TIDMRAI
RNS Number : 2488B
RA International Group PLC
30 September 2022
This announcement contains inside information
RA INTERNATIONAL GROUP PLC
("RA International" or the "Company")
Interim Results for the six months to 30 June 2022
RA International Group plc (AIM: RAI), a specialist provider of
complex and integrated remote site services to organisations
globally , is pleased to announce its interim results for the six
months ended 30 June 2022.
HIGHLIGHTS
-- Revenue of USD 29.2m (H2 21: USD 28.4m, H1 21: USD 26.2m) and
underlying EBITDA of USD nil (H2 21: USD 1.6m, H1 21: USD 5.0m), in
line with external expectations for the period ended 30 June
2022
-- Positive run rate of new contract wins for the year to date
with USD 35m awarded in the year to August 2022 compared with USD
40m for the full 12 months of 2021
-- Order book of USD 95m as at 31 August 2022 (H2 21: USD 100m,
H1 21: USD 129m) provides good forward visibility despite the
continued low level of tendering of larger, long-term contracts in
the humanitarian sector
-- The new contract award with the UK Ministry of Defence,
announced separately today, demonstrates good progress in deepening
our relationships with western governments. This is a global
framework agreement, with a base term of 5 years and a contract
value of up to GBP 35m (not included in current order book)
-- USD 12.0m debt financing completed in May 2022 supports our
liquidity position to fund existing and visible project
activity
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
USD'm USD'm USD'm
Revenue 29.2 28.4 26.2
Gross profit 3.0 4.4 7.7
Gross profit margin 10.3% 15.4% 29.2%
Underlying EBITDA(1) - 1.6 5.0
Underlying EBITDA margin (0.2%) 5.7% 19.2%
(Loss)/Profit before tax (3.4) (33.0) 0.8
(Loss)/Profit before tax margin (11.7%) (116.7%) 3.8%
Basic EPS (cents) (2.0) (19.3) 0.6
Net (debt)/cash (end of period)
(2) (4.3) (1.5) 3.6
Soraya Narfeldt, CEO of RA International, commented:
"We are making good progress in securing high quality overseas
work with the relevant departments of the UK and US Governments, in
line with our refreshed strategy. We see this as a significant
opportunity given the scale of these addressable markets and
believe, over time, RA International will be increasingly well
positioned as a differentiated provider of specialist services to
government clients, complementing our work with humanitarian
organisations and the international development community. Our
pipeline activity is healthy and growing within the areas we are
targeting, however the timing of contract awards and project starts
remains uncertain. We are not immune to the macro and general
inflationary environment and this informs our cautious view on our
nearer-term financial performance, particularly on margin. We are
mitigating these pressures where we can through commercial
arrangements and other supply chain initiatives and remain focused
on converting our robust pipeline to support the attractive growth
opportunity we have ahead."
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 debt/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) +44 (0) 207 523
Bobbie Hilliam 8000
Bamburgh Capital Limited (Financial PR & Investor +44 (0)131 376
Relations) 0901
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 two main client groups: humanitarian and development
agencies and western government organisations focusing on overseas
projects. It has a strong customer base, largely comprising UN
agencies, UK and US Government departments 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
We are making good progress in executing on our priorities
As we outlined to investors in our last results statement in
late May 2022, we have a significant opportunity to grow by
deepening and strengthening our relationships with the relevant
departments of the US and UK Governments. We are doing this from a
position of some strength with an established platform as a trusted
partner which has seen government sector revenues grow from 6% of
our revenue in 2014 to 47% by 2021. We are strengthening our market
position as a differentiated and specialist remote site service
provider to these clients by aligning our resources more clearly
with our business development activities in this sector and through
building our track record in delivering projects as a prime
contractor. This complements our long-term relationships with
humanitarian agencies, and we are excited about the opportunity we
have to scale the Company significantly through our differentiated
and integrated offering supporting clients across these sectors. We
also believe the fragmented market environment plays to our
strengths: where international companies' use of local companies
leads to project inefficiencies; where our track record and past
performance is second to none; and where our one-supplier model
gives us a clear cost advantage.
We are pleased with the progress we have made in the period in
scaling our relationships with relevant UK and US Government
departments. Through RA Federal Services, LLC ("RA Federal") our US
subsidiary, we now have the US credentials to deliver full scale
capability to the relevant US Federal Government budget holders as
a prime contractor. RA Federal is now operational and is delivering
contracts on behalf of the US Government as a prime contractor. We
will continue to invest in our US capability to spearhead further
growth in this significant market.
On the UK side, we have today announced the award of a contract
to provide operational support capability to the UK Ministry of
Defence as lead contractor. This is a significant award for RA
International and will lead to the Company working closely with
British military operational headquarters, the Permanent Joint
Headquarters (PJHQ), for the next five years, with an option to
extend for a further two years. The win is testament to our
capability to deliver operational support to the British military
across the world; providing our expertise in project management,
engineering, supply chain management, logistics and project
delivery to support military planning, operations and training. The
contract is structured as a global framework agreement, with a
contract ceiling of GBP 35 million which will be drawn down as
tasks are issued. The contract start date is effective from 1
December 2022 and we will be increasing the size of our UK
operations to help facilitate and oversee the delivery of this
contract.
In previous updates we have highlighted the opportunity we have
to develop valuable partnerships and how this continues to be
central to our business development activities. We remain active in
delivering projects for a number of large US defence contractors
and are in active discussions with other companies which could
provide significant global opportunities. At the right time, we
also see the opportunity for organic growth to be accelerated by
bolt-on M&A further strengthening our position in underserved
markets.
Our financial performance is in-line with external expectations
and reflects the prevailing environment
As we look to grow in-line with our strategy, we are also
focusing on the near-term performance and overall stability of the
business. The financial performance we are reporting for the first
half is in-line with external expectations. It does also highlight
how the operating environment and inflation are putting pressure on
gross margin across our Integrated Facilities Management ("IFM")
and Construction sectors, as outlined in Andrew's Financial
Review.
We have taken steps to strengthen our liquidity position, with
our loan note programme refinanced out to late 2024, and are
confident we have the financial capacity to bid for and mobilise
multiple large projects simultaneously. In addition, we are
recovering value on the Mozambique related assets we impaired in
FY21 and these results highlight the low level of capex which is
required when we are not constructing camp facilities where
ownership will be retained by the Group.
Our order book of USD 95m as at 31 August 2022 provides good
forward visibility
We were awarded new contracts, uplifts, and extensions to
existing contracts of USD 35m in the first eight months of
2022.
Contract order book:
USD'm
Opening order book as at 1 January
2022 100
New contracts, uplifts and extensions 35
Contracted revenue delivered (40)
----------------
Closing order book as at 31 August
2022 95
We have maintained the order book at or around USD 100m at a
time when the level of market activity has been subdued. The nature
of project tendering in the humanitarian sector is a good example
of this. We conservatively estimate there are at least USD 50m of
contracts which under normal conditions would be awarded in the
next three months, and which we would expect to have a reasonable
chance of winning. This said, under current conditions, the
timeline of award is very uncertain with the default position
remaining contract extensions rather than new awards. If we look
back to our contract awards in a pre-Covid environment, in 2019, we
announced three humanitarian contracts with a combined value of USD
28m. These are the types of new contracts which have not been
awarded over the last two and a half years, constraining our order
book momentum. In this context, we see the higher run-rate of
contract wins of USD 35m in the year to August 2022 compared with
the USD 40m for the full 12 months of 2021 as encouraging.
IFM projects represent 53% of order book, with construction 42%
and supply chain 5%. New contract activity has been weighted to
construction projects with many expected to be the first phase of
much larger contracts.
Overall, we are committed to building a high-quality and
de-risked pipeline through developing our relationships with
western government and humanitarian clients, either as prime
contractor or through a partnership approach where it makes more
commercial sense. Going forward, we see scope for accelerated
contract awards through our targeted business development and as
and when the humanitarian sector returns to more normal tendering
patterns.
Summary and outlook
We are making good progress in securing high quality overseas
work with the relevant departments of the UK and US Governments, in
line with our refreshed strategy. We see this as a significant
opportunity given the scale of these addressable markets and
believe, over time, RA International will be increasingly well
positioned as a differentiated provider of specialist services to
government clients, complementing our work with humanitarian
organisations and the international development community. Our
pipeline activity is healthy and growing within the areas we are
targeting, however the timing of contract awards and project starts
remains uncertain. We are not immune to the macro and general
inflationary environment and this informs our cautious view on our
nearer-term financial performance, particularly on margin. We are
mitigating these pressures where we can through commercial
arrangements and other supply chain initiatives and remain focused
on converting our robust pipeline to support the attractive growth
opportunity we have ahead.
Soraya Narfeldt
Chief Executive Officer
30 September 2022
FINANCIAL REVIEW
Overview
Revenue of USD 29.2m and underlying EBITDA of USD nil are in
line with external expectations and reflect the prevailing market
environment where the level and nature of project activity has not
yet returned to pre-Covid norms. The impact of this disruption,
inflationary pressure and related issues such as material shortages
are clearly impacting gross margin rather than revenue, which has
been fairly consistent with comparative periods. Administrative
expenses have reduced by USD 0.2m since H2 21, reflecting our
efforts to streamline the cost base of the business as we
reallocate resources to, and invest in, our growth priorities.
We completed a USD 12.0m debt financing in the first half of the
year, with the maturity of existing notes being extended to the
fourth quarter of 2024 and additional liquidity raised of USD 3.6m.
We are also making progress in recovering value for our assets
which were fully impaired and relate to the Palma, Mozambique
operations. In H1 22, USD 1.2m of impairment was reversed resulting
from the sale of Palma Project assets. Besides generating a profit
and an impairment recovery this transaction will significantly
reduce future storage costs. Overall, the Company remains in a
strong position to bid for and execute large projects and
significant opportunities remain to increase liquidity through
further asset sales.
Cash outflows from operations decreased from prior periods to
USD 1.2m in H1 22 (H2 21: USD 1.4m, H1 21: USD 3.4m). Excluding the
USD 1.6m in cash outflows relating to the storage of Palma related
assets and the prefabricated camp facility, operating cashflows
were positive. We continue to actively pursue opportunities to
enhance our liquidity position through disposing of these assets
and, in turn, reducing the ongoing holding costs to the
business.
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
USD'm USD'm USD'm
Revenue 29.2 28.4 26.2
Gross profit 3.0 4.4 7.7
Gross profit margin 10.3% 15.4% 29.2%
Underlying EBITDA - 1.6 5.0
Underlying EBITDA margin (0.2%) 5.7% 19.2%
(Loss)/Profit before tax (3.4) (33.0) 0.8
(Loss)/Profit before tax margin (11.7%) (116.7%) 3.8%
Basic EPS (cents) (2.0) (19.3) 0.6
Net (debt)/cash (end of period) (4.3) (1.5) 3.6
Revenue
Reported revenue for H1 22 of USD 29.2m (H2 21: USD 28.4m, H1
21: USD 26.2m) is relatively consistent with the comparative
periods, as increased Supply Chain revenue more than offset lower
Construction and IFM contributions.
The majority of our Supply Chain revenue is typically earned
from long-term contracts, often three to five years in length,
although revenue for this period was bolstered by a USD 2.3m sale
of Palma Project assets, as well as USD 2.2m in sales relating to
parcels of the prefabricated camp facility held in Turkey.
Excluding these asset sales, Supply Chain revenue grew 11.2% period
on period, with IAP expanding our mandate to include a third
country, which is encouraging and indicative of how the
relationship is growing.
Construction revenue of USD 6.4m represents a decrease of USD
1.6m from prior period (H2 21: USD 8.0m, H1 21: USD 6.2m). The
decrease from H2 21 is reflective of significant disruption caused
to some projects by material shortages and the successful
conclusion of a large contract with Cherokee Nation which
strengthened H2 21 revenue and profitability. Overall, Construction
revenue for the period was in-line with H1 21. We expect
Construction revenue to be significantly higher in the second half
of the year as we commence new, recently awarded projects.
IFM revenue of USD 13.3m represents a decrease of USD 2.4m from
prior period (H2 21: USD 15.7m, H1 21: USD 15.4m) and resulted from
lower income from our hotel facility in Somalia. From November
2022, we expect occupancy to meaningfully improve month on month
unless significant travel restrictions are reintroduced. Overall,
IFM revenue continues to be resilient and long-term in nature.
Government revenue continues to increase as a percentage of
total revenue, and we expect the majority of revenue in FY22 to
come from government clients.
Revenue by service channel:
6 months 6 months 6 months
ended ended Ended
30 June 31 December 30 June
2022 2021 2021
USD'm USD'm USD'm
Integrated facilities management 13.3 15.7 15.4
Construction 6.4 8.0 6.2
Supply chain 9.5 4.6 4.6
---------------- ---------------- ----------------
29.2 28.4 26.2
Profit Margin
Gross margin in H1 22 was 10.3% (H2 21: 15.4%, H1 21: 29.2%)
reflecting weaker profit margins across all service channels and a
far higher percentage of total revenue being generated from Supply
Chain and Construction activities than in prior periods (H1 22:
55%, H2 21: 44%, H1 21: 41%).
Challenges highlighted within the 2021 full year results
continued in the current period, specifically the fitful nature of
construction project execution. While material shortages and
inflationary pressure continued to depress margins on legacy
construction projects, margin improvements are anticipated in the
second half of the year as a number of large contracts are
completed and new projects, which were recently priced and awarded,
commence.
As with revenue, low hotel occupancy rates in Somalia negatively
impacted IFM margins in H1 22. Some improvement is anticipated in
H2 22 as more international organisations expand their presence in
the country following the completion of elections earlier this
year. Excluding the sale of Palma Project assets at a low margin
(after taking into account the recovery of impairment), gross
margin generated from Supply Chain activities was relatively
resilient during the period.
Reconciliation of (loss)/profit to Underlying EBITDA:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
USD'm USD'm USD'm
(Loss)/Profit (3.4) (33.1) 1.0
Tax expense - 0.1 (0.2)
---------------- ---------------- ----------------
(Loss)/Profit before tax (3.4) (33.0) 0.8
Finance costs 1.4 0.8 0.6
Investment income (0.1) - -
---------------- ---------------- ----------------
Operating (loss)/profit (2.1) (32.3) 1.4
Non-underlying items (0.4) 31.0 1.2
---------------- ---------------- ----------------
Underlying operating (loss)/profit (2.5) (1.3) 2.6
Share based payments 0.2 0.2 0.3
Depreciation 2.3 2.7 2.1
---------------- ---------------- ----------------
Underlying EBITDA - 1.6 5.0
Underlying EBITDA margin in H1 22 was negative 0.2% (H2 21:
5.7%, H1 21: 19.2%) , with the negative variance from prior periods
reflecting the weakening in project margins. Administrative
expenses decreased by USD 0.2m from H2 21, reflecting efforts made
to streamline the support functions of the Group, ensuring
resources are aligned more fully with the Company's focus on
government and humanitarian work.
Non-underlying items
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
USD'm USD'm USD'm
COVID-19 costs - 0.3 0.4
Restructuring costs 0.8 - -
Asset impairment (1.2) 30.6 0.8
---------------- ---------------- ----------------
(0.4) 31.0 1.2
Restructuring costs result from the strategic decision to
redirect resources and investment towards growing our government
and humanitarian client bases, and away from actively selling to
commercial customers. The specific costs associated with the
restructuring exercise can be broadly classified as relating to
staff redundancies and the write-off of past investments which were
to be recovered through contracts with commercial customers.
As indicated previously, USD 1.2m of impairment was reversed in
H1 22 resulting from the sale of Palma Project assets. In addition
to this recovery of value, we have also significantly reduced the
total storage costs moving forward. We are in discussions with
parties interested in acquiring further parcels of assets which may
lead to a further recovery of value and eliminate asset storage
costs other than those being paid to safeguard machinery and heavy
equipment in Northern Mozambique.
Earnings Per Share
Basic earnings per share was negative 2.0 cents in the current
period (H2 21: negative 19.3 cents, H1 21: 0.6 cents) and is equal
to diluted earnings per share for the current period.
Cashflow
Cash of USD 9.2m at 30 June 2022 reflects a modest increase of
USD 0.7m from 2021 year end and results from an increase in loan
notes issued, offset by finance cost and storage expenses incurred
and paid during H1 22.
Cash outflows from operations decreased from prior periods to
USD 1.2m in H1 22 (H2 21: USD 1.4, H1 21: USD 3.4m). Excluding the
USD 1.6m in cash outflows relating to the storage of Palma related
assets and the prefabricated camp facility, operating cashflows
were positive. We have been successful in selling goods which were
incurring significant storage costs and we are actively pursuing
opportunities to minimize the remaining ongoing charges as well as
recover value from the underlying assets.
When we released our full year FY21 results we anticipated FY22
capital expenditure (capex) to be between USD 1.0m and USD 2.0m.
During the Period we incurred capex of USD 0.3m (H2 21: USD 0.2m,
H1 21: USD 3.3m) ; considering projects commencing in the second
half of the year, we now anticipate full year expenditure to be
towards the lower end of this range.
Balance Sheet and Liquidity
Net assets at 30 June 2022 were USD 34.1m (H2 21: USD 37.3m, H1
21: USD 70.2m), decreasing from 2021 year end in line with the net
loss generated in the Period.
Breakup of net assets:
As at As at As at
30 June 31 December 30 June
2022 2021 2021
USD'm USD'm USD'm
Cash and cash equivalents 9.2 8.5 10.1
Loan notes (13.5) (10.0) (6.5)
---------------- ---------------- ----------------
Net (debt)/cash (4.3) (1.5) 3.6
Net working capital 16.3 14.7 18.8
Non-current assets 28.7 30.9 54.5
Tangible owned assets 23.8 25.5 48.6
Right-to-use assets 4.9 5.4 5.8
Goodwill - - 0.1
Lease liabilities and end of
service benefit (6.5) (6.8) (6.8)
---------------- ---------------- ----------------
Net assets 34.1 37.3 70.2
Given the events taking place last year in Palma, Mozambique and
the effect on the Company's balance sheet, a focus point for 2022
was improving the Company's liquidity profile. In H1 22 we made
significant progress through completing a refinancing and
fundraising exercise to synchronise and extend the maturity of the
loan notes issued under the Medium-Term Note ("MTN") programme. The
USD 12.0m of loan notes issued mature in November 2024 and we have
commenced the repayment of the USD 1.5m of loan notes maturing in
H2 22. Largely a result of this fundraising exercise, the Company's
current ratio increased to 2.9 at 30 June 2022 from 1.6 as at 31
December 2021.
In addition to the MTN programme, during the Period we
established a GBP 10m long-term debt facility and in July 2022 we
agreed a USD 3.5m working capital facility with one of our primary
banks. While we have adequate cash to fund current and planned
operations, we felt it diligent to establish additional available
sources of capital as we enter the next growth phase of the
business.
In addition to fundraising activities we made further progress
reducing the level of inventory. This will remain a focus point
during this year. At the end of June 2022 inventory had decreased
to USD 8.6m (H2 21: USD 9.4m, H1 21: USD 13.3m).
Trade and other receivables increased to USD 17.3m at the end of
the current period (H2 21: USD 16.5m, H1 21: USD 14.2m). The USD
0.8m variance was due to a USD 2.9m receivable balance relating to
the Palma Project and prefabricated camp asset sales as well as the
Company continuing to experience a slow collection cycle with
humanitarian customers.
Dividend
The Company has typically not paid a dividend with respect to
the first half interim results and no dividend has been declared
for the first half of 2022. The Board did not recommend the payment
of a final dividend for FY21 in line with its cautious approach to
the prevailing environment. The Board's intention is to reinstate
the dividend as soon as is practical.
Shares in Issue and Treasury Shares
In the First Half, 324,462 ordinary shares were transferred out
of treasury in settlement of certain employee share options. As at
30 June 2022, the total number of ordinary shares in issue and
admitted to trading on AIM was 173,575,741, comprising 1,459,435
ordinary shares held in treasury and 172,116,306 ordinary shares
with voting rights.
In July 2022, the remaining 1,459,435 of ordinary shares held in
treasury were issued. As a result, ordinary shares with voting
rights in issue total 173,575,741.
Andrew Bolter
Chief Financial Officer
30 September 2022
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 June 2022
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
Notes USD'000 USD'000 USD'000
Revenue 29,188 28,355 26,240
Direct costs (26,176) (23,470) (18,580)
Credit provision - (505) -
---------------- ---------------- ----------------
Gross profit 3,012 4,380 7,660
Administrative expenses (5,514) (5,677) (5,042)
---------------- ---------------- ----------------
Underlying operating (loss)/profit (2,502) (1,297) 2,618
Non-underlying items 4 444 (30,979) (1,243)
---------------- ---------------- ----------------
Operating (loss)/profit (2,058) (32,276) 1,375
Investment revenue 56 33 22
Finance costs (1,419) (754) (560)
---------------- ---------------- ----------------
(Loss)/Profit before tax (3,421) (32,997) 837
Tax expense - (84) 164
---------------- ---------------- ----------------
(Loss)/Profit and total comprehensive
income for the period (3,421) (33,081) 1,001
Basic earnings per share (cents) 5 (2.0) (19.3) 0.6
Diluted earnings per share (cents) 5 (2.0) (19.1) 0.6
CONDESED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2022
As at As at As at
30 June 31 December 30 June
2022 2021 2021
Notes USD'000 USD'000 USD'000
Assets
Non-current assets
Property, plant, and equipment 23,803 25,512 48,555
Right-of-use assets 4,904 5,374 5,810
Goodwill - - 138
---------------- ---------------- ----------------
28,707 30,886 54,503
---------------- ---------------- ----------------
Current assets
Inventories 8,638 9,397 13,267
Trade and other receivables 17,298 16,522 14,201
Cash and cash equivalents 9,174 8,532 10,102
---------------- ---------------- ----------------
35,110 34,451 37,570
---------------- ---------------- ----------------
Total assets 63,817 65,337 92,073
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 (981) (1,199) (1,257)
Share based payment reserve 448 534 383
Retained earnings 9,896 13,223 46,304
---------------- ---------------- ----------------
Total equity 34,114 37,309 70,181
---------------- ---------------- ----------------
Non-current liabilities
Loan notes 12,000 - 6,471
Lease liabilities 4,825 5,206 5,698
Employees' end of service benefits 817 731 562
---------------- ---------------- ----------------
17,642 5,937 12,731
---------------- ---------------- ----------------
Current liabilities
Loan notes 1,502 10,000 -
Lease liabilities 896 834 502
Trade and other payables 8,931 9,835 8,659
Provisions 732 1,422 -
---------------- ---------------- ----------------
12,061 22,091 9,161
---------------- ---------------- ----------------
Total liabilities 29,703 28,028 21,892
---------------- ---------------- ----------------
Total equity and liabilities 63,817 65,337 92,073
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2022
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 2021 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
Total
comprehensive
income
for the
period - - - - - (33,081) (33,081)
Share based
payments - - - - 199 - 199
Issuance of
treasury
shares - - - 58 (48) - 10
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
As at 31
December 2021 24,300 18,254 (17,803) (1,199) 534 13,223 37,309
Total
comprehensive
income
for the
period - - - - - (3,421) (3,421)
Share based
payments - - - - 185 - 185
Lapsed share
options - - - - (94) 94 -
Issuance of
treasury
shares - - - 218 (177) - 41
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
As at 30 June
2022 24,300 18,254 (17,803) (981) 448 9,896 34,114
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 30 June 2022
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
Notes USD'000 USD'000 USD'000
Operating activities
Operating (loss)/profit (2,058) (32,276) 1,375
Adjustments for non-cash and other items:
Depreciation on property, plant, and equipment 2,271 2,728 2,127
(Profit)/loss on disposal of property, plant, and
equipment (20) (67) 51
Unrealised differences on translation of foreign
balances (57) 118 15
Provision for employees' end of service benefits 257 225 208
Share based payments 185 199 288
Non-underlying items 4 627 27,218 817
---------------- ---------------- ----------------
1,205 (1,855) 4,881
Working capital adjustments:
Inventories 487 (428) (4,643)
Accounts receivable, deposits, and other
receivables (1,139) (2,363) (1,921)
Accounts payable and accruals (1,814) 3,244 (1,731)
---------------- ---------------- ----------------
Cash flows used in operations (1,261) (1,402) (3,414)
Tax paid - (4) (16)
Employees' end of service benefits paid (142) (56) (163)
---------------- ---------------- ----------------
Net cash flows used in operating activities (1,403) (1,462) (3,593)
---------------- ---------------- ----------------
Investing activities
Investment revenue received 56 33 22
Purchase of property, plant, and equipment (250) (191) (3,287)
Proceeds from disposal of property, plant, and
equipment 187 788 35
---------------- ---------------- ----------------
Net cash flows (used in)/from investing activities (7) 630 (3,230)
---------------- ---------------- ----------------
Financing activities
Proceeds from borrowings 3,502 3,529 387
Payment of lease liabilities (319) (199) (543)
Finance costs paid (1,229) (754) (560)
Dividends paid 6 - (3,206) -
Proceeds from share options exercised 41 10 24
---------------- ---------------- ----------------
Net cash flows from/(used in) financing activities 1,995 (620) (692)
---------------- ---------------- ----------------
Net increase/(decrease) in cash and cash
equivalents 585 (1,452) (7,515)
Cash and cash equivalents as at start of the
period 8,532 10,102 17,632
Effect of foreign exchange on cash and cash
equivalents 57 (118) (15)
---------------- ---------------- ----------------
Cash and cash equivalents as at end of the period 9,174 8,532 10,102
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANICAL
STATEMENTS
For the six months ended 30 June 2022
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 2022 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 2021.
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 2021. The same accounting
policies and methods of computation will be used to prepare the
Annual Report for the year ending 31 December 2022. 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
2022 2021 2021
USD'000 USD'000 USD'000
Integrated facilities management 13,257 15,747 15,415
Construction 6,415 8,034 6,187
Supply chain 9,516 4,574 4,638
---------------- ---------------- ----------------
29,188 28,355 26,240
Revenue by recognition timing:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
USD'000 USD'000 USD'000
Revenue recognised over time 18,919 22,002 19,318
Revenue recognised at a point
in time 10,269 6,353 6,922
---------------- ---------------- ----------------
29,188 28,355 26,240
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
2022 2021 2021
USD'000 USD'000 USD'000
Africa 27,879 26,930 25,427
Other 1,309 1,425 813
---------------- ---------------- ----------------
29,188 28,355 26,240
Non-current assets by geographic area:
As at As at As at
30 June 31 December 30 June
2022 2021 2021
USD'000 USD'000 USD'000
Africa 26,489 28,448 51,249
Other 2,218 2,438 3,254
---------------- ---------------- ----------------
28,707 30,886 54,503
Revenue split by customer:
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
% % %
Customer A 20 22 29
Customer F 12 11 12
Customer E 11 11 18
Customer I 10 - -
Customer B 9 10 1
Customer D 8 10 10
Customer H 8 8 -
Other 22 28 30
---------------- ---------------- ----------------
100 100 100
4 NON-UNDERLYING ITEMS
6 months 6 months 6 months
ended ended ended
30 June 31 December 30 June
2022 2021 2021
USD'000 USD'000 USD'000
COVID-19 costs - 339 426
Restructuring costs 760 - -
Palma Project, Mozambique (1,204) 30,640 817
---------------- ---------------- ----------------
(444) 30,979 1,243
Restructuring costs
These expenses result from the strategic decision to redirect
resources and investment towards growing our government and
humanitarian business as is described in our 2021 annual
results.
Palma Project, Mozambique
In H1 22, the Group sold fixed assets and inventory which had
previously been fully impaired. As a result, a USD 1,204,000
reversal of impairment has been recorded in the period.
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
2022 2021 2021
(Loss)/Profit for the period (USD'000) (3,421) (33,081) 1,001
Basic weighted average number
of ordinary shares 171,813,566 171,744,052 171,576,465
Effect of employee share options 1,077,434 1,447,842 1,560,394
---------------- ---------------- ----------------
Diluted weighted average number
of shares 172,891,000 173,191,894 173,136,859
Basic earnings per share (cents) (2.0) (19.3) 0.6
Diluted earnings per share (cents) (2.0) (19.1) 0.6
6 DIVIDENDS
During the interim period, no dividend was declared and
authorised (H2 21: nil, H1 21: 1.35 pence (USD 0.02) per share
(171,662,973 shares) totalling GBP 2,317,000 (USD 3,206,000)).
7 APPROVAL OF CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
The condensed consolidated interim financial statements were
approved by the Board of Directors on 30 September 2022.
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END
IR SELFWUEESELU
(END) Dow Jones Newswires
September 30, 2022 02:00 ET (06:00 GMT)
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