TIDMSND
RNS Number : 9347P
Sondrel (Holdings) plc
15 February 2023
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the UK Market Abuse Regulation
15 February 2023
Sondrel (Holdings) plc
("Sondrel", the "Company" and together with its subsidiaries the
"Group")
FY 2022 Trading and Business Update
Strong revenue growth and design wins in line with
expectations
Investment committed into material new contract
New design win with tape out to occur in very near future
Sondrel (AIM:SND), the fabless semiconductor business providing
turnkey services in the design and delivery of 'application
specific integrated circuits' ("ASICs") and 'system on chips'
("SoCs") for leading global technology brands, is pleased to
provide an update on trading for the financial year ended 31
December 2022 ("FY22"), and key milestones achieved since the
Group's IPO in October 2022.
Key Highlights
- Revenue growth of 116% YoY with FY22 revenue of GBP17.5 million (FY21: GBP8.1 million).
- Record new orders received, with growth of over 130% YoY and
providing strong visibility over FY23 revenue.
- Maiden post IPO design tape out for a leading provider of Edge
AI Hardware Accelerator solutions in January 2023.
- Significant progress made both during 2022 and the start of
2023 in respect of a material turnkey ASIC engagement secured in Q2
2022 for a Tier 1 OEM Automotive customer production for which
could be significant over the life of the product.
- New design wins in line with Board expectations, delivering a
strong increase in the pipeline for volume supply.
- Strong design pipeline identified for 2023.
The Company has delivered revenue growth of 116% YoY - with ASIC
projects now accounting for an increased 73% of Group revenues
(Consultancy: 27%). The net proceeds from the Company's IPO are
already being deployed to accelerate the Group's future growth,
including increasing the number of engineers, investing further in
developing the Group's Architecting the Future IP solutions, and
accelerating growth in the USA and other geographies.
During FY22, the Group secured design wins in the automotive,
Edge-AI, mobile, networking, and aerospace markets. These wins are
strong endorsements of Sondrel's capabilities and have helped to
strengthen the Group's design pipeline for 2023 and the opportunity
to scale volume deliveries beyond that.
During FY22, the Group achieved record new design orders
received with an aggregate value of GBP25.6 million, a 130% year on
year increase, and providing strong FY23 visibility.
Given Sondrel's reputation and differentiated design capability,
the Group is often approached by other ASIC designers and
manufacturers about how they could work together to benefit from
Sondrel's expertise and global footprint. In this regard, the Group
was recently approached by a new customer wishing to benefit from
Sondrel's expertise in completing the design phase of one of its
existing ASICs with Sondrel subsequently responsible for taping out
the design, new product introduction/prototyping phases and
production services. Having been engaged on this new project, the
Group has already completed the design phase, with an estimated
value of GBP1.8 million in 2023 and expects tape out to occur in
the very near future. The Group will make a further announcement in
this regard in due course.
In the automotive sector, significant progress has been made in
respect of the material turnkey ASIC engagement for a Tier 1 OEM
Automotive customer - with a project milestone achieved in Q4 2022,
albeit later in the quarter than had previously been expected. A
second project milestone, previously anticipated to occur in late
FY22, is now expected to occur in Q1 2023. Notwithstanding this,
investment into the third party components of the project continued
in line with expectations during FY22. Whilst FY23 achievement of
the second project milestone payment and, inter alia, foreign
exchange movements and amortisation treatment will have an effect
on FY22 levels of profitability, the Company had unaudited cash
balances of GBP4.5 million as at 31 December 2022 prior to receipt
of the stage payment in respect of the Q4 2022 automotive project
milestone in January 2023. As stated at the time of the Group's
IPO, Sondrel expects typical production volumes for each contract
to deliver revenue of GBP10m to GBP100m per annum and the contract
with the Tier 1 Automotive customer could deliver production
revenue at the upper end of this range.
The Group has continued to deliver all other projects in line
with its expectations, as demonstrated by the January 2023 design
tape out for a leading provider of Edge AI Hardware
Accelerator.
The Company notes some of the challenges for the semiconductor
industry forecast for 2023 but given that Sondrel services fast
growth end markets with structural growth drivers, the Group has
seen no downturn in the industries or markets that it services.
Furthermore, the Company continues to benefit from the moves to
localising supply chains and international technology trade
restrictions and, notwithstanding expectations that FY23 revenues
will now reflect the revised timing of already contracted project
milestones, the company is confident of its ability to continue to
deliver strong growth in 2023 and beyond.
Graham Curren, CEO of Sondrel, commented:
"In our first trading statement since our IPO I'm pleased to
report that we have delivered strong revenue growth, with design
wins in line with our expectations. We have started to deliver on
our growth strategy as set out at our IPO and progress has already
been made in expanding our operations in the United States.
I'm especially pleased to see such a strong adoption of our ASIC
services by customers, old and new, as evidenced by the recently
announced tapeout of an Edge AI ASIC project, production for which
is potentially worth $20 million to the Group over 3 years. In
addition, our engagement with a new company to finalise its ASIC
design and tape out demonstrates the strength of our offering.
Many of our customers are increasingly optimistic about their
market opportunities and I am looking forward to working with them
to deliver significant production volumes as we seek to achieve our
medium term target of revenues of over GBP100 million."
Sondrel (Holdings) plc Via Buchanan
Graham Curren, CEO Tel: +44 (0) 20 7466
5000
Joe Lopez, CFO
Cenkos Securities plc Tel: +44 (0)20 7397
8900
Ben Jeynes / Katy Birkin / George Lawson
- Corporate Finance
Alex Pollen / Michael Johnson - Sales
Buchanan Communications Tel: +44 (0) 20 7466
5000
Chris Lane sondrel@buchanan.uk.com
Stephanie Whitmore
Jack Devoy
Abby Gilchrist
About Sondrel
Sondrel is a UK-based fabless semiconductor company specialising
in high end, complex digital Application Specific Integrated
Circuits (ASICs) and System on Chips (SOCs). It provides a full
turnkey service in the design, prototyping, testing, packaging and
production of ASICs and SoCs.
The Company is one of only a few companies capable of designing
and supplying the higher-spec chips built on the most advanced
semiconductor technologies, selling into a range of hyper growth
end markets such as high-performance computing, automotive,
artificial intelligence, VR/AR, video analytics, image processing,
mobile networking and data centres. Sondrel designs have enabled
products by leading technology brands including Apple (iPhone),
Sony (PlayStation), Meta's (Oculus), Samsung, Google and Sony
smartphones, JVC (prosumer camcorders), Tesla and Mercedes-Benz
cars.
Sondrel is well-established, with a 20-year track record of
successful delivery, supported by long standing ecosystem
partnerships including Arm, TSMC and Samsung. Headquartered in the
UK, Sondrel has a global presence with offices in UK, USA, China,
India and Morocco.
For more information please visit: ir.sondrel.com
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