REG - Concurrent Tech. - Final Results for the year ended 31 December 2024
14/04/2025 07:00
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RNS Number : 8611E Concurrent Technologies PLC 14 April 2025
14 April 2025
Concurrent Technologies Plc
(the "Company" or the "Group")
Final results for the year ended 31 December 2024
Record financial performance, underpinning confidence in long-term growth
Concurrent Technologies Plc (AIM: CNC), a designer and manufacturer of
leading-edge computer products, systems, and mission-critical solutions used
in high-performance markets by some of the world's major OEMs, announces its
audited final results for the year ended 31 December 2024.
Financial Highlights
2024 2023 Restated % change
Revenue £40.3m £31.7m 27%
Gross Profit £20m £15.6m 28%
Profit before tax & exceptionals £5.2m £3.7m 40%
Earnings per share 5.49p 4.06p 26%
Dividend per share 1.1p 1.0p 10%
EBITDA £7.8m £6.0m 30%
Order intake £41m £28.2m 45%
Closing cash £13.7m £11.1m 23%
· Record financial performance in FY24, delivering revenue of £40.3m, up 27% on
the prior year.
· Profit before tax increased by c.40% to £5.2m, including a significant
investment of £1.1m in the Systems business, as planned.
· Gross profit increased by 28% to £20m (FY23 £15.6m) reflecting the
significant increase in revenue with the gross profit margin remaining strong
at 49.5% (FY23 48.4%)
· EBITDA increased by 30% to £7.8m (FY23 £6.0m).
· Cash generative with closing net cash balance of £13.7m (FY23 £11.1m),
despite a one-off exceptional last-time investment in inventory in H1 of $4.6m
/ £3.5m.
· The Board will propose, at the Company's Annual General Meeting to be held on
12 June 2025, a final dividend of 1.1 pence per Ordinary Share in the Company
(FY23 1.0p). Subject to the approval of shareholders, the final dividend will
be paid on 4 July 2025 to shareholders on the register on 20 June 2025.
Operational Highlights
· Continued investment in R&D to improve the cadence and time to market of
the Group's products as demonstrated by several new product launches including
Rhea, to support existing and new VME customers and Hermod II, highlighting
the Group's ambitious product roadmap within the Systems business.
· New partnerships secured, including with Parry Labs, Eizo Rugged and a
fast-growing defence prime contractor in the US, which are critical for the
Group to strengthen its position in the defence sector.
· Launch of new website and update to branding to better reflect the Company's
vision and ambitions.
· The Group now structured and operating across two business units - Products
and Systems - to align with growth strategy.
Products business unit
· Secured 22 design wins across key geographies, including 10 'major wins'
underpinning the Group's long-term growth trajectory.
· The design wins include the largest-ever contract to date, with a major US
Defence & Aerospace contractor, valued at $6 million, set to contribute
materially from 2027.
· Invested in machinery, test equipment and power infrastructure to enhance
manufacturing efficiency.
Systems business unit
· Significant investment in FY24 with performance in line with the Board's
expectations and Phillips Aerospace now fully integrated into the non-US
Systems business.
· Early signs of success, driven by a significant $3.7m design win contract with
a leading defence platform provider in Asia, a new market for the Systems
business unit.
· Strategic investments in key hires to accelerate growth, including a new Vice
President of Systems in LA, and doubling the size of the team in the region.
Post-Period End
· Received a significant £3.4m order for the Company's VME-based 6U computer
boards from a long-standing European customer, underscoring the Group's
support for the VME standard.
· Launched Kratos, one of the first and most powerful rugged plug-in card's
available today, built on Intel's latest 6516P-B processor which the Company
had access to six months early.
· Commenced trading on the OTCQX® Best Market in the US, in addition to AIM, to
better engage with US investors, data distributors and media partners.
· 20-year lease for a new property for Concurrent's Colchester based
headquarters and manufacturing capability agree, with planned capacity
expansion in US in FY25 to meet the growing demand for the Group's products.
Outlook
· There is growing momentum across the Products and Systems business units, and
the Company expects this trend to continue in the coming years.
· The Group aims to navigate the rapidly evolving tariff arrangements being
implemented by the US administration with efficiency and pricing measures, as
well as monitoring any impact of longer-term tariffs on the Company's
programmes and markets.
· Board expects trading for the full year to be in line with market
expectations.
Miles Adcock, CEO of Concurrent Technologies, commented: "FY24 has been
another transformative year for Concurrent in which we delivered a robust
financial performance, demonstrating the success of our refreshed strategy.
Our focus on delivering industry-leading solutions at pace and investing in
both our Products and Systems business units, position us well for long-term
growth.
"2025 has started strongly in terms of both output and winning.
Notwithstanding the significant uncertainty created by new tariffs, we
currently expect to deliver results for FY25 in line with market
expectations."
Enquiries:
Concurrent Technologies Plc
Miles Adcock - CEO
+44 (0)1206 752626
Kim Garrod - CFO
Alma Strategic Communications +44 (0)20 3405 0205
Hannah Campbell
Josh Royston
Will Merison
Cavendish Capital Markets Limited (NOMAD) +44 (0)131 220 9771
Neil McDonald
+44 (0)131 220 9772
Peter Lynch
About Concurrent Technologies Plc
Concurrent Technologies Plc develops and manufactures high-end embedded
plug-in cards and systems for use in a wide range of high-performance,
long-life cycle applications within the telecommunications, defence, security,
telemetry, scientific and aerospace markets, including applications within
extremely harsh environments. The processor products feature
Intel® processors, including the latest generation embedded Intel® Core™
processors, Intel® Xeon® and Intel Atom™ processors. The products are
designed to be compliant with industry specifications and support many of
today's leading embedded operating systems. The products are sold world-wide.
Chair statement
FY24 marked another record year for Concurrent, with exceptional revenue and
profit performance, and a strong order book and cash position. This success is
driven by our refreshed strategy which focuses on accelerating the time to
market of our products. Significant efforts have been made across the Group,
including investments in R&D, strengthening Company culture, and
optimising the team structures to support our strategy and to position the
Company to capitalise on the exciting prospects in FY25 and beyond.
The year in review
The Group reported record revenue and profitability for the year of £40.3m
and £5.2m respectively, evidencing the transformation of the business and
successful growth strategy implementation. The increase in profit reflects the
initial delivery of operational gearing as the business scales. This
performance is achieved despite considerable investment in the Systems
business in LA which was acquired in FY23 and was loss making in FY24, in line
with expectations.
The Group secured 10 major design wins in FY24, including our largest contract
to date. Alongside this, Concurrent launched several new products
demonstrating the increasing appetite for our solutions against the larger
players in the industry. We also secured our first major Systems design win in
the year, highlighting that the investment being made into the Systems
business - including the integration of Phillips Aerospace - is proving
successful.
This progress, alongside the strength of our statement of financial position,
puts us in an opportune position for continued growth.
Execution against strategy
We are committed to providing cutting-edge, reliable technology to our
customers at an unparalleled pace and, through our Systems and Products units,
we have continued to deliver in FY24.
The 10 major design wins secured through the Products unit will ramp up in the
coming years in line with our customers' programmes, but they provide
long-term, multi-year revenue visibility, which supports the investment plans
in our R&D roadmap.
The Systems unit, which is still in its early stages, is making solid progress
and we are confident this unit will grow going forward. With the integration
of Phillips Aerospace, we secured several key contracts and are seeing
positive momentum in both the US and international markets.
While organic growth remains a priority, as we look to significantly expand
Concurrent's UK product manufacturing capacity with a new facility to
accommodate growth opportunities, we also see opportunities for bolt-on
acquisitions to enhance our Systems capability, as demonstrated so far by the
successful acquisition of Phillips Aerospace.
Board and people
We were delighted to welcome Issy Urquhart to the Board as an Independent
Non-Executive Director in February 2024. Issy brings over 30 years' experience
working with global technology and financial services businesses, where she's
been responsible for implementing successful people programmes. She is already
proving to be an invaluable guide to Concurrent as we deliver on our growth
strategy and create the right environment for our people to succeed.
In FY24, our CEO, Miles Adcock, played a pivotal role in defining and
embedding a new target culture across the organisation, centred on four key
pillars: get things done, no spectators, ambition, and buzzing.
This culture emphasises a proactive and results-oriented approach, encouraging
all employees to actively contribute to the Company's success by sharing
ideas, adding value, and embracing ambition. It underscores a commitment to
achieving excellence while fostering a positive, inclusive, and dynamic
workplace environment. As the organisation continues to expand, this cultural
transformation will ensure alignment and cohesion among both new hires and
long-standing team members.
I would also like to take this opportunity to thank the whole team for their
hard work and commitment in what has been another notable year for the
Company.
Dividend
A 1.1p dividend has been proposed for shareholder approval at the annual
general meeting (AGM) which, if passed, will amount to c. £942,000 paid in
early July 2025. This reflects a 10% increase on last year and recognises the
improved performance, whilst retaining funds for future growth. The Board
anticipates this balance will continue, with an appropriate level of cover
maintained to enable investment for future growth.
Outlook
We remain focused on launching leading-edge products and accelerating the
ramping up of design wins across both the Boards and Systems units for new and
existing customers, converting into significant long-term revenue streams for
Concurrent. The performance in FY24 supports this strategy and we are already
seeing positive momentum in the new financial year, providing confidence in
the positive performance in FY25 and beyond.
Mark Cubitt
Chairman
CEO statement
Overview
I am very pleased to be reporting on another year of strong growth for
Concurrent, in which we delivered on our commitments - executed as planned -
and we continue to position the Group to become a much larger business over
time.
Financial performance
We delivered a record financial performance across all key metrics in FY24,
with revenue of £40.3m, up 27% (FY23: £31.7m), largely driven by our renewed
focus on developing sector-leading products, combined with an energised sales
team across our home markets that have been instrumental in driving new
customers as well as winning new programmes with existing customers. I'm proud
that we have delivered record results across the board whilst maintaining
strong investments in the areas that we have declared will drive ongoing
growth.
Strategy
The Group now operates across two units - Products and Systems - to align with
our growth strategy and ambition of being the first to market with the latest
technology. We have made good progress throughout the year in ensuring these
divisions are set up for growth, incorporating the acquired Phillips Aerospace
into Systems and adjusting our leadership teams to reflect this progress and
focus. Whilst we are excited by the opportunity to significantly scale
Concurrent organically over the next few years, we believe there is also a
range of opportunities to expand our capability, customer list and market
penetration through acquisition. The acquisition of Phillips Aerospace has
been successful and is a good example of how we have delivered on our
acquisition strategy to expand the Systems division. Alongside this, the
company is now also exploring adjacent and complementary businesses that have
the potential to open new opportunities in new markets.
Products
Our long-standing Products business designs and manufactures computer boards,
and this is where we have substantial expertise and a reputation for quality
and collaboration. Much of our business in boards is secured via 'design wins'
where customers integrate our products into their programmes, leading to
purchase orders in future years as production volumes ramp up, usually two to
three years later. This is the most important leading indicator of future
growth as a 'major design win' and is one with the potential to achieve peak
volumes of >£1m per annum for several consecutive years. Out of 22 design
wins, we secured 10 major design wins in FY24, representing a lifetime value
to the business of at least £100m. Notably, we secured our largest-ever
contract of $6m with a major US defence and aerospace prime contractor,
highlighting the potential for future upscaling. This contract was for an
initial $4.46m in H1 FY24, with an additional uplift of $1.52m in August,
reflecting the customer's trust in the reliability of our products and the
strength of the relationship.
Doubling the capacity of our facility in Colchester in FY24 has been crucial
to supporting the increasing number of design wins and post year end, we
signed a 20-year lease for a new property for our Colchester headquarters and
manufacturing capability. This new facility will further the Company's ability
to service the ongoing growth of the business. We have also invested in our
machinery, test equipment and power infrastructure which will further enhance
our manufacturing efficiency.
Systems
Our Systems business unit, which is still in its early stages of development,
performed as we expected, in line with our strategic plan, and we remain
confident that this unit will grow in 2025. Phillips Aerospace is now
successfully integrated with our non-US Systems business and we are already
seeing excellent progress, driven by a significant $3.7 million order win for
Systems in Asia and three new contracts in the US. The successful expansion
into this new market is a clear indicator of the growing momentum in our
Systems business unit, and we expect this trend to continue in the coming
years.
The Systems business is strategically benefitting from careful investment in
key hires. We welcomed Michael Harden to the Group, who joined our Executive
Committee in FY24 as Vice President of the Systems business in LA, and we have
now doubled the number of colleagues operating from LA.
With an FY24 closing backlog of c. $5m, the Systems business is well
positioned for growth in FY25, and we are mobilising a strong team
accordingly, with a pending move into a new state-of-the-art facility.
Markets
The defence sector remains a key driver of our overall growth, now accounting
for 87% of our board revenue. As global military services work to improve
their operational capabilities, the increased focus on defence electronics to
upgrade existing platforms is fuelling demand for our products. As mentioned,
we are also seeing growth in international geographies, particularly in the
USA, where our systems solutions are gaining traction. The Sensor Open
Standards Architecture (SOSA) initiative in the US is creating new
opportunities for suppliers like us to displace established competitors and we
are capitalising on this shift with our innovative products and services.
Rising defence budgets worldwide are further driving growth, all of which will
translate into longer-term in-field deployments, resulting in step-changes in
revenue for Concurrent. Industrial and scientific (7%) and communications and
other (6%) are our additional important domains.
R&D
Progressive R&D for new product development remains the priority for
organic growth. With continued focus on innovation with launches including
Rhea, Magni, TR MDx/6sd-RCR, and Hermod II in FY25, we are developing real
momentum with customers - a trend set to continue during 2025.
Rhea, part of our expanded VME range, taps into an estimated $300m market. A
£3.4m order from a long-standing European customer reinforces our commitment
to the VME standard and supporting customers with reliable,
backward-compatible solutions. We also launched Magni, a high-performance
SOSA-aligned PIC, and TR MDx/6sd-RCR to meet growing demand for
compute-intensive solutions.
Hermod II, a rugged 10 Gigabit Ethernet switch designed for harsh environments
in defence and heavy industrial sectors, adds to our product offerings at the
board level, enabling Concurrent to occupy more of a system with our own
technology. It highlights the ambitious product roadmap within the Systems
business, aiming to both upgrade existing systems and create solutions for
next-generation deployments.
Partnerships
As part of our strategy to develop a broader range of products and services,
securing and maintaining partnerships is critical for expanding the size and
markets available to us.
In FY24, we established several strategic partnerships to strengthen our
position in the defence sector. A key collaboration with Parry Labs - a
rapidly growing US defence contractor - enabled us to provide SOSA-aligned
hardware, allowing Parry Labs to deliver integrated hardware and software
solutions. Another partnership with a fast-growing US defence prime contractor
secured them as a key customer for our boards and systems while also supplying
a critical switch for our systems. Additionally, our partnership with Eizo
Rugged incorporated their graphics card products into our comprehensive
systems solutions for customers.
People and ESG
The progress we are making at Concurrent is only possible with a relentless
focus on talent and culture. In recent years, we have assembled a Board and
Executive Committee with experience in transforming businesses and growing
sales globally, and our success in FY24 is due to the efforts of this team.
This hard work led to the creation of a new brand launched in the year to
better reflect the Group's vision and future ambitions.
To continue with our significant transformation to deliver more products
faster to market, we are focused on operational excellence and refined
governance. With our people at the centre, we have invested our time and
energy in making sure that we maintain an inclusive and engaged workforce
providing an attractive reward and benefits offering and a developmental place
to work. A continuing key focus area for the Group is delivering quality and
safe products to our customers and ensuring this quality through the
management of our supply chain. It is also critical that we maintain robust
governance across the organisation, building resilience through our extensive
control frameworks. As detailed in the ESG Report in our Annual Report, during
FY24 we have continued to invest in all these priority areas, as well as
continuing to take steps to minimise our operational impact on the environment
and building stronger community ties through several charitable efforts across
the business. We have also reported our UK operational carbon footprint for
the first time this year, in line with the Streamlined Energy and Carbon
Reporting regulations.
Summary and outlook
Concurrent is evolving in a way that builds a foundation for long-term growth
and expanded market reach. We have delivered both financially and
operationally in FY25 as we continue to bring products to market faster for
our customers.
I consider that £100m per annum revenue is a meaningful future milestone for
this business and given the progress we continue to make, the Board is fully
confident in our ability to achieve this. Trading in FY25 has started well,
with a focus on continuing to deliver as planned. Looking further ahead, we
anticipate continued growth in revenues and profit from 2026, driven by the
full impact of our major design wins and increased capacity across our
operations.
Miles Adcock
Chief Executive Officer
CFO statement
Financial KPIs
2023 (restated) 2024
Revenue £31.7m £40.3m
% change vs previous year 73% 27%
Gross profit £15.6m £20m
% Gross margin 49.4% 49.5%
Profit before tax £3.7m £5.2m
% change vs previous year 658% 40%
Earnings per share 4.06p 5.49p
Dividend per share 1p 1.1p
EBITDA £6.0m £7.8m
% change 185% 30%
Closing cash £11.1m £13.7m
% change vs previous year 146% 23%
Investment in R&D £3.8m £3.0m
Total assets £46.7m £50.8m
Shareholders' funds £34.3m £38.9m
Revenue
An excellent year with revenues growing by 27% to £40.3m (FY23: £31.7m). The
Company generates sales through products and associated services,
customer-funded projects (mainly modification programmes), and the sales of
Systems and their development. Products sales remain the major revenue
contributor at £37m, plus Systems revenue of £2.1m and project revenue of
£1.2m.
Geographical split of revenue
Revenue Year to Year to
31 December 31 December
2024 2023
£ £
United States 18,333,933 13,060,691
Malaysia 1,782,697 392,850
Germany 3,614,506 6,450,372
United Kingdom 2,929,047 2,148,568
Other Europe 8,146,423 4,178,401
Rest of the World 5,517,477 5,425,434
40,324,083 31,656,316
The geographical split remains worldwide and is driven by customer
requirements (not always the same every year due to the nature of our
products). The US remains dominant for revenue growing from 41% to 45% of
revenue in FY24 (FY23: £13.1m; FY24 to £18.3m). Europe has increased by c.
10%/£1m, with continued growth in Asia c. 80%/£3m, with a small decrease in
ROW.
The largest customer in FY24 was in the US at £6m, followed by Italy and
India. With the direction of working with major primes and increasing our
customer base, our top 10 customers equate to c. 54% of our revenue (FY23:
52%)
% revenue by top customers
Customer % of total revenue
1 15%
2 9%
3 5%
4 5%
5 4%
6 4%
7 3%
8 3%
9 3%
10 3%
Revenue by market
Defence £35,016,539 87%
Industrial and scientific £3,033,160 7%
Medical, communications and other £2,274,384 6%
£40,324,083
Gross profit
Gross profit grew by c. 28% to £20m (FY23: £15.6m), with gross profit margin
remaining strong at 49.5% (FY23: 49.4%) The gross margin on products increased
marginally in the year. This improvement was largely offset, as expected, by a
lower margin mix in our systems and projects businesses which included
customer programmes, varying third party content and increased direct manpower
costs.
Profit
Profit before tax increased by c. 40% to £5.2m (FY23: £3.7m), after a
significant investment in the Systems business of £1.1m, as planned. Product
profit margins remain strong at c. 50%, reflecting strong efficiency and
effectiveness as a result of investment in people, tools and processes over
the last few years. Record revenue for a second year and corresponding
increased gross profit have resulted in increased profitability. EBITDA
(measured as operating profit adjusted for depreciation and amortisation)
increased by 30% to £7.8m (FY23: £6m). Amortisation of our product
development was up by 28% to £1.9m, reflecting the new product portfolio
continuing to be released into the costs of the business, across the year.
Capitalisation of product development is lower in FY24 at £3m (FY23: £3.8m)
due to increased customer-funded design and engineering, and the level of
internal development.
Earnings per share (EPS) was 5.12p (FY23: 4.06p). This reflects the increased
number of shares, in full, following the equity raise in August FY23.
Cost base
The Group continues to balance an efficient and effective cost base, with a
strong growth strategy. FY24 represented a first full year of the full
investment costs (predominantly people) in the Products business and functions
supporting it. In the year, the Group also significantly invested in the
Systems business, mainly with additional people to support growth to be ready
to efficiently deliver new business as won.
The Group continues to pursue the strategy, investing in R&D, developing
new products and securing talented people to deliver and drive the business.
Operating expenses
FY24 FY23 Variance
£m £m
14.8 12.2 2.6
Total operating expenses
Salaries, NI & pension 11.0 9.0 2.0
Bonus & commissions 1.8 1.9 -0.1
Total salary related costs 12.8 10.9 1.9
Other costs 3.4 3.4 0
Capitalisation +3.0 +3.8 -0.8
Amortisation 1.9 1.4 -0.5
FX +0.3 0.3 +0.6
Total 14.8 12.2 2.6
Operating cost of Systems 1.3 0.3 1.0
As per the table above, a major part of the cost increase has been the
investment in people, with salaries increasing by £2m, with an additional
£1m accounted for in Systems (full year v partial year of c. 4 months).
Bonus and commissions were slightly down, with increased participants, offset
by a £300k one-off charge last year for the change in commission scheme.
Amortisation increased significantly due to our newer products being
completed. All other costs are relatively flat, with a favourable swing in
foreign exchange rates, important dominated by the USD.
Tax
The Group has undertaken a full tax review and computation, in accordance with
UK tax regulations. In FY24 we have a tax charge of £0.5m, due to reduced
R&D activity (some of this was diverted to customer-funded projects) and
increased profits. Tax planning is an part of our financial efficiency,
especially as we grow and the tax regime changes for R&D investment. We
will continue to review and maximise our position as we go forward.
Cash flow
The business has a healthy cash balance of £13.7m (FY23 £11.1m), with £7.9m
generated from normal operations (a strong increase from FY23 at £5.6m).
Revenue was strong in Q4, resulting in high trade receivables at the end of
FY24 of £6.2m. The business continued to be cash generative in FY24, despite
a significant investment in Systems and a one-off end-of-life purchase on
components which although delivered in FY23, was paid for in FY24.
Statement of financial position
Inventory at the close of FY24 was £11m (FY23: £12m). Following investment
in inventory during the component crisis of FY22 (and part way through FY23)
inventory levels began to normalise through FY24, reflecting increased
manufacturing levels and the acceleration of customer deliveries in the year.
Going forward we expect inventory levels to continue to normalise but against
a larger Group structure. The lead times and availability of components is now
back to pre-crisis levels, but we are seeing several examples of reductions in
component variations (SKUs), which is leading to some end-of-life products
being purchased. This is on a reasonable and manageable level and we will
continue to manage it tightly to ensure we maximise efficiency. The business
reviews inventory regularly and provides for obsolescence and slow-moving
inventory accordingly, which totalled £0.9m in FY24 (FY23 £1.26m).
Inventory continues to be a key factor in enabling the business to deliver
most efficiently and effectively, with careful management contributing to the
reduction in lead times in getting products to customers.
Trade payables at £5.1m (FY23: £5.7m) are at a slightly lower level to FY23.
However, FY24 closing does not now include a large one-off payment for an
end-of-life component purchase, which was cleared in April FY24, value c.
£3.5m. The lower payables reflect a more effective supply chain and better
delivery availability (more efficient in ordering in a timely manner).
Kim Garrod
Chief Financial Officer
Consolidated statement of comprehensive income
Note
Year to Year to
31 December 31 December
2024 2023 (as restated)
CONTINUING OPERATIONS £ £
Revenue 3 40,324,083 31,656,316
Cost of sales (20,348,752) (16,018,368)
Gross profit 19,975,331 15,637,948
Administrative expenses (14,782,064) (11,951,314)
Group operating profit 4 5,193,267 3,686,634
Finance costs (93,284) (86,010)
Finance income 5 79,294 68,145
Exceptional items 28 - (195,881)
Profit before tax 5,179,277 3,472,888
Tax (charge)/credit 6 (476,839) (312,752)
Profit for the year 4,702,438 3,160,136
Other comprehensive income
Exchange gains/(losses) on translating foreign operations (53,556) (101,340)
Other comprehensive income for the year, net of tax (53,556) (101,340)
Total comprehensive income for the year 4,648,882 3,058,796
Profit for the period attributable to:
Equity holders of the parent 4,702,438 3,160,136
Total comprehensive income attributable to:
Equity holders of the parent 4,648,882 3,058,796
Earnings per share
Basic earnings per share 8 5.49p 4.06p
Diluted earnings per share 8 5.18p 3.95p
All operations were continuing within the year.
Consolidated statement of financial position
31 December 31 December
2024 2023 (as restated)
£ £
ASSETS
Non-current assets
Property, plant and equipment 11 2,686,772 2,465,883
Intangible assets 12 15,392,208 13,914,397
18,078,980 16,380,280
Current assets
Inventories 15 10,875,616 11,958,500
Trade and other receivables 16 8,104,112 6,442,827
Current tax assets 6 14,957 779,621
Cash and cash equivalents 13,706,703 11,118,728
32,701,389 30,299,676
Total assets 50,780,369 46,679,956
LIABILITIES
Non-current liabilities
Deferred tax liabilities 13 2,123,264 1,661,453
Trade and other payables 17 446,477 695,273
Long-term provisions 19 326,596 315,135
2,896,337 2,671,861
Current liabilities
Trade and other payables 17 8,940,768 9,666,412
Short-term provisions 19 18,256 18,256
8,959,024 9,684,668
Total liabilities 11,855,361 12,356,529
Net assets 38,925,008 34,323,428
EQUITY
Capital and reserves
Share capital 21 861,692 861,692
Share premium account 9,950,231 9,950,231
Merger reserve 1,283,457 1,283,457
256,976 256,976
Capital redemption reserve
Cumulative translation reserve (182,832) (129,276)
Profit and loss account 26,755,483 22,100,348
Equity attributable to equity holders of the parent 38,925,008 34,323,428
Total equity 38,925,008 34,323,428
Company statement of financial position
31 December 31 December
2024 2023 (as restated)
£ £
ASSETS
Non-current assets
Property, plant and equipment 11 2,468,789 2,374,209
Intangible assets 12 12,788,842 11,217,904
Investments 14 1,947,312 1,572,640
Trade and other receivables 16 3,301,753 -
20,506,697 15,164,753
Current assets
Inventories 15 10,094,952 11,754,564
Trade and other receivables 16 8,980,097 8,534,995
Current tax assets - 721,921
Cash and cash equivalents 10,692,223 9,111,243
29,767,272 30,122,723
Total assets 50,273,969 45,287,476
LIABILITIES
Non-current liabilities
Deferred tax liabilities 13 1,890,207 1,402,181
Trade and other payables 17 428,913 677,607
Long-term provisions 19 326,596 315,135
2,645,716 2,394,923
Current liabilities
Trade and other payables 17 7,011,848 8,890,046
Current tax liabilities 32,368 -
Short-term provisions 19 18,256 18,256
7,062,472 8,908,302
Total liabilities 9,708,188 11,303,225
Net assets 40,565,781 33,984,251
EQUITY
Capital and reserves
Share capital 21 861,692 861,692
Share premium account 9,950,231 9,950,231
Merger reserve 1,283,457 1,283,457
Capital redemption reserve 256,976 256,976
Profit and loss account 28,213,425 21,631,895
Equity attributable to equity holders of the parent 40,565,781 33,984,251
Total equity 40,565,781 33,984,251
Consolidated cash flow statement
Year to Year to
31 December 31 December
2024 2023 (as restated)
£ £
Cash flows from operating activities
Profit before tax for the period 5,179,277 3,472,888
Adjustments for:
Finance income (79,294) (68,145)
Finance costs 93,284 86,010
Depreciation 673,058 806,236
Amortisation 1,936,561 1,509,167
Impairment loss 4,088 31,557
Share-based payment 744,755 430,854
Exchange differences 25,547 (145,706)
Decrease/(increase) in inventories 1,082,884 (1,868,063)
(Increase)/decrease in trade and other receivables (1,661,285) (1,029,033)
(Decrease)/increase in trade and other payables (749,800) 2,853,322
Cash generated from operations 7,251,074 6,079,087
Tax received/(paid) 641,594 (444,210)
Net cash generated from operating activities 7,892,668 5,634,877
Cash flows from investing activities
Finance income 79,294 68,145
Purchases of property, plant and equipment (PPE) (877,072) (495,973)
Payment of acquisition of subsidiary net of cash acquired - (685,767)
Capitalisation of development costs and purchases of intangible assets (3,382,525) (3,977,839)
Net cash used in investing activities (4,180,302) (5,091,434)
Cash flows from financing activities
Equity dividends paid (856,377) -
Repayment of leasing liabilities (233,230) (215,209)
Interest paid (93,284) (86,010)
Issue of ordinary shares - 6,355,741
Sale/(purchase) of treasury shares 58,500 -
Net cash used in financing activities (1,124,391) 6,054,522
Effects of exchange rate changes on cash and cash equivalents - 8,043
Net increase/(decrease) in cash 2,587,975 6,606,008
Cash at beginning of period 11,118,728 4,512,720
Cash at the end of the period 13,706,703 11,118,728
Consolidated statement of changes in equity
Capital Cumulative Profit
Share Share redemption translation and loss Total
capital premium Merger reserve reserve reserve account equity
£ £ £ £ £ £ £
Balance at 1 January 2023 739,000 3,699,105 - 256,976 (27,936) 18,509,357 23,176,502
Profit for the period - - - - 3,160,136 3,160,136
Exchange differences on translating foreign operations - - - (101,340) - (101,340)
Total comprehensive income for the period (restated) - - - (101,340) 3,160,136 3,058,796
Share-based payment - - - - 430,854 430,854
Merger reserve 18,077 - 1,283,457 - - - 1,301,534
Issue of ordinary shares 104,615 6,251,126 - - - 6,355,741
-
Balance at 31 December 2023 (as restated) 861,692 9,950,231 1,283,457 256,976 (129,276) 22,100,347 34,323,427
Balance at 31 December 2023 (reported) 861,692 9,950,231 1,283,457 256,976 (129,276) 22,813,347 35,036,427
Prior year adjustment (note 2) (713,000) (713,000)
Balance at 31 December 2023 (as restated) 861,692 9,950,231 1,283,457 256,976 (129,276) 22,100,347 34,323,427
Profit for the period - - - - 4,702,438 4,702,438
Exchange differences on translating foreign operations - - - (53,556) - (53,556)
Total comprehensive income for the period (restated) - - - (53,556) 4,702,438 4,648,882
Share-based payment - - - - 744,755 744,755
Deferred tax on share-based payment - - - - 5,820 5,820
Dividends paid - (856,377) (856,377)
Sale/purchase of treasury shares - - - - 58,500 58,500
Balance at 31 December 2024 861,692 9,950,231 1,283,457 256,976 (182,832) 26,755,483 38,925,008
Company statement of changes in equity
Capital Profit
Share Share Merger reserve redemption and loss Total
capital premium reserve account Equity
£ £ £ £ £ £
Balance at 1 January 2023 739,000 3,699,105 - 256,976 18,022,596 22,717,677
Total profit and comprehensive income for the period - - - 2,919,774 2,919,774
Share-based payment - - - 430,854 430,854
Dividends received - - - 258,670 258,670
Merger reserve 18,077 - 1,283,457 - - 1,301,534
Issue of ordinary shares 104,615 6,251,126 - - 6,355,741
Balance at 31 December 2023 (as restated) 861,692 9,950,231 1,283,457 256,976 21,631,894 33,984,250
Balance at 31 December 2023 (reported) 861,692 9,950,231 1,283,457 256,976 22,344,894 34,697,250
Prior year adjustment (note 2) (713,000) (713,000)
Balance at 31 December 2023 (as restated) 861,692 9,950,231 1,283,457 256,976 21,631,894 33,984,250
Profit for the period 6,628,833
6,628,833
Share-based payment - - - 744,755 744,755
Deferred tax on share-based payment - - - 5,820 5,820
Dividends paid - - - (856,377)
(856,377)
Sale/purchase of treasury shares - 58,500 58,500
Balance at 31 December 2024 861,692 9,950,231 1,283,457 256,976 28,213,425 40,565,781
Notes to the financial statement for the year ended 31 December 2024
Note 1 GENERAL INFORMATION
The principal activity of Concurrent Technologies plc ('the Company') and its
subsidiaries (together 'the Group') is the design, development, manufacture
and marketing of single board computers for system integrators and original
equipment manufacturers.
Concurrent Technologies plc is the Group's ultimate Parent Company. It is
incorporated and domiciled in the United Kingdom. Concurrent Technologies
plc's shares are listed on the Alternative Investment Market of the London
Stock Exchange.
The Group's financial statements are presented in pounds sterling (£), which
is also the functional currency of the Parent Company. They have been approved
for issue by the Board of Directors on 11 April 2025.
Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation These financial statements are for the year ended 31 December 2024. They have
been prepared in accordance with UK-Adopted International Accounting Standards
and with the requirements of the Companies Act 2006. These financial
statements have been prepared under the historical cost convention.
New and amended IFRS Accounting Standards that are effective for the current
year
In the current year, the Group has applied a number of amendments to IFRS
Accounting Standards issued by the International Accounting Standards Board
(IASB) that are mandatorily effective for an accounting period that begins on
or after 1 January 2024. Their adoption has not had any material impact on the
disclosures or on the amounts reported in these financial statements.
· IAS 1: Further amendment to the Classification of Liabilities as Current or
Non-Current;
· IFRS 16: Lease Liability in a Sale and Leaseback;
· IAS 1: Non-current Liabilities with Covenants; and
· IAS 7 and IFRS 7: Supplier Finance Arrangements
New and revised IFRS accounting standards in issue but not yet effective
Certain standards, amendments to, and interpretations of, published standards
have been published that are mandatory for the Group's accounting years
beginning on or after 1 January 2025 or later years and which the Group has
decided not to adopt early:
· IAS 21: Lack of Exchangeability.
None of the above listed changes are anticipated to have a material impact on
the Group's financial statements.
Changes in significant accounting policies
There have been no changes in the year to significant accounting policies in
the period.
The policies set out below have been consistently applied to all the years
presented, except where stated.
Basis of presentation and disclosure exemptions The consolidated financial statements are presented in accordance with IAS 1
Presentation of Financial Statements. The Group has elected to present the
'Income Statement' and 'Statement of Other Comprehensive Income' in one
statement.
The company financial statements are separate financial statements prepared in
accordance with FRS 101. The company is a qualifying entity as defined in FRS
101 and has applied the disclosure exemptions available under FRS 101 in the
preparation of these financial statements.
As permitted by FRS 101, the company has taken advantage of the following
disclosure exemptions:
· A cash flow statement and related notes (IAS 7)
· Comparative information in respect of certain disclosures (IAS 1)
· Disclosure requirements of IFRS 7 (Financial Instruments: Disclosures)
· Disclosure requirements of IFRS 13 (Fair Value Measurement)
· Related party disclosures (IAS 24), where transactions are with wholly-owned
subsidiaries
New and revised IFRS accounting standards in issue but not yet effective
Certain standards, amendments to, and interpretations of, published standards
have been published that are mandatory for the Group's accounting years
beginning on or after 1 January 2025 or later years and which the Group has
decided not to adopt early:
· IAS 21: Lack of Exchangeability.
None of the above listed changes are anticipated to have a material impact on
the Group's financial statements.
Changes in significant accounting policies
There have been no changes in the year to significant accounting policies in
the period.
The policies set out below have been consistently applied to all the years
presented, except where stated.
Basis of presentation and disclosure exemptions
The consolidated financial statements are presented in accordance with IAS 1
Presentation of Financial Statements. The Group has elected to present the
'Income Statement' and 'Statement of Other Comprehensive Income' in one
statement.
The company financial statements are separate financial statements prepared in
accordance with FRS 101. The company is a qualifying entity as defined in FRS
101 and has applied the disclosure exemptions available under FRS 101 in the
preparation of these financial statements.
As permitted by FRS 101, the company has taken advantage of the following
disclosure exemptions:
· A cash flow statement and related notes (IAS 7)
· Comparative information in respect of certain disclosures (IAS 1)
· Disclosure requirements of IFRS 7 (Financial Instruments: Disclosures)
· Disclosure requirements of IFRS 13 (Fair Value Measurement)
· Related party disclosures (IAS 24), where transactions are with wholly-owned
subsidiaries
Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Going concern The Directors have reviewed the approved budget and projections sensitised for
different scenarios through to December 2026, considering general and specific
market conditions, status of suppliers, liquidity and funding requirements and
the needs of subsidiary companies.
The Directors have assessed the viability of the Group using extreme
assumptions to reverse stress test the cash forecast. Assumptions include
extreme reduction in sales, decrease in gross margin, and reduced reduction in
inventory levels (as anticipated in 2025). Additionally, within these
scenarios we have excluded any potential beneficial impacts such as tighter
management of working capital and cost reduction measures. These have been
excluded to retain headroom in the forecast and to provide a worst expected
case scenario. The forecast is that significant cash balances remain within
the Group and there is no borrowing requirement leaving the Directors
confident that the Group will be able to meet its obligations and as such,
there is no material uncertainty over the going concern assumption.
Basis of consolidation The consolidated financial statements incorporate the financial statements of
the Company and its subsidiary undertakings. A subsidiary is a company
controlled directly by the Group. Control is achieved where the Group has the
power over the investee, rights to variable returns and the ability to use the
power to affect the investee's returns.
The acquisition method views a business combination from the perspective of
the combining entity that is identified as the acquirer. The acquirer
recognises the assets acquired and liabilities and contingent liabilities
assumed, including those not previously recognised by the acquiree, where
recognition criteria are met. Measurement of these items is generally at fair
value at acquisition date. The measurement of the acquirer's assets and
liabilities is not affected by the transaction, nor are any additional assets
or liabilities of the acquirer recognised as a result of the transaction,
because they are not the subjects of the transaction. All subsidiaries are
100% wholly owned and are fully controlled by the Group. All intra-Group
transactions, balances, income and expenses are eliminated on consolidation.
Revenue recognition Revenue is recognised by the Group using the five-step process outlined in
IFRS 15:
· Identifying a contract with a customer
· Identifying the performance obligations
· Determining the transaction price
· Allocating the transaction price to the performance obligations
· Recognising revenue when the performance obligations are satisfied
The Group's principal source of revenue is from the sale of single board
computers and associated products (which could include software products which
are required by the customer to be added to the boards sold, for example
security software). Revenue from the sale of products, including any added
software (this is so interlinked with the single board computer (SBC) that
they are considered one performance obligation under IFRS 15), is recognised
when the Group satisfies its performance obligations by transferring the
promised goods to its customers. Control is considered to transfer, at the
point in time, when the customer takes undisputed responsibility for the
goods. This depends on the terms and conditions of sale with the customer.
There are three main terms for delivery: 1) On delivery terms being the Group
is responsible for the goods until delivered at the stated delivery address
under the contract. 2) Free on Board contract terms means the goods remain the
Group's responsibility until they are placed on board the vehicle for
shipping, with export duty being the Group's responsibility as well. The
customer is responsible after this point. 3) Ex-works contract terms, where
the customer is responsible from the point the goods leave the factory or
appropriate site, often, under control of the customer's defined shipping
arrangement.
The Group provides a basic warranty on its products but does offer customers
the opportunity to purchase an extended warranty of one, two or three years
for their boards. As the customer has the option of purchasing the additional
warranty separately, this is accounted for as a separate performance
obligation under IFRS15 where the Group will repair or replace faulty boards
at no additional charge to the customer. Contract liabilities on these
extended warranties is recognised and released to income over the warranty
period until the performance obligation is satisfied. During the 12 months to
31 December 2024, £5,087 was released to Profit and Loss.
Revenue recognised for Systems contracts, under IFRS 15, was £2,132,044 for
2024 accounts. Systems revenue will continue into 2025 and beyond as we are
now a Systems company as well. Revenue will normally be recognised over time,
in accordance with IFRS 15, using the input method based on the percentage of
completion (using costs versus budgeted/forecasts of costs at completion), and
will be dependent on the conditions of each specific contract (in line with
the five-step process above).
The Group's principal source of revenue is from the sale of single board
computers and associated products (which could include software products which
are required by the customer to be added to the boards sold, for example
security software). Revenue from the sale of products, including any added
software (this is so interlinked with the single board computer (SBC) that
they are considered one performance obligation under IFRS 15), is recognised
when the Group satisfies its performance obligations by transferring the
promised goods to its customers. Control is considered to transfer, at the
point in time, when the customer takes undisputed responsibility for the
goods. This depends on the terms and conditions of sale with the customer.
There are three main terms for delivery: 1) On delivery terms being the Group
is responsible for the goods until delivered at the stated delivery address
under the contract. 2) Free on Board contract terms means the goods remain the
Group's responsibility until they are placed on board the vehicle for
shipping, with export duty being the Group's responsibility as well. The
customer is responsible after this point. 3) Ex-works contract terms, where
the customer is responsible from the point the goods leave the factory or
appropriate site, often, under control of the customer's defined shipping
arrangement.
The Group provides a basic warranty on its products but does offer customers
the opportunity to purchase an extended warranty of one, two or three years
for their boards. As the customer has the option of purchasing the additional
warranty separately, this is accounted for as a separate performance
obligation under IFRS15 where the Group will repair or replace faulty boards
at no additional charge to the customer. Contract liabilities on these
extended warranties is recognised and released to income over the warranty
period until the performance obligation is satisfied. During the 12 months to
31 December 2024, £5,087 was released to Profit and Loss.
Revenue recognised for Systems contracts, under IFRS 15, was £2,132,044 for
2024 accounts. Systems revenue will continue into 2025 and beyond as we are
now a Systems company as well. Revenue will normally be recognised over time,
in accordance with IFRS 15, using the input method based on the percentage of
completion (using costs versus budgeted/forecasts of costs at completion), and
will be dependent on the conditions of each specific contract (in line with
the five-step process above).
Revenue recognition (continued) For our single board business, invoices are raised on despatch, with payment
terms being usually 30 days from date of invoice. For the Systems business,
payment terms will be based on negotiations and could include pro-forma and
30-day payment terms but will be subject to negotiated positions.
Cost of sales Cost of sales consists of external purchases and inventory used on delivering
specific contracts, plus the direct manpower (predominantly manufacturing)
related to the fulfilment of the specific contracts and direct ancillary costs
such as shipping.
Administrative expenses This includes all non-direct costs (e.g. general overheads such as rent,
rates, sales and indirect functions). This also includes non-direct
engineering expenses.
Foreign currencies The functional and presentational currency of the Company is pounds sterling
(GBP). Transactions in currencies other than the functional currency of the
individual entities within the Group are recorded at the rates of exchange
prevailing on the dates of the transactions. Foreign exchange gains and losses
resulting from the settlement of such transactions and from the remeasurement
of monetary items at year end exchange rates are recognised in profit or loss.
In the Group's financial statements, all assets, liabilities and transactions
of Group entities with a functional currency other than GBP are translated
into pounds sterling upon consolidation. The functional currencies of the
entities in the Group have remained unchanged during the reporting period.
On consolidation, assets and liabilities have been translated into GBP at the
closing rate at the reporting date. Foreign Exchange differences arising for
intercompany transactions are charged within profit and loss. Income and
expenses have been translated into GBP at the rates of exchange prevailing on
the dates of the transactions over the reporting period. In line with IAS 21,
an average rate is used for the period unless exchange rates fluctuate
significantly and then the weighted average rate is used. Exchange differences
are charged/credited to other comprehensive income and recognised in the
cumulative translation reserve in equity. On disposal of a foreign operation
the cumulative translation differences recognised in equity are reclassified
to profit or loss and recognised as part of the gain or loss on disposal.
Goodwill and fair value adjustments arising on the acquisition of a foreign
entity are treated as assets and liabilities of the foreign entity and
translated into GBP at the closing rate.
Inventories Inventories are stated at the lower of cost and net realisable value on a
first-in first-out basis. Cost includes materials, direct labour and an
attributable proportion of manufacturing overheads based on normal levels of
activity. Net realisable value represents the estimated selling price after
allowing for the costs of realisation and, where appropriate, the cost of
conversion from their existing state into a finished condition. Provision is
made where necessary for obsolete, slow moving or defective inventories.
Leases A lease is defined as a contract, or part of a contract, that conveys the
right to use an asset (the underlying asset) for a period of time in exchange
for consideration. To apply this definition, the Group assesses whether the
contract meets three key evaluations which are whether the contract contains
an identified asset, which is either explicitly identified in the contract or
implicitly specified by being identified at the time the asset is made
available to the Group; the Group has the right to obtain substantially all of
the economic benefits from use of the identified asset throughout the period
of use, considering its rights within the defined scope of the contract; and
the Group has the right to direct the use of the identified asset throughout
the period of use.
At lease commencement the Group recognises a right of use asset and a lease
liability on the statement of financial position. The right of use asset is
measured at cost and initial direct costs incurred by the Group. The right of
use asset is then depreciated on a straight-line basis over the term of the
lease or the estimated useful life of the asset if shorter. At commencement
date the Group measures the lease liability at the present value of the future
lease payments, discounted using the Group's incremental borrowing rate.
The Group has elected to account for short-term leases and leases of low value
assets using the recognition exemptions and payments in relation to these are
recognised as an expense in the appropriate period.
Right of use assets have been included in property, plant and equipment and
the corresponding lease liability included in trade and other payables.
Detailed lease liability information is included in Notes 17 and 20.
Property, plant and equipment Property, plant and equipment is stated at original historical cost, net of
depreciation and any provision for impairment. Depreciation is charged to
write off the cost of assets together with any cost directly attributable with
bringing the asset into use, less estimated residual value, on a straight-line
basis over their estimated useful lives in accordance with the table below:
Plant and machinery 5-15 years on a straight-line basis
Fixtures, fittings, and equipment 3-7 years on a straight-line basis
Computer equipment 3-5 years on a straight-line basis
Improvements to short leasehold property 5-10
years on a straight-line basis
The gain or loss arising on the disposal or retirement of an asset is
determined as the difference between the sales proceeds and the carrying
amount of the asset and is recognised in the statement of comprehensive
income.
The residual values and useful economic lives of property, plant and equipment
are reviewed annually.
Intangible assets All intangible assets are stated at cost less accumulated amortisation and any
accumulated impairment losses.
Goodwill
Goodwill arose upon the acquisition of Phillips Aerospace made on 6 September
2023, which was defined as a single cash generating unit (CGU). The assets
acquired are not capable of individually generating revenue on their own, so
they are deemed combined within the business as a whole to generate revenue,
and therefore the business (Phillips Aerospace) is defined as a single CGU.
The goodwill is the amount attributable to the excess of consideration over
the fair value of the net assets acquired, including expected synergies,
future growth, critical accreditations, and technical knowledge of the
employee, and is recorded in accordance with IFRS 3, 'Business
Combinations'.
Goodwill is reviewed and tested annually for impairment.
Research costs
Research costs are charged directly to administrative expense in the statement
of comprehensive income as incurred.
Development costs
Development costs are capitalised as intangible assets if the asset can be
separately identified; it is in the control of the Group; future economic
benefits will accrue to Group; it is technically feasible; the Group has
adequate resources to complete the development of the asset; and the costs can
be reliably determined.
Capitalised development costs comprise all directly attributable costs
necessary to create, produce and prepare the asset to be capable of operating
in the manner intended by management, including development-related overheads.
Amortisation commences upon completion of the development or when the asset
becomes available for commercial production. Capitalised development costs are
amortised on a straight-line basis, over the estimated product life which is
generally five to seven years. The asset will be reviewed annually for
indicators of impairment and whenever indicators suggest that the carrying
amount may not be recovered throughout the period in which it is being used,
the asset will be subject to a full impairment review. All intangible assets,
including those not yet available for use, will be reviewed for indicators of
impairment.
All other development costs are recorded under administrative expense in the
statement of comprehensive income in the period they are incurred. The
following table shows products with a NBV of £500k or more:
Product NBV Remaining Amortisation Period
Board A 2,509,122 84 months
Board B 1,372,992 84 months
Board C 1,079,818 84 months
Board D 745,697 84 months
Customer relationships
Customer relationships were acquired as part of the acquisition of Phillips
Aerospace on 6 September 2023 and have applied an income approach valuation
using the multi period excess earning method with a useful economic life of 10
years.
Other intangible assets
Intangible assets purchased separately, such as software licences that do not
form an integral part of hardware, are capitalised at cost and amortised over
their useful lives of three to seven years.
The carrying values of intangible assets with finite lives are reviewed for
impairment when events or changes in circumstance indicate the carrying value
may be impaired. If any such indication exists, the recoverable amount of the
asset is estimated to determine the extent of impairment loss.
The recoverable amount of the asset will be used as for all other intangible
assets (e.g. backlog and pipeline opportunities), except where the asset does
not generate independent cashflows i.e. additional software packages sold as
an add-on to a board.
Impairment of property, plant and equipment, and intangible assets At each statement of financial position date, the Group reviews the carrying
amounts of its tangible and intangible assets to determine whether there is
any indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated to
determine the extent of the impairment loss.
Recoverable amount is the higher of fair value less costs to sell and value in
use. In assessing value in use, the estimated future cash flows (using both
backlog and weighted pipeline) are discounted (10.2% rate used) to their
present value. If the recoverable amount of an asset is estimated to be less
than its carrying amount, the carrying amount of the asset is reduced to its
recoverable amount. An impairment loss is immediately recognised as an expense
in the statement of comprehensive income.
Where an impairment loss subsequently reverses, the carrying amount of the
asset is increased to the revised estimate of its recoverable amount, but so
that the increased carrying amount does not exceed the carrying amount that
would have been determined had no impairment loss been recognised for the
asset in prior years. A reversal of an impairment loss is recognised as a
credit to expenses immediately.
Taxation Current tax is the tax currently payable based on taxable profit for the year.
Current tax for current and prior periods shall, to the extent unpaid, be
recognised as a liability. If the amount already paid in respect of current
and prior periods exceeds the amount due for those periods, the excess shall
be recognised as an asset.
The tax expense for the period comprises current and deferred tax. Tax is
recognised in the income statement, except to the extent that it relates to
items recognised in other comprehensive income, or directly in equity. In this
case, the tax is also recognised in other comprehensive income or directly in
equity, respectively.
The Group takes advantage of the Small & Medium Enterprise tax scheme in
respect of R&D tax credits. These are included in the taxation line and
are accounted for on a receivable basis. This means that the Group applies
certain assumptions based on previous R&D claims and any changes to the
business and applicable legislation to record a credit through profit or loss
and an associated receivable on the statement of financial position in the
accounting period in question.
Deferred income taxes are calculated using the liability method on temporary
differences. Deferred tax is generally provided on the difference between the
carrying amounts of assets and liabilities and their tax bases. However,
deferred tax is not provided on the initial recognition of goodwill, nor on
the initial recognition of an asset or liability unless the related
transaction is a business combination or affects tax or accounting profit.
Deferred tax on temporary differences associated with shares in subsidiaries
is not provided if reversal of these temporary differences can be controlled
by the group and it is probable that reversal will not occur in the
foreseeable future. In addition, tax losses available to be carried forward as
well as other income tax credits to the Group are assessed for recognition as
deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting. Deferred
tax assets are recognised to the extent that it is probable that the
underlying deductible temporary differences will be able to be offset against
future taxable income. Current and deferred tax assets and liabilities are
calculated at tax rates that are expected to apply to their respective period
of realisation, provided they are enacted or substantively enacted at the
year-end date.
Financial instruments Financial assets and financial liabilities are recognised in the statement of
financial position when the Group becomes a party to the contractual
provisions of the instrument.
i. Financial Assets
Financial assets are held at amortised cost if the assets are held with the
objective to collect contractual cash flows and where the contractual terms of
the financial assets give rise to cash flows that are solely payments of
principal and interest on the principal amount outstanding. After initial
recognition at transaction price being the amount of consideration that is
unconditional, receivable balances are measured at amortised cost using the
effective interest method, less loss allowance for expected credit losses. The
Group's cash and cash equivalents, other financial assets (fixed term
deposits), trade and most other receivables fall into this category of
financial instruments.
The Group applies the IFRS 9 simplified approach to measuring expected credit
losses which uses a lifetime expected loss allowance for all trade
receivables.
Financial instruments (continued) i. Financial liabilities
Trade and other payables are not interest bearing and are initially recognised
at fair value plus transaction costs directly attributable to their
acquisition and then subsequently measured at amortised cost.
ii. Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the
substance of the contractual arrangements entered into. Financial liabilities
are obligations to pay cash or other financial assets and are recognised when
the Group becomes a party to the contractual provisions of the instrument.
They are initially recognised at fair value plus transaction costs directly
attributable to their acquisition and subsequently measured at amortised cost
using the effective interest method. An equity instrument is any contract that
evidences a residual interest in the assets of the Group after deducting all
of its liabilities.
Investments in subsidiaries Investments in subsidiaries, as reported in the Parent Company financial
statements, are included at cost less provision for impairment.
Finance income Finance income comprises interest income accrued on a time basis, by reference
to the principal outstanding at the effective interest rate applicable.
Dividends Dividends to the Company's shareholders are recognised as a liability and
deducted from shareholders' equity in the period in which the shareholders'
right to receive payment is established.
Employee benefits Retirement benefits
The Company operates a defined contribution retirement benefit plan. The cost
of the defined contribution plan is charged to administrative expenses in the
statement of comprehensive income on the basis of contributions payable by the
Company during the year.
Share-based payments
The Group issues equity-settled, share-based payments to certain employees.
Equity-settled, share-based payments are measured at fair value at the date of
grant. In the consolidated Financial Statements, the fair value determined at
the grant date of equity-settled, share-based payments is expensed on a
straight-line basis over the vesting period based on the Group's estimate of
shares which will eventually vest, together with a corresponding increase in
equity. In the Financial Statements of the Company, equity-settled,
share-based payments issued to employees of the Company are treated in the
same manner as in the consolidated Financial Statements. Equity-settled,
share-based payments issued to employees of subsidiary undertakings are
treated in the Financial Statements of the Company as an increase in
investment in subsidiary companies, together with a corresponding increase in
equity, over the vesting period based on the Group's estimate of shares which
will eventually vest.
Fair value is measured by use of a binomial option pricing model and has been
adjusted for the estimated effect of non-transferability, exercise
restrictions and behavioural considerations.
For options that have non-market vesting conditions such as EPS growth, the
award has been valued using a Black-Scholes Model. This type of model is
typically used where no market conditions are associated with the awards.
Options granted from November 2021 have been valued using the Black-Scholes
Model. Option pre-November 2021 used the binomial option pricing model.
Treasury shares The Company's shares which have been purchased and not cancelled are held as
treasury shares and deducted from shareholders' equity. No gain or loss is
recognised in profit or loss on the purchase, sale, issue or cancellation of
the shares.
Reserves Share premium account represents the difference between the price received on
the sale of shares and their par value.
Capital redemption reserve arose from the purchase of shares and represents
their nominal value.
Cumulative translation reserve arises from the consolidation of foreign
subsidiaries.
Share capital represents the nominal value of shares that have been issued.
Profit and loss account includes all current and prior period retained profits
and share-based payments less treasury shares held at the statement of
financial position date.
Merger reserve represents the difference between the price of the shares
issued on acquisition of Phillips Aerospace and their par value.
Provisions Provisions are recognised when present obligations resulting from a past event
will probably lead to an outflow of economic resources from the Group and
amounts can be estimated reliably. Provisions reported are for non-purchased
warranties (all additional purchased warranties are accounted for under
contract liabilities). The obligation under IFRS15 is for the Group to repair
or replace faulty boards at no additional charge to the customer.
EPS Basic earnings per share is calculated by dividing the profit attributable to
the owners of Concurrent Technologies plc, excluding any costs of servicing
equity other than ordinary shares, by the weighted average number of ordinary
shares outstanding during the financial year.
Diluted earnings per share is calculated by dividing the profit attributable
DEPS to the owners of Concurrent Technologies plc, excluding any costs of servicing
equity other than ordinary shares, by the weighted average number of ordinary
shares and share options outstanding during the financial year.
Key judgements and estimates Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectation of future events that are
believed to be reasonable under the circumstances.
Estimates
The resulting accounting estimates will, by definition, seldom equal the
related actual results. The estimates and assumptions that have a significant
risk of creating a material adjustment to the carrying amounts of assets and
liabilities are discussed below.
Development costs
To determine whether an impairment is required regarding the carrying value of
the capitalised development costs, management have applied the criteria of IAS
36 'Impairment of Assets' and have projected the future economic benefits of
the asset. Reviewing against current backlog and estimated weighted, (based on
probability factors, predominantly driven by stage of the opportunity), future
pipeline opportunities, which will be achieved from this investment using an
estimated useful life of seven years. Management considers the review to be
sufficiently robust regarding reasonable movements in discount rates (current
rate used 10.2%).
A 1% increase in the discount rate would not lead to a material increase in
impairment, so therefore, the discount rate is not considered to be the key
source of estimation uncertainty, but it is the assumptions made around
conversion of future sales that is key to the estimate. Where indicators
exist, management then record judgement-based impairment charges which
consider project specific technical issues, customer feedback, opportunity for
product substitution and other market factors. Estimation uncertainty relates
to assumptions about future results.
The Group has performed a sensitivity analysis against our top five boards in
terms of NBV, using the key input of gross margin, and the result is the gross
margin would have to reduce between 50% and 70%, depending on the board, to
achieve a breakeven position. This provides the Directors with comfort in
respect of headroom in the impairment calculations.
Inventory
A slow moving inventory provision has been made where necessary where
inventory has had no movement in three years or more as per our accounting
policy. Items that are provided for, should they start being used again, will
have the provision removed/reversed.
R&D Tax Credits
The Group takes advantage of the Small & Medium Enterprise tax scheme in
respect of R&D tax credits. These are included in the taxation line and
are accounted for on a receivable basis. This means that the Group applies
certain assumptions based on previous R&D claims and any changes to the
business and applicable legislation to record a credit through profit or loss
and an associated receivable on the statement of financial position in the
accounting period in question.
Goodwill and intangible assets on acquisition
Application of IFRS 3
During the prior year, the Group acquired Phillips Aerospace and accordingly
reviewed the acquisition of the entity in accordance with IFRS 3 'Business
Combinations'. Any assets that were identified as being separately
identifiable assets have been valued using appropriate valuation techniques in
order to determine the fair value of intangible assets acquired as part of the
business combination aside from any goodwill arising as a result of the
transaction.
These are accordingly recorded as separate intangible assets in Note 12 and
have been reviewed for impairment as noted in Note 12.
CGU
The classification of Phillips Aerospace as a single CGU is a key judgement
based on the understanding of the elements that were purchased. The assets
purchased (e.g., accreditation, customer relationships, working capital etc.)
are not capable of generating revenue in their own right, individually, and
therefore, they are judged to be intrinsically linked as one to define the
business of Phillips Aerospace to be one single CGU. Accordingly, any goodwill
arising as a result of this acquisition has been allocated to the CGU
identified.
The subsequent impairment and amortisation of the goodwill and assets are
based on key estimates and judgements, reviewing the capability of the
business from key forecasts of revenue and orders. These are tested for
impairment in the same way as development costs (i.e. the use of a discounted
cashflow forecast to determine the value in use of the CGU, which has been
prepared in accordance with IAS 36).
Capitalisation of development costs IAS 38 - Intangible Assets
Judgement is required when distinguishing the research and development phases
of new projects and determining whether the recognition requirements for
capitalisation of the development costs are met under IAS 38. Research covers
pre-solution options often through feasibility studies of various
technologies. Development is the application of research findings or other
knowledge to plan or design for the production of new or substantially
improved products before the start of commercial production. Development costs
are capitalised as an intangible asset if all the following criteria are met:
there is technical feasibility of completing the asset so that it will be
available for use or sale; the intention is to complete the asset and use or
sell it; there is an ability to use or sell the asset; the asset will generate
future economic benefits and demonstrate the existence of a market or the
usefulness of the asset if it is to be used internally; the availability of
adequate technical, financial and other resources to complete the development
and to use or sell it; and the ability to measure reliably the expenditure
attributable to the intangible asset.
Key judgements and estimates (continued) Judgements
Judgement is required when distinguishing the research and development phases
of new projects and determining whether the recognition requirements for
capitalisation of the development costs are met. Research covers pre-solution
options often through feasibility studies of various technologies. Development
is the application of research findings or other knowledge to plan or design
for the production of new or substantially improved products before the start
of commercial production. Development costs are capitalised as an intangible
asset if all the following criteria are met: there is technical feasibility of
completing the asset so that it will be available for use or sale; the
intention is to complete the asset and use or sell it; there is an ability to
use or sell the asset; the asset will generate future economic benefits and
demonstrate the existence of a market or the usefulness of the asset if it is
to be used internally; the availability of adequate technical, financial and
other resources to complete the development and to use or sell it; and the
ability to measure reliably the expenditure attributable to the intangible
asset.
Prior year restatement
Corporation tax
A prior year restatement has been included for corporation tax as a result of
an erroneous tax asset being included in the 2023 accounts. The impact of this
adjustment is to increase the tax charge in 2023 by £713,000 and decrease the
corporation tax asset in 2023 by £713,000.
2023 (restated) 2023 as previously stated
Tax (charge)/credit (312,752) 400,248
Current tax asset 779,621 1,492,621
Profit and loss reserve 22,100,348 22,813,348
Earnings per share 4.06p 4.98p
Diluted earnings per share 3.95p 4.85p
Profit and loss impact 713,000
Cumulative retained earnings impact 713,000
Note 3 SEGMENT REPORTING
The Directors consider that there is only one operating segment, Concurrent
Group, which undertakes the design, manufacture and supply of high-end
embedded computer products and systems. The Company's products can be supplied
to more than one business sector and are sold on a global basis. All
manufacturing of computer products is undertaken in the UK.
Whilst looking at sales by business sectors, the Executive Board members of
the Company as the Chief Operating Decision Maker do not make decisions
regarding allocation of Group resources on such a basis.
The Board in its entirety, i.e. including Non-Executive members, is not
involved in making operational decisions. Further, Group profits are not
categorised for internal reporting purposes by sectors or geography. The
historical and anticipated performance of the Group is therefore reported to
the Board of Concurrent Technologies plc as a single entity. Thus, the
Directors consider that there are no additional segments required to be
disclosed under IFRS 8 - Operating Segments but have provided the following
geographic sales analysis. No geographical analysis of non-current assets is
provided as non-current assets outside of the UK are immaterial.
During 2024, £5.9m or 15% of Group Revenue depended on a single customer. In
2023, £3.49m or 11.0% of Group Revenue depended on a single customer.
All board revenue is recognised at a point in time, with systems and warranty
(immaterial) revenue recognised over time.
Revenue Year to Year to
31 December 31 December
2024 2023
£ £
United States 18,333,933 13,060,691
Malaysia 1,782,697 392,850
Germany 3,614,506 6,450,372
United Kingdom 2,929,047 2,148,568
Other Europe 8,146,423 4,178,401
Rest of the World 5,517,477 5,425,434
40,324,083 31,656,316
Note 4 GROUP OPERATING PROFIT
Year to Year to
31 December 2024 31 December 2023
£ £
Group operating profit is stated after charging to cost of sales:
Cost of inventories recognised as expense 18,393,779 14,884,586
Staff costs (see Note 10) 2,244,166 1,133,781
Group operating profit is stated after charging/(crediting) to operating
expenses:
Net foreign exchange (gains)/losses (303,144) 279,491
Total expensed research and development costs 2,573,902 1,930,389
Amortisation of intangible assets 1,936,561 1,509,167
Impairment of intangible assets 4,088 31,557
Depreciation of owned property, plant and equipment 468,683 686,403
Depreciation of ROU Asset 204,374 203,870
Staff costs (see Note 10) 10,540,722 9,002,640
Group principal auditor's remuneration:
Audit of Group financial statements pursuant to legislation 158,300 150,000
Other non-auditor remuneration relating to taxation compliance 39,200 25,000
Note 5 FINANCE INCOME
Year to Year to
31 December 2024 31 December 2023
£ £
Interest earned on bank deposits 79,294 68,145
Note 6 TAX
Year to Year to
31 December 31 December
2024 2023 (as restated)
£ £
Current tax expense - -
Current deferred tax 1,014,506 401,271
Prior year tax expense (17,007) (4,970)
Prior year deferred tax (520,660) (113,969)
Current overseas tax charge - 30,420
476,839 312,752
The tax assessed on the Group's profit before tax for the year is less than
the standard rate of corporation tax in the UK. The applicable rate of
corporation tax for the year to 31 December 2024 was 25.00% (2023: 23.52%).
The differences are explained below:
Year to Year to
31 December 31 December
2024 2023 (as restated)
£ £
Profit before tax 5,179,277 3,472,888
Corporation tax on profit before tax at standard rate 1,294,819 816,823
Expenses not deductible for tax purposes 13,771 282,141
UK tax credits (731,734) (486,705)
Effect of change in UK tax rate - 23,747
Share options 4,736 -
Effects of other reliefs - -
Difference in overseas effective tax rates - (24,150)
Impact of overseas losses 432,914 -
Adjustment in respect of previous years (537,667) (299,104)
Tax charge/(credit) 476,839 312,752
Factors that may affect future tax charges are as follows:
UK tax rates, and any changes to R&D tax credits would have an impact on
the tax position of the Group and Parent company
Note 7 DIVIDEND
2024 2023 2024 2023
pence per pence per
£ £ share share
Final (for the previous year) 856,377 - 1.00 -
Interim - - - -
856,377 - 1.00 -
Interim dividends are recognised in the Financial Statements in the period
they are paid. The Directors have proposed a 1.1p dividend for the year ended
31 December 2024 as a resolution for the Annual General Meeting (total
dividend for 2023 was £856,377).
Note 8 EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit attributable to
ordinary equity holders for the period by the weighted average number of
Ordinary Shares outstanding during the period. Diluted earnings per share is
calculated by adjusting the weighted average number of Ordinary Shares
outstanding to assume conversion of all contracted dilutive potential Ordinary
Shares. The Company only has one category of dilutive potential Ordinary Share
namely the share options.
The inputs to the earnings per share calculation are shown below:
Year to Year to
31 December 31 December
2024 2023 (as restated)
£ £
Profit after tax 4,702,438 3,160,136
Year to Year to
31 December 31 December
2024 2023
N(o) N(o)
Weighted average number of ordinary shares for basic earnings per share 85,676,344 77,833,759
Adjustment for share options 5,106,393 4,554,202
90,782,737 82,387,961
Year to Year to
31 December 31 December
2024 2023 (as restated)
Earnings per share amount 5.49p 4.06p
Diluted earnings per share amount 5.18p 3.95p
Note 9 DIRECTORS' EMOLUMENTS
Year to Year to
31 December 31 December
2024 2023
£ £
Fees and emoluments 1,295,912 1,182,172
Pension contributions 16,298 18,632
1,312,210 1,200,804
The emoluments of Directors disclosed above include in respect of the highest
paid Director:
Fees and emoluments 614,719 571,029
Pension contributions - 9,847
The number of Directors to whom retirement benefits are accruing under a 1 2
defined contribution scheme is:
Detailed information concerning Directors' emoluments, shareholdings and
options is provided in the Report of the Remuneration Committee.
NOTE 10 STAFF COSTS
STAFF COSTS Group Company Group Company
Year to Year to Year to Year to
31 December 31 December 31 December 31 December
2024 2024 2023 2023
£ £ £ £
Wages and salaries 10,160,327 7,822,904 8,501,442 7,055,210
Social security costs 1,277,769 985,571 958,837 867,527
Defined contribution pension costs 602,037 547,017 438,431 418,231
Share-based payment 744,755 370,083 430,854 283,761
12,784,888 9,725,575 10,329,564 8,624,729
Average number of employees: N(o) N(o) N(o) N(o)
Production 40 39 39 38
Other 115 89 103 88
155 128 142 126
Direct employment costs capitalised for the year to 31 December 2024
£2,656,170 (2023: £2,389,672).
Note 11 PROPERTY, PLANT AND EQUIPMENT
GROUP Improvements to short leasehold property Plant, fixtures & computer equipment
Right of use asset Total
£ £ £ £
COST
At 1 January 2023 784,169 1,497,157 4,405,590 6,686,916
Foreign exchange movement (6,251) - (8,624) (14,875)
Modification and amendment - (234,905) - (234,905)
Transfer from intangibles - - 75,045 75,045
Additions 227,733 - 523,184 750,917
At 31 December 2023 1,005,651 1,262,252 4,995,195 7,263,098
Foreign exchange movement (2,018) (2,785) (4,803)
Additions 28,629 868,482 897,111
At 31 December 2024 1,032,262 1,262,252 5,860,892 8,155,406
ACCUMULATED DEPRECIATION
At 1 January 2023 260,028 451,828 3,289,953 4,001,809
Foreign exchange movement (5,193) 1,651 (7,288) (10,830)
Charge for the year 252,370 203,870 434,033 890,273
Modification and amendment - (84,037) - (84,037)
At 31 December 2023 507,205 573,312 3,716,698 4,797,215
Foreign exchange movement (1,067) 533 (1,105) (1,639)
Charge for the year 121,182 204,374 347,501 673,058
At 31 December 2024 627,320 778,219 4,063,094 5,468,634
NET BOOK VALUE
At 31 December 2023 498,446 688,940 1,278,497 2,465,883
At 31 December 2024 404,942 484,033 1,797,797 2,686,772
COMPANY Improvements to short leasehold property Plant, fixtures & computer equipment
Right of use
asset Total
£ £ £ £
COST
At 1 January 2023 780,351 1,400,165 4,255,588 6,436,104
Transfer from intangibles 75,045 75,045
Modification and amendment - (234,905) - (234,905)
Additions 60,672 - 303,337 364,009
At 31 December 2023 841,023 1,165,260 4,633,970 6,640,253
Additions 28,629 - 684,704 713,333
At 31 December 2024 869,652 1,165,260 5,318,674 7,353,586
ACCUMULATED DEPRECIATION
At 1 January 2023 256,209 401,478 3,149,917 3,807,604
Charge for the year 94,546 186,393 261,538 542,477
Modification and amendment - (84,037) - (84,037)
At 31 December 2023 350,755 503,834 3,411,455 4,266,044
Charge for the year 96,452 187,443 334,858 618,753
At 31 December 2024 447,207 691,277 3,746,313 4,884,797
NET BOOK VALUE
At 31 December 2023 490,268 661,426 1,222,515 2,374,209
At 31 December 2024 422,445 473,983 1,572,361 2,468,789
Note 12 INTANGIBLE ASSETS
GROUP
Development Customer
costs Goodwill relationships Other Total
£ £ £ £ £
COST
At 1 January 2023 31,061,443 1,109,461 32,170,904
Foreign exchange movement - (1,106) (1,106)
Additions 3,939,539 38,300 3,977,839
Additions on acquisition - 1,230,594 1,130,851 383,593 2,745,038
Transfer between classes (64,413) - - 64,413 -
Transfer to tangibles (75,046) - - - (75,046)
At 31 December 2023 34,861,523 1,230,594 1,130,851 1,594,661 38,817,629
Foreign exchange movement - 19,690 17,513 - 37,203
Additions 3,043,265 - - 339,260 3,382,525
Adjustment - - - - -
At 31 December 2024 37,904,787 1,250,284 1,148,364 1,933,921 42,237,356
AMORTISATION
At 1 January 2023 22,477,838 885,776 23,363,614
Foreign exchange movement - (1,106) (1,106)
Charge for the year 1,349,203 36,248 123,716 1,509,167
Impairment loss 31,557 31,557
At 31 December 2023 23,858,598 - 36,248 1,008,386 24,903,232
Foreign exchange movement 1,268 1,268
Charge for the year 1,685,441 114,895 136,225 1,936,561
Impairment loss 4,088 4,088
At 31 December 2024 25,548,127 - 151,143 1,145, 879 26,845,149
At 31 December 2023 11,002,925 586,275 13,914,397
1,230,594 1,094,603
At 31 December 2024 12,356,661 1,250,284 997,221 788,042 15,392,208
COMPANY
Development
costs Other Total
£ £ £
COST
At 1 January 2023 31,061,443 1,109,461 32,170,904
Transfer between classes (64,413) 64,413 -
Additions 3,939,539 38,300 3,977,839
Transfer to tangibles (75,046) - (75,046)
At 31 December 2023 34,861,523 1,212,174 36,073,697
Additions 3,043,265 321,820 3,365,085
Adjustment - 5,398 5,398
Disposals - - -
At 31 December 2024 37,904,787 1,539,392 39,444,180
AMORTISATION
At 1 January 2023 22,477,838 885,776 23,363,614
Foreign exchange movement - - -
Charge for the year 1,349,203 111,420 1,460,623
Disposals -
Impairment loss 31,557 31,557
At 31 December 2023 23,858,598 997,196 24,855,794
Charge for the year 1,685,441 110,015 1,795,456
Disposals -
Impairment loss 4,088 4,088
At 31 December 2024 25,548,126 1,107,211 26,655,338
At 31 December 2023 11,002,925 214,978 11,217,903
At 31 December 2024 12,356,661 432,181 12,788,842
Development costs can be broken down as assets under development (based on
original cost) £3,282,211 (2023: £7,428,960) and assets available for use
(based on original cost) £34,622,576 (2023: £27,432,563). Transferred in
available for use was £nil (2023: £1,088,920).
Other intangible assets comprise purchased software used within the business
and software licences.
All amortisation and impairment charges (or reversals if any) are included
within 'Administrative Expenses'.
In respect of Intangibles associated with the acquisition of Phillips
Aerospace, Concurrent has undertaken an impairment review, with key inputs of
revenue growth and costs, using a discount rate of 10.2%. The results of this
are that a significant reduction in revenue would have to be incurred to
result in any impairment to the assets.
Note 13 DEFERRED TAX
Share- Accelerated
based capital Tax
payments allowances losses Other Total
£ £ £ £ £
GROUP
At 1 January 2023 401,945 (2,222,539) 37,799 6,960 (1,775,835)
Credited/(charged) to statement of comprehensive income 88,785 121,376 215,538 - 425,699
Credited/(charged) to equity - - - (311,317) (311,317)
At 31 December 2023 490,730 (2,101,163) 253,337 (304,357) (1,661,453)
Credited/(charged) to statement of comprehensive income 63,848 (978,982) 421,289 26,214 (467,631)
Credited/(charged) to equity 5,820 - - - 5,820
At 31 December 2024 560,398 (3,080,145) 674,626 (278,143) (2,123,264)
COMPANY
At 1 January 2023 401,945 (2,229,825) - - (1,827,880)
Credited/(charged) to statement of comprehensive income 88,785 121,376 215,538 - 425,699
Credited/(charged) to equity - - - - -
At 31 December 2023 490,730 (2,108,449) 215,538 - (1,402,181)
Credited/(charged) to statement of comprehensive income 63,848 (978,982) 421,289 - (493,845)
Credited/(charged) to equity 5,820 5,820
At 31 December 2024 560,398 (3,087,431) - 636,827 - (1,890,206)
There has been a reclassification in 2023 of deferred tax asset to show net of
the deferred tax liability because all deferred tax assets and liabilities
arise in offsettable jurisdictions. As a result, deferred tax assets of
£432,642 in 2023 are now presented within the overall net deferred tax
liability.
Note 14 INVESTMENTS
COMPANY 31 December 31 December
2024 2023
£ £
Investment in subsidiary companies
Shares at cost 19,705 19,705
Capital contribution 1,361,656 1,361,656
Equity-settled share-based payment 565,951 191,278
Total investment in subsidiary companies 1,947,312 1,572,639
The Group has closed the Research and Development facility located in India.
The investment in the subsidiary company has not been impaired during 2024.
This will be impaired in 2025 upon formal dissolution. The investment carried
in the accounts is £12,994.
Subsidiary undertakings included in these accounts, which are all wholly
owned, at 31 December 2024 are:
Place of Class of Percentage Nature
Name incorporation share held of business
By Company:
Concurrent Tech Bangalore, Ordinary 99.999 per cent Non-trading
India Private Ltd India Company
Concurrent California, Ordinary 100 per cent Sale & service of Company products
Technologies Inc. USA & R&D services for the Company
By Concurrent Technologies Inc :
Omnibyte Illinois, Ordinary 100 per cent Dormant
Corporation USA
Phillips Aerospace California Ordinary 100 per cent Developer & manufacturer of industrial
USA products and associated services
Note 15 INVENTORIES
Group Company Group Company
31 Dec 31 Dec 31 Dec 31 Dec
2024 2024 2023 2023
£ £ £ £
Raw materials 6,948,808 6,168,144 8,357,855 8,153,919
Work in progress 3,640,455 3,640,455 3,407,901 3,407,901
Finished goods 286,353 286,353 192,744 192,744
10,875,616 10,094,952 11,958,500 11,754,564
During 2024 the provision for obsolete and slow-moving inventories has been
increased by £74,719 (2023: increased by £543,686). In accordance with IAS2,
inventories are measured at the lower of cost and net realisable value.
The inventory balance movement includes a write-off provision which has
decreased by £237,384 in the period. This comprises obsolete inventory
following an in-depth analysis of the Group's inventory.
In 2024, a total of £18.4m (2023: £14.8m) of inventories was included in the
Consolidated Statement of Comprehensive Income as an expense.
Note 16 TRADE AND OTHER RECEIVABLES
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Current
Trade receivables 6,196,812 2,183,749 5,430,181 2,667,667
Prepayments and accrued income 1,550,741 1,359,050 687,535 577,182
Other debtors 356,559 356,559 325,111 325,111
Loan to subsidiary - - - 2,786,644
Amounts due from subsidiary undertakings - 5,080,739 - 2,178,391
8,104,112 8,980,097 6,442,827 8,534,995
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Non-current
Loan to subsidiary - 3,301,753 - -
- 3,301,753 - -
The formal loan agreement for the loan to subsidiary was signed in 2024 and
the loan has a repayment date of September 2028. Therefore, the loan balance
has been reclassified to non-current receivables.
The group applies the IFRS 9 simplified approach to measuring expected credit
losses which uses a lifetime expected loss allowance for all trade
receivables. Trade receivables have been grouped based on shared credit risk
characteristics. The expected loss rates are based on historic performance, as
well as current macroeconomic conditions and experience. The Company has
assessed the recoverability of inter-company balances, and deem no issues in
terms of credit losses, with all amounts being repayable on demand. There have
been no previous write-offs of inter-company balances and there are sufficient
cash and other current assets to cover the amount.
ECL Provision Matrix
31 December 2024 Current More than More than More than Total
30 days 60 days 90 days
past due past due past due
Expected loss rate - - - 0.001%
Gross carrying amount 4,525,345 552,964 741,415 377,088 6,196,812
Lifetime expected credit loss - - - 210 210
As a Group we don't have a significant amount of bad debt and, historically,
bad debts have been very close to nil due to the recurring nature of orders;
our customers pay what is owed, so it is not necessary for us to provide for
any balances as bad debt.
Group Group
2024 2023
£ £
At 1 January 210 210
Charged/(credited) to statement of comprehensive income - -
At 31 December 210 210
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
More than 30 days 552,964 398,653 18,712 17,998
More than 60 days 741,415 531,201 128,551 128,448
More than 90 days 377,088 257,731 125,876 125,096
1,671,467 1,187,585 273,139 271,542
Note 17 TRADE AND OTHER PAYABLES
Current Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Trade payables 5,052,348 4,469,106 5,707,674 5,608,259
Contract liabilities 588,213 588,213 1,030,449 1,030,449
Other payables 117,589 102,878 355,549 46,329
Current right of use lease liability 310,182 287,746 294,662 268,472
Other taxes and social security costs 277,102 267,953 207,385 202,605
Accruals 2,595,334 1,295,952 2,070,693 1,733,933
8,940,768 7,011,848 9,666,412 8,890,047
Non-Current Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Right of use liability 446,477 428,913 695,272 677,607
446,477 428,913 695,272 677,607
Contract liabilities have been disaggregated from other payables in the
current and prior years to provide more detailed information to the reader of
the accounts as to the nature of other payables.
Contract liabilities Warranty End of End of Non- Total
(Group and Company) life life recurring
service engineering
charge
B/fwd as 1 January 2024 49,244 590,936 584 389,685 1,030,449
Charged/(credited) to profit or loss
Addition 16,724 - - - 16,724
Release (5,087) (63,605 ) (584) (389,685) (458,961)
Closing at 31 December 2024 60,882 527,331 - - 588,213
Note 18 FINANCIAL INSTRUMENTS
Financial Instruments by category
Financial assets measured at amortised cost
£
GROUP
2023 Non-current: -
2023 Current:
Trade and other receivables 5,430,181
Cash and cash equivalents 11,118,728
Total for category 16,548,909
2024 Non-current: -
2024 Current:
Trade and other receivables 6,196,812
Cash and cash equivalents 13,706,703
Total for category 19,903,515
Financial liabilities measured at amortised cost
£
GROUP
2023 Current:
Trade and other payables 8,428,578
2024 Current:
Trade and other payables 8,075,453
Included in the above is trade payables, other payables, accruals and lease
liabilities. All non-current liabilities as displayed in Note 17 relate to
lease liabilities which are financial liabilities measured at amortised
cost.
Note 19 PROVISIONS
GROUP AND COMPANY Dilapidation Product
£ warranty
£
Carrying amount at 1 January 2024 296,879 36,512
Charged to profit or loss
Increase in provisions 11,461 -
Amount utilised - -
Carrying amount at 31 December 2024 308,340 36,512
Provisions have been analysed between current and non-current as follows:
Current 18,256
Non-current 326,596
Warranties are provided for based on past experience and on the basis of
management's best estimate of the Group's liability under 24-month warranties
granted on its hardware products.
Dilapidations are provided for on the basis of management's best estimate for
both the Colchester and Theale offices. This is recognised over the life of
each lease.
Note 20 LEASES AND COMMITMENTS
The Group leases properties for its operations in the UK and US and the
information is presented below, all leases relate to property.
Changes in liabilities arising from financing activities Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Opening balance 989,935 946,079 1,460,107 1,391,449
Additions - - - -
Modifications and amendment - - (265,325) (265,325)
Payments (326,514) (286,410) (301,219) (269,641)
Interest 86,166 56,990 103,008 89,596
Foreign exchange 7,072 - (6,636) -
Closing balance 756,659 716,659 989,935 946,079
Right of use assets
Group Company
2024 2024
£ £
Opening balance 688,940 661,426
Additions - -
Depreciation (204,374) (187,443)
Foreign exchange (533) -
Closing balance 484,033 473,983
The right of use in relation to leasehold property are disclosed as PPE (Note
11).
Leases are made up of three properties with the terms as follows: UK office
(Colchester) has no remaining break clauses; UK office (Theale) has a break
clause of 1st April 2028; US office has an annual automatic one-year extension
unless notice is given.
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Within one year (365,566) (325,462) (357,040) (325,462)
Within 2-6 years (453,424) (453,424) (757,806) (739,386)
Add unearned interest 62,331 62,227 124,911 118,769
(756,659) (716,659) (989,935) (946,079)
Non-current Note 17 (446,477) (428,913) (695,273) (677,607)
Current Note 17 (310,182) (287,746) (294,662) (268,472)
(756,659) (716,659) (989,935) (946,079)
Right of use assets
Group Company
2024 2024
£ £
Opening balance 688,940 661,426
Additions - -
Depreciation (204,374) (187,443)
Foreign exchange (533) -
Closing balance 484,033 473,983
The right of use in relation to leasehold property are disclosed as PPE (Note
11).
Leases are made up of three properties with the terms as follows: UK office
(Colchester) has no remaining break clauses; UK office (Theale) has a break
clause of 1st April 2028; US office has an annual automatic one-year extension
unless notice is given.
Group
Company
Group
Company
2024
2024
2023
2023
£
£
£
£
Within one year
(365,566)
(325,462)
(357,040)
(325,462)
Within 2-6 years
(453,424)
(453,424)
(757,806)
(739,386)
Add unearned interest
62,331
62,227
124,911
118,769
(756,659)
(716,659)
(989,935)
(946,079)
Non-current Note 17
(446,477)
(428,913)
(695,273)
(677,607)
Current Note 17
(310,182)
(287,746)
(294,662)
(268,472)
(756,659)
(716,659)
(989,935)
(946,079)
At 31 December 2024 the Group was committed to a short-term lease for the
Phillips Aerospace office lease.
The Group has elected not to recognise a lease liability for short-term leases
or for leases of low-value assets. Payments made on these leases are expensed
on a straight-line basis and the value of these expenses in the year was
£198,735.
Amounts recognised in the consolidated statement of comprehensive income.
Group Group
2024 2023
£ £
Short-term and low-value lease expense 198,735 49,606
Depreciation charge 204,374 203,870
Interest expense 62,378 103,008
Amounts recognised in the consolidated statement of cash flows.
Group Group
2024 2023
£ £
Short-term and low-value lease expense - -
Payment of lease liabilities 326,514 301,219
Capital commitments
At the end of the year there were no capital expenditure commitments £nil
(2023: £nil).
Note 21 SHARE CAPITAL
31 Dec 2024 31 Dec 2023
£ £
Allotted, issued and fully paid share capital:
Ordinary shares (86,169,236 of 1p each) 861,692 861,692
At 31 December 2024 the Company held 381,522 ordinary shares (2023: 531,522)
with an aggregate nominal value of £3,815 (2023: £5,315) in Treasury.
Treasury shares
Balance as at 1 January 2024 531,522
Shares sold (150,000)
Balance as at 31 December 2024 381,522
Treasury share movement in year due to exercise of share options of £150,000
which were taken out of treasury shares and moved to ordinary shares.
Note 22 PENSION SCHEME
The Company operates a Group Personal Pension Scheme, which all permanent
employees may join. The Scheme, which is a defined contribution scheme, is
independent of the Company's finances. The Company's contributions are based
on between 5.5% and 10% of members' gross salaries, dependent upon the length
of service of the individual. The Company has also chosen Royal London as its
workplace pension scheme to meet its employer duties under the Auto Enrolment
rules. Contributions to the Royal London scheme are at the minimum rates. The
total charge to administrative expenses in the statement of comprehensive
income is disclosed in Note 10 Staff Costs. Pension contributions payable to
the Schemes at the end of the year were £80,020 (2023: £63,681).
Note 23 FINANCIAL RISK MANAGEMENT
The Group is exposed to various risks in relation to financial instruments.
The Group's financial assets and liabilities by category are summarised in
Note 18. The main types of risks are market risk, credit risk and liquidity
risk. The Group's policy in respect of financial risk management is referred
to in the report on Corporate Governance.
The Group does not actively engage in the trading or holding of financial
assets for speculative purposes. The most significant financial risks to which
the Group is exposed are described below.
Market risk analysis
The Group is exposed to market risk through its use of financial instruments
and specifically to currency risk which results from its operating
activities.
Foreign currency sensitivity
A number of transactions are conducted by companies in the Group in currencies
other than their functional currency which give rise to monetary assets and
liabilities denominated in other currencies. The Group's exposure to foreign
currency exchange risk is mitigated to a large extent by natural hedging, as
assets in currency are matched by liabilities in the same currency. The value
of monetary assets and liabilities of the Group and Company not held in
functional currencies at the statement of financial position date were as
follows:
Net foreign currency monetary assets/(liabilities)
2024 2023
US dollar US dollar
£ £
Group 3,050,393 (175,103)
2024 2023
US dollar US dollar
£ £
If sterling had strengthened by 5% against US dollar:
Impact on net Group result and equity for the year (145,257) 21,312
If sterling had weakened by 5% against US dollar:
Impact on net Group result and equity for the year 160,547 (23,555)
Exposures to foreign exchange rates vary during the year depending on the
volume of overseas transactions. Nonetheless, the analysis above is considered
to be representative of the exposure to currency risk.
Credit risk analysis
Credit risk is the risk that a counterparty fails to discharge an obligation
to the Group. The Group is exposed to this risk via from cash and cash
equivalents and outstanding receivables.
The group applies the IFRS 9 simplified approach to measuring expected credit
losses which uses a lifetime expected loss allowance for all trade
receivables.
To measure the expected credit losses, trade receivables and contract assets
have been grouped based on shared credit risk characteristics and the days
past due.
On that basis, the loss allowance as at 31 December 2024 and 31 December 2023
was determined as follows:
Group
31 December 2024 Current More than 30 days past due More than 60 days past due More than 90 days past due Total
Expected loss rate - - - 0.01%
Gross carrying amount 4,525,345 552,964 741,415 377,088 6,196,812
Lifetime expected credit loss - - - 210 210
31 December 2023 Current More than 30 days past due More than 60 days past due More than 90 days past due Total
Expected loss rate - - - 0.01%
Gross carrying amount 5,282,708 18,712 128,551 210 5,430,181
Lifetime expected credit loss - - - 210 210
The Group loss allowances for trade receivables as at 31 December reconcile
to the opening loss allowances as follows:
2024 2023
£ £
Opening loss allowance at 1 January 210 210
Loss allowance recognised during the year - -
Closing loss allowance at 31 December 210 210
The credit risk for cash and cash equivalents and fixed-term cash deposits is
considered negligible since the counterparties are reputable banks with
high-quality external credit ratings.
Liquidity risk analysis
2024 Current More than 30 days past due More than 60 days past due More than 90 days past due Total
Trade payables 3,083,629 799,658 863,568 305,493 5,052,348
Accruals 2,595,334 2,595,334
2023 Current More than 30 days past due More than 60 days past due More than 90 days past due Total
Trade payables 4,747,497 673,864 154,861 131,452 5,707,674
Accruals 2,070,693 2,070,693
Liquidity risk is that the Group might be unable to meet its obligations. The
Group manages its liquidity needs by monitoring forecast cash inflows and
outflows due in day-to-day business. Liquidity needs are monitored in various
time bands, on a week-to-week basis and by monthly forecasting.
The Group's objective is to maintain cash to meet its liquidity requirements
for the foreseeable future. This objective was met for the reporting periods.
Funding for long-term liquidity needs is assessed by the Board on a regular
basis.
The Group considers expected cash flows from financial assets in assessing and
managing liquidity risk, in particular its cash resources and trade
receivables. The Group's existing cash resources and trade receivables (see
Note 16) exceed the current cash outflow requirements. Cash flows from trade
and other receivables are all contractually due within three months.
Note 24 CAPITAL MANAGEMENT
Capital for the reporting periods under review is summarised as follows:
The Group's objectives when managing capital are:
i. to ensure the Group's ability to continue as a going concern
ii. to provide an adequate return to shareholders
iii. to ensure the optimal cost of capital to fund the Group's strategy
by pricing products and services commensurately with the level of risk.
The Group monitors capital on the basis of the carrying amount of equity less
cash and cash equivalents as presented on the face of the Consolidated
Statement of financial position.
The Group manages the capital structure and makes adjustments to it in the
light of changes in economic conditions and the risk characteristics of the
underlying assets. In order to maintain or adjust the capital structure, the
Group may adjust the amount of dividends paid to shareholders, return capital
to shareholders, purchase its own shares to hold in treasury, issue new shares
or sell assets. There were no changes in the Group's approach to capital
management during the year. Neither the Company nor any of its subsidiaries
are subject to externally imposed capital requirements.
Group Group
2024 2023
£ £
Total equity 38,925,008 35,036,427
Cash and cash equivalents (13,706,703) (11,118,728)
Capital 25,218,304 23,917,699
Total Equity & overall financing 38,925,008 35,036,427
Capital to overall financing ratio 0.65 0.68
Note 25 RELATED PARTY TRANSACTIONS
Dividends paid to Directors during the year amounted
to:
- 280
Transactions with Key Management Personnel during the period:
Key Management Personnel are the Company's Board. Key Management Personnel
remuneration includes the following expenses:
Group Group
2024 2023
£ £
Short-term employee benefits 1,260,912 1,305,205
Post-employment benefits 16,299 18,632
Share-based payment (IFRS 2) 400,553 287,773
1,677,764 1,611,610
Note 26 SHARE-BASED PAYMENT
At the beginning of 2021 the Company operated an Enterprise Management
Incentive Share Option Scheme. During 2021, a Long Term Incentive Plan (LTIP)
was introduced.
The new Scheme provides for a grant price equal to the nominal value of the
Company's shares on the date of grant. Options cannot be vested until three
years after grant date and vesting is conditional upon the Group achieving a
compound percentage growth of the Group average basic earnings per Ordinary
Share, for the complete years commencing 1 January of the year of grant and
ending with the year most immediately prior to the vesting of the option. The
latest date for exercising options is 10 years after grant date and vesting of
options is subject to continued employment with the Group.
2024 2024 2023 2023
Options Weighted Options Weighted
average average
price price
N(o) pence N(o) pence
Outstanding at 1 January 4,544,202 16.15 2,289,797 31.14
Granted 832,816 1.00 2,300,209 1.00
Exercised (150,000) 39.00 - -
Forfeited/lapsed (130,625) 1.00 (35,804) 1.00
Outstanding at 31 December 5,096,393 10.86 4,554,202 16.15
Weighted average share price at date of exercise 166.80 - - -
Exercisable at 31 December 2024 Nil - Nil -
Options outstanding at 31 December 2024 had exercise prices ranging from 1.0
pence to 101.50 pence and a weighted average remaining contractual life of
2.14 years (2023: 2.49 years).
The inputs to the Black-Scholes model for options granted over the period were
as follows:
Grant Date 25 Sep 2024
Share price at grant date £1.16
Exercise price £0.01
Dividend yield 2.37%
Risk-free interest rate 3.75%
Volatility 39.20%
Note 27 ULTIMATE CONTROLLING PARTY
The Directors have assessed that there is no ultimate controlling party.
Note 28 BUSINESS COMBINATIONS
Acquisition in 2023.
Acquisition of Phillips Aerospace
During the prior year, on 6 September 2023, the Group acquired 100% of the
voting shares of Phillips Aerospace Limited, a non-listed company based in the
USA and specialising in the development and manufacture of industrial products
and associated services, in exchange for the Company's shares and cash. The
Group acquired Phillips Aerospace Limited because its strategy was to use the
Phillips business and diversify it into actual systems, offering it
additionally to the Group's customer base, as well as gaining Phillips'
customer relationships. These expansion, growth and export opportunities
provide an established presence in North America.
Assets acquired and liabilities assumed
The fair values of the identifiable assets and liabilities of Phillips
Aerospace Limited as at the date of acquisition were:
Assets: Fair value recognised on acquisition (£)
Tangible fixed assets 20,032
Working capital 140,560
Cash and cash equivalent 146,610
Borrowings (667,120)
Deferred tax (339,875)
Net (liabilities) on acquisition (699,793)
Separately identifiable intangible assets on acquisition 1,889,624
Goodwill on acquisition 815,602
Total fair value of capital invested 2,005,434
The deferred tax liability comprises the tax effect of the accelerated
depreciation for tax purposes of tangible and intangible assets.
Separately identifiable intangible assets comprise of customer relationships:
£1,436,181 License £487,163, technology know-how £195,625 and assembled
workforce £195,625.
The goodwill of £815,602 comprises the value of expected synergies arising
from the acquisition and a customer list, which is not separately
recognised.
From the date of acquisition, Phillips Aerospace Limited contributed £819,500
of revenue and £201,000 to profit before tax from continuing operations of
the Group.
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. END FR BXLLFEZLXBBZRecent news on Concurrent Technologies
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