Apollo Power: Credit, leases and dilution, the real funding test
The main article framed the backlog-to-cash test. This follow-up shows that in 2025 Apollo Power covered about 76% of its all-in cash use through equity issuance and warrant exercises, while lease cash, pledged deposits and an expensive but undrawn credit line still limit real flexibility.
The funding test, not just the backlog test
The main article argued that Apollo Power already has demand, but that 2026 will be decided by whether backlog turns into revenue and cash. This follow-up isolates the financing layer of that same thesis: not how many orders came in, but how 2025 was actually funded, how much cash disappeared after leases and investment, and what an undrawn credit line is really worth.
The core point is simple: in 2025 the business did not fund itself. Cash flow from operating activities was negative NIS 55.3 million, investing cash flow was negative NIS 13.7 million, and lease-principal repayments added another NIS 6.4 million of contractual cash use. That is already an all-in cash use of roughly NIS 75.3 million before external funding.
Against that gap, the main source was equity. Apollo raised about NIS 43.0 million net from share and warrant issuance and another NIS 14.4 million from warrant exercises into equity. In other words, about NIS 57.5 million, or roughly 76% of the year’s all-in cash use, came from equity rather than from the business. Including grants received brings external non-debt funding to about NIS 59.3 million, and even then cash and cash equivalents still fell by NIS 15.7 million.
The all-in cash bridge
The framing matters here. This is not a normalized cash-generation exercise before discretionary uses. It is a financing-flexibility test, which means looking at the real cash that left the system in 2025: operating burn, investment, and lease-principal repayments.
| Item | 2025, NIS million | What it means |
|---|---|---|
| Operating cash flow | (55.3) | The business still consumes cash at a very heavy rate |
| Investing cash flow | (13.7) | Even after cost focus, the company is still funding operating build-out |
| Lease principal repayments | (6.4) | Contractual cash use that sits outside investing cash flow |
| Net equity inflows | 57.5 | The main source that closed most of the gap |
| Cash and cash equivalents at year-end | 21.5 | Down materially from NIS 37.2 million at the start of the year |
The important read of this bridge is that 2025 was not a short bridge year on the way to self-funding. It was a year in which Apollo burned more cash than the business generated and covered most of the shortfall through the capital market. That is not automatically wrong for a commercialization story, but it changes how investors should read every liquidity number on the balance sheet.
There is also an important nuance in the headline liquidity balance. Apollo ended 2025 with NIS 21.5 million of cash and cash equivalents and another NIS 17.7 million of bank deposits. On first read that looks like roughly NIS 39.1 million of liquidity. Not all of it is equally free.
Leases and pledged liquidity
The main contractual burden still sits in leases. Lease liabilities stood at about NIS 72.5 million at year-end, including roughly NIS 7.2 million of current maturities. The discounted maturity schedule makes the point clearly: the burden does not disappear after the next twelve months. It stretches far beyond them.
This is where the cash framing has to stay precise. Lease principal repayment in 2025 was about NIS 6.4 million, and that is the figure included in the all-in cash bridge above. But if the question is the full cash burden of leases, principal is only part of the picture. Apollo disclosed cash used for lease transactions of about NIS 10.3 million, which includes roughly NIS 3.9 million of lease-related interest and indexation. Anyone looking only at principal is understating the drag on cash.
There is some relief, but it is small. Following the Yokneam sublease, the company recognized finance-lease receivables of about NIS 1.43 million, of which roughly NIS 0.97 million is current. That is helpful, but it is still minor against lease liabilities of more than NIS 72 million. This is not an offsetting structure. It is a limited local cushion.
The deposit line also needs a closer read. Of the NIS 17.7 million of bank deposits, about NIS 4.1 million were presented as pledged deposits. The pledges back bank guarantees tied to lease agreements and other obligations, and the notes also disclose a pledged deposit supporting a credit-card facility. So while the balance sheet shows sizeable deposits, not every shekel in that line is available for operating flexibility on demand.
Another detail matters at the parent-company level. At year-end, only about NIS 0.5 million of cash and cash equivalents were held in the parent company itself, versus about NIS 23.2 million a year earlier. At the same time, the credit facility sits at SolarPaint, not at the listed parent, and it also comes with restrictions on dividends and payments upstream. So even within group liquidity, accessibility is not uniform.
The credit line: available, but not cheap
It is easy to see a NIS 40 million bank line and check the funding box. That is too superficial. The line was indeed extended in March 2026 through February 26, 2027 without changes to its other terms, but those terms matter.
The facility is meant for working capital. In early March 2025 it was extended through March 2026 but reduced to NIS 25 million, and in May 2025 it was restored to NIS 40 million. The pricing, however, is not flat: up to NIS 10 million, if drawn, carries interest at prime plus 1.2%; the remaining portion, if drawn, carries interest at prime plus 9%. That is no longer a neutral backstop. It is funding that can become very expensive exactly when the company may need it most.
The line is also not a free option. Apollo’s 2025 finance expenses included about NIS 297 thousand of non-utilization fees for the facility. So the company paid to keep the line available even while drawing nothing from it. That may be a reasonable insurance premium, but it also means the alternative liquidity source already has a cost before actual use.
The quality of the collateral and restrictions matters just as much. The facility is supported by a parent-company guarantee, a first-ranking floating charge over all SolarPaint assets, a fixed charge over unissued share capital and goodwill, and a fixed charge over rights vis-a-vis VW up to NIS 60 million. SolarPaint also undertook financial covenants, shareholder-loan subordination, and restrictions on dividends or payments to the parent unless specified equity tests are met.
The company stresses that no amounts had been drawn as of the reporting date or the financial-statement approval date, and that SolarPaint met the financial covenants. That is true. But it is also the point: the facility removed the immediate cliff on paper, not the economics of real utilization. If 2026 requires meaningful drawdown, pricing, collateral and restrictions move from footnote status to the center of the thesis.
Dilution: 2025 was financed with equity
The simplest number in this story is also the hardest one to ignore. Issued and paid-up shares increased from 63,990,522 at the end of 2024 to 78,652,901 at the end of 2025. That is an increase of about 14.7 million shares, or roughly 22.9% in a single year.
The mix matters. The July 2025 private placement added 2.515 million shares and brought in about NIS 10.7 million net. The December 2025 public offering added 8.694 million shares together with 4.347 million Series 9 warrants and brought in about NIS 32.4 million net. On top of that, warrant exercises added another 3.453 million shares and about NIS 14.4 million.
So the company did not just raise capital. It materially expanded the share base to finance the year. That is not a technical detail. It is the economic center of the 2025 funding story. When operating activities burn NIS 55.3 million and net equity inflows contribute NIS 57.5 million, shareholders effectively funded most of the year instead of the business funding itself.
It is also worth remembering that the December 2025 raise did not end with common shares alone. Apollo also issued 4.347 million Series 9 warrants exercisable through December 2027 at NIS 4.75 per share. That can become another equity layer if the share price supports it, but it also means the 2025 liquidity fix left behind another potential dilution leg.
Bottom line
What this follow-up really shows is not an immediate liquidity shortage, but a funding structure whose quality has not yet been tested under real draw conditions. At the end of 2025 Apollo Power had sizeable cash, cash equivalents and bank deposits relative to its scale, and it had a NIS 40 million credit line that was extended after the balance-sheet date. But some of that liquidity is pledged, leases still drain real cash, and the undrawn bank line carries both a cost and a materially more restrictive structure if used.
So the real question is not whether the company is "covered" for the next few quarters. The real question is whether 2026 becomes the year in which customers and projects start funding working capital, or whether Apollo shifts from one equity-financed bridge year into a mix of further dilution and more expensive secured borrowing.
The continuation thesis in one line: in 2025 Apollo bought time mainly through the capital market. For the story to improve materially, 2026 has to prove that the extra time buys cash self-sufficiency, not just another round of financing.