EQTEC plc has issued a legal claim against Logik Developments Limited and its subsidiary Logik WTE Limited in the London Circuit Commercial Court. The claim is in connection with payments made by EQTEC and its subsidiaries and due to them in relation to the Deeside project, as well as for breach of the share purchase agreement between Logik Developments and Deeside WTV. The total amount claimed by EQTEC is approximately £4 million. EQTEC has attempted to engage Logik in discussions to resolve the matter but has been met with rejection or non-compliance. As a result of these legal proceedings, EQTEC will no longer receive the expected revenue from the Deeside project in the current financial year.
In addition to the legal claim, EQTEC has updated its revenue forecast for 2023. The completion of front-end engineering design work for the France MDC project by French client Idex has been rescheduled to December 2023, delaying anticipated revenues from this project. Furthermore, client projects in Belišće, Livadia, and Wilseyville are experiencing delays in securing full funding, pushing back expected revenues from Q4 2023 to 2024. As a result of these events and the company's rationalization of other projects with unmitigated risks and liabilities, EQTEC has revised its overall revenue forecast for 2023 to €2-3 million.
The reduction in forecast revenue is part of EQTEC's strategic shift away from high-risk development work with unconfirmed funding and unqualified partners. The company aims to focus on well-qualified, pre-funded projects owned by top-tier developers or owner-operators. This shift is seen as essential to refocusing the company on its core capabilities of advanced process engineering and core technology delivery. EQTEC will provide further details on its strategic shift in its 2023 interim results, which are expected to be published by the end of September 2023.
David Palumbo, CEO of EQTEC, expressed frustration with the need to resolve issues with Logik instead of progressing the Deeside project. He also criticized Logik for attempting to go it alone and ignoring their common commitments to the project. Palumbo stated that EQTEC has consistently supported the project and made investments to keep it moving forward, but Logik's unwillingness to engage in discussions has jeopardized the project and forced EQTEC to take legal action to protect the company from bearing the cost of Logik's actions.