TIDMTHRU
RNS Number : 8905T
Thruvision Group PLC
20 November 2023
20 November 2023
Thruvision Group plc
Interim Results
Thruvision Group plc (AIM: THRU, "Thruvision" or the "Group"),
the leading provider of walk-through security technology, today
announces unaudited results for the six months ended 30 September
2023 (H1 of 2024 financial year - H1 2024) .
Highlights
-- Revenue grew 28% to GBP3.5 million (H1 2023: GBP2.8 million) driven mainly by:
-- Customs market revenue growing 16% to GBP2.0 million (H1 2023: GBP1.7 million) underpinned
by a major contract win with a new Asian customer.
-- Entrance security market seeing renewed demand with revenue increasing to GBP0.8 million (H1
2023: GBP0.04 million).
-- Adjusted gross margin(1) up 5.0pp to 53.9% (H1 2023: 48.9%) helped by particularly positive
pricing mix.
-- Adjusted EBITDA loss(1) reduced slightly to GBP1.4 million (H1 2023: loss GBP1.6 million).
-- Cash balance at 30 September 2023 was GBP2.4 million (31 March 2023: GBP2.8 million).
-- GBP3.2 million (gross) equity fund raising on 26 October 2023 from Pentland Group amongst
other investors to support continued investment in sales and marketing capability and delivering
key new software functionality as well as providing additional working capital flexibility
and strengthening the balance sheet.
-- Pentland Group, owner of numerous consumer brands and majority shareholder in one of the Group's
longest-standing customers, JD Sports, has subsequently increased its strategic shareholding
to 10%.
H1 2024 H1 2023
Unaudited Unaudited
GBPm GBPm Change
------------------------------------- ---------------------------------- -------------- -----------
Adjusted measures(1) :
Adjusted gross profit 1.9 1.4 +41%
Adjusted gross margin 53.9% 48.9% +5.0pp
Adjusted EBITDA loss (1.4) (1.6) +11%
Adjusted loss before tax (1.6) (1.8) +11%
Statutory measures:
Revenue 3.5 2.8 +28%
Gross profit(2) 1.6 1.1 +47%
Gross margin(2) 45.7% 39.8% +5.9pp
Operating loss (1.6) (1.9) +18%
Loss before tax (1.6) (1.9) +17%
------------------------------------- ---------------------------------- -------------- -----------
(1) Alternative performance measures ('APMs') are used
consistently throughout this announcement and are referred to as
'adjusted'. These are defined in full and reconciled to the
reported statutory measures in the Appendix.
(2) As restated see note 5 in the interim financial
statements.
Commenting on the results, Colin Evans, Chief Executive of
Thruvision, said:
"Our proven track record in a number of international markets
has allowed us to deliver a resilient performance despite the US
Customs setback that we reported in October. In addition to further
new Customs agency wins elsewhere, we have seen a marked pick-up in
activity in our Entrance Security market, driven by heightened
geopolitical tension. To capitalise fully on this, we are
accelerating our appointment of new Value-Added Resellers to
broaden our reach geographically.
"Given JD Sports' history as a long-term Thruvision customer,
Pentland Group's strategic investment provided a clear endorsement
of the value of our technology, particularly for the retail market.
This strengthening of the balance sheet, combined with our order
backlog and healthy sales pipeline, gives us confidence that we
will grow strongly into the second half and beyond."
For further information please contact:
Thruvision Group plc +44 (0)1235 425 400
Colin Evans, Chief Executive
Victoria Balchin, Chief Financial Officer
Investec Bank plc +44 (0)20 7597 5970
Patrick Robb / James Rudd / Sebastian Lawrence
Meare Consulting +44 (0)7990 858 548
Adrian Duffield
About Thruvision
Thruvision is the leading developer, manufacturer and supplier
of walk-through security technology. Its technology is deployed in
more than 20 countries around the world by government and
commercial organisations in a wide range of security situations,
where large numbers of people need to be screened quickly, safely
and efficiently. Thruvision's patented technology is uniquely
capable of detecting concealed objects in real time using an
advanced AI-based detection algorithm. The Group has offices and
manufacturing capabilities in the UK and US.
Important information
This announcement may include statements that are, or may be
deemed to be, "forward-looking statements" (including words such as
"believe", "expect", "estimate", "intend", "anticipate" and words
of similar meaning). By their nature, forward-looking statements
involve risk and uncertainty since they relate to future events and
circumstances, and actual results may, and often do, differ
materially from any forward-looking statements. Any forward-looking
statements in this announcement reflect management's view with
respect to future events as at the date of this announcement. Save
as required by applicable law, the Company undertakes no obligation
to publicly revise any forward-looking statements in this
announcement, whether following any change in its expectations or
to reflect events or circumstances after the date of this
announcement.
Interim report
Headlines
The Group demonstrated a resilient performance in the six-month
period to 30 September 2023. The business performed well and
benefited from increasing demand from a broader base of customers,
mainly as a result of a deteriorating security environment
globally.
Revenue grew by 28% to GBP3.5 million (H1 2023: GBP2.8 million),
with an order backlog at 30 September of GBP1.0 million expected to
be delivered in the third quarter. Cash at 30 September 2023 was
GBP2.4 million (31 March 2023: GBP2.8 million).
In particular, we saw increased international government
activity, including initial orders from two new Customs agencies
and renewed focus on improving entrance security across government
and non-government customers. We continued to make good progress in
R&D ahead of a planned new product launch later this financial
year.
Broader US Federal budget challenges meant that, as we reported
in October, CBP did not place an anticipated order by the end of
the first half. We remain engaged with them to ensure that they
derive maximum value from our technology and are in a position to
resume purchasing when the current border crisis allows.
Strategic update
Our strategy is to build on our market-leading position as a
developer, manufacturer and supplier of walk-through security
technology. We aim to become a mainstream provider to, and increase
our market-share in, a number of growing and established
international markets. The continued investment in improving our
patented AI-enhanced Terahertz (THz) imaging technology will
maintain our significant competitive advantage.
The increased geopolitical instability around the world has
added further impetus to the Entrance Security market where
organisations are looking for proven capability to detect weapons
and explosives. This market was somewhat dormant through COVID, but
our strong brand and proven capability has meant we have seen
growing interest and demand in the last few months.
Retailers continue to manage a wide range of conflicting
priorities, including the challenging economic backdrop which is
impacting their investment plans. Our recently published UK-focused
research, undertaken with Retail Economics, shows retail theft is
forecast to be GBP7.9bn this year with some 40% of this
attributable to employees. We continue to focus on retailers who
recognise that Thruvision offers an effective and easy to install
way to reduce, and deter, employee theft while providing an
attractive in-year return on investment.
We are seeing continued interest from Customs agencies
internationally. This is driven by the ongoing focus on border
control and migration management and counter-narcotics
operations.
Given the increasing awareness of our unique technology and
growing demand from an increasing number of countries , we have
accelerated the process of appointing Value-Added Resellers (VARs)
to support the international opportunities and our widening
geographical footprint across Europe, Middle East and Asia.
Strategic investor and fund raising
On 26 October 2023, the Group raised GBP3.2 million gross in new
equity to support its continued investment in sales and marketing
capability and delivering key new software functionality as well as
providing additional working capital flexibility and strengthening
the balance sheet.
After starting discussions earlier in the summer, Pentland Group
became a strategic investor in the Group through this fund-raising.
JD Sports, which is majority owned by Pentland Group, was one of
Thruvision's earliest customers and remains a strong advocate of
our technology. Pentland Group's strategic investment is a clear
endorsement of our capabilities and demonstration of the value of
our technology, particularly for the retail market.
Current trading and outlook
Business performance is resilient and demonstrating good levels
of non-CBP growth. With geopolitical risks driving a strong
bounce-back performance in our Entrance Security market, and
continued strategic progress in Retail Distribution, our unique
technology is being successfully used by a growing number of major
international organisations.
As we outlined on 2 October 2023, the anticipated order from CBP
was not awarded in September which reduced our expectations for the
Group's full year revenue.
However, the recent strengthening of the balance sheet, combined
with our order backlog and healthy sales pipeline, gives us
confidence that we will grow strongly into the second half and
beyond .
Operational review
We operate in four distinct markets where there is the need to
detect, quickly and reliably, a range of different items being
concealed in clothing. These markets are driven by different
factors and protect us against changing political and economic
circumstances.
Customs
Our Customs market revenue grew by 16%, underpinned by a major
contract win with a new Asian customer and another from a new
Central American customs agency, maintaining our momentum in this
global market. In addition, we are expecting further orders in H2
with existing Asian customers who are intending to augment and/or
upgrade their existing fleets of Thruvision units.
Retail Distribution
In Retail Distribution, the Group added new customers including
GXO, the global logistics provider, and TD Synnex, a global
technology provider. We continue to receive orders from existing
customers in the UK and Europe and expand our sales pipeline with
new names in the US. With a new product launch planned later this
year, we expect to see further upgrading by existing customers
moving forward.
On 13 November 2023, Thruvision and Retail Economics published a
report which forecast that the overall theft would cost UK
retailers some GBP7.9bn this year, with employee theft accounting
for some 40% of this total. Around two thirds of those interviewed
in the survey believe that over the past decade the opportunity for
crime in DCs has accelerated and 70% state that they have seen an
increase in organised crime activities in DCs.
Our technology specifically addresses this major problem for
retailers and we expect this report to stimulate further interest
in Thruvision given the proven, rapid return on investment that we
can demonstrate.
Entrance Security
Given the general deterioration in the international security
situation, we have seen increased interest and sales activity in
VIP locations, prisons, critical national infrastructure sites,
natural resources and high security buildings. This interest is
driven by the heightened threat, once more, of weapons and
explosives being brought into facilities, and the fact that
Thruvision is recognised as a fully proven means of detecting such
items at a safe distance.
We secured new customers in Africa and Asia and have seen
further order flow from existing Middle East customers in H1 and
since the period end. The current level of sales enquiries suggest
that this is set to continue into the second half.
Encouraged by this broadening demand, we are accelerating the
rate at which we sign-up regional VARs, focusing on those that new
team members have worked with successfully in the past. This
ensures that we can be confident that these new partners bring
strong relationships with organisations we wish to focus on and
excellent technical capability in terms of supporting our equipment
in the field once deployed.
Aviation
With a formal change in US Government policy now in progress, US
airports are soon to be required to upgrade their approach to the
security screening of staff as they go to work on the "airside" of
an airport. Although in the early stages of development, this
opportunity is expected to mature over the next two years and,
based on the four years of operational experience we have gained
with Seattle Tacoma International Airport, we are very well placed
to provide approved technology to meet this requirement.
Although we have an established solution for security screening
of employees in airports in the US, we require formal US Government
Transportation Security Administration accreditation to compete
with airport body scanners for the passenger screening market. We
started this process in 2020 and, after several COVID-related
delays, it has now restarted. Some further progress has been made
although this remains a protracted process.
Product R&D and Intellectual Property ('IP')
We remain on track to launch our next generation camera range
early in 2024. This will provide an upgraded hardware platform in
addition to new software functionality which will be offered on a
chargeable annual licence basis.
Financial review
Summary
Revenue for the six months ended 30 September 2023 was up 28% to
GBP3.5 million (H1 2023: GBP2.8 million) principally driven by
significant growth in Entrance Security sales. On a constant
currency basis revenue was up 29%.
Adjusted EBITDA loss improved by 11% or GBP0.2 million to GBP1.4
million (H1 2023: loss GBP1.6 million), with adjusted gross profit
growth up GBP0.5 million to GBP1.9 million (H1 2023: GBP1.4
million) more than offsetting overheads which were up, as planned,
by GBP0.3 million.
Adjusted gross margin improved by 5pp to 53.9% (H1 2023: 48.9%)
driven by a pricing mix benefit. Statutory gross margin was up
5.9pp to 45.7%. Operating loss was GBP1.6 million (H1 2023: loss
GBP1.9 million).
Cash as at 30 September 2023 was GBP2.4 million (31 March 2023:
GBP2.8 million), with cash as at 17 November 2023 of
GBP4.3 million. Trade and other receivables were GBP2.9 million
(31 March 2023: GBP4.3 million) and reflect the receipt of all
outstanding balances at 31 March from CBP during the period offset
by recent sales. Cash and the balance sheet more generally have
been strengthened following the fundraise on 26 October 2023.
Revenue
Revenue is split between the two principal activities below:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
GBP'000 GBP'000 GBP'000
------------------------- -------------- -------------- ----------
Product 3,404 2,364 11,782
Support and Development 141 407 638
------------------------- -------------- -------------- ----------
Total 3,545 2,771 12,420
------------------------- -------------- -------------- ----------
Revenue is split by market sector and geographical region
below:
6 months
ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
Revenue by market sector GBP'000 GBP'000 GBP'000
-------------------------- ------------- -------------- ----------
Retail Distribution 799 1,025 2,429
Customs 1,978 1,699 9,165
Aviation 6 12 246
Entrance Security 762 35 580
Total 3,545 2,771 12,420
-------------------------- ------------- -------------- ----------
6 months
ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
Revenue by geographical region GBP'000 GBP'000 GBP'000
-------------------------------- ------------- -------------- ----------
UK and Europe 974 990 2,249
Americas 235 1,759 9,223
Rest of World 2,336 22 948
Total 3,545 2,771 12,420
-------------------------------- ------------- -------------- ----------
Revenue was adversely impacted by translational exchange as the
GBP depreciated against the US$ and decreased revenue by
approximately GBP0.03 million, compared to the prior year average
exchange rate. This resulted in constant currency growth in revenue
of 29% and reported revenue growth of 28%.
Gross profit
Adjusted gross profit improved by GBP0.5 million with a volume
impact of GBP0.3 million and mix impact of GBP0.2 million.
Adjusted gross margin improved by 5.0pp to 53.9% (H1 2023:
48.9%) and reflected the positive price mix. Statutory gross margin
was 5.9pp higher at 45.7% (H1 2023: 39.8%) also reflecting
operational leverage.
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
GBP'000 GBP'000 GBP'000
------------------------ -------------- -------------- ----------
Revenue 3,545 2,771 12,420
Adjusted gross profit 1,912 1,356 6,401
Adjusted gross margin 53.9% 48.9% 51.5%
------------------------ -------------- -------------- ----------
Statutory gross profit 1,621 1,104 5,837
Statutory gross margin 45.7% 39.8% 47.0%
------------------------ -------------- -------------- ----------
Administrative expenses
Administrative expenses increased by 6% to GBP3.2 million with
overheads up by 13% to GBP3.0 million. As well as overheads,
administrative expenses include share-based payment charges or
credits, depreciation and amortisation and impairment of intangible
assets. Overheads as a proportion of sales were 86% (H1 2023: 98%;
2023: 49%) reflecting the growth and phasing of revenue and
continued tight control.
Higher sales and marketing expenditure was impacted by higher
sales commission resulting from the growth in orders. Management
costs decreased with one-off CFO replacement costs in the prior
period, whilst PLC costs were up due to higher insurance costs.
Property and administration costs were higher resulting mainly from
additional finance team headcount supporting growth in the
business.
Adjusted overheads are analysed as follows:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
GBP'000 GBP'000 GBP'000
------------------------------- -------------- -------------- ----------
Sales and marketing 1,122 1,085 2,215
Engineering 607 589 1,270
Management 466 666 1,135
PLC costs 414 354 829
Property and administration 307 191 417
Bonus 47 20 458
Foreign exchange losses
/ (gains) 81 (203) (198)
------------------------------- -------------- -------------- ----------
Overheads 3,044 2,702 6,126
Depreciation and amortisation 205 238 569
Share based payment (credit)
/ charge (72) 51 96
Impairment of intangible
assets - - 36
Administrative expenses 3,177 2,991 6,827
------------------------------- -------------- -------------- ----------
Loss before and after tax and loss per share
Adjusted loss before tax of GBP1.6 million improved by 11% (H1
2023: loss GBP1.8 million) with statutory loss before tax of GBP1.6
million improving by 17% (H1 2023: loss GBP1.9 million).
Statutory loss after tax improved by 18% to a loss of GBP1.5 m
illion with the adjusted loss after tax of GBP1.6 million improving
by 11% (H1 2023: loss GBP1.8 million).
The loss per share and adjusted loss per share were 1.01 pence
and 1.06 pence respectively (H1 2023: loss per share and adjusted
loss per share of 1.23 pence and 1.19 pence respectively) and
reflected the movements in adjusted and statutory loss after
tax.
Cash flow
The decrease in cash and cash equivalents of GBP0.4 million to
GBP2.4 million at 30 September 2023 (30 September 2022: GBP1.1
million, 31 March 2023: GBP2.8 million) was driven by an operating
cash outflow before working capital of GBP1.4 million partly offset
by a net working capital inflow of GBP1.0 million and an R&D
tax credit received of GBP0.4m together with investing outflows and
financing outflows of GBP0.2 million each.
Movements in working capital in the period were:
-- Trade and other receivables decreased by GBP1.5 million, principally
driven by cash received from CBP of GBP2.7 million.
-- Increased inventory to support order backlog to be delivered
in the second half of the year resulted in a GBP0.3 million
outflow.
-- A decrease in trade and other payables resulted in an outflow
of GBP0.2 million. Trade creditors decreased due to the timing
of stock purchases.
On 26 October 2023, the Group completed a placing of 13,617,021
new ordinary shares of 23.5 pence per share raising GBP3.2 million
of gross proceeds. The net proceeds of the placing will be used for
continued investment in the Group's sales and marketing capability
and delivering key new software functionality. It will also provide
the Group with additional working capital flexibility and
strengthen the Group's balance sheet.
Other
A limited programme of share purchases by the Thruvision plc EBT
commenced on 1 April 2023 with the purpose of partly satisfying
future employee exercises of share options. During the period
455,029 shares in the Group were purchased by the EBT for total
consideration of GBP119,000.
Consolidated income statement
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2022 2022(1) 2023
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
------------------------- ------ ------------- ------------- ----------------
Revenue 2 3,545 2,771 12,420
Cost of sales (1,924) (1,667) (6,583)
------------------------- ------ ------------- ------------- ----------------
Gross profit 1,621 1,104 5,837
Administrative expenses (3,177) (2,991) (6,827)
Operating loss (1,556) (1,887) (990)
Financial income 25 11 26
Finance costs (37) (16) (15)
------------------------- ------ ------------- ------------- ----------------
Loss before tax (1,568) (1,892) (979)
Taxation credit 86 89 174
------------------------- ------ ------------- ------------- ----------------
Loss for the period (1,482) (1,803) (805)
------------------------- ------ ------------- ------------- ----------------
Loss per share
------------------------- ------ ------------- ------------- ----------------
Loss per share - basic
and diluted 3 (1.01p) (1.23p) (0.55p)
------------------------- ------ ------------- ------------- ----------------
All operations are continuing.
(1) As restated see note 5 to the interim financial
statements.
Consolidated statement of comprehensive income
6 months 6 months Year ended
ended ended
30 September 30 September 31 March 2023
2023 2022
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------- ------------- ------------- --------------
Loss for the period attributable
to owners of the parent (1,482) (1,803) (805)
Other comprehensive loss
- items that may be subsequently
reclassified to profit or
loss:
------------------------------------ ------------- ------------- --------------
Exchange differences
on retranslation
of foreign operations (24) (45) (50)
Total comprehensive loss
attributable to owners of
the parent (1,506) (1,848) (855)
------------------------------------ ------------- ------------- --------------
Consolidated statement of financial position
at 30 September 2023
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
Note GBP'000 GBP'000 GBP'000
------------------------------- ----- --------------- ------------- ------------
Assets
Non-current assets
Property, plant and equipment 1,210 962 1,173
Other intangible assets 116 140 109
------------------------------- ----- --------------- ------------- ------------
1,326 1,102 1,282
Current assets
Inventories 3,895 4,772 3,639
Trade and other receivables 2,851 3,813 4,342
Current tax receivable 81 302 375
Cash and cash equivalents 2,372 1,091 2,810
------------------------------- ----- --------------- ------------- ------------
9,199 9,978 11,166
------------------------------- ----- --------------- ------------- ------------
Total assets 10,525 11,080 12,448
Current liabilities
Trade and other payables (2,493) (2,399) (2,690)
Lease liabilities (132) (158) (121)
Provisions (102) (206) (107)
------------------------------- ----- --------------- ------------- ------------
(2,727) (2,763) (2,918)
------------------------------- ----- --------------- ------------- ------------
Net current assets 6,472 7,215 8,248
------------------------------- ----- --------------- ------------- ------------
Non-current liabilities
Trade and other payables (54) (69) (72)
Lease liabilities (557) (449) (604)
Provisions (38) (38) (38)
------------------------------- ----- --------------- ------------- ------------
(649) (556) (714)
------------------------------- ----- --------------- ------------- ------------
Total liabilities ( 3,376) (3,319) (3,632)
------------------------------- ----- --------------- ------------- ------------
Net assets 7,149 7,761 8,816
------------------------------- ----- --------------- ------------- ------------
Equity
Share capital 4 1,474 1,472 1,472
Share premium 352 308 325
Capital redemption reserve 163 163 163
Translation reserve (13) 16 11
Retained earnings 5,173 5,802 6,845
------------------------------- ----- --------------- ------------- ------------
Total equity attributable to
owners of the Company 7,149 7,761 8,816
-------------------------------------- --------------- ------------- ------------
Consolidated statement of changes in equity (unaudited)
Capital
Share Share redemption Translation Retained Total
capital premium reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ --------- --------- ------------ --------------- ------------ -----------------
At 31 March 2022 1,466 201 163 61 7,554 9,445
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Shares issued 6 107 - - - 113
Share based payment
charge - - - - 51 51
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Transactions with
shareholders 6 107 - - 51 164
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Loss for the period - - - - (1,803) (1,803)
Other comprehensive
loss - - - (45) - (45)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Total comprehensive
loss - - - (45) (1,803) (1,848)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
At 30 September 2022 1,472 308 163 16 5,802 7,761
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Shares issued - 17 - - - 17
Share based payment
charge - - - - 45 45
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Transactions with
shareholders - 17 - - 45 62
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Profit for the period - - - - 998 998
Other comprehensive
expense - - - (5) - (5)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Total comprehensive
(loss)/income - - - (5) 998 993
------------------------ --------- --------- ------------ --------------- ------------ -----------------
At 31 March 2023 1,472 325 163 11 6,845 8,816
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Shares issued 2 27 - - - 29
Purchase of own shares - - - - (119) (119)
Share based payment
credit - - - - (71) (71)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Transactions with
shareholders 2 27 - - (190) (161)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Loss for the period - - - - (1,482) (1,482)
Other comprehensive
loss - - - (24) - (24)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Total comprehensive
loss - - - (24) (1,482) (1,506)
------------------------ --------- --------- ------------ --------------- ------------ -----------------
At 30 September
2023 1,474 352 163 (13) 5,173 7,149
------------------------ --------- --------- ------------ --------------- ------------ -----------------
Consolidated statement of cash flows
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------------- ------------- ------------- -----------
Operating activities
Loss after tax (1,482) (1,803) (805)
Adjustments for:
Taxation credit (86) (89) (174)
Financial income (25) (10) (26)
Finance costs 37 16 15
Depreciation of property, plant
and equipment 227 258 619
Profit on disposal of property,
plant & equipment - (10) (10)
Amortisation of intangible assets 9 10 20
Impairment of intangible assets - - 36
Share-based payment (credit)
/ charge (72) 51 96
---------------------------------------- ------------- ------------- -----------
Operating cash outflow before
changes in working capital and
provisions (1,392) (1,577) (229)
Decrease / (increase) in trade
and other receivables 1,491 (1,811) (2,360)
Increase in inventories (256) (904) (183)
(Decrease) / increase in trade
and other payables (191) 26 321
(Decrease) / increase in provisions (5) 28 (71)
Cash utilised in operations (353) (4,238) (2,522)
Net income taxes received 380 - -
----------------------------------------- ------------- ------------- -----------
Net cash inflow / (outflow) from
operating activities 27 (4,238) (2,522)
----------------------------------------- ------------- ------------- -----------
Investing activities
Purchase of property, plant &
equipment (241) (26) (37)
Purchase of intangible assets (18) (70) (86)
Proceeds from disposal of property,
plant and equipment - 11 11
Interest received 25 10 26
Net cash outflow from investing
activities (234) (75) (86)
----------------------------------------- ------------- ------------- -----------
Financing activities
Proceeds from issues of shares 29 93 130
Purchase of own shares (119) - -
Payments on principal portion
of lease liabilities (93) (81) (180)
Other finance costs (12) - -
Interest paid on lease liabilities (23) (4) (15)
Net cash outflow from financing
activities (218) (89) (65)
----------------------------------------- ------------- ------------- -----------
Net decrease in cash and cash
equivalents (425) (4,305) (2,673)
----------------------------------------- ------------- ------------- -----------
Cash and cash equivalents at beginning
of the period 2,810 5,441 5,441
Effect of foreign exchange rate
changes (13) (45) 42
----------------------------------------- ------------- ------------- -----------
Cash and cash equivalents at
end of the period 2,372 1,091 2,810
----------------------------------------- ------------- ------------- -----------
Notes to the financial statements
1. Accounting policies
Basis of preparation
The consolidated interim financial statements include those of
Thruvision Group plc and all of its subsidiary undertakings
(together "the Group") drawn up at 30 September 2023 and have been
prepared in accordance with International Accounting Standard 34,
"Interim Financial Reporting" ("IAS 34") as adopted for use in the
European Union ("EU"). The consolidated interim financial
statements have been prepared using accounting policies and methods
of computation consistent with those applied in the consolidated
financial statements for the period ended 31 March 2023.
The Group is a public limited company incorporated and domiciled
in England & Wales and whose shares are quoted on AIM, a market
operated by The London Stock Exchange. All values are rounded to
GBP'000 except where otherwise stated.
Accounting policies
The annual consolidated financial statements of the Group are
prepared on the basis of International Financial Reporting
Standards ("IFRS"). The consolidated interim financial statements
are presented on a condensed basis as permitted by IAS 34 and
therefore do not include all the disclosures that would otherwise
be required in a full set of financial statements and should be
read in conjunction with the most recent Annual Report and Accounts
which were approved by the Board of Directors on 20 July 2023 and
have been filed with Companies House. The condensed interim
financial statements do not constitute statutory accounts as
defined in Section 435 of the Companies Act 2006 and are unaudited
for all periods presented. The financial information for the
12-month period ended 31 March 2023 is extracted from the financial
statements for that period. The auditors' report on those financial
statements was unqualified and did not contain an emphasis of
matter reference and did not contain a statement under section
498(2) or (3) of the Companies Act 2006 .
The half year results for the current period to 30 September
2023 have not been audited or reviewed by auditors pursuant to the
Auditing Practices Board guidance of Review of Interim Financial
Information.
Adoption of new and revised International Financial Reporting
Standards
The Group's accounting policies have been prepared in accordance
with IFRS effective as at its reporting date of
30 September 2023.
Standards Issued
The standards and interpretations that are issued up to the date
of issuance of the Group's interim financial statements are
disclosed below. The Group has adopted these standards, if
applicable, when these became effective. Further details are
disclosed in the 31 March 2023 Annual Report available on the
Group's website: www.thruvision.com.
Accounting developments - new standards, amendments and
interpretations issued and adopted
There were no new accounting standards or amendments requiring
disclosure in the period.
Going concern
The Group's loss before tax from continuing operations for the
period was GBP1.6 million (H1 2023: GBP1.9 million; FY 2023: GBP1.0
million). As at 30 September 2023 the Group had net current assets
of GBP6.5 million (30 September 2022: GBP7.2 million; 31 March
2023: GBP8.2 million) and cash and cash equivalents of GBP2.4
million (30 September 2022: GBP1.1 million; 31 March 2023: GBP2.8
million).
The Board has reviewed cash flow forecasts for the period up to
and including 31 December 2024. These forecasts and projections
take into account reasonably possible changes in trading
performance and show that the Group will be able to react as
required in order to operate within the level of current funding
resources, and no need for the Group to take on any debt. In order
to stress-test the adoption of the going concern basis, a cashflow
forecast was also produced which looked at the highly unlikely
scenario in which no further sales took place, other than delivery
of existing backlog, and certain discretionary areas of cash
expenditure were reduced. This showed that even under this extreme
condition, the Group would still have positive cash reserves as at
31 December 2024 with no need to take on external debt. The
Directors therefore believe there is sufficient cash available to
the Group to manage through these requirements. As with all
businesses, there are particular times of the year where the
Group's working capital requirements are at their peak. However,
the Group is well placed to manage business risk effectively and
the Board reviews the Group's performance against budgets and
forecasts on a regular basis to ensure action is taken where
needed.
The Directors therefore are satisfied that the Group has
adequate resources to continue operating for a period of at least
12 months from the approval of these accounts. For this reason,
they have adopted the going concern basis in preparing the
financial statements.
Notes to the financial statements (continued)
2. Segmental information
The Directors do not split the business into segments in order
to internally analyse the business performance. The Directors
believe that allocating overheads by department provides a suitable
level of business insight. The overhead department cost centres
comprise of engineering, sales and marketing, property and
administration, management and PLC costs, with the split of costs
as shown in the Financial Review on page 6.
Analysis of revenue by customer
There have been two (H1 2023: two; FY 2023: one) individually
material customer(s) (each comprising in excess of 10% of revenue)
during the period. These customers individually represented
GBP1,885k and GBP440k of revenue (H1 2023: GBP1,335k and GBP415k,
FY 2023: GBP8,268k).
The Group's revenue by market sector, geographical location and
type is detailed below:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
Revenue by market sector GBP'000 GBP'000 GBP'000
-------------------------- -------------- -------------- ----------
Retail Distribution 799 1,025 2,429
Customs 1,978 1,699 9,165
Aviation 6 12 246
Entrance Security 762 35 580
Total 3,545 2,771 12,420
-------------------------- -------------- -------------- ----------
6 months 6 months Year ended
ended 30 ended 30 31 March
September September 2023
2023 2022
Unaudited Unaudited Audited
Revenue by geographical location GBP'000 GBP'000 GBP'000
---------------------------------- ----------- ----------- --------------
UK and Europe 974 990 2,249
Americas 235 1,759 9,223
Rest of World 2,336 22 948
3,545 2,771 12,420
---------------------------------- ----------- ----------- --------------
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2023 2022 2023
Revenue by type GBP'000 GBP'000 GBP'000
------------------------- -------------- -------------- ----------
Product 3,404 2,364 11,782
Support and Development 141 407 638
------------------------- -------------- -------------- ----------
Total 3,545 2,771 12,420
------------------------- -------------- -------------- ----------
The Group's non-current assets by geography are detailed
below:
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
-------------------------- -------------- -------------- -------------
UK 1,110 1,037 1,027
United States of America 216 65 255
1,326 1,102 1,282
-------------------------- -------------- -------------- -------------
Notes to the financial statements (continued)
2. Segmental information (continued)
The Group's revenue by type is detailed below:
6 months ended 6 months Year ended
30 September ended 30 31 March
2023 September 2023
2022
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------------- --------------- ----------- --------------
Revenue recognised at point
in time 3,507 2,398 11,888
Revenue recognised over time
- extended warranty and support
revenue 38 373 532
3,545 2,771 12,420
---------------------------------- --------------- ----------- --------------
3. Loss per share
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
Loss after tax (GBP'000) (1,482) (1,803) (805)
----------------------------------- ------------- ------------- ----------------
Weighted average number of shares 147,292,757 147,097,721 147,138,774
----------------------------------- ------------- ------------- ----------------
Basic and diluted loss per share
(pence) (1.01p) (1.23p) (0.55p)
----------------------------------- ------------- ------------- ----------------
The inclusion of potential Ordinary Shares arising from LTIPs
and EMI Options would be anti-dilutive. Basic and diluted loss per
share has therefore been calculated using the same weighted number
of shares for each period.
4. Share capital
As 30 September 2023, there were 147,368,117 Ordinary Shares in
issue (30 September 2022: 147,165,718;
31 March 2023: 147,247,239). The Thruvision Group Plc Employee
Benefit Trust held 455,029 shares in the Company (30 September
2022: nil; 31 March 2023: nil).
On 26 October 2023, the Company issued 13,617,021 new Ordinary
Shares of 1 penny each at a premium of 22.5 pence each as part of
the placing for which gross proceeds of GBP3.2 million was
received. Following the placing, 161,015,138 Ordinary Shares were
in issue.
5. Restatement
In the audited results for the year ended 31 March 2023, gross
margin was restated to correctly classify certain fixed costs and
variable production overheads including production staff costs and
related overheads to cost of sales from administrative expenses.
The unaudited results for the six months ended 30 September 2022
have been restated accordingly to ensure comparability, with total
costs reclassified from administrative expenses to cost of sales of
GBP0.3 million. There is no impact on operating profit, basic and
diluted loss per share or the Statement of Financial Position.
6. Post balance sheet events
On 26 October 2023, the Group concluded a placing of 23.5 pence
per share raising GBP3.2 million of gross proceeds and issuing
13,617,021 new Ordinary Shares, including a significant strategic
investment from Pentland Capital.
APPIX - ALTERNATIVE PERFORMANCE MEASURES ('APMs')
Policy
Thruvision uses adjusted figures as key performance measures in
addition to those reported under IFRS, as management believe these
measures enable management and stakeholders to assess the
underlying trading performance of the businesses as they exclude
certain items that are considered to be significant in nature
and/or quantum.
The APMs are consistent with how the businesses' performance is
planned and reported within the internal management reporting to
the Board. Some of these measures are used for the purpose of
setting remuneration targets.
The key APMs that the Group uses include adjusted measures for
the income statement together with adjusted cash flow measures.
Explanations of how they are calculated and how they are reconciled
to an IFRS statutory measure are set out below.
Adjusted measures
The Group's policy is to exclude items that are considered to be
significant in nature and/or quantum, where the item is volatile in
nature and cannot be directly linked to underlying trading, and
where treatment as an adjusted item provides stakeholders with
additional useful information to better assess the period-on-period
trading performance of the Group.
The Group excludes certain items, which management have defined
as:
- Share based payments charge or credit
- Impairments of intangible assets
Gross profit, excluding production overheads is used to enable a
like-for-like comparison of underlying sales profitability.
Production overheads are excluded due to changes in product mix and
investments in the production team which have improved capacity and
therefore changes the labour and overhead absorption rates. This is
represented by adjusted gross profit.
Based on the above policy, the adjusted performance measures are
derived from the statutory figures as follows:
a) Adjusted gross profit
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------- ------------- ------------- ------------
Gross profit 1,621 1,104 5,837
----------------------- ------------- ------------- ------------
Add back:
Production overheads 291 252 564
----------------------- ------------- ------------- ------------
Adjusted gross profit 1,912 1,356 6,401
----------------------- ------------- ------------- ------------
b) Adjusted EBITDA
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------------- ------------- ------------- ------------
Statutory operating loss (1,556) (1,887) (990)
--------------------------------- ------------- ------------- ------------
Add back:
Depreciation and amortisation 236 268 639
Impairment of intangible assets - - 36
Share-based payment (credit)
/ charge (72) 51 96
--------------------------------- ------------- ------------- ------------
Adjusted EBITDA (1,392) (1,568) (219)
--------------------------------- ------------- ------------- ------------
c) Adjusted loss before tax
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------------- ------------- ------------- ------------
Statutory loss before tax (1,568) (1,892) (979)
--------------------------------- ------------- ------------- ------------
Add back:
Impairment of intangible assets - - 36
Share-based payment (credit)
/ charge (72) 51 96
--------------------------------- ------------- ------------- ------------
Adjusted loss before tax (1,640) (1,841) (847)
--------------------------------- ------------- ------------- ------------
d) Adjusted loss per share
6 months 6 months Year ended
ended ended
30 September 30 September 31 March
2023 2022 2023
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------- ------------- ------------- ------------
Statutory loss after tax (1,482) (1,803) (805)
----------------------------------- ------------- ------------- ------------
Add back:
Impairment of intangible assets - - 36
Share-based payment (credit)
/ charge (72) 51 96
----------------------------------- ------------- ------------- ------------
Adjusted loss after tax (1,554) (1,752) (673)
----------------------------------- ------------- ------------- ------------
Weighted average number of shares 147,292,757 147,097,721 147,138,774
----------------------------------- ------------- ------------- ------------
Statutory loss per share (pence) (1.01) (1.23) (0.55)
----------------------------------- ------------- ------------- ------------
Adjusted loss per share (pence) (1.06) (1.19) (0.46)
----------------------------------- ------------- ------------- ------------
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END
IR DDLFFXFLLFBX
(END) Dow Jones Newswires
November 20, 2023 02:00 ET (07:00 GMT)
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