TIDMIGE
RNS Number : 8697W
Image Scan Holdings PLC
28 April 2021
The following amendment(s) has (have) been made to the 'Interim
Results' announcement released on 28/04/2021 at 7.00 a.m. under RNS
No 7769W.
The financial statements have been included in this
announcement.
All other details remain unchanged.
The full amended text is shown below.
Image Scan Holdings plc
Interim Report 2021
28/04/2021
IMAGE SCAN HOLDINGS PLC
("Image Scan" or the "Company")
(AIM: IGE)
INTERIM RESULTS
Image Scan, (AIM: IGE) specialists in the field of X-ray imaging
for the security and industrial inspection markets, today announces
its interim results for the six months ended 31 March 2021. During
the first six months the performance of the Company has continued
to be impacted by COVID-19, but there is a sufficiently strong
orderbook and pipeline of new business for us to expect a stronger
second half.
Financial summary:
-- Revenue GBP868k (2020: GBP2.3m)
-- Gross profit margin improved to 55% (2020: 45%)
-- Loss before taxation of GBP201k (2020: profit of GBP180k)
-- Period end bank balance of GBP1m (2020: GBP1.1m)
-- Order intake GBP938k (2020: GBP1.5m)
-- Period end order book of GBP702k (2020: GBP933k)
-- Order book increased to GBP1.5m at 27 April 2021 including
large Asian portable X-ray contract win
Operational highlights:
-- First order for new conveyor X-ray system received from USA
-- New portable X-ray customer in Canada
-- Contract to supply portable X-ray systems to RAF
-- New orders for industrial screening systems
-- Research and Development effort supported by customer funding
-- Large portable X-ray order received from Asian customer after period end
The Board considers that the Company has a sufficiently strong
pipeline of new orders to continue to trade in line with market
expectations for the year ending 30 September 2021 which are for
sales of GBP3m and a loss of GBP200k.
Bill Mawer, Chairman and Chief Executive Officer of Image Scan
commented: "We expected that the COVID-19 pandemic would continue
to impact the flow of new orders into the business in the first
half of this financial year, and that impact is reflected in these
results. However, we are delighted that our new products are
finding their first customers and that we have been able to open up
new markets in North America and the UK. The new portable X-ray
order and our strong new business pipeline point to a stronger
performance in the second half, though we continue to monitor
closely the potential impact of COVID-19 outbreaks in important
markets such as India and Brazil. Nonetheless, we will continue our
ambitious new product development programme as this is putting us
in a strong position for when the effects of the pandemic
diminish."
For further information on the Company, please visit:
www.ish.co.uk and for further information on its
products, please visit: www.3dx-ray.com
Enquiries:
Image Scan Holdings plc Tel: +44 (0) 1509 817
William Mawer, Chairman and Chief Executive Officer 400
Sarah Atwell King, Finance Director and Company ir@ish.co.uk
Secretary
----------------------
W H Ireland - Nominated Adviser and Broker Tel: +44 (0) 117 945
Mike Coe/Chris Savidge (Corporate Finance) 3470
Jasper Berry (Broking)
----------------------
Chairman's statement
Introduction
Image Scan Holdings plc is a specialist in innovative X-ray
technology, operating globally in the security and industrial
inspection sectors. The Company's principal activity is the design,
manufacture, and supply of both portable and fixed X-ray security
screening systems to governments, security organisations and law
enforcement agencies. The Company also supplies high-quality image
acquisition systems for non-destructive testing to commercial
organisations worldwide.
Financial results
Revenues for the six months ended 31 March 2021 declined to
GBP868k (2020: GBP2.3m) reflecting the low opening order book of
GBP633k and the fact that much of the order intake of GBP938k
(2020: GBP1.5m) arrived towards the end of the period. We saw
delays in a number of important projects as Governments worldwide
continued to focus on battling the pandemic. However, a key new
portable X-ray project, one of those directly delayed by COVID-19,
was won after the period end.
A favourable mix of sales lead to an improvement in gross margin
to 55% (2020: 45%). Costs were carefully managed, and we received
GBP32k from the Government furlough scheme to support salaries in
quiet periods, allowing us to reduce overheads by 20% to GBP682k
(2020: GBP840k). The loss for the period was GBP201k (2020: profit
of GBP180k).
The Company finished the period with an orderbook of GBP702k
(2020: GBP933k) and positive cash balance of GBP1m (2020: GBP1.1m).
Trading in the first part of April, brought the orderbook to
GBP1.5m at April 27(th) .
Overview
While overall order intake for security systems was at a
disappointing level in the period, the orders received did include
some notable wins. Examples include: a follow-on order for portable
X-ray systems from a major global NGO, who uses our scanners to
support its worldwide operations; a first order for a conveyor
X-ray system for a customer in the USA, as well as previously
announced orders in the UK and Canada. Since the period end, we
have received a large contract for portable X-ray systems and the
first order for the new Axis-CXi cabinet X-ray screening system,
both from customers in Asia
While we have been concerned about the impact of the pandemic on
our automotive customers, it is reassuring to have received orders
for two new industrial screening systems and to be working on the
implementation of new X-ray measurement techniques under a customer
funded software development contract.
Our access to global security markets is a key strength of the
Company and it has been pleasing to see our investment in
appointing a sales consultant in North America bear fruit with new
customers in both Canada and the USA. We have also won orders from
new customers in Eastern Europe and Asia.
Servicing our large installed base of industrial screening
systems has presented a challenge through the pandemic, but we have
adapted to this situation through customer training, increased
remote machine access and recruitment of overseas service
partners.
We continue to invest in our product range and the launch of the
Axis-CXi cabinet X-ray scanner in October 2020 was a significant
milestone. This system brings new levels of performance to the
cabinet X-ray market and we are pleased by the level of customer
interest. We expect to have a number of variants of our conveyor
X-ray system fully on the market in the next few months. We are
exploring new X-ray detection and image processing techniques to
further strengthen the differentiation of our products in the
security X-ray marketplace.
Outlook - COVID-19 and beyond
The path of the Covid-19 pandemic continues to be unpredictable.
Two places where the disease is currently most prevalent are India
and Brazil, one a longstanding market for the Company, the other a
more recent addition for which we have high hopes for the future.
In other parts of the world, the disease has subsided, and more
normal levels of activity are starting to return. The new portable
X-ray order described above will be delivered in the second half
and so we remain cautiously optimistic for an improved performance
in the second half and that we can trade in line with market
expectations for the year as a whole.
Our strategy continues to be focussed on expansion of the
product range so that, as market activity returns to more normal
levels, we are well placed to capitalise, offering the broader
product range through our excellent network of local partners. Our
product development strategy meets several goals: the maintenance
and upgrade of existing products, for which recently launched Wi-Fi
range extenders for portable X-ray systems would be an example; the
broadening of current product ranges to include multiple formats
for different users, and, lastly the development of new product
ranges such as the recent addition of new conveyor X-ray systems.
The partner network continues to expand, and this has led to the
recent acquisition of promising new customers in several
regions.
To better support the sales activity in an environment where
travel is difficult or impossible, we are currently building a
demonstration room at our facility that will be fully equipped to
support on-site visits, attendance at on-line trade exhibitions and
person to person remote presentations and demonstrations. We
continue to expand our on-line and social media presence and our
participation in counter terrorism forums.
The Company retains a positive outlook and our small but
industrious team work hard to build a platform for sustainable
growth into the future. On behalf of my fellow Board members, I
would like to formally thank all our personnel for their
outstanding response to the continuing challenging
circumstances.
Bill Mawer
Chairman and Chief Executive Officer
28/04/2021
Consolidated income statement
For the six months ended 31 March 2021
Six months Six months Year ended
ended ended 30 September
31 March 31 March
2021 2020 2020
(Unaudited) (Unaudited) (Audited)
Note GBP'000 GBP'000 GBP'000
------------
Revenue 868 2,287 3,484
------------ ------------ -------------
Cost of sales (387) (1,268) (1,760)
------------ ------------ -------------
Gross profit 481 1,019 1,724
------------ ------------ -------------
Operating expenses (682) (840) (1,612)
------------ ------------ -------------
Operating (loss)/profit (201) 179 112
------------ ------------ -------------
Finance income - 1 1
------------ ------------ -------------
Loss/(profit) before taxation (201) 180 113
------------ ------------ -------------
Taxation - - 25
------------ ------------ -------------
Loss/(profit) for the period (201) 180 138
------------ ------------ -------------
Pence Pence Pence
Earnings per share
---- ------ ----- -----
Basic profit per share [3] (0.15) 0.13 0.10
---- ------ ----- -----
Diluted profit per share (0.15) 0.13 0.10
------ ----- -----
Consolidated statement of changes in equity
For the six months ended 31 March 2020
Six months Six months Year ended
ended ended 30 September
31 March 31 March
2021 2020 2020
(Unaudited) (Unaudited) (Audited)
Note GBP'000 GBP'000 GBP'000
------------
Opening equity shareholders' funds 1,409 1,268 1,268
------------ ------------ -------------
Share-based payments [4] - 4 3
----- ------------ ------------ -------------
(Loss)/profit attributable to equity
shareholders (201) 180 138
------------ ------------ -------------
Closing equity shareholders' funds 1,208 1,452 1,409
------------ ------------ -------------
Consolidated statement of financial position
As at 31 March 2020
As at As at As at
31 March 31 March
2021 2020 30 September
(Unaudited) (Unaudited) 2020
GBP'000 GBP'000 (Audited)
GBP'000
Non-current assets
------------ ------------ -------------
Intangible and tangible assets 61 40 64
------------ ------------ -------------
61 40 64
------------ ------------ -------------
Current assets
------------ ------------ -------------
Inventories 366 439 450
------------ ------------ -------------
Trade and other receivables 404 697 315
------------ ------------ -------------
Cash and cash equivalents 1,048 1,140 1,410
------------ ------------ -------------
1,818 2,276 2,175
------------ ------------ -------------
Total assets 1,879 2,316 2,239
------------ ------------ -------------
Current liabilities
------------ ------------ -------------
Trade and other payables 671 864 783
------------ ------------ -------------
Non-current liabilities
------------ ------------ -------------
Bank Loan 47
------------ ------------ -------------
Total liabilities 671 864 830
------------ ------------ -------------
Net assets 1,208 1,452 1,409
------------ ------------ -------------
Equity
------------ ------------ -------------
Share capital 1,363 1,363 1,363
------------ ------------ -------------
Share premium account 8,328 8,328 8,328
------------ ------------ -------------
Retained earnings (8,483) (8,239) (8,282)
------------ ------------ -------------
Equity shareholders' funds 1,208 1,452 1,409
------------ ------------ -------------
Consolidated cash flow statement
For the six months ended 31 March 2021
Six months Year ended
ended 30 September
31 March
2021 2020
(Unaudited) (Audited)
GBP'000 Six months
ended 31
March 2020
(Unaudited)
GBP'000 GBP'000
Cash flows from operating activities
------------ ------------ -------------
Operating (loss)/profit (201) 179 112
------------ ------------ -------------
Adjustments for:
------------ ------------ -------------
Depreciation 10 11 21
------------ ------------ -------------
Impairment of inventories 9 14 26
------------ ------------ -------------
Amortisation of Lease 21 - 39
------------ ------------ -------------
(Decrease)/increase in provision for
warranty (9) 16 18
------------ ------------ -------------
Decrease in inventories 75 330 306
------------ ------------ -------------
(Increase)/decrease in trade and other
receivables (90) (143) 350
------------ ------------ -------------
(Decrease)/increase in trade and other
payables (98) 29 (140)
------------ ------------ -------------
Share-based payment charge - 4 4
------------ ------------ -------------
Net cash used in operating activities (283) 440 736
------------ ------------ -------------
Corporation tax recovered (1) 64 32
------------ ------------ -------------
Net cash outflow from operating activities (284) 504 768
------------ ------------ -------------
Cash flows from investing activities
------------ ------------ -------------
Interest received - 1 1
------------ ------------ -------------
Purchase of intangible and tangible
assets (7) (6) (10)
------------ ------------ -------------
Net cash used in investing activities (7) (5) (9)
------------ ------------ -------------
Cash flows from financing activities
------------ ------------ -------------
(Repayment)/proceeds from bank loan (50) - 50
------------ ------------ -------------
Lease payments (21) - (40)
------------ ------------ -------------
Net cash from financing activities (71) - 10
------------ ------------ -------------
Net (decrease)/increase in cash and
cash equivalents (362) 499 769
------------ ------------ -------------
Cash and cash equivalents at beginning
of period 1,410 641 641
------------ ------------ -------------
Cash and cash equivalents at end of
period 1,048 1,140 1,410
------------ ------------ -------------
Notes to the unaudited interim financial statements
For the six months ended 31 March 2021
1 Basis of preparation
The interim financial statements, which are unaudited, have been
prepared on the basis of the accounting policies expected to apply
for the financial year to 30 September 2021 and in accordance with
recognition and measurement principles of International Financial
Reporting Standards ('IFRSs') as endorsed by the European Union.
The accounting policies applied in the preparation of these interim
financial statements are consistent with those used in the
financial statements for the year ended 30 September 2020.
The interim financial statements do not include all of the
information required for full annual financial statements and do
not comply with all the disclosures in IAS 34 'Interim financial
reporting'. Accordingly, whilst the interim statements have been
prepared in accordance with IFRSs, they cannot be construed as
being in full compliance with IFRSs.
The financial information for the year ended 30 September 2020
does not constitute the full statutory accounts for that period.
The annual report and financial statements for the year ended 30
September 2020 have been filed with the Registrar of Companies. The
Independent auditor's report on the report and financial statements
for the year ended 30 September 2020 was unqualified, did not draw
attention to any matters by way of emphasis, and did not contain a
statement under Section 498(2) or 498(3) of the Companies Act
2006.
2 Going concern
The interim financial information has been prepared on a going
concern basis, which assumes that the Company will have adequate
resources to continue in operational existence for the foreseeable
future.
3 Earnings per share ('EPS')
Basic earnings per ordinary share is based on the loss on
ordinary activities before taxation of GBP201,198 and on
136,354,577 ordinary shares in issue throughout the period.
Diluted profit per share is calculated by adjusting the weighted
average number of ordinary shares in issue on the assumption of
conversion of dilutive potential ordinary shares, based on the
share price at the end of the period. The Company's dilutive
potential ordinary shares are shares issued under the Company's
Enterprise Management Incentive ('EMI') scheme and options issued
under the Company's Unapproved scheme.
4 IFRS 2 'Share-based payments'
Operating expenses includes a charge of GBPnil (2020: GBP3,877)
after valuation of the Company's employee share option schemes in
accordance with IFRS 2. Under this standard, the fair value of the
options at the grant date is spread over the vesting period. These
charges have been credited to equity in accordance with IFRS2 as
presented in the consolidated statement of changes in equity.
5 Additional copies
Further copies of the 2021 interim report are available on the
Company's website, www.ish.co.uk, and from the Company's registered
office, 16-18 Hayhill Industrial Estate, Sileby Road,
Barrow-upon-Soar, Leicestershire LE12 8LD.
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END
IR KZGZDRRLGMZG
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