TIDMRAI
RNS Number : 9071K
RA International Group PLC
07 September 2021
This announcement contains inside information
RA INTERNATIONAL GROUP PLC
("RA International" or the "Company")
Interim Results for the six months to 30 June 2021
RA International Group plc (AIM: RAI), a specialist provider of
complex and integrated remote site services to Humanitarian,
Governmental and Commercial organisations globally, is pleased to
announce its interim results in respect of the six months ended 30
June 2021.
HIGHLIGHTS
-- Revenue of USD 26.2m (H2 20: USD 29.1m, H1 20: USD 35.4m) and underlying
EBITDA of USD 5.0m (H2 20: USD 6.2m, H1 20: USD 8.1m), in line with expectations
for the first half of 2021.
-- IFM revenue of USD 15.4m (H2 20: USD 15.3m, H1 20: USD 15.9m) highlights
the continued resilience of this service channel as supply chain and construction
activity remained impacted by COVID-19 in the first half of the year.
-- Given the ongoing uncertainty in Cabo Delgado province, Mozambique, we
have excluded the USD 60.5m contract to provide IFM services in this region
and reset the order book to USD 129m as at 30 June 2021.
-- The revised order book of USD 129m as at 30 June 2021 reflects new contracts,
contract uplifts and extensions of USD 29m in the period, highlighting
very encouraging new contract momentum; we expect awards with a higher
aggregate value in the second half of the year.
-- Significant contract awards within the first half of the year include a
USD 21.5m contract with USAID and two UN construction contracts in Central
Africa, with a combined value of USD 5.8m.
-- Subsequent to the end of the Period we commenced a construction contract
with Cherokee Nation Mechanical, LLC for works in East Africa with a value
of USD 4.2m. We have also made significant progress in finalizing the two
contracts announced in March to provide construction related support services
for the U.S. Department of State in the Middle East and in East Asia. Both
contracts are expected to be significant in value.
-- In addition to the above, during the period we agreed commercial terms
with Danakali Limited for the construction of a 1,200 person camp facility
and to provide IFM services.
-- Cash as at 30 June 2021 of USD 10.1m, reflecting a USD 7.5m decrease from
December 2020 year-end, primarily attributable to working capital movements
which are expected to begin to reverse in the second half of the year.
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'm USD'm USD'm
Revenue 26.2 29.1 35.4
Gross profit 7.7 8.5 10.3
Gross profit margin 29.2% 29.2% 29.1%
Underlying EBITDA(1) 5.0 6.2 8.1
Underlying EBITDA margin 19.2% 21.2% 22.8%
Profit before tax 0.8 1.6 5.1
Profit before tax margin 3.2% 5.4% 14.3%
Basic EPS (cents) 0.6 0.9 2.9
Net cash (end of period) (2) 3.6 11.2 20.3
Soraya Narfeldt, CEO of RA International, commented:
"Our financial performance for the first half of the year, with
revenue and profitability in line with market expectations, is a
resilient performance given COVID-19 uncertainty has remained
across our markets. We are cautiously optimistic and starting to
see encouraging signs that the business environment is improving;
depending on timing, this could boost our second half performance,
but in any event should bridge to a stronger 2022.
What is less apparent in the numbers we are reporting today is
the progress we are making in building a stronger business year on
year. This becomes clear when you consider the significant projects
we are winning including Danakali, Cherokee Nation, and USAID. We
also have visibility on future contract wins which we see as highly
likely we will secure. By the end of this financial year, based on
current contract pipeline, we could more than offset the reduction
in our order book which we have made in light of the ongoing
situation in Mozambique. To not only replace a contract of this
scale but to deliver growth would be a real barometer of the
success of our strategy, our business development activity across
all our customer segments and our reputation as a trusted partner
for global, blue-chip organisations. We look forward to updating
investors on our progress throughout the second half of the
year."
Notes to summary table of financial results:
(1) Underlying EBITDA is calculated by adding depreciation, non-underlying
items, and share based payment expense to operating profit
(2) Net cash represents cash less overdraft balances, term loans
and notes outstanding.
Enquiries:
RA International Group PLC Via Bamburgh Capital
Soraya Narfeldt, Chief Executive Officer
Lars Narfeldt, Chief Operating Officer
Andrew Bolter, Chief Financial Officer
Canaccord Genuity Limited (Nominated Adviser
and Broker)
Bobbie Hilliam
Alex Aylen +44 (0) 207 523
Georgina McCooke 8000
Bamburgh Capital Limited (Financial PR & Investor +44 (0) 191 249
Relations) 7442
Murdo Montgomery investors@raints.com
Background to the Company
RA International is a leading provider of services to remote
locations. The Company offers its services through three channels:
construction, integrated facilities management and supply chain,
and services three main client groups: humanitarian and aid
agencies, governments and commercial customers, predominantly in
the oil and gas and mining sectors. It has a strong customer base,
largely comprising UN agencies, western governments and global
corporations.
The Company provides comprehensive, flexible, mission critical
support to its clients enabling them to focus on the delivery of
their respective businesses and services. Focusing on integrity and
values alongside making on-going investment in its people,
locations and operations has over time created a reliable and
trusted brand within its sector.
CHIEF EXECUTIVE'S REVIEW
Overview
I am pleased to update the Company's shareholders on our
performance for the six months ended 30 June 2021 (the "Period" or
"First Half"). The main themes for the First Half have been
consistent with the views and outlook we detailed in our full year
results update at the end of March. In March, we highlighted our
confidence in the level and nature of our business development
activity, which is aligned with our customer led growth strategy.
The contracts we have secured in the First Half, including the
landmark contracts with Cherokee Nation Mechanical, LLC
("Cherokee") and the United States Agency for International
Development ("USAID") highlight an increase in business momentum.
We are growing our customer base and winning larger, more valuable
long-term contracts, expanding into new geographies and
demonstrating the value of our relationship-based approach and "one
supplier" model.
We are greatly encouraged by this momentum, which will drive
long-term business growth, however we remain cautious in the
near-term as COVID-19 continues to be a constraint on new business
activity and as a result of the unfolding situation in Mozambique.
Despite these challenges, we have delivered a stable performance
for the First Half, and, as we look ahead, are cautiously
optimistic the impact of COVID-19 is receding, and new business
activity is picking up.
We delivered a resilient performance in the First Half, in-line
with expectations
We highlighted in March the continued impact of the pandemic as
a health crisis and that of government enforced restrictions and
lock-down provisions which remained in place across the world.
Whilst we were encouraged by the level of bid activity we were
seeing and our ability to continue to win high quality contracts,
delays in both awarding and commencing new contracts remained a
material factor. This uncertainty informed our approach of adopting
a cautious view on our financial performance in the near-term,
including for the first half of 2021. The financial performance we
are reporting today, with revenue of USD 26.2m and underlying
EBITDA of USD 5.0m, is in line with expectations and we see these
results as a credible performance as we continue to work in an
operating environment where COVID-19 remains a significant factor.
As we think about the near-term outlook, we are encouraged both by
the continued resilience of our IFM service channel and by the
awards of new construction contracts; an important indicator that
activity levels are starting to return to more normal levels. We
expect to see heightened levels of project starts by existing and
new customers and, depending on timing, this could lead to a
materially stronger performance in the second half of the year but,
in any event, should bridge to a stronger performance in 2022.
We are responding to the evolving situation in Mozambique
Clearly the situation in Mozambique has been a key area of focus
for us since the tragic events unfolded in Cabo Delgado province in
March 2021. It is not appropriate to provide commentary on this
from a people perspective in this report, but it is important we
provide shareholders with an update from a commercial perspective.
Given the continued uncertainty in the region, which has seen Total
suspend activity in the area, we have excluded the USD 60.5m
contract from our order book and have reset the order book at USD
129m as at 30 June 2021. We highlighted in March that we expected
the situation in Mozambique to have a USD 10.0m impact on revenue
in 2021; this remains our expectation. Looking further ahead, in
spite of the ongoing instability in the region, we remain confident
that by virtue of the considerable multinational commercial
investment and the significance to both Mozambique and the
international community, the project will come into fruition and we
remain well positioned to provide the originally planned services
as and when they are required.
We continue to drive long-term value by executing on our
customer-led growth strategy
As we have grown over the years, we have relentlessly and
successfully focused on the diversification of our business in
terms of geography, customer concentration, and service channel.
Our customers rely on us and trust us to deliver in the most
challenging of circumstances and our track record of delivering
large and complex projects, often through our "one-supplier" model,
and supporting our customers and their changing requirements is
central to our ethos of growing with our customers. We believe our
relationship driven approach continues to set us apart and will
drive sustainable growth through further expansion into our very
significant addressable markets.
During the Period we announced contracts which highlight the
strategy in action. In March 2021, we announced our appointment as
teaming partner on two contracts with Cherokee, providing
construction related services for the U.S. Department of State in
the Middle East and East Asia. These significant contracts build on
our initial work with Cherokee in East Africa and highlight how by
partnering with large US corporations of Cherokee's standing, we
can deliver large and complex projects for the US government and
extend our footprint to new geographies. We look forward to further
collaboration with Cherokee on new projects and growing this very
successful partnership.
We highlighted in our March results the high level of business
development activity we are involved in, with new bid activity on
contracts ranging from USD 10m to USD 50m being particularly
notable. We also highlighted our discussions with large US
corporations and governmental institutions as a primary area of
focus for our business development activity. The Cherokee contracts
referenced above demonstrate the effectiveness of this approach as
does our contract with USAID, which we announced in June 2021. This
contract sees us working directly with USAID to provide
comprehensive life support and maintenance services in one of their
compounds in East Africa. The contract is for an initial two-year
base period, with the option for two one-year extensions, with a
contract value in aggregate of USD 21.5m. Our reputation for
delivering integrated services to international standards was
instrumental in securing this contract.
We continue to make good progress on our business development
activity with respect to the commercial sector, another primary
area of focus for us. We announced in June 2021 that we had agreed
commercial terms with Danakali. This will be a major milestone
contract for RA in that it is a globally significant project and
highlights the value of our integrated approach, constructing and
providing ongoing IFM support for a 1,200 person camp for the
Colluli Mining Share Company ("CMSC") development in Eritrea, East
Africa. We were appointed as preferred contractor in 2020 and have
worked closely with Danakali and its partners as they have
developed their plans, with the updated scope of work and contract
terms highlighting the value of this relationship driven approach.
We look forward to providing shareholders with further information
on the key commercial terms when all approvals have been obtained,
which include the CMSC board.
Overall, we have demonstrated our ability to win large contracts
across our humanitarian, governmental and commercial customer base
and the work we have been doing to build relationships with
customers across these categories supports a healthy pipeline with
a number of similar sized opportunities which are in various stages
of adjudication.
Contracts
We were awarded new contracts, uplifts, and extensions to
existing contracts of USD 29m in the First Half and expect awards
with a higher aggregate value in the second half of 2021.
Contract order book:
USD'm
Opening order book 187
New contracts, contract uplifts
and extensions 29
Removal of Mozambique contract (61)
Contracted revenue delivered (26)
----------------
Closing order book as at 30 June
2021 129
At 30 June 2021, 57% of the order book composition was comprised
of high value IFM work. The scale of our order book, combined with
the contracts at advanced stage negotiation and proven resilience
of IFM revenue, provides confidence to continue to make long-term
investment decisions, even in these dynamic times.
Current Trading and Outlook
Our financial performance for the first half of the year, with
revenue and profitability in line with market expectations, is a
resilient performance given COVID-19 uncertainty has remained
across our markets. We are cautiously optimistic and starting to
see encouraging signs that the business environment is improving -
depending on timing, this could boost our second half performance,
but in any event should bridge to a stronger 2022.
What is less apparent in the numbers we are reporting today is
the progress we are making in building a stronger business year on
year. This becomes clear when you consider the significant projects
we are winning - including Danakali, Cherokee Nation, and USAID. We
also have visibility on future contract wins which we see as highly
likely we'll secure. By the end of this financial year, based on
current contract pipeline, we could more than offset the reduction
in our order book which we have made in light of the ongoing
situation in Mozambique. To not only replace a contract of this
scale but to deliver growth would be a real barometer of the
success of our strategy, our business development activity across
all our customer segments and our reputation as a trusted partner
for global, blue-chip organisations. We look forward to updating
investors on our progress throughout the second half of the
year.
Soraya Narfeldt
Chief Executive Officer
07 September 2021
FINANCIAL REVIEW
Overview
Revenue of USD 26.2m and underlying EBITDA of USD 5.0m highlight
our financial performance for the Period, in line with external
expectations. We see this as a resilient performance, with the
stability of our IFM service channel remaining a key feature of our
business. While Construction and Supply Chain revenue continues to
be impacted by COVID-19, we are seeing encouraging signs that the
business environment is improving. The most promising is that we
have commenced works on all newly awarded construction contracts.
Gross margin for the Period was stable at 29.2% (H2 20 29.2%, H1 20
29.1%) with improvements expected once the operating environment
normalises. Cash generation for the Period was lower than
comparative periods reflecting an adverse USD 8.3m movement in
working capital. This primarily resulted from an increase in
inventory balances caused by the suspension of works in Mozambique
in March. These movements are seen as temporary and are expected to
begin to reverse in the next six months as inventory is reallocated
to new and ongoing projects.
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'm USD'm USD'm
Revenue 26.2 29.1 35.4
Gross profit 7.7 8.5 10.3
Gross profit margin 29.2% 29.2% 29.1%
Underlying EBITDA 5.0 6.2 8.1
Underlying EBITDA margin 19.2% 21.2% 22.8%
Profit before tax 0.8 1.6 5.1
Profit before tax margin 3.2% 5.4% 14.3%
Basic EPS (cents) 0.6 0.9 2.9
Net cash (end of period) 3.6 11.2 20.3
Revenue
Reported revenue for H1 21 was USD 26.2m (H2 20: USD 29.1m, H1
20: USD 35.4m). The decrease from prior period comparators reflects
lower revenues from our Construction and Supply Chain channels
whilst IFM revenue remained stable. We are encouraged by a recent
uptick in construction contracts being awarded, which although
relatively small in terms of contract value, are an important
indicator of returning to a more normal operating environment,
which if it persists, should lead to significant growth in
Construction revenue in the short term.
The weighting of revenue by customer type remained stable. At
52%, Commercial and Government work represents approximately half
of our revenue (H2 20: 53%, H1 20: 51%). Our strategic goal is to
diversify our customer base and revenue streams over time.
Revenue by service channel:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'm USD'm USD'm
Integrated facilities management 15.4 15.3 15.9
Construction 6.2 8.4 10.7
Supply chain 4.6 5.3 8.8
---------------- ---------------- ----------------
26.2 29.1 35.4
Profit Margin
Gross margin in H1 21 was 29.2% (H2 20: 29.2%, H1 20: 29.1%),
reflecting stable profit margins compared with prior period
comparators. The stability in gross margins reflects an increase in
the percentage of IFM revenue, offset by the addition of certain
new contracts which have lower margin in the initial phase of
deployment but are expected to increase over time, and also lower
occupancy in our hotel facility in Somalia. Gross margin is not
expected to return to pre-COVID levels until such time as more
normal levels of customer activity resume and operational
inefficiencies caused by COVID-19 ease.
Reconciliation of profit to Underlying EBITDA:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'm USD'm USD'm
Profit 1.0 1.5 5.0
Tax expense (0.2) - -
---------------- ---------------- ----------------
Profit before tax 0.8 1.6 5.1
Finance costs 0.6 0.5 0.5
Investment income - (0.1) (0.1)
---------------- ---------------- ----------------
Operating profit 1.4 1.9 5.4
Non-underlying items 1.2 2.2 0.8
---------------- ---------------- ----------------
Underlying operating profit 2.6 4.2 6.2
Share based payments 0.3 0.1 -
Depreciation 2.1 1.9 1.8
---------------- ---------------- ----------------
Underlying EBITDA 5.0 6.2 8.1
Underlying EBITDA margin in H1 21 was 19.2% (H2 20: 21.2%, H1
20: 22.8%) reflecting the variance in revenue and an increase in
administrative expenses. Administrative expenses increased modestly
in the Period to USD 5.0m from USD 4.3m in the prior period,
resulting from investment in our project management and support
functions to underpin anticipated future growth of the business.
Excluding this investment, underling EBITDA margin would have been
comparable to the prior period.
During the Period, the Company incurred non-underlying costs of
USD 1.2m (H2 20: USD 2.2m, H1 20: USD 0.8m). This balance includes
an impairment charge of USD 0.8m relating to assets that were
damaged as a result of the hostile activity in Mozambique. We are
actively working with our insurance providers to identify the value
of a possible recovery and taking all practical steps to safeguard
assets still in the Palma area, including relocating assets from
the region.
Non-underlying items
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'm USD'm USD'm
Acquisition costs - 0.2 -
COVID-19 costs 0.4 0.6 0.8
Restructuring costs - 0.3 -
Other share based payments - 1.2 -
Asset impairment 0.8 - -
---------------- ---------------- ----------------
1.2 2.2 0.8
Earnings Per Share
Basic earnings per share was 0.6 cents in the current period (H2
20: 0.9 cents, H1 20: 2.9 cents) and is equal to diluted earnings
per share.
Cashflow
Net cash outflows from operating activities of USD 3.6m in the
Period reflects a marked decrease from the comparators with net
inflows of USD 12.0m and USD 9.1m respectively. The decrease is
primarily attributable to temporary working capital movements which
impacted cash negatively by USD 8.3m. This compares with a USD 7.1m
working capital cash benefit in H2 20. The negative working capital
movements for the Period primarily relate to the addition of USD
4.0m of inventory which was in transit to Mozambique at the time of
the attack and increased accounts receivable and decreased accounts
payable balances. The inventory relating to Mozambique is being
reallocated to new and existing projects which is expected to
result in working capital beginning to reverse in the next six
months.
Capital expenditure ("capex") for the period of USD 3.3m
primarily relates to investment in Mozambique. As previously
highlighted, overall capex for the current financial year is
expected to be markedly lower than prior years (2020: USD 24.5m,
2019: USD 12.4m), with 2020 in particular reflecting significant
investment in our Mozambique project. Given our current portfolio
of projects we anticipate 2021 capex to be approximately USD
5-7m.
Balance Sheet and Liquidity
Cash as at 30 June 2021 of USD 10.1m reflects a USD 7.5m
decrease from year-end. The decrease in cash is attributable to the
working capital movements outlined above, which are expected to
begin to reverse in the next six months.
Net assets at 30 June 2021 were USD 70.2m (H2 20: USD 72.1m, H1
20: USD 71.8m), with fixed assets comprising the majority of the
total balance sheet following significant capital expenditure in
2020.
Breakup of net assets:
As at As at As at
30 June 31 December 30 June
2021 2020 2020
USD'm USD'm USD'm
Cash and cash equivalents 10.1 17.6 20.3
Loan notes (6.5) (6.5) -
---------------- ---------------- ----------------
Net cash 3.6 11.2 20.3
Net working capital 18.8 14.4 18.5
Non-current assets 54.5 51.0 36.3
Tangible owned assets 48.6 47.4 33.7
Right-to-use assets 5.8 3.5 2.4
Goodwill 0.1 0.1 0.1
Lease liabilities and end of service
benefit (6.8) (4.6) (3.2)
---------------- ---------------- ----------------
Net assets 70.2 72.1 71.8
Within non-current assets is USD 16.7m of buildings,
infrastructure, and equipment in Palma, Mozambique. We are
currently working to relocate high value items to ensure their
continued security and upkeep. A full review of the value of these
assets is planned for the second half of 2021.
Dividend
A dividend of 1.35p per share totalling USD 3.2m was declared
and authorised during H1 21 (H2 20: nil, H1 20: USD 2.7m) and was
subsequently paid on 8 July 2021.
The Board's intention continues to be to adopt a progressive
dividend policy and to increase the dividend in future years while
retaining sufficient working capital to meet the needs of the
business and to fund continued growth. The Board believes the
continued growth in our customer base and the pursuit of a
one-supplier model will provide a basis for continued earnings
growth in the future
Shares in Issue and Treasury Shares
In the First Half, 157,493 ordinary shares were transferred out
of treasury in settlement of certain employee share options. As at
30 June 2021, the total number of ordinary shares in issue and
admitted to trading on AIM was 173,575,741, comprising 1,870,058
ordinary shares held in treasury and 171,705,683 ordinary shares
with voting rights.
Andrew Bolter
Chief Financial Officer
07 September 2021
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 June 2021
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
Notes USD'000 USD'000 USD'000
Revenue 26,240 29,076 35,365
Direct costs (18,580) (20,577) (25,070)
---------------- ---------------- ----------------
Gross profit 7,660 8,499 10,295
Administrative expenses (5,042) (4,338) (4,091)
---------------- ---------------- ----------------
Underlying operating profit 2,618 4,161 6,204
Non-underlying items 4 (1,243) (2,249) (797)
---------------- ---------------- ----------------
Operating profit 1,375 1,912 5,407
Investment revenue 22 139 139
Finance costs (560) (491) (479)
---------------- ---------------- ----------------
Profit before tax 837 1,560 5,067
Tax expense 164 (20) (41)
---------------- ---------------- ----------------
Profit and total comprehensive
income for the period 1,001 1,540 5,026
Basic and diluted earnings per
share (cents) 5 0.6 0.9 2.9
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2021
30 June 31 December 30 June
2021 2020 2020
Notes USD'000 USD'000 USD'000
Assets
Non-current assets
Property, plant, and equipment 54,365 50,886 36,114
Goodwill 138 138 138
---------------- ---------------- ----------------
54,503 51,024 36,252
---------------- ---------------- ----------------
Current assets
Inventories 13,267 9,142 8,971
Trade and other receivables 14,201 12,666 19,078
Cash and cash equivalents 10,102 17,632 20,266
---------------- ---------------- ----------------
37,570 39,440 48,315
---------------- ---------------- ----------------
Total assets 92,073 90,464 84,567
Equity and liabilities
Equity
Share capital 24,300 24,300 24,300
Share premium 18,254 18,254 18,254
Merger reserve (17,803) (17,803) (17,803)
Treasury shares (1,257) (1,363) (51)
Share based payment reserve 383 177 62
Retained earnings 46,304 48,509 47,037
---------------- ---------------- ----------------
Total equity 70,181 72,074 71,799
---------------- ---------------- ----------------
Non-current liabilities
Loan notes 6,471 6,471 -
Lease liabilities 5,698 3,720 2,579
Employees' end of service benefits 562 517 477
---------------- ---------------- ----------------
12,731 10,708 3,056
---------------- ---------------- ----------------
Current liabilities
Lease liabilities 502 318 163
Trade and other payables 8,659 7,364 9,549
---------------- ---------------- ----------------
9,161 7,682 9,712
---------------- ---------------- ----------------
Total liabilities 21,892 18,390 12,768
---------------- ---------------- ----------------
Total equity and liabilities 92,073 90,464 84,567
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2021
Share Based
Share Share Merger Treasury Payment Retained
Capital Premium Reserve Shares Reserve Earnings Total
Notes USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
As at 1
January 2020 24,300 18,254 (17,803) - 47 44,685 69,483
Total
comprehensive
income for
the period - - - - - 5,026 5,026
Share based
payments - - - - 15 - 15
Dividends
declared and
authorised 6 - - - - - (2,674) (2,674)
Purchase of
treasury
shares - - - (51) - - (51)
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
As at 30 June
2020 24,300 18,254 (17,803) (51) 62 47,037 71,799
Total
comprehensive
income for
the period - - - - - 1,540 1,540
Share based
payments - - - - 115 - 115
Purchase of
treasury
shares - - - (2,549) - - (2,549)
Issuance of
treasury
shares - - - 1,237 - (68) 1,169
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
As at 31
December 2020 24,300 18,254 (17,803) (1,363) 177 48,509 72,074
Total
comprehensive
income for
the period - - - - - 1,001 1,001
Share based
payments - - - - 288 - 288
Dividends
declared and
authorised 6 - - - - - (3,206) (3,206)
Issuance of
treasury
shares - - - 106 (82) - 24
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
As at 30 June
2021 24,300 18,254 (17,803) (1,257) 383 46,304 70,181
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 30 June 2021
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
Notes USD'000 USD'000 USD'000
Operating activities
Operating profit 1,375 1,912 5,407
Adjustments for non-cash and other items:
Depreciation on property, plant, and equipment 2,127 1,885 1,846
Loss on disposal of property, plant, and equipment 51 83 10
Unrealised differences on translation of foreign
balances 15 (330) 335
Provision for employees' end of service benefits 208 110 99
Share based payments 288 1,284 15
Non-underlying items - asset impairment 4 817 - -
---------------- ---------------- ----------------
4,881 4,944 7,712
Working capital adjustments:
Inventories (4,643) (171) (2,793)
Accounts receivable, deposits, and other
receivables (1,921) 6,798 5,442
Accounts payable and accruals (1,731) 508 (1,124)
---------------- ---------------- ----------------
Cash flows generated from operations (3,414) 12,079 9,237
Tax paid (16) (38) (79)
Employees' end of service benefits paid (163) (70) (13)
---------------- ---------------- ----------------
Net cash flows from operating activities (3,593) 11,971 9,145
---------------- ---------------- ----------------
Investing activities
Investment revenue received 22 139 139
Purchase of property, plant, and equipment (3,287) (15,270) (9,180)
Proceeds from disposal of property, plant, and
equipment 35 20 4
---------------- ---------------- ----------------
Net cash flows used in investing activities (3,230) (15,111) (9,037)
---------------- ---------------- ----------------
Financing activities
Proceeds from borrowings 387 6,084 -
Payment of lease liabilities (543) (194) (370)
Finance costs paid (560) (491) (479)
Dividends paid 6 - (2,674) -
Purchase of treasury shares - (2,549) (51)
Proceeds from share options exercised 24 - -
---------------- ---------------- ----------------
Net cash flows used in financing activities (692) 176 (900)
---------------- ---------------- ----------------
Net decrease in cash and cash equivalents (7,515) (2,964) (792)
Cash and cash equivalents as at start of the period 17,632 20,266 21,393
Effect of foreign exchange on cash and cash
equivalents (15) 330 (335)
---------------- ---------------- ----------------
Cash and cash equivalents as at end of the period 10,102 17,632 20,266
The attached notes 1 to 7 form part of the Condensed
Consolidated Interim Financial Statements.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
For the six months ended 30 June 2021
1 CORPORATE INFORMATION
The principal activity of RA International Group plc ("RAI" or
the "Company") and its subsidiaries (together the "Group") is
providing services in demanding and remote areas. These services
include construction, integrated facilities management, and supply
chain services. RAI was incorporated on 13 March 2018 as a public
company in England and Wales under registration number 11252957.
The address of its registered office is One Fleet Place, London,
EC4M 7WS.
2 BASIS OF PREPARATION
The financial information set out in these condensed
consolidated interim financial statements does not constitute the
Group's statutory accounts within the meaning of section 434 of the
Companies Act 2006.
The unaudited condensed consolidated interim financial
statements for the six months ended 30 June 2021 have been prepared
in accordance with IAS 34, 'Interim Financial Reporting'. They do
not include all the information required for full annual financial
statements and should be read in conjunction with the consolidated
financial statements of RAI for the year ended 31 December 2020.
The unaudited financial information has been prepared using the
same accounting policies and methods of computation as the Annual
Report for the year ended 31 December 2020. The same accounting
policies and methods of computation will be used to prepare the
Annual Report for the year ended 31 December 2021. The financial
statements of the Group are prepared in accordance with IFRS.
3 SEGMENT INFORMATION
For management purposes, the Group is organised into one segment
based on its products and services, which is the provision of
services in demanding and remote areas. Accordingly, the Group only
has one reportable segment. The Group's Chief Operating Decision
Maker ("CODM") monitors the operating results of the business as a
single unit for the purpose of making decisions about resource
allocation and assessing performance. The CODM is considered to be
the Board of Directors.
Operating segments
Revenue, operating results, assets and liabilities presented in
the financial statements relate to the provision of services in
demanding and remote areas.
Revenue by service channel:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'000 USD'000 USD'000
Integrated facilities management 15,415 15,349 15,916
Construction 6,187 8,420 10,665
Supply chain 4,638 5,307 8,784
---------------- ---------------- ----------------
26,240 29,076 35,365
Revenue by recognition timing:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'000 USD'000 USD'000
Revenue recognised over time 19,318 19,940 20,178
Revenue recognised at a point
in time 6,922 9,136 15,187
---------------- ---------------- ----------------
26,240 29,076 35,365
Geographic segment
The Group primarily operates in Africa and the CODM considers
Africa and Other to be the only geographic segments of the Group.
The below geography split is based on the location of project
implementation.
Revenue by geographic area of project implementation:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'000 USD'000 USD'000
Africa 25,427 28,741 32,420
Other 813 335 2,945
---------------- ---------------- ----------------
26,240 29,076 35,365
Non-current assets by geographic area:
As at As at As at
30 June 31 December 30 June
2021 2020 2020
USD'000 USD'000 USD'000
Africa 51,249 47,687 35,003
Other 3,254 3,337 1,249
---------------- ---------------- ----------------
54,503 51,024 36,252
Revenue split by customer:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
% % %
Customer A 29 24 24
Customer E 18 16 6
Customer F 12 14 7
Customer D 10 12 7
Customer G 10 9 9
Customer I 3 3 2
Customer H 2 5 5
Customer B 1 5 9
Customer C - 1 6
Other 15 11 25
---------------- ---------------- ----------------
100 100 100
4 NON-UNDERLYING ITEMS
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
USD'000 USD'000 USD'000
Acquisition costs - 175 -
COVID-19 costs 426 636 797
Restructuring costs - 269 -
Other share based payments - 1,169 -
Asset impairment 817 - -
---------------- ---------------- ----------------
1,243 2,249 797
Asset impairment
These costs relate to the write off of inventory and fixed
assets stolen or damaged beyond repair following the widescale
attack in Palma District, Mozambique in March 2021.
5 EARNINGS PER SHARE
The Group presents basic earnings per share ("EPS") data for its
ordinary shares. Basic EPS is calculated by dividing the profit
attributable to ordinary shareholders of the Group by the weighted
average number of ordinary shares outstanding during the period.
Diluted earnings per share is calculated by dividing the profit
attributable to ordinary shareholders of the Group by the weighted
average number of ordinary shares outstanding during the period
plus the weighted average number of ordinary shares that would be
issued on conversion of all the dilutive potential ordinary shares
into ordinary shares.
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2021 2020 2020
Profit for the period (USD'000) 1,001 1,540 5,026
Basic weighted average number
of ordinary shares 171,576,465 171,347,432 173,566,950
Effect of employee share options 1,560,394 1,407,232 -
---------------- ---------------- ----------------
Diluted weighted average number
of shares 173,136,859 172,754,664 173,566,950
Basic earnings per share (cents) 0.6 0.9 2.9
Diluted earnings per share (cents) 0.6 0.9 2.9
6 DIVIDENDS
During the interim period, a dividend of 1.35 pence (USD 0.02)
per share (171,662,973 shares) totalling GBP 2,317,000 (USD
3,206,000) was declared and authorised (H2 20: nil, H1 20: 1.25
pence (USD 0.02) per share (173,575,741 shares) totalling GBP
2,170,000 (USD 2,674,000)). The dividend declared and authorised
during the interim period was paid to ordinary shareholders on 8
July 2021.
7 APPROVAL OF CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
The condensed consolidated interim financial statements were
approved by the Board of Directors on 6 September 2021.
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END
IR UPUGCBUPGGBQ
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