TIDMQXT
RNS Number : 5070A
Quixant PLC
30 September 2020
30 September 2020
Quixant plc
("Quixant" or the "Group")
Interim Results
Quixant (AIM: QXT), a leading provider of innovative, highly
engineered technology products principally for the global gaming
and broadcast industries, announces its Unaudited Interim Results
for the six months ended 30 June 2020.
While the Group's revenue and profits in the first half of 2020
were impacted by the COVID-19 pandemic, resilient trading from
Densitron, careful management of our gaming customers and prompt
management of overheads have enabled the business to end the half
with a healthy net cash position. As previously communicated,
trading over the period was better than the severe downside
modelling case outlined in the March 2020 trading update.
Financial highlights:
-- Group revenue of $27.9m (H1 2019: $41.9m)
o Quixant Gaming division revenue of $11.9m (H1 2019: $23.6m)
- Gaming platforms revenue of $10.6m (H1 2019: $19.6m)
- Gaming monitors revenue of $1.3m (H1 2019: $4.0m)
o Densitron division revenue of $16.0m (H1 2019: $18.4m)
-- Gross margins remain robust at 36% (H1 2019: 36%)
-- Group adjusted pre-tax loss(1) of $1.2m (H1 2019: $3.4m profit)
-- Group reported pre-tax loss of $3.0m (H1 2019: $3.0m profit) after
a $1.3m write off of capitalised R&D
-- Adjusted fully diluted EPS of ($0.0184)/share (H1 2019: $0.0506/share)
-- Fully diluted EPS of ($0.0453)/share (H1 2019: $0.0346/share)
-- Net cash from operating activities of ($0.3m) (H1 2019: $6.7m)
-- Net cash at 30 June 2020 of $14.2m (30 June 2019: $12.4m), improving
to $17.4m at 28 September 2020
1. Adjusted by adding back items included in the adjusted PBT
reconciliation in note 1 totaling $1.8m (H1 2019: $0.4m).
Operational highlights:
-- Initiatives deployed rapidly to mitigate the COVID-19 impact, protecting
the wellbeing of staff, supporting customers through challenges in
supply chain and working capital, safeguarding our balance sheet and
positioning Quixant well for recovery.
-- Organisational enhancements include the formation of an Executive
Committee, the streamlining of our cost base and improvements in forecasting
and reporting facilitated by new SAP system.
-- Continued strong customer retention through the crisis
-- Post-period appointment of Andrew Jarvis as interim Chief Financial
Officer
Current trading and outlook:
-- Gradual improvement in Gaming division revenues since venues began
to re-open in May, with early signs of recommencement in orders and
deliveries and new business wins early in the second half
-- Leveraging our strong customer relationships to seek new opportunities
which will drive the recovery of Gaming division revenues
-- Densitron remains resilient despite COVID-19 and we expect to post
growth in the broadcast and medical markets in 2020
-- Expect a return to profitable trading in the second half, offsetting
some of the reported loss experienced in the first half, with this
recovery continuing into 2021, excepting the impact of any further
widespread global lockdowns as a result of COVID-19
-- Well positioned to return to growth in the medium to long term
Jon Jayal, CEO of Quixant, commented:
"I am delighted with the way our team has risen to the
unprecedented challenges of the last six months and delivered
results significantly better than in the pessimistic scenarios
considered as part of our 2019 year end audit and presented in
March 2020. We moved quickly to adjust to different working
conditions alongside the rapid and significant changes in demand
from customers. Thanks to strict financial discipline and close
collaboration with our customers we have maintained a healthy net
cash balance and have strengthened many of our customer
relationships further. This puts Quixant in a strong position to
benefit from the recovery in our global end markets.
Alongside this we see a clear opportunity to draw on our history
of innovation, stepping up to deliver what customers are looking
for from us now. We are working on introducing new business models
with the aim of unlocking more repeatable revenue streams and grant
us access to new market opportunities.
Quixant is a strong business with excellent customer
relationships and innovation at our core which, combined with our
strong financial position, we believe will drive excellent
stakeholder value over the long term."
For further information please contact:
Quixant plc Tel: +44 (0)1223
892 696
Jon Jayal, Chief Executive Officer
Andrew Jarvis, Interim Chief Financial
Officer
Nominated Adviser and Broker:
finnCap Ltd Tel: +44(0)20 7220
0500
Matt Goode / Simon Hicks / Edward Whiley
(Corporate Finance)
Alice Lane (Corporate Broking)
Financial PR: Tel: +44 (0) 20
3405 0205
Alma PR
John Coles / Susie Hudson / David Ison
About Quixant
Quixant, founded in 2005, designs and manufactures highly
optimised computing solutions and monitors principally for the
global gaming and broadcast industries. The Company is
headquartered in Cambridge in the UK where the global sales
function is based. North America sales and sales support is run
from their subsidiary in Las Vegas. Quixant has its own
manufacturing and engineering operation based in Taiwan and
software engineering and customer support team based in Italy. All
the specialised products software and manufacturing are produced
in-house and Quixant owns all its own IP some of which is protected
by patents and design rights.
In November 2015 Quixant acquired Densitron Technologies plc.
Densitron has a strong heritage in the sale of electronic display
solutions to global industrial markets. Through Densitron's
experienced sales team, Quixant has a robust platform to build its
business into wider industrial markets. In-depth information on the
Company's products, markets, activities and history can be found on
the corporate website at www.quixant.com.
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
CHAIRMAN'S STATEMENT
While the outbreak of the COVID-19 pandemic in the period
presented us with unexpected and significant challenges, the
business has navigated them well, retaining a healthy balance sheet
and laying the foundations that will enable it to grow strongly as
our global end markets normalise. With a strong platform and having
identified several new commercial opportunities while working
through this unusual period, we believe we are well-positioned to
capture market share in gaming, broadcast and medical markets.
We have taken the opportunity during the quieter trading period
to introduce and accelerate enhancements to the operational side of
the business. We recently formed an Executive Committee comprising
leaders from the Gaming and Densitron divisions and led by the
Chief Executive. This drives collaboration between the two business
units, promoting better sharing of information and resources and
enabling them to contribute more impactfully to the success of the
group. We are pleased with the performance of the new gaming and
Densitron senior executives introduced to the business over the
last two years.
Post-period we welcomed Andrew Jarvis as interim Chief Financial
Officer following the departure of Guy Milward. Andrew brings with
him experience in leading high-performing finance teams and an
understanding of international business. He has quickly been able
to pick up the reins, helped by a short handover period with Guy.
On behalf of the Board, I would like to thank Guy for his
contribution to the business since he joined in October 2018 and
wish him well in his future endeavours.
We continue the process of appointing a senior independent
non-executive director to the Board and will update the market on
the matter in due course.
OPERATING REVIEW
In response to the particularly challenging trading conditions
of the first half of the year, we outlined a plan with five key
objectives: to prioritise the safety of our colleagues, to preserve
the strength of the Group's balance sheet, to support our customers
and suppliers, to optimise our operations and to identify new
opportunities to capitalise on as global economies reopen. While it
has been a difficult period, we have made good progress against all
these objectives, and trading has been better than the severe
downside modelling case outlined as part of the audit process for
the 2019 financial year and announced in March 2020.
Gaming Division
The gaming and slot machine industry, a core end market for the
Group's computer and monitor products, underwent an unprecedented
global shutdown as governments sought to curb the spread of the
COVID-19 pandemic. Initially in Asia and then later in Europe, the
Americas and Australasia; casinos, bingo halls, bars, clubs and
pubs were closed for several months with Q2 commercial casino
revenues down 79% year on year, improving to 46% down year to date.
Consequentially we saw a rapid decline in demand for our gaming
computer platform and monitor products from March onwards, and weak
trading for a large proportion of the second quarter. However, in
May we started to see the gradual reopening of venues across North
America, with 85% of US casinos now open. This has driven a slow
improvement in gaming revenues which, in the absence of a further
widespread lockdown, we expect to continue to improve. In the
period since opening, player attendance and spend in most venues
(outside of the tourist resorts such as
Las Vegas) has been healthy.
During this period, many of the gaming machine manufacturers
have been forced to take extraordinary actions to survive the
period which have included deep staff furloughing/redundancies,
working capital control schemes and refinancing of debt. As venues
reopened and players returned, our customers faced difficult
decisions around the pace with which to reinstate staff. The
majority of our Gaming customers are currently operating at
significantly reduced staff levels compared to pre-outbreak. Allied
with significant working capital pressures, these resource
constraints represent an opportunity for Quixant, as an outsource
provider of gaming market-focused technology solutions, to support
customers' recovery with new technology and novel business models.
As we emerge from the impact of COVID 19, we believe there is an
opportunity for customers to outsource more of their hardware and
software to Quixant as they face difficult decisions over
utilisation of resources in their business. We are therefore
investigating hardware full-service offerings and deepening our
"middleware" software stack to enable customers to divert resources
solely on content creation. We believe these augmentations of our
value proposition can also unlock repeatable revenue business
models.
Given the cancellation or postponement of many sporting events
in 2020, the global sports betting market has been severely
impacted by the pandemic. We have therefore decided to pause
further work on developing and marketing products specifically for
this market for the time being.
Densitron Division
The Densitron business has proven relatively resilient amid the
challenging circumstances. While we have seen delays in orders and
new business in certain segments including broadcast, we are
expecting to see full year growth in these sectors against
prior.
Broadcast sector revenues have been somewhat delayed by the
slowdown in the installation of new hardware into broadcast studios
through the lockdown. We expect to see some of this recovered
during the second half of the year, alongside growing revenues and
an increased focus on the Healthcare sector. Overall Broadcast and
Healthcare revenues are expected to grow year on year, and
currently represent approximately 15% and 20% of Densitron's
revenues.
Our Densitron business strategy is to move further up the value
chain from display-only technology towards complete control
solutions with focus on specific verticals. We were therefore
delighted to be selected in May 2020 as a Panasonic KAIROS Alliance
Partner, a next generation live production platform that enables
incredible productivity, recognising the innovation we are bringing
in Human-Machine Interaction to the broadcast sector. Panasonic
will be using products from Densitron's UReady(R) tactile touch
screen product range which also integrate our embedded computing
solutions. This provides Panasonic with cutting-edge control
surfaces for their new KAIROS IT/IP live video production
solutions.
Financial review
First half revenues were $27.9m (2019 H1: $41.9m), with the
Gaming Division contributing $11.9m (2019 H1: $41.9m) and Densitron
$16.0m (2019 H1: $18.4m). Despite the COVID-19 pandemic's stark
impact on revenue, prompt action to contain costs resulted in an
adjusted pre-tax loss of $1.2m (2019 H1: Profit of $3.4m).prior to
a $1.3m write off of capitalised R&D brought about by the need
to end-of-life certain product lines early due to changing market
demands and supply chain issues brought about by the pandemic,
a$0.4m amortisation charge relating to customer relationships and
order backlog, and a $0.1m share based payments expense - resulting
in a reported pre tax loss of $3.0m (2019 H1: Profit of $3.0m).
Continued healthy Densitron trading in most sectors and stronger
than anticipated cash collection from Gaming division customers
meant we have retained a strong net cash position of $14.2m at 30
June 2020 (31 December 2019: $16.1m) and unutilised credit lines of
$12.4m available. Since June we have seen an increase in net cash
to $17.4m at 28 September 2020.
The Group continues to maintain a strong balance sheet. Net
assets at 30 June 2020 were $62.3m compared with $65.3m at 31
December 2019 and $59.0m at 30 June 2019, with long term debt of
$0.7m.
The global COVID-19 pandemic in H1 2020 resulted in a slowdown
of product movement in the Group, which has seen inventory levels
increase from $20.2m at 31(st) December 2019, to $22.9m at 30(th)
June 2020. We expect this to unwind over the coming months as
deliveries resume. The global pandemic has caused significant
disruption in electronic component production such that we are
experiencing volatile pricing, unpredictable lead times and
unexpected end-of-life notices served on us by our suppliers. The
Group has been carefully monitoring the situation and where
necessary taking action to make strategic purchasing decisions to
protect customers and reviewing the viability of its future product
roadmap. Cash generation in the period was slow due to the effects
of the global pandemic, and mitigation measures were put in place
to protect the business.
In 2019, a dividend payment of 3.1p per share, totalling $2.8m
was made in May 2019. This was in respect of the full year 2018 and
represented the sixth dividend payment made by the Group. Due to
the ongoing effects of the pandemic and to maintain a robust
balance sheet, the Board has decided not to pay a dividend in 2020.
We currently expect to return to paying dividends in 2021.
Business Optimisation
We took prompt action to manage cost in the early part of the
second quarter and as a result, overall, we expect 2020 overheads
to be over 15% lower than in our original budget. These cost
savings have been possible through bringing Gaming and Densitron
teams closer together in several areas such as operations, finance
and product development, and through a process of streamlining our
Gaming product range. The Gaming market requirement to buy products
with a long supply lifetime has led to a long tail of older
products which are expensive to support. We have seen several of
our suppliers issuing an "end-of-life notice" on components citing
reduced market demand from their end customers' products. As a
result we have had to follow suit and manage customers onto newer
products. We have therefore written off $1.3m of capitalised
R&D expenses.
Outlook
Since the end of the second quarter, we have seen a gradual
improvement in Gaming revenues, including a number of new business
wins and the continuation of resilient Densitron revenues.
Excepting any further widespread global lockdowns, we expect a
return to profitable trading in the second half, offsetting some of
the reported loss experienced in the first half, with this recovery
continuing into 2021.
CONDENSED CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER
COMPREHENSIVE INCOME
FOR THE SIX MONTHSED 30 JUNE 2020, 30 JUNE 2019 AND YEARED 31
DECEMBER 2019
Unaudited 30 June 2020 Unaudited 30 June 2019 31 December 2019
Note
$000 $000 $000
---------------------------------- ------- ----------------------- ----------------------- -----------------
Revenue 27,901 41,943 92,320
------- ----------------------- ----------------------- -----------------
Cost of sales (17,938) (26,672) (58,033)
------- ----------------------- ----------------------- -----------------
Gross profit 9,963 15,271 34,287
------- ----------------------- ----------------------- -----------------
Operating expenses (12,971) (12,268) (24,733)
------- ----------------------- ----------------------- -----------------
Operating (loss) / profit (3,008) 3,002 9,554
------- ----------------------- ----------------------- -----------------
Financial expenses (40) (42) (136)
------- ----------------------- ----------------------- -----------------
(Loss) / Profit before tax 1 (3,048) 2,961 9,418
------- ----------------------- ----------------------- -----------------
Taxation 20 (653) (1,102)
------- ----------------------- ----------------------- -----------------
(Loss) / Profit for the period (3,028) 2,307 8,316
------- ----------------------- ----------------------- -----------------
Other comprehensive expense
------- ----------------------- ----------------------- -----------------
Foreign currency translation
differences (59) (143) (144)
------- ----------------------- ----------------------- -----------------
Total comprehensive income for the
period (3,087) 2,164 8,172
------- ----------------------- ----------------------- -----------------
Basic earnings per share 2 ($0.0456) $0.0348 $0.1252
------- ----------------------- ----------------------- -----------------
Fully diluted earnings per share 2 ($0.0453) $0.0346 $0.1243
------- ----------------------- ----------------------- -----------------
The above condensed consolidated statement of profit and loss
and other comprehensive income should be read in conjunction with
the accompanying notes.
BALANCE SHEET
AS AT 30 JUNE 2020, 30 JUNE 2019 AND AT 31 DECEMBER 2019
Unaudited 30 June 2020 Unaudited 30 June 2019 31 December 2019
Note
$000 $000 $000
------------------------------------------ ----------------------- ----------------------- -----------------
Non-current assets
-------- ----------------------- ----------------------- -----------------
Property, plant and equipment 5,757 5,947 5,926
-------- ----------------------- ----------------------- -----------------
Right-of-use asset 251 1,223 894
----------------------- ----------------------- -----------------
Intangible assets 17,078 15,473 18,449
----------------------- ----------------------- -----------------
Investment property - 633 -
-------- ----------------------- ----------------------- -----------------
Deferred tax assets 426 157 340
----------------------- ----------------------- -----------------
Total non-current assets 23,512 23,433 25,609
----------------------- ----------------------- -----------------
Current assets
-------- ----------------------- ----------------------- -----------------
Inventories 22,857 22,852 20,180
----------------------- ----------------------- -----------------
Trade and other receivables 17,571 27,092 23,902
----------------------- ----------------------- -----------------
Cash and cash equivalents 15,842 13,245 16,954
----------------------- ----------------------- -----------------
Total current assets 56,270 63,189 61,036
----------------------- ----------------------- -----------------
Total assets 79,782 86,622 86,645
----------------------- ----------------------- -----------------
Current liabilities
-------- ----------------------- ----------------------- -----------------
Other interest-bearing loans and
borrowings (953) (85) (82)
-------- ----------------------- ----------------------- -----------------
Trade and other payables (13,783) (24,028) (17,756)
----------------------- ----------------------- -----------------
IFRS 16 lease liability (279) (466) (406)
----------------------- ----------------------- -----------------
Total current liabilities (15,015) (24,580) (18,244)
----------------------- ----------------------- -----------------
Non-current liabilities
-------- ----------------------- ----------------------- -----------------
Other interest-bearing loans and
borrowings (724) (775) (738)
-------- ----------------------- ----------------------- -----------------
Provisions (314) (338) (343)
Deferred tax liabilities (1,469) (1,081) (1,469)
IFRS 16 lease liability - (810) (564)
----------------------- ----------------------- -----------------
Total non-current liabilities (2,507) (3,004) (3,114)
----------------------- ----------------------- -----------------
Total liabilities (17,522) (27,584) (21,358)
----------------------- ----------------------- -----------------
Net assets 62,260 59,038 65,287
----------------------- ----------------------- -----------------
Equity attributable to equity
holders of the parent
-------- ----------------------- ----------------------- -----------------
Share capital 106 106 106
----------------------- ----------------------- -----------------
Share premium 6,698 6,658 6,698
----------------------- ----------------------- -----------------
Share based payments reserve 1,405 1,191 1,345
----------------------- ----------------------- -----------------
Retained earnings 54,016 50,988 57,044
----------------------- ----------------------- -----------------
Translation reserve 35 95 94
----------------------- ----------------------- -----------------
Total equity 62,260 59,038 65,287
----------------------- ----------------------- -----------------
The above condensed consolidated balance sheet should be read in
conjunction with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS'
EQUITY
FOR THE SIX MONTHSED 30 JUNE 2020, 31 DECEMBER 2019 AND 30 JUNE
2019
Share capital Share premium Translation Share based Retained Total equity
reserve payments earnings
$000 $000 $000 $000 $000 $000
-------------- -------------- ---------------- ---------------- ---------------- -------------
Balance at 1
January 2019 106 6,499 238 1,102 51,488 59,433
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
comprehensive
income for the
period
-------------- -------------- ---------------- ---------------- ---------------- -------------
IFRS 16
restatement of
opening
retained
earnings - - - - (50) (50)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Profit - - - - 2,307 2,307
-------------- -------------- ---------------- ---------------- ---------------- -------------
Other
comprehensive
expense - - (143) - - (143)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
comprehensive
income for the
period - - (143) - 2,258 2,115
-------------- -------------- ---------------- ---------------- ---------------- -------------
Transactions
with owners,
recorded
directly in
equity
-------------- -------------- ---------------- ---------------- ---------------- -------------
Share based
payments - - - 89 - 89
-------------- -------------- ---------------- ---------------- ---------------- -------------
Dividend paid - - - - (2,760) (2,760)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Exercise of
options - 159 - - - 159
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
contributions
by and
distributions
to owners - 159 - 89 (2,760) (2,511)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Unaudited
balance at 30
June 2019 106 6,658 95 1,191 50,988 59,038
-------------- -------------- ---------------- ---------------- ---------------- -------------
Unaudited
balance at 1
July 2019 106 6,658 95 1,191 50,988 59,038
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
comprehensive
income for the
period
-------------- -------------- ---------------- ---------------- ---------------- -------------
Profit - - - - 6,059 6,059
-------------- -------------- ---------------- ---------------- ---------------- -------------
Other
comprehensive
expense - - (1) - - (1)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
comprehensive
income for the
period - - (1) - 6,059 6,058
-------------- -------------- ---------------- ---------------- ---------------- -------------
Transactions
with owners,
recorded
directly in
equity
-------------- -------------- ---------------- ---------------- ---------------- -------------
Share based
payments - - - 154 - 154
-------------- -------------- ---------------- ---------------- ---------------- -------------
Dividend paid - - - - - -
-------------- -------------- ---------------- ---------------- ---------------- -------------
Exercise of
options - 40 - - - 40
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
contributions
by and
distributions
to owners - 40 - 154 - 194
-------------- -------------- ---------------- ---------------- ---------------- -------------
Balance at 31
December 2019 106 6,698 94 1,345 57,044 65,287
-------------- -------------- ---------------- ---------------- ---------------- -------------
Balance at 1
January 2020 106 6,698 94 1,345 57,044 65,287
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
comprehensive
income for the
period
-------------- -------------- ---------------- ---------------- ---------------- -------------
Loss - - - - (3,028) (3,028)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Other
comprehensive
expense - - (59) - - (59)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
comprehensive
income for the
period - - (59) - (3,028) (3,087)
-------------- -------------- ---------------- ---------------- ---------------- -------------
Transactions
with owners,
recorded
directly in
equity
-------------- -------------- ---------------- ---------------- ---------------- -------------
Share based
payments - - - 60 - 60
-------------- -------------- ---------------- ---------------- ---------------- -------------
Dividend paid - - - - - -
-------------- -------------- ---------------- ---------------- ---------------- -------------
Exercise of - - - - - -
options
-------------- -------------- ---------------- ---------------- ---------------- -------------
Total
contributions
by and
distributions
to owners - - - 60 - 60
-------------- -------------- ---------------- ---------------- ---------------- -------------
Unaudited
balance at 30
June 2020 106 6,698 35 1,405 54,016 62,260
-------------- -------------- ---------------- ---------------- ---------------- -------------
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHSED 30 JUNE 2020, 30 JUNE 2019 AND YEARED 31
DECEMBER 2019
Unaudited 30 June 2020 Unaudited 30 June 2019 31 December 2019
$000 $000 $000
---------------------------------------- ----------------------- ----------------------- -----------------
Cash flows from operating activities
----------------------- ----------------------- -----------------
(Loss) / profit for the period (3,028) 2,307 8,316
----------------------- ----------------------- -----------------
Adjustments for:
----------------------- ----------------------- -----------------
Depreciation, amortisation and impairment 2,869 1,617 2,853
----------------------- ----------------------- -----------------
Depreciation of leased assets 229 - 680
----------------------- ----------------------- -----------------
Change in fair value of investment
property - - 631
----------------------- ----------------------- -----------------
Movement in provisions (25) - 36
----------------------- ----------------------- -----------------
Taxation (income) / expense (20) 653 1,102
----------------------- ----------------------- -----------------
Lease liability interest expense 32 - 120
----------------------- ----------------------- -----------------
Financial expense 8 42 16
----------------------- ----------------------- -----------------
Equity settled share based payments 60 89 243
----------------------- ----------------------- -----------------
125 4,708 13,997
---------------------------------------- ----------------------- ----------------------- -----------------
Decrease in trade and other receivables 6,294 3,995 7,491
----------------------- ----------------------- -----------------
(Increase) in inventories (2,489) (3,414) (488)
----------------------- ----------------------- -----------------
Increase / (decrease) in trade and other
payables (4,180) 2,893 (3,636)
----------------------- ----------------------- -----------------
(250) 8,182 17,364
---------------------------------------- ----------------------- ----------------------- -----------------
Interest paid (8) (42) (16)
----------------------- ----------------------- -----------------
Lease liability interest expense (32) - (120)
----------------------- ----------------------- -----------------
Tax received / (paid) 37 (1,467) (2,282)
----------------------- ----------------------- -----------------
Net cash from operating activities (253) 6,673 14,946
----------------------- ----------------------- -----------------
Cash flows from investing activities
----------------------- ----------------------- -----------------
Acquisition of subsidiary, net of cash
acquired - - (2,392)
----------------------- ----------------------- -----------------
Acquisition of property, plant and
equipment (41) (145) (316)
----------------------- ----------------------- -----------------
Acquisition of intangible assets (1,359) (1,012) (2,598)
----------------------- ----------------------- -----------------
Net cash used in investing activities (1,400) (1,157) (5,306)
----------------------- ----------------------- -----------------
Cash flows from financing activities
----------------------- ----------------------- -----------------
Proceeds from new loan 862 - -
----------------------- ----------------------- -----------------
Repayment of borrowings (44) (492) (534)
----------------------- ----------------------- -----------------
Lease liability paid (277) (260) (674)
----------------------- ----------------------- -----------------
Dividends paid - (2,760) (2,760)
----------------------- ----------------------- -----------------
Exercise of options - 159 200
----------------------- ----------------------- -----------------
Net cash used in financing activities 541 (3,353) (3,768)
----------------------- ----------------------- -----------------
Net (decrease) / increase in cash and
cash equivalents (1,112) 2,163 5,872
----------------------- ----------------------- -----------------
Cash and cash equivalents at 1 January 16,954 11,082 11,082
----------------------- ----------------------- -----------------
Cash and cash equivalents at period end 15,842 13,245 16,954
----------------------- ----------------------- -----------------
The above condensed consolidated cash flow statement should be
read in conjunction with the accompanying notes.
1. Basis of preparation and accounting policies
As is permitted by the AIM rules, the directors have not adopted
the requirements of IAS34 'Interim Financial Reporting' in
preparing the interim financial statements. Accordingly, the
interim financial statements are not in full compliance with IFRS.
The reporting currency adopted by the Quixant Group is US dollar as
this is the trading currency of the Group. The financial
information shown for the year ended 31 December 2019 in the
interim financial information does not constitute full statutory
financial statements as defined in Section 434 of the Companies Act
2006 and has been extracted from the Company's annual report and
accounts. The Auditor's Report on the annual report and accounts
was unqualified. The condensed consolidated interim financial
information is neither audited nor reviewed and the results of
operations for the six months ended 30 June 2020 are not
necessarily indicative of the operating results for future
operating periods. The condensed consolidated interim financial
information has not been reviewed under IRSE 2410. This condensed
consolidated interim financial report was approved by the Board of
Directors on 29 September 2020.
The accounting policies applied by the Group in this condensed
consolidated interim financial report are the same as those applied
by the Group in its consolidated financial statements as at and for
the year ended 31 December 2019.
Reconciliation of profit before tax (PBT)
PBT and adjusted PBT for the current and prior periods has been
derived as follows:
PBT
Six months ended 30 June 2020 Six months ended Year
30 June ended
2019 31 December 2019
------------------------------ ----------------- ------------------
$000 $000 $000
------------------------------ ----------------- ------------------
(Loss) / profit for the period (3,028) 2,307 8,316
------------------------------ ----------------- ------------------
Adding back:
------------------------------ ----------------- ------------------
Taxation (income) / expense (20) 653 1,102
------------------------------ ----------------- ------------------
PBT (3,048) 2,961 9,418
------------------------------ ----------------- ------------------
Research & development write-off(1) 1,307 - -
------------------------------ ----------------- ------------------
Amortisation of customer relationships and
order backlog(2) 449 203 663
------------------------------ ----------------- ------------------
Share based payments(3) 60 89 243
------------------------------ ----------------- ------------------
Loss on disposal of subsidiary(4) - 124 124
------------------------------ ----------------- ------------------
Restructuring costs(4) - - 169
------------------------------ ----------------- ------------------
IDS acquisition costs(4) - - 63
------------------------------ ----------------- ------------------
Adjusted PBT (1,232) 3,377 10,680
------------------------------ ----------------- ------------------
1. To write-off capitalised research & development due to
extraordinary notifications by key suppliers to end-of-life key
components utilised in our gaming products; citing changing market
demands and supply chain issues brought about by the Coronavirus
pandemic.
2. The amortisation of customer relationships and order backlog
has been excluded as it is not a cash expense of the Group.
3. Share based payments expense has been excluded as they are not a cash expense of the Group.
4. Other items of income and expense - where other items of
income and expense occur in a particular period and their inclusion
in PBT meant that a period on period comparison of operational
results is not a consistent basis the directors will exclude them
from the adjusted numbers. During the periods under review the
directors have excluded the costs arising from the disposal of
Densitron Nordic, restructuring costs and the costs arising from
the acquisition of IDS due to their exceptional size and
incomparability with comparative periods.
2. Earnings per share
Six months ended Six months ended Year
30 June 2020 30 June 2019 ended
31 December 2019
$000 $000 $000
--------------------------------------------------- ----------------- ----------------- ------------------
Earnings
----------------- ----------------- ------------------
Earnings for the purposes of basic and diluted EPS
being net profit attributable to equity
shareholders (3,028) 2,307 8,316
----------------- ----------------- ------------------
Number of shares
----------------- ----------------- ------------------
Weighted average number of ordinary shares for the
purposes of basic EPS 66,435,060 66,379,052 66,404,468
----------------- ----------------- ------------------
Effect of dilutive potential ordinary shares:
----------------- ----------------- ------------------
Share options 460,290 385,798 499,053
----------------- ----------------- ------------------
Weighted number of ordinary shares for the purposes
of diluted EPS 66,895,350 66,764,850 66,903,521
----------------- ----------------- ------------------
Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders
by the weighted average number of shares outstanding during the period.
3. Related party transactions
During the period the Group paid EUR15,600 (2019: EUR15,600) for
administrative services to Francesca Marzilli, the wife of Nicholas
Jarmany, and NTD 294,000 (2019: NTD 326,510) for HR services to
Jenny Lin, the daughter of C-T Lin. There were no other related
party transactions, other than transactions with key management
personnel, who are the Directors of the Company.
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END
IR BCGDCBBDDGGC
(END) Dow Jones Newswires
September 30, 2020 02:00 ET (06:00 GMT)
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