TIDMSDI
RNS Number : 7523U
SDI Group PLC
07 December 2021
SDI Group plc
("SDI", "SDI Group", the "Company", or the "Group")
Interim results for the six months ended 31 October 2021
SDI Group plc, the AIM quoted Group focused on the design and
manufacture of scientific and technology products for use in
digital imaging and sensing and control applications, is pleased to
announce another strong set of results and solid operational
progress for the six months to 31 October 2021.
Financial Highlights
-- Revenue increased by 75% to GBP24.7m (FY21 H1: GBP14.1m), including 42% organic growth
o Continued strong contribution from Atik Cameras due to
one-time COVID-19-related contracts, expected to complete by
January 2022
o GBP4.6m sales contribution from Monmouth Scientific and
Uniform Engineering, acquired in FY21 H2
o Organic sales growth in all other businesses averaged 22%
-- Reported operating profit increased by 105% to GBP5.2m (FY21 H1: GBP2.5m)
o Adjusted operating profit* for the period increased by 82% to
GBP5.8m (FY21 H1: GBP3.2m)
-- Reported profit before tax increased by 115% to GBP5.1m (FY21 H1: GBP2.4m)
o Adjusted profit before tax* increased by 89% to GBP5.7m (FY21
H1: GBP3.0m)
-- Reported diluted EPS increased by 76% to 3.43p (FY21 H1: 1.95p)
o Adjusted diluted EPS* increased 59% to 3.92p (FY21 H1:
2.47p)
-- Cash generated from operations decreased by 6% to GBP4.4m (FY21 H1: GBP4.7m)
o Prior year included a substantial build-up of customer down
payments related to the one-time COVID-19-related contracts
-- Net cash** at 31 October 2021 of GBP1.1m (30 April 2021: GBP0.8m)
o Deferred consideration outstanding was GBPnil (30 April 2021:
GBP2.35m)
* before reorganisation costs, acquisition costs, amortisation
of acquired intangibles and share based payment costs
** cash and cash equivalents less bank finance
Operational Highlights
-- Our FY21 acquisitions of Monmouth Scientific and Uniform
Engineering have performed ahead of management's expectations and
have been fully integrated into the Group
-- On 1 November 2021, we renewed and expanded our committed
loan facility with HSBC to GBP20m, with a further accordion option
of an additional GBP10m (at the discretion of HSBC), which, with
our current net cash position and strong cash flow, provides
sufficient funding for acquisition opportunities
Ken Ford, Chairman of SDI Group, said:
"We are pleased to report yet another strong set of financial
results. SDI Group continues to execute on its business model,
investing in quality businesses that are able to grow while
generating cash. We look forward to delivering a full year
performance in line with market expectations1."
(1) Analysts from our Broker finnCap Limited and from
Progressive Equity Research regularly provide research on the
Company, and the Group considers the average of their forecasts to
represent market expectations for FY 2022 being Revenue of
GBP45.05m and Adjusted(2) Profit Before Tax of GBP9.2m
Enquiries
SDI Group plc 01223 320480
Ken Ford, Chairman
Mike Creedon, CEO
Jon Abell, CFO
www.thesdigroup.net
finnCap Ltd 020 7220 0500
Ed Frisby/Kate Bannatyne/Milesh Hindocha - Corporate Finance
Andrew Burdis/Sunila de Silva - ECM
JW Communications 07818 430877
Julia Wilson - Investor & Public Relations
About SDI Group plc:
SDI designs and manufactures scientific and technology products
for use in digital imaging and sensing and control applications
including life sciences, healthcare, astronomy, manufacturing,
precision optics and art conservation. SDI operates through its
company divisions: Atik Cameras, Synoptics, Graticules Optics,
Sentek, Astles Control Systems, Applied Thermal Control, MPB
Industries, Chell Instruments, Monmouth Scientific and Uniform
Engineering.
SDI continues to grow by developing its own technology
advancements and by improving its global sales channels, as well as
through pursuing strategic, complementary acquisitions.
www.thesdigroup.net
Chairman's statement
With the world having only partially adapted to the coronavirus
pandemic, it is pleasing to be able to report a broad-based return
to levels of activity that are higher than those we saw before it
started. All, however, is not yet calm. The businesses are cogs in
a machine that is trying to cope with changes in demand patterns
caused by the pandemic, but also by longer term upheavals including
a focus on healthcare, technological advancement, climate change
and Brexit.
I am more convinced than ever that SDI's business model,
involving smaller niche businesses operating with a high degree of
autonomy in technical, scientific and medical and life science
market segments, offers a route to sustained value creation, and
allows us to respond rapidly to events.
Trading
Our larger OEM customers have been ordering at good levels for
some time now, with strong demand in healthcare, beverage can
production and automotive racing in particular. Interest from
customers for new products to be designed in and for capital
equipment purchases for general laboratory use has remained
subdued, although the restarting of trade fairs and exhibitions
suggests that this too will bounce back now. Service activity is
still hampered by travel restrictions but has lately been
improving.
Supply chain issues have become a drain on management time, and
our businesses are having to work hard to source components, modify
designs for missing ones, and also to adapt to customer demand
changes. However, they are managing well.
The subsidiaries all worked hard to adapt to the changes in the
half year, which was appreciated by the Board, and, I am sure, by
shareholders.
Revenues
Group revenues increased by 75% to GBP24.7m (FY21 H1: GBP14.1m).
The increase was driven by 3 major factors:
- Our Atik Cameras business continued to deliver, at a higher
rate than in previous periods, cameras for use by a global OEM in
RT PCR machines, which are (amongst other uses) the gold standard
instrument for COVID-19 testing. We expect current orders, paid for
in advance of shipment, to be fulfilled by January 2022, and we
have no visibility of further orders.
- The businesses we acquired in FY21 H2, Monmouth Scientific and
Uniform Engineering, delivered GBP4.6m of sales, which was ahead of
our expectations.
- Our other businesses performed very well, recording
collectively 22% sales growth compared with FY21 H1, which was of
course affected by pandemic-related reductions in customer
purchases. All of these businesses have rebounded substantially,
with the exception of the ventilator-related sales at MPB
industries.
Organic revenue growth across the business was 42%. Compared
with the same period of two years ago, FY20 H1, sales of those
businesses in the Group at the time have increased by 59%.
Excluding the exceptional 218% growth at Atik Cameras, all of those
businesses have grown, at an average two-year growth of 16%.
Sales in our Digital Imaging segment grew by 64% to GBP11.4m
(FY21 H1: GBP6.9m) and sales in Sensors & Control were 85%
higher at GBP13.3m (FY21 H1: GBP7.2m).
Profits
Gross margin was lower than in FY21 H1, due essentially to the
evolution of product mix, including the effect of below-average
margins at Monmouth Scientific (acquired in FY21 H2) and on the
Atik Camera orders. We have had to increase prices to offset the
impacts of both labour cost increases and component and raw
material price increases across the Group, and generally we have
seen customer acceptance of this.
Overheads are higher than the comparative period which benefited
from furlough receipts and from a virtual stop to travel costs, but
we are seeing the benefit of efficiency gains realised over the
past year.
Group profit before tax increased by 115% to GBP5.1m (FY21 H1:
2.4m), driven by the organic revenue growth and the contribution of
the FY21 H2 acquired businesses.
Our tax charge has increased by 288% to GBP1.5m (FY21 H1:
GBP0.4m), essentially due to a GBP0.6m charge to align certain
deferred tax assets and liabilities (except for deferred tax assets
related to share options) to the new UK corporate tax rate of 25%
from April 2023. A GBP0.3m favourable impact from aligning the
deferred tax asset for future share option gains to current share
prices and tax rates has been booked directly to equity.
In addition to the GAAP results, the Group also provides
adjusted results in which certain one-time and non-cash charges are
excluded, to help shareholders understand the underlying operating
performance. Adjusted profit before tax increased by 90% to GBP5.7m
(FY21 H1: GBP3.0m). Adjustments for the period were for the
amortisation of acquired intangible assets and for share based
payments totalling GBP0.6m (FY21 H1: GBP0.5m). No
acquisition-related costs or reorganisation costs were recorded in
the period (FY21 H1: GBP0.1m of reorganisation expense).
Basic earnings per share increased by 78% from 2.03p to 3.61p;
diluted earnings per share increased by 76% to 3.43p (FY21 H1:
1.95p). Adjusted diluted EPS increased by 59% to 3.92p (FY21 H1:
2.47p).
Cash flow
Cash generated from operations reduced by 6% to GBP4.4m (FY21
H1: GBP4.7m). The very strong cash flow of the previous year was
strongly influenced by the build-up of advanced payments for the
COVID-19-related orders at Atik Cameras (as reported at the time).
In the current period, these have reduced by about GBP1.1m, with
consequent reduction to cash flow. The remaining GBP1.8m is
expected to unwind in the remaining months of the year as the
orders are shipped.
During this period, we paid the deferred consideration element
of GBP2.35m on the acquisition of Monmouth Scientific.
Net cash, or cash less bank debt, increased to GBP1.1m at 31
October 2021 from GBP0.8m at 30 April 2021.
On 01 November 2021, directly following the period end, we
renewed and expanded our committed loan facility with HSBC to
GBP20m, with a further accordion option of an additional GBP10m (at
the discretion of HSBC), which, with our current net cash position
and strong cash flow, provides sufficient funding for acquisition
opportunities. The new facility has been tailored to our business
model with fewer restrictions on acquisitions and allows for higher
leverage if necessary.
Operations
This half year has been a challenging one for our operations
teams, with relatively short-term changes in customer demand,
usually upwards but also impacted by customers' ability to source
other key components, and with upstream shortages of our own
components and materials. Significant management time has been
expended in negotiating additional supplies and finding alternative
sources or designing in substitute components. We expect this
situation to endure for some time, and we have also increased
purchases in many cases to secure key inputs.
Labour availability has been less of a problem, with generally
low turnover as usual, but some vacancies taking time to fill.
We are seeing cost increases in both material and labour, but we
are generally able to pass these on to customers.
As part of a rolling programme of upgrading facilities, we have
been investing in an upgrade and capacity expansion at Graticules
Optics to create a modern factory that is able to expand into new
areas and have made further investments at Uniform Engineering for
efficiency, capacity and quality. We have been strengthening the
Portugal-based team at Atik Cameras so that they can directly
handle all day-to-day interaction with the global customer-base,
leaving Norwich as the centre of excellence for product
development, marketing and new business.
Our business units have only recently started to attend and
exhibit at trade fairs and exhibitions after a difficult period of
demonstrating and marketing products via videoconference. Design-in
activity with OEM customers is also picking up again, whereas
research and development has continued throughout the pandemic
period within our business units.
Acquisitions
No major acquisition took place in the period, but in August
2021, we purchased the Clean Tent trade and assets from Moorfield
Technology, for a cash consideration of GBP150,000, which was
integrated into Monmouth Scientific. Clean Tents are portable and
temporary cleanroom facilities, which are complementary to the
Monmouth Scientific range and we are very pleased with this
purchase.
The Group continues to look for complementary acquisitions
fitting our criteria, and we would hope to close at least one in
the financial year.
Outlook
As we have previously disclosed, we expect sales and therefore
profit in the second half of the year to be lower than in the first
half, as the COVID-19-related orders at Atik have been mostly
completed. Apart from this, we expect a continuation of favourable
trading conditions seen in the first half and look forward to
delivering a full year performance in line with market
expectations.
Ken Ford, Chairman
6 December 2021
Consolidated income statement
Unaudited for the six months ended 31 October 2021
6 months 6 months 12 months
to to to
31 October 31 October 30 April
2021 2020 2021
Note Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------- ------------ ------------ ----------
Revenue 24,655 14,126 35,076
----------
Costs of sales (8,783) (4,724) (12,206)
------------------------ ------------ ------------ ----------
Gross Profit 15,882 9,402 22,870
----------
Other operating income 20 7 21
----------
Operating expenses (10,695) (6,874) (16,960)
----------
Operating profit 5,207 2,535 5,931
----------
Net financing expense (105) (164) (287)
------------------------ ------------ ------------ ----------
Profit before taxation 5,102 2,371 5,644
----------
Income tax charge 8 (1,526) (393) (936)
------------------------ ------------ ------------ ----------
Profit for the period 3,576 1,978 4,708
------------------------ ------------ ------------ ----------
Earnings per share 5
----------
Basic earnings per
share 3.61p 2.03p 4,81p
----------
Diluted earnings per
share 3.43p 1.95p 4.58p
------------------------ ------------ ------------ ----------
Consolidated statement of comprehensive income
Unaudited for the six months ended 31 October 2021
6 months to 6 months to 12 months to
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------- ------------ ------------ -------------
Profit for the period 3,576 1,978 4,708
-------------
Other comprehensive income
-------------
Exchange differences
on translating foreign
operations (161) 48 (96)
----------------------------- ------------ ------------ -------------
Total comprehensive profit
for the period 3,415 2,026 4,612
----------------------------- ------------ ------------ -------------
Consolidated balance sheet
Unaudited at 31 October 2021
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
Note GBP'000 GBP'000 GBP'000
------------------------------- ----- ----------- ----------- ---------
Assets
---------
Non-current assets
---------
Intangible assets 25,730 21,110 26,237
Property, plant and equipment 4,225 3,584 4,131
Deferred tax asset 8 1,660 219 1,697
------------------------------- ----- ----------- ----------- ---------
31,615 24,913 32,065
Current assets
Inventories 6,957 4,087 6,059
Trade and other receivables 7,786 4,456 6,743
Cash and cash equivalents 3,513 3,436 3,836
------------------------------- ----- ----------- ----------- ---------
18,256 11,979 16,638
------------------------------- ----- ----------- ----------- ---------
Total assets 49,871 36,892 48,703
------------------------------- ----- ----------- ----------- ---------
Liabilities
---------
Non-current liabilities
---------
Borrowings 6 1,029 2,400 1,714
---------
Lease liabilities 6 1,936 2,211 2,050
---------
Deferred tax liability 8 2,993 2,037 2,479
------------------------------- ----- ----------- ----------- ---------
5,958 6,648 6,243
------------------------------- ----- ----------- ----------- ---------
Current liabilities
---------
Trade and other payables 9,727 5,412 12,826
---------
Provisions 230 85 230
---------
Borrowings 6 1,371 1,371 1,371
---------
Lease liabilities 6 498 562 509
---------
Current tax payable 1,165 510 750
------------------------------- ----- ----------- ----------- ---------
12,991 7,940 15,686
---------
Total liabilities 18,949 14,588 21,929
------------------------------- ----- ----------- ----------- ---------
Net assets 30,922 22,304 26,774
------------------------------- ----- ----------- ----------- ---------
Equity
---------
Share capital 996 978 984
Merger reserve 2,606 2,606 2,606
Merger relief reserve 424 424 424
Share premium account 9,359 8,805 9,092
Share-based payment reserve 728 619 714
Foreign exchange reserve (76) 229 85
Retained earnings 16,885 8,643 12,869
------------------------------- ----- ----------- ----------- ---------
Total equity 30,922 22,304 26,774
------------------------------- ----- ----------- ----------- ---------
Consolidated statement of cash flows
Unaudited for the six months ended 31 October 2021
6 months 6 months 12 months
to to to
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
Note GBP'000 GBP'000 GBP'000
---------------------------------------- ----- ------------ ------------ ----------
Operating activities
----------
Net profit for the period 3,577 1,978 4,708
Depreciation and amortisation 1,315 1,096 2,562
Finance costs and income 105 164 287
Impairment of intangibles - 18 130
Changes in provisions - - (15)
Taxation expense in the income
statement 1,526 393 936
Employee share-based payments 159 152 305
---------------------------------------- ----- ------------ ------------ ----------
Operating cash flow before movement
in working capital 6,682 3,801 8,913
Changes in inventories (886) (400) (977)
Changes in trade and other receivables (573) (745) (2,363)
Changes in trade and other payables (808) 2,059 6,137
---------------------------------------- ----- ------------ ------------ ----------
Cash generated from operations 4,415 4,715 11,710
Interest paid (105) (164) (287)
Income taxes paid (735) (493) (1,166)
---------------------------------------- ----- ------------ ------------ ----------
Cash generated from operating
activities 3,575 4,058 10,257
Cash flows from investing activities
Capital expenditure on fixed
assets (510) (109) (667)
Sale of property plant and equipment 32 - 67
Expenditure on development and
other intangibles (115) (116) (367)
Acquisition of subsidiaries,
net of cash 7 (2,500) - (4,057)
Net cash used in investing activities (3,093) (225) (5,024)
Cash flows from financing activities
Payments of lease liabilities (296) (224) (489)
Proceeds from bank borrowings - - 5,404
Repayment of borrowings (686) (5,562) (11,652)
Issues of shares & proceeds
from option exercises 278 - 155
---------------------------------------- ----- ------------ ------------ ----------
Net cash (used in)/from financing
activities (704) (5,786) (6,582)
---------------------------------------- ----- ------------ ------------ ----------
Net (decrease)/increase in cash
and cash equivalents (222) (1,953) (1,349)
Cash and cash equivalents, beginning
of period 3,836 5,290 5,290
Foreign currency movements on
cash balances (101) 99 (105)
---------------------------------------- ----- ------------ ------------ ----------
Cash and cash equivalents, end
of period 3,513 3,436 3,836
---------------------------------------- ----- ------------ ------------ ----------
Consolidated statement of changes in equity
Unaudited for the six months ended 31 October 2021
6 months to 31 October
2021 - unaudited Merger Share-based
Share Merger relief Foreign Share payment Retained
capital reserve reserve exchange premium reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Balance at 1 May 2021 984 2,606 424 85 9,092 714 12,869 26,774
Shares issued 12 - - - 267 - - 279
Tax in respect to
share options - - - - - - 295 295
Share-based payments
transfer - - - - - (145) 145 -
Share based payments - - - - - 159 - 159
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Transactions with
owners 12 - - - 267 14 440 733
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Profit for the period - - - - - - 3,576 3,576
Foreign exchange on
consolidation of
subsidiaries - - - (161) - - - (161)
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Total comprehensive
income for the period - - - (161) - - 3,576 3,415
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Balance at 31 October
2021 996 2,606 424 (76) 9,359 726 16,885 30,922
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
6 months to 31 October
2020 - unaudited Merger Share-based
Share Merger relief Foreign Share payment Retained
capital reserve reserve exchange premium reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Balance at 1 May 2020 975 3,030 - 181 8,746 467 6,665 20,064
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Shares issued 3 - - - 59 - - 62
Share based payments - - - - - 152 - 152
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Transactions with
owners 3 - - - 59 152 - 214
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Profit for the period - - - - - - 1,978 1,978
Foreign exchange on
consolidation of
subsidiaries - - - 48 - - - 48
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Total comprehensive
income for the period - - - 48 - - 1,978 2,026
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
Balance at 31 October
2020 978 3,030 - 229 8,805 619 8,643 22,304
----------------------- --------- --------- ---------- ---------- --------- ------------ ---------- ----------
12 months to 30 April
2021 - audited Merger Share-based
Share Merger relief Foreign Share payment Retained
capital reserve reserve exchange premium reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ --------- --------- ---------- ---------- --------- ------------ ---------- ---------
Balance at 30 April
2020 975 3,030 - 181 8,746 467 6,665 20,064
Restatement - (424) 424 - - - - -
Adjusted balances
at 30 April 2020 975 2,606 424 181 8,746 467 6,665 20,064
------------------------ --------- --------- ---------- ---------- --------- ------------ ---------- ---------
Shares issued 9 - - - 346 - - 355
Tax in respect to
share options - - - - - - 1,438 1,438
Share-based payments
transfer - - - - - (58) 58 -
Share based payments - - - - - 305 - 305
Transactions with
owners 9 - - - 346 247 1,496 2,098
------------------------ --------- --------- ---------- ---------- --------- ------------ ---------- ---------
Profit for the year - - - - - - 4,708 4,708
---------
Foreign exchange on
consolidation of
subsidiaries - - - (96) - - - (96)
------------------------ --------- --------- ---------- ---------- --------- ------------ ---------- ---------
Total comprehensive
income - - - (96) - - 4,708 4,612
------------------------ --------- --------- ---------- ---------- --------- ------------ ---------- ---------
Balance at 30 April
2021 984 2,606 424 85 9,092 714 12,869 26,774
------------------------ --------- --------- ---------- ---------- --------- ------------ ---------- ---------
Notes to the interim financial statements
1. General information and basis of preparation
SDI Group plc (formerly known as Scientific Digital Imaging plc
(the "Company")), a public limited company, is the Group's ultimate
parent. It is registered in England and Wales. The consolidated
interim financial statements of the Company for the period ended 31
October 2021 comprise the Company and its subsidiaries (together
referred to as the "Group").
The unaudited consolidated interim financial statements are for
the six months ended 31 October 2021. These interim financial
statements have been prepared using the recognition and measurement
principles of International Accounting Standards in conformity with
the requirements of the Companies Act 2006. The consolidated
interim financial information has been prepared under the
historical cost convention, as modified by the recognition of
certain financial instruments at fair value. The consolidated
interim financial statements are presented in British pounds (GBP),
which is also the functional currency of the ultimate parent
company.
The consolidated interim financial information was approved by
the Board of Directors on 6 December 2021
The financial information set out in this interim report does
not constitute statutory accounts as defined in section 435 of the
Companies Act 2006. The figures for the year ended 30 April 2021
have been extracted from the statutory financial statements of SDI
Group plc which have been filed with the Registrar of Companies.
The auditor's report on those financial statements was unqualified
and did not contain a statement under section 498(2) or 498(3) of
the Companies Act 2006. The financial information for the six
months ended 31 October 2021 and for the six months ended 31
October 2020 has not been audited.
2. Principal accounting policies
The principal accounting policies adopted in the preparation of
the condensed consolidated interim information are consistent with
those followed in the preparation of the Group's financial
statements for the year ended 30 April 2021.
The accounting policies have been applied consistently
throughout the Group for the purposes of preparation of these
interim financial statements.
3. Alternative Performance Measures
The Group uses Adjusted Operating Profit, Adjusted Profit Before
Tax, Adjusted Diluted EPS and Net Operating Assets as supplemental
measures of the Group's profitability and investment in business
related assets, in addition to measures defined under IFRS. The
Group considers these useful due to the exclusion of specific items
that are considered to hinder comparison of underlying
profitability and investments of the Group's segments and
businesses and is aware that shareholders use these measures to
evaluate performance over time. The adjusting items for the
alternative measures of profit are either recurring but non-cash
charges (share-based payments and amortisation of acquired
intangible assets) or exceptional items (reorganisation costs and
acquisition costs).
The following table is included to define the term Adjusted
Operating Profit:
6 months 6 months 12 months
to to to
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------- ------------ ------------ ----------
Operating Profit (as reported) 5,207 2,535 5,931
----------
Adjusting items (all costs):
----------
Non-underlying items
----------
Share based payments 159 152 305
----------
Amortisation of acquired intangible
assets 465 379 1,153
----------
Exceptional items
----------
Reorganisation costs - 129 132
----------
Acquisition and fundraising costs - - 179
------------------------------------- ------------ ------------ ----------
Total adjusting items within
Operating Profit 624 660 1,769
----------
Adjusted Operating Profit 5,831 3,195 7,700
------------------------------------- ------------ ------------ ----------
Adjusted Profit Before Tax is defined as follows:
6 months 6 months 12 months
to to to
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------------- ------------ ------------ ----------
Profit Before Tax (as reported) 5,102 2,371 5,644
------------
Adjusting items (as above) 624 660 1,769
------------
Adjusted Profit Before Tax 5,726 3,031 7,413
--------------------------------- ------------ ------------ ----------
3. Alternative Performance Measures (continued)
Adjusted EPS is defined as follows:
6 months 6 months 12 months
to to to
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------- ------------ ------------ ------------
Profit for the Period (as reported) 3,576 1,978 4,708
------------
Adjusting items (as above) 624 660 1,769
------------
Less: taxation on adjusting
items calculated at the UK
statutory rate (119) (125) (336)
------------ ------------ ------------
Adjusted profit for the period 4,081 2,513 6,141
------------
Divided by diluted weighted
average number of shares in
issue (Note 5) 104,138,768 101,611,426 102,799,084
------------
Adjusted Diluted EPS 3.92p 2.47p 5.97p
------------------------------------- ------------ ------------ ------------
Net Operating Assets is defined as follows:
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
-------------------------------------- ----------- ----------- ---------
Net Assets 30,922 22,304 26,774
---------
Deferred tax asset 1,660 219 1,697
---------
Corporation tax asset 486 79 17
---------
Cash and cash equivalents 3,513 3,436 3,836
---------
Borrowings (current and non-current) (4,834) (6,544) (5,644)
---------
Deferred consideration - - (2,350)
---------
Deferred tax liability (2,993) (2,037) (2,479)
---------
Current tax payable (1,165) (510) (750)
-------------------------------------- ----------- ----------- ---------
Total adjusting items within
Net Assets (3,333) (5,357) (5,673)
---------
Net Operating Assets 34,255 27,661 32,447
-------------------------------------- ----------- ----------- ---------
4. Segmental analysis
6 months 6 months 12 months
to to to
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------- ------------ ------------ ----------
Revenues
----------
Digital Imaging 11,373 6,940 15,778
----------
Sensors & Control 13,292 7,186 19,288
----------
Group 24,665 14,126 35,076
----------
Adjusted Operating Profit
----------
Digital Imaging 4,253 2,075 5,165
----------
Sensors & Control 2,505 1,569 4,360
----------
Other (927) (449) (1,825)
------------------------------------- ------------ ------------ ----------
Group 5,831 3,195 7,700
----------
Amortisation of acquired intangible
assets
----------
Digital Imaging (92) (92) (175)
----------
Sensors & Control (377) (291) (978)
----------
Group (469) (383) (1,153)
----------
Adjusted Operating Profit has been defined in Note 3.
Analysis of amortisation of acquired intangible assets has been
included separately as the Group considers it to be an important
component of profit which is directly attributable to the reported
segments.
The Other category includes costs which cannot be allocated to
the other segments and consists principally of Group head office
costs.
4. Segmental analysis (continued)
31 October 31 October 30 April
2021 2020 2021
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------- ----------- ----------- ---------
Operating Assets excluding acquired
intangible assets
---------
Digital Imaging 9,612 6,942 7,895
---------
Sensors & Control 9,757 5,825 9,683
---------
Other (257) 331 131
------------------------------------- ----------- ----------- ---------
Group 19,112 13,098 17,709
---------
Acquired intangible assets
---------
Digital Imaging 5,107 5,282 5,195
---------
Sensors & Control 19,978 14,777 20,251
---------
Group 25,085 20,059 25,446
---------
Operating Liabilities
---------
Digital Imaging (4,650) (3,051) (5,439)
---------
Sensors & Control (4,192) (2,200) (4,204)
---------
Other (1,101) (245) (1,064)
------------------------------------- ----------- ----------- ---------
Group (9,943) (5,496) (10,707)
---------
Net Operating Assets
---------
Digital Imaging 10,069 9,173 7,650
---------
Sensors & Control 25,543 18,402 25,731
---------
Other (1,357) 86 (934)
------------------------------------- ----------- ----------- ---------
Group 34,255 27,661 32,447
------------------------------------- ----------- ----------- ---------
Net operating assets has been defined in Note 3.
5. Earnings per share
The calculation of the basic earnings per share is based on the
profits attributable to the shareholders of SDI Group plc divided
by the weighted average number of shares in issue during the
period. All profit per share calculations relate to continuing
operations of the Group.
Profit
attributable Weighted Earnings
to average per share
shareholders number of amount in
GBP'000 shares pence
----------------------------- -------------- ------------ -----------
Basic earnings per share:
-----------
Period ended 31 October
2021 3,576 99,120,392 3.61
-----------
Period ended 31 October
2020 1,978 97,582,755 2.03
-----------
Year ended 30 April 2021 4,708 97,852,313 4.81
-----------
Dilutive effect of share
options :
-----------
Period ended 31 October
2021 5,018,376
-----------
Period ended 31 October
2020 4,028,671
-----------
Year ended 30 April 2021 4,946,771
-----------
Diluted earnings per share:
-----------
Period ended 31 October
2021 3,576 104,138,768 3.43
-----------
Period ended 31 October
2020 1,978 101,611,426 1.95
-----------
Year ended 30 April 2021 4,708 102,799,084 4.58
----------------------------- -------------- ------------ -----------
6. Borrowings
31 October 31 October 30 April
2021 2020 2021
GBP'000 GBP'000 GBP'000
-------------------------------- ----------- ----------- ---------
Within one year:
Bank finance 1,371 1,371 1,371
Leases 498 562 509
1,869 1,933 1,880
-------------------------------- ----------- ----------- ---------
After one year and within five
years:
Bank finance 1,029 2,400 1,714
Leases 1,065 1,297 2,050
-------------------------------- ----------- ----------- ---------
2,094 3,697 3,764
-------------------------------- ----------- ----------- ---------
After more than five years:
-------------------------------- ----------- ----------- ---------
Leases 871 914 -
-------------------------------- ----------- ----------- ---------
Total borrowings 4,834 6,544 5,644
-------------------------------- ----------- ----------- ---------
Bank finance relates to amounts drawn down under the Group's
bank facility with HSBC Bank plc, which is secured against all
assets of the Group.
On 01 November, directly after the period end, the Group agreed
a new GBP20m revolving loan facility with HSBC, committed for 3
years, with covenants relating to leverage (net debt to EBITDA) and
interest coverage. The GBP2,400,000 of short term and long-term
bank finance shown above was transferred to the new facility.
7. Acquisitions
During the previous financial year, the Group completed the
acquisition of Monmouth Scientific Limited for which contingent
consideration of GBP2.35 million was outstanding at 30 April 2021.
This amount was settled in cash in the current period.
On 12 August 2021, Monmouth Scientific acquired the trade and
assets of the Clean Tent business, for a cash consideration of
GBP150,000.
8. Taxation
The Group has estimated an effective tax rate of 18.1% for the
year and has applied this rate to the profit before tax for the
period. The Group has further booked a charge of GBP597,000 to
align certain deferred tax assets and liabilities to the new
statutory tax rate of 25% enacted for periods from March 2023. A
gain of GBP295,000 resulting from changes to the estimate of future
tax relief from share option exercises, including the estimated
effect of changes in the tax rate, has been booked directly to
equity.
SDl Group plc
Beacon House
Nuffield Road
Cambridge
CB4 1TF
UK
Telephone: +44 (0)1223 727144
Fax: +44 (0)1223 727101
Email: info@thesdigroup.net
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END
IR UPGUPPUPGPGQ
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