Prior to
publication, the information contained within this announcement was
deemed by Deltex Medical Group PLC to constitute inside information
as stipulated under the UK Market Abuse Regulation
23 September 2024
Deltex Medical Group
plc
("Deltex
Medical" or the "Group")
Interim results to 30 June
2024
Deltex Medical Group plc (AIM: DEMG), the global leader in oesophageal Doppler monitoring, today
announces its unaudited interim results for the six months ended 30
June 2024 ("H1 2024" or the
"Period").
HIGHLIGHTS
Financial
§ Unaudited
revenue for H1 2024 was flat at £1.1 million (H1 2023: £1.1
million), on substantially lower cash-adjusted overheads
§ 39%
reduction in sales and marketing costs during the Period to
£259,000 (H1 2023: £425,000)
§ Cash-adjusted overheads in the Period reduced by 35% to £1.0
million (H1 2023: £1.5 million)
§ Significantly improved adjusted EBITDA loss of £274,000 (H1
2023: loss of £361,000)
§ Cash at
hand on 30 June 2024 was £326,000 (H1 2023: £107,000)
Business / commercial activities
§ Quotations
growing for the new TrueVue monitor - with orders beginning to
climb, particularly from overseas territories
§ Encouraging levels of orders for the previous version of the
Group's monitor
§ 14%
increase in sales of single-use probes in the International
division
§ Opportunities for direct sales of Deltex Medical's technology
into the UK appear to be increasing
§ Ongoing
research work carried out for the new, novel non-invasive device
during the Period
§ Natalie
Wettler, current Group Finance Director, promoted to also be the
Chief Operating Officer, reflecting her increased involvement in
the operational management of the Group in 2024. While Natalie
Wettler will maintain her finance responsibilities, this will
enable the CEO, Andy Mears, to spend more time marketing and
selling the new TrueVue monitor, particularly in overseas
territories
Nigel Keen, Chairman of Deltex
Medical, said:
"The new TrueVue monitor is beginning to show signs of
traction, particularly in a number of overseas territories,
although the timing of orders remains difficult to
predict."
"The prospects for the new, novel non-invasive device remains
exciting and we are encouraged by the results of the research
carried out in the Period."
"The Board is pleased that Natalie Wettler - the Group's
Finance Director - has accepted an additional role as Chief
Operating Officer. This will enable Andy Mears, the CEO, to spend
more time driving sales of the new TrueVue monitor, particularly
into overseas territories where we are seeing increasing
demand."
For further information, please
contact:
|
Deltex Medical Group
plc
|
01243 774 837
|
|
Nigel Keen, Chairman
|
investorinfo@deltexmedical.com
|
|
Andy Mears, Chief
Executive
|
|
|
Natalie Wettler, Group Finance
Director & Chief Operating Officer
|
|
|
|
|
|
|
Allenby Capital Limited - Nominated
Adviser & Broker
|
020 3328 5656
|
|
Jeremy Porter / Vivek Bhardwaj
(Corporate Finance)
|
info@allenbycapital.com
|
|
Tony Quirke / Stefano Aquilino
(Sales & Corporate Broking)
|
|
|
|
|
| |
Notes for
Editors
Deltex Medical's
technology
Deltex Medical's TrueVue System uses
proprietary haemodynamic monitoring technology to assist clinicians
to improve outcomes for patients as well as increase throughput and
capacity for hospitals.
Deltex Medical has invested over the
long term to build a unique body of peer-reviewed, published
evidence from a substantial number of trials carried out around the
world. These studies demonstrate statistically significant
improvements in clinical outcomes providing benefits both to
patients and to the hospital systems by increasing patient
throughput and expanding hospital capacity.
The Group's flagship, world-leading,
ultrasound-based oesophageal doppler monitoring ("ODM") is
supported by 24 randomised control trials conducted on
anaesthetised patients. As a result, the primary application for
ODM is focussed on guiding therapy for patients undergoing elective
surgery, although sedated patients in intensive care are still an
important part of our business. The Group's new, next generation
monitor makes the use of the ODM technology more intuitive and
provides augmented data on the status of each patient.
Deltex Medical's engineers and
scientists carried out successful research in conjunction with the
UK's National Physical Laboratory ("NPL"), which has enabled the
Group's 'gold standard' ODM technology to be extended and developed
so that it can be used completely non-invasively. This will
significantly expand the application of Deltex Medical's technology
to non-sedated patients. This new technological enhancement, which
will be released on the new next generation monitor, will
substantially increase the addressable market for the Group's
haemodynamic monitoring technologies and is complementary to the
long-established ODM evidence base.
Deltex Medical's new non-invasive
technology has potential applications for use in a number of
healthcare settings, including:
§ Accident
& Emergency for the rapid triage of patients, including the
detection and diagnosis of sepsis;
§ in general
wards to help facilitate a real-time, data-driven treatment regime
for patients whose condition might deteriorate rapidly;
and
§ in
critical care units to allow regular monitoring of patients
post-surgery who are no longer sedated or intubated.
One of the key opportunities for the
Group is positioning this new, non-invasive technology for use
throughout the hospital. Deltex Medical's haemodynamic monitoring
technologies provide clinicians with beat-to-beat real-time
information on a patient's circulating blood volume and heart
function. This information is critical to enable clinicians to
optimise both fluid and drug delivery to patients.
Deltex Medical's business model is
to drive the recurring revenues associated with the sale of
single-use disposable ODM probes which are used in the TrueVue
System and to complement these revenues with a new incremental
revenue stream to be derived from the Group's new non-invasive
technology.
Both the existing single-use ODM
probe and the new, non-invasive device will connect to the same,
new TrueVue monitor which was released onto the market in November
2023. Monitors are sold or, due to hospitals' often protracted
procurement times for capital items, may be loaned in order to
encourage faster adoption of the Group's technology.
Deltex Medical's
customers
The principal users of Deltex
Medical's products are currently anaesthetists working in a
hospital's operating theatre and intensivists working in ICUs. This
customer profile will change as the Group's new non-invasive
technology is adopted by the market. In the UK the Group sells
directly to the NHS. In the USA the Group sells directly to a range
of hospital systems. The Group also sells through distributors in
more than 40 countries in the European Union, Asia and the
Americas.
Deltex Medical's
objective
To see the adoption of Deltex
Medical's new TrueVue monitor, comprising both minimally invasive
and non-invasive technologies, as the standard of care in
haemodynamic monitoring for all patients from new-born to adult,
awake or anaesthetised, across all hospital settings
globally.
For further information please go
to www.deltexmedical.com
Chairman's statement
Financial results
Unaudited revenue for the six months
ended 30 June 2024 was flat at £1.1 million (H1 2023: £1.1
million).
It is
encouraging that similar revenue levels to the comparative
reporting period in 2023 were achieved in the Period with a
substantially lower cost base:
§ the head
count in the Period comprised 24 employees, compared with 40 in H1
2023;
§ expenditure on sales and marketing decreased by £166,000 (39%)
to £259,000 (H1 2023: 425,000); and
§ cash-adjusted overheads in the Period decreased by 35% to
£996,000 (H1 2023: £1,524,000). Further information on the
cash-adjusted decrease in overheads in the Period is set out below
in Note 6 of the unaudited financial statements.
The significantly lower level of
capitalised development expenditure reflects the successful launch
of the new TrueVue monitor.
Although the revenue line is not yet
benefiting from a substantial volume of sales of the new TrueVue
monitor, it is encouraging that enquiries and orders in relation to
the TrueVue monitor have been growing, particularly from the
Group's network of some 40 overseas distributors.
Single-use ODM probe revenues
associated with purchases by the Group's international distributors
were also encouraging, with an increase of 14% in the Period, which
helped offset a slight decline in single-use ODM probe orders in
the UK.
Notwithstanding the cost reduction
programme last year, the Group remains highly operationally geared.
It is structured so that it can manufacture and deliver
significantly higher volumes of both monitors and probes without
adding substantially to its current level of overheads.
The gross margin in the Period was
broadly unchanged at 67% (H1 2023: 69%). The slight reduction in
gross margin in H1 2024 reflects higher levels of lower margin
sales of probes to international distributors as well as the effect
of reduced manufacturing-related recoveries, and associated
inefficiencies, in the first half as production of the new TrueVue
monitor was ramped up.
Adjusted EBITDA, which comprises the
operating loss adjusted for depreciation, amortisation,
equity-settled non-executive directors' fees, share-based payments
and certain other items, significantly improved by £99,000 with a
loss of £274,000 (H1 2023:£(361,000)).
In contrast to the first half of
2023, where the adjusted EBITDA was negative every month, in H1
2024 there were two months when the adjusted EBITDA was
positive.
Loss before taxation in the Period
was essentially unchanged at £546,000 (H1 2023:
£537,000).
Cash at hand as at 30 June 2024 was
£326,000 (H1 2023: £107,000).
Commercial and business activities
New 'TrueVue' monitor
There has been increasing and
encouraging levels of interest in the new TrueVue monitor in the
markets where it has been launched, including the UK, the EU and in
other markets that accept the European Union's CE mark.
In the UK, the new TrueVue System
has been successfully included on the NHS Supply Chain national
framework and first units have been delivered to an NHS hospital.
The Group anticipates selling further units into NHS hospitals in
the second half of the current financial year, although there
remain some uncertainties around capital expenditure budgets in the
UK.
In H1 2024, orders for the TrueVue
monitor from continental Europe largely related to purchases by the
Group's long-standing network of international distributors that
are gearing up to aggressively promote the new TrueVue monitor in
the fourth quarter of the year.
Sales of the new TrueVue monitor
have commenced in Latin America where two countries have completed
local registration filings. The Group believes that there should be
further orders from Latin America in the second half of the current
financial year, although the timing of cash receipts from this
region can be challenging.
In anticipation of increased levels
of future overseas sales, the Group's network of international
distributors has been expanded and strengthened since the beginning
of the year. In particular, new distributors have been signed up
and trained in Latin America and in South East Asia where there
appears to be encouraging levels of interest in the Group's ODM
technology.
Since the beginning of the year,
significant work has taken place at the Group's Chichester
headquarters across a number of disciplines relating to the
optimisation of assembly processes required for the production of
the new TrueVue monitor. A small number of minor "teething" issues
were identified, which have now been successfully addressed.
Confidence in the production processes is growing. The fully-loaded
manufacturing costs for the new TrueVue monitor are beginning to
decline to anticipated levels as production volumes and associated
efficiencies climb.
To reflect the increasing
involvement of Natalie Wettler in the operational management of the
Group, the Board has promoted Natalie, the current Group Finance
Director, to also be the Chief Operating Officer. In addition to
retaining her Finance Director responsibilities, she will be
charged with spending time on improving the Group's operational
activities, including the production facilities, responsibilities
that Natalie has been gradually increasing this year. This change
in management structure will enable Andy Mear's, Deltex Medical's
Chief Executive Officer, to spend more time on new sales
initiatives in the UK and internationally for the new TrueVue
monitor, securing tenders for the previous version of the monitor,
working more closely with the Group's network of overseas
distributors selling across the International Division and also
carrying out 'voice of the customer' market research for the
Group's new non-invasive device.
Previous version of the TrueVue monitor
Deltex Medical often responds to
large tenders for haemodynamic monitoring technology that remain
extant for a number of years. As a result, the Group is still
winning, and in some cases waiting to hear the outcome of, a number
of international tenders on which it has been working for some time
with its in-country distributors. Accordingly, the Group is still
expecting to win orders for the previous version of the TrueVue
monitor; and it has sufficient sub-assemblies and components in
stock to be able to rapidly and profitably convert these stock
holdings into cash via these historic tender wins.
During the Period there was an
encouraging level of orders relating to the previous version of the
monitor from a number of distributors. These orders are likely to
drive concomitant international probe revenues which is anticipated
to help build the Group's book of high margin, recurring revenues
associated with its single use probes.
It will inevitably take some time to
complete all the necessary regulatory filings for the new TrueVue
monitor. Whilst these regulatory submissions are taking place,
including in the critical USA market via a 510(k) submission, the
Group is positioned to sell the previous version of the monitor in
order to help it retain market share.
US regulatory approval for the
TrueVue monitor is expected to be granted during 2025.
The veterinary version of the
previous monitor has been launched in China and the first order is
expected to be received later this year.
Sale of single use probes
Single-use ODM probe revenues increased slightly in the Period to £824,000
(H1 2023: £815,000).
Probe sales in the International
division, which rely on purchases by distributors, increased by
14%. This increase helped offset a decline in probe revenues in the
UK market, believed to be associated with market uncertainty as to
the timing of the launch of the new monitor.
The Group highlights that the same
single-use ODM probes are used in the new TrueVue monitor as well
as in the previous version of Deltex Medical's monitor.
Accordingly, as sales of the new TrueVue monitor increase, then
probe revenues are also expected to grow.
New
product development
Notwithstanding the focus on the
launch of the TrueVue monitor, Deltex Medical's technologists have
also made good progress on further research to advance its novel,
non-invasive version of Deltex Medical's ODM technology.
The Group believes that this new,
non-invasive device, which should have a substantially larger
addressable market in terms of applications within hospitals as
well as in primary care settings, represents a significant
opportunity for the Group to build substantial revenues in the
future.
Although this new non-invasive
device is still in the research phase, the Group is working on the
basis that it will ultimately end up representing a form of digital
haemodynamic stethoscope. This will give healthcare workers,
ranging from doctors to nurses across a range of departments,
immediate access to high quality, real-time haemodynamic data in
respect of their patients. This data is expected to give rise to
improved and more rapid treatment of patients throughout a hospital
or other clinical care-giving facility such as the Accident &
Emergency department or a primary care (GP) doctor's
surgery.
Further progress on the necessary
research work associated with this novel non-invasive device is
expected during the second half of this financial year as
significantly less technical support will be required from the
Group's engineers to support the increase in production volumes of
the new TrueVue monitor.
Market feedback and 'voice of the
customer' work continues on this new non-invasive technology to
enable the Group to develop an optimised commercialisation plan in
advance of its launch.
Current trading and prospects
The Group's performance in H1 2024
was encouraging and was broadly in line with internal
budgets.
Sales of the new TrueVue monitor are
still building and have not reached their anticipated run rate. It
remains difficult to predict the timing and quantum of orders for
the new monitor, in part as many sales are carried out by
international distributors.
As expected, direct sales were a
little slow over the summer months, although a number of
significant orders were received from Latin America which require
onerous documentation to be satisfied prior to shipment.
The Group remains focussed on
driving up sales of the new TrueVue Monitor whilst its technical
teams continue their work on the new, novel non-invasive ODM
device.
Deltex Medical continues to take
robust actions in order to attain EBITDA positive
trading.
Nigel Keen
Chairman
20 September 2024
Condensed Consolidated Statement of Comprehensive
Income
For the period ended 30 June
2024
|
|
|
Unaudited
|
Audited
|
|
|
Note
|
Six months ended
30 June
2024
£'000
|
Six
months
ended
30
June
2023
£'000
|
Year
ended
31
December 2023
£'000
|
|
Revenue
|
4
|
1,064
|
1,059
|
1,776
|
|
Cost of sales
|
|
(353)
|
(331)
|
(651)
|
|
Gross profit
|
|
711
|
728
|
1,125
|
|
Administrative expenses
|
|
(597)
|
(642)
|
(1,081)
|
|
Sales and distribution
expenses
|
|
(262)
|
(427)
|
(685)
|
|
Research and Development, Quality
and Regulatory
|
|
(294)
|
(116)
|
(217)
|
|
Exceptional Costs
|
9
|
-
|
-
|
(366)
|
|
Total costs
|
|
(1,153)
|
(1,185)
|
(2,349)
|
|
Other gain
|
8
|
-
|
40
|
172
|
|
Operating loss
|
|
(442)
|
(417)
|
(1,052)
|
|
Finance costs
|
|
(104)
|
(119)
|
(230)
|
|
Loss before taxation
|
|
(546)
|
(536)
|
(1,282)
|
|
Tax credit adjustment
|
8
|
-
|
(1)
|
-
|
|
Loss for the period/year
|
|
(546)
|
(537)
|
(1,282)
|
|
|
|
|
|
|
|
Other comprehensive income/(expense)
|
|
|
|
|
|
Items that may be reclassified to
profit or loss:
|
|
|
|
|
|
Net translation differences on
overseas subsidiaries
|
|
4
|
6
|
5
|
|
Other comprehensive income/(expense)
for the period/year, net of tax
|
|
4
|
6
|
5
|
|
Total comprehensive loss for the period/year
|
|
(542)
|
(531)
|
(1,277)
|
|
|
|
|
|
|
|
Total comprehensive loss for the period/year attributable
to:
|
|
|
|
|
|
Owners of the Parent
|
|
(541)
|
(532)
|
(1,252)
|
|
Non-controlling interests
|
|
(1)
|
1
|
(25)
|
|
|
|
(542)
|
(531)
|
(1,277)
|
|
|
|
|
|
|
|
Loss per share - basic and
diluted
|
10
|
(0.03)p
|
(0.08)p
|
(0.11p)
|
|
|
|
|
|
|
4.
Revenue
The following table
provides an analysis of the Group's sales by revenue stream and
markets. This information is regularly provided to the Group's
CODM:
|
For the six months ended 30
June 2024 (Unaudited)
|
|
|
Direct
markets
|
Indirect markets
|
|
|
|
Probes
|
Monitors
|
Other
|
Probes
|
Monitors
|
Other
|
Total
|
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
|
UK
|
186
|
12
|
22
|
-
|
-
|
-
|
220
|
|
|
USA
|
134
|
-
|
26
|
-
|
-
|
-
|
160
|
|
|
France
|
-
|
-
|
-
|
179
|
9
|
4
|
192
|
|
|
Latin America
|
-
|
-
|
-
|
85
|
67
|
1
|
153
|
|
|
Portugal
|
-
|
-
|
-
|
126
|
-
|
-
|
126
|
|
|
Scandinavia
|
-
|
-
|
-
|
33
|
5
|
1
|
39
|
|
|
South Korea
|
-
|
-
|
-
|
38
|
-
|
-
|
38
|
|
|
Other countries
|
1
|
-
|
-
|
42
|
91
|
2
|
136
|
|
|
|
321
|
12
|
48
|
503
|
172
|
8
|
1,064
|
|
|
For the
six months ended 30 June 2023 (Unaudited)
|
|
|
Direct
markets
|
Indirect markets
|
|
|
|
Probes
|
Monitors
|
Other
|
Probes
|
Monitors
|
Other
|
Total
|
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
|
UK
|
212
|
113
|
15
|
-
|
-
|
-
|
340
|
|
|
USA
|
156
|
4
|
20
|
-
|
-
|
-
|
180
|
|
|
France
|
-
|
-
|
-
|
248
|
-
|
2
|
250
|
|
|
Scandinavia
|
-
|
-
|
-
|
49
|
-
|
1
|
50
|
|
|
Latin America
|
-
|
-
|
-
|
37
|
-
|
-
|
37
|
|
|
Hong Kong
|
-
|
-
|
-
|
6
|
62
|
-
|
68
|
|
|
Portugal
|
-
|
-
|
-
|
63
|
-
|
-
|
63
|
|
|
Other countries
|
5
|
-
|
1
|
39
|
22
|
4
|
71
|
|
|
|
373
|
117
|
36
|
442
|
84
|
7
|
1,059
|
|
|
For the
year ended 31 December 2023 (Audited)
|
|
|
Direct
markets
|
Indirect markets
|
|
|
|
Probes
|
Monitors
|
Other
|
Probes
|
Monitors
|
Other
|
Total
|
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
|
UK
|
394
|
113
|
42
|
-
|
-
|
-
|
549
|
|
|
USA
|
287
|
20
|
40
|
-
|
-
|
-
|
347
|
|
|
France
|
-
|
-
|
-
|
283
|
-
|
2
|
285
|
|
|
Portugal
|
|
|
|
185
|
-
|
-
|
185
|
|
|
Latin America
|
-
|
-
|
-
|
91
|
16
|
-
|
107
|
|
|
Scandinavia
|
|
|
|
64
|
4
|
1
|
69
|
|
|
Hong Kong
|
-
|
-
|
-
|
6
|
62
|
-
|
68
|
|
|
South Korea
|
|
|
|
47
|
5
|
4
|
56
|
|
|
Other countries
|
10
|
6
|
3
|
56
|
32
|
3
|
110
|
|
|
|
691
|
139
|
85
|
732
|
119
|
10
|
1,776
|
|
|
|
|
|
|
|
|
|
|
| |
The Group's revenue disaggregated
between the sale of goods and the provision of services is set out
below. All revenues from the sale of goods are recognised at a
point in time; maintenance income is recognised at the point the
service is carried out.
|
|
Period ended
|
Year ended
|
|
|
30 June
2024
|
30 June
2023
|
31
December 2023
|
|
|
£'000
|
£'000
|
£'000
|
|
Sale of goods
|
1,046
|
1,038
|
1,732
|
|
Maintenance income
|
18
|
21
|
44
|
|
|
1,064
|
1,059
|
1,776
|
The
following table provides information about trade receivables and
contract liabilities from contracts with customers. There were no
contract assets at either 30 June 2024 or 31 December
2023.
|
|
30 June
2024
|
30 June
2023
|
31
December
2023
|
|
|
£'000
|
£'000
|
£'000
|
|
Trade receivables which are in
'Trade and other receivables'
|
298
|
440
|
177
|
|
Contract liabilities
|
(46)
|
(48)
|
(44)
|
The following aggregated amounts of
transaction prices relate to the performance obligations from
existing contracts that are unsatisfied or partially unsatisfied as
at 30 June 2024:
|
|
2024
|
2025
|
2026
|
2027
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Revenue expected to be
recognised
|
23
|
14
|
2
|
7
|
46
|
5.
Segmental analysis
Assessment of performance and the
allocation of resources are made on the basis of results derived
from the sale of probes, monitors and other products analysed by
territory, of which revenues and gross margins are regularly
reported to the Group's Chief Executive Officer, who has been
identified as the Chief Operating Decision Maker (CODM). The CODM
also monitors a profit measure described internally as 'adjusted
earnings before interest, tax, depreciation and amortisation,
share-based payments, non-executive directors' fees, as well as any
exceptional items' (Adjusted EBITDA). However, this measure is
reported at a Group level rather than an operating segment which is
based on the nature of the goods provided rather than the
geographical market in which they are sold.
The unaudited operating segment
results for the six months ended 30 June 2024 are:
|
|
Probes1
|
Monitors
|
Other
|
Unallocated
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Revenues
|
824
|
183
|
57
|
-
|
1,064
|
|
Adjusted gross profit2
|
548
|
138
|
41
|
-
|
727
|
|
|
|
|
|
|
|
|
Sales and marketing costs
|
-
|
-
|
-
|
(259)
|
(259)
|
|
Administration costs
|
-
|
-
|
-
|
(533)
|
(533)
|
|
R&D costs
|
-
|
-
|
-
|
(137)
|
(137)
|
|
Quality and regulation costs
|
-
|
-
|
-
|
(72)
|
(72)
|
|
Adjusted EBITDA
|
-
|
-
|
-
|
-
|
(274)
|
1. Managed care
service revenue is categorised as probe revenue
2. Gross profit
excluding the depreciation charge relating to monitors loaned to
customers and production equipment (£14,000)
The unaudited operating segment
results for the six months ended 30 June 2023 were:
|
|
Probes1
|
Monitors
|
Other
|
Unallocated
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Revenues
|
815
|
201
|
43
|
-
|
1,059
|
|
Adjusted gross
profit2
|
572
|
145
|
21
|
-
|
738
|
|
|
|
|
|
|
|
|
Sales and marketing costs
|
-
|
-
|
-
|
(425)
|
(425)
|
|
Administration costs
|
-
|
-
|
-
|
(587)
|
(587)
|
|
R&D costs
|
-
|
-
|
-
|
(1)
|
(1)
|
|
Quality and regulation
costs
|
-
|
-
|
-
|
(86)
|
(86)
|
|
Adjusted EBITDA
|
-
|
-
|
-
|
-
|
(361)
|
1. Managed care
service revenue is categorised as probe revenue
2. Gross profit
excluding the depreciation charge relating to monitors loaned to
customers and production equipment (£10,000)
The audited operating segment
results for the year ended 31 December 2023 were:
|
|
Probes1
|
Monitors
|
Other
|
Unallocated
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Revenues
|
1,425
|
258
|
93
|
-
|
1,776
|
|
Adjusted gross
profit2
|
928
|
165
|
36
|
(101)
|
1,028
|
|
|
|
|
|
|
|
|
Sales and marketing costs
|
-
|
-
|
-
|
(782)
|
(782)
|
|
Administration costs
|
-
|
-
|
-
|
(905)
|
(905)
|
|
R&D costs
|
-
|
-
|
-
|
(14)
|
(14)
|
|
Quality and regulation
costs
|
-
|
-
|
-
|
(187)
|
(187)
|
|
Adjusted EBITDA
|
-
|
-
|
-
|
-
|
(860)
|
1. Managed care
service revenue is categorised as probe revenue
2. Gross profit
excluding the depreciation charge relating to monitors loaned to
customers and production equipment (£4,000) and including
exceptional items (£101,000)
The reconciliation of the profit
measure used by the Group's CODM to the result reported in the
Group's consolidated SOCI is set out below:
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
£'000
|
30
June
2023
£'000
|
31
December
2023
£'000
|
|
Adjusted EBITDA
|
(274)
|
(361)
|
(860)
|
|
Non-cash items:
|
|
|
|
|
Depreciation of property, plant and
equipment
|
(39)
|
(38)
|
(110)
|
|
Amortisation of development
costs
|
(84)
|
(20)
|
(23)
|
|
Non-executive directors' fees and
employer's NIC
|
(31)
|
(71)
|
(91)
|
|
Gain on convertible loan
note
|
-
|
89
|
89
|
|
Write off of research and
development projects not taken forward
|
-
|
-
|
(141)
|
|
Share-based payment
expense
|
(3)
|
(32)
|
-
|
|
Change in accumulated absence cost
liability
|
(11)
|
(24)
|
1
|
|
Cash item: Other tax
income
|
-
|
40
|
83
|
|
|
(168)
|
(56)
|
(192)
|
|
Operating loss
|
(442)
|
(417)
|
(1,052)
|
|
Finance costs
|
(104)
|
(119)
|
(230)
|
|
Loss before tax
|
(546)
|
(536)
|
(1,282)
|
|
Tax credit on loss
|
-
|
(1)
|
-
|
|
Loss for the period/year
|
(546)
|
(537)
|
(1,282)
|
6.
Cash-adjusted overheads and
capitalised development costs
In
November 2023, the Group's new monitor development project, the
TrueVue monitor, became available for sale and consequently
amortisation of the capitalised costs for that project commenced
from that date. Expenditure incurred in periods up until November
2023, in respect of the development of the new monitor, has been
capitalised whereas expenditure incurred after November 2023 on
this project is charged to the Consolidated SOCI in the period in
which it is incurred. Development costs capitalised for the six
months to 30 June 2024 were £11,000 (six months to 30 June 2023:
£435,000). The Group reviews the cash-adjusted
overhead as part of its monthly financial review at a Group
level.
A reconciliation between overheads in the
Consolidated SOCI and cash-adjusted overheads is shown
below:
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
£'000
|
30
June
2023
£'000
|
31
December
2023
£'000
|
|
Total overhead costs excluding
exceptional costs
|
(1,153)
|
(1,185)
|
(1,983)
|
|
|
|
|
|
|
Capitalised development
expenditure
|
(11)
|
(435)
|
(627)
|
|
Non-cash items:
|
|
|
|
|
Depreciation of property, plant and
equipment
|
39
|
38
|
110
|
|
Amortisation of development
costs
|
84
|
20
|
23
|
|
Non-executive directors' fees and
employer's NIC
|
31
|
71
|
91
|
|
Gain on convertible loan
note
|
-
|
(89)
|
(89)
|
|
Share-based payment
expense
|
3
|
32
|
-
|
|
Change in accumulated absence cost
liability
|
11
|
24
|
(1)
|
|
|
157
|
(339)
|
(493)
|
|
Cash-adjusted overheads
|
(996)
|
(1,524)
|
(2,476)
|
7.
Dividends
The Directors cannot recommend the
payment of a dividend for 2024 (2023: nil).
8.
Tax credit on loss
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
|
30
June
2023
|
31
December
2023
|
|
|
£'000
|
£'000
|
£'000
|
|
Research and development tax credit
adjustment
|
-
|
1
|
(1)
|
|
Adjustment in respect of prior
years
|
-
|
-
|
1
|
|
Total current tax
|
-
|
-
|
-
|
|
Total deferred tax
|
-
|
-
|
-
|
|
Total tax credit
adjustment
|
-
|
1
|
-
|
There was no other gain amount for
the six months to 30 June 2024 (six months to 30 June 2023:
£40,000). This comprises tax income arising from the Research and
Development Expenditure Credit scheme which is accounted for as a
government grant.
9.
Exceptional items
As
permitted by IAS1, 'Presentation of Financial Statements', certain
items are presented separately in the Consolidated SOCI as
exceptional items where, in the judgement of the directors, they
need to be presented separately by virtue of their nature, size or
incidence to obtain a clear and consistent presentation of the
Group's underlying business performance.
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
£'000
|
30
June
2023
£'000
|
31
December
2023
£'000
|
|
Payments in lieu of
notice
|
-
|
-
|
107
|
|
Redundancy costs
|
-
|
-
|
98
|
|
Legal and professional costs
relating to redundancies
|
-
|
-
|
19
|
|
Write off of research and
development projects not taken forward
|
-
|
-
|
142
|
|
|
-
|
-
|
366
|
10. Loss per
share
Basic loss per share is
calculated by dividing the earnings attributable to ordinary
shareholders by the weighted average number of ordinary shares
issued during the year.
The loss per share calculation for six months to
30 June 2024 is based on the loss of £545,000 and the weighted
average number of shares in issue of 1,891,934,069.
For the six months to
30 June 2023, the loss per share calculation is based on the loss
of £538,000 and the weighted average number of shares in issue of
703,227,881.
For the year ended 31 December 2023, the loss per share
calculation is based on the loss of £1,257,000 and the weighted
average number of shares in issue of 1,181,214,755.
While the Group is loss-making, the
diluted loss per share and the loss per share are the
same.
11.
Inventories
Inventories at 30 June 2024 include
the following finished Goods: 8,709 probes (30 June 2023: 16,800)
and 100 monitors (30 June 2023: 113).
12. Cash at
bank
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
|
30
June
2023
|
31
December
2023
|
|
|
£'000
|
£'000
|
£'000
|
|
Cash at bank
|
326
|
107
|
705
|
13. Borrowings
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
|
30 June
2023
|
31
December 2023
|
|
|
Current
|
Non-current
|
Current
|
Non-current
|
Current
|
Non-current
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Invoice discount facility
|
151
|
-
|
147
|
-
|
79
|
-
|
|
Standby loan facility
|
650
|
-
|
750
|
-
|
-
|
650
|
|
Bridging loan facility
|
-
|
-
|
250
|
-
|
-
|
-
|
|
Convertible loan note
|
-
|
1,034
|
-
|
998
|
-
|
1,015
|
|
|
801
|
1,034
|
1,147
|
998
|
79
|
1,665
|
14. Trade and other
payables
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
|
30 June
2023
|
31
December 2023
|
|
|
Current
|
Non-current
|
Current
|
Non-current
|
Current
|
Non-current
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Trade payables
|
193
|
-
|
600
|
-
|
173
|
-
|
|
Other payables
|
82
|
-
|
90
|
-
|
89
|
-
|
|
Social security and other
taxes
|
97
|
-
|
145
|
-
|
94
|
-
|
|
Lease obligations
|
61
|
87
|
55
|
148
|
58
|
119
|
|
Contract liabilities
|
46
|
-
|
48
|
-
|
44
|
-
|
|
Employee short-term
benefits
|
34
|
-
|
48
|
-
|
23
|
-
|
|
Accrued expenses
|
301
|
-
|
599
|
-
|
374
|
-
|
|
|
814
|
87
|
1,585
|
148
|
855
|
119
|
In the prior year, a non-current
other receivable was recognised of £159,000. The amount outstanding
related to a trade receivable due from the non-controlling interest
in the Group's Canadian subsidiary. Within trade and other payables
in the prior year, was an amount of £249,000, payable to the
non-controlling interest in the Group's Canadian subsidiary. These
balances have been offset in the interim financial statements, with
the prior year balances being restated as a net payable of £90,000.
The offset balance as at 30 June 2024 is a net payable of
£82,000.
15. Convertible loan
note
The convertible loan note recognised
in the Condensed Consolidated Balance Sheet is calculated
as:
|
|
Financial
liability
|
Equity
component
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
|
Carrying amount at 1 January
2024
|
1,015
|
82
|
1,097
|
|
Interest expense
|
63
|
-
|
63
|
|
Interest paid
|
(44)
|
-
|
(44)
|
|
Carrying amount at 30 June 2024
|
1,034
|
82
|
1,116
|
The convertible loan note falls due
for repayment in June 2026. The convertible loan note is, at the
option of the loan note holder, convertible at any time into new
ordinary shares of 1 penny each at a conversion price of 4 pence
per share.
16. Share
capital
In January 2024, 49,372,352 new
ordinary shares of 1 pence each were issued at a price of 0.17
pence per ordinary share to satisfy certain current and former
non-executive directors' fees for the year ended 31 December
2023.
There were no share options
exercised during the six months ended 30 June 2024 or the six
months ended 30 June 2023.
17. Seasonal
fluctuations
Revenues in our Distributor markets
are traditionally higher in the second half of the financial year
due to the purchasing patterns of customers.
18. Foreign exchange
rates
The following are the principal
foreign exchange rates that have been used in the preparation of
the condensed consolidated interim financial statements:
|
|
Unaudited
|
Audited
|
|
|
30 June
2024
|
30 June
2023
|
31
December 2023
|
|
|
Average
rate
|
Closing
rate
|
Average
rate
|
Closing
rate
|
Average
rate
|
Closing
rate
|
|
Sterling/US dollar
|
1.27
|
1.26
|
1.23
|
1.27
|
1.24
|
1.27
|
|
Sterling/Euro
|
1.17
|
1.18
|
1.14
|
1.16
|
1.15
|
1.15
|
|
Sterling/Canadian dollar
|
1.72
|
1.73
|
1.67
|
1.68
|
1.68
|
1.69
|
19. Distribution of the
announcement
Copies of this announcement are sent
to shareholders on request and will be available for collection
free of charge from the Group's registered office at Terminus Road,
Chichester, PO19 8TX, United Kingdom. This announcement is
available, free of charge, from the Group's website at
www.deltexmedical.com
20. Cautionary
statement
This announcement contains
forward-looking statements which are made in good faith based on
the information available at the time of its approval. It is
believed that the expectations reflected in these statements are
reasonable, but they may be affected by several risks and
uncertainties that are inherent in any forward-looking statement
which could cause actual results to differ materially from those
currently anticipated. Nothing in this document should be
considered to be a profit forecast.