Israeli cleantech company GenCell Energy (TASE: GNCL), in which entrepreneur Benny Landa is the biggest shareholder, is implementing a streamlining plan, "In order to improve its capital flow situation and financial strength." The company has reported a further scaling down of its work force, a reduction in management and general expenditure, a cut in R&D spending and an increase in use of outsourcing services. In 2025, the company will reduce the rent it is paying.
The company estimates that this streamlining plan will save NIS 5 million in annual spending, which will help it cope best with current and future challenges.
At the same time, GenCell reports that it is cutting the salaries of the CEO and chairman. Chairman Asher Levy is taking a voluntary pay cut of 15% from July for 18 months, while CEO Rami Reshef's salary will also fall by 15% for the same period. Levy's salary cost (including capital remuneration) in 2023 was $137,000 for a 20% position. Reshef's salary costs was NIS 616,000 for a full time position. Reshef founded the company together with partners in 2011.
GenCell develops and manufactures fuel cells as an energy source for producing electricity. These fuel cells operate on hydrogen produced from ammonia in a relatively cost-savings and cheap process that is non-polluting. The company's products are used as a backup for the electrical systems of large companies. GenCell held its IPO during the 2020/2021 tech boom at a company valuation of about NIS 800 million after money, but today has a market cap of just NIS 68 million.
GenCell is not the only Benny Landa company to encounter financial difficulties recently after an Israeli court issued a temporary stay-of-proceedings for lab-grown diamond company LUSIX earlier this week.
Published by Globes, Israel business news - en.globes.co.il - on August 27, 2024.
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