013-14 and beyond. 
Business strategy and market overview 
In contrast to the previous strategy of aspiring to become 
a product company, Ceres now focuses only on core 
technology at cell, stack and Fuel Cell Module (“FCM”) 
level with accompanying cell manufacturing skills 
necessary to scale the business.  We seek to engage OEMs 
with strong balance sheets, systems and product 
engineering skills in depth, and access to global markets.  
Our key areas of geographic focus remain South Korea, 
whose government have supported up to 80% subsidies 
for micro-CHP domestic installations in conjunction with a 
One Million Green Homes Project by 2020 initiative, and 
Japan, where over 28,000 micro combined heat and 
power (“micro-CHP”) units were sold in 2012.  We are 
also targeting the US, where Intermediate Temperature 
SOFC has recently received positive Governmental 
support, and parts of Western Europe, including Germany 
where their government has made significant and positive 
statements in support of Green Power and where 
subsidies for micro-CHP are noteworthy.   
 
I am particularly pleased with the recently announced 
Ceres deal with KD Navien, South Korea’s largest boiler 
manufacturer. This is a landmark deal and clearly 
demonstrates that the new strategy has found favour 
with OEMs.  There has also been early commercial 
traction in Japan which bodes extremely well for the 
future, and we look forward to working more closely with 
Japanese partners going forward. We will strive to 
conclude more significant commercial deals in our target 
geographies in the coming year.  
 
In addition to micro-CHP applications, we also consider 
our core technology to be suitable for other vertical 
applications and will explore commercial partnerships in 
new markets in the coming year.  
Fund raise and change of advisors 
On 18 December 2012, shareholders approved a placing 
and open offer to raise £3.3 million (before expenses) 
which provided the minimum level of funding required to 
undertake the business restructure, and to establish the 
commercial and technology strategy for the business 
moving forward. On 28 March 2013, shareholders  Ceres Power Holdings plc Annual Report 2013   5 
 
 
 
 
 
approved a placing and open offer to raise £9.5 million 
(before expenses) which provides funding for the first 
stages of the revised strategy and new business model.  
The Group held £15.4 million in net cash and short-term 
cash investments as at 30 June 2013 and, as previously 
noted in our interim results, the Board anticipates that 
further funding will be required in future to fully 
commercialise the technology.  However, we do expect 
that successful commercial engagements will also 
contribute to funding the business in the coming financial 
year. 
 
During the period Ceres also appointed Nplus1 Singer as 
its nominated advisor and DAC Beachcroft as its solicitors.  
For completeness, I can also report that after the period 
end the Group also appointed Tavistock as its financial PR 
agency. 
Technology progress 
Progress has been impressive and I leave it to the Chief 
Executive to provide details of this in his report.  Through 
the remainder of 2013 I expect the technical programmes 
to continue to deliver to our roadmap. 
People 
Ceres has an excellent team which, having been subjected 
to the stresses associated with a >60% reduction in 
workforce during 2012, have worked tirelessly during the 
year, particularly since December, to deliver strong 
technical and commercial progress.  I salute their 
endeavour, endurance and sheer passion shown during 
this year of restructure, refocus and re-engagement 
around the new Group strategy. Following the 
restructuring phase all employees were granted share 
options as both retention and incentivisation measures 
and all key personnel continue to remain in post. 
 
We have in Philip Caldwell, our new CEO, a highly 
commercial business leader with ten years’ experience of 
the fuel cell sector. Phil was previously Corporate 
Development Director at Intelligent Energy, a sizeable 
company which specialises in the development of PEM 
fuel cell systems. He has a strong track record of securing 
OEM partners, and executing licence deals and 
agreements with sector leading global companies across 
automotive, stationary power and consumer electronic 
applications. In particular he was instrumental in 
establishing a joint venture with Suzuki Motor 
Corporation which enabled local manufacture of fuel cells 
under license in Japan. 
 
I also note that Mike Bretherton, who has been Non-
Executive Director since December 2012, will step down 
from the Board on 4 October 2013 following his recent 
relocation to Guernsey.  We wish him well in the future.  
Summary 
The Board of Directors has implemented a business 
strategy based on the technology at the very core of the 
Group’s capability, and is of the opinion that Ceres cell, 
stack and FCM technology has the potential to become 
the global standard for fuel cells for its target markets. In 
due course, the Board is confident that it will deliver 
excellent shareholder value through engineering 
development, licence, supply and royalty revenues.  The 
technical and commercial advances over the past 12 
months have further reinforced Ceres’ position as a 
unique low cost, efficient and durable technology 
platform capable of operating in ‘real world’ conditions in 
multiple vertical and geographic markets. 
 
We believe the current strategy and approach to be in the 
very best interests of our shareholders. 
 
 
 
 
Alan Aubrey 
Chairman 
30 September 2013 
  6  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Chief Executive Officer’s Review 
I am pleased to report on the substantial commercial and technical progress made 
towards our strategy over the past 12 months 
 
Introduction 
Having only been in the office of the Chief Executive for a 
matter of weeks, I am happy to report that over the last 
year Ceres has maintained its market position as the only 
low cost commercially 
viable Intermediate 
Temperature SOFC 
provider. The Group has 
made substantial technical 
and commercial progress, 
and I am delighted to be in 
post.  Under the guidance 
of Steve Callaghan, a 
member of our Board and 
turnaround specialist, the 
Group’s new strategy 
deployed post-restructure in January 2013 has gained 
significant commercial traction and our technology claims 
are being validated by several OEMs.   
Commercial Update 
With KD Navien (“KDN”) we have secured the first stage 
of a long-term partnership funded by KDN where they will 
collaborate with us with the intention to develop and 
commercialise a low cost natural gas fuel cell micro-CHP 
product for the residential and commercial mass market 
in South Korea, as well as other strategic markets.  Over a 
12 month period from July 2013, we will provide KDN 
with our technology to allow them to evaluate its design 
and operating performance. Additionally over the period, 
KD Navien and Ceres will begin the design phase for a 
new 1kW micro-CHP product by leveraging each 
company’s strengths, developing a product 
commercialisation plan and agreeing the commercial 
structures for licensing and development for the next 
phases of the programme. 
In Japan we have early stage evaluation of our technology 
with a number of OEMs which are currently assessing 
performance and application for a number of different 
market opportunities. In the US we have entered into a 
partnership with the University of Connecticut in order to 
demonstrate the potential of our core technology to US 
based OEMs.   
This commercial progress has been successful only due to 
the technical progress made under the continued 
leadership of the Technical Director, Dr Mark Selby, and 
his team.  We have made significant progress around 
stabilising processes and production techniques to deliver 
robustness, opening the road to commercialisation for 
the Group and its partners. 
Technology progress report 
The progress made in the technology over the recent 
period has been excellent in a number of areas and the 
capability of the technology to be truly disruptive remains 
in evidence.  In addition, in due course, I believe the 
technology may be viable for a wider number of higher 
power generation applications and we shall be evaluating 
this opportunity over the coming year. 
Cell and stack development has continued to progress 
with key improvements demonstrated in robustness and 
sustained development of highly repeatable volume 
manufacturing processes. A key area of development has 
been our ‘robust anode’ concept.  This allows us to have 
the unique capability of withstanding harsh real life 
conditions of unplanned stops.  This is a key enabler for 
developing robust, low cost fuel cell products with our 
customers.   
Steady state durability, thermal cycling capability and the 
ability to withstand harsh emergency stops are the key 
metrics that are important to our product development 
partners in their own technology evaluations and we are 
continuing to demonstrate this in our partner 
programmes. In accelerated thermal cycling and 
RedOx/Emergency stop laboratory tests in the harshest 
possible operating conditions, we have demonstrated 
around twice the requirement for a consumer micro-CHP 
product based on this technology. Accelerated testing in 
these metrics is a good indication of the potential for long 
life products. In addition, we continue to progress steady 
state durability on tests that incorporate the latest 
developments of the technology. 
We have made rapid progress in Fuel Cell Module 
(“FCM”) development in the last year, improving 
efficiency to >50% Gross Electrical Efficiency LHV (Lower  Ceres Power Holdings plc Annual Report 2013   7 
 
 
 
 
 
Heating Value). These developments in efficiency improve 
potential savings for domestic micro-CHP containing the 
Ceres technology, based on a conservative UK real use 
case scenario including the current feed-in tariff. This 
allows an expected payback period for the consumer of 
less than five years, based on detailed projected product 
costs.  
The combination of our fuel cells’ intermediate operating 
temperature of c.600
o
C, fuel reforming process and low 
cost metals presents a unique set of engineering 
challenges and opportunities.  Our deep technical 
understanding in this area, and the intellectual property 
that results, presents a great opportunity for us to help 
accelerate our partners’ commercialisation plans for our 
technology. 
Across all areas of the technology we continue to 
generate and protect our intellectual property with the 
primary goal of accelerating the volume uptake of the 
core cell technology and subsidy-free fuel cell products. 
This has already resulted in (and will continue to result in) 
numerous patent filings which strengthen our position 
and protect our competitive advantage.  
The various technology evaluation engagements, which 
began in early 2013, continue to generate significant 
activity within the technology team. To support this new 
aspect of our business, we have recruited a small number 
of key individuals. In 2014 customer funded activity will 
be a major work-stream for us.  In parallel to our ongoing 
customer programmes, we continue to progress our 
roadmap for the Ceres Technology Platform to meet our 
customers’ long-term commercial needs.   
 
Dr Mark Selby 
Director of Technology 
Dr Selby has been with Ceres Power since 2006 and has led the 
technology team since February 2013.  He has deep understanding of 
systems engineering and previously has been responsible for all aspects of 
Product Development activity.  Prior to joining Ceres Power, he was 
a Senior Engineer at Ricardo UK Limited.   He has degrees in Electronics, 
Dynamics and Control Systems awarded by the University of Leeds. 
 
Dr Subhasish Mukerjee 
Director of Cell and Stack Development 
Dr. Mukerjee joined the Company in February 2012.  He is responsible for 
all aspects of the development of cell and stack technology.  He has 
extensive experience in fuel cells having previously worked at Delphi 
Corporation as SOFC Technology Leader.  He holds numerous SOFC 
patents and has published widely on fuel cell technology.  He gained 
his PhD at Yale University. 
Manufacturing and operations update 
We have consolidated our business and manufacturing 
operations to our Horsham site, allowing development 
cells and stacks to be produced within a controlled 
environment.  Our focus on real-world volume 
manufacturing has been a core part of generating 
customer traction, as many of the organisations we are 
engaged with have world class track records and 
experience of quality-driven manufacturing 
environments. 
Manufacturing quality, repeatability and stability have 
been the focus of the Manufacturing Team over the past 
12 months. As a result of this and of process and 
materials development, overall cell yield has continued to 
improve to up to  80%.  This continuing focus on the 
manufacturing processes is an essential capability to 
enable the scale-up of successful volume manufacturing 
to meet our partners’ needs. 
Medium-term roadmap 
Following the restructure at the end of 2012 the Ceres 
Board agreed a medium-term roadmap to enable it to 
meet its strategic goals, as discussed below.   
Commercial  
The goal over the next five years is to target early stage 
commercial deals in addition to developing existing 
relationships, with the aim of translating these into major 
development programmes and license agreements with 
OEM partners.  Our unique technology will enable our 
customers and partners to be market leaders in low cost 
distributed power generation and will position the Group 
to set the global standard for fuel cells in our chosen 
markets.  These early stage commercial agreements are 
designed to enable partners to develop and trial products 
based on the Group’s core technology in micro-CHP and 
other markets.   
 
Ceres is targeting partners with the balance sheet 
strength and skills to develop product beyond the FCM 
module and who are able to fully integrate our 
technology into products. We also expect our partners to 
be market leaders in their domestic markets with 
significant international reach. The Group will take the 
opportunity to leverage developments beyond the FCM, 
which were completed under the old strategy, to 
accelerate the go-to-market time for new partners.  
 
The Group recognises the importance of its existing 
contracts, particularly those with British Gas in the UK and 
Itho-Daalderop in the Netherlands. Although Ceres’ initial 
OEM product partners are likely to launch product in their  8  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
own countries first, these existing contracts could be 
important beachheads into Europe for them and other 
potential partners.   
Manufacturing  
Our manufacturing capability and IP are valuable assets to 
the Ceres business.  The manufacturing capacity at our 
plant in Horsham is sufficient for our current needs.  In 
response to anticipated customer and internal demand, 
the business would expect 
to increase this 
manufacturing capacity 
four-fold on the same site 
over the next few years by 
increasing the number of 
shifts and with a limited 
targeted amount of capital 
expenditure, in response 
to customer and internal 
demand.   
 
In parallel with manufacturing cells and stacks and 
assembling FCMs in-house, we will continue to 
industrialise and stabilise the manufacturing processes 
with the current aim to invest in a larger scale pilot plant 
in time.  This will act as a blueprint to enable future 
partners to mass manufacture under license and will 
service anticipated initial higher volume demand.  The 
Group would not expect to make any significant financial 
commitments in this financial year and we will target a 
location where significant grants are available to 
contribute towards capital expenditure.  
Technology 
Ceres will continue to industrialise and make continual 
improvements to its core fuel cell and FCM technology.  
Improvements to the Ceres Technology Platform will be 
carefully targeted. The business is focused on developing 
1kW stacks and FCMs for natural gas, although, with the 
right level of partner funding, it could also be scaled and 
utilise alternative fuels for other applications.  The FCM 
developed to date and the deep in-house system 
expertise has great value and can accelerate our partners’ 
route to market. 
 
In addition to its core technology offering, the Group will 
offer its partners application services and micro-CHP 
product-related IP which we developed before the change 
of strategy, which will also accelerate take-up.   
Financial 
As a result of the restructuring and change in strategy in 
the year, recurring operating costs were reduced by 
£7.9m from £18.1m in 2012 to £10.2m in 2013.  Over the 
same period the Group’s average headcount fell from 155 
in 2012 to 76 and currently stands at approximately 65.   
 
During the year Calor Gas and Ceres agreed to end their 
agreement to develop and supply an LPG-fuelled product 
for sale in the UK market.  As a result £0.5m of deferred 
revenue, being the unamortised portion of up-front 
milestone payments relating to Calor Gas, was released to 
the Income Statement without any cash impact.  This was 
the primary reason the revenue for the year increased to 
£0.5m (2012: £0.2m).  Deferred income of £1.8m relating 
to the British Gas and Bord Gais Eireann development and 
supply contracts (2012: £1.8m) remains on the balance 
sheet.   
 
An income tax credit of £1.3m (2012: £3m) has been 
recorded in the year, consisting of a £1.0m estimated tax 
recovery in respect of the current financial year and an 
additional £0.3m received in respect of the prior year.   
 
The loss for the financial year attributable to shareholders 
reduced from £14.9m to £11.4m due to reduced 
expenditure.  The average number of shares in issue 
increased from 86.2m to 292.8m which was the 
significant contributor to the reduction in loss per 
ordinary share of 3.88p (2012: 17.28p).   
 
During the year the Group’s net cash used in operations 
reduced to £7.3m (2012: £15.4m) reflecting the reduced 
operating expenditure, a favourable working capital 
movement and the disposal of property, plant and 
machinery in the year.  Current equity-free cash burn is 
forecast to remain steady and be around £9m in the 
financial year ending 30 June 2014.    
People 
The great progress being made in the development of our 
technology is testament to the talent, robust 
entrepreneurial spirit and commitment of our employees.  
We are fortunate in having a united team which works 
collaboratively across the range of disciplines with 
knowledge, dedication and passion to deliver great results 
with every activity we undertake.  
 
We are committed to providing opportunities for our 
employees to succeed, encourage their innovative 
thinking and enhance their professional abilities through 
a range of development opportunities. 
I extend the Board’s sincere thanks to every one of our 
team for their personal and collective contribution, and 
its recognition and appreciation of the ongoing support 
they receive from their families as they help us pursue  Ceres Power Holdings plc Annual Report 2013   9 
 
 
 
 
 
our Group’s mission.  Our success is absolutely a team 
effort. 
Summary 
During the past 12 months Ceres has undertaken a 
significant change in direction with regard to its go-to-
market strategy, choosing core technology focus over 
product.  Product development is now part of the Group 
strategy only in conjunction with our OEM and system 
integration partners.  Commercially we have shown that 
we can attract and transact with world class product 
organisations and we shall continue to do so.  Technically 
we have continued to meet and in some cases exceed the 
standards set by ourselves in the core technology 
programmes at cell, stack and FCM.  We can demonstrate 
appropriate levels of efficiency, robustness and 
manufacturing quality in support of real-world product 
development programmes for mass market applications.  
The Group continues to receive validation by OEM 
partners and other third parties that the core technology 
is achieving its design goals which underline our belief in 
the cost leadership potential for this technology. I would 
like to thank my executive management team for the 
hard work, pragmatism and tenacity over the past year.  
Their leadership has anchored Ceres and put us in an 
extremely strong position for the future. 
 
 
 
 
 
Phil Caldwell  
Chief Executive 
30 September 2013 
 
   10  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Board of Directors 
 
Alan Aubrey – Chairman 
Alan joined the Company in December 2012 as Chairman. He is the CEO of IP Group plc, a 
leading UK intellectual property commercialisation company and major investor in Ceres 
Power. He is also Non-Executive Chairman of Proactis, an AIM-listed software company and a 
Non-Executive Director of the Department for Business, Innovation & Skills (BIS). Previously 
Alan was a partner in KPMG where he specialised in providing advice to fast growing 
technology businesses. He is a fellow of the Institute of Chartered Accountants of England and 
Wales. Alan holds a BA in Economics and a MBA. 
 
 
Phil Caldwell – Chief Executive Officer 
Phil joined the Company in September 2013 as CEO. He was previously Corporate Development 
Director at Intelligent Energy Limited, a company specialising in the development of PEM fuel 
cell systems, where he was responsible for leading commercial and strategic business 
development activities, including securing OEM partners, executing licence deals and 
development agreements in the Far East. Prior to joining Intelligent Energy, Phil was 
responsible for business development for electrochemical technology within ICI. He has a 
Masters degree in Chemical Engineering from Imperial College, London, holds an MBA and is a 
Chartered Engineer. 
 
 
Richard Preston – Finance Director 
Richard joined Ceres Power in 2008 as Financial Controller, performing key finance and 
programme manager roles across the business. He was appointed to the Board in February 
2013. Previously Richard held a number of senior roles in business transformation and project 
finance at Cable & Wireless. He is a Chartered Accountant and Corporate Treasurer and holds 
an MA in Engineering and Management Studies from the University of Cambridge.  
 
 
   Ceres Power Holdings plc Annual Report 2013   11 
 
 
 
 
 
 
 
 
Steve Callaghan – Non-Executive Director 
Steve joined Ceres Power in December 2012. He is a turnaround specialist in the technology 
sector. Before he joined the Company he was Executive Vice President at Torex Retail Holdings 
owned by Cerberus Private Equity and General Atlantic. Prior to Torex Steve was CEO of MMI 
Research Limited, the precision geo-location and cell phone intercept business, CEO of Framfab 
AB, Europe’s largest web design and technology consulting business and CEO of Card Clear plc. 
He served as an Army officer in the Brigade of Gurkhas and Royal Signals until 1989 and has a 
degree in Electrical Engineering. 
 
 
Mike Lloyd – Non-Executive Director 
Mike joined Ceres Power in July 2012. He has more than forty years of experience in 
engineering, manufacturing and supply chain roles in the electrical machinery and power 
sectors. His senior leadership roles have included Group Manufacturing Director, President of 
Rolls Royce Gas Turbines Operations, Technical Director of GEC Large Machines and Managing 
Director of Alstom Transport. Mike is currently Chairman of Magnomatics, a venture capital-
backed technology company, specialising in the development of innovative magnetic 
transmission drives for applications including wind turbines and hybrid vehicles. Mike is also a 
Non-Executive Director of the Office of Rail Regulation and an advisor to Unipart and Cobham 
plc. He has a BSc in Electrical Engineering, a PhD in Electrical Machines and is a Fellow of the 
Royal Academy of Engineering. 
 
 
Robert Trezona – Non-Executive Director 
Robert joined the Company in December 2012. He has been working in technology venture for 
many years, focusing on cleantech and materials opportunities. He is the cleantech lead at IP 
Group plc and provides sector expertise across IP Group’s portfolio as well as originating and 
managing investments in high-potential cleantech start-ups. Prior to this he was Head of 
Research and Development at the Carbon Trust, fuel cell team lead at Johnson Matthey and 
Ceres Power and strategy consultant for McKinsey and Company.  He holds a PhD in Materials 
Science from the University of Cambridge.  
 
   12  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Directors’ Report 
for the year ended 30 June 2013 
 
The Directors present their report and the audited 
financial statements for the year ended 30 June 2013. 
 
Principal activities 
During the year the Group restructured and changed its 
strategy from the development and commercial 
exploitation of microgeneration products based on the 
Group’s solid oxide fuel cell technology, to the 
development and commercialisation of its core fuel cell 
and fuel cell module technology. 
 
Review of business and future developments 
Significant developments and operating activities of the 
Group, as well as the future strategy, business 
environment and prospects for the Group are discussed in 
detail in the Chairman’s Statement and the Chief 
Executive Officer’s Review on pages 4 to 9. 
 
In addition to the Group’s priorities as set out in the Chief 
Executive Officer’s Review, the Group considers its Key 
Performance Indicators (“KPIs”) to be revenue and net 
cash and financial assets measured against 
predetermined targets. The Directors are very pleased 
with the progress made in delivering the Group’s key 
priorities since the restructuring in December 2012 when 
measured against their targets, as noted in the 
Chairman’s Statement and the Chief Executive Officer’s 
Review. 
 
Results and dividends 
The loss for the financial year was £11,375,000 (2012: 
£14,900,000). The net cash used in operating activities 
during the year was £7,349,000 (2012: £15,408,000). At 30 
June 2013 the Group had net cash and short-term 
investments of £15,437,000 (2012: £10,178,000). 
 
The Directors do not recommend the payment of a 
dividend (2012: £nil). 
 
Research and development 
During the year, the Group incurred expenditure of 
£7,200,000 (2012: £13,205,000) on research and 
development, all of which was written off to the 
Consolidated Statement of Comprehensive Income. The 
Chief Executive Officer’s Review reports on progress 
during the year. 
 
Charitable and political contributions 
The Group made no charitable or political contributions 
during the year (2012: £nil). 
 
Principal risks and uncertainties 
In addition to financial risk management which is detailed 
in note 14 to the financial statements, there are a number 
of risks and uncertainties which could have a material 
impact on the execution of the Group’s strategy. Risks are 
formally reviewed by the Board and appropriate 
processes and controls put in place to monitor and 
mitigate them. Key business risks are set out as follows: 
 
Future funding risk 
The future funding needs of the business are noted on 
page 5 of the Chairman’s Statement. 
 
Competitive and market risk 
Future revenues are dependent on the development of 
markets, the impact on these markets of alternative 
technologies from competitors, technology obsolescence, 
fuel prices, feed-in tariffs and changing regulations. 
 
Technology risk 
Uncertainty still exists regarding the successful 
development and application of the Company’s fuel cell 
and fuel cell module technology to potential products. 
 
Intellectual Property protection risk 
The Group continues to invest in the expansion and 
protection of its portfolio of intellectual property. The 
Group’s competitive advantage is at risk of unauthorised 
parties using the Group’s technology in their own 
products. Internal procedures and controls are therefore 
in place to capture all Intellectual Property (‘IP’) and then 
to prevent or control disclosure to third parties and 
partners. There is always a degree of uncertainty over the 
ability to register certain IP rights. IP insurance provides 
additional protection for agreement, pursuit and defence 
of IP terms and rights. 
 
Key personnel dependence risk 
The Directors have put in place short-term incentive 
schemes for key personnel and granted share options to 
all employees during the year. These support the existing 
competitive remuneration packages and restrictive 
employment covenants already in place. These are aimed 
at reducing the risk of disruption to operations and 
damage to the business due to key personnel leaving the 
business. 
 
Global economic risk 
Although there have been improvements in the global 
economy since 2010, there is continued uncertainty 
around the restructuring of European sovereign debt, 
which could adversely impact the global economy. The 
Group is at risk to increased cost and delays through 
exposure to the default of suppliers if economic 
conditions do not continue to improve. The Directors 
continue to closely monitor this risk. 
 
 
   Ceres Power Holdings plc Annual Report 2013   13 
 
 
 
 
 
Directors 
The Directors of the Company, who served during the 
year and up to the date of signing the financial 
statements unless otherwise stated, are as follows: 
 
Alan Aubrey (Non-Executive Chairman) appointed 18 December 2012 
Philip Caldwell (Chief Executive Officer) appointed 2 September 2013 
Richard Preston (Finance Director) appointed 14 February 2013 
Steve Callaghan (Non-Executive Director) appointed 18 December 2012 
Mike Bretherton (Non-Executive Director) appointed 18 December 2012 
– retiring 4 October 2013 
Mike Lloyd (Non-Executive Director) appointed 3 July 2012 
Robert Trezona (Non-Executive Director) appointed 18 December 2012 
Dr Brian Count (Non-Executive Chairman) resigned 18 December 2012 
David Pummell (Chief Executive Officer) resigned 18 December 2012 
Rex Vevers (Finance Director) resigned 14 February 2013 
Dr Phil Whalen (Technology Director) resigned 14 February 2013 
John Nicholas (Non-Executive Director) resigned 18 December 2012 
 
Substantial shareholders 
The Company has been notified of the following holdings 
of 3% or more of the 536,831,973 ordinary shares of 1p 
each of the Company on 27 September 2013: 
 
Investor 
Number of 
ordinary shares Percentage   
ORA (Guernsey) Limited 151,353,358 28.21% 
IP Group plc 132,500,000 24.69% 
Sarasin & Partners LLP 34,929,061 6.51% 
Henderson Global Investors 33,825,000 6.30% 
Ali Mortazavi 25,000,000 4.66% 
 
Policy and practice on payment of creditors 
It is the Group’s policy, for all suppliers, to agree payment 
terms in advance of the supply of goods and services and 
to adhere to those payment terms. Trade creditors of the 
Group at the year end as a proportion of amounts 
invoiced by suppliers during the year represent 38 days 
(2012: 45 days). Trade creditors of the Company at the 
year end as a proportion of amounts invoiced by suppliers 
during the year represent 17 days (2012: 12 days). 
 
Corporate Governance 
The Directors recognise the importance of good 
corporate governance.  The principles of how the UK 
Corporate Governance Code has been applied are in the 
Corporate Governance section of the Company’s website 
(www.cerespower.com), which was last updated on 30 
September 2013. 
 
Statement of Directors’ responsibilities 
The Directors are responsible for preparing the Annual 
Report and the financial statements in accordance with 
applicable law and regulations. 
 
Company law requires the Directors to prepare financial 
statements for each financial year. Under that law the 
Directors have prepared the Group financial statements 
in accordance with International Financial Reporting 
Standards (“IFRSs”) as adopted by the European Union, 
and the parent Company financial statements in 
accordance with United Kingdom Generally Accepted 
Accounting Practice (United Kingdom Accounting 
Standards and applicable law). 
 
Under Company law the Directors must not approve the 
financial statements unless they are satisfied that they 
give a true and fair view of the state of affairs of the 
Group and the Company and of the profit or loss of the 
Group for that period. In preparing these financial 
statements, the Directors are required to: 
 
 select suitable accounting policies and then apply 
them consistently; 
 make judgements and accounting estimates that are 
reasonable and prudent; 
 state whether IFRSs as adopted by the European 
Union and applicable UK Accounting Standards have 
been followed, subject to any material departures 
disclosed and explained in the Group and parent 
Company financial statements respectively; and 
 prepare the financial statements on the going 
concern basis unless it is inappropriate to presume 
that the Company will continue in business. 
 
The Directors are responsible for keeping adequate 
accounting records that are sufficient to show and explain 
the Company’s transactions and disclose with reasonable 
accuracy at any time the financial position of the 
Company and the Group and enable them to ensure that 
the financial statements comply with the Companies Act 
2006. They are also responsible for safeguarding the 
assets of the Company and the Group and hence for 
taking reasonable steps for the prevention and detection 
of fraud and other irregularities. 
 
The Directors are responsible for the maintenance and 
integrity of the Company’s website. Legislation in the 
United Kingdom governing the preparation and 
dissemination of financial statements may differ from 
legislation in other jurisdictions. 
 
Going concern 
After having made appropriate enquiries, the Directors 
have a reasonable expectation that the Group and 
Company have adequate resources to progress their 
established strategy for the foreseeable future. 
Accordingly, they continue to adopt the going concern 
basis in preparing these financial statements. 
 
Directors’ statement on disclosure of information to 
auditors 
So far as each Director is aware, there is no relevant audit 
information of which the Company’s auditors are 
unaware. Each Director has taken all the steps that he 
ought to have taken as a Director in order to make 
himself aware of any relevant audit information and to 
establish that the Company’s auditors are aware of that 
information. 
 
  14  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
 
Independent auditors 
The auditors, PricewaterhouseCoopers LLP, have 
indicated their willingness to continue in office and a 
resolution concerning their reappointment will be 
proposed at the Annual General Meeting. 
 
By order of the Board 
 
Richard Preston 
Finance Director 
30 September 2013 
  Ceres Power Holdings plc Annual Report 2013   15 
 
 
 
 
 
Independent Auditors’ Report  
to the Members of Ceres Power Holdings plc 
 
 
We have audited the Group financial statements of Ceres 
Power Holdings plc for the year ended 30 June 2013 
which comprise the Consolidated Statement of 
Comprehensive Income, the Consolidated Balance Sheet, 
the Consolidated Cash Flow Statement, the Consolidated 
Statement of Changes in Equity and the related notes. 
The financial reporting framework that has been applied 
in their preparation is applicable law and International 
Financial Reporting Standards (‘IFRSs’) as adopted by the 
European Union. 
 
Respective responsibilities of Directors and auditors 
As explained more fully in the Statement of Directors’ 
responsibilities set out on page 13 the Directors are 
responsible for the preparation of the Group financial 
statements and for being satisfied that they give a true 
and fair view. Our responsibility is to audit and express an 
opinion on the Group financial statements in accordance 
with applicable law and International Standards on 
Auditing (UK and Ireland). Those standards require us to 
comply with the Auditing Practices Board’s Ethical 
Standards for Auditors. 
 
This report, including the opinions, has been prepared for 
and only for the Company’s members as a body in 
accordance with Chapter 3 of Part 16 of the Companies 
Act 2006 and for no other purpose. We do not, in giving 
these opinions, accept or assume responsibility for any 
other purpose or to any other person to whom this report 
is shown or into whose hands it may come save where 
expressly agreed by our prior consent in writing. 
 
Scope of the audit of the financial statements 
An audit involves obtaining evidence about the amounts 
and disclosures in the financial statements sufficient to 
give reasonable assurance that the financial statements 
are free from material misstatement, whether caused by 
fraud or error. This includes an assessment of: whether 
the accounting policies are appropriate to the Group’s 
circumstances and have been consistently applied and 
adequately disclosed; the reasonableness of significant 
accounting estimates made by the Directors; and the 
overall presentation of the financial statements. In 
addition, we read all the financial and non-financial 
information in the Annual Report to identify material 
inconsistencies with the audited financial statements. If 
we become aware of any apparent material 
misstatements or inconsistencies we consider the 
implications for our report.  
 
Opinion on financial statements 
In our opinion the Group financial statements: 
 
 give a true and fair view of the state of the Group’s 
affairs as at 30 June 2013 and of its loss and cash 
flows for the year then ended; 
 have been properly prepared in accordance with 
IFRSs as adopted by the European Union; and 
 have been prepared in accordance with the 
requirements of the Companies Act 2006. 
 
 
Opinion on other matter prescribed by the Companies 
Act 2006 
In our opinion the information given in the Directors’ 
Report for the financial year for which the Group financial 
statements are prepared is consistent with the Group 
financial statements. 
 
Matters on which we are required to report by 
exception 
We have nothing to report in respect of the following 
matters where the Companies Act 2006 requires us to 
report to you if, in our opinion: 
 
 certain disclosures of Directors’ remuneration 
specified by law are not made; or 
 we have not received all the information and 
explanations we require for our audit. 
 
Other matter 
We have reported separately on the parent Company 
financial statements of Ceres Power Holdings plc for the 
year ended 30 June 2013. 
 
Rosemary Shapland  
(Senior Statutory Auditor) 
for and on behalf of PricewaterhouseCoopers LLP 
Chartered Accountants and Statutory Auditors 
Gatwick 
30 September 2013 
 
 
  16  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Consolidated Statement of Comprehensive Income  
for the year ended 30 June 2013 
 
 
Note 
2013  
£’000 
2012  
£’000 
Revenue 2 523 226 
Operating costs 3 (13,265) (18,480) 
Other operating income 3 1 182 
Operating loss  (12,741) (18,072) 
Finance Income 4 55 165 
Loss before income tax 3 (12,686) (17,907) 
Income tax credit 7 1,311 3,007 
Loss for the financial year and total comprehensive loss  (11,375) (14,900) 
Loss per £0.01 ordinary share expressed in pence per share:    
– basic and diluted 8 (3.88)p (17.28)p 
 
The notes on pages 20 to 37 are an integral part of these consolidated financial statements. 
 
   Ceres Power Holdings plc Annual Report 2013   17 
 
 
 
 
 
Consolidated Balance Sheet 
as at 30 June 2013 
 
 
Note 
2013  
£’000 
2012  
£’000 
Assets    
Non-current assets    
Property, plant and equipment 9 2,181 4,216 
Other receivables 11 53 81 
Total non-current assets  2,234 4,297 
    
Current assets    
Trade and other receivables 11 454 583 
Derivative financial instruments 14 – 7 
Current tax receivable  1,044 2,400 
Short-term investments 12 6,207 – 
Cash and cash equivalents 12 9,230 10,178 
Total current assets  16,935 13,168 
    
Liabilities    
Current liabilities    
Trade and other payables 13 (1,350) (1,768) 
Total current liabilities  (1,350) (1,768) 
Net current assets  15,585 11,400 
    
Non-current liabilities    
Accruals and deferred income 13 (1,918) (2,354) 
Provisions for other liabilities and charges 15 (1,293) (365) 
Total non-current liabilities  (3,211) (2,719) 
Net assets  14,608 12,978 
    
Equity    
Share capital 16 8,817 4,311 
Share premium account  72,906 64,821 
Other reserve  7,463 7,463 
Profit and loss account (deficit)  (74,578) (63,617) 
Total equity  14,608 12,978 
 
The notes on pages 20 to 37 are an integral part of these consolidated financial statements. 
 
The financial statements on pages 16 to 37 were approved by the Board of Directors on 30 September 2013 and were signed on its 
behalf by: 
 
Philip Caldwell  Richard Preston 
Chief Executive Officer  Finance Director 
 
Ceres Power Holdings plc 
Registered Number: 5174075 
 
 
 
   18  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Consolidated Cash Flow Statement 
for the year ended 30 June 2013 
 
 
Note 
2013  
£’000 
2012  
£’000 
Cash flows from operating activities    
Cash used in operations 18 (10,016) (17,515) 
Income tax received  2,667 2,107 
Net cash used in operating activities  (7,349) (15,408) 
    
Cash flows from investing activities    
Purchase of property, plant and equipment  (42) (1,335) 
Movement in short-term investments  (6,207) 8,000 
Finance income received  57 238 
Net cash (used in)/generated from investing activities  (6,192) 6,903 
    
Cash flows from financing activities    
Proceeds from issuance of ordinary shares  12,591 2 
Net cash generated from financing activities  12,591 2 
Net decrease in cash and cash equivalents  (950) (8,503) 
Exchange gains/(losses) on cash and cash equivalents  2 (6) 
  (948) (8,509) 
Cash and cash equivalents at beginning of year  10,178 18,687 
Cash and cash equivalents at end of year 12 9,230 10,178 
    
 
 
   Ceres Power Holdings plc Annual Report 2013   19 
 
 
 
 
 
Consolidated Statement of Changes in Equity 
for the year ended 30 June 2013 
 
 
 
 
 
Note 
Share 
capital 
£’000 
Share premium 
account  
£’000 
Other  
reserve 
 £’000 
Profit  
and loss 
account  
 £’000 
Total 
£’000 
At 1 July 2011  4,309 64,821 7,463 (49,185) 27,408 
       
Comprehensive income       
Loss for the financial year  – – – (14,900) (14,900) 
Total comprehensive loss  – – – (14,900) (14,900) 
       
Transactions with owners       
Issue of shares, net of costs 16 2 _ _ _ 2 
Share-based payments charge  – – – 468 468 
Total transactions with owners  2 – – 468 470 
At 30 June 2012  4,311 64,821 7,463 (63,617) 12,978 
       
Comprehensive income       
Loss for the financial year  – – – (11,375) (11,375) 
Total comprehensive loss  – – – (11,375) (11,375) 
       
Transactions with owners       
Issue of shares, net of costs 16 4,506 8,085                  – – 12,591 
Share-based payments charge  – – – 414 414 
Total transactions with owners  4,506 8,085 – 414 13,005 
At 30 June 2013  8,817 72,906 7,463 (74,578) 14,608 
       
 
  20  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Notes to the Consolidated Financial Statements 
for the year ended 30 June 2013 
 
 
1. Summary of significant accounting policies 
The Company is incorporated and domiciled in the United 
Kingdom and is registered on the AIM market of the 
London Stock Exchange.  
 
The principal accounting policies applied in the 
preparation of these consolidated financial statements 
are set out below. These policies have been consistently 
applied to all the years presented, unless otherwise 
stated. 
 
Basis of preparation 
The consolidated financial statements of the Group have 
been prepared in accordance with International Financial 
Reporting Standards (“IFRS”) as adopted by the European 
Union, the IFRS Interpretations Committee (“IFRS-IC”) 
interpretations and those parts of the Companies Act 
2006 applicable to companies reporting under IFRS.  
 
The Company has elected to prepare its entity financial 
statements in accordance with United Kingdom Generally 
Accepted Accounting Practice (‘UK GAAP’) and these are 
presented on pages 39 to 43. 
 
The consolidated financial statements have been 
prepared on a historical cost basis except for certain 
items that have been measured at fair value as detailed in 
the individual accounting policies below.  
 
Critical accounting estimates and judgements 
The preparation of financial statements in conformity 
with IFRS requires management to make judgements, 
estimates and assumptions that affect the reported 
amounts of assets and liabilities at the date of the 
financial statements and the reported amounts of 
revenues and expenses during the reporting period. 
Although these estimates are based on management’s 
best knowledge of the amount, event or actions, actual 
results may ultimately differ from these estimates. 
 
The estimates and underlying assumptions are reviewed 
on an ongoing basis. Revisions to accounting estimates 
are recognised in the period in which the estimate is 
revised. Material estimates and assumptions are made in 
particular with regard to: providing for onerous leases; 
choosing the appropriate method with which to recognise 
development-related revenue (revenue is recognised over 
the development phase of each contract based on the 
costs incurred (‘percentage of completion’)); and 
recognising R&D tax credits.  
 
Basis of consolidation 
The consolidated financial statements of Ceres Power 
Holdings plc include the results of the Company and its 
wholly owned subsidiaries. Subsidiaries are entities over 
which the Group has the power to govern the financial 
and operating policies of the subsidiary. Subsidiaries are 
consolidated from the date on which control is 
transferred to the Group and are de-consolidated from 
the date that control ceases. The purchase method of 
accounting is used to account for acquisitions and the 
cost of acquisition is measured as the fair value of assets 
given, equity instruments issued and liabilities incurred. 
The accounting policies of subsidiaries have been changed 
where necessary to ensure consistency with the policies 
adopted by the Group. 
 
The financial statements of Ceres Power Limited have 
been consolidated under merger accounting rules. The 
financial statements of Ceres Intellectual Property 
Company Limited have been consolidated under 
acquisition accounting rules.  
 
Intra-Group transactions, profits, losses and balances are 
eliminated in full on consolidation. 
 
Capital risk management 
The Group’s objectives, when managing capital, are to 
safeguard the Group’s ability to continue as a going 
concern and to maintain an optimal capital structure. 
Total capital, which is the Group’s primary source of 
funding, is calculated as ‘Total equity’ as shown in the 
consolidated balance sheet. The Group protects its capital 
by eliminating/hedging treasury risks that could expose 
the Group to the risk of material loss of capital (refer to 
note 14). 
 
Property, plant and equipment 
Property, plant and equipment are stated at historical 
cost less depreciation. Historical cost includes all 
expenditure that is directly attributable to the acquisition 
of the assets. Subsequent costs are included in the asset’s 
carrying amount or recognised as a separate asset, as 
appropriate, only when it is probable that future 
economic benefits associated with the asset will flow to 
the Group and the cost of the asset can be measured 
reliably. All other repairs and maintenance costs are 
charged to the Consolidated Statement of Comprehensive 
Income during the financial period in which they are 
incurred. 
 
   Ceres Power Holdings plc Annual Report 2013   21 
 
 
 
 
 
Depreciation is calculated using the straight-line method 
to allocate the cost over the estimated useful lives as 
follows: 
 
Leasehold improvements Ten years or the lease term if shorter  
Plant and machinery  Three to five years  
Computer equipment  Three years  
Fixtures and fittings  Three to ten years 
 
The assets’ residual values and useful lives are reviewed, 
and adjusted if appropriate, at each balance sheet date.  
Assets under construction represent the cost of 
purchasing, constructing and installing property, plant 
and equipment ahead of their productive use. The 
category is temporary, pending completion of the assets 
and their transfer to the appropriate and permanent 
category of property, plant and equipment. As such, no 
depreciation is charged on assets under construction. 
 
Cash and cash equivalents 
Cash and cash equivalents includes cash at bank and in 
hand, pooled money market funds and short-term 
deposits with an original maturity of less than or equal to 
three months, reduced by overdrafts to the extent that 
there is a right of offset against other cash balances.  
 
Short-term investments 
These include short-term bank deposits with original 
maturity greater than three months and less than or 
equal to 12 months. 
 
Trade and other receivables 
Trade receivables are recognised initially at fair value and 
subsequently held at amortised cost less an allowance for 
any uncollectable amounts that are made when the full 
amount is no longer considered receivable. Actual bad 
debts are written off when identified. A provision for 
impairment of trade receivables is established when there 
is objective evidence that the Group will not be able to 
collect all amounts due according to the original terms of 
the receivables. 
 
Trade payables 
Trade payables are recognised initially at fair value and 
subsequently measured at amortised cost using the 
effective interest method. 
 
Taxation 
The tax credit represents the best estimate of tax due to 
the Group at the year end. 
 
Deferred tax is provided in full, using the liability method, 
on temporary differences between the tax bases of assets 
and liabilities and their carrying amounts in the 
consolidated financial statements. Deferred tax assets are 
recognised to the extent that it is probable that future 
taxable profit will be available against which the 
temporary differences can be utilised. 
 
Share-based payments 
The Group has a number of employee and executive 
share option and incentive schemes under which it makes 
equity-settled share-based payments. The fair value at 
the date of grant of equity-settled, share-based payments 
is expensed on a straight-line basis over the vesting 
period, based on the Group’s estimate of shares that will 
eventually vest. The charge is then credited back to 
reserves. 
 
Fair value is measured by use of the Black-Scholes and 
binomial models. The expected lives used in the models 
have been adjusted, based on the Directors’ best 
estimates, for the effects of non-transferability, exercise 
restrictions and behavioural considerations. 
 
Foreign currencies 
The consolidated financial statements are presented in 
pounds sterling, which is the Company’s functional and 
presentational currency. Transactions denominated in 
foreign currencies are translated into sterling at the 
actual rate of exchange ruling at the date of the 
transaction. Monetary assets and liabilities denominated 
in foreign currencies are translated into sterling at rates 
ruling at the balance sheet date. Exchange differences are 
included in the Consolidated Statement of Comprehensive 
Income. 
 
Pension scheme arrangements 
The Group operates a defined contribution pension 
scheme for employees. The assets of the scheme are held 
separately from those of the Group. The pension costs 
charged represent contributions paid by the Group to 
individual pension plans and are charged to the 
Consolidated Statement of Comprehensive Income as 
they become payable. 
 
In addition, a stakeholder pension scheme is also 
available to employees. 
 
Revenue recognition 
Revenue comprises the fair value of the consideration 
received or receivable for the sale of goods and services in 
the ordinary course of the Group’s activities. Revenue is 
shown net of value added tax, other sales taxes and after 
eliminating sales within the Group. Amounts received or 
receivable under development contracts are recognised 
as revenue when earned, as calculated on a percentage of 
completion basis, based on costs incurred to total 
estimated costs over the period that the related work is 
performed, subject to certainty of receipt of cash, or when 
any specific conditions in agreements have been met. All 
costs relating to these development contracts are 
recorded as research and development expenditure. As 
revenue represents contributions towards costs incurred, 
no amounts have been allocated to cost of sales. 
   22  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Government grants 
Grants are recognised on a case-by-case basis. Revenue 
grants are recognised in the Consolidated Statement of 
Comprehensive Income as other operating income. 
Capital grants are recognised in property, plant and 
equipment against the assets to which they relate (and 
are fully disclosed in note 9 to the financial statements) 
and are credited to the Consolidated Statement of 
Comprehensive Income on a straight-line basis over the 
expected lives of the related assets as a reduced 
depreciation expense. For grants with no technical 
milestones, and where recovery is assured, the grant is 
recognised on an accruals basis in order to match the 
associated expenditure with the grant. For grants with 
technical milestones, grants are recognised only when the 
relevant milestone has been achieved and the associated 
cash has been received. 
 
Research and development expenditure 
Research costs are expensed as incurred. Development 
expenditure is capitalised when it can be separately 
measured and its future recoverability can be reasonably 
regarded as assured. Following initial recognition, the 
related asset is amortised over the period of expected 
future sales with impairment reviews being carried out at 
least annually. The asset is carried at cost less any 
accumulated amortisation and impairment losses.  
 
The Group has not yet capitalised any development costs 
as the criteria set out in IAS 38, ‘Intangible assets’, have 
not been met. 
 
Operating leases 
Leases in which a significant portion of the risks and 
rewards of ownership are retained by the lessor are 
classified as operating leases. Payments made under 
operating leases (net of any incentives received from the 
lessor) are charged to the Consolidated Statement of 
Comprehensive Income on a straight-line basis over the 
period of the lease. Benefits received and receivable as an 
incentive to sign an operating lease are amortised over the 
full lease term. 
 
Derivative financial instruments 
The Group’s activities expose it primarily to the financial 
risks of changes in foreign currency exchange rates. The 
Group uses forward foreign exchange contracts to hedge 
against foreign currency denominated purchase 
commitments. The use of financial derivatives is governed 
by the Group’s treasury policy, as approved by the Board. 
The Group does not use derivative financial instruments 
for speculative purposes. Details of financial instruments 
are shown in note 14. 
 
Changes in the fair value of derivative financial 
instruments that do not qualify for hedge accounting are 
recognised in the Consolidated Statement of 
Comprehensive Income as they arise. 
 
Provisions 
Provisions have been made for future dilapidations costs 
on leased property and on onerous leases. These 
provisions are the Directors’ best estimates as the actual 
costs and timing of future cash flows are dependent on 
future events. Any difference between expectations and 
the actual future liability will be accounted for in the 
period when such determination is made. Details of the 
Group’s provisions are set out in note 15. 
 
Changes in accounting policy and disclosures  
(a) New and amended standards adopted by the Group:  
The following IFRSs or IFRIC interpretations that are 
effective for the first time for the financial year beginning 
on or after 1 July 2013 that would be expected to have a 
material impact on the Group are set out below:  
 
IFRS 13, ‘Fair value measurement’, aims to improve 
consistency and reduce complexity by providing a precise 
definition of fair value and a single source of fair value 
measurement and disclosure requirements for use across 
IFRSs. The requirements, which are largely aligned 
between IFRSs and US GAAP, do not extend the use of fair 
value accounting but provide guidance on how it should 
be applied where its use is already required or permitted 
by other standards within IFRSs or US GAAP.  
 
(b) New standards and interpretations not yet adopted:  
A number of new standards and amendments to 
standards and interpretations are effective for annual 
periods beginning after 1 July 2013, and have not been 
applied in preparing these consolidated financial 
statements. None of these is expected to have a 
significant effect on the consolidated financial statements 
of the Group, except the following set out below:  
 
IFRS 9, ‘Financial instruments’, addresses the 
classification, measurement and recognition of financial 
assets and financial liabilities. IFRS 9 was issued in 
November 2009 and October 2010. It replaces the parts of 
IAS 39 that relate to the classification and measurement 
of financial instruments. IFRS 9 requires financial assets to 
be classified into two measurement categories: those 
measured as at fair value and those measured at 
amortised cost. The determination is made at initial 
recognition. The classification depends on the entity’s 
business model for managing its financial instruments and 
the contractual cash flow characteristics of the 
instrument. For financial liabilities, the standard retains 
most of the IAS 39 requirements. The main change is that, 
in cases where the fair value option is taken for financial 
liabilities, the part of a fair value change due to an entity’s 
own credit risk is recorded in other comprehensive income 
rather than the income statement, unless this creates an 
accounting mismatch. The group is yet to assess IFRS 9’s 
full impact and intends to adopt IFRS 9 no later than the 
accounting period beginning on or after 1 January 2015, 
subject to endorsement by the EU. The group will also 
consider the impact of the remaining phases of IFRS 9  Ceres Power Holdings plc Annual Report 2013   23 
 
 
 
 
 
when completed by the Board. 
 
 
2. Revenue and segmental information  
For management purposes, the Group is organised into 
one operating segment, which is the development and 
commercialisation of its core fuel cell and fuel cell module 
technology.  
 
The Group has adopted IFRS 8, ‘Operating Segments’. 
IFRS 8 defines operating segments as those activities of 
an entity about which separate financial information is 
available and which are evaluated by the Chief Operating 
Decision Maker to assess performance and determine the 
allocation of resources. The Chief Operating Decision 
Maker has been identified as the Chief Executive Officer, 
the Finance Director, and the Director of Technology. The 
Directors are of the opinion that under IFRS 8 the Group 
has only one operating segment, being the development 
and commercialisation of its core fuel cell and fuel cell 
module technology. The Chief Executive Officer, the 
Finance Director, and the Director of Technology assess 
the performance of the operating segment on financial 
information which is measured and presented in a manner 
consistent with that in the financial statements. 
 
The Group’s revenue of £523,000 (2012: £226,000) was 
derived from one customer in the United Kingdom 
(£510,000) and one customer in Asia (£13,000) (2012: one 
customer in the United Kingdom). All of the Group’s non-
current assets are located in the United Kingdom. 
 
  24  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
3. Loss before income tax  
 
2013 
£’000 
2012 
£’000 
Operating costs are split as follows:   
Research and development costs 7,200 13,205 
Administrative expenses - recurring 2,997 4,888 
 10,197 18,093 
Administrative expenses – non-recurring restructuring related 3,068 387 
 13,265 18,480 
   
Loss before income tax is stated after charging/(crediting):   
Staff costs, including share-based payments charges (note 5) 5,886 8,999 
Depreciation on property, plant and equipment (net of amortised grant contributions) 1,322 1,560 
Restructuring – disposal of property, plant and equipment (net) 759 – 
Restructuring – termination payments and provisions for onerous leases 2,309 387 
Operating lease rentals payable – property, plant and machinery 466 456 
Other operating income – grant income (1) (182) 
Repairs expenditure on property, plant and equipment 88 226 
Forward contract losses 7 22 
Net foreign exchange (gains)/losses (2) 6 
 
Services provided by the Group’s auditor   
During the year the Group obtained the following services from the Group’s auditor as detailed below:   
Fees payable to the Company’s auditor for the audit of parent Company and consolidated financial 
statements 16 24 
Fees payable to the Company’s auditor for other services   
– the audit of the Company’s subsidiaries  33 30 
– other services pursuant to legislation – 4 
– other services relating to taxation 27 36 
 76 94 
   
 
4. Finance income 
 
2013 
£’000 
2012 
£’000 
Interest receivable on net cash and short-term investments 55 165 
   
 
 
5. Employees and Directors 
The average monthly number of persons (including Executive Directors) employed by the Group during the year was: 
 
 
2013 
Number 
2012 
Number 
By activity:   
Research and development 59 122 
Administration 17 33 
 76 155 
 
   Ceres Power Holdings plc Annual Report 2013   25 
 
 
 
 
 
 
 
2013 
£’000 
2012 
£’000 
Staff costs (for the above persons) comprised:   
Wages and salaries, including compensation for loss of office 4,690 7,293 
Social security costs 532 838 
Other pension costs (note 6) 250 400 
Share-based payments (note 17) 414 468 
 5,886 8,999 
   
 
2013 
£’000 
2012 
£’000 
Directors’ emoluments:   
Aggregate emoluments 568 756 
Company contributions to defined contribution pension schemes 20 27 
Compensation for loss of office 475 – 
 1,063 783 
   
 
2013 
£’000 
2012 
£’000 
Highest paid Director:   
Aggregate emoluments 116 206 
Compensation for loss of office 253 – 
 369 206 
   
One Director (2012: two Directors) have retirement benefits accruing under defined contribution pension schemes. 
 
   26  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Directors’ emoluments for the year ended 30 June 2013 
  
 
Salary/fee 
£ 
Pension
1 
£ 
Termination 
Payment 
£ 
Total 
£ 
Executive     
Richard Preston
3
 40,250 3,220 – 43,470 
Rex Vevers
4
 106,469 8,517 111,938 226,924 
Dr Phil Whalen
4
 106,469 8,517 109,913 224,899 
David Pummell
5
 115,705 – 253,366 369,071 
     
Non-Executive     
Alan Aubrey
6
 7,962 – – 7,962 
Steve Callaghan
2
 77,112 – – 77,112 
Mike Bretherton
6
 7,962 – – 7,962 
Robert Trezona
9
 7,962 – – 7,962 
Mike Lloyd
7
 28,615 – – 28,615 
Dr Brian Count
5
 45,897 – – 45,897 
John Nicholas
5
 23,443 – – 23,443 
 567,846 20,254 475,217 1,063,317 
 
 
Directors’ emoluments for the year ended 30 June 2012 
 
Salary/fee 
£ 
Pension
1
 
£ 
Total 
£ 
Executive    
David Pummell
 
206,371 – 206,371 
Rex Vevers 170,350 13,628 183,978 
Dr Phil Whalen 170,350 13,628 183,978 
    
Non-Executive    
Dr Brian Count 100,000 – 100,000 
Sir David Brown
8
 33,333 – 33,333 
John Nicholas 45,000 – 45,000 
Alan Wood
8
 30,000 – 30,000 
 
755,404 27,256 782,660 
 
1 Pension contribution is based on 8% of gross salary and employer’s National Insurance saved on employee pension contributions.  
2 Steve Callaghan was appointed to the Board on 18 December 2012. Fees totalling £69,375 (2012: £nil) were paid to Steve Callaghan Services Limited, a company of which Steve 
Callaghan is a Director. 
3 Appointed to the Board on 14 February 2013.  
4 Resigned on 14 February 2013.  
5 Resigned on 18 December 2012. 
6   Appointed to the Board on 18 December 2012. 
7   Appointed to the Board on 3 July 2012. 
8   Resigned on 29 February 2012. 
9  Appointed to the Board on 18 December 2012.  His fees are paid to IP Group Ltd. 
 
 
   Ceres Power Holdings plc Annual Report 2013   27 
 
 
 
 
 
Directors’ interests in share options 
 
 
At 1 July 
 2012 
 number 
Granted 
number Exercised 
Lapsed/ 
Surrendered  
number 
At 30 June 2013 
number
5
 Exercise price 
Exercise  
period 
Steve Callaghan        
Options (unapproved) – 2,000,000 (2,000,000) – – £0.01  
Options (unapproved) – 1,500,000 – – 1,500,000 £0.099 April 2016–April 2023 
 – 3,500,000 
 
(2,000,000) – 1,500,000   
        
Richard Preston        
Options (approved) 65,000 – – (65,000) – £1.65  
Sharesave Options (approved) 5,648 – – (5,648) – £0.81  
Sharesave Options (approved) 11,281 – – (11,281) – £0.40  
Options (unapproved)
 4
 44,035 – (44,035) – – £0.05  
Options (approved) – 400,000 – – 400,000 £0.01 January 2016–January 2023 
Options (approved) – 400,000 – – 400,000 £0.01 January 2017–January 2023 
Options (approved) – 400,000 – – 400,000 £0.01 January 2018–January 2023 
Options (approved) – 400,000 – – 400,000 £0.01 January 2019–January 2023 
Options (unapproved) – 375,000 – – 375,000 £0.099 April 2016–April 2023 
Options (unapproved) – 375,000 – – 375,000 £0.099 April 2017–April 2023 
Options (unapproved) – 375,000 – – 375,000 £0.099 April 2018–April 2023 
Options (unapproved) – 375,000 – – 375,000 £0.099 April 2019–April 2023 
 125,964 3,100,000 (44,035) (81,929) 3,100,000   
        
Rex Vevers        
Options (approved) 46,510 – – – 46,510 £2.15  September 2006–September 2016 
Options (unapproved) 228,490 – – – 228,490 £2.15 September 2006–September 2016 
Options (unapproved)
1
 159,375 – – – 159,375 £2.00 December 2010–December 2018 
Options (unapproved)
2
 239,063 – – – 239,063 £2.00 December 2011–December 2018 
Options (unapproved)
3
 239,062 – – – 239,062 £2.00 December 2012–December 2018 
Sharesave options (approved) 5,648 – – (5,648) – £0.81  
Options (unapproved)
4
 23,518 – – (23,518) – £0.05  
Sharesave options (approved) 11,281 – – (11,281) – £0.40 July 2014–December 2014 
 952,947 – – (40,447) 912,500   
   
 
    
Dr Phil Whalen        
Options (unapproved)
1
 53,125 – – – 53,125 £2.00 September 2011–August 2019 
Options (unapproved)
2
 79,688 – – – 79,688 £2.00 September 2012–August 2019 
Options (unapproved)
3
 79,687 – – – 79,687 £2.00 September 2013–August 2019 
Sharesave options (approved) 11,281 – – (11,281) – £0.40  
 223,781 – – (11,281) 212,500   
        
Mike Lloyd        
Options (unapproved) – 750,000 – – 750,000 £0.01 December 2015–December 2022 
Options (unapproved) – 170,000 – – 170,000 £0.099 April 2016–April 2023 
 – 920,000 – – 920,000   
 
1 One-off options, exercisable if the share price is greater than or equal to £4 over 20 consecutive trading days at some point in the exercise period.  
2 One-off options, exercisable if the share price is greater than or equal to £5 over 20 consecutive trading days at some point in the exercise period.  
3 One-off options, exercisable if the share price is greater than or equal to £6 over 20 consecutive trading days at some point in the exercise period.  
4 CHP Project Bonus Plan deferred share options.  
5 Or date of resignation, if earlier. 
 
All options outlined above are fully exercisable at the Director’s discretion during the relevant exercise period.   28  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Key management compensation 
The Directors are of the opinion that the key management of the Group were the Executive Directors of Ceres Power Holdings plc up until 14 
February 2013, and from that date were the Chief Executive Officer, the Finance Director and the Director of Technology. The key 
management compensation is summarised in the following table: 
 
2013 
£’000 
2012 
£’000 
Salaries and other short-term employment benefits 514 547 
Post-employment benefits 23 27 
Termination benefits 475 – 
Share-based payments 107 144 
 1,119 718 
   
 
6. Pensions 
The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in 
independently administered funds. The pension charge represents contributions payable by the Group to the funds and amounted to 
£250,000 (2012: £400,000). A total of £24,000 (2012: £39,000) was payable to the funds at the year end. 
 
 
7. Income tax credit 
 
2013 
£’000 
2012 
£’000 
UK corporation tax – R&D tax credit (1,044) (2,400) 
Adjustment in respect of prior periods – R&D tax credit (267) (607) 
Income tax credit (1,311) (3,007) 
   
 
No corporation tax liability has arisen during the year (2012: £nil) due to the losses incurred. 
 
A tax credit has arisen as a result of the tax losses being surrendered in respect of research and development expenditure in the current and 
prior years. 
 
The tax result for the year is different from the standard rate of small profits UK corporation tax of 20% (2012: 20%). The differences are 
explained below: 
 
2013 
£’000 
2012 
£’000 
Loss before income tax 12,686 (17,907) 
Loss before income tax multiplied by the UK tax rate of 20% (2012: 20%) (2,537) (3,581) 
   
Effects of:   
Losses carried forward    980 988 
Enhanced tax deductions for R&D expenditure (1,141) (2,282) 
Expenses not deductible for tax purposes 339 154 
Accelerated capital allowances and other timing differences 460 309 
Adjustment in respect of prior periods – R&D tax credit (267) (607) 
Difference between R&D tax credit and small company tax rates 855 2,012 
Total income tax credit (1,311) (3,007) 
 
 
8. Loss per share  
Basic and diluted loss per £0.01 ordinary share are calculated by dividing the loss for the financial year attributable to ordinary shareholders 
by the weighted average number of ordinary shares in issue during the year. Given the losses during the year, there is no dilution of losses 
per share in the year ended 30 June 2013 or in the previous year.  
 
The loss for the financial year ended 30 June 2013 was £11,375,000 (2012: £14,900,000) and the weighted average number of £0.01 (2012: 
£0.05) ordinary shares in issue during the year ended 30 June 2013 was 292,793,498 (2012: 86,202,251). 
   Ceres Power Holdings plc Annual Report 2013   29 
 
 
 
 
 
9. Property, plant and equipment 
 
Leasehold 
improvements 
£’000 
Plant and 
machinery 
£’000 
Computer 
equipment 
£’000 
Fixtures 
 and fittings 
£’000 
Assets under 
construction 
£’000 
Total 
£’000 
Cost       
At 1 July 2011 2,646 6,637 761 140 280 10,464 
Additions 253 602 233 3 50 1,141 
Transfers 89 162 29 – (280) – 
       
At 30 June 2012 2,988 7,401 1,023 143 50 11,605 
Additions – 45 – (5) 6 46 
Transfers – – 50 – (50) – 
Disposals (1,523) (750) – – – (2,273) 
At 30 June 2013 1,465 6,696 1,073 138 6 9,378 
       
Accumulated depreciation       
At 1 July 2011 1,182 3,992 553 102 – 5,829 
Charge for the year 373 1,332 151 21 – 1,877 
Amortisation of grant contributions (32) (279) (6) – – (317) 
       
At 30 June 2012 1,523 5,045 698 123 – 7,389 
Charge for the year 305 1,197 168 13  1,683 
Amortisation of grant contributions (32) (323) (6) – – (361) 
Disposals (1,208) (306) – – – (1,514) 
At 30 June 2013 588 5,613 860 136 – 7,197 
       
Net book value       
At 30 June 2013 877 1,083 213 2 6 2,181 
At 30 June 2012 1,465 2,356 325 20 50 4,216 
At 30 June 2011 1,464 2,645 208 38 280 4,635 
       
 
10. Subsidiary undertakings  
Details of the Company’s subsidiaries at 30 June 2013 are as follows:  
Name of undertaking Country of incorporation Description of shares held 
Proportion of nominal value of 
shares held by the Company 
Ceres Power Limited England and Wales £0.001 ordinary shares 100% 
Ceres Intellectual Property Company Limited England and Wales £1.00 ordinary share 100% 
 
The principal activity of Ceres Power Limited is the development and commercialisation of its core fuel cell and fuel cell module technology. 
The principal activity of Ceres Intellectual Property Company Limited is the administration of registered intellectual property developed 
within the Group. The results of Ceres Power Limited and Ceres Intellectual Property Company Limited are included within these 
consolidated financial statements.  
 
   30  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
11. Trade and other receivables 
 
2013 
£’000 
2012 
£’000 
Current:   
Other receivables 231 301 
Prepayments and accrued income 223 282 
 454 583 
Non-current:   
Prepayments and accrued income 53 81 
 507 664 
 
There is no difference between the fair value of trade and other receivables and their carrying values and they are not overdue at 30 June 
2013. There have been no provisions for impairment of receivables during the year (2012: £nil). The carrying amounts of the Group’s trade 
and other receivables are all denominated in pounds sterling.  
 
 
12. Cash and cash equivalents and short-term investments  
 
2013 
£’000 
2012 
£’000 
Cash at bank and in hand 576 716 
Money market funds 8,654 9,460 
Short-term bank deposits < three months – 2 
Cash and cash equivalents 9,230 10,178 
Short-term bank deposits > three months 6,207 – 
 15,437 10,178 
 
The Group holds surplus funds in accordance with the treasury policy, as set out in note 14. 
 
Interest rate 
type 
2013 
£’000 
2012 
£’000 
Interest rate risk profile of the Group’s financial assets:    
Cash at bank and in hand Floating 576 716 
Money market funds Floating 8,654 9,460 
Short-term bank deposits < three months Floating – 2 
Short-term bank deposits > three months Floating 6,207 – 
  15,437 10,178 
    
The short-term bank deposit > three months has a notice period of 95 days (2012: fixed terms of between nine and 12 months and earned 
interest between 1.25% and 2.00%). Floating rate cash deposits, money market funds and other bank deposits earned interest based on 
relevant UK LIBID-related equivalents. The credit quality of financial assets has been assessed by reference to external credit ratings. 
 
 
13. Trade and other payables  
 
2013 
£’000 
2012 
£’000 
Current:   
Trade payables 354 527 
Taxation and social security 83 197 
Other payables 36 46 
Accruals and deferred income 877 998 
 1,350 1,768 
Non-current:   
Accruals and deferred income 1,918 2,354  Ceres Power Holdings plc Annual Report 2013   31 
 
 
 
 
 
14. Financial instruments  
The Group only uses derivative financial instruments to hedge foreign currency exposures arising from an underlying current or anticipated 
business requirement and not for any speculative purpose. The Group does not currently use derivative instruments to manage its interest 
rate risk. The Group does not trade in financial instruments.  
 
Fair values of financial assets and financial liabilities  
There is no difference between the fair value and the carrying value of the Group’s financial assets and financial liabilities. Carrying value 
approximates to fair value because of the short maturity periods of these financial instruments.  
  
Financial risk management  
The Group’s operations expose it to a variety of financial risks that include credit risk and market risk arising from changes to foreign 
currency exchange rates and interest rates. The Board reviews and agrees policies for managing each of these risks.  
 
The principal risks addressed are as follows:  
 
Credit risk  
The Group’s exposure to credit risk arises from holdings of cash and cash equivalents and short-term investments. The Group’s primary 
objective to manage credit risk is to minimise the risk of a loss of capital and eliminate loss of liquidity having a detrimental effect on the 
business.  
 
The Group typically places surplus funds into pooled money market funds and bank deposits with durations of up to 12 months. The Group’s 
treasury policy restricts investments in short-term sterling money market funds to those which carry short-term credit ratings of at least two 
of AAAm (Standard & Poor’s), Aaa/MR1+ (Moody’s) and AAA V1+ (Fitch) and deposits with banks with minimum long-term rating of A/A-/A3 
and short-term rating of F-1/A-2/P-2 for banks which the UK Government holds less than 25% ordinary equity.  
 
Interest rate risk  
Interest rate risk on the Group’s liabilities is minimal.  
 
The Group’s finance income is sensitive to changes in interest rates. A change of 1% in interest rates would have impacted the finance 
income by £0.1 million (2012: £0.1 million) in the year ended 30 June 2013. 
 
Liquidity risk  
Cash flow forecasting is performed by the Group. This includes forecasting of the Group’s liquidity requirements to ensure the Group has 
sufficient cash to meet its operational needs. 
 
Foreign currency exposures  
The Group seeks to minimise its exposure to fluctuations in exchange rates by taking out forward currency contracts to hedge against foreign 
currency denominated commitments, when known. At 30 June 2013, 100% (2012: 100%) of foreign currency commitments were either 
hedged by foreign currency contracts or covered by cash held. Fair value is based on the market price of comparable instruments at the 
balance sheet date.  
 
The Group does not hold any forward currency contracts at the year end. The mark to market losses of the forward currency contracts held 
prior to year end in the Consolidated Statement of Comprehensive Income were £7,000 (2012: losses of £22,000).  
 
The following table presents the Group’s assets and liabilities that are measured at fair value at 30 June 2013. 
 
Level 2  
2013  
£’000 
Level 2  
2012  
£’000 
Financial assets at fair value through profit or loss:   
Derivatives used for hedging – 7 
 
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by 
using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as 
possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in 
level 2.   32  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
The table below shows the extent to which the Group has monetary assets and liabilities in currencies other than pounds sterling. Foreign 
exchange differences arising on the retranslation of these monetary assets and liabilities are taken to the Consolidated Statement of 
Comprehensive Income.  
 
2013 
£’000 
2012 
£’000 
Foreign currency monetary assets:   
United States dollar 107 157 
Euro 40 142 
 147 299 
 
The Group has net euro denominated trade payables of £17,000 (2012: £48,000) and US dollar denominated trade payables of £39,000 
(2012: £60,000). 
 
The functional currency of the Company is pounds sterling.  
 
 
15. Provisions for other liabilities and charges  
Property dilapidation and onerous lease provisions charged to the Consolidated Statement of Comprehensive Income are set out below:  
 
Provisions for the year ended 30 June 2013 
 
Property 
Dilapidations  
£’000 
Onerous Leases 
£’000 
 
Total 
£’000 
At 1 July 365 – 365 
Charged to the Consolidated Statement of Comprehensive Income 195 733 928 
At 30 June 560 733 1,293 
 
The dilapidation provision recognised is being built up to match the present value of costs to be incurred, which is materially the same as the 
expected costs to be incurred, in making good the various leasehold properties at the end of their respective leases, details of which are in 
note 19. The onerous lease provision recognised provides for the full cost of the remaining life of the leases on properties after the date that 
the company expects these properties to have no further use. 
 
Provisions for the year ended 30 June 2012 
 
Property 
Dilapidations 
£’000 
Onerous Leases 
£’000 
 
Total 
£’000 
At 1 July 228 – 228 
Charged to the Consolidated Statement of Comprehensive Income 137 – 137 
At 30 June 365 – 365 
 
Deferred taxation 
Potential deferred tax assets have not been recognised but are set out below: 
 
2013 
£’000 
2012 
£’000 
Tax effect of temporary differences because of:   
Difference between capital allowances and depreciation (1,587) (1,057) 
Deductions relating to share options (497) – 
Losses carried forward (10,112) (9,397) 
Pensions (6) – 
 
 
(12,202) (10,454) 
 
The deferred tax assets have not been recognised, as the Directors consider that it is unlikely that the asset will be realised in the 
foreseeable future. 
   Ceres Power Holdings plc Annual Report 2013   33 
 
 
 
 
 
16. Share capital 
 
2013            2012 
 Number £’000 Number £’000 
Allotted and fully paid     
At 1 July 86,215,662 4,311 86,177,614 4,309 
Allotted under share option schemes 2,235,838 22 38,048 2 
Allotted on cash placing & open offer 448,347,623 4,484 – – 
Ordinary shares of £0.01 each at 30 June (2012 £0.05) 536,799,123 8,817 86,215,662 4,311 
 
On 18 December 2012 each existing ordinary share of £0.05 was sub-divided into 1 new ordinary share of £0.01 and 1 deferred share of 
£0.04. All shares issued from 18 December 2012 were new ordinary shares of £0.01. The new ordinary shares of £0.01 have the same rights 
and benefits as the original ordinary shares of £0.05. The deferred shares of £0.04 are not listed and it is intended that all the deferred 
shares will be surrendered for no value and/or cancelled in due course. 
 
On 18 December 2012 the Company issued 330,000,000 ordinary shares of £0.01 each in a placing and open offer for cash consideration of 
£3,300,000. On 2 April 2013 the Company issued 118,347,623 ordinary shares of £0.01 each in a placing and open offer for cash 
consideration of £9,467,810 (before deducting issue costs of £208,050). Also 2,235,838 ordinary shares of £0.01 each were issued on the 
exercise of employee share options for cash consideration of £31,792 (2012: the Company issued 38,048 £0.05 ordinary shares on exercise 
of employee share options for consideration of £1,902). 
 
 
17. Share options 
The total charge recognised in the year ended 30 June 2013 relating to employee share-based payments was £414,000 (2012: £468,000). 
 
The Company has a number of share option schemes and savings-related share option plans for its employees and a separate scheme for 
Executive Directors.  
  
2013 
£’000 
2012 
£’000 
a) 2004 Employees’ share option scheme 280 5 
b) Executive Directors’ one-off award 75 216 
c) 2009 Sharesave scheme – 27 
d) CHP Project Bonus plan – 167 
c) 2010 Sharesave scheme 17 16 
c) 2011 Sharesave scheme 42 37 
  414 468 
 
a) Ceres Power Holdings Limited 2004 Employees’ share option scheme 
The Company has issued share options under this scheme for Directors and employees, under which approved and unapproved share 
options were granted, prior to the flotation of the Company in November 2004 and in subsequent years. The Company adopted the ‘Ceres 
Power Holdings Limited 2004 Employees’ share option scheme’ at the time of flotation. 
 
Under this scheme, Directors and employees hold options to subscribe for £0.01 ordinary shares in Ceres Power Holdings plc at prices 
ranging from £0.01 to the closing mid-market price on the day preceding the most recent share option grant. All options are equity-settled. 
The vesting period for all options is generally three years. If the options remain unexercised after a period of ten years from the date of the 
grant, the options expire. Options are forfeited if the employee chooses to leave the Group before the options vest.  
 
   34  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Movements in the total number of share options outstanding and their relative weighted average exercise price are as follows: 
 2013 2012 
 
Number  
(’000) 
Weighted 
average 
exercise price  
Number  
(’000) 
Weighted  
average  
exercise price  
Outstanding at 1 July 5,426 £0.94 5,782 £0.94 
Granted 45,693 £0.03 – – 
Exercised (2,000) £0.01 – – 
Lapsed (2,404) £0.72 (356) £0.89 
Outstanding at 30 June 46,715 £0.10 5,426 £0.94 
Exercisable 3,400 £1.11 5,426 £0.94 
 
The weighted average share price on the exercise date of options was £0.025 (2012: none exercised). 
 
The range of exercise prices for options outstanding at the end of the year is as follows:
 
 
 2013 2012 
Expiry date – 30 June 
Weighted 
average  
exercise price 
Number  
(’000) 
Weighted 
average  
exercise price  
Number  
(’000) 
2014 £0.39 1,937 £0.41 1,938 
2015 £0.67 189 £0.73 220 
2016 £2.53 812 £2.42 895 
2017 £2.18 380 £2.24 420 
2018 £2.23 45 £2.02 155 
2019 £0.82 37 £0.96 249 
2020 – – £1.07 5 
2023 £0.03 43,315 – – 
 
The options outstanding at the end of the year have a weighted average contractual life of 9.00 years (2012: 2.21 years). 
 
 
b) Executive Directors’ one-off award 
All ‘one-off’ options remain outstanding and unexercisable at 30 June 2013. No options were granted, exercised or lapsed in the year or the 
previous year.  
 
The expiry dates of options outstanding at the end of the year are as follows:
 
 
 2013 2012 
Expiry date – 30 June 
Weighted 
average 
exercise price 
Number  
(’000) 
Weighted 
average 
exercise price  
Number  
(’000) 
2018 £2.00 1,688 £2.00 1,688 
2019 £2.00 213 £2.00 213 
     
The options outstanding at the end of the year have a weighted average contractual life of 5.57 years (2012: 6.57 years).  
 
   Ceres Power Holdings plc Annual Report 2013   35 
 
 
 
 
 
c) Ceres Power Holdings Sharesave scheme 
No HMRC-approved savings-related share option schemes were implemented during the year or the previous year.   
 
Movements in the total number of share options outstanding and their relative weighted average exercise price are as follows: 
 
 2013 2012 
 
Number  
(’000) 
Weighted 
average 
exercise price  
Number  
(’000) 
Weighted 
average 
exercise price  
Outstanding at 1 July 460 £0.52 740 £0.51 
Lapsed/cancelled (365) £0.53 (280) £0.50 
Outstanding at 30 June 95 £0.47 460 £0.52 
Exercisable 10 £1.12 108 £0.81 
     
No options were granted in the year or the previous year.  
 
The expiry dates of options outstanding at the end of the year are as follows: 
 
2013 2012 
Expiry date – 30 June 
Actual and 
weighted 
average 
exercise price 
Number 
(’000) 
Actual and 
weighted 
average 
exercise price 
Number 
(’000) 
2014 £0.64 30 £1.12 15 
2015 £0.40 65 £0.40 288 
 
The options outstanding at the end of the year have a weighted average contractual life of 1.08 years (2012: 1.70 years). 
 
 
d) CHP Project Bonus plan 
The CHP Project Bonus plan was a medium-term incentive scheme running from 2009 to 2012 under which a performance-related bonus of 
cash and nominal value share options was awarded to Executive Directors and senior managers.   These share options, if not exercised, 
lapsed on 30 June 2013.  
 
No options were granted in the year ended 30 June 2013 (2012: 236,000). 
 
Movements in the total number of share options outstanding and their relative weighted average exercise price are as follows: 
 
 2013 2012 
 
Number 
(’000) 
Actual and 
weighted 
average 
exercise price 
Number 
(’000) 
Actual and 
weighted 
average 
exercise price 
Outstanding at 1 July 445 £0.05 323 £0.05 
Granted – – 236 £0.05 
Exercised (245) £0.05 (38) £0.05 
Lapsed (200) £0.05 (76) £0.05 
Outstanding at 30 June – – 445 £0.05 
Exercisable – – 59 £0.05 
 
The weighted average fair value of options granted in 2012 was £57,057.  The weighted average share price on the day of exercise of options 
was £0.095 (2012: none exercised).  
 
   36  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Assumptions 
Fair values of all schemes, apart from the Executive Directors’ one-off award, which was measured using a binomial pricing model, were 
measured by use of the Black-Scholes pricing model. The inputs to the Black-Scholes model were as follows: 
 
 
 
2004 Share 
Scheme 
2013  
CHP Project 
Bonus plan 
2012 
Grant date  18 Dec 12–2 Apr 13  
27 July  
2011 
Share price at date of grant (£)  0.025–0.099  0.29 
Exercise price (£)  0.01–0.099  0.05 
Expected volatility (%)  70  65 
Expected option life (years)  Up to 5 years  1.0 
Average risk-free interest rate (%)  2.3%  3.5 
Expected dividend yield  Nil  Nil 
 
The exercise prices of options are stated above. The expected life of the options is based on the best estimate of the average number of 
years expected from grant to exercise. The expected volatility is based on historical volatility of the Company’s shares since it was admitted 
to AIM. The risk-free rate of return is management’s estimate of the yield on zero-coupon UK Government bonds of a term consistent with 
the expected option life. 
 
 
18. Cash used in operations  
 
2013 
£’000 
2012 
£’000 
Loss before income tax (12,686) (17,907) 
Adjustments for:   
   
Other finance income (55) (165) 
Depreciation of property, plant and equipment (net of amortised grant contributions) 1,322 1,560 
Disposal of property, plant and equipment 759 – 
Share-based payments charge 414 468 
Operating cash flows before movements in working capital (10,246) (16,044) 
Decrease in trade and other receivables 163 307 
Decrease in trade and other payables (861) (1,915) 
Increase in provisions 928 137 
Decrease/(Increase) in working capital 230 (1,471) 
Cash used in operations (10,016) (17,515) 
 
 
19. Operating lease commitments 
The Group leases premises and office equipment under non-cancellable operating lease agreements. The future aggregate minimum lease 
payments under non-cancellable operating leases are as follows:
  
 
 
2013 
Land and  
buildings 
and Other 
 £’000 
2012 
Land and  
buildings 
and Other 
 £’000 
No later than one year 397 461 
Later than one year and no later than five years 539 907 
Later than five years – 40 
 936 1,408 
 
The property leases have an average minimum term of 3.4 years (2012: 4.4 years). The rentals are fixed for the lease terms subject to 
periodic rent reviews. The office equipment leases have an average term of 1.6 years (2012: 2.5 years). 
 
   Ceres Power Holdings plc Annual Report 2013   37 
 
 
 
 
 
20. Contingent liabilities 
During the year, the Group recognised grant income in respect of research and development activities of £1,000 (2012: £182,000) as other 
operating income (see note 3), in accordance with the Group’s accounting policy. The Directors consider that there is a contingent liability 
only in respect of grants received in the 12 months prior to the balance sheet date. The repayment of grants received prior to this is 
considered of remote likelihood, as grants may be required to be repaid if the Group does not meet subsequent reporting requirements as 
specified in the grant offer letters. In addition £705,000 (2012: £705,000) of grants received, or an element thereof, may require repayment 
if the Group generates revenue (net of expenses and reasonable overheads) from the patent created from the grant. In such case, the Group 
may be liable to pay back the grant at a rate of 5% of the net revenue generated in any one year. The Directors of the Group believe it is 
unlikely that any of the grants received will need to be repaid in the foreseeable future. 
 
 
21. Capital commitments 
Capital expenditure that has been contracted for but has not been provided for in the financial statements amounts to £93,000 as at 30 June 
2013 (2012: £4,000), in respect of the acquisition of property, plant and equipment. 
 
 
22. Related party transactions 
The Group’s related parties are its Directors, Steve Callaghan Services Limited, ORA (Guernsey) Ltd. which held 28.21% of ordinary shares at 
30 June 2013 (2012: none), and IP Group Limited which held 24.69% of ordinary shares at 30 June 2013 (2012: none). ORA (Guernsey) Ltd. 
has appointed Mike Bretherton as a Non-Executive Director and IP Group has appointed Alan Aubrey as Chairman and Robert Trezona as a 
Non-Executive Director. Compensation paid to the Group’s Directors is disclosed in note 5. Transactions with IP Group Limited during the 
year amounted to £29,770 (2012: £nil) comprising primarily of legal and recruitment services, and there was an outstanding balance due of 
£4,000 at 30 June 2013 (2012: £nil). The outstanding balance with IP Group Limited was due 30 days after the invoice date to be settled for 
cash. There were no other related party transactions in the year or the previous year. 
 
 
 
   38  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Independent Auditors’ Report  
to the Members of Ceres Power Holdings plc 
 
We have audited the parent Company financial 
statements of Ceres Power Holdings plc for the year 
ended 30 June 2013 which comprise the Company 
Balance Sheet and the related notes. The financial 
reporting framework that has been applied in their 
preparation is applicable law and United Kingdom 
Accounting Standards (‘United Kingdom Generally 
Accepted Accounting Practice’). 
 
Respective responsibilities of Directors and auditors 
As explained more fully in the Statement of Directors’ 
responsibilities set out on page 13 the Directors are 
responsible for the preparation of the parent Company 
financial statements and for being satisfied that they give 
a true and fair view. Our responsibility is to audit and 
express an opinion on the parent Company financial 
statements in accordance with applicable law and 
International Standards on Auditing (UK and Ireland). 
Those standards require us to comply with the Auditing 
Practices Board’s Ethical Standards for Auditors. 
 
This report, including the opinions, has been prepared 
for and only for the Company’s members as a body in 
accordance with Chapter 3 of Part 16 of the Companies 
Act 2006 and for no other purpose. We do not, in giving 
these opinions, accept or assume responsibility for any 
other purpose or to any other person to whom this 
report is shown or into whose hands it may come save 
where expressly agreed by our prior consent in writing. 
 
Scope of the audit of the financial statements 
An audit involves obtaining evidence about the amounts 
and disclosures in the financial statements sufficient to 
give reasonable assurance that the financial statements 
are free from material misstatement, whether caused by 
fraud or error. This includes an assessment of: whether 
the accounting policies are appropriate to the parent 
Company’s circumstances and have been consistently 
applied and adequately disclosed; the reasonableness of 
significant accounting estimates made by the Directors; 
and the overall presentation of the financial statements. 
In addition, we read all the financial and non-financial 
information in the Annual Report to identify material 
inconsistencies with the audited financial statements. If 
we become aware of any apparent material 
misstatements or inconsistencies we consider the 
implications for our report.  
 
Opinion on financial statements  
In our opinion the parent Company financial statements: 
  
 give a true and fair view of the state of the 
Company’s affairs as at 30 June 2013; 
 have been properly prepared in accordance with 
United Kingdom Generally Accepted Accounting 
Practice; and 
 have been prepared in accordance with the 
requirements of the Companies Act 2006.  
 
 
Opinion on other matter prescribed by the Companies 
Act 2006 
In our opinion the information given in the Directors’ 
Report for the financial year for which the parent 
Company financial statements are prepared is consistent 
with the parent Company financial statements.  
 
Matters on which we are required to report by 
exception  
We have nothing to report in respect of the following 
matters where the Companies Act 2006 requires us to 
report to you if, in our opinion: 
 
 adequate accounting records have not been kept by 
the parent Company, or returns adequate for our 
audit have not been received from branches not 
visited by us; or 
 the parent Company financial statements are not in 
agreement with the accounting records and returns; 
or 
 certain disclosures of Directors’ remuneration 
specified by law are not made; or 
 we have not received all the information and 
explanations we require for our audit. 
 
Other matter 
We have reported separately on the Group financial 
statements of Ceres Power Holdings plc for the year 
ended 30 June 2013.  
 
Rosemary Shapland 
(Senior Statutory Auditor) 
for and on behalf of PricewaterhouseCoopers LLP 
Chartered Accountants and Statutory Auditors 
Gatwick 
30 September 2013 
 
  Ceres Power Holdings plc Annual Report 2013   39 
 
 
 
 
 
Company Balance Sheet 
as at 30 June 2013 
 
 
Note 
2013  
£’000 
2012  
£’000 
Fixed assets    
Investments 4 6,097 5,754 
    
Current assets    
Debtors: amounts falling due after more than one year 5 1,672 1,435 
Debtors: amounts falling due within one year 5 32 26 
Short-term investments  6,207 2 
Cash at bank and in hand  8,835 9,667 
  16,746 11,130 
Creditors: amounts falling due within one year 6 (109) (324) 
Net current assets  16,637 10,806 
Total assets less current liabilities  
 
22,734 16,560 
    
Net assets  22,734 16,560 
    
Capital and reserves    
Called up share capital 8 8,817 4,311 
Share premium account 9 72,906 64,821 
Profit and loss account 9 (58,989) (52,572) 
Total shareholders’ funds 10 22,734 16,560 
 
The financial statements on pages 39 to 43 were approved by the Board of Directors on 30 September 2013 and were signed on its  
behalf by: 
 
Philip Caldwell  Richard Preston 
Chief Executive Officer  Finance Director 
  
Ceres Power Holdings plc 
Registered Number: 5174075 
  40  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Notes to the Company Financial Statements 
for the year ended 30 June 2013 
 
 
1. Accounting policies 
These separate financial statements of the Company 
have been prepared on the going concern basis, under 
the historical cost convention and in accordance with the 
Companies Act 2006 and applicable accounting standards 
in the United Kingdom. A summary of the more 
important accounting policies, which have been 
reviewed by the Board of Directors in accordance with 
Financial Reporting Standard (“FRS”) 18, ‘Accounting 
policies’, and which have been applied consistently 
except where noted, is set out below. 
 
Fixed asset investments 
The investment in Ceres Power Limited is accounted for 
under merger accounting principles and is shown at the 
nominal value of shares issued as consideration for the 
undertaking less any amount written off to reflect a 
permanent diminution in value. The investment in Ceres 
Intellectual Property Company Limited is stated at cost 
less any amount written off to reflect a permanent 
diminution in value.  
 
Current asset investments 
Current asset investments comprise money market funds 
and bank deposits that are not repayable on demand.  
 
Amounts owed by Group undertakings 
Amounts owed by Group undertakings are recognised 
and carried at the original invoice amount less an 
allowance for any uncollectable amounts that are made 
when the full amount is no longer considered receivable. 
A provision for impairment of amounts owed by Group 
undertakings is established based on estimated 
recoverable amounts.  
 
Deferred taxation 
The Company applies FRS 19, ‘Deferred tax’, which 
requires provision to be made in respect of timing 
differences between the treatment of certain items for 
accounting and tax purposes. Deferred tax assets are 
recognised only to the extent that they are regarded as 
recoverable. Deferred tax assets and liabilities are not 
discounted. 
 
Share-based payments 
Share options 
The Group has a number of employee and executive 
share option and award schemes under which it makes 
equity-settled share-based payments. The fair value at 
the date of grant of equity-settled, share-based 
payments is expensed on a straight-line basis over the 
vesting period, based on the Group’s estimate of shares 
that will eventually vest. The charge is then credited back 
to reserves.  
 
The fair value of employee share options is calculated 
using a Black-Scholes or binomial model. In accordance 
with FRS 20, ‘Share-based payment’, the resulting cost is 
charged to the profit and loss account over the vesting 
periods of the plans. The value of the charge is adjusted 
to reflect the expected and actual levels of options 
vesting. FRS 20 has been applied to all grants of equity 
instruments after 7 November 2002 that were unvested 
as of 1 January 2006 and to all later grants. 
 
Options are granted both to employees of the Company 
and to employees of the Group. All share-based 
compensation related to subsidiary employees has been 
recharged to the subsidiary undertaking by way of a 
capital contribution to the subsidiary. This capital 
contribution for the current year has increased 
investment value by £343,000 (2012: £375,000) with the 
corresponding credit posted to reserves. 
 
Pension scheme arrangements 
The Company operates a defined contribution pension 
scheme for employees. The assets of the scheme are 
held separately from those of the Company. The pension 
costs charged represent contributions paid by the 
Company to individual pension plans and are charged to 
the profit and loss account as they become payable. 
 
In addition, a stakeholder pension scheme is also 
available to employees. 
 
Research and development expenditure 
Expenditure on research and development is written off 
to the profit and loss account as incurred.  
  
Related party transactions 
The Company has taken advantage of the exemption 
available to parent companies under FRS 8, ‘Related 
Party Disclosures’, not to disclose transactions and 
balances with wholly owned subsidiaries.  
 
2. Loss for the year 
The Company has taken advantage of the exemption 
available under section 408 of the Companies Act 2006 
and has not presented its profit and loss account. The 
Company’s result for the year was a loss of £6,831,000 
(2012: £15,584,000), which is stated after charging 
£16,000 (2012: £15,000) for remuneration receivable by 
the Company’s auditors for the auditing of the financial 
statements. The loss for the year includes a provision of 
£5.5 million provision against amounts owing to the 
Company by Ceres Power Limited (2012: £15 million).  Ceres Power Holdings plc Annual Report 2013   41 
 
 
 
 
 
3. Employees and Directors 
The average monthly number of persons (including Executive Directors) employed by the Company during the year was: 
 
 
2013  
Number 
2012  
Number 
By activity:   
Administration 1 1 
 
The only employee of the Company during the year was also a Director and highest paid Director of the Company. 
 
2013  
£’000 
2012  
£’000 
Staff costs (for the above persons):   
Wages and salaries, including compensation for loss of office 377 207 
Social security costs 53 33 
 430 240 
 
A total of £nil (2012: £nil) was payable in respect of pension contributions by the Company at the year end. 
 
Further information on Directors’ emoluments, see note 5 to the consolidated financial statements. 
 
 
4. Fixed asset investments 
In subsidiary companies: 
 
2013  
£’000 
2012  
£’000 
Cost and net book value:   
At 1 July 5,754 5,379 
Capital contributions arising from FRS 20 share-based payment charge 343 375 
At 30 June 6,097 5,754 
 
The capital contributions arising from the FRS 20 share-based payment charge are due to the Company granting share options to the 
employees of Ceres Power Limited.  
 
The Company’s investments comprise interests in Group undertakings, details of which are shown below: 
Name of undertaking Country of incorporation Description of shares held 
Proportion of nominal 
value of shares held  
by the Company 
Ceres Power Limited England and Wales £0.001 ordinary shares 100% 
Ceres Intellectual Property Company Limited England and Wales £1.00 ordinary share 100% 
 
The principal activity of Ceres Power Limited is the development and commercialisation of its core fuel cell and fuel cell module technology. 
The principal activity of Ceres Intellectual Property Company Limited is the administration of registered intellectual property developed 
within the Group. The results of Ceres Power Limited and Ceres Intellectual Property Company Limited are included within the consolidated 
financial statements. The Directors believe that the carrying value of investments is supported by their underlying net assets, or the net 
present value of projected future cash flows. 
 
 
   42  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
5.  Debtors 
 
2013  
£’000 
2012  
£’000 
Amounts falling due within one year:   
Other debtors 7 13 
Prepayments and accrued income 25 13 
 32 26 
   
Amounts falling due after more than one year:   
Amounts owed by Group undertakings 1,672 1,435 
 1,704 1,461 
 
The amounts owed by Group undertakings comprise inter-company loans and recharges. No specific repayment or interest terms are 
associated with these amounts. As of 30 June 2013, a provision of £59,316,000 (2012: £53,861,000) has been made against the inter-
company loan to Ceres Power Limited, reflecting management’s best estimate of the recoverable amount.  
 
A subordination agreement exists between the Company and Ceres Power Limited. Amounts owed by Ceres Power Limited to the Company 
of £59,316,000 (2012: £53,861,000) are subordinated to all other creditors of Ceres Power Limited. 
 
 
6. Creditors: amounts falling due within one year 
 
2013  
£’000 
2012  
£’000 
Trade creditors 14 13 
Taxation and social security 8 37 
Other creditors – 1 
Accruals and deferred income 87 273 
 109 324 
 
 
7. Deferred Taxation 
 
Potential deferred tax assets have not been recognised but are set out below: 
 
2013  
£’000 
 2012  
£’000 
Tax effect of timing differences because of:   
Deductions relating to share options (11) – 
Losses carried forward (819) (700) 
 (830) (700) 
   
The deferred tax assets have not been recognised as the Directors consider that it is unlikely that the asset will be realised in the foreseeable 
future.  
 
 
8. Called up share capital 
 
2013 2012 
 Number £’000 Number £’000 
Allotted and fully paid     
Ordinary shares of £0.01 each (2012: £0.05) 536,799,123 8,817 86,215,662 4,311 
 
Details of shares issued in the period are provided in note 16 to the Group financial statements. Details of share options are disclosed in note 
17 to the Group financial statements. 
 
   Ceres Power Holdings plc Annual Report 2013   43 
 
 
 
 
 
9. Reserves 
 
Share premium 
account  
£’000 
Profit and loss  
account  
£’000 
At 1 July 2012 64,821 (52,572) 
Premium on shares issued:   
    New shares issued on cash placing (net) 8,076  – 
    Exercise of share options 9 – 
Loss for the financial year – (6,831) 
Share-based payments charge – 414 
At 30 June 2013 72,906 (58,989) 
 
 
10. Reconciliation of movements in shareholders’ funds 
 
2013  
£’000 
2012  
£’000 
Loss for the financial year (6,831) (15,584) 
Proceeds of issue of ordinary share capital 12,799 2 
Share issue costs (208) – 
Share-based payments charge 414 468 
Net change in shareholders’ funds 6,174 (15,114) 
Opening shareholders’ funds 16,560 31,674 
Closing shareholders’ funds 22,734 16,560 
   
 
   44  Ceres Power Holdings plc Annual Report 2013   
 
 
 
 
 
Directors and Advisors  
Directors of Ceres Power Holdings plc 
Alan Aubrey (Non-Executive Chairman) 
Phil Caldwell (Chief Executive Officer) 
Richard Preston (Finance Director) 
Steve Callaghan (Non-Executive Director) 
Mike Bretherton (Non-Executive Director) 
Mike Lloyd (Non-Executive Director) 
Robert Trezona (Non-Executive Director) 
 
Registered number 
5174075 
 
Company secretary 
Bruce Girvan 
 
Registered office 
Viking House 
Foundry Lane 
Horsham 
West Sussex 
RH13 5PX 
 
Independent auditors 
PricewaterhouseCoopers LLP 
Chartered Accountants and Statutory Auditors 
First Point 
Buckingham Gate 
Gatwick 
West Sussex 
RH6 0NT 
 
Solicitors 
DAC Beachcroft LLP 
Portwall Place 
Portwall Lane 
Bristol 
BS99 7UD 
 
Bankers 
National Westminster Bank plc 
South Kensington Station Branch 
PO Box No 592 
18 Cromwell Place 
London 
SW7 2LB 
 
Nominated advisor (NOMAD) 
Nplus1 Singer Advisory LLP 
One Bartholomew Lane 
London 
EC2N 2AX 
 
Brokers 
Nplus1 Singer Advisory LLP 
One Bartholomew Lane 
London 
EC2V 2AX 
 
Registrar 
Computershare Investor Services PLC 
PO Box 82 
The Pavilions 
Bridgwater Road 
Bristol 
BS99 7NH 
 
‘Ceres Power’ and ‘Powered by Ceres’ are registered trademarks belonging to the Group. 
 
 
 
 
 
 
 
 
   www.cerespower.com
Ceres Power Holdings plc
Viking House
Foundry Lane
Horsham
West Sussex
RH13 5PX