Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

Xeros Technology Group PLC surges as sales accelerate

It is still early days for the company's patented laundry technology but the number of early adopters is increasing fast
Xeros Technology Group PLC surges as sales accelerate
The magic beads

Xeros Technology Group PLC (LON:XSG) shares rose 9% on Tuesday Morning after interim results showed a sharp increase in sales for the company's innovative laundry systems.

The company has developed a patented polymer bead cleaning system that significantly reduces water, energy and chemical use while also delivering a superior cleaning result, but has a challenge on its hands supplanting ages-old tried & trusted technology.

Results for the five months to the end of 2015 – the company is in the process of changing its year-end – indicate that the number of early adopters is growing apace, with the group's earned income rising to £744,000 from just £95,000 in the same period of 2014.

As at 31 December 2015 contracted future revenues amounted to £2.1mln (2014: £0.7mln) and average contract length remaining is 77 months (2014: 68 months).

The company is accelerating the roll-out of its Commercial Laundry offering, having racked up 56 commercial washing machine installations in the five month period and a further 38 in the first two months of 2016, bringing the total up to 200.

“The roll out of Commercial Laundry continues at a good pace. We are now installing machines at an approximate rate of one per working day and expect this rate to progressively increase,” said Mark Nichols, chief executive of Xeros.

The technology is not just applicable to the laundry market; the company is working on full-scale leather processing trials in a leading European leather tannery, while detailed studies are in progress to analyse other potential uses for its technology.

"In Leather Processing, our full scale trials are on track and are scheduled to be completed around the middle of the year. We anticipate that these trials will show that our polymer beads, which were specifically designed for this application, deliver economic, operational and sustainability improvements.

"Studies to identify new potential applications are also progressing on schedule and are providing further evidence that we possess a platform technology," Nichols added.

The company's operations are not yet at a scale that would generate a profit, and it posted an interim pre-tax loss of £5.61mln versus a loss of £3.84mln in the same period of the previous year.

The group continued to invest heavily in its research & development programme, with R&D costs up to £1.9mln in the latest period from £0.8mln the year before.

The group said it expects cash use to continue to accelerate over the coming years as it continues to invest in R&D and roll out its commercial laundry systems.

In the five-month period to the end of 2015 net cash outflow totalled £5.7mln, versus £4.3mln the year before.

At the end of the year the company had cash of £49.5mln, up from £25.3mln at the end of 2014, following a £40mln fund-raising in November.

View full XSG profile View Profile

Xeros Technology Group Timeline

Related Articles

itaconix.jpg
May 31 2017
“We are effectively a new business,” says chief executive Dr Kevin Matthews
Colourful plastic tubes
May 03 2017
This is a business seemingly impervious to cyclical blips - defensive almost - though management are focused on growth and targeted acquisitions.
molecular makeup of graphene
August 22 2017
Its shares, up 16% in the year to date, nudged a further 5% higher Tuesday after it unveiled an outline agreement with Rogers Advanced Composites

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2017

Proactive Investor UK Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use