Science Group PLC Trading, Business and Board Update (1228L)
January 11 2021 - 2:00AM
UK Regulatory
TIDMSAG
RNS Number : 1228L
Science Group PLC
11 January 2021
11 J anuary 2021
Science Group plc
(the "Company", "Group" or "Science Group")
Trading, Business and Board Update
Science Group provides a trading update for the 12 months to 31
December 2020.
Group revenue for the year is now anticipated to be in the order
of GBP73 m illion (2019: GBP57.2 million). While the Board took the
opportunity during the second half of the year to increase
investment in infrastructure and personnel, early indications are
that, subject to audit, the Group's adjusted operating profit for
the year ended 31 December 2020 will exceed the previously upgraded
expectations of GBP10 million (2019: GBP6.7 million).
In the first half of the year, the Group received funding for
furloughed employees under the UK Government scheme. While less
than GBP0.1 million, this was an appropriately prudent action taken
as part of a wider programme at a time of uncertainty. The Board
elected to repay such monies received from the UK Government in the
second half of 2020.
At 31 December 2020, the Group had cash (excluding client funds)
of GBP27.1 million (2019: GBP13.9 million) and net funds of GBP10.6
million (2019: net debt of GBP2.3 million). While the dividend
payment was reduced in 2020, in aggregate GBP2.4 million was
returned to shareholders through a combination of share buy-backs
and dividends compared with an aggregate of GBP2.0 million in
2019.
The Group's cash now exceeds the level prior to the Frontier
acquisition, enabling the Board to explore further strategic
opportunities, should they arise. Over the past decade, Science
Group's self-funded model has enabled the Group to grow revenue
more than 3-fold and adjusted operating profit 4-fold, without
shareholder dilution.
Due to the increasing severity of the pandemic and the
associated restrictions, the Board anticipates that the audit
process for the year ended 31 December 2020 will take longer than
usual. The preliminary results for the year are consequently
anticipated to be released in mid to late March. The Board does not
anticipate providing any further update regarding 2020 performance
until the preliminary results are released.
Board Change
After almost 7 years with the Group, Rebecca Archer, Group
Finance Director, has advised the Board of her intention to resign
to take up a new role. Rebecca has made a significant contribution
to Science Group and leaves with the Board's best wishes for the
future.
The Board is pleased to announce that Sameet ("Sam") Vohra has
accepted the position of Chief Financial Officer Designate. Sam
qualified as a Chartered Accountant with KPMG and has gained
considerable experience in senior finance leadership roles in UK
listed international businesses, including Group Financial
Controller at TT Electronics PLC and Group Director of Finance at
Spectris PLC, the FTSE 250 precision engineering company. Most
recently, he was Interim Group Finance Director at Ted Baker PLC
during their financial restructuring.
Rebecca will leave the Group after completion of the 2020 audit
and the posting of the Annual Report to shareholders. It is
anticipated that Sam will be appointed to the Board in January with
the formal transfer being completed in April. Over the next few
months, a handover of responsibilities will be effected.
Frontier Smart Technologies ("Frontier")
Since the acquisition in 2019, the restructuring and turnaround
of Frontier has been very successful, resulting in an excellent
performance in 2020. Frontier is now a strongly profitable
technology business with a market leading position. Confirmed
orders at the start of 2021 are very healthy and shipments in the
first part of the year may be supply constrained.
Frontier has a different product-based business model to the
services provided by the Group's other Divisions. As previously
indicated, the long-term strategy for Frontier has always been a
subject for further review once the turnaround was satisfactorily
completed. At the current time, the Board considers the key options
to be: (i) to retain the business within the Group and maximise the
profit and cash flow contribution; (ii) to increase operating scale
through the merger or acquisition of a similar business or
businesses; or (iii) to sell all or part of the business. The Board
and the Frontier management team continue to consider all these
alternatives and have now decided to initiate a more formal
process, including appointing external advisers, to determine the
best approach. This process may take some time and the Board
remains open minded as to the outcome. Further announcements will
be made at the relevant time.
Science Group plc
Tel: +44 (0) 1223 875
Martyn Ratcliffe, Chairman 200
www.sciencegroup.com
Stifel Nicolaus Europe Limited (Nominated
Adviser and Joint Broker)
Tel: +44 (0) 20 7710
Nick Adams, Alex Price 7600
Liberum Capital Limited (Joint Broker)
Tel: +44 (0) 20 3100
Neil Patel, Cameron Duncan 2000
Note: This announcement contains inside information which is
disclosed in accordance with the Market Abuse Regulation (No
596/2014). The person responsible for this announcement is Martyn
Ratcliffe .
Regulatory disclosures
Pursuant to Schedule 2(g) of the AIM Rules for Companies, Sameet
Vohra (aged 47) has held the following directorships or
partnerships in the past five years:
Current directorships and partnerships :
The Grange Wraylands Drive Reigate Ltd
Directorships/partnerships held in the past five years:
None
Sameet Vohra does not currently hold any shares in the
Company.
There is no further information to be disclosed in respect of
the above appointment pursuant to Rule 17 and Schedule 2 paragraph
(g) of the AIM Rules for Companies
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