Renewable energy companies that actually produce profits are thin on the ground — but not in Co Durham, where Consett’s Romag has flourished in the ashes of the town’s steel industry. The AIM-listed company has capitalised on development grants and the region’s clean air, once tinged red with iron oxide particles, to carve out a niche as a maker of specialist glass. Its initial focus was on blast and bullet-resistant glass, but latterly Romag has turned to building-integrated photovoltaic (BIPV) glass: solar cells contained within laminates that are produced for architectural use. BIPV showed stellar growth within yesterday’s full-year numbers, up 300 per cent and accounting for nearly one third of total sales — and this is where investor interest lies.
Estimates suggest that the BIPV market will see 40 per cent annual growth in the next five years, helped by planning rules and tariffs that encourage renewable power generation. Romag has a foothold in France and Spain, Europe’s early adopters, and, through a tie-up with BP Solar, is picking up clients in Asia. At 133½p, the shares, trading at 27.6 times 2008 forecasts, are not cheap but should look better value if, as expected, new manufacturing fosters upgrades to forecasts. Worth a look.