Renergen loss deepens as helium promises fail to deliver

Renergen announced today that its net loss will deepen to at least R63.1 million, despite an earlier announcement its liquid helium (LHe) production training is now fully operational.

In a SENS announcement released on Friday, Renergen informed shareholders that its loss per share for the interim period ended 31 August 2024 will be significantly worse than the previous year.

The company said its loss per share will be between 42.7 and 48.7 cents bigger than the previous year, representing a decline of between 43% and 63%.

This means that Renergen will fall from a net loss of R43.5 million for the 2023 half-year period to a net loss of between R63.1 million and R72 million for the 2024 interim period.

“The loss and headline loss per share is primarily due to the lack of production time on both helium and liquid natural gas (LNG) during the commissioning period leading up to the end of the financial period in question,” the company said.

In mid-August this year, Renergen announced that its LHe production training is now fully operational, and the company plans to start selling helium to customers soon.

The company said it had been accumulating LHe inventory for sale to its customers, whose Iso-containers were scheduled to arrive later that month for filling.

It said that, since 19 July 2024, the plant had been producing LHe, initially utilising the output to cool the vacuum jacketed pipelines and the inline helium storage tank to around 4.5 kelvin, a prerequisite to ensure that LHe from the helium separator once sent to storage remains liquid. 

“The optimisation efforts during the commissioning phase have also yielded impressive results, evidenced by a significant reduction in timelines for the plant start-up and cooldown processes,” the company said.

For context, the initial startup and cooldown of the integrated LNG/LHe plant took over 65 days, while this most recent cooldown was accomplished in just 9 days, the company said.

“Despite the challenges encountered in reaching this milestone, we are thrilled to have achieved this significant development and to commence LHe sales to our customers,” Renergen said.

“Our team has unequivocally demonstrated its capability to manage and operate this facility effectively in the face of challenges and under extreme pressure.”

“The board and executive management take immense pride in this achievement, and we thank every one of our team who have worked tirelessly and made enormous personal sacrifices to make this objective a reality.” 

Renergen CEO Stefano Marani also told Zunaid Suleman from Benzinga All Access that, while the company is a year behind schedule, it has now reached the milestone it set out to achieve from the start.

“Where we’ve gotten to now is that we’ve finally managed to get the helium module on, we’re producing liquid helium, we’re putting it in our customer’s tanks, and that is the proof of concept now essentially closed,” he said.

The release of Renergen’s complete half-year results, expected to be published at the end of October, should reveal more details on how the company’s loss deepened so significantly.

In addition, the results should show how much revenue the company generated from the sales Marani spoke about.