Final Results

RNS Number : 4787O

Gas Turbine Efficiency PLC

30 June 2010

 



30 June 2010

Gas Turbine Efficiency plc

Preliminary announcement of results for the year ended 31 December 2009

Gas Turbine Efficiency plc ('GTE', the 'Company' or 'the Group'), a leading provider of proprietary cleantech systems for enhancing the performance of industrial and aviation turbines, announces its audited results for the year ended 31 December 2009.

Financial Highlights

•         Group revenue increased by 5.5% to US$37.1m (2008: US$35.1m)

•         Energy Services saw 12% growth while Aviation revenue was down 21% due to cash conservation by customers and OEM de-stocking

•         Gross profit margins before warranty decreased to 35% (2008: 41%), driven by the change in revenue mix.

•          Loss before tax of US$5.9m (2008: profit US$0.9m)

•          Earnings per share of US$-0.052 (2008: US$+0.007)

Operational Highlights

 

•         Turbine Services platform added to strengthen ties to end customers in the power generation sector

•         More than US$11.0m invested in new development and infrastructure for growth, ten new products launched

•        Patent portfolio strengthened from 16 to 20, with an additional 22 patent applications pending or provisionally filed

•         Strengthened market channels in US, EMEA and oil & gas, with addition of leading commercial team

Recent Developments

•         First quarter 2010 revenue US$9.8m, up 32% (US$2.4m) over first quarter 2009,

•       Energy Services aftermarket revenues in first quarter 2010 up 273% at US$4.2m and Aviation revenues up 85% at US$1.6m

•         Harry Zike appointed Chief Financial Officer with immediate effect

•        Agreed terms for additional interim funding from certain new and existing shareholders with a commitment of US$10m

Steve Zwolinski, Chief Executive Officer of GTE, commented:

"Sales in our future growth platform, Energy Services, were up 12% last year in one of the most challenging power markets, and this momentum has continued to build into 2010. Despite difficult recessionary conditions, there are several very positive market drivers - environmental, technical and economic - which GTE expects to align in the coming years, thus creating an unprecedented market for GTE's solutions. The Board is confident that the market will gradually improve and global economic demand will increase for GTE's products. The Company is now positioned more strongly than ever for the rapidly evolving opportunities in the large global energy market."

For further information, please contact:

Gas Turbine Efficiency plc 

Steven Zwolinski, Chief Executive Officer                                           [phone]

Matrix Corporate Capital LLP

Louis Castro / Nick Ellis                                                                      [phone]

Financial Dynamics

Jon Simmons / Susanne Yule                                                             [phone]

Documents to Shareholders  

The information set out in this announcement has been extracted from the Annual Report and Accounts 2009, which is being posted to shareholders today and is available to download from the Company's website at www.gtefficiency.com. Included with the Annual Report and Accounts 2009 is the Notice of Annual General Meeting which is convening an Annual General Meeting to be held at the offices of Bird and Bird LLP, 90 Fetter Lane, London, EC4A 1JP, on 4 August 2010 at 12 noon.

About GTE

Gas Turbine Efficiency plc (GTE) designs, manufactures and supplies proprietary cleantech energy- saving and performance-enhancing solutions to the power generation, oil & gas and aviation industries. GTE's extensive portfolio of patented cleantech solutions save fuel, reduce emissions, increase availability, and extend turbine and parts life.

The Group also provides solutions for burning a wider variety and quality of primary and alternative fuels.  Specific products and services developed by our world-class technology team include compressor cleaning and power augmentation systems; fuels management systems; combustion design, repair, upgrade and monitoring; and fluid and control auxiliaries. The Group's systems and associated services are provided to turbine end users and OEMs including General Electric, Pratt & Whitney, Rolls Royce, Caterpillar-Solar and Siemens from operation centres in Europe and the USA. GTE's shares are traded on London Stock Exchange's AIM (Ticker: GTE).

Financial Review

2009 was a tough year overall - and an important evolutionary year for GTE. Despite a difficult recessionary market, our long-term growth platform - Energy Services - saw a 12% revenue growth in a challenging market environment. That said, 2009 was a tale of two very different halves.

In the Energy Services business, the first half of 2009 saw revenues up 29% despite global recessionary market pressures. However, with a temperate US summer, reduced demand and lower electricity prices layered on top of the recession - end customers implemented extreme cash conservation measures in the second half of 2009, delaying as many expenditures as possible.

In Aviation, we saw similar behaviours. After a strong first half, GTE's exclusive partner Pratt & Whitney (P&W), implemented a strict cash conservation programme including "de-stocking" inventory - resulting in zero equipment orders in the second half. The temporary de-stocking programme was completed in December 2009 and P&W resumed equipment orders in the first quarter of 2010 - with a US$1.6m order in January.

As a result of the second half of 2009 revenue shortfalls in Energy Services and Aviation, GTE realised some US$10m lower revenues than anticipated, which placed an additional cash pressure of some US$4m on the business. In addition, the inflexibility of our US working capital facilities  - which had not been taken up before the second half of 2009 - resulted in an additional US$3m of unanticipated working capital pressures.  The US$7m of cash pressures, when added to GTE's previously committed development and P&E investment of US$11m, caused a cash pinch point in the fourth quarter of 2009.  This was addressed by a three-year debt facility of US$10m from major shareholders, board and management.

To further underpin the business,  GTE has agreed terms with existing and new investors for an amendment and extension of the existing facility which will provide up to US$10m to continue to finance the Group's working capital and development funding programmes.

Chief Executive Officer's Review

Through a challenging 2009, our future growth platform, Energy Services, increased revenues by 12% in one of the most challenging power markets.

In 2009, we took steps to put the building blocks in place that are required for a globally competitive Energy Services platform.

Our compressor cleaning solution - recognised as an industry standard - achieved new performance milestones on the most advanced turbines in the world - yielding 100% paybacks within as little as four months.

Our ECOMAX™ system has delivered more than promised to our customers - including as much as a 2% output increase in addition to exceptional emissions control - resulting in as little as four-month payback.

We landed our first orders for newly launched replacement parts for gas turbines in the combustion sector - a very important foundational block for future growth. We have rapidly gained a reputation as one of the highest quality and fastest turnarounds in this important recurring maintenance segment.

Our newly launched Turbine Services business received its first order within 90 days of launch and achieved "qualification" status from several of the leading power generation customers.

However, 2009 saw many challenges. While the Energy Services segment was up, the Aviation sector saw revenues decline by 21%, due to cash conservation and de-stocking by our exclusive channel partner, Pratt & Whitney. As a result, gross margins were down when compared with past years, reflecting a wider mix of lower margin, longer cycle auxiliary products and less contribution from shorter cycle aviation and combustion aftermarket revenues.

GTE kept focus on strengthening the infrastructure and product offerings in preparation for the rapidly emerging market opportunities. We took several long-term actions that are expected to pay significant dividends in 2010 and beyond.

We invested over US$11m in new products, capabilities and infrastructure that will start delivering benefits as early as 2010. These included combustion maintenance and upgrade solutions, expansion of the ECOMAX optimisation platform, compressor cleaning products and aviation product lines for the small, military and helicopter segments.

We expanded our patent portfolio from 16 to 20. New patent issues were granted in the aviation, auxiliary and combustion areas.

We added an online "Monitoring and Diagnostics" centre in Orlando, Florida. This centre monitors turbines 24x7 to assess the performance of our ECOMAX systems - and most importantly, directly connects GTE with our customers' control rooms.

Our Turbine Services platform consists of one of the most experienced teams in the industry.

GTE's track record of performance is stronger than ever before - and we are becoming a credible option for a growing part of the US$10bn gas turbine aftermarket.

The strategic importance of the Turbine Services platform provides more revenue in the most "recession resistant" segment of energy, strengthening our end user channel and relationships. It moves GTE to the point-of-action identifying equipment issues and emerging opportunities and provides the highest quality installation capability for our growing portfolio of solutions.

We continued to build our infrastructure to better position the Company for global growth, achieving ISO 9001:2008 certifications for all global operational centres during the expansion of the facilities.

Additional commercial leadership resources were added to bolster our end user channels in Europe and the US. The energy industry is adjusting to a post-recessionary demand profile and is rapidly coming to understand the need for equipment upgrades to meet their new economic, environmental and operational challenges. As fuel prices rise, the aviation industry is again looking for more fuel efficient solutions, evidenced by our order flow in 2010.

During the first half of 2010 GTE has been in discussions with various parties with a view to raising significant permanent funding that would be used to repay the outstanding shareholder loans and provide a solid financial footing to support the GTE's future growth.  As these discussions have not yet been completed, GTE has sought additional interim funding from certain major shareholders and a new investor to provide the operational and commercial flexibility to properly position GTE for the future.

Generation IM Climate Solutions Fund, L.P., Cleantech Europe 1 (A) LP and Cleantech Europe 1 (B) LP (being funds advised by Zouk Ventures Ltd.) and certain other shareholders, together with a new investor, Afikim Investments Limited, have agreed final terms to subscribe for up to US$10m of Loan Notes.  The financing is expected to be finalised shortly. The proceeds from the issue of the Loan Notes will be used to finance the Group's working capital and development funding programmes. 

I'd like to thank our customers, investors and team members for their continued support and investment during a challenging 2009.

Steven Zwolinski, Chief Executive Officer

Chairman's Statement

We share a vision of GTE as a growth company - the foundation for which is the unique set of technical capabilities that sets us apart as a provider of environmental, performance and productivity solutions.

Despite the energy industry continuing to conserve cash during 2009 and the consequent reduced demand, GTE continued to experience growth, especially in its Energy Services business. GTE is well positioned to grow in this market with newly launched products and services targeted at the more "recession resistant" energy aftermarket segment.

Electricity demand is expected to rebound in a post-recessionary market and remain strong for the next decade. Natural-gas-fired combined cycle capacity is an attractive choice for new power stations because of fuel efficiency, operating flexibility (it can be brought online in minutes rather than the hours it takes for coal-fired and some other generating capacity), relatively short planning and construction times (months instead of the years that nuclear power plants typically require), and capital costs that are lower than those for other technologies.

Environmental legislation that will curtail coal usage in Europe and other parts of the world is expected to create an impetus for power stations to upgrade and optimise existing gas turbines to take up the load, potentially reducing the need for new plants.

Economic pressures are expected to continue to push plant owners and operators toward more cost-effective solutions including more frequent maintenance, servicing and parts replacement plus productivity upgrades. GTE provides cost effective solutions in all these areas while offering leading technical depth and credibility.

To ensure that GTE is in a position to capture the value of the rapidly emerging market opportunities, it is important that we continue to fund research and development through potentially difficult, short-term markets.

With the investment of more than US$11m in new development/plant and equipment, GTE launched ten new products and increased registered patents from 16 to 20. A turbine services platform was added and market channels were augmented in the EMEA power generation and oil and gas markets with the addition of industry-leading talent increasing our long-term growth potential.

Building on our future

The Energy Services market is in a continual state of change. OEM long-term service agreements (LTSAs), born of necessity in the late 1990s, are still in use by approximately 60% of the F-Class gas turbine (GT) owner/operators today - even though the primary reasons for buying them may no longer exist. Non-OEM self-managed major maintenance upgrades provided by independent service providers are rapidly gaining acceptance, opening up a major market opportunity for GTE in the 2011 - 2014 timeframe.

Our OEM clients continue to accept our technology; independent service providers have begun deploying our products through their channels and strategic end user/fleet customers have installed our technology, validating investments. GTE has used this and many of the events of the past year as catalysts to evolve the business on several dimensions.

We continue to see investment in technology and patents. The evolution of our product portfolio is critical to success in capturing further market share over the next several years.

During 2009, long-term, cornerstone investors were brought into the Company who are supportive of GTE's vision and capitalisation requirements. They have facilitated our working capital needs and level of capitalisation - commensurate with the business strategy.

Board and governance

Board leadership and governance is a priority, particularly in a high growth company such as GTE. I am delighted to have been able to join the Board at such an exciting period in the Company's development, and would like to thank my predecessor as Chairman, John Bryant, for his dedication to the growth of the business. I will continue to strengthen the Board as appropriate to support the continuing growth of the business.

GTE is fortunate to have an extremely high-calibre executive team, consisting of recognised industry leaders and technical experts, and we will continue to build this team as necessary. I would like to thank them, and all our employees, for the commitment they have demonstrated, and continue to demonstrate, in positioning the Company to exploit the rapidly emerging opportunities in the global energy market.

I would also like to recognise the support and strengthening of our finance team, both internally and externally. In addition to improving our financial controls internally, we have appointed a new "NOMAD" (nominated financial advisor) in Matrix Corporate Capital. Most importantly, a number of new cornerstone investors have been added to our shareholder register. They, together with our existing shareholders, have been instrumental in supporting GTE's vision and requirements for capital to underpin the Company's growth strategy.

I have greatly enjoyed becoming part of the GTE team since the start of 2010 and look forward to working with our executives and employees, our shareholders and advisers in delivering the undoubted potential of this Company in the coming years.

John Grant, Non-Executive Chairman

CONSOLIDATED STATEMENTS OF INCOME
for the year ended 31 December 2009
		Note		2009		2008
				US$'000		US$'000
Continuing operations
	Revenue	1		37 074		35 119
	Cost of sales			(24 039)		(20 764)
Gross profit				13 035		14 355
	Distribution and selling costs			(4 287)		(3 598)
	Research and development expenses			(2 554)		(1 347)
	Administrative expenses			(11 486)		(8 850)
	Other operating income	2		-		320
Operating (loss)/profit		3, 4		(5 292)		880
	Interest receivable	5		333		720
	Finance costs	6		(923)		(669)
(Loss)/Profit before tax				(5 882)		931
	Tax	7		1 209		(440)
(LOSS)/PROFIT FOR THE YEAR ATTRIBUTABLE
TO EQUITY HOLDERS OF THE PARENT				(4 673)		491
(Loss)/Profit per share		8
	From continuing operations
	Basic (loss)/profit per share (US$)			(0.052)		0.007
	Diluted (loss)/profit per share (US$)			(0.052)		0.007
Earnings before interest, taxes, depreciation and amortisation (EBITDA)				(3 434)		1 736
Earnings before interest, taxes, amortisation and exceptional items (EBITAE)				(4 360)		2 045
Earnings before interest, taxes, depreciation, amortisation and exceptional items (EBITDAE)				(3 434)		2 549

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME for the year ended 31 December 2009

		Note		2009		2008
				US$'000		US$'000
(Loss)/Profit for the period				(4 673)		491
Currency translation differences of foreign operations				(621)		(930)
Currency translation differences of long-term intercompany loans				1 913		(1 029)
Adjustment in fair value of available-for-sale investments				32		(24)
Credit to equity for equity-settled share-based payments				879		241
Other comprehensive income for the period				2 203		(1 742)
Total comprehensive income for the period				(2 470)		(1 251)

CONSOLIDATED BALANCE SHEET
at 31 December 2009
		Note		2009		2008
ASSETS				US$'000		US$'000
Non-current assets
Intangible assets
	Goodwill	9		6 269		6 186
	Other Intangible Assets	10		18 038		10 196
				24 307		16 382
Tangible assets
	Equipment, tools, fixtures and fittings	11		4 065		1 943
Financial assets
	Available-for-sale investments	13		-		27
Deferred tax assets		14		3 447		2 056
Total non-current assets				31 819		20 408
Current assets
Inventories		15		5 935		3 410
Current receivables
	Accounts receivable-trade	16		9 213		8 695
	Income taxes recoverable			6		104
	Other receivables	17		190		1 173
	Prepaid expenses and accrued income			1 601		531
				11 010		10 503
Cash and cash equivalents		18		3 616		5 448
Total current assets				20 561		19 361
TOTAL ASSETS				52 380		39 769

CONSOLIDATED BALANCE SHEETS
at 31 December 2009 (continued)		Note		2009		2008
				US$'000		US$'000
EQUITY AND LIABILITIES
Equity
	Share capital	19		362		269
	Share premium			41 726		31 319
	Capital reserve			2 636		2 636
	Share-based payment reserve			1 660		781
	Revaluation reserve			-		(32)
	Translation reserves			1 298		7
	Retained earnings			(10 859)		(6 186)
Total equity attributable to equity holders of the parent				36 823		28 794
Non-current liabilities
	Financial liabilities - borrowings	20		1 028		73
	Deferred tax liabilities	14		143		195
				1 171		268
Current liabilities
	Financial liabilities - borrowings	20		5 244		157
	Accounts payable - trade			5 313		6 338
	Other liabilities			269		794
	Accrued expenses			3 560		3 418
				14 386		10 707
Total liabilities				15 557		10 975
TOTAL EQUITY AND LIABILITIES				52 380		39 769

CONSOLIDATED STATEMENTS OF CASH FLOWS
for the year ended 31 December 2009
		Note		2009		2008
				US$'000		US$'000
Cash flow from operating activities
	(Loss) / Profit before tax			(5 882)		931
	Adjustments to operating cash flows	21		3 355		1 338
Cash flow from operating activities before changes
in working capital				(2 527)		2 269
Cash flow from changes in working capital
	(Increase)/decrease in inventories			(2 525)		(2 078)
	(Increase)/decrease in receivables			(505)		(5 424)
	Increase/(decrease) in liabilities			(1 544)		6 246
Cash generated/(used by) operations				(7 101)		1 013
	Interest received			333		143
	Finance costs			(923)		(384)
Net cash generated/(used) by operating activities				(7 691)		772
Cash flows from investing activities
	Purchase of intangible non-current assets			(8 120)		(7 010)
	Purchase of tangible non-current assets			(3 228)		(1 228)
	Sale of tangible non-current assets			228		121
Net cash used by investing activities				(11 120)		(8 117)
Cash flows from financing activities
	New share issue (net of issue costs)			10 500		10 676
	Loans taken			5 942		216
	Loans repaid			-		(319)
Net cash (used in)/generated by financing activities				16 442		10 573
Effect of foreign exchange rate changes				537		(64)
Net change in cash and cash equivalents				(1 832)		3 164
Cash and cash equivalents at beginning of the year				5 448		2 284
Cash and cash equivalents at end of the year				3 616		5 448

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the period ended 31 December 2009

	Share capital	Share premium	Capital reserve	Share-based payment reserve	Revalua-tion reserve	Transla-tion reserve	Retained earnings	Total
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
Balance at 1 January 2008	207	20 705	2 636	540	(8)	1 966	(6 677)	19 369
New share issue 2,231,000 shares at nominal £0.002	9	1 388	-	-	-	-	-	1 397
New share issue 8,989,000 shares at nominal £0.002	35	6 683	-	-	-	-	-	6 718
New share issue  4,000,000 shares at nominal £0.002	16	2 987	-	-	-	-	-	3 003
New share issue 476,000 shares at nominal £0.002	2	297	-	-	-	-	-	299
Placing costs	-	(741)	-	-	-	-	-	(741)
Total comprehensive income for the period	-	-	-	241	(24)	(1 959)	491	(1 251)
Balance at 31 December 2008	269	31 319	2 636	781	(32)	7	(6 186)	28 794
New share issue 29,200,000 shares at nominal £0.002	93	11 150	-	-	-	-	-	11 243
Placing costs	-	(743)	-	-	-	-	-	(743)
Total comprehensive income for the period	-	-	-	879	32	1 291	(4 673)	(2 471)
Balance at 31 December 2009 (note 19)	362	41 726	2 636	1 660	-	1 298	(10 859)	36 823

A General information

Gas Turbine Efficiency plc designs, manufactures and supplies proprietary cleantech energy-saving and performance-enhancing solutions to the power generation, oil & gas and aviation industries.  GTE's extensive portfolio of patented cleantech solutions save fuel, reduce emissions, increase availability, and extend turbine and parts life.

The Group has an international footprint comprising eight sales offices and four operational centres which cover Europe, the Americas, Russia and the Middle East.

B Adoption of new and revised International Financial Reporting Standards

In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by the International Accounting Standards Board (IASB) and the International Financial Reporting Interpretations Committee (IFRIC) of the IASB which are applicable to its operations and apply to accounting periods beginning on 1 January 2009.   The Group and Company financial statements for the year ended 31 December 2009 have been prepared using accounting policies that are consistent with the financial statements for the year ended 31 December 2008 with the following exceptions.

IAS 1 (Revised) Presentation of Financial Statements

The revised Standard separates owner and non-owner changes in equity. The statement of changes in equity includes only details of transactions with owners, with non-owners changes in equity presented as a single line. In addition, the Standard introduces the statement of comprehensive income, where details of transactions with non-owners are presented.

IFRS 8, Operating segments

This Standard requires disclosure of information about the Group's operating segments and replaces IAS 14, Segment Reporting. IFRS 8 is a disclosure standard and does not impact the Group's financial position or result. See note 1 for additional information.

IAS 23 (Revised) Borrowing costs

The Standard has been revised to require capitalization of borrowing costs on qualifying assets and the Group has amended its accounting policy accordingly. In accordance with the transitional requirements of the Standard this has been adopted as a prospective change. Therefore, borrowing costs are capitalized on qualifying assets with a commencement date after 1 January 2009. No change has been made for borrowing costs incurred prior to this date that have been expensed.

None of the other new or amended Standards and Interpretations from IFRIC has had a significant impact on the financial position or result of the Group or Company.

1  Segment information
From 1 January 2009, IFRS 8 will be in effect. For management purposes, the Group is currently organised into the following two operating segments: Aviation and Energy Services. These business areas are the basis on which the Group reports its primary and only segment information.
Continuing operations		Aviation		Energy Services	Unallocated		Total for Group
		US$'000		US$'000				US$'000
31 December 2009
	Revenue external sale of goods	5 489		31 585				37 074
	Cost Of Goods Sold	(1 980)		(22 059)				(24 039)
Segment result - gross profit		3 509		9 526				13 035
Assets
	Inventory	1 046		4 889				5 935
	Receivables	2 550		6 663				9 213
	Intangibles	4 942		19 365				24 307
	Other assets					12 925		12 925
	Segment assets	8 538		30 917		12 925		52 380
Liabilities
	Segment liabilities					15 557		15 557
31 December 2008
	Revenue external sale of goods	6 909		28 210				35 119
	Cost Of Goods Sold	(2 966)		(17 798)				(20 764)
Segment result - gross profit		3 943		10 412				14 355
Assets
	Inventory	977		2 433				3 410
	Receivables	3 864		4 831				8 695
	Intangibles	3 555		12827				16382
	Other assets					18 470		18 470
	Segment assets	8 396		12 903		18 470		39 769
Liabilities
	Segment liabilities					10 975		10 975

2  Other Operating income
			2009		2008
			US$'000		US$'000
Exchange differences - operating transactions			-		320
3  Operating profit/(loss)
Operating profit/(loss) has been stated after charging the following:
			2009		2008
			US$'000		US$'000
Exchange differences - operating transactions			(155)		(370)
Exceptional legal costs			-		(351)
Exceptional trade mark costs			-		(325)
Exceptional administrative costs			-		(137)
Write down on inventories			(31)		(15)
Loss on disposal of fixed assets			(25)		-
Depreciation of equipment, tools, fixtures and fittings			(927)		(504)
Amortisation of intangible assets			(932)		(352)
Auditors' remuneration
			2009		2008
			US$'000		US$'000
Fees payable to the auditors for the audit
of the financial statements of
-     The Company			(30)		(71)
-     The Remainder of the Group			(108)		(96)
			(138)		(167)

4  Personnel costs
The average monthly number of employees
(including executive directors) was as follows			2009		2008
			No.		No.
Manufacturing/supply chain			33		22
Engineering/IT			51		29
Sales and marketing			15		10
General and administrative/finance			18		16
Executive directors/management			8		7
Total			125		84
			2009		2008
Their aggregate remuneration comprised:			US$'000		US$'000
Wages and salaries			(8 245)		(8 719)
Social security costs			(1 836)		(1 320)
Pension costs			(207)		(310)
Share-based payment expense			(854)		(241)
Other personnel costs			(476)		(106)
			(11 618)		(10 696)
			2009		2008
Directors' emoluments			US$'000		US$'000
Aggregate directors' emoluments			(882)		(1 071)
Company pension contributions to money purchase schemes			(31)		(19)
Sums paid to third parties for directors' services			-		(40)
			(913)		(1 130)
Number of directors accruing benefits
under money purchase schemes			1		1
Aggregate emoluments of highest paid director			334		566

Compensation of key management personnel
The remuneration of directors and other members of key management during the year was as follows:
			2009		2008
			US$'000		US$'000
Short-term benefits			2 641		3 318
Post-employment benefits			93		66
Share-based payments			852		106
			3 586		3 490

5  Interest receivable
			2009		2008
			US$'000		US$'000
Interest on bank deposits			12		37
Exchange differences on non-operating transactions			321		683
			333		720
6  Finance costs
			2009		2008
			US$'000		US$'000
Interest on bank overdrafts and loans			(130)		(66)
Interest on obligations under finance leases			(4)		(23)
Total borrowing costs			(134)		(89)
Exchange differences on non-operating transactions			(479)		(561)
Other interest expense			(310)		(19)
Total finance costs			(923)		(669)

7 Taxation			2009		2008
			US$'000		US$'000
Current tax - continuing operations			229		18
Deferred tax assets (note 14)			(1 386)		501
Deferred tax liabilities (note 14)			(52)		(79)
			(1 209)		440
The total charge/(credit) for the year can be reconciled to the accounting profit/(loss) before tax as follows:
			2009		2008
			US$'000		US$'000
Profit/(loss) before tax			(5 882)		931
Tax at the domestic tax rate in the UK (28%)			1 647		(261)
Effect of amounts which are not deductible
in determining taxable profit			(648)		29
Tax effect of utilisation of tax losses not previously recognised			-		85
Tax effect of not recognised tax losses			(205)		(158)
Effect of different tax rates of subsidiaries operating in
other jurisdictions			415		(135)
Tax (charge)/credit for the year			1 209		(440)

8  Profit/(loss) per share
Basic profit/(loss) per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year.
			2009		2008
Profit/(loss) attributable to equity holders of the Company (US$'000)			(4 673)		491
Weighted average number of ordinary shares in issue ('000)			89 666		67 181
Basic  profit/(loss) per share (US$ per share) - continuing operations			(0.052)		0.007
There are dilutive potential ordinary shares up to an amount of 1,888,730
Diluted profit/(loss) per share (U$ per share)			(0.052)		0.007

9  Goodwill
			2009		2008
			US$'000		US$'000
Cost
	As at 1 January		6 186		6 306
	Exchange differences		83		(120)
As at 31 December			6 269		6 186
The goodwill is allocated to the Groups operating segments as follows :
			2009		2008
			US$'000		US$'000
Energy Services			5 074		5 074
Aviation			1 195		1 112
			6 269		6 186
The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired.
The Group prepares cash flow forecasts derived from the most recent financial forecasts approved by the Board of Directors.  The view of the Board of Directors is that the future discounted cash flows of the Company over the next three years significantly exceed the currently booked goodwill asset

10 Other Intangible assets

		Research & Development	Patents	Customer Relations	ERP System	Total
		$'000	$'000	$'000	$'000	$'000
Cost
	As at 1 January 2009	7,807	1,716	514	899	10,936
	Additions	5,426	1,434	-	1,260	8,120
	Exchange Adjustments	576	101	-	35	712
	As at 31 December 2009	13,809	3,251	514	2,194	19,768
Amortisation
	As at 1 January 2009	316	13	196	215	740
	Provided in the year	644	39	103	146	932
	Exchange Adjustments	9	-	-	49	58
	As at 31 December 2009	969	52	299	410	1,730
Net Book Value at 31 December 2009		12,840	3,199	215	1,784	18,038
Cost
	As at 1 January 2008	3,155	938	514	604	5,211
	Additions	5,621	1,021	-	368	7,010
	Exchange Adjustments	(969)	(243)	-	(73)	(1,285)
	As at 31 December 2008	7,807	1,716	514	899	10,936
Amortisation
	As at 1 January 2008	251	10	93	98	452
	Provided in the year	143	4	103	102	352
	Exchange Adjustments	(78)	(1)	-	15	(64)
	As at 31 December 2008	316	13	196	215	740
Net Book Value at 31 December 2008		7,491	1,703	318	684	10,196

Research and Development

The Group continuously seeks to develop new techniques and methods to enhance the performance of its current product range at the same time as new products are developed.

Where a project is deemed to have a commercially qualifying product - with future positive cash flows - the costs of development are capitalised and amortised over the product's estimated economic life

Patents

The Group's granted and pending patents protect the design and specification of its gas turbine performance optimising products in countries in Europe, Asia and the Americas.

11 Equipment, tools, fixtures and fittings

					Held under						Held under
			Owned		leasing		Total		Owned		leasing		Total
			2009		2009		2009		2008		2008		2008
			US$'000		US$'000		US$'000		US$'000		US$'000		US$'000
Cost
As at 1 January			3 122		580		3 702		2 153		614		2 767
Purchases			3 228		-		3 228		1 224		4		1 228
Disposals			(311)		(15)		(326)		(176)		-		(176)
Exchange differences			55		(6)		49		(79)		(38)		(117)
As at 31 December			6 094		559		6 653		3 122		580		3 702
Amortisation
As at 1 January			1 337		422		1 759		1 085		400		1 485
Provided for the year			864		63		927		461		43		504
Disposals			(98)		-		(98)		(174)		-		(174)
Exchange differences			(3)		3				(35)		(21)		(56)
As at 31 December			2 100		488		2 588		1 337		422		1 759
Net book value
As at 31 December			3 994		71		4 065		1 785		158		1 943

12 Subsidiaries

Details of the Company's subsidiaries at 31 December 2009,  are as follows:
Name of subsidiary	Corporate identification number		Place of incorporation (or registration) and operation	Proportion of ownership interest and of voting power held	Principal activity
Gas Turbine Efficiency AB	556317-2823		Sweden	100%	Sales office
Gas Turbine Efficiency	556701-9509		Sweden	100%	Development centre,
Sweden AB					assembly, manufacturing,
					sales, Group management
Gas Turbine Efficiency	1013234		Sweden	100%	Onshore and offshore gas
Sweden AB - Abu Dhabi	Foreign company				installations and field services-
	Branch				natural gas and oil well
					equipment and maintenance
Gas Turbine Efficiency	05986580487		Sweden	100%	Sales office
Sweden AB - Italy	Foreign company
	Branch
Gas Turbine Efficiency	06813394		England	100%	Sales office
UK Ltd
Gas Turbine Efficiency	989 952 463		Norway	100%	Sales office
Norway AS
Gas Turbine Efficiency	50678473047733		Russia	100%	Sales office
Russia LLC
Gas Turbine Efficiency	200709401S		Singapore	100%	Sales office
Singapore Pte Ltd
Gas Turbine Efficiency Inc	1455755		USA	100%	Development, sales
					Group management
Gas Turbine Efficiency LLC	59-3597018		USA	100%	Development, assembly,
					marketing, sales
During the year ARES Technology LLC was merged into Control Centre LLC and the new entity re-named to Gas Turbine Efficiency LLC

13  Available-for-sale investments
			2009		2008
			US$'000		US$'000
Shares in listed companies - Sweden			-		27
These investments have been designated as "available-for-sale financial assets" in accordance with IAS 39 and are held at fair value.  The investment was disposed of during the year.

14  Deferred tax
The following are the deferred tax liabilities and assets recognised by the Group, and the movements thereon, during the current and prior reporting periods.
Deferred tax assets				Research and		Tax loss
		Inventory		development		carry-forward			Total
			US$'000		US$'000		US$'000		US$'000
At 1 January 2008			22		53		2 536		2 611
	Credited to the income statement		2		74		(577)		(501)
	Exchange differences		-		(6)		(48)		(54)
At 31 December 2008			24		121		1 911		2 056
	Debited to the income statement		(13)		-		-		(13)
	Credited to the income statement		-		133		1 266		1 399
	Exchange differences		-		7		(2)		5
At 31 December 2009			11		261		3 175		3 447
				Intangible			Untaxed
Deferred tax liabilities					assets		reserves		Total
					US$'000		US$'000		US$'000
At 1 January 2008					(206)		(60)		(266)
	Charged to the income statement				45		34		79
	Exchange differences				-		(8)		(8)
At 31 December 2008					(161)		(34)		(195)
	Charged to the income statement				67		(15)		52
At 31 December 2009					(94)		(49)		(143)

At 31 December 2009, the Group has unused tax losses of US$4,442,000 (2008: US$4,929,000) available for offset against future profits. These tax loss carry forwards all expire more than 5 years from the balance sheet date.
At 31 December 2009, the total tax losses carried forwards generated deferred tax assets of US$3,175,000  (2008: US$1,911,000). The tax losses carried forwards can be utilised to reduce future taxable income. Their future utilisation does not mean a lower tax charge for the Group. A deferred tax asset has not been recognised in respect of tax losses of US$2,022,859 (2008: US$1,838,000) due to the unpredictability of future income streams.
A deferred tax asset in respect of the total amount of these losses has been recognised as management's forecasts for the next three years indicate that these losses will be utilised by offset against available profits over the forecast period.

15  Inventories
		2009		2008
		US$'000		US$'000
Raw materials		4 894		3 362
Finished goods and goods held for resale		1 041		48
		5 935		3 410
During the period the group consumed US$17,204,000 (2008: US$16,615,000) of inventories and recognised write downs of US$30,513 (2008: US$14,720)

16  Accounts receivable-trade
			2009		2008
			US$'000		US$'000
Accounts receivable before deduction
of provisions for impairment of receivables			9 229		8 714
Provision for bad debt			(16)		(19)
			9 213		8 695
The directors consider that the carrying amount of trade accounts receivable approximates their fair value.

17  Other receivables
			2009		2008
			US$'000		US$'000
VAT Receivable			34		898
Customer deposits			-		19
Other			156		256
			190		1 173

The directors consider that the carrying amount of other receivables approximates their fair value.

18  Cash and cash equivalents
			2009		2008
			US$'000		US$'000
Cash at bank and in hand			3 616		5 448

19  Share capital
			2009		2008
			US$'000		US$'000
Authorised
2008 : 150,000,000 ordinary shares of £0.002 each			n/a		494
At the Annual General Meeting held on 9 June 2009 the new Articles of Association were adopted by the Company to them into line with the Companies Act 2006 ("the Act"). In accordance with the Act, the Company no longer has an authorised Share Capital.
Issued and fully paid
101,597,594 ordinary shares of £0.002 each			362		269
(2008: 72,397,594 ordinary shares of £0.002 each)
The Company has one class of ordinary shares which carry no rights to fixed income.
For information about the Company's option programme, see note 24.

20  Financial liabilities
The borrowings are repayable as follows:
						2009		2008
						US$'000		US$'000
Current
Invoice credit facility						904		-
Loans						4 194		104
Total bank loans and overdrafts (secured)						5 098		104
Finance lease obligations (secured)						135		53
Other interest bearing liabilities (secured)						11		-
Total other liabilities						146		53
Total on demand or within one year						5 244		157
Non - current
Bank loans						679		-
Finance lease obligations						349		73
Total non- current						1 028		73
Included in the loans is the initial $4million tranche of the $10million 9.5% subordinated unsecured loans 2012 which were issued in December 2009. Upon ratification at the January 2010 general meeting, these notes were reclassified as long term.
31 December 2009				USD		SEK		GBP
				US$'000		US$'000		US$'000
Invoice credit facility				904		-		-
Loans				4 011		873
Finance lease obligations						484
				4 915		1 357
31 December 2008				USD		SEK		GBP
				US$'000		US$'000		US$'000
Loans				-		-		104
Finance lease obligations				45		81		-
				45		81		104
At 31 December 2009, the Group had available US$ 2 280 000 (2008: US$1,500,000) of undrawn committed borrowing facilities in respect of which all conditions precedent had been met.

						2009		2008
						US$'000		US$'000
Securities		Security
Loan		Corporate mortgage				873		258
Credit facility		A/R & Inventory				904		1 629
Total						1 777		1 887
The average interest rates, excluding obligations under finance lease which are presented under note 26, were as follows:
						2009		2008
Loans other than finance leasing						9.5%		7%

21  Adjustments to operating cash flows
			2009		2008
			US$'000		US$'000
Depreciation of tangible and intangible assets			1 858		856
Profit on disposal of fixed assets			27		-
Share-based payments			879		241
Finance costs			923		384
Interest income			(333)		(143)
			3 354		1 338

22  Operating lease arrangements
Minimum lease payments under non-cancellable operating leases recognised as an expense in the year.
			2009		2008
			US$'000		US$'000
Minimum lease payments			389		612
At the balance sheet date, the Group has outstanding commitments under non-cancellable operating property leases, which fall due as follows:
			2009		2008
			US$'000		US$'000
Within one year			679		761
In the second to fifth years inclusive			1 376		2 162
			2 055		2 923
Operating lease payments represent rentals payable by the Group for its premises, leases are negotiated for an average term of four years and rentals are fixed for an average of four years.

23 Obligations under finance leases

			Minimum lease payments			Present value of minimum lease payments
			2009		2008		2009		2008
			US$'000		US$'000		US$'000		US$'000
Amounts payable under finance leases:
Within one year			116		56		101		50
In the second to fifth years inclusive			354		28		338		24
			470		84		439		74
Less: future finance charges			(31)		(10)		N/A		N/A
Present value of lease obligations			439		74		439		74
Less: Amount due for settlement within
12 months (shown under current liabilities)							(101)		(50)
Amount due for settlement after 12 months							383		24

It is the Group's policy to lease certain of its cars under finance leases. The average lease term is three years. For the period ended 31 December 2009, the average effective borrowing rate was 8,5% (2008: 8%). All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The carrying amounts of the Group's lease obligations are denominated in the following currencies:

31 December 2009							USD		SEK
							US$'000		US$'000
Within one year							15		101
In the second to fifth years inclusive							6		348
							21		449
The fair value of the Group's lease obligations approximates their carrying amount.
The Group's obligations under finance leases are secured by the lessors' title to the leased assets.

24  Share-based payments

Introduction

In order to ensure that management is appropriately incentivized to focus on the strategic growth of the Company, thereby driving value for shareholders, and to retain key personnel, the Company has established a number of option schemes;

·     The GTE Share Option Scheme (the "Option Scheme")

·     The GTE Swedish Share Option Scheme (the "Swedish Scheme")

·     The Gas Turbine Efficiency plc 2009 Long Term Incentive Plan (the "LTIP")

·     The Gas Turbine Efficiency plc 2009 Restricted Share Award Plan (the "RSP")

·     The Gas Turbine Efficiency plc 2009 Share Option Plan (the "SOP")

Summaries of the principal features of these schemes are set out below. As at 31 December 2009, options under these schemes over a total of 11,770,854 (2008: 2,990,000) ordinary shares had been granted.

a) The GTE Share Option Scheme (the "Option Scheme")

General

The Option Scheme was adopted by the Board of the Company on 15 November 2005. Benefits under the Option Scheme are not pensionable.

Eligibility

All executive directors and employees of the Company and any subsidiary of the Company are eligible to be granted options under the Option Scheme. Participation is at the discretion of the directors. This scheme is principally intended to provide options to eligible employees and executive directors who are not resident in Sweden.

Exercise price

Over the years 2005-2008, options have been granted at exercise prices of 26, 30, 45, 50, 53.5, 56 and 58- the market value of the ordinary shares at the time of grant.

Individual limits

The aggregate market value of shares (valued at the relevant date of grant) granted to an individual under this scheme or any other discretionary share option scheme in any year (excluding any options granted prior to admission) cannot normally exceed 400%, of the relevant individual's annual basic salary. In exceptional circumstances options may be granted in excess of this limit.

Exercise of options

Options will normally vest over a four-year period. If the option holder ceases employment with the Group as a result of death, injury, disability, redundancy, retirement or where the option holder's employing company or business is transferred out of the Group, normally options may be exercised to the extent vested for a period of 12 months in the case of death and three months in all other cases. Where employment ends for other reasons options will lapse unless the Board permits otherwise. The Board may grant options subject to alternative vesting and leaver arrangements.

Change of control, reorganisation and winding-up

Options may be exercised in full in the event of a change of control, reconstruction or winding-up of the Company. In the event of another company acquiring the Company, option holders may in certain circumstances exchange their options for options over shares in the acquiring company.

Scheme limits

The rules of the Option Scheme and the Swedish Scheme limit the grant of options so that the number of ordinary shares issued or remaining issuable by virtue of options granted under those schemes following admission and any other employee share scheme established by the Company in the ten years following admission, cannot exceed 15%, of the Company's issued share capital on the relevant date of grant.

Termination of schemes

No options may be granted under the Option Scheme or the Swedish Scheme after the tenth anniversary of the adoption by the Board of those schemes. Termination will normally be without prejudice to subsisting rights.

Adjustments

Options may be adjusted following a capitalisation, rights issue, sub-division, consolidation or reduction in the capital of the Company or any other variation of ordinary share capital.

b) The GTE Swedish Share Option Scheme (the "Swedish Scheme")

The Swedish Scheme was adopted by the Board of the Company on 15 November 2005. As at 31 December 2008, 848,500 ordinary shares (all granted in year 2005) had been made available for Swedish resident participants.  Per the rules of the Swedish Scheme, all granted shares lapsed on 20 December 2009.

Grant of options

Participants have been required to purchase their options for consideration equal to the fair value of those options. Such value is payable immediately or in arrears at the discretion of the directors.

Exercise price

Options have been granted at an exercise price of 30p - the market value of the ordinary shares on the time of grant. Options will normally become exercisable over a four-year period, 25% annually. Options under the Swedish scheme lapsed on the fourth anniversary of the date of grant (20 December 2009).

c) The Gas Turbine Efficiency plc 2009 Long Term Incentive Plan (the "LTIP")

Shares subject to the LTIP awards will vest three years from the date of grant, subject to continued employment and to the satisfaction of share price targets. Of the total number of ordinary shares subject to LTIP awards, 20% will vest if the Company's share price is equal to or more than 30p at the end of the three-year period, with vesting increasing on a sliding scale to 100% if the Company's share price is equal to or more than 80p at the end of the three-year period.

e) The Gas Turbine Efficiency plc 2009 Restricted Share Award Plan (the "RSP")

The RSP awards denoted (A) relate to deferred annual bonus payments. The shares subject to the awards will vest three years from the date of grant, subject to continued employment.  RSP awards have been granted with an exercise price of 24.25p per ordinary share.

The RSP awards denoted (B) will vest over a four-year period subject to continued employment.  RSP awards have been granted with exercise prices of 23.5p and 24.25p per ordinary share.

f) The Gas Turbine Efficiency plc 2009 Share Option Plan (the "SOP")

The shares subject to the SOP option will vest over a four-year period, subject to continued employment.

The Company may issue up to 15% of its shares within a ten-year period to satisfy awards to participants in the Schemes operated by the Company under which shares are issued.

SOP options have been granted with an exercise price of 23.5p per ordinary share.

Details of the share options outstanding during the year are as follows:

The options outstanding at the end of the year have a weighted average remaining contractual life of 3 years. 9,629,354 new LTIP, RSP and SOP awards were granted during the year (2008: 145,000). 848,500 options lapsed during the year (2008: 57,500).

The fair values were calculated using the Monte Carlo and Black-Scholes option pricing model. The inputs into the model were as follows:

Share option scheme	LTIP	RSP (A)	RSP (B)	Share Options/SOP
Option grant year	2009	2009	2009	2009	2008	2007	2005		Total
New options granted	4 000 000	3 324 354	1 205 000	1 100 000	289 230	754 000	2 548 500		12 786 182
No of options outstanding	4 000 000	3 324 354	1 205 000	1 100 000	289 230	696 500	1 360 000		11 540 182
Exercisable at the end of the year	-	-	-	-	180 480	348 250	1 360 000		1 888 730
Weighted average share price	£0.24	£0.243	£0.240	£0.24	£0.32	£0.54	£0.30
Weighted average exercise price	£0.504	£0.243	£0.240	£0.240	£0.322	£0.542	£0.300
Valuation method	Monte Carlo	Monte Carlo	Monte Carlo	Black- Scholes	Black- Scholes	Black- Scholes	Black- Scholes
Expected volatility	52.8%	52.8%	52.8%	52.8%	46.5%	46.5%	29.5%
Expected life (years)	3,8	3,0	3,7	3,8	7	7	7
Remaining life (years)	2.1	2.1	3.1	3.1	5.6	4.6	3.0		2.7
Risk free rate	1.72%	1.72%	1.45%	1.91%	5.08%	5.08%	4.14%
Expected dividend yield	£Nil	£Nil	£Nil	£Nil	£Nil	£Nil	£Nil
Fair value	£0.0982	£0.2425	£0.0957	£0.0957	£0.1786	£0.3000	£0.1174

The Group recognised total expenses of US$854,000 (2008: US$241,000) related to equity-settled share-based payment transactions during the year. The Swedish employees have paid fair value for their options of US$Nil (2008: US$Nil), which has been booked against equity.

25  Related party transactions

Transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note.

During the year Details of transactions between the Group and other related parties are disclosed below.

On 18 December 2009, the Company raised US$4m in loan notes from several of its key shareholders.

26 Financial instruments

The Group has one contract where the price is dependent on the relationship between USD/SEK exchange rates (cap and floor).  However, the economic risks and characteristics of this embedded derivative are closely related to the host contract, and so the derivative does not need to be separated from the host contract and accounted for as a derivative per IAS 39.

The main market risks to which the Group is exposed are interest rates and foreign exchange. There is also exposure to credit risk and liquidity risk. The Group monitors these risks and will take appropriate action to minimise any exposure through the use of natural hedges as far as possible.

The carrying amount of financial assets and liabilities recorded by IAS 39 category are summarised as follows:

					2009		2008
					US$'000		US$'000
Financial assets
Cash and cash equivalents					3 616		5 448
Loans and receivables: trade and other receivables					11 010		10 503
					14 626		15 951

Financial liabilities					2009		2008
At fair value through the income statement					US$'000		US$'000
Measured at amortised costs:
- Borrowings					6 272		230
- Trade and other payables					9 285		10 745
					15 557		10 975

Credit risk

The Group's overseas operations are partly financed by local currency loans and the equity element is largely hedged by long-term foreign currency borrowings. In addition, forward currency contracts are used as cash flow hedges of exposures on certain net currency sales exposures.

The Group controls its exposure to credit risk by setting limits on its exposure to individual customers and these are disseminated to operating companies and compliance is monitored by the internal audit department. As part of the process of setting customer credit limits, different external credit reference agencies are used, according to the country of the customer. There are no significant concentrations of credit risk.

Capital risk management

The Group manages its capital to ensure that entities in The Group will be able to continue as going concerns while maximising the return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Group consists of debt, which includes borrowing disclosed in note 23, cash and cash equivalents and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained earnings.

Gearing ratio

The gearing ratio at the year end is as follows:

					2009		2008
					US$'000		US$'000
Debt					(6 272)		(230)
Cash and cash equivalents					3 616		5 448
Net funds					(2 656)		5 218
Equity					36 823		28 794

Debt is defined as long- and short-term borrowings.

Equity includes all capital and reserves of the Group attributable to equity holders of the parent.

					2009		2008
					US$'000		US$'000
Financial assets
Less than 30 days					8 873		13 116
31 - 180 days					5 132		2 660
Over 180 days					621		175
					14 626		15 951

Liquidity risk

Financial liabilities maturity analysis

The Group manages liquidity risk on the basis of expected maturity dates.   The following table analyses financial liabilities at 31 December 2009 by remaining contractual maturity (contractual and undiscounted cash flows):

		Borrowings		Trade and other payables			Total
			US$'000		US$'000		US$'000
Less than one year			5 244		9 142		14 386
One to two years			194		-		194
Over Two years			834		-		834
			-		-		-
			6 172		9 142		15 414

At present the Group does expect to pay all liabilities at their contractual maturity.  In order to meet such cash commitments the Group expects the operating activity to generate sufficient cash inflows. In addition, the Group holds financial assets for which there is a liquid market and that are readily available to meet liquidity needs.

Included in the "less than one year" classification the initial $4million tranche of the US$10m 9.5% Subordinated Unsecured Loan Notes 2012, which were issued in December 2009.  Upon ratification at the January 2010 general meeting these notes were reclassified as long term

At the balance sheet date there were undrawn borrowing facilities of US$2 280 000 (2008: US$1,500,000) available for operating activities and to settle capital commitments. The Group maintains substantial borrowing facilities to ensure that it can manage to fund its budgeted operations and take advantage of expansion opportunities as they arise

Interest rate risk

The Group's exposure to interest rate risk mainly concerns financial liabilities. Liabilities are both fixed rate and floating rate. At present the Group does not hold loans and receivables that are short-term in nature. The following table analyses the breakdown of liabilities by type of interest rate:

					2009		2008
					US$'000		US$'000
Financial liabilities
Fixed rate					4 874		126
Floating rate					1 469		104
Non-interest bearing					9 061		10 745
					15 414		10 975

27 Post balance sheet events

Changes in directors

John Bryant resigned as a director and chairman of the Company and John Grant was appointed in his place on 4 January 2010.  Kevin Dotts resigned as a director on 2 April 2010.

General meeting

A General Meeting was held on 11 January 2010 in order to seek approval for the issue of warrants to subscribe for up to 15,200,000 ordinary shares in the capital of the Company and to make minor changes to the Company's Articles of Association. All resolutions were duly passed.

Share capital

On 11 and 15 January 2010, warrants to subscribe for 3,200,000 and 9,000,000 ordinary shares respectively in the capital of the Company were issued to several key shareholders, directors and senior management.

Directors' interests in options and warrants

On 15 January 2010, warrants to subscribe for 150,000,  21,450 and 21,450 ordinary shares in the capital of the Company were issued to John Grant, Steven Zwolinski and Kevin Dotts respectively. These warrants are included in the total number of warrants issued in January 2010 referred to in the Share Capital above.

In respect of the grant of 400,000 Gas Turbine Efficiency plc 2009 Restricted Share Award Plan ("RSP") awards to Kevin Dotts 100,000 shares will vest and be allotted to Kevin Dotts following the release of the Company's Preliminary Results.  The remaining awards, under the RSP and other share plans lapsed on 2 April 2010.

On 12 January 2010, 281,750 options were granted to John Grant at an exercise price of 16p.

Shareholder Loan

On 15 January 2010 the Company raised US$6m in Loan Notes from several of its key shareholders, directors and senior management and in respect of which John Grant was issued Loan notes to the value of $100,000, and Steven Zwolinski and Kevin Dotts were each issued Loan Notes to the value of US$14.300, which sums are included in the said US$6m.

Credit Facility

The Company has agreed terms on a US$10m secured credit facility which is expected to be finalised shortly. This facility is expected to provide the Company with sufficient funds to continue to trade for the foreseeable future.

 

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