Invinity Energy Systems plc's (LON:IES) Profit Outlook

We feel now is a pretty good time to analyse Invinity Energy Systems plc's (LON:IES) business as it appears the company may be on the cusp of a considerable accomplishment. Invinity Energy Systems plc manufactures and sells vanadium flow batteries (VFB) for energy storage solutions in the United Kingdom, Canada, the United States, Australia, and China. On 31 December 2023, the UK£50m market-cap company posted a loss of UK£23m for its most recent financial year. The most pressing concern for investors is Invinity Energy Systems' path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for Invinity Energy Systems

Consensus from 3 of the British Electrical analysts is that Invinity Energy Systems is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of UK£10m in 2026. So, the company is predicted to breakeven approximately 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 75% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Invinity Energy Systems' growth isn’t the focus of this broad overview, though, take into account that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. Invinity Energy Systems currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

This article is not intended to be a comprehensive analysis on Invinity Energy Systems, so if you are interested in understanding the company at a deeper level, take a look at Invinity Energy Systems' company page on Simply Wall St. We've also compiled a list of essential factors you should look at:

1. Historical Track Record: What has Invinity Energy Systems' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Invinity Energy Systems' board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.