TIDMSED
RNS Number : 1233Y
Saietta Group PLC
29 December 2023
29 December 2023
Saietta Group Plc
("Saietta", the "Company" or the "Group")
Unaudited Interim Results for the six months ended 30 September
2023
Saietta Group Plc (AIM: SED), the multi-national business which
designs, engineers and manufactures complete eDrive systems for
electric vehicles, today announces its unaudited interim results,
covering the six-month period ended 30 September 2023 (the
"Period").
Financial Highlights for the Period
-- Group income (including grants) of GBP1.4m compared to GBP1.3m in prior Period
-- Gross profit of GBP0.1m (H1 2022: GBP0.1m) with a gross
margin of 9% (H1 2022: 13%). The decline in gross margin reflects
both the absence of retrofit revenues in H1 2023 and high
manufacturing costs prior to the Group's recent automation of
production.
-- GBP0.2m of gain on disposal of fixed assets in the period,
generated through the restructuring of arrangements with
ConMet.
-- Loss from continuing operations, before tax, of GBP7.9m (H1
2022: GBP9.4m) largely reflecting a lower share option charge.
-- Adjusted EBITDA (1) loss of GBP6.5m (H1 2022 GBP6.3m loss)
-- Net cash at the end of the Period of GBP0.5m
Operational Highlights
-- On 3(rd) April 2023, AYRO Inc. placed an order for 3,000 AFT
eDrives to be supplied from Saietta's Sunderland facility. Orders
commenced shipment in Q2 of the financial year 2023/24.
-- On 1(st) August 2023, Saietta and ConMet agreed a
restructuring of the arrangements to develop an in-wheel motor and
in-wheel generator for the US truck market. The agreement resulted
in a gain on disposal of fixed assets in the period of EUR200k.
-- In September 2023, production commenced in the Delhi factory
facility of Saietta's Indian joint venture, Saietta VNA, producing
AFT (Axial Flux Technology) motors for the OEM (Original Equipment
Manufacturer) customer announced on 27 September 2023, with initial
five year volumes expected to be for a minimum of 40,000 units.
Post-Period end
-- On 13th November the Group announced that its Indian JV,
Saietta VNA, had secured an order for its new RFT (Radial Flux
Technology) eDrive system, from its major OEM customer in India.
This validation of Saietta's proprietary RFT motor opens up the
huge electric 2-wheel market in India. Target volumes indicated by
the client, suggest this initial order will scale to an expected
minimum of 60,000 units over a 5 year period.
-- In December 2023, Saietta announced it had completed a
fundraising of GBP7.14m before expenses. Proceeds of the
fundraising will be used to satisfy the Group's working capital
requirements through to the end of March 2024 and to support growth
of the Company's Indian joint venture, Saietta VNA.
Outlook
-- Saietta and its Indian JV, Saietta VNA, have secured high
volume OEM relationships in India and the US which are set to
utilise the production capacity they have developed in Delhi and
Sunderland. The Group is therefore ready to enter the next stage of
its evolution as a large-scale manufacturer.
David Woolley, Chief Executive of Saietta, said:
"The first half of the 23/24 financial year has been challenging
but Saietta has made significant strides towards its full
transition from an R&D company to a full-scale production
manufacturer.
During the Period, Saietta reached operational readiness in its
joint venture facility in India and successfully commenced
deliveries to its US customer, AYRO Inc. The development of
in-wheel motors and generators for trucks was transferred to
Consolidated Metco Inc. ("ConMet"), resulting in an upfront payment
to Saietta of EUR3.3 million and potential additional future
license payments of up to EUR20m. This allowed the Group to narrow
its focus on the lightweight EV opportunity in India.
Demonstrable evidence of the demand for Saietta's proprietary
eDrives in India has come from an initial AFT order from a global
OEM which is one of the largest producers of light commercial
vehicles in that market.
Post the Period end, the benefits of the Group's focus were
further realised through an additional contract for Saietta VNA,
namely, an order from its lead OEM customer for Saietta's
proprietary, all-new RFT motor, mated to a bespoke Saietta
controller, transmission, axle and vehicle control unit.
Saietta has now raised GBP7.14m of additional funds (before
expenses) in the market which, with tight control over costs, will
meet its working capital needs until the end of March 2024 and
management continue to explore alternative sources of funds to take
the Company through to a cash positive position thereafter.
I am therefore delighted to be at the helm of Saietta as it
enters this exciting phase."
For any further enquiries, please contact:
Saietta Group (email : contact@saietta.com)
Anthony (Tony) Gott, Executive Chairman
David Woolley, Chief Executive Officer
David Wilkinson, Interim Chief Financial
Officer
Canaccord Genuity (Nomad and Broker)
(Tel : +44 (0) 20 7523 8000)
Henry Fitzgerald-O'Connor / Harry Pardoe
(1) Adjusted EBITDA above is a non-IFRS measure and is
calculated as the Group's earnings before interest, tax,
depreciation, amortisation, impairment and extraordinary items
including share-based payment charges, costs related to Saietta
Group Plc's fund-raising, fees in respect of establishing new staff
pension scheme, write-off inventory acquired as part of Sunderland
lease transaction and legal fees in respect of the incorporation of
the equity accounted associate. See note 4 for more details.
About Saietta:
Listed on the London Stock Exchange's AIM, Saietta is a global
business that designs, develops and manufactures complete electric
drivetrain (eDrive) solutions for established manufacturers of a
broad range of electric vehicles.
Saietta's breakthrough proprietary technologies include AFT
(Axial Flux Technology) and RFT (Radial Flux Technology) motors,
power electronics, powertrain controls, mechanical axles,
transmissions and vehicle control units. Considerable flexibility
is built into the core design, meaning solutions can be quickly and
cost effectively tailored to a specific application.
Saietta works in a highly collaborative way with clients, driven
by the belief that partnership is key to delivering world-class
tailored solutions at pace. Saietta's engineering team takes time
to deeply understand a client's brand, target market sector,
competition and the services they require. Then Saietta develops a
bespoke suite of products and services to fast-track the client to
production with eDrive solutions which deliver a sustainable
competitive advantage.
Chairman's Review
Saietta recognised the need to re-focus on light duty eDrives
ahead of the Period and has delivered on that strategic pivot both
in terms of restructuring its operations and in securing initial
purchase orders from major OEMs.
We believe the Group is at an inflection point for growth, as
evidenced by the orders detailed in the post Period end section
above. These achievements have required a considerable
transformation in the business and there have been changes at Board
and Operational levels as a consequence.
Outlook
Moving from an R&D-focused technology start-up to a
manufacturer, selling complex products internationally, has been a
challenging transformation in a relatively short time frame.
However, with the foundations in place for delivery to its major
OEM customer, Saietta is able to look forward to a sustained period
of motor production and development that will enable it to achieve
its goal of making a positive, substantial difference to
electrification of light duty vehicles, particularly in areas with
high pollution levels such as major cities in India.
Financial Review
(NB: comparative figures are shown for the comparable period in
the previous financial year unless otherwise stated)
Revenue and expenditure both reflect a period of transition
where hitherto engineering design services have been complemented
by motor sales from initial production.
The ramp up of production had just commenced at the end of the
Period, buoyed in particular by the two significant orders obtained
in the period for AYRO inc, in the US and a major OEM in India.
Revenues were broadly in line with prior year with commercial
activity split between completing restructuring of the ConMet and
Propel activities and driving forward operational readiness for the
India production launch.
Operational and administrative expenditure was below prior year
by GBP0.6m (6% decrease), reflecting a lower share option
charge.
Excluding the impact of share option charges and fundraising
costs, the adjusted EBITDA was a loss of GBP6.5m (4% higher than
prior period).
Interim condensed consolidated statement of comprehensive income
and total comprehensive income
Unaudited Unaudited
6 months 6 months
Notes to 30 September to 30 September
2023 2022*
GBP GBP
Revenue 977,229 753,517
Cost of sales (885,773) (653,231)
----------------- -----------------
Gross profit 91,456 100,286
Other income 427,225 498,322
Administrative expenses (9,342,452) (9,916,916)
----------------- -----------------
( 1,910,557
Charge for share options granted (456,635) )
Other administrative expenses (8,885,817) (8,006,359)
----------------- -----------------
Operating loss (8,823,771) (9,318,308)
Finance income 9,263 9,996
Finance expense (131,353) (133,934)
Share of results of associate (1,285) -
Net increase in financial guarantees - (3,507)
Other gains and losses - reversal of impairment 1,036,137 -
losses
Loss before taxation (7,911,009) (9,445,753)
Taxation 222,913 342,610
----------------- -----------------
Loss for the period (7,688,096) (9,103,143)
Discontinued operations
----------------- -----------------
Loss for the year from discontinued operations 5 (510,324) (1,032,078)
----------------- -----------------
Loss for the year attributable to equity
holders of the parent company (8,198,420) (10,135,221)
----------------- -----------------
Other comprehensive income, net of income
tax, to be reclassified to profit and
loss in subsequent periods
Exchange differences on translation of
foreign operations 195,776 (23,224)
----------------- -----------------
Total comprehensive loss for the period (8,002,644) (10,158,445)
================= =================
Basic loss per share (pence) 3 (7.78) (11.66)
*Comparative figures have been restated to exclude income and
expenditure relating to discontinued operations. A reconciliation
of the balances is included in note 5.
Interim condensed consolidated statements of financial
position
Unaudited Audited
at 30 September At 31 March
Notes 2023 2023
GBP GBP
Non-current assets
Intangible assets 6 12,178,523 10,916,016
Property, plant and equipment 9,531,582 8,113,009
Right-of-use assets 5,465,898 5,715,671
Investments in equity accounted associates - 1,285
Other financial assets 976,329 500,000
Other receivables 141,195 141,195
Prepayments and accrued income 92,586 129,016
Total non-current assets 28,386,113 25,516,192
Current assets
Inventories 1,068,118 498,407
Trade and other receivables 2,477,436 2,984,033
Prepayments and accrued income 977,976 3,209,304
Cash and cash equivalents 492,568 7,247,267
Assets of disposal groups held for
sale 187,982 227,474
----------------- ---------------
Total current assets 5,204,080 14,166,485
----------------- ---------------
Total assets 33,590,193 39,682,677
================= ===============
Current liabilities
Trade and other payables 5,865,033 3,035,454
Lease liabilities 1,123,651 1,123,085
Contract liabilities 239,514 326,286
Liabilities of disposal groups held
for sale 15,892 918,828
Total current liabilities 7,244,090 5,403,653
Non-current liabilities
Provisions 30,000 31,541
Lease liabilities 4,592,336 5,058,290
Total non-current liabilities 4,622,336 5,089,831
----------------- ---------------
Total liabilities 11,866,426 10,493,484
================= ===============
Equity
Share capital 113,209 113,209
Share premium 56,670,326 56,670,326
Share options reserve 15,152,829 14,615,611
Foreign currency translation reserve (2,499) (157,537)
Translation reserves of disposal groups (65,436) (106,174)
Accumulated losses (50,144,662) (41,946,242)
----------------- ---------------
Total equity 21,723,767 29,189,193
----------------- ---------------
Total equity and liabilities 33,590,193 39,682,677
================= ===============
Interim condensed consolidated statements of changes in
equity
Notes Share Share Share Translation Accumulated Total
capital premium options reserve losses
reserve
GBP GBP GBP GBP GBP GBP
Balance at
1 April 2022 93,557 34,671,275 12,217,991 (27,939) (14,140,093) 32,814,791
Comprehensive income for the
period
Loss for the
period - - - ( 10,135,221) ( 10,135,221)
Exchange differences
on translation
of foreign
operations - - (119,233) - (119,233)
--------- ------------ ----------- ------------ -------------- ----------------
Total comprehensive ( 10,135,221 ( 10,254,454
expense - - - (119,233) ) )
Contributions by owners
Issue of shares 18,812 23,581,189 - - - 23,600,001
Share issue
costs offset
against share
premium - (1,590,469) - - - (1,590,469)
Share-based
payments - - 1,910,557 - - 1,910,557
Shares issued
on exercise
of employee
share options 746 7,398 - - - 8,144
Balance at
30 September
2022 (unaudited) 113,115 56,669,393 14,128,548 (147,172) (24,275,314) 46,488,570
========= ============ =========== ============ ============== ================
Balance at
1 April 2023 113,209 56,670,326 14,615,611 (263,711) (41,946,242) 29,189,193
Comprehensive income for the
period
Loss for the
period - - - - (8,198,420) (8,198,420)
Exchange differences
on translation
of foreign
operations - - - 155,038 - 155,038
Translation
reserves of
disposal groups - - - 40,738 - 40,738
Total comprehensive
expense - - - 195,776 (8,198,420) (8,002,644)
Share-based
payments - - 537,218 - - 537,218
-------- ----------- ----------- ---------- ------------- ------------
Balance at
30 September
2023 (unaudited) 113,209 56,670,326 15,152,829 (67,935) (50,144,662) 21,723,767
======== =========== =========== ========== ============= ============
Unaudited Unaudited
6 months to 6 months
Notes 30 September to 30 September
2023 2022
GBP GBP
Operating activities
Losses after taxation (8,198,420) (10,135,221)
Adjustments for non-cash items
Taxation (222,913) -
Tax credits received 268,024 (53,535)
Depreciation of property, plant
and equipment 229,792 439,778
Depreciation of right-of-use assets 421,208 553,594
Amortisation of intangible assets 152,894 147,809
Share-based payments 456,635 1,910,557
(Profit)/ loss on disposal of
property, plant and equipment (32,497) 51,595
Profit on disposal of intangible (176,224) -
assets
Currency translation differences 385,368 (218,835)
Interest income (9,263) (9,996)
Interest expense 131,353 138,909
Share of results of associate 1,285 -
Reversal of impairment losses (1,036,137)
Net decrease/ (increase) in financial
liabilities - (76,178)
Cash used in operating activities
before changes in working capital (7,628,895) (7,251,523)
Change in working capital
Increase in inventories (569,711) (442,291)
Decrease/ (increase) in debtors 2,772,158 (652,837)
Increase/ (decrease) in non-interest
bearing liabilities 2,742,807 (3,232,121)
Decrease in provisions (1,541) (641,912)
Net cash flow used in operating
activities (2,685,182) (12,220,684)
Investing activities
Purchases of intangible assets 6 (570,712) (102,776)
Capitalised internally generated
development costs 6 (1,287,915) (3,103,728)
Proceeds on disposal of intangible 519,674 -
assets
Purchase of property, plant and
equipment (1,812,151) (1,725,614)
Proceeds on disposal of property, 145,960 -
plant and equipment
Interest received 9,263 9,996
Loan advanced to associate (476,329) -
Acquisition of equity accounted
investments - (267,784)
Net cash used in investing activities (3,472,210) (5,189,906)
Financing activities
Repayment of lease liabilities (465,954) (197,534)
Proceeds on issue of shares - 23,301,676
Share issue costs - (1,284,000)
Interest paid on lease liabilities (128,776) (136,024)
Interest paid (2,577) (2,885)
-------------- -----------------
Net cash flow from financing
activities (597,307) 21,681,233
Net change in cash and cash equivalents (6,754,699) 4,270,643
Cash and cash equivalents, beginning
of period 7,247,267 18,402,055
Cash and cash equivalents 492,568 22,672,698
============== =================
1. General information
Saietta Group plc is a public limited company, registered in
England and Wales. The address of its registered office is
Riverbank, 2 Swan Lane, London, EC4R 3TT.
The principal activity of the company is the provision of
electric drive solutions including the manufacture of prototype and
production electric motors for vehicles.
2. Basis of preparation and significant accounting policies
The interim condensed consolidated financial statements for the
six-month period ended 30 September 2023 do not include all the
information and disclosures required in the annual consolidated
financial statements, and should be read in conjunction with the
Group's annual consolidated financial statements as at 31 March
2023. The Group has applied the same accounting policies and
methods of computation in its interim condensed consolidated
financial statements as in its annual consolidated financial
statements as at 31 March 2023. The interim condensed consolidated
financial statements are not the statutory accounts of the
Group.
The directors are responsible for the preparation of the
financial statements and to give a true and fair view. The interim
condensed consolidated financial statements are prepared on a going
concern basis.
The interim condensed consolidated financial statements are
presented in pound sterling and all values are rounded to the pound
sterling, except when otherwise indicated.
Going concern
The condensed interim set of financial statements included in
this half-yearly financial report have been prepared on a going
concern basis as the directors consider that the Group has adequate
resources to continue operating for the foreseeable future.
The Group and Company operate in markets that are rapidly
growing and has strategic plans that respond to such growth. In
delivering those plans, the Group is mindful of the ultimate
benefits from maintaining control over the deployment of its
intellectual property in applications with major OEMs and within
its joint venture arrangements. In order to do so, it recognises
that at times it will potentially need to co-invest or defer
investment to its partners to enhance the future value it can
achieve from application of its products. In such instances the
commercial merits will be weighed in determining whether funding is
sought.
On 15(th) December 2023 the Group announced a fund raise of
GBP7.14m before expenses. At that time, the Group indicated that
the fund raise would meet the Group's working capital needs up to
the end of March 2024. Thereafter additional funding would thus be
required. Whilst the Directors expect that such additional funding
can be raised this is not guaranteed and when continuing with an
accelerated expansion this presents a material uncertainty which
may cast significant doubt over the Group's and the Company's
ability to continue as a going concern and therefore its ability to
realise its assets and discharge its liabilities in the normal
course of business. The financial statements do not reflect any
adjustments that would be required to be made if they were prepared
on a basis other than the going concern basis.
Whilst acknowledging the uncertainties described above, the
Board have concluded, on the basis of all scenarios and related
expected cashflows and available sources of finance, that the Group
and Company will be able to continue as a Going Concern for at
least twelve months from the date of signing these financial
statements and therefore it remains appropriate to prepare the
Group and Company's results on the basis of a going concern.
3. Loss per share
The calculation of the basic loss per share is based upon the
net loss after tax attributable to ordinary shareholders and
weighted average number of shares in issue for the year.
Unaudited Unaudited
6 months 6 months
to 30 September to 30 September
2023 2022
Basic Loss per share (pence) (7.78) (11.66)
Loss attributable to equity
shareholders (GBP) (8,002,644) (10,158,445)
Weighted average number
of shares in issue 102,917,675 87,115,466
The basic loss per share set out above is based on the average
number of shares in place across the year.
The Company was loss making for all periods presented, therefore
the dilutive effect of share options has not been taken into
account in the calculation of diluted earnings per share, since
this would decrease the loss per share for each reporting
period.
4. Alternative Performance Measures ("APM")
In reporting financial information, the Group presents
alternative performance measures ("APMs") that are not defined or
specified under the requirements of IFRS. The Group believes that
these APMs, which are not considered to be a substitute for or
superior to IFRS measures, provide stakeholders with additional
helpful information on the performance of the business. The APMs
used within these results are defined below.
Alternative performance Definition
measure
Adjusted EBITDA Adjusted EBITDA above is a non-IFRS measure
and is calculated as the Group's earnings
before interest, tax, depreciation, amortisation,
impairment and extraordinary items including
share-based payment charges, costs related
to Saietta Group Plc's fund-raising,
fees in respect of establishing new staff
pension scheme, write-off inventory acquired
as part of Sunderland lease transaction
and legal fees in respect of the incorporation
of the equity accounted associate.
---------------------------------------------------
The Group uses adjusted EBITDA as an APM to review and measure
the underlying profitability of the Group on an ongoing basis for
comparability as it recognises that increased capital expenditure
year on year will lead to a corresponding increase in depreciation
and amortisation expense recognised within the consolidated income
statement.
Reconciliations between these alternative performance measures
and statutory reported measures are shown below:
Unaudited Unaudited
6 months 6 months
to 30 September to 30 September
2023 2022
GBP GBP
Adjusted EBITDA (6,539,668) (6,312,792)
Depreciation and amortization (1,107,164) (1,167,687)
Finance income 9,263 9,996
Finance expense (131,353) (138,909)
Share-based payment charges (456,635) (1,910,557)
M&A support fees - (99,482)
Costs related to the issue of shares - (513,125)
Costs related to the acquisition
of e-Traction Europe B.V. - (39,932)
Costs related to the co-operation
with Padmini VNA - (59,925)
IPO-dependent staff expenses - (61,165)
Net increase in financial liabilities - (3,507)
Fees in respect of employee pension
scheme set-up (70,000)
Write-off of inventory acquired -
as part of Sunderland transaction - (133,970)
Loss before taxation (8,225,557) (10,501,055)
Taxation 222,913 342,610
Loss for the period (8,002,644) (10,158,445)
================= =================
5. Discontinued operations
6 months 6 months
to 30 September to 30 September
2023 2022
GBP GBP
Revenue 120 -
Cost of sales (7,533) -
Other income 188,954 20,318
Expenses (691,865) (1,052,396)
Net loss attributable to discontinued
operations (attributable to owners
of the Company) (510,324) (1,032,078)
==================== ======================
6. Intangible fixed assets
Patents Development
and licences costs Software Total
GBP GBP GBP GBP
COST
At 1 April 2023 (audited) 990,878 9,462,881 707,484 11,161,243
Additions 223,151 1,625,123 10,353 1,858,627
Disposals - (343,450) - (343,450)
Currency translation differences - (79,732) (662) (80,394)
At 30 September 2023 (unaudited) 1,214,029 10,664,822 717,175 12,596,026
============= =========== ========== ==========
ACCUMULATED AMORTISATION
At 1 April 2023 (audited) 120,594 - 124,633 245,227
Additions 54,436 - 117,863 172,299
Currency translation differences - - (23) (23)
At 30 September 2023 (unaudited) 175,030 - 242,473 417,503
============= =========== ========== ==========
Net book value at 30 September
2023 (unaudited) 1,038,999 10,664,822 474,702 12,178,523
Net book value at 31 March
2023 (audited) 870,284 9,462,881 582,851 10,916,016
============= =========== ========== ==========
-ENDS-
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END
IR NKFBNCBDDABB
(END) Dow Jones Newswires
December 29, 2023 02:00 ET (07:00 GMT)
Saietta (LSE:SED)
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Saietta (LSE:SED)
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