Kibo Energy

kibo energy plc

Kibo Energy PLC

Kibo Energy PLC is  is focused on a rapid transition to renewable energy, the related reserve power markets and critical metals (gold / green metals / battery metals). Kibo Energy (KIBO.L) is listed on the AIM market in London and the AltX in Johannesburg.

Kibo Energy has a significant 55.42%  in UK publicly listed company, Mast Energy Developments Plc, (MED.L) which is building a portfolio of flexible energy projects in the UK. This has given Kibo an entry to the UK reserve power market. Kibo Energy has entered the UK waste-to-energy (WTE) market directly and in time it plans to introduce the reserve power market model and WTE model to its operations in Africa. Kibo Energy is exposed to the critical metals (gold, green metals / battery metals) via its Katoro Gold Plc (KAT.L) stake (25.37%).  Katoro Gold is an AIM-listed company with projects in South Africa.

Kibo Energy also has significnat stakes in a series of sub-saharan coal-to-power projects, which it is tranistioning to waste-to-energy (WTE) feedstocks or preparing for orderly sale.

  energy@acfequityresearch.com

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Value range – 26/10/2021

Intrinsic Price (GBp) 1.55
Value Range Low (GBp) 1.51
Value Range High (GBp) 1.59
Implied MCAP (m) £49.90
Implied EV (m) £50.50
AIM KIBO
Financial YE 31-Dec
Currency GBP

Business Activity

Renewable Energy and Critical Metals

Key metrics

Close Price (GBp) 0.22
MCAP (m) £5.3
Net Debt (cash) (m) £0.6
EV (m) £5.9
52 Wk Hi 0.56
52 Wk Lo 0.17

Key ratios

(Net Cash) /Shareholder Equity % 11.31%
FX Rate USD/GBP 0.72

Energy Sector Research
AiM Market Index
Analyst Team
+44 20 7419 7928
energy@acfequityresearch.com

kibo energy multiples table

Transition to Renewable / Reserve Power

Kibo Energy Plc (KIBO.L: AIM) is a portfolio company with stakes in energy and critical metals assets. In order to be highly conservative, we exclude Kibo’s sub-saharan power assets from our valuation, leaving 7x upside. Kibo is transitioning rapidly to a renewable (WTE) and reserve power (symbiotic with renewable power generation) plus critical metals exploration business. Kibo’s assets are in the UK (reserve power) and sub-saharan Africa (power and critical minerals assets). Both UK and South African power markets are subject to strong growth drivers over the next decade. Critical metals exploration and production is a global market subject to super cycle pricing dynamics. Our aggressively conservative valuation scenario suggests an ‘instant’ 150% upside is available – MAST.L stake valued at 2.5x Kibo MCAP.

77.2%

MAST.L contribution to our KIBO.L NPV %

22.8%

KAT.L contribution to our KIBO.L NPV %

Financial Projections – Kibo all Assets

2021E-2022E

+295%

Revenue 2022E £2m up 295% vs. £0.5m 2021E

+175% 

EBITDA 2022E £0.8m up 175% vs. £0.3m 2021E

+19% 

Net Income (unadjusted) 2022E £2.3m up 19% vs. £1.9m 2021E

+285% 

Net Cash from Operations 2022E £2.3m up 285% vs. £0.6m 2021E

Renewables transition to WTE, reserve power, battery metals;

Kibo revenue run-rate 2022E £2m p.a.;

3 UK reserve power revenue streams to come online 2Q22E;

Energy portfolio 1,255 MW capacity near commercialization / sale;

150% ‘instant’ upside – MAST.L stake valued at 2.5x Kibo MCAP.

FTSE AiM vs. KIBO  (green line) price relative.

Operational Strategy – Transition

Kibo Energy Plc (KIBO: AIM) is a portfolio company transitioning to a renewables, reserve power and critical metals business – it has three areas of focus in the new strategy –UK reserve power and Waste to Energy (WTE) generation; South Africa renewable power generation via Waste to Energy (WTE) and Southern African critical metals production. Assets that no longer fit into the renewables and critical metals strategy will be converted to renewable feedstocks (WTE) or prepared for orderly sale.

Kibo’s operations primarily revolve around signing PPAs and getting plants ready for production. Additionally, the company is also focused on actively progressing various funding and commercial opportunities to augment its capacity and expand its project portfolio via acquisitions or participating in new tenders.

UK Renewable and Reserve Power Driver

Green energy transition to support demand for reserve power plants. The UK is transitioning from fossil fuels to the use of more renewable sources of energy. The renewable sources such as wind and solar are providing an ever-increasing amount of power to the UK grid.

UK’s Energy Mix (Apr-Jun 2018) 

+44%

Fossil fuels

+31.6% 

Renewables

+21.7%

Nuclear

Kibo Energy valuation catalysts

Our forecasts 2025E pre-suppose Botswana coal et al come on-line – however we exclude all sub-saharan power assets from our highly conservative Kibo valuation range. We focus instead on Kibo’s MAST and KAT stakes.

Closing of liquid asset value gap

Start of 5.2 MW export of reserve power at Bordesley +/or 9 MW exports from Pyebridge;

Commercialisation of WTE

Commercialisation of critical metals exploration in South Africa

Asset One

NPV MAST.L (55%) £39m

Asset Two

NPV CAT.L (25%)  £11m

Asset Three

Excluded from our NPV. Potential upside sub-saharan power – £75m

To see the latest press releases visit Kibo Energy website.

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