07:00 Wed 11 Dec 2019
Kromek Group PLC - Interim Results
("Kromek" or the "Group")
Interim Results
Kromek (AIM: KMK), a worldwide supplier of detection technology focusing on the medical, security screening and nuclear markets, announces its interim results for the six months ended
Financial Summary
· Revenue increased by 43% to
· Product sales accounted for 82% of total revenue (H1 2018/19: 78%)
· Gross margin was 58% (H1 2018/19: 67%; FY 2018/19: 57%)
· Adjusted EBITDA* was
· Loss before tax was
· Gross cash and cash equivalents at
*Adjusted EBITDA defined as earnings before interest, taxation, depreciation, amortisation and share-based payments as detailed in the Financial Review below
Operational Summary
· Record H1 revenue driven by delivery of high value, multi-year contracts with commercial and large government customers worldwide across nuclear detection, medical imaging and security screening
· Substantial expansion programme implemented at
· Significant commercial traction with D3S family of products:
o Expanded sales team and rapid channel development resulting in the D3S platform now having been sold in 22 countries
o Received and has successfully delivered orders of
o Further contracts won from US government and
· Commenced delivery on a significant
· Substantial increase in capacity in detector manufacturing and introduction of process automation resulting in increased throughput and efficiency in the US facility, which is delivering on substantial medical contracts
· 3 new patents were filed and 8 were granted during the period
Outlook
· Entered H2 2019/20 with increasing commercial momentum: Kromek signed multi-year contracts totalling c.
· Unchanged outlook for FY 2019/20: on track to achieve revenue and EBITDA profit in line with market expectations
Dr
"Kromek entered the second half well-positioned to report its highest ever full year revenues as delivery of high value, multi-year contracts continues to ramp up. We are delivering on contracts worth nearly
For further information, please contact:
|
|
| +44 (0)1740 626 060 |
Cenkos Securities plc (Nominated Adviser and Broker) |
|
| +44 (0)20 7397 8900 |
|
|
Harry Chathli | +44 (0)20 7618 9100 |
Analyst Presentation
About
The Group's products provide high resolution information on material composition and structure and are used in multiple applications, ranging from the identification of cancerous tissues to hazardous materials, such as explosives, and the analysis of radioactive materials.
The Group's business model provides a vertically integrated technology offering to customers, from radiation detector materials to finished products or detectors, including software, electronics and application specific integrated circuits ("ASICs").
The Group has operations in the
Currently, the Group has over one hundred full-time employees across its global operations. Further information on
Overview
Kromek achieved the highest first half revenue in its history at
During the period, the Group implemented a substantial expansion programme at its
Medical Imaging
Kromek continued to deliver on its contracts and win new orders in the medical imaging markets across its key segments of SPECT, bone mineral densitometry ("BMD") and gamma probes. In particular, Kromek commenced delivery on one of its most significant contracts to date, which had been awarded in H2 2018/19, to provide an OEM customer with CZT detectors and associated advanced electronics to be used in its state-of-the-art medical imaging systems. The contract is expected to be worth a minimum of
Also during the period, the Group advanced towards achieving clinical validation of its CZT-based SPECT detector system under the contract signed in 2014 with an established manufacturer of X-ray diagnostics and analysis equipment. The Group's management believes this system will significantly enhance the identification and management of diseases such as cancer and Parkinson's.
Kromek is collaborating with its medical imaging partners to support them in leveraging the advances in SPECT imaging, with a focus on reducing required patient dose, exam time and broadening the application of molecular imaging. This includes the Group's work with the
Nuclear Detection
Kromek continued to experience increasing demand for its D3S platform, which is attracting business interest across the globe - and has now been sold in 22 countries. This is supported by the expansion of the D3S sales team and distribution network, with new channels being regularly put in place.
In particular, Kromek was awarded a strategically significant contract, worth
The US government awarded Kromek a new and an extension contract worth over
· The
· The US government's
The D3S platform was used in active deployments and field-tests in multiple locations of strategic importance and high risk across the US,
Post period, Kromek won a competitive tender to provide its D3S platform to a national civil defence agency of a European country under a contract worth up to
In the nuclear markets, Kromek's portfolio also includes a range of high-resolution detectors and measurement systems used for civil nuclear applications, primarily in nuclear power plants and research. During the period, this area of business continued to gain traction, receiving orders from both existing and new customers. The Group has also appointed new distributors in key geographical markets, furthering the channel development strategy on a global basis.
Security Screening
In security screening, Kromek continued to provide its OEM and government customers with components and systems for cabin and hold luggage scanning applications. This includes commencing delivery on the
The Group also reached a key milestone with another OEM customer in the security screening market, which achieved the highest level of European liquid explosive detection certification for cabin baggage for its scanner that is based on Kromek software and detectors. This certification enables for commercial deployment of the product.
Manufacturing Facilities and R&D
During the period, Kromek implemented a substantial expansion programme at its
The expansion programme, which is on track to be completed in H2 2019/20, will increase the Group's CZT manufacturing capacity in the
The implementation of the expansion programme also demonstrates the scalability of the Group's production as Kromek 'industrialises' the CZT manufacturing process. In addition, Kromek invested in significantly increasing process automation at its facilities in both the
Kromek continued to develop its new technology pipeline, with its R&D efforts focused on the development and enhancement of products and platform technologies that form elements of Kromek's product roadmap, particularly for near-term commercial opportunities, and to enable the Group to maintain its leading market position. Kromek worked on both externally and internally funded R&D activities, with the proportion continuing to transition away from externally funded R&D projects as its technologies are increasingly commercialised. In addition, Kromek's R&D efforts were focused on value engineering to increase cost efficiencies to enable the Group to offer competitively priced products whilst maintaining margins.
Kromek's externally funded work is primarily in the areas of medical imaging and nuclear detection. In nuclear detection, the focus is on the D3S platform to further reduce the size, weight and power consumption of detectors and increase their immunity to environmental conditions.
During the period, three new patents were filed and eight patents were granted.
Financial Review
Revenue for the six-month period ended
Revenue Mix | H1 2019/20 | H1 2018/19 | Full year 2018/19 | |||
| £'000 | % share | £'000 | % share | £'000 | % share |
Product | 4,382 | 82% | 2,865 | 78% | 12,060 | 83% |
R&D | 951 | 18% | 820 | 22% | 2,457 | 17% |
Total | 5,333 |
| 3,685 |
| 14,517 |
|
Gross margin for the period was 58% compared with 57% for FY 2018/19, reflecting a similar revenue mix. The gross margin in H1 2018/19 of 67% was due to the higher proportion of R&D revenue. As noted at the time, this was disproportionately high due to the US factory relocation throughout that period. Gross profit increased by 25% to
Operating costs increased by
| H1 2019/20 (Unaudited) | H1 2018/19 (Unaudited) | Full Year 2018/19 (Audited) |
| £'000 | £'000 | £'000 |
|
|
|
|
Loss before tax | (2,653) | (2,133) | (1,270) |
EBITDA adjustments:- |
|
|
|
Net interest | 311 | 47 | 364 |
Depreciation | 544 | 445 | 879 |
Amortisation | 1,087 | 1,040 | 1,806 |
Share-based payments | 100 | 48 | 195 |
Adjusted EBITDA* | (611) | (553) | 1,974 |
*Adjusted EBITDA is defined as earnings before interest, taxation, depreciation, amortisation, other income and share-based payments. Adjusted EBITDA is considered a key metric to the users of the financial statements as it represents a useful milestone that is reflective of the performance of the business as a result of revenue growth. Share-based payments are added back when calculating the Group's adjusted EBITDA as this is currently an expense with a zero direct cash impact on financial performance.
Investment in product development was
Cash and cash equivalents at:
·
·
·
The net decrease in cash and cash equivalents in the six months ended
As noted in the FY 2018/19 results announcement on
With the exception of fluctuations in foreign exchange, the proportion of AROC has remained static, with no further increase in the position and no additional contract related costs incurred at the end of
Outlook
Kromek entered the second half of 2019/20 well-positioned to report its highest ever full year revenues as the Group continues to ramp up delivery of its high value multi-year contracts.
The Group's products continue to gain traction in all its business segments and Kromek is strengthening its relationships with existing customers as well as enhancing its reputation among potential customers. Kromek is at the early stages of delivering contracts worth approximately
As a result of this, the Group has visibility of 90% of expected revenue for FY 2019/20 based on delivery of the contracts already won and supported by a strong and increasing pipeline. The Board expects to deliver significant revenue growth and EBITDA profit for full year in line with market expectations.
Consolidated condensed income statement
For the six months ended
|
|
| Six months ended 31 October 2019 £'000 |
| Six months ended 31 October 2018 £'000 |
| Year ended £'000 |
|
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
|
|
|
|
|
|
|
|
| Note |
|
|
|
|
|
|
Continuing operations |
|
|
|
|
|
|
|
Revenue | 4 |
| 5,333 |
| 3,685 |
| 14,517 |
Cost of sales |
|
| (2,240) |
| (1,205) |
| (6,208) |
|
|
|
|
|
|
|
|
Gross profit |
|
| 3,093 |
| 2,480 |
| 8,309 |
|
|
|
|
|
|
|
|
Distribution costs |
|
| (190) |
| (78) |
| (184) |
Administrative expenses (including operating expenses) |
|
| (5,245) |
| (4,488) |
| (9,031) |
|
|
|
|
|
|
|
|
Operating loss |
|
| (2,342) |
| (2,086) |
| (906) |
|
|
|
|
|
|
|
|
Finance income |
|
| 45 |
| 129 |
| 155 |
Finance costs |
|
| (356) |
| (176) |
| (519) |
|
|
|
|
|
|
|
|
Loss before tax |
|
| (2,653) |
| (2,133) |
| (1,270) |
|
|
|
|
|
|
|
|
Tax | 5 |
| 389 |
| 480 |
| 987 |
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
| (2,264) |
| (1,653) |
| (283) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Losses per share |
|
|
|
|
|
|
|
-basic (p) | 7 |
| (0.7) |
| (0.6) |
| (0.1) |
-diluted (p) |
|
| (0.7) |
| (0.6) |
| (0.1) |
Consolidated condensed statement of comprehensive income
For the six months ended
| Six months ended 31 October 2019 £'000 (Unaudited) |
| Six months ended 31 October 2018 £'000 (Unaudited) |
| Year ended £'000 (Audited) |
Loss for the period |
(2,264) |
|
(1,653) |
|
(283) |
Items that may be recycled to the income statement |
|
|
|
|
|
Exchange gains/(losses) on translation of foreign operations | (35) |
| 1,689 |
| 1,218 |
Total comprehensive gain/(loss) for the period | (2,299) |
| 36 |
| 935 |
Consolidated condensed statement of financial position
As at
| Note |
| 31 October 2019 £'000 |
| 31 October 2018 £'000 |
|
£'000 |
Non-current assets |
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
|
|
| 1,275 |
| 1,275 |
| 1,275 |
Other intangible assets |
|
| 18,986 |
| 17,760 |
| 18,165 |
Investments - Long term cash deposits |
|
| - |
| 1,250 |
| 1,250 |
Property, plant and equipment | 8 |
| 11,365 |
| 5,864 |
| 6,252 |
Right-of-use asset |
|
| 3,809 |
| 4,488 |
| 3,975 |
|
|
|
|
|
|
|
|
|
|
| 35,435 |
| 30,637 |
| 30,917 |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
Inventories |
|
| 4,014 |
| 3,307 |
| 3,227 |
Trade and other receivables |
|
| 20,823 |
| 13,115 |
| 19,997 |
Current tax assets |
|
| 515 |
| 514 |
| 987 |
Cash and bank balances |
|
| 13,437 |
| 6,340 |
| 20,616 |
|
|
|
|
|
|
|
|
|
|
| 38,789 |
| 23,276 |
| 44,827 |
|
|
|
|
|
|
|
|
Total assets |
|
| 74,224 |
| 53,913 |
| 75,744 |
Current liabilities |
|
|
|
|
|
|
|
Trade and other payables |
|
| (5,369) |
| (3,197) |
| (4,884) |
Lease obligation |
|
| (270) |
| (310) |
| (273) |
Borrowings |
|
| (3,607) |
| (3,105) |
| (3,133) |
Provisions for liabilities |
|
| - |
| (281) |
| - |
|
|
|
|
|
|
|
|
|
|
| (9,246) |
| (6,893) |
| (8,290) |
|
|
|
|
|
|
|
|
Net current assets |
|
| 29,543 |
| 16,383 |
| 36,537 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
|
Finance lease liabilities |
|
| (3,815) |
| (4,289) |
| (3,938) |
Borrowings |
|
| (2,156) |
| (2,389) |
| (2,313) |
|
|
|
|
|
|
|
|
Total liabilities |
|
| (15,217) |
| (13,571) |
| (14,541) |
|
|
|
|
|
|
|
|
Net assets |
|
| 59,007 |
| 40,342 |
| 61,203 |
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
Share capital | 10 |
| 3,447 |
| 2,605 |
| 3,446 |
Share premium account |
|
| 61,602 |
| 42,626 |
| 61,600 |
Capital redemption reserve |
|
| 21,853 |
| 21,853 |
| 21,853 |
Translation reserve |
|
| 914 |
| 1,420 |
| 949 |
Retained earnings |
|
| (28,809) |
| (28,162) |
| (26,645) |
|
|
|
|
|
|
|
|
Total equity |
|
| 59,007 |
| 40,342 |
| 61,203 |
|
|
|
|
|
|
|
|
Consolidated condensed statement of changes in equity
For the six months ended
| Equity attributable to equity holders of the Group |
| |||||||||||
|
Share Capital £'000 |
| Share Premium Account £'000 |
|
|
Merger Reserve £'000 |
|
Translation Reserve £'000 |
|
Retained Earnings £'000 |
|
Total £'000 | |
Balance at | 3,446 |
| 61,600 |
|
| 21,853 |
| 949 |
| (26,645) |
| 61,203 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Loss for the period | - |
| - |
|
| - |
| - |
| (2,264) |
| (2,264) | |
Other comprehensive income for the period |
- |
|
- |
|
|
- |
|
(35) |
|
- |
|
(35) | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Total comprehensive gain for the period | - |
| - |
|
| - |
| (35) |
| (2,264) |
| (2,299) | |
Transactions with shareholders recorded in equity |
|
|
|
|
|
|
|
|
|
|
|
| |
Issue of share capital net of expenses | 1 |
| - |
|
| - |
| - |
| - |
| 1 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Premium on shares issued less expenses |
- |
|
2 |
|
|
- |
|
- |
|
- |
|
2 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Credit to equity for equity-settled share-based payments |
- |
|
- |
|
|
- |
|
- |
|
100 |
|
100 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at | 3,447 |
| 61,602 |
|
| 21,853 |
| 914 |
| (28,809) |
| 59,007 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at |
2,604 |
|
42,625 |
|
|
21,853 |
|
(269) |
|
(26,557) |
|
40,256 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Loss for the period | - |
| - |
|
| - |
| - |
| (1,653) |
| (1,653) | |
Other comprehensive income for the period | - |
| - |
|
| - |
| 1,689 |
| - |
| 1,689 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Total comprehensive loss for the period |
- |
|
- |
|
|
- |
|
1,689 |
|
(1,653) |
|
36 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Transactions with shareholders recorded in equity |
|
|
|
|
|
|
|
|
|
|
|
| |
Issue of share capital net of expenses | 1 |
| - |
|
| - |
| - |
| - |
| 1 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Premium on shares issued less expenses |
- |
|
1 |
|
|
- |
|
- |
|
- |
|
1 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Credit to equity for equity-settled share-based payments |
- |
|
- |
|
|
- |
|
- |
|
48 |
|
48 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at 31 October 2018 | 2,605 |
| 42,626 |
|
| 21,853 |
| 1,420 |
| (28,162) |
| 40,342 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at 1 May 2018 |
2,604 |
|
42,625 |
|
|
21,853 |
|
(269) |
|
(26,557) |
|
40,256 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Loss for the year | - |
| - |
|
| - |
| - |
| (283) |
| (283) | |
Other comprehensive income for the period |
- |
|
- |
|
|
- |
|
1,218 |
|
- |
|
1,218 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Total comprehensive loss for the year |
- |
|
- |
|
|
- |
|
1,218 |
|
(283) |
|
935 | |
Transactions with shareholders recorded in equity |
|
|
|
|
|
|
|
|
|
|
|
| |
Issue of share capital net of expenses |
842 |
|
18,975 |
|
|
- |
|
- |
|
- |
|
19,817 | |
Credit to equity for equity-settled share-based payments |
- |
|
- |
|
|
- |
|
- |
|
195 |
|
195 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at 30 April 2019 | 3,446 |
| 61,600 |
|
| 21,853 |
| 949 |
| (26,645) |
| 61,203 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Consolidated condensed statement of cash flows
For the six months ended 31 October 2019
| Note |
| Six months ended 31 October 2019 £'000 |
| Six months ended 31 October 2018 £'000 |
| Year ended 30 April 2019 £'000 |
|
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
|
|
|
|
|
|
|
|
Net cash used in operating activities | 9 |
| (876) |
| (1,940) |
| (4,777) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment in long term cash deposits |
|
| 1,250 |
| - |
| - |
Interest received |
|
| 45 |
| 129 |
| 155 |
Purchases of property, plant and equipment |
|
| (5,459) |
| (2,957) |
| (3,644) |
Purchases of patents and trademarks |
|
| (111) |
| (104) |
| (210) |
Capitalisation of research and development costs |
|
| (1,738) |
| (1,503) |
| (2,731) |
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
| (6,013) |
| (4,435) |
| (6,430) |
|
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans received |
|
| 2,000 |
| 2,495 |
| 2,557 |
Proceeds on issue of shares |
|
| 2 |
| 2 |
| 19,817 |
Interest paid |
|
| (233) |
| (176) |
| (293) |
Payment of loan and borrowings |
|
| (1,683) |
|
|
| (111) |
Finance lease repayments |
|
| (265) |
| (58) |
| (486) |
|
|
|
|
|
|
|
|
Net cash (used in)/generated from financing activities |
|
| (179) |
| 2,263 |
| 21,484 |
|
|
|
|
|
|
|
|
Net decrease/(increase) in cash and cash equivalents |
|
| (7,068) |
| (4,112) |
| 10,277 |
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of period |
|
| 20,616 |
| 9,488 |
| 9,488 |
|
|
|
|
|
|
|
|
Effect of foreign exchange rate changes |
|
| (111) |
| 964 |
| 851 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period |
|
| 13,437 |
| 6,340 |
| 20,616 |
Notes to the unaudited interim statements
For the six months ended 31 October 2019
1. Basis of preparation
This interim financial report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The auditors reported on the
2. Going concern
The directors are satisfied that the Group has sufficient resources and facilities to continue in operation for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly, they continue to adopt the going concern basis in preparing the interim financial statements.
3. Interim report
This interim financial report will be available from the Group's website at www.kromek.com.
4. Business and geographical segments
Products and services from which reportable segments derive their revenues
For management purposes, the Group is organised into two business units (
The chief operating decision maker is the Board of Directors who assess performance of the segments using the following key performance indicators; revenues, gross profit, operating profit and EBITDA. The amounts provided to the Board with respect to assets and liabilities are measured in a way consistent with the Financial Statements.
The turnover, profit on ordinary activities and net assets of the Group are attributable to one business segment, i.e. the development of digital colour x-ray imaging enabling direct materials identification, as well as developing a number of detection products in the industrial and consumer markets. Whilst results are not measured by end market, the Group currently categorises its customers as belonging to the Nuclear, Medical or Security sectors.
Analysis by geographical area
A geographical analysis of the Group's revenue by destination is as follows:
|
| Six months ended 31 October 2019 £'000 |
| Six months ended 31 October 2018 £'000 |
| Year ended 30 April 2019 £'000 |
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
|
|
|
|
|
|
|
|
| 1,916 |
| 171 |
| 2,267 |
|
| 2,362 |
| 985 |
| 4,869 |
|
| 113 |
| 1,875 |
| 5,452 |
|
| 940 |
| 630 |
| 1,905 |
|
| 2 |
| 24 |
| 24 |
|
|
|
|
|
|
|
Total revenue |
| 5,333 |
| 3,685 |
| 14,517 |
|
|
|
|
|
|
|
4. Business and geographical segments (continued)
A geographical analysis of the Group's revenue by origin is as follows:
Six months ended 31 October 2019
| £'000 |
| £'000 |
| Total for Group £'000 |
Revenue from sales Revenue by segment: -Sale of goods and services | 2,867 |
| 2,770 |
| 5,637 |
-Revenue from grants | 508 |
| - |
| 508 |
-Revenue from contract customers | 310 |
| 30 |
| 340 |
Total sales by segment | 3,685 |
| 2,800 |
| 6,485 |
Removal of inter-segment sales | (642) |
| (510) |
| (1,152) |
Total external sales | 3,043 |
| 2,290 |
| 5,333 |
|
|
|
|
|
|
Segment result - operating loss | (573) |
| (1,769) |
| (2,342) |
Net interest | (163) |
| (148) |
| (311) |
Loss before tax | (736) |
| (1,917) |
| (2,653) |
Tax credit | 389 |
| - |
| 389 |
Loss for the period | (347) |
| (1,917) |
| (2,264) |
Other information |
|
|
|
|
|
Property, plant and equipment additions | 4,963 |
| 496 |
| 5,459 |
Depreciation of property, plant and equipment | 221 |
| 323 |
| 544 |
Intangible asset additions | 1,044 |
| 805 |
| 1,849 |
Amortisation of intangible assets | 573 |
| 514 |
| 1,087 |
|
|
|
|
|
|
Balance Sheet |
|
|
|
|
|
Total assets | 38,059 |
| 36,182 |
| 74,241 |
Total liabilities | (9,536) |
| (5,698) |
| (15,234) |
Inter-segment sales are charged at prevailing market prices.
No impairment losses were recognised in respect of property, plant and equipment and goodwill.
4. Business and geographical segments (continued)
Six months ended 31 October 2018
| £'000 |
| £'000 |
| Total for Group £'000 |
Revenue from sales Revenue by segment: -Sale of goods and services | 1,755 |
| 1,233 |
| 2,988 |
-Revenue from grants | 100 |
| - |
| 100 |
-Revenue from contract customers | 81 |
| 1,451 |
| 1,532 |
Total sales by segment | 1,936 |
| 2,684 |
| 4,620 |
Removal of inter-segment sales | (569) |
| (366) |
| (935) |
Total external sales | 1,367 |
| 2,318 |
| 3,685 |
|
|
|
|
|
|
Segment result - operating loss | (1,156) |
| (930) |
| (2,086) |
Net interest | 85 |
| (132) |
| (47) |
Loss before tax | (1,071) |
| (1,062) |
| (2,133) |
Tax credit | 514 |
| (34) |
| 480 |
Loss for the period | (557) |
| (1,096) |
| (1,653) |
Other information |
|
|
|
|
|
Property, plant and equipment additions | 1,246 |
| 6,368 |
| 7,614 |
Depreciation of property, plant and equipment | 228 |
| 217 |
| 445 |
Intangible asset additions | 825 |
| 783 |
| 1,608 |
Amortisation of intangible assets | 614 |
| 426 |
| 1,040 |
|
|
|
|
|
|
Balance Sheet |
|
|
|
|
|
Total assets | 24,384 |
| 29,389 |
| 53,913 |
Total liabilities | (6,162) |
| (7,409) |
| (13,571) |
The accounting policies of the reportable segments are the same as the Group's accounting policies. Segment profit represents the profit earned by each segment without allocation of the share of profits of associates, central administration costs including directors' salaries, investment revenue and finance costs, and income tax expense. This is the measure reported to the Group's Chief Executive for the purpose of resource allocation and assessment of segment performance.
5. Tax
The Group has recognised R&D tax credits of £389k for the six months ended 31 October 2019 (six months ended 31 October 2018: £514k, offset by a £34k US tax charge).
6. Dividends
The directors do not recommend the payment of a dividend (six months ended 31 October 2018: £nil).
7. Losses per share
The calculation of the basic and diluted earnings per share is based on the following data:
Losses
|
| Six months ended 31 October 2019 £'000 |
| Six months ended 31 October 2018 £'000 |
| Year ended 30 April 2019 £'000 |
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
Losses for the purposes of basic earnings per share being net profit attributable to owners of the Group |
|
(2,264) |
| (1,653) |
| (283) |
|
|
|
|
|
|
|
|
|
Six months ended 31 October 2019 Thousands |
| Six months ended 31 October 2018 Thousands |
| Year ended 30 April 2019 Thousands |
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
Number of shares |
|
|
|
|
|
|
Weighted average number of ordinary shares for the purposes of basic losses per share |
| 344,642 |
| 260,500 |
| 275,073 |
|
|
|
|
|
|
|
Effect of dilutive potential ordinary shares: |
|
|
|
|
|
|
Share options and warrants |
| 1,573 |
| 2,944 |
| 2,581 |
|
|
|
|
|
|
|
Weighted average number of ordinary shares for the purposes of diluted earnings per share |
| 346,215 |
| 263,444 |
| 277,655 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (p) |
| (0.7) |
| (0.6) |
| (0.1) |
Diluted (p) |
| (0.7) |
| (0.6) |
| (0.1) |
|
|
|
|
|
|
|
Due to the Group having losses in each of the periods, the fully diluted loss per share for disclosure purposes, as shown in the income statement, is the same as for the basic loss per share.
8. Property, plant and equipment
During the six months ended 31 October 2019, the Group acquired property, plant and equipment with a cost of £5,459k (six months ended 31 October 2018: £7,614k, of which £4,521k related to ROU accounted for under IFRS 16 and £2,528k related to tenancy improvements financed by a loan with the landlord). Of this £5,459k, £4,834k relates to assets under construction.
9. Notes to the cash flow statement
|
| Six months ended 31 October 2019 £'000 |
| Six months ended 31 October 2018 £'000 |
| Year ended 30 April 2019 £'000 |
|
| (Unaudited) |
| (Unaudited) |
| (Audited) |
Loss for the period |
| (2,264) |
| (1,653) |
| (283) |
|
|
|
|
|
|
|
Adjustments for: |
|
|
|
|
|
|
Finance income |
| (45) |
| (129) |
| (155) |
Finance costs |
| 356 |
| 176 |
| 519 |
Income tax credit |
| (389) |
| (480) |
| (987) |
Depreciation of property, plant and equipment |
| 544 |
| 445 |
| 879 |
Amortisation of intangible assets |
| 1,087 |
| 1,040 |
| 1,806 |
Share-based payment expense |
| 100 |
| 48 |
| 195 |
|
|
|
|
|
|
|
Operating cash flows before movements in working capital |
| (611) |
| (553) |
| 1,974 |
|
|
|
|
|
|
|
Increase in inventories |
| (787) |
| (293) |
| (213) |
Increase in receivables |
| (826) |
| (1,781) |
| (8,663) |
Decrease/(increase) in payables |
| 485 |
| (303) |
| 1,384 |
Decrease in provisions |
| - |
| (143) |
| (424) |
|
|
|
|
|
|
|
Cash used in operations |
| (1,739) |
| (3,073) |
| (5,942) |
|
|
|
|
|
|
|
Income taxes received |
| 863 |
| 1,133 |
| 1,165 |
|
|
|
|
|
|
|
Net cash used in operating activities |
| (876) |
| (1,940) |
| (4,777) |
|
|
|
|
|
|
|
10. Share capital
During the period, 12,000 ordinary shares (six months ended 31 October 2018: 115,000) were issued because of the exercise of employee share options.
11. Events after the balance sheet date
There are no significant or disclosable post-balance sheet events.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the
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