TIDMSCE
RNS Number : 4226E
Surface Transforms PLC
28 February 2020
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
28 February 2020
Surface Transforms plc.
("Surface Transforms" or the "Company")
Unaudited interim results for the six months ended 30 November
2019
Surface Transforms (AIM: SCE) manufacturers of carbon fibre
reinforced ceramic materials, announces its unaudited interim
results for the six months ended 30 November 2019.
As previously reported, the Company has changed its accounting
year-end date to 31 December. To assist with the transition this
six-month statement also includes certain unaudited results for the
seven months to 31 December 2019. The full audited results and
report for the seven-month period to 31 December 2019 will be
issued on 30 March 2020.
Financial highlights (seven months ended 31 December 2019)
-- Revenue increased 183% to GBP1,451k (7 months to 31 December 2018: GBP512k).
-- Gross profit increased to GBP868k, representing a gross margin of 60%
-- Cash at 31 December 2019 was GBP770k (31 December 2018: GBP319k)
Financial highlights (six months ended 30 November 2019)
-- Revenue increased 102% to GBP1,029k (H1-2018: GBP509k)
-- Gross profit in the six month period increased 95% to GBP630k (H1-2018: GBP322k)
-- Loss before and after tax in the six month period decreased to GBP1,302k (H1-2018: GBP1,509k)
-- Capital expenditure on property, plant and equipment of
GBP582k (H1-2018: GBP144k) mainly related to the installation of
Production OEM Cell One
-- Inventory at 30 November 2019 was GBP1,120k (31 May 2019: GBP1,162k)
Sales and Operational highlights
-- Secured an EUR11.8m contract over seven years from major
German automotive OEM 5 with start of production ("SOP") in October
2021. Discussions continue regarding follow on business
-- Further SOP delays of contracts with British automotive customer OEM 6
-- Won and delivered a GBP400k contract with OEM 1, another
British automotive customer. Discussions continue regarding follow
on business
-- Continued progress on testing for OEM 3
-- Received full regulatory approval from the Environmental Agency for the Knowsley site
Financial Review
Revenue in the seven months to 31 December 2019 increased to
GBP1,451k (seven months to 31 December 2018: GBP512k) in part due
to the GBP400k order from OEM 1, whilst the Company is also pleased
to report increases in near OEM sales, which we believe to be
sustainable. Sales for the six months to November 2019 were
GBP1,029k (H1-2018: GBP509k). The high sales in December 2019
reflected the production catch up situation on near OEM and
aftermarket sales as the prior months of September and November had
been devoted to the OEM 1 order.
Gross profit in the seven months to 31 December 2019 increased
to GBP868k whilst for six months period to 30 November 2019,
increased to GBP630k (H1-2018: GBP322k). Gross profit margin was
61% (H1-2018: 63%) but is expected to improve in 2020 as OEM
Production Cell One cost reductions come on stream.
The Company has adopted IFRS 16 in the period, capitalising
operating leases. The major lease for the Company is the rent on
the Knowsley site; all other leases are minimal. The major impact
of IFRS 16 on the Company's financial statements, is on the Balance
Sheet creating right of use assets totalling GBP1.5m together with
corresponding liabilities. The impact on the Income Statement is to
exchange a reduction in the rent (hitherto treated as an expense)
for an increase in interest and depreciation. In the six months to
30 November 2019 this added a net GBP29k to the loss for the year
before and after tax. These IFRS 16 adjustments have no impact on
cash. To facilitate comparison, the 2018 comparatives have been
restated to reflect the impact of IFRS 16 had it been applied in
that period as well.
Administrative expenses rose by GBP134k to GBP864k (H1-2018:
GBP730k) largely driven by above budget plant repair costs of
GBP66k, certification and consultancy costs of GBP45k to achieve
environmental agency approval together with the introduction of
IFRS 16. The certification costs will not recur.
Research expenses increased to GBP1,294k (H1-2018: GBP1,068k) of
which the major elements were significant increases in the number
of prototypes being tested along with development of the furnace
process in support of cost reduction.
Cash at 31 December 2019 was GBP770k (December 2018: GBP319k),
to which can be added GBP425k customer payments received in the
first week of January; the corresponding cash balance at the end of
the half-year was GBP81k (31 May 2019: GBP1,925k). Both periods
were impacted by a combination of extended customer credit terms
and subsequent late payment. The significant cash inflow in
December and January reflected payment of these overdue sums and
December receipt of the R&D tax credit. Inventory reduction was
less than planned in 2019 but is expected to reduce further during
2020.
Loss per share was 0.96p (H1-2018: 1.24p).
Progress with potential OEM Customers
The Company continues to test products with customers as
described in previous announcements and still expects to make
further contract announcements during 2020:
OEM 5 : In the period the Company was notified of its selection
as a tier one supplier of a carbon ceramic disc to the major German
automotive Company OEM 5. The selection is to be the sole supplier
of the brake disc option on one axle of a new model. Lifetime
revenue on this car is estimated to be EUR11.8m commencing late
2021. Annual revenue is estimated to be EUR2.0m per year before
tapering off during 2026.
In addition, whilst this selection is the first with German OEM
5 the commercial understanding embraces the opportunity to be
selected for further multiple platforms in the customer's portfolio
over time - pricing has been agreed providing a link between
increasing volumes and decreasing unit prices. These potential
awards could generate revenues of many times the value of this
first contract.
The customer is now completing the system integration tasks
required to bring the car into production. This work is proceeding
to plan.
OEM 6 : Notwithstanding recent customer announcements on the SOP
of future models relevant to Surface Transforms, the Company is
maintaining guidance on overall timing of Company revenues. On the
first contract we won with them in 2017 the customer now expects to
enter production in the summer of 2020; however this delay had been
anticipated by the Company and is already reflected in the
Company's previously announced assumptions and revenue
guidance.
Similarly the customer has announced SOP delays on the second
car on which Surface Transforms is a nominated supplier from the
fourth quarter of 2021 to the second half of 2022. Again, the
Company had previously included a general overall delay contingency
to provide against any such risk.
OEM 1 : In the period the Company both received and delivered a
GBP400k order for carbon ceramic discs on a track car to a major
high performance British automotive Company.
The Company is in discussions with the customer on further
opportunities.
OEM 3 : Work continues on the product enhancements to meet the
customer's unique environmental test. Progress has been good with
particular focus on ensuring that a capable production process
matches the development activities. The Company is now in
discussions on whether this enhanced product is sufficiently
advanced for approval by OEM 3 for nomination on particular future
programmes, in parallel to continuing further process improvement
to widen the potential for nominations.
Other OEMs . The Company continues constructive discussions with
a number of other OEMs, some of whom are now testing our product
for the first time.
Knowsley Facility
OEM Production Cell One : All the new furnaces have now
demonstrated functional capability and, indeed, some are being used
to contribute to Small Volume Cell production output, thereby
taking advantage of superior technology and lower production costs.
The key task over the next few months is to demonstrate full
systems integration of all the machines in the cell.
Environmental permits : The Company has now received full
regulatory approval from the Environmental Agency for all
technologies, including furnaces, on the Knowsley site.
2019 production surge : The success in delivering the GBP400k
order for OEM 1 in a very limited period was a significant
achievement by the, relatively new, operations team. Apart from the
obvious customer relationship and financial benefits arising from
this order, the "production surge" was a very valuable learning
experience for us in respect to both the Company's internal
processes and supply chain. Where weaknesses were exposed, remedial
actions have either been addressed or are in advanced stages of
consideration.
Cost reductions : The Company continues to see continuous
reduction in manufacturing cost as a crucial key ingredient of
future success in the automotive industry. When OEM Production Cell
One goes live in 2020, the Company will have achieved its original
plan to halve production costs. The Company will not rest on this
milestone with further cost reduction initiatives under active
consideration.
Outlook
There are no changes to overall revenue guidance. Whilst OEM 6
has announced a number of changes to SOP on important cars for the
Company, these changes had been broadly anticipated in internal
forecasts.
The Board continues to expect gross margin percentages and
overheads to be in line with previous guidance. However, the
adoption of IFRS 16 will increase previously stated forecast losses
by approximately GBP48k in 2020, GBP44k in 2021, and GBP39k in
2022. These IFRS 16 adjustments have no impact on cash.
Summary
Surface Transforms continues its journey from a development
company to a mainstream volume automotive supplier with a site
capable of revenues of GBP50m per year in a market that could
ultimately reach GBP2 billion.
The Board maintains previous guidance that, with the recent
awards of multi year, multi million revenue contracts, the Company
will reach break-even EBITDA (including the tax credit) in H2 2020,
positive EBITDA (including the tax credit) in 2021 and profit
before tax in 2022.
In 2020 we expect to build on this foundation by winning further
contracts, completing the system integration of OEM Production Cell
One and begin delivering both production and development parts on
the new contracts.
Finally, may I conclude by recording the Board's appreciation of
the outstanding contribution by all members of staff. Thank
You!
David Bundred
Chairman
For enquiries, please contact:
Surface Transforms plc.
Kevin Johnson, CEO +44 151 356 2141
Michael Cunningham CFO
David Bundred, Chairman
Cantor Fitzgerald Europe (Nomad & Joint-Broker) +44 20 7894 7000
David Foreman / Michael Boot / Adam Dawes (Corporate
Finance)
Caspar Shand-Kydd / Maisie Atkinson (Sales)
finnCap Ltd (Joint-Broker) +44 20 7220 0500
Ed Frisby / Giles Rolls (Corporate Finance)
Richard Chambers (Corporate Broking)
For further Company details, visit www.surfacetransforms.com
Statement of Total Comprehensive Income
RESTATED RESTATED
Seven
Six Months Months Six Months Year
Ended Ended Ended Ended
30-Nov-19 31-Dec-19 30-Nov-18 31-May-19
GBP'000 GBP'000 GBP'000 GBP'000
Unaudited Unaudited Unaudited Unaudited
------------------------------------- ----------- ---------- ----------- ----------
Revenue 1,029 1,451 509 1,002
Cost of Sales (399) (583) (187) (385)
------------------------------------- ----------- ---------- ----------- ----------
Gross Profit 630 868 322 617
Administrative Expenses:
Before research and development
costs (864) (1,063) (730) (1,514)
Research and development costs (1,294) (1,502) (1,055) (2,039)
------------------------------------- ----------- ---------- ----------- ----------
Total administrative expenses (2,158) (2,566) (1,785) (3,553)
------------------------------------- ----------- ---------- ----------- ----------
Other operating income
------------------------------------- ----------- ---------- ----------- ----------
Operating loss before non recurring
items (1,528) (1,698) (1,463) (2,936)
Non-recurring items 0 0 (3) 0
Financial Income 1 1 1 2
Financial Expenses (49) (63) (44) (96)
------------------------------------- ----------- ---------- ----------- ----------
Loss before tax (1,576) (1,760) (1,509) (3,030)
Taxation 274 443 0 921
------------------------------------- ----------- ---------- ----------- ----------
Loss for the year after tax (1,302) (1,317) (1,509) (2,109)
Total comprehensive loss for the
year attributable to members (1,302) (1,317) (1,509) (2,109)
------------------------------------- ----------- ---------- ----------- ----------
Loss per ordinary share
Basic and diluted (0.96)p (0.97)p (1.24)p (1.68)p
------------------------------------- ----------- ---------- ----------- ----------
Statement of Financial Position
RESTATED RESTATED
Seven
Six Months Months Six Months Year
Ended Ended Ended Ended
30-Nov-19 31-Dec-19 30-Nov-18 31-May-19
GBP'000 GBP'000 GBP'000 GBP'000
Unaudited Unaudited Unaudited Unaudited
------------------------------------- ----------- ---------- ----------- ----------
Non-current Assets
Property, plant and equipment 4,356 4,336 4,069 3,921
Right of use assets 1,190 1,182 1,290 1,239
Intangibles 173 175 218 202
------------------------------------- ----------- ---------- ----------- ----------
5,719 5,694 5,577 5,362
Current assets
Inventories 1,120 1,006 1,062 1,162
Trade and other receivables 1,787 1,317 619 895
Cash and cash equivalents 81 770 745 1,925
------------------------------------- ----------- ---------- ----------- ----------
2,988 3,093 2,426 3,982
------------------------------------- ----------- ---------- ----------- ----------
Total assets 8,707 8,787 8,003 9,344
Current liabilities
Other interest bearing loans and
borrowings (68) (118) (65) (88)
Loans associated with right of
use assets (138) (138) (137) (137)
Trade and other payables (934) (1,028) (478) (584)
------------------------------------- ----------- ---------- ----------- ----------
(1,140) (1,284) (680) (809)
Non-current liabilities
Government Grants (200) (200) (200) (200)
Liabilities associated with right
of use assets (1,218) (1,207) (1,274) (1,244)
Other interest bearing loans and
borrowings (531) (476) (357) (270)
------------------------------------- ----------- ---------- ----------- ----------
Total liabilities (1,949) (1,883) (1,831) (1,714)
------------------------------------- ----------- ---------- ----------- ----------
Net assets 5,618 5,618 5,493 6,822
------------------------------------- ----------- ---------- ----------- ----------
Equity
Share capital 1,361 1,361 1,230 1,360
Share premium 20,712 20,712 18,972 20,704
Capital reserve 464 464 464 464
Retained loss (16,918) (16,917) (15,175) (15,706)
------------------------------------- ----------
Total equity attributable to equity
shareholders of the company 5,618 5,620 5,490 6,822
------------------------------------- ----------- ---------- ----------- ----------
Statement of Cash Flow
RESTATED RESTATED
Seven
Six Months Months Six Months Year
Ended Ended Ended Ended
30-Nov-19 31-Dec-19 30-Nov-18 31-May-19
GBP'000 GBP'000 GBP'000 GBP'000
Unaudited Unaudited Unaudited Unaudited
---------------------------------------- ----------- ---------- ----------- ----------
Cash flow from operating activities
Loss after tax for the year (1,302) (1,317) (1,509) (2,109)
Adjusted for:
Profit on disposal of property
plant and equipment 0 0 0 0
Depreciation and amortisation charge 239 290 209 442
Equity settled share-based payment
expenses 91 106 80 146
Financial expense 49 63 44 96
Financial income (1) (1) (1) (2)
Taxation 0 (443) 0 (921)
---------------------------------------- ----------- ---------- ----------- ----------
(924) (1,302) (1,178) (2,348)
Changes in working capital
Decrease/(increase) in inventories 42 157 (206) (307)
Decrease/(increase) in trade and
other receivables (892) (422) 157 281
Increase/(decrease) in trade and
other payables 350 444 (252) (206)
---------------------------------------- ----------- ---------- ----------- ----------
(1,424) (1,123) (1,479) (2,580)
Taxation received 0 443 0 521
---------------------------------------- ----------- ---------- ----------- ----------
Net cash used in operating activities (1,424) (681) (1,479) (2,059)
---------------------------------------- ----------- ---------- ----------- ----------
Cash flows from investing activities
Acquisition of tangible and intangible
assets (597) (622) (156) (175)
Proceeds from disposal of property,
plant and equipment 0 0 0 0
Net cash used in investing activities (597) (622) (156) (175)
---------------------------------------- ----------- ---------- ----------- ----------
Cash flows from financing activities
Proceeds from issue of share capital,
net of expenses 9 9 1,466 3,328
Payment of finance lease liabilities (63) (53) (33) 3
Proceeds from long term loans 279 253 66 0
Interest received 1 1 2 2
Interest paid (49) (63) (44) (96)
---------------------------------------- ----------- ---------- ----------- ----------
Net cash generated from financing
activities 177 147 1,457 3,236
---------------------------------------- ----------- ---------- ----------- ----------
Net (decrease)/increase in cash
and cash equivalents (1,844) (1,155) (178) 1,002
Cash and cash equivalents at the
beginning of the period 1,925 1,925 923 923
---------------------------------------- ----------- ---------- ----------- ----------
Cash and cash equivalents at the
end of the period 81 770 745 1,925
---------------------------------------- ----------- ---------- ----------- ----------
Statement of Changes in Equity
Share
Share premium Capital Retained
capital account reserve loss Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- --------------------- --------------------- --------------------- --------- --------
Balance as at 31 May 2019 1,360 20,704 464 (15,707) 6,821
Comprehensive income for
the year
Loss for the year (1,302) (1,302)
---------------------------- --------------------- --------------------- --------------------- ---------
Total comprehensive income
for the year - - - (1,302) (1,302)
---------------------------- --------------------- --------------------- --------------------- --------- --------
Transactions with owners,
recorded directly to equity
Shares issued in the year 1 8 9
Equity settled share based
payment transactions 91 91
---------------------------- --------------------- --------------------- --------------------- ---------
Total contributions by and
distributions to the
owners 1 8 - 91 100
---------------------------- --------------------- --------------------- --------------------- ---------
Balance at 30 November 2019 1,361 20,712 464 (16,918) 5,618
---------------------------- --------------------- --------------------- --------------------- --------- --------
Restated
Share Retained Retained
Share premium Capital loss IFRS16 loss
capital account reserve (Unaudited) Impact (Unaudited) Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- --------------------- --------------------- --------------------- ------------ --------------------- ------------ --------
Balance as at
31 May
2018 1,140 17,596 464 (13,652) (91) (13,743) 5,457
Comprehensive
income
for the year
Loss for the
year (1,482) (27) (1,509) (1,509)
--------------- --------------------- --------------------- --------------------- ------------ ------------ --------
Total
comprehensive
income for
the year - - - (1,482) (27) (1,509) (1,509)
--------------- --------------------- --------------------- --------------------- ------------ --------------------- ------------ --------
Transactions
with owners,
recorded
directly to
equity
Shares issued
in the
year 90 1,445 1,535
Cost of issue
off to
share premium (69) (69)
Equity settled
share
based payment
transactions 76 76 76
--------------- --------------------- --------------------- --------------------- ------------ --------------------- ------------ --------
Total
contributions
by and
distributions
to the owners 90 1,376 - 76 - 76 1,542
--------------- --------------------- --------------------- --------------------- ------------ --------------------- ------------ --------
Balance as at
30 November
2018 1,230 18,972 464 (15,058) (118) (15,176) 5,490
--------------- --------------------- --------------------- --------------------- ------------ --------------------- ------------ --------
Restated
Share Retained Retained
Share premium Capital loss IFRS16 loss
capital account reserve (Audited) Impact (Unaudited) Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- --------------------- --------------------- --------------------- ---------- --------------------- ------------ --------
Balance as at
31 May
2018 1,140 17,596 464 (13,652) (91) (13,743) 5,457
Comprehensive
income
for the year
Loss for the
year (2,059) (50) (2,109) (2,109)
--------------- --------------------- --------------------- --------------------- ---------- --------------------- ------------ --------
Total
comprehensive
income for
the year - - - (2,059) (50) (2,109) (2,109)
--------------- --------------------- --------------------- --------------------- ---------- --------------------- ------------ --------
Transactions
with owners,
recorded
directly to
equity
Shares issued
in the
year 213 3,228 3,441
Share options
exercised 7 63 70
Cost of issue
off to
share premium (183) (183)
Equity settled
share
based payment
transactions 145 145 145
--------------- --------------------- --------------------- --------------------- ---------- --------------------- ------------ --------
Total
contributions
by and
distributions
to the owners 220 3,108 - 145 - 145 3,473
--------------- --------------------- --------------------- --------------------- ---------- --------------------- ------------ --------
Balance as at
31 May
2019 1,360 20,704 464 (15,566) (141) (15,707) 6,821
--------------- --------------------- --------------------- --------------------- ---------- --------------------- ------------ --------
SURFACE TRANSFORMS PLC
NOTES
1. Accounting policies
The interim financial statements are the responsibility of the
Directors and were authorised and approved by the Board of
Directors for issuance on 28 February 2020.
Basis of preparation
The Company is a public limited liability Group incorporated and
domiciled in England & Wales. The financial information is
presented in Pounds Sterling (GBP) which is also the functional
currency. The Company's accounting reference date is 31
December.
These interim condensed financial statements are for the six
months to 30 November 2019. They have not been prepared in
accordance with IAS 34, Interim Financial Reporting that is not
mandatory for UK AIM listed companies, in the preparation of this
half-yearly financial report. While the financial information
included has been prepared in accordance with the recognition and
measurement criteria of International Financial Reporting Standards
(IFRS), as adopted by the European Union (EU), these interim
results do not contain sufficient information to comply with
IFRS.
These interim results for the period ended 30 November 2019,
which are not audited; do not comprise statutory accounts within
the meaning of section 435 of the Companies Act 2006.
Full audited accounts of the Company in respect of the year
ended 31 May 2019, which received an unqualified audit opinion and
did not contain a statement under section 498(2) or (3) (accounting
record or returns inadequate, accounts not agreeing with records
and returns or failure to obtain necessary information and
explanations) of the Companies Act 2006 and have been delivered to
the Registrar of Companies.
The accounting policies used in the preparation of the financial
information for the six months ended 30 November 2019 are in
accordance with the recognition and measurement criteria of IFRS as
adopted by the EU and are consistent with those which will be
adopted in the annual statutory financial statements for the year
ending 31 December 2019.
Accounting for Right of Use Assets
IFRS 16 requires the company to capitalise assets to which it
has the right of use. Assets are then depreciated and implicit
interest charged to the P&L. The company has followed accepted
guidance in the preparation of these charges. The impact of the
standard is to accelerate the charge to the P&L of the lease
liability and to reduce expenses and increase interest and
depreciation charges. The only significant right of use asset
applicable to the company is the rent payable on the Knowsley
facility. The actual rent payable remains as previously
expected.
Segmental reporting
IFRS 8 "Operating Segments" requires that the segments should be
reported on the same basis as the internal reporting information
that is provided to, and regularly reviewed by, the chief operating
decision-maker, whom the Group has identified as the CEO.
The Board has reviewed the requirements of IFRS 8, including
consideration of what results and information the CEO reviews
regularly to assess performance and allocate resources, and
concluded that all revenue falls under a single business
segment.
The Directors consider that the Group does not have separate
divisional segments as defined under IFRS 8. The CEO assesses the
commercial performance of the business based upon consolidated
revenues; margins and operating costs and assets are reviewed at a
consolidated level.
Estimates
The preparation of half-yearly financial statements requires
management to make judgments, estimates and assumptions that affect
the application of accounting policies and the reported amounts of
assets and liabilities, income and expense. Actual results may
differ from these estimates. In preparing these condensed
consolidated half-yearly financial statements, the significant
judgments made by management in applying the Group's accounting
policies and the key sources of estimation uncertainty which will
be adopted in the annual statutory financial statements for the
year ending 31 December 2019
Going concern
The financial statements have been prepared on a going concern
basis that the Directors believe to be appropriate. Whilst the
Group incurred a net loss of GBP1,298k during the period, the
Directors are satisfied that sufficient cash is available to meet
the Company's liabilities as and when they fall due for at least 12
months from the date of signing the half yearly report.
2. Taxation
Analysis of credit in the period
Six months Seven months Six months Year ended
ended ended ended
ended
30-Nov 31-Dec 30-Nov 31-May
2019 2019 2018 2019
GBP'000 GBP'000 GBP'000 GBP'000
(unaudited) (unaudited) (unaudited) (audited)
UK Corporation tax
Current tax on income - - - -
for the period
Research and development
tax in respect of prior
years - 123 - 521
Research and development
tax allowances for current
year 274 320 - 400
274 443 - 921
------------ ------------- ------------ -----------
The effective rate of tax for the period/year is lower than the
standard rate of corporation tax in the UK of 20 per cent,
principally due to losses incurred by the Company.
The potential deferred tax asset relating to losses has not been
recognised in the financial statements because it is not possible
to assess whether there will be suitable taxable profits from which
the future reversal of the underlying timing differences can be
deducted.
3. Loss per share
Six months Seven months Restated Six Restated Year
ended ended months ended
ended
30-Nov 31-Dec 30-Nov 31-May
2019 2019 2018 2019
(unaudited) (unaudited) (unaudited) (unaudited)
Pence Pence Pence Pence
Loss per
share:
Basic
and diluted (0.96) (0.96) (1.24) (1.68)
------------ ------------- -------------- --------------
Loss per ordinary share is based on the Company's loss for the
financial period of GBP1,302k (30 November 2018: GBP1,505k loss; 31
May 2019: GBP2,100 loss). The weighted average number of shares
used in the basic calculation is 136,025,765 (31 May 2019:
125,184,218; 30 November 2018: 121,756,727).
The calculation of diluted loss per ordinary share is identical
to that used for the basic loss per ordinary share. This is because
the exercise of share options would have the effect of reducing the
loss per ordinary share and is therefore not dilutive under the
terms of International Accounting Standard 33 "Earnings per
share".
4. Segment reporting
Due to the startup nature of the business the Company is
currently focused on building revenue streams from a variety of
different markets. As there is only one manufacturing facility, and
as this has capacity above and beyond the current levels of trade,
there is no requirement to allocate resources to or discriminate
between specific markets or products. As a result, the Company's
chief operating decision maker, the Chief Executive, reviews
performance information for the Company as a whole and does not
allocate resources based on products or markets. In addition, all
products manufactured by the Company are produced using similar
processes. Having considered this information in conjunction with
the requirements of IFRS 8, as at the reporting date the Board of
Directors has concluded that the Company has only one reportable
segment that being the manufacture and sale of carbon fibre
materials and the development of technologies associated with
this.
The Company considers it offers product technology namely carbon
fibre re-enforced ceramic material which is machined into different
shapes depending on the intended purpose of the end user.
Revenue by geographical destination is analysed as follows:
Six Months Seven Months Restated Restated
Ended Ended Six Months Year Ended
Ended
30-Nov-19 31-Dec-19 30-Nov-18 31-May-19
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
GBP'000 GBP'000 GBP'000 GBP'000
United Kingdom 745 963 112 220
Rest of Europe 90 165 168 492
United States
of America 163 251 216 269
Rest of World 30 72 12 21
----------------
1,029 1,451 509 1,002
---------------- ------------- ------------- ------------- ------------
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR DZGZZMNVGGZZ
(END) Dow Jones Newswires
February 28, 2020 02:00 ET (07:00 GMT)
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