TIDMPEG
RNS Number : 6801M
Petards Group PLC
23 September 2021
23 September 2021
Petards Group plc
("Petards", "the Group" or "the Company")
Interim results for the six months ended 30 June 2021
Petards Group plc (AIM: PEG), the AIM quoted developer of
advanced security and surveillance systems, is pleased to report
its interim results for the six months ended 30 June 2021.
Key Highlights:
-- Operational
o Order book at 30 June 2021 GBP9 million (H1 2020: GBP12
million)
o Return to profitability at all levels and strong cash
generative performance
o eyeTrain deliveries and revenues recovered from H1 2020
COVID-19 related factors although order intake is still being
affected
o QRO continues to perform well with good contribution from
NASBox product acquisition
o Reduction in on-going cost base in 2020 has fed through to
improved gross profit margin
o Defence related activities on an improving trend
-- Financial
o Revenue GBP7.7 million (H1 2020: GBP7.1 million)
o Gross profit margin increased to 39.6% (H1 2020: 34.4%)
o Adjusted EBITDA GBP929,000 (H1 2020: GBP337,000)(1)
o Post-tax profit GBP430,000 (H1 2020: loss GBP469,000)
o Cash generated from operating activities GBP1,669,000 (H1
2020: GBP1,802,000)
o Net funds at 30 June 2021 increased to GBP2.7 million (31 Dec
2020: net funds GBP1.2 million)(2)
o Group's bankers replaced existing term loan with GBP0.5
million CBILS term loan and secured undrawn GBP2.5 million 3-year
CBILS overdraft facility to May 2024
o Diluted EPS 0.74p earnings (H1 2020: 0.82p loss)
(1. Earnings before financial income and expenses, tax,
depreciation, amortisation, share based payment charges and
exceptional restructuring costs)
2. Total net funds comprise cash and cash equivalents less
interest-bearing loans and borrowings (including lease
liabilities)
Commenting on the current outlook, Raschid Abdullah, Chairman,
said:
"The Board expects further progress to be made in the second
half year and while some customer delivery schedules are still
tending to change at short notice, trading presently remains
broadly in line with market expectations and the Board expects the
Group to deliver a cash generative performance for year."
This announcement includes inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations.
Contacts:
Petards Group plc www.petards.com
Raschid Abdullah, Chairman Mb: 07768 905004
WH Ireland Limited, Nomad and www.whirelandcb .com
Joint Broker
Mike Coe Tel: 0207 220 1666
Hybridan LLP, Joint Broker www.hybridan.com
Claire Louise Noyce Tel: 020 3764 2341
claire.noyce@hybridan.com
Chairman's statement
In the Outlook comment of my Chairman's Statement in May, I
informed shareholders that the first four months had started well
with all businesses broadly in line or slightly ahead of the
board's expectations in terms of profitability and revenue, with
revenues for 2021 expected to be weighted to the first half of the
year. This has proved to be the case with a return to profitability
for the Group at all levels in the six months to 30 June 2021,
demonstrating the inherent strength within the Group's businesses
to capitalise on, and deliver profitability and cash flow, when
levels of activity increase.
Revenues for the six months to 30 June 2021 increased to GBP7.7
million (H1 2020: GBP7.1 million) with Adjusted EBITDA increasing
to GBP929,000 (H1 2020: GBP337,000) and profit after tax to
GBP430,000 (H1 2020: GBP469,000 loss). The Group generated net cash
from operations of GBP1.7 million and closed the first half year
with increased cash balances of GBP3.5 million and net funds of
GBP2.7 million.
Business overview
Petards' operations continue to be focused upon the development,
supply and maintenance of technologies used in advanced security,
surveillance and ruggedised electronic applications, the main
markets for which are:
-- Rail - software driven video and other sensing systems for
on-train applications sold under the eyeTrain brand to global train
builders, integrators and rail operators, and web-based real-time
safety critical integrated software applications supporting the UK
rail network infrastructure sold under the RTS brand;
-- Traffic - Automatic Number Plate Recognition (ANPR) systems
for lane and speed enforcement and other applications, and UK Home
Office approved mobile speed enforcement systems, sold under the
QRO and ProVida brands to UK and overseas law enforcement agencies
and commercial customers; and
-- Defence - electronic countermeasure protection systems,
mobile radio systems and related engineering services sold
predominantly to the UK Ministry of Defence (MOD).
Operating review
The positive results and resultant cash generation in the first
half of 2021 are obviously welcome, although while overall order
intake for the period was similar to the first six months of 2020,
the picture remains uncertain in some markets served by the
Group.
This is particularly the case for the Group's eyeTrain business
which has suffered the most from lower and uncertain timing of
order inflow due to a combination of factors. These include the
impact on previously planned rolling stock maintenance and
replacement programmes of the Covid-19 induced 77% reduction in
passenger journeys in the year to 31 March 2021.
Furthermore, the UK Government's decision to create Great
British Railways has resulted in government exercising more direct
control over the train operating companies (TOCs) and a marked
slow-down of investment in both new and refurbished rolling stock.
This situation is likely to continue until such time as there is
tangible evidence of improvement in passenger numbers. In the
meantime, the action taken last year to reduce the eyeTrain
operation's cost base was timely, aligning it with currently
foreseen demand while maintaining its capability to serve customer
needs.
On more positive fronts, while new project orders are suffering
delays, RTS Solution's rail infrastructure focussed software
offering received licence and maintenance contract renewals
totalling GBP0.8 million in the period. The board regards this
business as having the potential to grow significantly in the
coming years and are expecting to see it develop on a broader front
by increasing both its range of software applications and its
customer base.
Since the board's decision last year to focus the Group's
Defence business on securing smaller orders, we have seen an
increase in both order intake and the potential for future orders.
Amongst these was the award by MOD of a 5-year framework contract
in June to support its J-Band Emitter Threat Simulator (JETS)
systems. In addition to on-going support of the systems, the
contract includes options for the MOD to place orders on Petards to
modernise existing JETS equipment, which is used for aircrew
training and flight trials, and to add new capabilities. While the
order inflow from this and other opportunities cannot be predicted
with a high degree of certainty, we hope to see solid progress in
this area of business.
QRO Solutions continued to improve its capabilities and its
position in its marketplace, building on its performance over the
past two years. I am also pleased to report that the GBP0.5 million
export contract to supply ProVida in car speed enforcement systems
to a new overseas customer is progressing to schedule and is to be
delivered shortly. Orders for NASBox, acquired in May 2020,
continue to grow as customers recognise its value as a fully
compliant and cost effective roadside ANPR solution. In August
these were supplemented by a GBP0.3 million order in support of the
policing of the 2022 Commonwealth Games.
Developing products and solutions for use in recognised areas
continue to feature as an important element of the board's strategy
for the development of each of the Group's product areas. At the
same time, acquisitions continue to be reviewed where it can be
demonstrated that they will enhance an existing business or will
provide another leg of the Group's business activities.
The Group's ungeared balance sheet and available financing
facilities provide the board with the ability to selectively use
debt to fund smaller acquisitions. The Board does not preclude
undertaking a larger acquisition relative to the Group's size in
the event it would accelerate the Group's growth and create value
for shareholders.
Either way, acquisitions, whether in the future or those
currently under consideration, would be expected to complement the
Board's 'buy & build' strategy as well as having the ability to
improve and grow Returns on Investment ('ROI) in the medium to
longer term and contribute to the growth of the Group.
Financial review
Operating performance
Revenues for the six months ended 30 June 2021 increased to
GBP7.7 million (H1 2020: GBP7.1 million) with the improvement over
the comparable period in 2020 the result of stronger eyeTrain
system shipments and after sales support services. The Group's
other products experienced revenues that were slightly below those
for the first half of 2020.
Defence service revenues included the final delivery of
electronic countermeasures equipment for an MOD programme, the
majority of which was shipped in the first half of 2020. Excluding
the effect of that particular contract, after a weaker second half
of 2020, Defence revenues recovered to a similar level achieved in
the first half of 2020.
QRO continues to perform strongly and while its revenues were
slightly lower than the comparable period in 2020, this was due to
primarily to the timing of customer installations which slipped
into July and August. Coupled with the delivery of circa GBP0.5
million of ProVida systems later this month to a new overseas
customer, QRO is expected to record particularly strong third
quarter revenues.
RTS performed broadly to expectations, albeit revenues were
lower than the first half of 2020 which included project revenues
in addition to its strong recurring revenue base. While not greatly
affecting the first half of 2021, the timing of placement of orders
is being affected by the creation of Great British Railways,
slowing down decision making on new projects.
The Group's overall gross profit margin increased significantly
to 39.6% (H1 2020: 34.4%), with improvements seen across all areas
of the business. This was in part due to the benefit of the cost
reductions implemented during 2020 coming through, coupled with
eyeTrain revenues for the period including a higher level of
service income. Another significant ongoing benefit was that the
eyeTrain equipment sales were predominantly for previously
developed and supplied equipment and therefore not diluted by
non-recurring costs that have affected margin in recent years.
Administrative expenses before exceptional items were broadly
speaking unchanged at GBP2.6 million (H1 2020: GBP2.9 million,
including GBP0.3 million exceptional restructuring costs).
Adjusted EBITDA for the period grew to GBP929,000 (H1 2020:
GBP337,000 before exceptional costs of GBP305,000), and with
amortisation and depreciation charges at similar levels to the
prior year, the Group generated an operating profit of GBP454,000
(H1 2020: GBP468,000 loss). Net financial expenses, which
predominantly relate to the Group's term loan and lease
liabilities, totalled GBP24,000 (H1 2020: GBP38,000).
After a nil tax charge (H1 2020: GBP37,000 credit), the Group's
profit after tax was GBP430,000 (H1 2020: GBP469,000 loss) and the
basic and diluted earnings per share were 0.75p and 0.74p
respectively (H1 2020: basic and diluted loss of 0.82p).
Cash, cash flow and net debt
The Group again recorded a strongly cash generative performance
with net cash from operating activities in the period totalling
GBP1.7 million (H1 2020: GBP1.8 million). This included a temporary
reduction in working capital of GBP0.7 million which reversed
shortly after period end. The second half year is expected to
benefit from the receipt of R&D tax credits, although these are
not yet agreed and will be less than amounts received in 2020.
The main area of investment for the period related to the
acquisition of operational and demonstration assets for QRO. Cash
outflows from investing activities were lower at GBP0.1 million (H1
2020: GBP0.2 million), with minimal expenditure on eyeTrain related
capitalised R&D following the significant investment made in
the recent past.
After repayment of debt and interest of GBP0.1 million, cash
balances increased to GBP3.5 million (31 December 2020: GBP2.2
million).
Net funds at 30 June 2021, after deducting term loan and lease
liabilities, grew to GBP2.7 million from GBP1.2 million at 31
December 2020. Following the replacement in May of its previous
banking facilities with a CBILS GBP0.5 million 2-year term loan and
a GBP2.5 million 3-year overdraft facility, and with its existing
cash resources, the Group has plenty of capacity to fund its future
growth and working capital requirements.
Outlook
All of the Group's activities delivered profits and cash inflow
for period to 30 June 2021, and other than eyeTrain, order intake
either continued strongly as was the case with QRO or was on an
upward trend. However, the reduced customer activity levels and
order visibility for eyeTrain, the Group's largest revenue
producer, are being closely monitored.
The reduction in the Group's order book to GBP9 million at 30
June 2021 reflects this lower eyeTrain activity, down from GBP12
million at both 30 June and 31 December 2020. However, with an
increasing number of opportunities relating to train refurbishment
and retrofit projects, the lead times for these from order
placement to delivery tend to be relatively short compared with
those for new build train projects.
Nevertheless, against this backdrop, the Board expects further
progress to be made in the second half year. While some customer
delivery schedules are still tending to change at short notice,
trading presently remains broadly in line with market expectations
and the Board expects the Group to deliver a cash generative
performance for year.
Raschid Abdullah
23 September 2021
Condensed Consolidated Income Statement
for the six months ended 30 June 2021
Unaudited Unaudited
6 months 6 months Audited
ended 30 ended 30 Year ended
June June 31 December
Note 2021 2020 2020
GBP000 GBP000 GBP000
Revenue 7,692 7,092 13,001
Cost of sales (4,647) (4,655) (8,267)
Gross profit 3,045 2,437 4,734
Administrative expenses (2,591) (2,905) (5,879)
---------- --------- ------------
Adjusted EBITDA* 929 337 320
Amortisation of intangibles (297) (315) (637)
Depreciation of property,
plant and equipment (99) (107) (244)
Amortisation of right of
use assets (63) (67) (133)
Share based payment charges (16) (11) (26)
Exceptional restructuring
costs 4 - (305) (425)
Operating profit/(loss) 454 (468) (1,145)
Financial income - 4 -
Financial expenses (24) (42) (93)
Profit/(loss) before tax 430 (506) (1,238)
Income tax 5 - 37 655
Profit/(loss) for the period
attributable to equity shareholders
of the company 430 (469) (583)
Other comprehensive income - - -
Total comprehensive income/(expense)
for the period 430 (469) (583)
---------- --------- ------------
Earnings/(loss) per ordinary
share (pence)
Basic 9 0.75 (0.82) (1.01)
Diluted 9 0.74 (0.82) (1.01)
---------- --------- ------------
* Earnings before financial income and expenses, tax,
depreciation, amortisation, share based payment charges and
exceptional restructuring costs
Condensed Consolidated Statement of Changes in Equity
for the six months ended 30 June 2021
Share Share Equity Retained Total
capital premium reserve earnings equity
GBP000 GBP000 GBP000 GBP000 GBP000
At 1 January 2020 (audited) 575 1,617 14 5,272 7,478
Loss for the period - - - (469) (469)
Total comprehensive income
for the period - - - (469) (469)
Exercise of share options - 7 - - 7
Equity settled share based
payments - - - 11 11
At 30 June 2020 (unaudited) 575 1,624 14 4,814 7,027
-------- -------- -------- --------- -------
At 1 January 2020 (audited) 575 1,617 14 5,272 7,478
Loss for the year - - - (583) (583)
Total comprehensive expense
for the year - - - (583) (583)
Exercise of share options - 7 - - 7
Equity settled share based
payments - - - 26 26
At 31 December 2020 (audited) 575 1,624 14 4,715 6,928
-------- -------- -------- --------- -------
At 1 January 2021 (audited) 575 1,624 14 4,715 6,928
Profit for the period - - - 430 430
Total comprehensive expense
for the period - - - 430 430
Equity settled share based
payments - - - 16 16
At 30 June 2021 (unaudited) 575 1,624 14 5,161 7,374
-------- -------- -------- --------- -------
Condensed Consolidated Statement of Financial Position
at 30 June 2021
Unaudited Unaudited Audited
30 June 30 June 31 December
2021 2020 2020
GBP000 GBP000 GBP000
ASSETS
Non-current assets
Property, plant and equipment 761 894 761
Right of use assets 324 397 387
Intangible assets 4,341 4,699 4,617
Investments 5 - 5
Deferred tax assets 522 469 522
--------- --------- ------------
5,953 6,459 6,292
--------- --------- ------------
Current assets
Inventories 2,738 2,420 2,372
Trade and other receivables 6 1,890 3,580 2,645
Cash and cash equivalents 3,549 2,174 2,204
--------- --------- ------------
8,177 8,174 7,221
--------- --------- ------------
Total assets 14,130 14,633 13,513
========= ========= ============
EQUITY AND LIABILITIES
Equity attributable to equity
holders
of the parent
Share capital 575 575 575
Share premium 1,624 1,624 1,624
Equity reserve 14 14 14
Retained earnings 5,161 4,814 4.715
Total equity 7,374 7,027 6,928
--------- --------- ------------
Non-current liabilities
Interest-bearing loans and
borrowings 8 463 784 649
--------- --------- ------------
463 784 649
--------- --------- ------------
Current liabilities
Interest-bearing loans and
borrowings 8 374 364 376
Trade and other payables 7 5,919 6,458 5,560
--------- --------- ------------
6,293 6,822 5,936
--------- --------- ------------
Total liabilities 6,756 7,606 6,585
--------- --------- ------------
Total equity and liabilities 14,130 14,633 13,513
========= ========= ============
Condensed Consolidated Statement of Cash Flows
for the six months ended 30 June 2021
Unaudited Unaudited Audited
6 months 6 months Year ended
ended 30 June ended 30 June 31 December
2021 2020 2020
GBP000 GBP000 GBP000
Cash flows from operating activities
Profit/(loss) for the period 430 (469) (583)
Adjustments for:
Depreciation of property, plant
and equipment 99 116 244
Amortisation of right of use
assets 63 58 133
Amortisation of intangible assets 297 315 637
Loss on disposal of property,
plant and equipment - - 1
Profit on disposal of right
of use assets (8) - (5)
Financial income - (4) -
Financial expenses 24 42 93
Equity settled share-based payment
expenses 16 11 26
Income tax charge/(credit) - (37) (655)
Operating cash flows before
movement in
working capital 921 32 (109)
Change in inventories (366) 10 58
Change in trade and other receivables 740 (632) 226
Change in trade and other payables 359 1,426 563
Cash generated from operations 1,654 836 738
Tax received 15 966 1,660
Net cash from operating activities 1,669 1,802 2,398
Cash flows from investing activities
Acquisition of property, plant
and equipment (99) (23) (33)
Sale of right of use assets 8 - 16
Acquisition of intangible assets - (80) (150)
Capitalised development expenditure (21) (131) (371)
Acquisition of investments - - (5)
Interest received - 4 -
Net cash outflow from investing
activities (112) (230) (543)
Cash flows from financing activities
Bank loan repaid (125) (125) (250)
Interest paid on lease liabilities (14) (11) (20)
Interest paid on loans and borrowings (10) (20) (33)
Principal paid on lease liabilities (61) (65) (138)
Other interest and foreign exchange
losses (2) (11) (44)
Proceeds from exercise of share
options - 7 7
Net cash outflow from financing
activities (212) (225) (478)
Net increase in cash and cash
equivalents 1,345 1,347 1,377
Total movement in cash and cash
equivalents
in the period 1,345 1,347 1,377
Cash and cash equivalents at
1 January 2,204 827 827
Cash and cash equivalents 3,549 2,174 2,204
Notes to the financial statements
1. Reporting entity
Petards Group plc (the 'Company') is incorporated and domiciled
in England and its shares are publicly traded on AIM, a market
operated by the London Stock Exchange. These condensed consolidated
interim financial statements ('interim financial statements') as at
and for the six months ended 30 June 2021 comprise the Company and
its subsidiaries (together referred to as the 'Group').
Copies of these interim financial statements will be available
on the Company's website (www.petards.com) and from the Company's
registered office at Parallel House, 32 London Road, Guildford, GU1
2AB.
2. Basis of preparation
As permitted, these interim financial statements have been
prepared in accordance with AIM Rules for Companies and are not
required to comply with IAS 34 'Interim Financial Reporting' to
maintain compliance with IFRS. They should be read in conjunction
with the Group's last annual consolidated financial statements as
at and for the financial year ended 31 December 2020 ('last annual
financial statements'). They do not include all of the financial
information required for a complete set of IFRS financial
statements, however selected explanatory notes are included to
explain events and transactions that are significant to the
understanding of the changes in the Group's financial position and
performance since the last annual financial statements. This
financial information does not constitute statutory accounts as
defined in Section 435 of the Companies Act 2006.
The comparative figures for the financial year ended 31 December
2020 set out in these interim statements are not the Group's
statutory accounts for that financial year. Those accounts have
been reported on by the Company's auditors and delivered to the
Registrar of Companies. The report of the auditors was (i)
unqualified, (ii) did not include a reference to any matters to
which the auditor drew attention by way of emphasis without
qualifying their report, and (iii) did not contain a statement
under section 498 (2) or (3) of the Companies Act 2006.
3. Use of judgements and estimates
In preparing these interim financial statements, management has
made judgements and estimates that affect the application of
accounting policies and the reported amounts of assets,
liabilities, income and expense. Actual amounts may differ from
these estimates.
The significant judgements made by management in applying the
Group's accounting policies and the key sources of estimation
uncertainty were the same as those described in the last annual
financial statements.
4. Exceptional restructuring costs
During the year to 31 December 2020 the Group restructured the
cost base of certain parts of the business. The cost of this
exercise was GBP425,000 of which GBP305,000 was incurred in the six
months to 30 June 2020.
5. Taxation
No provision for taxation has been made in the Condensed
Consolidated Income Statement for the six months to 30 June 2021
based on the estimated tax provision required for the year ending
31 December 2021 (H1 2020: GBP37,000 credit).
6. Trade and other receivables
Unaudited Unaudited
6 months 6 months Audited
ended 30 ended 30 Year ended
June June 31 December
2021 2020 2020
GBP000 GBP000 GBP000
Trade receivables 1,734 3,076 2,381
Corporation tax recoverable - 96 15
Other receivables and prepayments 156 408 249
1,890 3,580 2,645
========== ========== =============
7. Trade and other payables
Unaudited
Unaudited 6 months Audited
6 months ended 30 Year ended
ended 30 June June 31 December
2021 2020 2020
GBP000 GBP000 GBP000
Trade payables 1,487 1,471 1,434
Contract liabilities 1,621 2,580 1,177
Non-trade payables and accrued
expenses 2,811 2,407 2,949
5,919 6,458 5,560
=============== ========== =============
8. Interest-bearing loans and borrowings
Current liabilities
Unaudited Unaudited
6 months 6 months Audited
ended 30 ended 30 Year ended
June June 31 December
2021 2020 2020
GBP000 GBP000 GBP000
Bank loan 250 250 252
Lease liabilities 124 114 124
---------- ---------- -------------
374 364 376
========== ========== =============
Non-current liabilities
Unaudited Unaudited
6 months 6 months Audited
ended 30 ended 30 Year ended
June June 31 December
2021 2020 2020
GBP000 GBP000 GBP000
Bank loan 250 500 375
Lease liabilities 213 284 274
---------- ---------- -------------
463 784 649
========== ========== =============
9. Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit
for the period attributable to the shareholders by the weighted
average number of shares in issue.
Unaudited Unaudited
6 months 6 months Audited
ended 30 ended 30 Year ended
June June 31 December
2021 2020 2020
Earnings
Profit/(loss) for the period
(GBP000) 430 (469) (583)
========= ========= ============
Number of shares
Weighted average number of ordinary
shares ('000) 57,528 57,524 57,526
========= ========= ============
Diluted earnings per share
Diluted earnings per share assumes conversion of all potentially
dilutive ordinary shares, which arise from share options that would
decrease earnings per share or increase loss per share from
continuing operations and is calculated by dividing the adjusted
profit for the year attributable to the shareholders by the assumed
weighted average number of shares in issue. Due to the losses in
2020, share options in issue in 2020 had an anti-dilutive
effect.
Unaudited Unaudited
6 months 6 months Audited
ended 30 ended 30 Year ended
June June 31 December
2021 2020 2020
Earnings
Profit/(loss) for the period
(GBP000) 430 (469) (583)
========= ========= ============
Number of shares
Weighted average number of ordinary
shares ('000) 57,791 57,524 57,526
========= ========= ============
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END
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(END) Dow Jones Newswires
September 23, 2021 02:00 ET (06:00 GMT)
Petards (AQSE:PEG.GB)
過去 株価チャート
から 10 2024 まで 11 2024
Petards (AQSE:PEG.GB)
過去 株価チャート
から 11 2023 まで 11 2024
