TIDMHAYD
RNS Number : 3138G
Haydale Graphene Industries PLC
01 March 2018
The information contained within this announcement is deemed by
the Group to constitute inside information as stipulated under the
Market Abuse Regulations (EU) No. 596/2014 ('MAR'). Upon the
publication of this announcement via a Regulatory Information
Service ('RIS'), this inside information is now considered to be in
the public domain.
For immediate release 1 March 2018
Haydale Graphene Industries plc
('Haydale', the 'Company', or the 'Group')
Interim Results
Haydale (AIM: HAYD), the global advanced materials group,
announces its unaudited interim results for the six months ended 31
December 2017 (the 'Period' or 'H1FY18').
Financial Highlights
-- 67% increase in total unaudited Group income for the Period
to approximately GBP2.49 million (H1FY17: GBP1.49 million)
delivered via:
o Advanced Materials SBU income of approximately GBP1.3 million (H1FY17: GBP0.8 million)
o Resins, Polymers and Composites SBU income of approximately
GBP1.2 million (H1FY17: GBP0.7 million)
-- 85% increase in commercial revenues for the Period to GBP2.04
million (H1FY17: GBP1.11 million)
-- Continued investment in R&D in the Period of GBP0.5
million (H1FY17: GBP0.7 million), including graphene enhanced
dispersion capabilities in Ammanford
-- Reduced Group loss from operations after tax for the Period
of GBP2.2 million (H1FY17: GBP2.4 million)
-- Investment in expanding processing capacity in the Period of
GBP0.2 million (H1FY17: GBP0.2 million)
-- Completion of a successful placing and offer in October 2017,
raising GBP9.3 million (before expenses) providing the necessary
cash resources to deliver on the Group's sales and growth
initiatives; and
-- Cash at period end of GBP8.0 million (30 June 2017: GBP2.1 million).
Operational Highlights
-- Created two Strategic Business Units ('SBU') with respective
senior management teams to drive sales and realise geographic
potential, which has delivered an increase in sales and commercial
opportunities as compared to H1FY17.
-- Advanced Materials SBU
o 45% increase in Silicon Carbide ('SiC') sales to GBP1.14
million (H1FY17: GBP0.8 million)
o Successful launch of newly developed SiC hard-edged cutting
tool moving us up the value chain
o Temporary ink production facility set up in Taiwan to meet
high levels of demand for samples of graphene and speciality inks;
and
o UK patent filed for Haydale's graphene based transparent
conductive ink used in proprietary anti-counterfeiting technology
known as PATit.
-- Resins, Polymers and Composite SBU
o New grant wins of GBP0.5 million for delivery in the current
and next financial year
o Improved dispersion capabilities in Ammanford supplying trial
graphene masterbatch for Flowtite A/S and other potential customers
for smart composites; and
o Sale of first phase of a novel composite panel making process
to Everpower's (Xiamen) China facility as demonstrator for targeted
automotive and aerospace customers.
Post Period End Highlights
Advanced Materials SBU ('AMAT')
-- Secured new sales orders worth approximately GBP0.5 million
since the end of the Period, including GBP0.3 million of which is
the supply, installation and commissioning of a HT60
functionalisation reactor to Thai quoted petro-chemical processor,
IRPC, together with ongoing research contracts to develop new
products for IRPC
-- Agreement with Japanese based Graphene Platform Corp to
supply graphene-based inks for sale into the Asian printed
electronics market, a sector dominated by APAC countries, growing
at over 20 per cent. per annum and predicted to be over US$12
billion by 2022
-- Commercial supply and development agreement signed with Talga
Resources Limited for the production, sales and marketing of
jointly developed transparent conductive ink products using
graphene for industrial applications in Asia, with initial focus on
material supply for Haydale's PATit anti-counterfeiting product;
and
-- Received follow on orders for evaluation of SiC in the newly
identified anti-corrosion powder coating market from US
customer.
Resins, Polymers and Composite SBU ('RPC')
-- Secured new contracts worth approximately GBP0.7 million
since the end of the Period, GBP0.6 million of which are new grant
funded projects for delivery in the current and subsequent
financial years on the following:
o evaluating the use of graphene sensors embedded into
composites materials which will reduce manufacturing time and
allows for in-situ assessment with no degradation of physical
properties
o enhanced electrical conductivity against lightning strikes
o use of conductive adhesives to remove lead-based solder from
aerospace structures
-- GBP0.1 million of which is follow on order from National Grid
to supply inspection covers for gas transition pieces ('GTP');
and
-- Successfully completed a second trial for the Flowtite A/S'
glass reinforced pipe ('GRP') systems on 28 February with the
expectation of results being available by the end of June 2018.
Commenting on the interim results, Ray Gibbs, CEO of Haydale,
said: "In the Period we have successfully commenced
commercialisation following the global expansion we achieved last
year. We now have an engineering-based advanced materials business
operating in the three principal world markets of the US, EU and
APAC. Our transition from technically focused research and
development to a sales-led operation is gathering momentum, but it
is not without its challenges. It requires focus and dedication,
with the right people in place and our introduction of dedicated
SBUs has been enormously helpful in achieving that focus. I am
delighted then to report a 67% increase in total income for this
half year and a 85% increase in commercial revenues demonstrating
the effect of our focus on sales.
Looking forward, and following our successful fundraising, we
have invested in our Taiwanese operation with a newly established,
initially temporary, ink production facility. The Taiwanese team
have been incredibly busy formulating ink samples to potential
customers' specifications who want to improve the performance of
their printed sensors, principally in the US$15 billion
self-monitoring blood glucose market. We are hopeful of securing
several meaningful orders and supply agreements from this key
strategic market and plan to move to a 10,000 sq. ft. facility by
the end of this financial year.
With the building blocks now in place, the next six to twelve
months should be an exciting time for the Group, which we believe
now has the customer engagement, geographic reach, engineering
solutions capability and product know how to create material change
in the Group's future revenues."
For further information:
Haydale Graphene Industries plc
Ray Gibbs, Chief Executive Officer Tel: +44 (0) 1269 842
946
Matt Wood, Finance Director www.haydale.com
Trevor Phillips, Head of Communications
Arden Partners plc (Nominated Adviser
& Broker)
Ruari McGirr / Paul Shackleton / Tel: +44 (0) 20 7614 5900
Ben Cryer
Media enquiries:
Buchanan
Henry Harrison-Topham / Jamie Hooper Tel: +44 (0) 20 7466 5000
haydale@buchanan.uk.com www.buchanan.uk.com
Notes to Editors
Haydale is a global technologies group and service provider that
facilitates the integration of graphene and other nanomaterials
into the next generation of industrial materials and commercial
technologies. With expertise in graphene, silicon carbide and other
nanomaterials, Haydale is able to deliver improvements in
electrical, thermal and mechanical properties, as well as
toughness. Haydale has granted patents for its technologies in
Europe, USA, Australia, Japan and China and operates from six sites
in the UK, USA and the Far East. For more information please visit:
www.haydale.com or Twitter: @haydalegraphene
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "will" or the negative of those, variations or
comparable expressions, including references to assumptions. These
forward looking statements are not based on historical facts but
rather on the Directors' current expectations and assumptions
regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the
amount, nature and sources of funding thereof), competitive
advantages, business prospects and opportunities. Such forward
looking statements re ect the Directors' current beliefs and
assumptions and are based on information currently available to the
Directors.
A number of factors could cause actual results to differ
materially from the results discussed in the forward looking
statements including risks associated with vulnerability to general
economic and business conditions, competition, environmental and
other regulatory changes, actions by governmental authorities, the
availability of capital markets, reliance on key personnel,
uninsured and underinsured losses and other factors, many of which
are beyond the control of the Company. Although any forward looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with such
forward looking statements. Accordingly, readers are cautioned not
to place undue reliance on forward looking statements. Subject to
any continuing obligations under applicable law or any relevant AIM
Rule requirements, in providing this information the Company does
not undertake any obligation to publicly update or revise any of
the forward looking statements or to advise of any change in
events, conditions or circumstances on which any such statement is
based.
Chief Executive Officers Report
Overview
I am delighted to present Haydale's unaudited interim results to
31 December 2017. Following on from our strategic acquisitions in
2016, the Group is now focused on sales growth through product
commercialisation. In July 2017, we established two sales oriented
strategic business units ('SBUs'): Advanced Materials ('AMAT') and
Resins Polymers and Composites ('RPC') to concentrate sales effort
and target customers who typically operate internationally across a
variety of sectors. Haydale now has routes to geographic markets
with a range of novel speciality performance enhancing
nanomaterials and products to add to its product portfolio and
graphene expertise. Crucially, the Group now has the capabilities
to combine its graphene and other nanomaterials and produce hybrid
'masterbatches' as we see this as the optimal way to significantly
improve end-product performance without crucially changing
downstream customer processing and overcome industry's reluctance
to handle powders.
The progress made in the establishment of the SBUs with
dedicated teams has made an immediate impact with like-for-like
income growth in the Period of approximately GBP0.5 million in each
SBU.
Haydale now has over 70 staff operating from six sites in three
geographic regions, where 11 Haydale patented plasma
functionalisation reactors are now deployed. With demand increasing
for our engineered solutions and masterbatch products, we plan to
expand our reactor numbers once known customer requirements are
finalised. We are now seeing demonstrable dispersion and
performance benefits from adding appropriate chemical groups on the
surface and ends of nano particles.
In the US, the Group's recently launched hard-edged cutting tool
product has already opened new customers and achieved almost GBP0.1
million of sales in the year to date from a standing start,
offering promising prospects for future growth. Our sales team in
the Far East is making good inroads into customers requiring
graphene and functional conductive inks, mainly from our Thailand
operation and our newly established, and initially temporary,
Taiwanese facility. The team in Taiwan has been incredibly busy
formulating ink samples to potential customers' specifications, who
want to improve the performance of their printed sensors,
principally in the US$15 billion self-monitoring blood glucose
market. We are hopeful of securing several meaningful orders and
supply agreements from this key strategic market.
Advanced Materials SBU ('AMAT')
Ceramics
The AMAT SBU delivered a 45 per cent. increase in sales of its
proprietary Silicon Carbide micro-fibres ('SiC') in the Period to
GBP1.14 million, as compared to the same period in 2016. This
significant uplift was aided by targeted investment in sales and
marketing activities in the US. Our operation in South Carolina has
been rebranded as Haydale Ceramic Technologies ('HCT') and, on a
like-for-like basis, doubled its number of customer engagements
(i.e. customers who have sampled HCT's products right through to
long term contracted customers) for the Period, including
generating sales in new territories, such as South Korea.
In the last year, HCT has invested in product development to
open up new markets and has had an encouraging start to sales of
its newly developed hard-edged cutting blanks, used for fashioning
products such as aircraft engine and land-based fan blades from
super alloys, generating maiden revenues of almost GBP0.1
million.
Penetration into the newly identified anti-corrosion powder
coating market of HCT's SiC is also progressing well, with a
potential new customer currently undergoing trials at two sites in
the US. The opportunity for Haydale is to incorporate silicon
carbide into epoxy-based coatings for ferrous structures. Follow on
orders for evaluation in this high growth market have continued in
both January and February 2018, and the Group is working towards
being able to supply commercial quantities over the next six to
nine months.
Inks and Coatings
Haydale's temporary facilities in Taiwan were successfully
audited during the Period by two leading ink screen-printing
corporations, one of which operates in biomedical sensors for the
growing global diabetes market. Following the Group's successful
fundraise in October 2017, investment in infrastructure and
scale-up in Taiwan has started to deliver increased capacity and
capabilities in anticipation of increased demand. During the
Period, the Group sold and supplied bespoke samples of its graphene
enhanced and functional inks for product evaluation and testing to
more than 30 companies in the APAC region. Increasing customer
engagements are such that the Group plans to move to a 10,000 sq.
ft. facility in Kaohsiung by the end of the current financial year,
which will be capable of meeting significant demand for our
graphene-based and speciality conductive ink products.
Following a successful first trial, a second safety trial is
underway by a leading Korean cookware manufacturer, who has
incorporated Haydale's functionalised graphene nano-platelets
within the inner coating of their pots and pans. Through Haydale's
operations in Thailand, the Group has targeted three major Thai
cookware manufacturers who are seeking improvements in the thermal
performance of their next generation cookware products.
We are pleased to report that the Group's Thai operation has
sold, and is to install and commission, a HT60 reactor to a leading
Thai petrochemical processor, IRPC, before the end of June 2018.
This reactor sale includes a follow-on research contract worth
approximately GBP0.3 million to our Thai operation over the next 12
months. The research contract includes functionalising certain of
IRPC's bi-products to specifically improve electrical performance
and increase value.
Resins, Polymers and Composites SBU ('RPC')
The RPC SBU has delivered strong sales growth in the Period. A
second trial for Haydale's graphene-enhanced resin system for
Flowtite A/S's GRP pipes was carried out on 28 February 2018,
following encouraging initial evaluation reports in September 2017.
The expectation is for the test results to be received by the end
of June 2018.
In the Period, Haydale has secured new grant funded projects of
GBP0.5 million for delivery in this and into the next financial
year. Each grant project secured is intended to lead to the
development, and ultimately sale, of a next generation product and
allows Haydale to work alongside some significant international
corporations. More pleasingly, since the Period end, our dedicated
team has secured a further approximate GBP0.7 million of additional
grant and commercial projects funding for delivery over the
remainder of the current year and into subsequent financial years.
Two of these awards are in the aerospace sector, one being a
follow-on from our successful graphene conductive aileron project
demonstrating the feasibility to counter lightning strike and the
other, being the development of a graphene conductive adhesive, to
be used in aerospace applications aimed at removing the need for
lead based solder.
The composite industry is looking to make structures smart and
provide self-diagnostics. Included within the grant awards secured
above, Haydale has won, as part of a GBP1.3 million consortium, a
project grant aimed at embedding diagnostic graphene sensors into a
composite structure, where the value to Haydale is approximately
GBP0.25 million over the next 18 months. The project applies
graphene to a customised composite substrate to achieve real time
defect sensing, during the manufacturing process of a composite
where crucially, the mechanical performance is not degraded. The
graphene sensors are to be embedded into the composite material,
delivering whole life savings for the asset owner, through reduced
manufacturing time and in-situ assessment. A new generation smart
material.
In our traditional thermoset market, following the recent
delivery to National Grid of the first batch of Haydale's
proprietary composite gas transition inspection covers, a repeat
order for GBP0.11 million has been secured for delivery in the
current financial year.
Intellectual property
Haydale continues to add to its IP base, with both know-how and
granted patents. Increasingly, the knowledge-based systems in our
business have taken on more prominence rather than the process
patents. This is especially true for the dispersion capability we
have developed in our operations. The Group's intention remains to
secure added protection through the development of product patents
which we have filed for graphene products, such as pressure
sensors, printed heated garments for sporting goods and PATit, our
transparent conductive ink used in anti-counterfeiting.
We are also pleased to report that the Group was advised in
September 2017 that the North American patent office has granted a
patent on Haydale's patented plasma process. This will ensure that
Haydale's functionalisation process will be protected in the US,
UK, Europe, Japan, China, and Australia.
Financial Results
Total unaudited income recognised in the period, which comprised
commercial revenue and income from grant projects, was up more than
67 per cent. on the same period last year at GBP2.49 million
(H1FY17: GBP1.49 million). The Group's forward order book remained
strong at the end of the Period at GBP4.75 million, which we are
pleased to report has grown to approximately GBP5.4 million as of
today's date, providing improved visibility on future income. Both
SBUs recorded income increases of approximately GBP0.5 million on a
like-for-like basis, with AMAT posting sales of GBP1.3 million and
RPC delivering income of GBP1.2 million in the Period. The Group's
gross margin for the Period reduced to approximately 60% compared
to 70% in the prior period, due principally to a change in product
mix sold by HCT which is set to continue for the foreseeable
future.
As Haydale transitions to commercial sales its own investment in
development projects has reduced in the six months under review.
Total R&D expenditure was approximately GBP0.5 million (H1FY17:
GBP0.7 million), of which GBP0.4 million was expensed in the
period, with GBP0.1 million being capitalised and will be amortised
over 20 years. Other administration costs during the Period
totalled GBP3.77 million, up from GBP3.04 million in the
corresponding period last year, due principally to an increased
headcount across the Group and an inclusion of a full six months'
of HCT's costs in the Period, which the Group acquired in
mid-October 2016. The Group expects to report other admin costs in
the second half of the current financial year to be broadly similar
to those incurred in the Period. Expenditure on capital equipment
during this period was GBP0.2 million, similar to that spent in
H1FY17. Loss for the Period from continuing operations was GBP2.2
million, a reduction of GBP0.2 million from the same period last
year.
Given the Group's increasing international presence, its
reported financial performance, especially when comparing to prior
periods, is impacted marginally by changes in foreign exchange
rates, in particular movements in the GBP/US$ exchange rate. The
Group takes reasonable steps to minimise the effect of changes in
FX rates to its performance and position, notwithstanding that the
recent 5% strengthening of the GBP vs the US$ in the first two
months of 2018 compared to the average during the Period is likely
to impact marginally on the Group's reported income for the current
financial year.
The Group's unaudited net assets at 31 December 2017 were
GBP15.4 million (31 December 2016: GBP7.8 million). The Group's
borrowings reduced GBP0.3 million during the Period to GBP1.0
million at the period end (30 June 2017: GBP1.3 million). Cash at
the period end was GBP8.0 million (30 June 2017: GBP2.1m),
bolstered by the equity fundraising during the Period which raised
GBP9.3 million (before expenses) through the issue of 7,731,060 new
Ordinary Shares at a price of GBP1.20 to new and existing
investors. As at 31 December 2017 and at the date of this
announcement, the Company has 27,328,773 ordinary shares in
issue.
Board changes
During the Period, John Knowles retired as Chairman and was
replaced by David Banks. We are extremely grateful to John for his
contribution to the Group, especially through its listing process
in 2014, and the Board wishes him well for the future. David joins
the Group at an exciting inflection point, with income growth now
at almost 70 per cent. period-on-period, and we look forward to
benefiting from David's wise counsel and guidance as we drive
towards profitability.
Outlook
Whilst Haydale's activities were expansion focused in the
previous financial year, we can see an even greater level of
activity now that we have both product sales and a pipeline of
engineered performance enhancing applications for customers with
known requirements starting to generate income across the
Group.
The Group's transition from technically focused research and
development to a sales-led operation is gathering momentum, but it
is not without its challenges. It requires focus and dedication,
with the right people in place and our introduction of dedicated
SBUs has been instrumental in achieving that focus.
Haydale's geographic coverage and expanding product base offers
a unique proposition in the graphene and advanced materials world
in which we operate. The Group has won new business in the US,
through a focused sales effort and investment in new products. Our
Far East graphene and functional inks business now has foundations
in place and its pipeline of potential new customers looks strong,
especially around FDA approved inks for bio-medical diabetes
testing sensors. We are making investment in the region to
accommodate the expected growth in graphene and speciality inks,
based around our new facility in Taiwan. Our three APAC units (S.
Korea, Thailand, and Taiwan) work well together, with complimentary
skill sets.
The composite industry is inherently conservative and dominated
by large corporates who plan carefully and thoroughly. Hence, the
lesson we have learned is that their desire for implementation of
new products takes time and resources, albeit the results can be
significant in revenue generation. The traditional composite-based
application engineering solutions consultancy in Loughborough and
the processing and dispersion team in Ammanford have been working
well together such that they have several potential contracts under
discussion utilising their traditional skills whilst now
incorporating property enhancements from using graphene and other
nanomaterials at their disposal. The Group's dispersion
capabilities will be crucial in its push to commercialise composite
products.
The Haydale team is clearly focused on revenue generation and
the drive to profitability, building on the almost 70 per cent.
increase in revenue generation delivered in the period under
review. We look forward to reporting future success and news in the
coming months.
Ray Gibbs
Chief Executive Officer
1 March 2018
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)
For the six months ended 31 December 2017
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec 2017 31 Dec 2016 30 Jun 2017
Note GBP'000 GBP'000 GBP'000
REVENUE 2,041 1,106 3,004
Cost of sales (852) (313) (894)
Gross Profit 1,189 793 2,110
Other income 456 384 901
Administrative expenses
-------------------------------------------- -------- -------------- -------------- --------------
Research and development expenditure (433) (548) (908)
Share based payment expense (114) (187) (351)
Other administrative expenses (3,768) (3,037) (7,090)
-------------------------------------------- -------- -------------- -------------- --------------
(4,315) (3,772) (8,349)
LOSS FROM OPERATIONS (2,670) (2,595) (5,338)
Finance costs (69) (29) (297)
LOSS BEFORE TAXATION (2,739) (2,624) (5,635)
Taxation 557 221 883
LOSS FOR THE PERIOD FROM CONTINUING
OPERATIONS (2,182) (2,403) (4,752)
Other comprehensive income:
Items that may be reclassified to
profit or loss:
Exchange differences on translation
of foreign operations - - (74)
Remeasurements of defined benefit
pension scheme (148) - (36)
TOTAL COMPREHENSIVE LOSS FOR THE
PERIOD FROM CONTINUING OPERATIONS (2,330) (2,403) (4,862)
Loss per share attributable to owners
of the Parent
Basic (GBP) 2 (0.10) (0.15) (0.28)
Diluted (GBP) 2 (0.10) (0.15) (0.28)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)
As at 31 December 2017
Unaudited Unaudited Audited
31 Dec 2017 31 Dec 2016 30 Jun 2017
GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Goodwill 2,088 - 2,115
Intangible assets 2,110 2,042 2,152
Property, plant and equipment 4,848 5,287 5,074
Deferred tax asset 536 - 679
9,582 7,329 10,020
Current assets
Inventories 1,237 1,048 1,212
Trade receivables 566 466 798
Other receivables 451 884 535
Corporation tax 441 547 280
Cash and bank balances 7,992 1,127 2,091
10,687 4,072 4,916
TOTAL ASSETS 20,269 11,401 14,936
LIABILITIES
Non-current liabilities
Bank loans 752 1,120 911
Deferred tax 687 - 1,234
Pension obligation 1,095 - 969
2,534 1,120 3,114
Current liabilities
Bank loans 272 506 359
Trade and other payables 1,975 1,631 2,305
Deferred income 66 304 253
2,313 2,441 2,917
TOTAL LIABILITIES 4,847 3,561 6,031
TOTAL NET ASSETS 15,422 7,840 8,905
EQUITY
Capital and reserves attributable to
equity holders of the parent
Share capital 547 349 392
Share premium account 27,539 15,356 18,936
Share-based payment reserve 1,121 843 1,007
Retained (deficits) / profits (13,647) (8,520) (11,317)
Foreign exchange reserve (138) 83 (113)
Other reserves - (271) -
TOTAL EQUITY 15,422 7,840 8,905
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
For the six months ended 31 December 2017
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec
2017 31 Dec 2016 30 Jun 2017
GBP'000 GBP'000 GBP'000
Cash flow from operating
activities
Loss before taxation (2,739) (2,624) (5,635)
Adjustments for:-
Amortisation of intangible
assets 102 35 157
Capitalised loan costs
written off - - 77
Depreciation of property,
plant and equipment 320 250 560
Share-based payment charge 114 187 351
(Profit)/Loss on disposal 51 - -
of property, plant and
equipment
Finance costs 69 29 297
Net interest expense 20 - -
Operating cash flow before
working capital changes (2,063) (2,123) (4,193)
(Increase)/ decrease in
inventories (25) 152 (12)
Decrease / (increase)
in trade and other receivables 316 (620) (596)
(Decrease) / increase
in payables and deferred
income (517) 170 260
Income tax received - 54 412
Net cash flow from operating
activities (2,289) (2,367) (4,129)
------------ ------------- -------------
Cash flow used in investing
activities
Purchase of property,
plant and equipment (247) (225) (415)
Purchase of intangible
assets (80) - (245)
Proceeds from disposal 20 - -
of property, plant and
equipment
Acquisition of subsidiary
net of cash acquired - 4 4
Purchase of non-controlling
shareholding - - (413)
Net cash flow in investing
activities (307) (221) (1,069)
------------ ------------- -------------
Cash flow used in financing
activities
Finance costs (69) (29) (297)
Proceeds from issue of
share capital 9,277 2,591 6,058
Share issue costs (520) (157) -
New bank loans raised - 1,405 1,408
Repayments of borrowings (259) (2,921) (2,817)
Net cash flow from financing
activities 8,429 889 4,352
------------ ------------- -------------
Effects of exchange rate
changes 68 (36) 75
Net increase / (decrease)
in cash and cash equivalents 5,901 (1,735) (771)
Cash and cash equivalents
at beginning of the financial
period 2,091 2,862 2,862
Cash and cash equivalents
at end of the financial
period 7,992 1,127 2,091
============ ============= =============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
Share
based Foreign
Share Share payment exchange Retained Other
capital premium reserve reserve profits reserves Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 July 2016 305 11,840 656 (39) (6,117) (44) 6,601
Comprehensive
loss for
the period - - - - (2,403) - (2,403)
Recognition of
share-based
payments - - 187 - - - 187
Issue of
ordinary
share
capital 44 3,673 - - - - 3,717
Transaction
costs in
respect of
share issues - (157) - - - - (157)
Other
Comprehensive
Income - - - - - (227) (227)
Currency
Reserve - - - 122 - - 122
---------- ---------- ---------- ---------- ------------------ ----------- ---------
At 31 December
2016 349 15,356 843 83 (8,520) (271) 7,840
Comprehensive
loss for
the period - - - - (2,348) - (2,348)
Recognition of
share-based
payments - - 164 - - - 164
Issue of
ordinary
share
capital 43 3,580 - - - - 3,623
Retirement
benefit
obligations - - - - (36) - (36)
Repurchase of
NCI - - - - (413) 44 (369)
Other
comprehensive
loss - - - - - 227 227
Foreign
currency
reserve - - - (196) - - (196)
---------- ---------- ---------- ---------- ------------------ ----------- ---------
At 30 June
2017 392 18,936 1,007 (113) (11,317) - 8,905
Comprehensive
loss for
the period - - - (2,182) - (2,182)
Recognition of
share-based
payments - - 114 - - 114
Issue of
ordinary
share
capital 155 8,603 - - - 8,758
Other
Comprehensive
Income - - - (148) - (148)
Currency
Reserve - - - (25) - - (25)
At 31 December
2017 547 27,539 1,121 (138) (13,647) - 15,422
========== ========== ========== ========== ================== =========== =========
Equity share capital and share premium
The balance classified as share capital and share premium
includes the total net proceeds on issue of the Company's equity
share capital, comprising GBP0.02 ordinary shares. The share
premium account can only be used for bonus issues, to provide for
the premium payable on redemption of debentures or to write off
preliminary expenses, or expenses of, or commissions paid on, or
discounts allowed on, any issues of shares or debentures of the
Company.
Share premium account
The share premium account represents the amount received on the
issue of ordinary shares in excess of their nominal value and is
non-distributable.
Share-based payment reserve
The share-based payment reserve comprises the cumulative expense
representing the extent to which the vesting period of share
options has expired and management's best estimate of the
achievement or otherwise of non-market conditions and the number of
equity instruments that will ultimately vest.
Retained profits
The retained profits reserve comprises the cumulative effect of
all other net gains, losses and transactions with owners (e.g.
dividends) not recognised elsewhere.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the six months ended 31 December 2017
1. Accounting policies
Basis of preparation
The interim financial statements, which are unaudited, have been
prepared on the basis of the accounting policies expected to apply
for the financial year to 30 June 2018 and in accordance with
recognition and measurement principles of International Financial
Reporting Standards (IFRSs) as endorsed by the European Union. The
accounting policies applied in the preparation of these interim
financial statements are consistent with those used in the
financial statements for the year ended 30 June 2017.
The interim financial statements do not include all of the
information required for full annual financial statements and do
not comply with all of the disclosures in IAS34 'Interim Financial
Reporting'. Accordingly, while the interim financial statements
have been prepared in accordance with IFRS they cannot be construed
as being in full compliance with IFRS.
The financial information for the year ended 30 June 2017 does
not constitute the full statutory accounts for that period. The
Annual Report and Accounts for 30 June 2017 have been filed with
the Registrar of Companies. The Independent Auditors' Report on the
Annual Report and Accounts for 2017 was unqualified and did not
include references to any matters which the auditors drew attention
to by way of emphasis without qualifying their report and did not
contain statements under Section 498(2) or 498(3) of the Companies
Act 2006.
Going concern
The consolidated financial statements are prepared on a going
concern basis which the Directors believe continues to be
appropriate. The Group meets its day-to-day working capital
requirements through existing cash resources which, at 31 December
2017 amounted to GBP7.99 million. The Directors have prepared cash
flow projections for the period ending no less than 12 months from
the date of their approval of these financial statements. On the
basis of those projections, the Directors believe that the Group
will be able to continue to trade for the foreseeable future.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the six months ended 31 December 2017
2. Loss per share
The calculations of loss per share are based on the following
losses and number of shares:
Unaudited Unaudited Audited
six months six months Year
ended ended ended
31 Dec 2017 31 Dec 2016 30 Jun 2017
GBP'000 GBP'000 GBP'000
Loss after tax attributable
to owners of the Haydale
Graphene Industries Group (2,182) (2,403) (4,752)
Weighted average number
of shares:
- Basic 22,202,744 16,078,679 17,232,137
- Diluted 22,202,744 16,078,679 17,232,137
Loss per share:
- Basic (GBP) (0.10) (0.15) (0.28)
- Diluted (GBP) (0.10) (0.15) (0.28)
The loss attributable to ordinary shareholders and weighted
average number of ordinary shares for the purpose of calculating
the diluted earnings per ordinary share are identical to those used
for basic earnings per share. This is because the exercise of share
options would have the effect of reducing the loss per ordinary
share and is therefore not dilutive under the terms of IAS 33.
3. Approval
The 31 December 2017 interim financial statements were approved
by a duly appointed and authorised committee of the Board of
Directors on 28 February 2018.
- ENDS -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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