Good afternoon, and welcome to the Ilika PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time via the Q&A tab situated on the right-hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today and publish responses where it's appropriate to do so.
Before we begin, I'd like to submit the following poll, and I'd now like to hand you to Graeme Purdy, CEO. Good afternoon, sir.
Thank you, Lily, and welcome to everybody who's chosen to attend this IMC session. This is Ilika's annual results for the year that finished at the end of April 2026. I'm joined here by our CFO, Jason, who despite appearances, is actually sitting next to me. He's looking at the screen on his own laptop. We are both at the same table.
Afternoon, everyone.
We will now go into the slides, and we will trot through, and if you have any questions, as Lily said, please submit them into the Q&A chat, and we will do our best to answer those for you. Those of you who've been following the company for some time now will know that we've got two product lines. They're both solid-state batteries. On the one hand, we've got our large format Goliath batteries, which have been designed for EVs and consumer appliances. On the other hand, we've got our Stereax miniature solid-state batteries, which have been designed for active implantable miniature devices. They are principally for medical applications as well as for Internet of Things, or wireless sensors. Let's have a trot through some of the activities, some of the milestones that we've delivered over the past year.
I'll start with Goliath. That's shown at the top there. We've secured significant grant funding from the Battery Innovation Programme and also the Advanced Propulsion Centre here in the U.K. We've effectively doubled up on the deployment of shareholder equity for our R&D program by accessing this grant funding. We have been working on prototype development with Jaguar Land Rover and also Agratas. We have a technology collaboration agreement with them. We've completed the automation of our megawatt-hour pilot line that we use for making these cells and sharing them with customers. We've also sent out batches of these cells to OEMs, and tier-one companies for them to evaluate and give us feedback. We've had some early feedback actually from a defense agency that advises the Ministry of Defence here in the U.K., on the safety and suitability of batteries, and that was a very positive validation.
Also we've announced that we're collaborating with that well-known folding bike brand, Brompton, for their e-bike range, and that program has just started. On Stereax, we have commenced production of our M300 batteries. We've initiated delivery of those batteries to customers, and we've also switched from being an R&D company to a revenue-generating company because we've now started recognizing revenue from the sales of electrodes for those batteries. We sell those electrodes to Cirtec. You'll see actually in our accounts that we've recognized a modest amount of GBP 100,000 in the last financial year, and of course, this is expected to grow in the year that we are now progressing. Just a quick review of our business model, for those of you that are not familiar with it. We have an asset-light business model, which means that we license our technology.
We've already licensed our Stereax technology through to Cirtec Medical. In return for that, we receive a profit share and royalties. That's what's shown in green at the bottom of this graphic, as well as revenue from the electrode sales, which we were just talking about. In blue, for Goliath, we receive grant support for the development of this technology, and then in due course, we will be licensing it, and also receiving engineering fees. In fact, some of those fees have already started because we sell prototype products, the 10 Ah prototypes that we released just before Christmas, and also the technology collaboration agreement that we've got. These are fee-paying arrangements, and then that flips into a royalty-bearing license.
We've been successful in securing a top-up round of funding just last month, and actually that's enabled some of these strategic imperatives over the next 12-18 months. First of all, for Stereax We're continuing to support Cirtec's marketing efforts. They are, of course, very active, particularly in the U.S., selling to their customers, and we can piggyback off their marketing efforts to actually make sure that the word on Stereax is getting out. Of course, there's some technical sales support that's required as part of that commercialization. The next thing that you'll see actually is an integration of our batteries into the Cirtec demonstrator, the Cirtec technology platform. That's one of the real advantages actually of working with them, is that they not only sell components, but they sell a technology platform that's then integrated into the products that their end customers sell.
Actually selling those cells as part of a solution, as part of their offering, will trigger the initial royalty payments, because those payments are due on product sales to or by Cirtec, rather than by the final commercialization of the product by the end customer. In terms of Goliath, we've got an opportunity to hit some early commercialization, which we're very excited about, because what's happened is that when we sent out those 10 Ah prototypes to a range of evaluation partners, some of them were non-automotive. Remember that those prototypes were really sent out not because they were the final product, but because they were an important milestone on our EV roadmap. Some of those organizations actually viewed a 10 Ah cell as being adequate for their applications, in particular, in the defense sector, and for e-bikes too.
Actually, the Brompton's another example of where this 10 Ah cell format is directly relevant to their product line. Based on the feedback that we've got from those evaluations, we have decided that we're going to take that prototype and turn it into a product. Of course, you need a larger amount of testing, and validation, certification in order to do that, and that's part of this MVP delivery. Hand-in-hand with that, we've got a series of commercialization agreements that we're talking about with non-automotive organizations. We expect to be able to put letters of intent and of course, full commercial agreements in place on the back of those discussions. That will enable us to generate some early revenue, close that gap to profitability, and give added commercial momentum to the company.
We haven't totally forgotten the EV commercialization opportunity. We've still got a series of 10 Ah validations of those cells that are in progress. It does take a while to complete those tests because cycle life is part of that validation, and actually understanding how resilient those batteries are is part of a full spectrum of testing of those cells. We are likely to secure some additional grant support for pack integration, and other scale-up activities, then that will lead into the first option to license. Before we get to a full license, there's likely to be an option phase, where a partner takes the technology, validates it, goes through the B-C-D sample route that people talk about for automotive, before integrating it into a vehicle design. Right. That's the overview.
Let's talk a bit about Stereax in some more detail. There you see the Stereax M300 product beside some pharmaceuticals in the central picture. On the right-hand side, that's actually a part of the Cirtec clean room, where we've got some of our equipment installed as part of the microfabrication that Cirtec carry out there. That partnership is really designed for growth. There are five end users that we'll talk about in a couple of slides' time. A nice portfolio of 16 customers that we're dealing with, We've actually got more orders than we've got customers, because some of those customers are big organizations and they have issued us with multiple orders. That's why we've got 19 as opposed to 16. We've commenced M300 deliveries to those customers, We've started generating those commercial revenues.
The actual electrodes are made on wafers. That's why we say it's wafer processing income. That's what we've started to recognize. That really will lead into the profit share and then ultimately revenue share once commercialization volumes have been achieved. We believe that this relationship continues to give us industry validation. One of the questions we often got from end customers, "Well, this is great technology, guys, but we're a multi-billion dollar company, and we expect to sell millions of this product. Can you really scale up?" Of course, with Cirtec, we've got a convincing scale-up partner. They've got significant multi-million revenues in the U.S. and have been a trusted commercialization partner for many of these OEMs for many years. There's a lot of credibility associated with that partnership.
Also, they have got a business development scale. They've got a commercial team that has access to the customers that we're dealing with now, and of course, a portfolio of others too, and a strategic alignment in that they're also very keen on commercializing products for active implantable medical devices. This will, we believe, enable faster adoption of Stereax than if we were trying to do it on our own. For the end customer, this has got many benefits, reduced surgery time, which actually is the biggest cost driver in getting a medical device. You can implant these tiny little devices close to the point of therapy, so you don't have to manage leads that run through the body. They have a long life. You can charge the batteries at home inductively, and they are powerful enough to be able to power a Bluetooth radio.
There you see, on the bottom right, an example of the M300 integrated into an orthopedic application. This is a knee replacement. In this example, the implant would measure movement in terms of amplitude and frequency of use and send that data out of the joint through to a physiotherapist, which would then coach the patient for the optimum recovery after the surgical intervention. Effectively securing better outcomes for the patients. There you see a summary of some of the milestones that we've achieved in 2025, and stuff to look forward to in the future. We've talked about integration in the Cirtec customer platform, and also commencement of royalty payments. These are the key applications really for Stereax. There are many potential applications, but these are the ones that we believe are the closest fit with what that technology can offer.
Orthopedic implants, like we've just seen, that's actually the biggest market. Lots of knee, hip, and shoulder replacements that would benefit from this technology. Neurostimulation. This is where you put a very small electrical current into the peripheral nervous system. That's the nervous system outside of the spinal column and the brain. This can help with pain relief. This is one of the principal applications where you can help with chronic back pain, for instance. Implanted sensors to measure blood pressure and also oxygen concentration in blood for patients with COPD. Ophthalmic applications, where you can measure the chemical composition of tears and help manage different conditions like diabetes. Finally, orthodontic applications, where again, it can be a compliance thing to make sure that people are wearing aligners, but also monitoring of biomarkers in saliva.
This is how we build up the financial projections for each of these applications. The hashed areas are the prototype volumes. Then we get through to mass manufactured product volumes. When we build up our financial forecast to assure ourselves of an attractive return on investment, we do that from the bottom-up. Rather than just saying, "Look, we're going to capture a percent of the market," we work out what's the volume of production that each of our customers are likely to be able to deliver. This is just one of eight prospects actually for orthodontics. Orthodontics is the most represented application in our customer base. It is also actually the application where we'll probably get a product to market first, because it's relatively easy to get FDA approval for this application.
This is a Class II medical device, and there are some drop-in replacements that are particularly a good fit with this particular technology offering. You get this for biomarkers, but also things like monitoring sports activities in particular, where you might get concussion risk in contact sports like rugby, American football, or soccer. Not only for professional athletes, those of you that follow the Six Nations rugby competition will have seen that you get collision monitoring in that event right now, but also more broadly, in amateur sports and for school kids, where you may want to monitor that more closely. Clearly, the smaller the battery, the more comfortable it is for people to wear these particular aligners.
Let's talk about Goliath. There you see a picture of our 10 Ah prototype, held by one of our engineers in the middle. Then on the right-hand side, you see actually some of our coating equipment. If you look closely, you can see a web, and that's what the industry calls these foils that you put the electrode onto. That's in fact a web with some anode coated on it. Why are people interested in solid-state batteries? Why bother with them? People are actually interested in better batteries. We did some modeling together with Balance Batteries, which is a well-known consultancy to the automotive industry. They worked out by taking a Goliath battery and putting it into a Hyundai IONIQ 5, that they could get a weight saving of 20%.
Of course, if you do that correlates to a range improvement of 20%, if you actually keep the weight of the battery the same, or you can have a more compact battery. There's also a cost saving. We know that EVs are more expensive relative to their traditional counterparts. Anything you can do to reduce the cost has got a significant benefit in terms of encouraging customer uptake. Also you can charge batteries more rapidly that are Goliath solid-state batteries. Here we've taken about a third of the charge time, reducing it from 18 minutes down to 12 minutes. Some very compelling reasons to adopt solid-state batteries. This is what the path to commercialization looks like when we look at some of these milestones with the green boxes around it.
We are expecting some more prototype validation back from the companies who have received those 10 Ah cells. We've built on some of that positive feedback by entering into discussions regarding letters of intent for non-automotive applications. That will of course turn into commercial relationships in short order. Further grant support to support the automotive roadmap that we've got. Early revenue actually from those 10 Ah MVP sales, that's really important, really, I think, to demonstrate the commercial traction of this technology. Then, of course, at the end of this, the first option to license with an OEM or a tier one counterparty. What does the deal structure look like? Look, we've already ticked off the foothills of this particular commercialization model, where we've already sold prototypes to companies who are interested in evaluating the batteries.
The reason that we don't give these batteries away is that we want to make sure that the people who are taking them for testing have some skin in the game. By charging a small amount towards the cost of making them, we make sure that people value the prototypes when they receive them. Sometimes that results in an engineering collaboration. We have such a collaboration in place with Agratas, which is the sister company to JLR. Both owned by Tata Sons. Agratas, of course, is the company that's building the U.K.'s largest, what will be the U.K.'s largest gigafactory in Bridgwater, in Somerset, not too far away from where Ilika is based. We expect that relationships like that will then lead to an option to license through the scale-up process.
When that goes well, an upfront license payment and ultimately royalties on the revenue from the sale of those cells. I probably don't need to convince you as an audience that EVs are here to stay. If you read the media, sometimes you might doubt that. Here's a bit of data from the International Energy Agency. Actually, this is global electric vehicle sales. That's historical data up to last year. For this year, it is a forecast. We're halfway through this year already, plenty of evidence. You see that China remains the country that has adopted the largest number of electric vehicles and continues to buy new EVs. Europe has also shown significant growth.
Actually, in Europe, in 2025, we got 27% growth of EV sales. The U.S. has shown a drop actually in the number of new EV sales. That's a bit of an outlier globally, largely due to the removal of incentives that are still in place in many other jurisdictions around the world. In China, they've been removed, and there's still strong growth there. The U.K. is very much in line with the rest of Europe, with the larger economies here in Europe, and is also showing strong growth. In fact, if you look at this chart on the right, this is from the OBR, the Office for Budget Responsibility here in the U.K.
At the end of 2025, they were still expecting that by 2035 that the total car stock on the road, so not just new purchases, but all of the cars, all of the vehicles that are on the road, the majority of them would be electric. In the first half of 2026, we've actually seen a bit of an acceleration of new vehicle registrations as EVs as a result of higher oil prices, so petrol and diesel prices at the pump, through the war in Iran. That's impacted fuel prices here, but let's see if that's sustained through the rest of the year. Most analysts think that actually that demand will continue to grow very strongly this year.
Part of the feedback, part of the validation that we got as our 10 Ah batteries were tested, was a piece of testing that we hadn't done before, and this probably wouldn't surprise you, but it was actually a Ministry of Defense advisory agency that took our cells and shot them to bits on a firing range. Of course, that's not part of the standard test that you would put an automotive battery through, so we hadn't done that before. We actually saw that there was a series of results that were very positive. Batteries, as you know, are used increasingly on the battlefield because of the large amount of electronics that soldiers carry for communication and location determination and intelligence gathering.
You can see actually in that picture, a battery pack that a soldier's got there, a conformal battery pack really, that the soldier's wearing on the vest. These have become a bit of a target because normal lithium-ion batteries, when they're hit, tend to go up with a small explosion, so they can cause more injury than even being shot by a bullet. Having ones that are safer and improved in their resistance to being penetrated is a real advantage. This is the type of early commercialization opportunity that we're looking at. Also there's a sovereignty angle here, where a lot of defense spending is being accelerated, particularly here in Europe, and countries are wanting to use it to stimulate their own economies and not be reliant on long supply chains from other jurisdictions.
I also wanted to mention the e-bike opportunity with Brompton. This is a piece of grant funding that we've just recently received from the Battery Innovation Programme. This is really supporting integration of those 10 Ah cells onto Brompton e-bikes, Brompton being the biggest bike manufacturer in the U.K., the biggest e-bike manufacturer as well, and the biggest exporter of e-bikes from the U.K. There are some real advantages to using Goliath batteries, increased energy density and enhanced safety. We're very excited about this application. There's obviously a lot of demand really for improved e-bike safety. You do read about incidents where people have got e-bikes on charge at home, and perhaps it's a poor quality battery that ends up causing a fire.
There's a lot of scrutiny of e-bikes. Also, of course, you're not allowed to currently put them on aircraft. If you can come up with a safer battery that gives the regulator more comfort that it wouldn't trigger an incident, there are commercial advantages to that. These are our annual results.
At this point, I'm going to let Jason talk you through the financials.
Thanks, Graeme. Just picking up the highlights from the financial reports that we've published out this morning. Revenue was flat year-on-year against the numbers published last year at GBP 1.1 million. Although it's important to note from within that, as Graeme has already touched on, we've got GBP 100,000 of the first revenue starting to come through from Stereax. If those eagle-eyed of you that have been watching the RNS announcements that have come out would've noticed that that came at the end of February, beginning of March. Really in the year to the end of April, we only just managed to get a couple of months of that in at the end of this financial period. We would expect that to build through this financial year as we go forward. That's really the start of revenue coming.
It's a great inflection point for the company. Really we're starting to get revenue from the wafers now, as Graeme has said, we'll look to see the actual batteries being delivered into that development activity at the customer end. Grant income continued on, GBP 1 million from grant income. We would expect to see that continue into future years. As Graeme's already said, we've got the Brompton activity, and there are other applications we have in process. Grants are not just a great way for us to get non-dilutive funding, but they're also a fantastic opportunity for us to work with people in the commercial sector. As a battery developer, you want to have access to people who are either further up the supply chain and closer to the end-use product or the end-use product themselves. Brompton is a prime example of doing that.
The previous grant-funded projects, PRIMED being the main one that we had in this financial year, was a great opportunity to work within the automotive industry with both partners and oversight from people in that industry. The EBITDA loss was GBP 6.2 million versus GBP 5.2 million, that's excluding the share-based payments. The reason for that increase was really a ramp-up of material. As we move from 2 Ah batteries that we were making a year ago up to 10 Ah batteries on the Goliath side, really we're consuming a significant increase in material as we're feeding into the larger batteries and producing more batteries that are then going into the test and evaluation program, both for us and for those customer partners that we've provided those batteries to. That really takes an increase in material coming through to be able to do that.
For anyone who's eagle-eyed and looked through the accounts, you'll have seen that up until this year, we have been capitalizing some of the development costs of the Stereax activity. That's the final stages of development as we move from an A sample through to a B sample. We were capitalizing that to create an intangible asset. Once we started generating that revenue, we brought that asset into its useful life, that means that we no longer capitalize cost to that, any of those costs from February onwards that we were experiencing anyway, no difference in cash, now falls onto the P&L or the income statement. No impact from a cash flow perspective, but you would see that on the income statement rather than the balance sheet, and therefore that makes that EBITDA loss a little bit larger.
That reflects down into that loss per share of GBP 0.0402 versus GBP 0.035 for the previous year. The year-end cash balance was GBP 5.3 million at the end of the year versus GBP 8 million the year before. That doesn't reflect the fact that we've had the recent cash raise done in July, which was very well-supported by both institutions and retail supporters. We are very thankful, and I'd like to take this opportunity again to thank those people who had the opportunity and chose to participate and continue to support us. Thank you very much for that.
Thanks, Jason. Let's have a final slide to wrap up with before we go and take a look at some of the questions that might have come in. We have a really strong patented portfolio across multiple jurisdictions. In fact, we've got 88 granted patents now. We are diversified across multiple markets that we've been talking about during this presentation, with some near-term opportunities for commercialization. I believe that the company now has a reduced execution risk. We have got in-house fabrication facilities, which allow us really to supply batteries through to our partners and validate any scale-up plans that we have in place.
We've already got a licensing and royalty agreement in place with Cirtec, which is set to deliver that economy of scale that we are chasing, and it provides us with the ability to rapidly ramp production of the batteries. The Goliath prototypes have already been shipped to a series of OEMs and Tier 1s, very positive feedback on that, in commercially sponsored evaluation trials.
Thank you very much. I'll just hand back to Lily for a moment.
That's great. Thank you very much for your presentation this afternoon. Ladies and gentlemen, please do continue to submit your questions. Just those in the Q&A tab situated on the right-hand corner of your screen. Just while the company take a few moments to review those questions submitted today, I'd like to remind you the recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via our investor dashboard. As you can see, we have received a number of questions throughout today's presentation. Can I please ask you to read out the questions and give response where appropriate to do so, and I'll pick up from you at the end.
Very good. Thank you, Lily. Yeah, we've received actually quite a few questions in advance of this session, which we have answered, and they'll be published shortly once we've wrapped up this presentation. We've seen some more come in actually as we've been speaking, so we will do our best to review and answer these. Let's see what we've got. The first one is, what is the status of the Agratas development? The status of that is that we have a technology collaboration agreement, and within that, we have a series of workshops and product deliveries. We have already delivered a number of prototypes as part of that relationship, and actually we expect to deliver some further ones.
That's a close interaction, and we value the opportunity to work together with the Agratas team, and exchange views on the competitiveness of our batteries, as well as their needs in order to ensure that they have a battery production that is going to be compelling for their end customers.
Got another question here: Can you inform us as the reason why the 50 Wh cell is sidelined for the moment? Actually, it's a 50 Ah cell. It hasn't been sidelined, but what we have decided to do is optimize the performance at the 10 Ah prototype level and actually, because we have limited resources, focus some of those resources on commercialization of that 10 Ah cell. Rather than have a full allocation of resource on further R&D, we realized that we want to make a strong and convincing return on investment, and when we've run the numbers, actually, we've convinced ourselves that it's better to deploy resources to commercialize what we have in hand, rather than continue to develop a larger product. Next one.
Maybe if I take it.
Yeah.
To give your voice a rest for a moment.
Thank you.
Have you had any input on any aspects of the design of the new Agratas factory in Bridgwater? Understandably, no, we have had no impact or advice given to that. Really that plays back to where we are looking to focus to our own strengths. We recognize that our skills are in that R&D sector, not in that mass manufacturing. You can see that in our relationship with Cirtec. We chose a partner that was best placed to manufacture at scale, for our Stereax partnership. Giving advice into Agratas in how they should set up a factory is not really appropriate.
What I would say is our choice of chemistry and cells has been designed around making it as applicable as possible to the standard gigafactories that are out there, also the model that Agratas are using, so that the cost of change or the cost of implementation of the Ilika Goliath cells is much lower than maybe some of the other sulfides or lithium metal chemistries that are out there that might need changes away from the current manufacturing sites. We've been able to prove that out and demonstrate that with some of the work that we've been able to do with the UK Battery Industrialisation Centre, the UKBIC, where they have taken our designs and run it on their larger gigascale-type equipment to be able to prove that out.
No direct input there, but also we've worked very closely in those conversations, as Graeme said, with Agratas on that collaboration to make sure that our technology is applicable to what they're doing within that factory.
What's the annual battery capacity of your pilot line, and how is it affected by battery applications for automotive defense or consumer? Annual capacity broad brush is 1.5 MWh per year. That means that when you take into account yields, that ultimately we will be able to produce up to 20,000 10 Ah batteries a year. It is an interesting question because what we built as a pilot line for automotive is actually the right size to be a commercial manufacturing line for some of these other smaller applications. Low volume, high margin manufacturing is something that we are evaluating in order to deploy that pilot line, maybe we should call it a mega factory line instead of a gigafactory line, more usefully in order to enhance our return on investment.
Next question here is, can you give us better clarity on what the future holds in terms of projected sales figures within specific quarters? Unfortunately, we are tightly regulated as an AIM market-listed company in what we can and can't say, so we are not in a position to be able to give that. What I would do is point you towards our own website and the analyst section there, which is available for anyone to access. You have to just click a couple of confirmations as you go into that, and that will give you a better understanding of where the analysts who've looked in depth at what we're doing have put in terms of this next financial year, and I think the Cavendish analyst goes a little bit further out than that, and they give their own rationale for those calculations.
While we can't provide it here, I'd point you in that direction and hopefully that will help answer your question.
Very good. Could defense become an earlier commercial opportunity than automotive? I think that's a really good question. We are seeing the defense sector radically reinvent itself. I think historically, timelines for new technology adoption in the defense sector were quite long. We have learned a lot from the war in Ukraine. I think a lot of defense authorities in Europe are looking to reequip themselves with relevant technology as quickly as possible, and actually, from being one of the slowest moving sectors, it appears to be rapidly becoming one of the fastest moving sectors with hybrid approaches to defense. For instance, in the Navy, not just large ships that take many years to build, large aircraft carriers and frigates, but actually a lot of marine autonomous uncrewed vehicles, and some very sophisticated technology, state-of-the-art technology that's being deployed.
I actually think that there's a very exciting opportunity for us in that sector.
Next question we've got here, how does Trump's tariffs impact Ilika? Actually, we are relatively well-placed to avoid any impact, and that goes back to that licensing model. One of the main reasons for choosing Cirtec as our partner for the Stereax factory is obviously they are in America, for their main manufacturing process. As they are using us for one of the stages of that manufacturing process, we have an ability to pass materials through with very little impact of that. That really goes back to the U.S. looking to help themselves, but by choosing the right partner in the right market, we've been able to make sure we're in a position where we're not impacted by that.
Obviously, as we scale up Goliath or the defense opportunities and look for any further partners, what the global situation is at the time, we'll try and position ourselves so that we are as protected as we possibly can. We don't have a crystal ball to understand what happens in the longer future. We'll look for mitigations as we go forward.
Next question: do you currently have the manufacturing capability to meet the demand for Stereax needs in 2030 and beyond? What is the level of capital investments that are needed by Ilika to meet the demand? I would say to that of course, we've transferred manufacturing capability to Cirtec, and the capacity that we have in place with that equipment that's now installed in the U.S. will meet our needs for the forthcoming period. When we max out that capacity, which actually I hope is sooner rather than later, actually it would be Cirtec that would invest in that equipment for larger volumes of manufacturing. The only piece that we have retained is our ability to make electrodes, so actually the cathode electrode, the positive electrode within our Stereax batteries. We've still got the piece of equipment for doing that here in the U.K.
That has significant capacity, but in due course we may replace that. That is not a particularly significant piece of investment that is going to make a radical change to our financial profiles. Next question is an interesting one. How are you as a company dealing with your battery being used in robotics? I remind myself of a newsletter where a robot was not allowed to travel with its owner in the plane because of the danger with lithium-ion batteries, which are now the standard. Is this a market you're looking for ahead in the coming future? Yeah, airlines are very nervous about lithium-ion batteries on board. If you've flown recently, you will realize that. You get asked if you're carrying auxiliary power packs, and you're actually not allowed to put batteries into the hold.
If you've got an e-bike, you're not allowed to take that on board because of the risk that the battery poses. There's a lot of interest in enhancing the safety profile of lithium-ion batteries. That's very interesting for us because, of course, we specialize in a technology that has got an enhanced safety profile. Some of you will have seen the videos that we've published of our 2 Ah cells on YouTube that show that the batteries are more resilient to penetration tests. This is part of our mission, that ultimately we make batteries that are safe for air travel, and use on public transport, and we remove this risk that users of lithium-ion batteries are currently having to manage.
We've got a question here. Are modules and packs for the cells going to be provided by Ilika or will the licensees create them? Have the materials to be used been decided? I think going to the theme that we've talked about already, we know to stick to our strengths. We would look for the licensees to be integrating those into packs and modules. However, in some of the smaller ops, certainly on the automotive scale, we would be looking for that to happen at a licensee.
At the smaller opportunities in and around the defense and autonomous vehicle sectors that Graeme has talked about, we would certainly look to collaborate with experts in that field and have already had a number of conversations with those people to make sure that the products that we are producing in terms of our 10 Ah is applicable and how they would fit into those applications. Once again, we wouldn't look to delay ourselves and go backwards. We'd need to draw on the right expertise to make sure we were staying relevant. In terms of the materials, certainly the materials we've identified for that 10 Ah prototype are decided that we would use for commercialization, although as an R&D company, we continue to obviously look to optimize and look for improvements wherever we possibly can. Always one eye open to the future.
What are the lead times for new battery formation and testing equipment, and are there third-party facilities that could be used in the interim? Actually, we pride ourselves in our ability to plan ahead. The reason that we specified that we were going to use some of the funds that we raised in the last placing for the battery formation and testing equipment is to make sure we've got sufficient equipment in place for when we need it. We of course have equipment already, and that's enough to deal with the levels of production that we've got. As demand starts to ramp and we define this 10 Ah MVP, we need to increase that capacity.
We probably won't need to go to third party. In order to access external capacity unless we're totally overwhelmed, in which case we might be ringing up our friends at facilities like UKBIC that has the ability to be able to do that. Actually, that's a great segue into the next question. Are the facilities at UKBIC capable of producing a complete 10 Ah Goliath battery from start to finish? Is it cost-effective, or is it a cost-effective alternative should demand for the 10 Ah batteries exceed Ilika's pilot line capability? Yeah, the facilities at UKBIC are capable of producing a complete 10 Ah Goliath battery from start to finish.
Well, whether it's cost-effective or not depends a bit on the batch size, and also whether the application would tolerate those costs. It's certainly a capability that we are aware of and we'd be happy to work together with UKBIC again, should the commercial and business case justify it.
Next question here is, "The benefits of grant funding are obvious. However, the government and its affiliates are generally not viewed as dynamic in the same way a private company is answerable to its shareholders. Given Ilika's university roots, is it staying within its comfort zone of pursuing a grant at every step? I say this in the context of every project having a 12-month duration, irrespective of what it actually seems to involve." We are absolutely pursuing commercial interactions and conversations with non-grant bodies. Where you see a lot of the news flow happening around grant funding is obviously because it's publicly funded information of money, that information becomes public and therefore has to be published, whereas behind-the-scenes collaborations or conversations with a lot of potential customers or collaborators tends to be under a NDA.
We're not in a position to make as much noise about those, if any at all. Please be reassured that we are actively and very rapidly trying to secure various conversations across the broad range of our products, but they tend to be more tightly controlled in terms of what we are able to put into the public domain.
Does the Brompton JDA help you to develop an MVP for scooters and maybe drones as well? The reality is that there are lots of different applications for batteries. You're absolutely right that there is a big demand for batteries for e-scooters and, of course, drones, land, sea, and air. What's key for us actually is to just evaluate the business case for each of these different applications in turn, and to work out what product would be required in order to realistically develop the applications. Actually, you often find that the duty cycles for different applications require different battery designs. What we've got to avoid is becoming jacks of all trades, and masters of none.
What we'll probably do, is we will identify one, maybe two, market opportunities that are a really good fit for our 10 Ah prototypes and focus on them, deliver them, generate commercial revenues, and then use them as a platform to diversify into other markets in due course. We've always got to avoid going head to head with less expensive Chinese, principally, manufactured batteries that we're not differentiated with. We always choose the applications very carefully so that we can emphasize the USPs of our product and make sure that we can sell the product for a profit margin.
That's a good segue into a question here, "What are the risks from China given their reputation for copying our technologies already?" Obviously, that's a risk that we discuss, IP leakage, and therefore we make sure that all of our activity, where possible, is protected by patents and trade secrets. We employ external IP experts, lawyers, to make sure that we are looking after and protecting as much as possible everything that we have. We're also using trade secrets where putting information into an IP application might give people enough of a clue on what to copy there, using trade secrets so it's not in the public domain at all. Our choice of partners to talk to is clearly carefully selected.
We do receive inbound inquiries from the wider Asian market, including China itself. We are very careful in what we have as conversations with those individuals. That's where, as we've talked in previous presentations, our markets are primarily focused around the Western hemisphere in terms of the European and U.S. market. Although, clearly the Korean market, and maybe outside of Greater China, is an opportunity for in the future. We certainly wouldn't look to do anything there in the near term to make sure that we're giving as much protection to our technology for it to be out in the market.
Here's a great one. "The government announces X billions for Ilika-related fields, but Ilika itself receives relatively tiny amounts. Given the potential for Ilika to redefine aspects of automotive and defense applications, why is more money not forthcoming?" Well, we would be delighted actually to receive more grant funding. The reality is that the government agencies that are responsible for dispersing government grants are under an obligation to run competitions for companies that wish to access that funding. Actually, the amounts that are on offer are typically massively oversubscribed. Sometimes there's only a 10% chance, actually, that a company can secure funding that's made available. We have to choose which competitions we enter very carefully. We've got a pretty experienced grants team that has been very successful over the years and continues to be successful.
We try and make sure that when we put in for a piece of grant funding, that it's a compelling proposition, and one that will score highly. Otherwise, we end up spending an awful lot of time writing applications that wouldn't go anywhere. Yeah, grant funding is very important and the agencies responsible for dispersing those funds are doing their very best to make sure it's dispersed on an egalitarian basis and on merit. There's a clarification here, actually, from an earlier question. "With the question about robotics, I meant the current future vision on robotics as a business. Industrial robotics, autonomous robotics, human-like robotics." Yeah. That's a good question. There is actually a massive diversity of robotic applications. Depends what you mean by a robot and there are lots of uncrewed vehicles and autonomous robots that all have slightly different duty cycles.
It comes a bit back to the question on what should we be developing Goliath Batteries for? Some applications require a really long cycle life. Some are really power-intensive and require batteries that will release their energy very rapidly. Some are very low-power robots that just require a really high energy density so that the robot can operate for a long period of time, sometimes in a sort of sleep mode. We're evaluating all of these. These are really important applications of the future, whether we like it or not, actually. There's some concerns about the rise of robotics, but they are here to stay and we are currently evaluating them very closely.
I think we're just about out of time, so we'll take the opportunity to look at any other questions that have been submitted that we weren't able to get to, and we will do our best to answer them if we can.
That's great. Thank you for answering all those questions you can from investors. Of course, the company can review all questions submitted today, and we'll publish those responses on the Investor Meet Company platform. Just before redirecting investors to provide with their feedback, which I know is particularly important to the company, Graeme, could I please just ask you for a few closing comments?
Well, many thanks for the exciting Q&A interaction today. I really value the opportunity to be able to engage and talk through some of your ideas and concerns. As Jason said, we will follow up with the few remaining questions that we haven't managed to get around to verbally today.
That's great. Thank you for updating investors today. Can I please ask investors not to close this session, as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This may take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team, we'd like to thank you for attending today's presentation. Good afternoon to you all.