TIDMTRT
RNS Number : 4388N
Transense Technologies PLC
25 September 2023
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014 which is part of UK law by
virtue of the European Union (withdrawal) Act 2018. Upon the
publication of this announcement, this inside information is now
considered to be in the public domain.
25 September 2023
Transense Technologies plc
("Transense" or the "Company")
Final results for the year ended 30 June 2023
& notice of investor presentation
Transense Technologies plc (AIM: TRT), the provider of
specialist sensor systems, announces its final results for the year
ended 30 June 2023.
The Board of Transense is pleased to announce substantial
increases in revenue and profitability, and further considerable
progress in the development of commercial pipeline opportunities.
The Company has achieved the strategic objectives set out in 2020,
and now sets out commercial and financial goals for the medium term
to 2028.
The directors consider that there are positive market drivers
across all key target market sectors which provide ample
opportunity to expand, despite current uncertain economic
conditions, and Transense is investing in technology, equipment and
human resources in order to build strategic and sustainable long
term shareholder value.
Financial highlights:
-- Revenue up 34% to GBP3.53m (FY22: GBP2.63m)
-- iTrack royalty increased 29% to GBP2.01m (FY22: GBP1.56m)
-- Translogik probe revenue up 17% to GBP1.03m (FY22: GBP0.88m)
-- SAW revenue up 146% to GBP0.49m (FY22: GBP0.20m) with further
substantial increases in activity from prospective customers
-- Adjusted profit before taxation of GBP1.09m (FY22: GBP0.27m) *
-- Earnings per share up more than 64% to 8.81 pence (FY22: 5.36 pence)
-- Cash and cash equivalents at year end of GBP0.98m (FY22: GBP1.06m)
-- Completed share buybacks of GBP0.40m (FY22: GBP0.30m)
-- Distributable reserves at year end of GBP2.90m (FY22: GBP1.20m)
*Before exceptional administrative expenses
Executive Chairman of Transense, Nigel Rogers, said:
"We are pleased to report these results, showing continued
growth and our strategy delivering. We have visibility of several
exciting growth opportunities for Translogik and are now adding an
experienced and successful business development leader with sole
focus on the delivery of greater scale and reach.
"There has been a rapid expansion of market awareness at
SAWsense, and an increasing intensity of funded development
projects.
"We now believe that we have built a dynamic leadership group
within the executive team, with the requisite skills, experience
and networks to deliver further step changes in results in coming
years."
Investor Presentation: 4pm, Monday 25 September 2023
Nigel Rogers (Executive Chairman) and Melvyn Segal (Chief
Financial Officer) will provide a presentation to review the
Company's results and prospects at 4pm on Monday 25 September 2023.
The presentation will be hosted through the online platform
Investor Meet Company.
To attend the presentation, investors can sign up to Investor
Meet Company for free and select to meet Transense Technologies plc
via the following link:
https://www.investormeetcompany.com/transense-technologies-plc/register-investor
. Investors who have already registered and selected to meet the
Company will automatically be invited to the presentation.
Questions can be submitted before the event to
transense@walbrookpr.com or in real time during the presentation
via the "Ask a Question" function.
For further information please visit www.transense.com or
contact:
Transense Technologies plc Tel: Via Walbrook PR
Nigel Rogers (Executive Chairman)
Melvyn Segal (CFO)
Allenby Capital (Nominated Adviser and Tel: +44 (0)20 3328
Broker) 5656
Jeremy Porter/George Payne (Corporate Finance)
Tony Quirke/Stefano Aquilino (Sales & Corporate
Broking)
Walbrook PR Tel: +44 (0)20 7933
Tom Cooper/Nick Rome 8780
Transense@walbrookpr.com
Notes to Editors:
Transense is a developer of specialist wireless sensor systems
used to enable real-time data gathering and monitoring. Products
include the patent protected Surface Acoustic Wave (SAW) sensor
technology, used to improve equipment power, performance,
reliability and efficiency; iTrack, Transense 's Tyre Pressure
Monitoring System, licensed to Bridgestone Corporation, the world's
largest tyre producer, under a ten-year deal in June 2020; and a
range of intelligent tyre monitoring equipment under the Translogik
brand. Target sectors include aerospace, electric motors &
drives, industrial machinery and performance automotive.
The Company's strategy is to maximise shareholder value through
the delivery of sustained revenue growth from all three principal
technologies - SAW, iTrack and Translogik probes - through
leveraging excellence in innovation, know-how in commercialising
technologies, industry partnerships and exposure to global growth
markets.
Transense is headquartered in Oxfordshire, UK, and was admitted
to trading on AIM, a market operated by the
London Stock Exchange (AIM: TRT), in 1999. www.transense.com
For further information please contact transense@walbrookpr.com .
CHAIRMAN'S STATEMENT
The Company has delivered excellent results with revenues up by
one third and pre tax profits (before exceptional administrative
costs) up fourfold. The potential to continue on this trajectory is
underpinned by a healthy pipeline of new business opportunities,
giving the directors confidence in the prospects for Transense.
Business strategy
The business strategy of the Company remains to develop
innovative sensing solutions across a range of applications, which
are commercialised either through the launch of products and
services to customers or by forming strategic alliances with
partner organisations. Value is realised through a combination of
commercial income, royalties, licensing income and capital gains on
disposals.
There are currently two active business segments: Translogik and
SAWsense. Translogik develops and supplies smart, connected tyre
monitoring equipment for the commercial truck and bus market, and
SAWsense designs and supplies advanced sensor solutions for
accurate non-contact measurement of torque, force, pressure and
temperature for aerospace, electric motors and drives (EMD),
industrial machinery and high performance automotive sectors. In
addition, the company earns residual royalty income from iTrack, a
system developed by the company for monitoring mining haul tyre
performance which was licenced to Bridgestone Corporation for a ten
year period expiring in 2030.
The directors consider that there are positive market drivers
across all of our key target market sectors which provide ample
opportunity to expand both businesses, despite current uncertain
economic conditions. We are investing in technology, equipment and
human resources across both active business segments in order to
secure greater access to the target markets and build strategic and
sustainable long term shareholder value.
Results for the year
Revenues for the year increased by 34% to GBP3.53m (FY22:
GBP2.63m), with SAWsense up 146% and Translogik up 17%. Royalty
income from iTrack increased by 29%, reflecting an expected
improvement in the second half of the year. Gross margin improved
to 87% of revenue (FY22: 85%) amounting to GBP3.05m (FY22:
GBP2.23m).
Administrative expenses increased a modest amount to GBP2.09m
(FY22: GBP1.97m), before exceptional severance costs of GBP0.22m.
Earnings before Interest, Taxation, Depreciation and Amortisation
(EBITDA) adjusted for the charge for exceptional costs and
share-based payments was GBP1.40m (FY22: GBP0.62m), and the
adjusted net profit before taxation (excluding exceptional costs)
was GBP1.09m (FY22: GBP0.27m).
There was a credit for taxation of GBP0.53m (FY22: GBP0.61m)
arising from the increase in the deferred taxation asset relating
to the use of previous years' tax losses in the future, reflecting
a future forecast period of two years which is in line with the
basis adopted in the prior year. In total, the Company has UK tax
losses available to carry forward at 30 June 2023 in excess of
GBP21m, which are available for offset against future profits
subject to HMRC agreement, of which approximately GBP4.70m is
currently recognised for deferred taxation purposes (FY22:
GBP2.58m).
The resulting net total comprehensive income attributable to
equity shareholders was GBP1.40m (FY22: GBP0.88m) resulting in
earnings per share (EPS) of 8.81 pence (FY22: 5.36 pence).
The adjusted EPS before exceptional administrative costs was
10.20 pence.
The Company's financial position strengthened further during the
year with net assets increasing to GBP4.19m (FY22: GBP3.09m) as a
result of the retention of net profits after taxation. Net
available cash balances amounted to GBP0.98m (FY22: GBP1.06m), and
the final quarter royalty income on iTrack receivable on 31 July
2022 stood at GBP0.54m (FY22: 0.47m).
Net cash generated from operations amounted to GBP0.65m (FY22:
GBP0.41m). This was re-invested in capital expenditure of GBP0.26m
(FY22: GBP0.10m) and in the share buy-back programme during the
year totaling GBP0.41m (FY22: GBP0.30m). The directors anticipate
that the Company will continue to be cash generative for the
foreseeable future and will accumulate further cash balances well
in excess of the ongoing and any proposed new buy-back
programme.
Mid-term financial goals 2023-28
Mid-term financial goals for the Company's businesses were last
set out in June 2020, immediately following the completion of the
iTrack licence with Bridgestone. Since that time, financial results
have been in line with or ahead of our expectations.
The directors now consider it an appropriate time to set out new
mid-term goals for the company for the period 2023 to 2028. During
this period it is anticipated that the iTrack licence income will
continue to show healthy growth before reaching a peak in the year
ending 30 June 2025. The increase in the number of installations
thereafter is unlikely to fully offset the reduction in the unit
royalty rate, and the annual royalty in the year to 30 June 2026 is
expected to reduce to a level comparable with the year ended 30
June 2023.
The directors are confident that prospects in each of the two
active business segments will be such that the Company can maintain
the overall level of profitability and earnings despite any
reduction in the level of iTrack royalty revenues.
Segmental review
Translogik tyre monitoring
Our range of tyre monitoring equipment marketed under the
Translogik brand generated revenue of GBP1.03m; an increase of
almost 17% over the prior year (FY22: GBP0.88m), and the segmental
result was up by 17% to GBP0.42m (FY22: GBP0.36m).
The road haulage and transport logistics sector continues to
experience strong volume growth yet is also subject to intense
competitive pressure to reduce unit costs and optimise asset
utilisation. In parallel, however, operators are subject to
increasing road safety regulations, including the mandatory use of
tyre pressure monitoring systems (TPMS) in the EU from 2024 and the
US from 2028. These add to the existing regulations for mandatory
vehicle inspections and digital record keeping, and the increasing
adoption of radio frequency identification tags (RFID) for tyre
inventory management.
All of these challenges can be managed efficiently through the
use of Translogik tyre monitoring equipment, which digitises key
tyre data to integrate into a fleet management platform. We have a
robust blue chip customer base of global tyre manufacturers upon
which to build, lending credibility to the effectiveness and
reliability of our equipment.
The directors estimate that there is an addressable market for
fleet management tools exceeding US$25m per annum, and this leads
us to believe that Translogik provides the capacity to accelerate
segmental revenue in the next three to five years. Accordingly, we
have recently secured the appointment of a dedicated business
development director to lead this activity who has the breadth of
knowledge and established network of contacts to deliver step
change when he takes up this new role shortly.
SAWsense
SAWsense revenues more than doubled to GBP0.49m (FY22: GBP0.20m)
and with operating overheads almost unchanged the net loss (before
exceptional costs) for the segment reduced by 33% to GBP0.55m
(FY22: GBP0.82m). During the year, changes were implemented to the
segmental management structure to better align the senior team to
customer needs, which is now led by Ryan Maughan as Business
Development Director and Andy Bullock as Technical Director.
Our market approach for SAW technology continues to focus on
four sectors in which there are applications with clear
differentiated benefits, and we have made good progress in each
during the year.
Target market sectors for SAWsense:
Aerospace
The aerospace sector is undergoing a period of profound change
driven by the need to reduce the environmental impact of air
travel, and opportunities to expand the sector through new and
innovative platforms for electrified urban air mobility (UAM). This
has created intense development activity by established market
leaders and new entrants, focused on developing cleaner and more
efficient conventional aircraft, and on the feasibility of new
propulsion systems including all-electric, hybrid electric and
hydrogen fuel cell technology.
In the past twelve months, we have doubled the number of
potential customers with whom we are working to introduce SAW
technology into aerospace applications from seven to fourteen.
These include GE Aerospace, to whom we have granted existing
licences, and Parker Meggitt who are subject of a Memorandum of
Understanding signed in September 2022 with the shared intention of
agreeing terms for a licence before the end of 2023. Discussions
with Parker Meggitt are ongoing, and a further update will be
provided in due course. In addition, there are several other
potential customers in this sector whose involvement is covered by
confidentiality agreements .
The case for using SAW torque sensing has been proven for
helicopter engines, and there are now live development activities
for use in electric actuator force and torque control, and torque
in hybrid generation systems and advanced open rotor engines. In
addition, there are other opportunities to introduce SAW for use in
electric propulsion motors for aerospace applications, as well as
torque, pressure and/or temperature measurement for a variety of
other airframe and propulsion systems.
The aircraft sensor market was estimated to be valued at US$4bn
in 2021, with forecast compound annual growth at a rate of 8% in
the period to 2028. The directors believe that a realistic goal for
annual revenue from development, engineering services and component
supply into this sector by SAWsense could lie in the range US$5-10m
by 2030.
Industrial Machinery (including Off-Highway Vehicles and
Robotics)
The use of SAW sensing technology for torque and/or temperature
can improve accuracy, efficiency and power distribution in
industrial machinery ranging from robots to agricultural equipment.
Enhanced sensing is also required to enable more autonomous
operation of machinery.
During the year, SAWsense technology underwent rigorous trials
by a major producer of agricultural machinery. The project was
completed on schedule and validated the accuracy and reliability of
the resulting data. Whilst this is expected to strengthen the
business case for the use of SAW, this was an advanced research and
technology program and work continues to explore production
applications for the technology. A number of other off-highway
OEM's have also expressed interest and are at an early stage of
engagement in information exchange under NDA. We believe that the
addressable market for torque and temperature sensors in this
sector exceeds US$25m per annum.
The global market for force and torque sensors for industrial
robotics was estimated to be worth US$300m in 2022 and was forecast
to grow to more than US$650m by 2028. Engagement with a select
group of leading companies in this industry indicates that SAW
technology can provide an improved way to measure torque and
temperature in a robotic system, increasing the speed and accuracy
of the robot by reducing joint flex and motor jitter. This in turn
offers increased load capacity and productivity, because of this we
believe that this valuable differentiation results in more than
US$50m per annum of the robot torque sensor market to be
addressable by our technology by 2028.
Motorsport and high-performance vehicles
SAWsense continues to work closely in the premium motor sport
sector with our joint collaboration agreement partner, McLaren
Applied. During the year, use of SAW was extended beyond its roots
in IndyCar to the Le Mans Daytona Hybrid series of endurance
racing. There are further opportunities to extend to additional
championships at proposal stage, with the outcome expected in the
final quarter of 2023.
SAW has proven to be more accurate and reliable than competitor
systems and offers a lower lifecycle cost to event organisations
and race teams. Whilst motorsport is a niche sector, we estimate
that the addressable market for motorsport torque measurement
exceeds US$25m per annum and believe that there are unique
characteristics in our technology to be successful.
Success in these motor sport applications demonstrates the
performance and reliability of the technology in harsh operating
conditions.
Electric Motors and Drives (EMD)
The drive to reduce global dependency on fossil fuels is heavily
dependent on the development and commercialisation of efficient
electric motors and drives across a broad range of transport and
industrial applications. Using SAW technology offers access to
real-time torque and temperature data to improve performance,
efficiency, range and functional safety, and provides opportunity
to reduce material costs, particularly of rare earth materials in
permanent magnet motors.
Unlike our other key target sectors, the use of real time torque
data to control electric motors and drives is not common practice,
and instead controls are reliant upon traditional torque estimation
methods with roots going back decades. During the year we have
contracted a leading engineering consultancy to carry out a program
of simulation work to demonstrate the benefits of using real time
actual torque in the control loop, with good results.
In the current year, these findings will be expanded by
conducting live trials on a demonstration test rig, and we
anticipate that this activity will generate opportunities to expand
our intellectual property portfolio further and to build a platform
for commercial advancement.
Business development activities
Throughout the year there has been an increasing volume of
inbound enquiries across all of our main target markets, mostly
driven by the increased awareness of the benefits of our technology
from marketing assets such as on-line video content, conference
presentations and trade show attendance.
Discussions with Parker Meggitt are ongoing, a further update
will be provided in due course. There are several other potential
customers in this sector whose involvement is covered by
confidentiality agreements.
Enquiries are carefully vetted, and those which meet our
qualification criteria enter a standardised process through a
number of stage gates. Passage through this mechanism can take
several months before reaching agreement on a funded development
project to instrument a demonstration unit and carry out
performance assessment. Beyond that, there are many other factors
to evaluate (including for example productionisation methods,
supply chain and associated cost) before customers are ready to
commit to full scale commercial implementation.
Overall, it is realistic to expect that achieving volume
production in highly regulated markets such as aerospace and
automotive will take three to five years, during which period
customers will have the capacity and willingness to fund further
development work.
This process has been underway for more than one year, and
progress has been made both in the number of active qualified
enquiries (which has more than doubled from 24 to 57), and the
depth of engagement indicated by moving to towards funded
development (which has also doubled from 6 to 13). Full details are
as follows:
Status of potential customers by sector as at September 2023
(September 2022)
Electric Industrial Performance
Aerospace Motors & Machinery Automotive Total
Drives
Stage 4 - Contracted 1 (1) 0 (0) 0 (0) 1 (1) 2 (2)
------------ ---------- ----------- ------------ --------
Stage 3 - Contract
under negotiation 2 (1) 0 (0) 0 (0) 0 (0) 2 (1)
------------ ---------- ----------- ------------ --------
Stage 2 - In development 1 (1) 3 (1) 1 (1) 1 (0) 6 (3)
------------ ---------- ----------- ------------ --------
Stage 1a - Development
project in planning 3 (0) 2 (2) 1 (1) 1 (0) 7 (3)
------------ ---------- ----------- ------------ --------
Stage 1b - Active
enquiry 7 (4) 24 (8) 8 (3) 1 (0) 40 (15)
------------ ---------- ----------- ------------ --------
Total 14 (7) 29 (11) 10 (5) 4 (1) 57 (24)
------------ ---------- ----------- ------------ --------
iTrack royalty income
Royalty income from iTrack generated income of GBP2.01m during
the year, representing an increase of 29% over the prior year
(FY22: GBP1.56m). By the end of the year, the installed base had
risen to almost four times that which prevailed at the outset of
the licence, and the annualised royalty run rate had increased to
$2.92m, compared with $2.26m, representing a 29% increase over the
prior year.
Bridgestone Corporation, Japan, continues to indicate that
iTrack is a key strategic component of their mobility solutions
business and express confidence in the future growth potential for
this technology.
Board structure and composition
In May 2023, Steve Parker joined the Board as an independent
non-executive director. He is a highly experienced board director
with an enviable track record of leading and advising businesses
across the technology, automotive and transportation sectors. The
Company has already benefited greatly from his expertise and
judgement, and I am grateful for his valuable support.
Rodney Westhead has indicated that he intends to retire from the
Board following the appointment of an appropriate independent
non-executive director and chair of audit committee to replace him.
He has served as a director since 2007 and has made an invaluable
contribution over many years, especially more recently as the
commercialisation of SAW technology has come to the forefront of
the Company's strategy. The directors intend to appoint a suitable
successor during the current financial year.
Distribution policy
Since February 2022, when the Company first announced the
commencement of a programme to conduct market purchases of ordinary
shares of 10 pence each in the Company, a total of 935,356 ordinary
shares have been acquired for treasury at an average price of 80
pence each (including 40,000 post year end).
During the financial year the share price fluctuated between
48.5 pence and 95.5 pence, and averaged approximately 80 pence. The
directors continue to view the Company's shares as undervalued at
this level and will execute further market purchases when suitable
opportunities arise, subject to the renewal of shareholder approval
for such action at the upcoming Annual General Meeting.
The board has given careful consideration to the relative merits
of share buybacks as an alternative form of distribution over the
payment of dividends. On balance, share buybacks are considered to
be more flexible and tax efficient, and are the preferred mechanism
for the majority of shareholders by both number and value.
Accordingly, the directors do not recommend the payment of a
dividend at the present time.
Current trading and outlook
In the first two months of trading since the end of the
financial year revenues have increased year on year by 16%, and the
commercial pipeline in both Translogik and SAWsense continue to
expand.
Royalties from iTrack have increased almost fourfold since
inception in 2020, and with seven years of the licence to run it is
expected to provide more than sufficient cash income to enable
further significant investment in both SAWsense and Translogik and
deliver strong returns to shareholders.
We have visibility of several exciting growth opportunities for
Translogik and are now adding an experienced and successful
business development leader with sole focus on the delivery of
greater scale and reach.
There has been a rapid expansion of market awareness at
SAWsense, and an increasing intensity of funded development
projects. Taken together with the potential to add depth, breadth
and longevity to the intellectual property portfolio of this
segment, the directors are confident of achieving a financially
self-sustaining business model with substantial strategic
value.
We now believe that we have built a dynamic leadership group
within the executive team, with the requisite skills, experience
and networks to deliver further step changes in results in coming
years.
Nigel Rogers
Executive Chairman
25 September 2023
Consolidated Statement of Comprehensive Income
For the year ended 30 June 2023
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
Revenue 3,529 2,632
Cost of sales (474) (398)
---------------------------------------------- ----------------------------------------------
Gross profit 3,055 2,234
Administrative
expenses (2,086) (1,970)
Exceptional (220) -
administrative
expenses
---------------------------------------------- ----------------------------------------------
Operating Profit 749 264
Financial
income/(expense) 4 (12)
Other income 113 16
---------------------------------------------- ----------------------------------------------
Profit before
taxation 866 268
Taxation 530 609
---------------------------------------------- ----------------------------------------------
Profit and total
comprehensive
income
for the year
attributable 1,396 877
To the equity
holders of the
parent ---------------------------------------------- ----------------------------------------------
Basic profit per
share for the year
(pence) 8.81 5.36
============================================== =============================================
Consolidated Balance Sheet
At 30 June 2023
At 30 June At 30 June
2023 2023 2022 2022
GBP'000 GBP'000 GBP'000 GBP'000
Non current assets
Property, plant and
equipment 154 167
Intangible assets 731 671
Deferred tax 1,175 645
---------------------------------------------- ----------------------------------------------
2,060 1,483
Current assets
Inventories 260 88
Trade and other
receivables 1,263 1,133
Cash and cash
equivalents 978 1,055
---------------------------------------------- ----------------------------------------------
2,501 2,276
---------------------------------------------- ----------------------------------------------
Total assets 4,561 3,759
Current liabilities
Trade and other
payables (334) (560)
Lease liabilities (36) (65)
---------------------------------------------- ----------------------------------------------
(370) (625)
Non current liabilities
Lease liabilities - (42)
---------------------------------------------- --------------------------------------
Total liabilities (370) (667)
---------------------------------------------- --------------------------------------
Net assets 4,191 3,092
============================================= =====================================
Equity
Issued share capital 1,644 1,644
Share premium 65 65
Treasury Shares (708) (303)
Share based payments 288 180
Retained
earnings/(accumulated
loss) 2,902 1,506
---------------------------------------------- ----------------------------------------------
Total equity 4,191 3,092
============================================== ==============================================
Consolidated Statement of Changes in Equity
For the year ended 30 June 2023
Share Share Share Retained Treasury Total
capital premium based earnings Shares Equity
payments
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 July
2021 1,631 - 82 629 - 2,342
Comprehensive
income for
the year:
Profit for the
year - - - 877 - 877
Share based
payment - - 98 - - 98
Warrants
exercised 13 65 - - - 78
Treasury shares - - - - (303) (303)
------------------------------ ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ----------------------------------------------
Balance at 30
June 2022 1,644 65 180 1,506 (303) 3,092
------------------------------ ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ----------------------------------------------
Share Share Share Retained Treasury Total
capital premium based earnings Shares Equity
payments
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 July
2022 1,644 65 180 1,506 (303) 3,092
Comprehensive
income for
the year:
Profit for the
year - - - 1,396 - 1,396
Share based
payment - - 108 - - 108
Treasury shares - - - - (405) (303)
------------------------------ ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ----------------------------------------------
Balance at 30
June 2022 1,644 65 288 2,902 (708) 4,191
------------------------------ ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ----------------------------------------------
Consolidated Cash Flow Statement
For the year ended 30 June 2023
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
Profit/(loss) from
operations 1,396 877
Adjustments for:
Taxation (530) (609)
Net financial
(income)/expense (4) 12
Share based payment 108 98
Depreciation 98 88
Amortisation and
impairment of
intangible
assets 112 155
---------------------------------------------- ----------------------------------------------
Operating cash flows
before movements
in working capital 1,180 621
(Increase) in
receivables (130) (569)
(Decrease)/increase
in payables (226) 300
(Increase) in
inventories (172) (15)
---------------------------------------------- ----------------------------------------------
Cash generated/(used)
in operations 652 337
Taxation received - 71
---------------------------------------------- ----------------------------------------------
Net cash generated in
operations 652 408
---------------------------------------------- ----------------------------------------------
Investing activities
Acquisitions of
property, plant and
equipment (85) (44)
Acquisitions of
intangible assets (172) (56)
---------------------------------------------- ----------------------------------------------
Net cash (used
in)/generated from
investing
activities (257) (100)
---------------------------------------------- ----------------------------------------------
Financing activities
Treasury shares (405) (303)
Warrants exercised - 78
Interest
received/(paid) 4 (12)
Payment of lease
liabilities (71) (62)
---------------------------------------------- ----------------------------------------------
Net cash used in
financing activities (472) (299)
---------------------------------------------- ----------------------------------------------
Net
(decrease)/increase
in cash and
cash equivalents (77) 9
Cash and equivalents
at the beginning
of year 1,055 1,046
---------------------------------------------- ----------------------------------------------
Cash and equivalents
at the end of
year 978 1,055
============================================== ==============================================
NOTES RELATING TO THE COMPANY FINANCIAL STATEMENTS
BASIS OF PREPARATION
Both the Parent Company financial statements and the Company
financial statements have been prepared and approved by the
Directors in accordance with International Financial Reporting
Standards as adopted by the United Kingdom ("Adopted IFRSs") and
those parts of the Companies Act 2006 that are relevant to
companies preparing accounts under IFRS. On publishing the Parent
Company financial statements here together with the Company
financial statements, the Company is taking advantage of the
exemption in s408 of the Companies Act 2006 not to present its
individual statement of comprehensive income and related notes that
form a part of these approved financial statements.
1 SEGMENT INFORMATION
The Company had three reportable segments being the unique
trading divisions, SAW and Translogik, which make use of technology
developed by the Company to measure and record temperature,
pressure and torque, and the iTrack royalty activity in respect of
income from licensed technology.
Revenue and EBITDA are the Company's key focus and in turn is
the main performance measure adopted by management.
The tables below set out the Company's revenue split and
operating segments. These disclose information for continuing
operations and in view of their relative size, information for
discontinued operations. The disposal of iTrack operations will
result in future royalty income replacing direct sales income and
costs.
Revenue
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
North America 351 323
South America 143 123
Australia 32 41
Europe 485 387
UK 379 92
Rest of the World 129 109
-------------------------------------------- --------------------------------------------
1,519 1,075
=========================================== ===========================================
iTrack Royalty 2,010 1,557
Total Revenue 3,529 2,632
Segments
Translogik SAW iTrack Unallocated Total
GBP'000 GBP'000 royalties GBP'000 GBP'000
GBP'000
Year ended 30
June
2023
Sales 1,027 492 2,010 - 3,529
===================== ===================== ===================== ===================== ====================
Gross profit 588 457 2,010 - 3,055
Administrative
expenses (165) (1,119) (44) (758) (2,066)
Exceptional
administrative
expenses (220) (220)
----------------------------- ----------------------------- ----------------------------- ----------------------------- -----------------------------
Operating
profit/(loss) 423 (882) 1,966 (758) 749
Other income - 113 - - 113
Net financial
income - - - 4 4
Taxation - - - 530 530
----------------------------- ---------------------------- ----------------------------- ----------------------------- -----------------------------
Profit/(loss)
for the
year 423 (769) 1,966 (224) 1,396
========== =========== =========== =========== ===========
EBITDA
reconciliation
Operating
profit 749
Other income 113
Depreciation
and
amortisation 209
------------------
EBITDA 1,071
===========
Note: Adjusted EBITDA (excluding share based payments) 1,179
Translogik SAW iTrack Unallocated Total
GBP'000 GBP'000 royalties GBP'000 GBP'000
GBP'000
Year ended 30
June
2022
Sales 875 200 1,557 - 2,632
================== =================== =================== =================== ====================
Gross profit 484 193 1,557 - 2,234
Administrative
expenses (126) (1,014) (44) (786) (1,970)
--------------------------- -------------------------- -------------------------- -------------------------- -----------------------------
Operating
profit/(loss) 358 (821) 1,513 (786) 264
Other income - 16 - - 16
Net financial
expense - - - (12) (12)
Taxation - - - 609 609
--------------------------- -------------------------- -------------------------- -------------------------- -----------------------------
Profit/(loss)
for the
year 358 (805) 1,513 (189) 877
========== ========= ========== ======= ===========
During the year ended 30 June 2023 there was 1 customer (2022:
2) whose turnover accounted for more than 10% of the Company's
total continuing revenue as follows:
Year ended 30 June 2023 Revenue Percentage
GBP'000 of total
Customer A 2,010 57
Year ended 30 June 2022 Revenue Percentage
GBP000 of total
Customer A 1,557 59
Customer B 339 13
2 TAXATION
Recognised in the statement of comprehensive income in respect
of continuing operations
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
Current tax credit
Adjustment for
previous year - (11)
Deferred tax
credit
Current year (530) (598)
--------------------------------------------- ---------------------------------------------
Tax credit in
Statement of
Comprehensive
Income (530) (609)
============================================ ============================================
Reconciliation of effective tax rate
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
Profit/(loss)
before tax 866 268
============================================= =============================================
Tax calculated at
the average
standard UK
corporation
tax rate of 23.50%
(2022: 19:00%) 178 51
Expenses not
deductible for tax
purposes 23 19
Utilisation of
losses brought
forward for which
no deferred tax
asset was
recognised 25 (23)
Recognition of
deferred tax in
respect of prior
year losses (756) (645)
Prior year
adjustment - (11)
---------------------------------------------- ----------------------------------------------
Total tax credit (530) (609)
============================================= =============================================
Deferred tax assets
are
Recognised - in
respect of tax
losses 1,175 645
Unrecognised - in
respect of tax
losses and
other timing
differences 4,528 4,900
============================================= =============================================
The applicable UK corporation tax rate is a blend of 19% for the
first 9 months and 25% thereafter giving an average rate for the
reporting period of 20.5%. The Group has tax losses, subject to
agreement by HM Revenue and Customs, in the sum of GBP21.9m (2022:
GBP22.8m), which are available for offset against future profits of
the same trade. There is no expiry date for tax losses. An
appropriate deferred tax asset is being recognised as the Group is
able to demonstrate a reasonable expectation of sufficient future
taxable profits arising in order to utilise the losses.
3 EARNINGS PER SHARE
Year ended Year ended
30 June 30 June
2023 2022
Number Number
Weighted average number of shares - basic 15,849,527 16,365,640
Share option adjustment for potentially dilutive
shares - -
-------------------- -------------------
Weighted average number of shares - diluted 15,849,527 16,365,640
============ ===========
Last year showed potential dilutive impact of share options
being 431,808 however this was incorrect as none of the share
options had reached the hurdle requirement necessary for the option
to be exercised. There are 1,504,300 share options and no warrants
in place at 30 June 2023 (1,594,500 share options 30 June
2022).
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
Profit/(loss) 1,396 877
-------------------- --------------------
Basic profit per share 8.81 5.36
There are 1,504,300 share options and no warrants in place at 30
June 2023 (1,594,500 share options at 30 June 2022).
4 STATUTORY ACCOUNTS
The Financial information set out in this announcement does not
constitute the Company's Consolidated Financial Statements for the
financial years ended 30 June 2023 or 30 June 2022 but are derived
from those Financial Statements. Statutory Financial Statements for
2022 have been delivered to the Registrar of Companies and those
for 2023 will be delivered following the Company's AGM. The
auditors Cooper Parry Group Limited have reported on the 2022 and
2023 financial statements. Their reports were unqualified, did not
draw attention to any matters by way of emphasis without qualifying
their report and did not contain statements under Section 498(2) or
(3) of the Companies Act 2006 in respect of the Financial
Statements for 2022 or 2021.
The Statutory accounts are available on the Company's website
and will be posted to shareholders who have requested a copy and
thereafter by request to the Company's reg
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END
FR EZLFLXKLXBBF
(END) Dow Jones Newswires
September 25, 2023 02:00 ET (06:00 GMT)
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