TIDMTRT
RNS Number : 5605F
Transense Technologies PLC
11 July 2023
The information contained within this announcement is deemed by
the Company to constitute inside information pursuant to Article 7
of EU Regulation 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 as amended.
11 July 2023
Transense Technologies plc
("Transense" or the "Company")
Year end trading update
Transense Technologies plc, the provider of specialist sensor
technology and measurement systems, is pleased to provide a trading
update for the financial year ended 30 June 2023 based on unaudited
management information.
Highlights
-- Adjusted EBITDA* for the year expected to be around GBP1.4m,
in line with market expectations (FY22: GBP0.6m)
-- Total revenue for the year increased by more than 35% to in
excess of GBP3.5m, in line with market expectations (FY22:
GBP2.6m)
o Revenues excluding iTrack royalty income ahead of management
expectations, up by 41% to exceed GBP1.5m (FY22: GBP1.1m)
o SAWsense revenue ahead of management expectations, more than
doubled to GBP0.5m (FY22: GBP0.2m)
o ITrack royalty up 30% to GBP2.0m (FY22: GBP1.6m), which was
lower than management expectations, but exit annual run rate
exceeds GBP2.3 m (FY22: GBP1.9m)
-- Cash balance maintained at GBP1.0m, despite outgoings of
GBP0.4m on share buyback programme and GBP0.2m of non-recurring
reorganisation costs
o The post year end quarterly iTrack royalty receivable in July is around GBP0.6m
Revenue, Adjusted EBITDA* & Cash
Total revenue for the year increased by more than 35% to over
GBP3.5m, which is in line with market expectations (FY22:
GBP2.6m).
The increase in the number of installed units generating royalty
income was consistent with each of the two previous years, however,
most of the growth in the current year arose in Q4 leaving the
overall total iTrack royalty income for the year short of
expectations. Significantly, far stronger than expected growth was
generated from both SAWsense and Translogik which outweighed the
royalty shortfall.
Adjusted EBITDA* is expected to be around GBP1.4m, also in line
with market expectations, and more than double the prior year level
(FY22: GBP0.6m). Profit after tax may exceed market expectations as
a consequence of an increased tax credit arising from extending the
recognition of deferred tax assets arising from prior years'
losses.
Net cash balances at 30 June 2023 amounted to GBP1.0m (FY22:
GBP1.0m). Trading continued to be cash generative, enabling the
Company to invest a further GBP0.4m in the ongoing share buyback
programme (FY22: GBP0.3m). Royalties for the final quarter of the
financial year receivable at the end of July 2023 are expected to
be around GBP0.6m, further strengthening the available cash
position of the Company.
SAWsense
Revenues were more than double those of the prior year at
GBP0.5m (FY22: GBP0.2m) from increased sales of motorsport
equipment, combined with significant new income from customer
funded feasibility and applications development projects in
aerospace and automotive electric motors and drives. In addition,
the Company realised income from claims under the Technology
Developer Accelerator Programme ("TDAP") grant announced in May
2022 of GBP0.1m (FY22: GBP 0.0m).
Business development activities have continued to generate a
healthy pipeline of new incoming enquiries, and the conversion of
these into chargeable feasibility and applications development
projects is accelerating. Recent changes in management structure,
repositioning the cost base towards customer-facing engineering and
project management specialists, gave rise to non-recurring
reorganisation costs of GBP0.2m towards the end of the financial
year. It is anticipated that these changes will deliver
productivity gains in future, enabling the business segment to
generate sufficient income to cover its own costs more quickly.
Translogik
Revenues continued to deliver annual growth above 17% and have
exceeded GBP1m for the first time (FY22: GBP0.9m). Much of this
success is attributable to our market leading product range
generating increased demand from established blue-chip customers,
reacting to market factors such as greater call for digitisation of
data and vehicle safety regulatory compliance. This leads us to
believe that increased overhead investment in business development
and marketing infrastructure, planned for FY24, will deliver rapid
results in further acceleration of market penetration through both
current and new channels to market.
iTrack Royalties
Royalty income for the financial year from iTrack in Sterling
terms increased by 30% to GBP2.0m (FY22: GBP1.6m), w hich was below
the expected growth rate of around 45 % . This ha d been signalled
during the year and was primarily due to new installations
converting late in our financial year rather than uniformly, and
most strongly in the final quarter.
The annualised run rate of royalty income exceeded GBP 2.3m by
the end of FY23, an increase of 23 % over the FY23 opening rate of
GBP1.9m per annum.
Outlook and Audited Results
The Board is pleased with the momentum in the ongoing commercial
pipeline, both for SAWsense and Translogik, which provides
confidence in the prospects for the current financial year.
Final audited results for the year ended 30 June 2023, and a
more detailed update on trading and outlook, are expected to be
announced around the end of September 2023.
*Adjusted EBITDA refers to net earnings before interest,
taxation, depreciation and amortisation adjusted for the cost of
share based payments of GBP0.1m and non-recurring reorganisation
costs of GBP0.2m.
** iTrack Royalties are based on the closing rate at 7 July
2023, however this may vary if there is a material change in rates
at the end of July 2023 when the quarterly royalties are invoiced
and paid.
For further information please visit www.transense.com or
contact:
Transense Technologies plc Via Walbrook PR
Nigel Rogers (Executive Chairman)
Melvyn Segal (CFO)
Allenby Capital (Nominated Adviser Tel: +44 (0)20 3328 5656
and Broker)
Jeremy Porter / George Payne (Corporate
Finance)
Tony Quirke/Jos Pinnington (Sales and
Corporate Broking)
Walbrook PR Tel: +44 (0)20 7933 8780
Tom Cooper / Nick Rome Transense@walbrookpr.com
Notes to Editors:
Transense is headquartered in Oxfordshire, UK and its shares are
traded on AIM, a market operated by the London Stock Exchange (AIM:
TRT). The Company develops and supplies advanced sensor technology
and measurement solutions used by some of the world's leading
companies to improve performance, efficiency and safety in
demanding, mission critical applications. Transense currently
operates through two active business segments:
-- SAWsense - designs, supplies and licences advanced sensor
solutions based on proven, patent protected Surface Acoustic Wave
(SAW) technology to world leading companies in aerospace, electric
motors and drives, industrial machinery (including robotics) and
motor sport. Key customers include GE Aerospace, Parker Meggitt,
McLaren Applied and several other confidential Tier One automotive
and aerospace suppliers.
-- Translogik - develops smart, connected commercial vehicle
tyre inspection equipment to many of the world's leading tyre
suppliers, fleet operators and service centres. That accurately
measure and digitally capture safety-critical tyre condition data,
used to reduce operating costs, improve safety and provide audit
records for regulatory compliance. Key customers include
Bridgestone, Goodyear, Continental and Prometeon (Pirelli), and
leading independent providers of vehicle fleet maintenance
management software.
Transense earns residual royalty income from iTrack - a tyre
monitoring system for off-highway vehicles that was designed,
developed and supplied by Translogik and sold under subscription to
leading global mining companies. The associated sales, support and
development infrastructure were sold to Bridgestone Corporation
Japan, the world's largest tyre producer, in June 2020, and the
intellectual property was licence exclusively to Bridgestone under
a ten-year deal expiring in 2030.
For further information please contact
transense@walbrookpr.com
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