REG - Journeo PLC - Final Results
28/03/2023 07:00
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RNS Number : 3774U Journeo PLC 28 March 2023
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the UK version of the EU
Market Abuse Regulation (2014/596) which is part of UK law by virtue of the
European Union (Withdrawal) Act 2018, as amended and supplemented from time to
time.
28 March 2023
Journeo plc
("Journeo, "Company" or "the Group")
Final results for the year ended 31 December 2022 and Investor Presentation
Journeo plc (AIM: JNEO), the information systems and transport technical
services group, is pleased to announce its final results for the year ended 31
December 2022.
Financial headlines
· Revenue increased 35% to £21.1m (2021: £15.6m)
· Gross profit increased 29% to £7.8m (2021: £6.0m)
· Underlying profit before tax doubled to £1.2m (2021: £0.6m)
· Profit before tax £0.9m (2021: £0.4m)
· Profit before tax excluding share-based payments was £1.0m (2021:
£0.5m)
· Cash and cash equivalents at 31 December 2022 £0.5m (2021: £1.1m)
· Diluted earnings per share was 9.80 pence (2021: 4.46 pence)
Operational headlines
· Strong growth in SaaS subscriptions to the Journeo Portal,
increasing connections by 150% over the period to 10,000 connected vehicles
(2021: 4,000).
· Continued investment in Research and Development as a core component
of the Company strategy.
· Extensive work with our supply chain to ensure availability of key
components.
· Large-scale adoption of Journeo technologies including the Group's
largest ever three-year £9m framework agreement with First Bus UK and
largest software-led sale following a two-year £1.2m agreement with Scotrail.
· Expansion of our Airport capabilities following the £0.7m award at
Dublin Airport for passenger transfer solutions and £0.9m order for
high-precision airside telematics at Heathrow Airport.
· Further progress in our Environmental, Social and Governance (ESG)
reporting
· Retained all ISO 9001, 14001, 27001 and 45001 accreditations and
Cyber Security and ICO certification.
Post year end
· Acquisition of Infotec for £8.7m following oversubscribed placing
and retail offer
Russ Singleton, CEO of Journeo plc, said: "I am very pleased with our
performance in 2022 which saw sustained improvement in order intake, revenues
and profits. This performance was delivered in a continuing challenging market
environment coupled with pressure on our global supply chain. It is a
reflection of our unwavering focus to execute on our strategy, which is
proving effective. The recent acquisition of Infotec, complements our
existing business and strategy well, and the enlarged group strengthens our
position further with a healthy order book and growing sales pipeline based on
our intellectual property and expert knowledge."
Investor Presentation
The Company is pleased to announce that Russ Singleton, Chief Executive
Officer and Nick Lowe, Chief Financial Officer, will provide a live
presentation relating to the Final Results via the Investor Meet Company
platform on 5 April 2023 at 12:00pm BST.
The presentation is open to all existing and potential shareholders. Questions
can be submitted pre-event via your Investor Meet Company dashboard up until
9am the day before the meeting or at any time during the live presentation.
Investors can sign up to Investor Meet Company for free and add to
meet Journeo via:
https://www.investormeetcompany.com/journeo-plc/register-investor
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Investors who already follow Journeo on the Investor Meet Company platform
will automatically be invited.
A digital copy of this announcement will be available on the Group's website:
www.journeo.com (http://www.journeo.com) .
For further information, please contact:
Journeo plc +44 (0) 203 651 9166
Russ Singleton/ Nick Lowe
Cenkos Securities - Nominated Adviser and Broker +44 (0) 207 397 8900
Katy Birkin/ Callum Davidson
Notes to editors:
Journeo plc is a leading Intelligent Transport Systems provider, delivering
solutions in towns, cities, airports and the public transport networks that
connect them. The Company works extensively with local and combined
authorities, Network Rail and many of the largest multinational transport
operators, supporting them as systems converge towards a more efficient and
sustainable future.
The business currently has three operating companies:
· Journeo Fleet Systems Ltd: CCTV video surveillance to improve
passenger & driver safety, telematics for vehicle and driver performance
monitoring, real-time communications for remote condition monitoring and
automatic passenger counting.
· Journeo Passenger Systems Ltd: design, manufacture, installation, and
management of hardware and software for electronic public transport
information systems, in and around towns, cities, ferry terminals and airports
which includes smart-ticketing and wayfinding.
· Infotec Ltd: design, advanced manufacture, installation and software
management of information displays hardware for rail applications in stations,
on-platform and on-vehicle.
In the last 4 years, the Company has invested over £5 million in research and
development, enabling it to design and supply powerful innovative solutions
for customers' complex requirements and the demands of modern public
transport. With an Internet of Things ("IoT") approach and open standards,
together with field-proven and reliable engineering, Journeo is able to offer
flexible, scalable products and services that can integrate with existing
technology while preparing for future advancements.
Chairman's Statement
I am pleased to report that the Company continues to make excellent progress
both in terms of financial performance and the development of its solutions.
Completing the acquisition of Infotec Group Ltd in January 2023 also marked a
significant move forward for the Group.
Infotec is a business that we have tracked with interest for several years,
and we are delighted to welcome their customers alongside the management and
wider teams of Infotec as they join the Journeo Group of companies. Infotec's
expertise in the rail market will support the Company as we execute our
strategy to further diversify our customer base and increase the potential
markets that we can reach with Journeo's core technologies.
The transport market's recovery from the pandemic is ongoing. The UK
Government's drive to improve public transport services through a range of
funding streams continues and is a core tenet of their strategy to lead the UK
to a Net Carbon Zero future, where mass transport and active travel options
are the de facto choice for journeys over personal-use and privately owned
vehicles. The continued development of our solutions supports this goal,
providing operators with powerful new tools to help manage their fleets, local
authorities the means to supply the travelling public with essential
information and now, with the addition of Infotec, railway operating companies
the ability to distribute on-platform information.
Trading results
Group results for the year ended 31 December 2022 show underlying profit
increased 83% to £1,158k (2021: £634k).
Overall sales increased by 35% to £21.1m (2021: £15.6m) and gross profit
increased by 30% to £7.8m (2021: £6.0m).
Fleet sales increased by 34% to £12.5m (2021: £9.3m) as bus operators
increased investment. Gross profit increased to £3.7m (2021: £2.9m) with
margins decreasing to 30% (2021: 31%) as hardware with a future software
benefit was installed.
Passenger sales increased by 37% to £8.6m (2021: £6.3m). Margins decreased
to 47% (2021: 49%) due to a higher proportion of new system installations, and
gross profit increased to £4.1m (2021: £3.1m).
Underlying administrative expenses increased to £6.7m (2021: £5.6m) as
expenditure returned to pre-COVID-19 levels, further investment was made, and
inflationary cost increases were felt.
Profit before tax was £0.9m (2021: £0.4m).
Diluted earnings per share (EPS) was 9.80p (2021: 4.46p).
Cash and cash equivalents closed the year at £0.5m (2021: £1.1m).
Markets
To achieve the 2050 Carbon Net Zero goal of the UK Government, mass adoption
of public transport and active travel is needed. To reduce the pollution
caused by personal-use vehicles, a migration to new technologies is required;
to ease congestion, only encouraging people out of their cars and on to buses,
trains and trams or to select options such as walking and cycling, will
achieve this.
Conditions in the transport market remain challenging. Changes in people's
work patterns to include a greater level of working from home and 'hybrid'
working have reduced the vitally important commuter spend that operators rely
on to achieve economic viability. This, coupled with the safety concerns
surrounding personal space, made the COVID-19 pandemic almost the perfect
storm for public transport.
However, there are signs of recovery. Bus travel, the most popular form of
public transport, may still remain some 27% behind pre-COVID levels of usage,
but Department for Transport (DfT) statistics for 2021/2022 show a 55%
increase in bus passenger journeys across the year, indicating that public
confidence in mass transit is returning.
Public concern over the cost-of-living crisis is also playing a part. With
energy and fuel costs soaring, selecting the more cost-efficient and
environmentally friendly option of taking the bus or catching a train should
be seen as a win-win situation for all parties. The UK Government's
introduction of the £2 fare cap (January to March 2023) supports this and is
an initiative that Journeo is fully behind.
Operators' investments in new vehicles, which has maintained historic lows in
recent years, is also starting to revitalise as bus operators seek to replace
ageing fleets with electric and hydrogen fuel cell buses, supported by the
Zero Emission Bus Regional Areas (ZEBRA) funding scheme from the UK
Government. Whilst we are yet to see a return to the previous norm of 5-7% of
vehicle fleets renewal per year, the signs are encouraging.
One of the biggest challenges for operators throughout the year was the
shortage of qualified bus drivers. During the COVID-19 pandemic, many drivers
were enticed away from the industry and elected to move to work in adjacent
markets and achieved substantively higher levels of pay, such as haulage. As
the recovery began, operators were left in the stark position where services
needed to be cut, as they simply could not put the vehicles on the road.
Our Content Management Software (CMS) known as EPIX, has for many years been
able to alert passengers to cancellations, curtailments and delays but is
reliant on upstream systems having the capability to produce the data. A
combination of opening our system usually reserved for local authorities, to
operators and improvements in systems earlier in the data chain, is improving
the level of information to passengers, but further work remains to give
passengers the confidence that they can rely on public transport.
Local authorities and Transport Executives are working continuously to promote
public transport and substantive backing from the UK Government, first through
the Transforming Cities Fund and more recently through the Bus Service
Improvement Plans (BSIPs) submitted in late 2021, is beginning to be realised.
BSIP awards totalling £1.2bn for local authorities and £5.7bn City Regional
Sustainable Transport Scheme (CRSTS) funding allocations were made over the
course of the year and parties are beginning to mobilise to deliver the
projects required to improve public transport.
As Control Period 6 (CP6) ends and Control Period 7 (CP7) appears on the
horizon of April 2024, there is still a lack of clarity about what changes we
will see in the rail market. The future evolution of Network Rail to Great
British Railways looks set to take place and be based locally to our Ashby
headquarters, in nearby Derby, and we wait to see what improvements will be
delivered through the Williams-Shapps Review for Rail. One thing that remains
certain, however, is that inter-city travel will need to become less costly
and more efficient to encourage people away from their cars, while providing
passengers with the information they need to plan and adapt their journeys is
crucial.
Strategy
Our strategy is proving effective and the recent acquisition of Infotec, which
has historically taken a very similar approach to ours in the rail market,
complements this well. We continue to have discussions with potential
complementary acquisitions and expect that we will be able to complete
additional suitable transactions in future.
The deep and long-lasting bonds that we build with our customers continue to
enable Journeo to identify current and future anticipated requirements within
our target markets. Focused Research and Development in areas where we
identify tasks that can be done more cost-effectively, more efficiently or to
a higher quality allows us to build Intellectual Property (IP) and deploy core
Journeo technology to add value to our customers and give them the tools they
need to overcome their challenges.
The Journeo Portal has proved central to this as it is a highly secure
web-based SaaS application that empowers transport operators to monitor the
health and performance of their systems in real time. Throughout 2022 we
achieved our target of surpassing 10,000 vehicle connections, each generating
monthly recurring revenue, marking a 150% increase on the connections the
application had at the close of 2021. Having reached this milestone, we will,
alongside continuing connection growth, be focusing our attention on extending
the capabilities of the back-end infrastructure required to include systems
deployed through our Passenger Transport Infrastructure Systems business
within the application. There are a number of pre-qualified opportunities on
the horizon that support the need for a single application to manage transport
networks. Managing all customers through a single solution will additionally
enable the Company to enhance and streamline services further.
COVID-19
The Group is still feeling the impact of COVID-19, most notably on our supply
chain, and we continue to closely monitor the situation.
Recent developments in China, the conflict in the Ukraine and the evolution of
a new variant strain of COVID-19 are areas where we are focusing our
attention, but we remain confident that having navigated the challenges of the
past few years, we have the infrastructure and process in place to mitigate
identified risks.
Environmental, social and governance
The Group continues to leverage the expertise of external consultants to
support our work on developing a clear set of strategies and targets for our
environmental, social and governance activities.
Throughout 2022, the Company maintained all ISO and cyber security
accreditations.
People
It brings me great pleasure to be able to both thank the continuing dedication
of our existing people and welcome new team members into the Journeo Group.
The continuing commitment of our people is playing an important role in
building the capabilities of the Group, which in turn is strengthening our
position as an emerging market leader and supporting our customers in moving
to connected systems based upon open standards.
I am eager to see this continue as the Company moves into a new and exciting
era that will include a wider range of customers and the potential for an
increasing amount of valuable solutions.
I would also like to take this opportunity to welcome Barnaby Kent as
Non-executive Director to the Board at an exciting time in Journeo's
development and look forward to the important input he will be able to make as
we progress our growth strategy.
Outlook
2022 can be seen as a defining point in the development of Journeo. Over the
course of the year our Fleet Systems business has grown strongly and increased
adoption of our SaaS-based solutions to more than double the amount that we
had at the close of 2021. This is providing the Group with quality earnings
and recurring revenue.
Furthermore, we have seen our Passenger Infrastructure business grow,
capitalising on Government investment through TCF and BSIPs, resulting in
increased revenue throughout 2022 and a commitment to bolster our current EPIX
CMS software through integration into the Journeo Portal.
Independently of the acquisition of Infotec, our Fleet Systems and Passenger
Infrastructure businesses have order books of unprecedented strength and an
increasing pipeline of opportunities. Adding the capabilities, revenue and
pipeline of Infotec into this underpins our confidence that Journeo is moving
into a period of exciting change and growth in the next few years.
Challenges, of course, remain. Pressure on global supply chains is likely to
persist well into 2023 and beyond; the possibility of escalating conflict in
Ukraine and escalating tensions between China and Taiwan have the potential to
destabilise all businesses and Government focus on some Far East supply
partners are continuing areas of attention for the Board. We remain vigilant
in these areas and have confidence that we have teams who retain agility and
dedication to respond to any emerging risk, creating mitigating strategies
where appropriate.
Following the acquisition of Infotec, we continue to evaluate complementary
and bolt-on acquisitions that can both support the Group in executing its
strategy and deliver enhanced value to our shareholders.
The Board remains focused on delivering our growth plans throughout the course
of 2023 and beyond, ensuring that we continue the current trajectory of the
Group and deliver evermore of our advanced solutions to customers in the UK
and internationally.
Mark Elliott
Non-Executive Chairman
28 March 2023
Chief Executive's Statement
Introduction and strategy update
The Company is making significant progress within the UK public transport
market in its journey to be recognised as a leading provider of intelligent
transport systems.
Against a backdrop of a slowly recovering transport market, Journeo has
achieved dramatic growth in the number of connections to our cloud-based SaaS
solution, the Journeo Portal; grown the deployment of our safety-critical
digital wing mirror replacement system; continued to support local authorities
and transport executives in making public transport more accessible; and, at
the end of the period, made strategically important inroads into the rail
market. This organic growth, which will further be supported by the
acquisition of Infotec completed just outside of the year in January 2023,
demonstrates the ongoing positive trajectory of Journeo.
The acquisition is an important landmark for the Company, providing us with a
wider and more diverse customer base, both in the UK and overseas, in which to
embed core Journeo technology. Any business that joins the Journeo family of
companies are selected for their existing alignment to the main principles of
our strategy. Infotec demonstrates technology leadership and domain expertise
in its target markets, achieved through close customer bonding and engineering
excellence.
Both domestically and internationally there is continued momentum to achieve a
Carbon Net Zero future, and initiatives for mass public transportation and
active travel are key to achieving this. The solutions that Journeo provide,
from the promotion and awareness of public transport options, through to the
safety and comfort of passengers on-board vehicles, support this goal, making
them just one of the many elements required to help people choose greener,
more sustainable forms of movement over the personal-use car.
We continue to concentrate our Research and Development with over £5m
invested in the last four years to ensure that, our technologies and solutions
support customers in prolonging the operational life of legacy equipment,
deliver insightful and usable information from the systems purchased today and
future-proof them for the developments of tomorrow, leveraging available open
standards.
Operational review
Passenger Transport Infrastructure Systems
I am pleased to report that Passenger Systems performed in line with our
expectations and delivered revenue growth of 37% across the year with revenues
increasing to £8.6m (2021: £6.3m).
In March 2022, we announced a £2.1m purchase order for displays technology
from City of Edinburgh Council. Whilst this formed part of spending indicated
in a previously announced framework agreement (December 2019), the achievement
of securing this order was by no means a foregone conclusion. Enhanced
requirements from the original award required intensive work from our
development teams to design new displays technology that is able to operate at
lower power consumption rates and still offer the same level of functionality.
I am delighted that through the ingenuity and dedication of our development
teams, we were able to rise to meet this challenge, and Scotland's capital
city will soon be in receipt of new optically bonded TFT displays that deliver
higher contrast, lower reflection levels and increased readability, even in
full sunlight, at a lower power consumption.
One important industry development over the course of 2022 has been the
introduction of a new Content Management System to Passenger Information
Display (CMS to PID) interface standard that defines the communication
protocols between back-end software systems and displays. Whilst
system-to-system communication has been defined for many years by
industry-wide adoption of CEN (European Committee for Standardisation)
standard interfaces, the final link in the data chain between a CMS and a
display has not had the same attention and most usually relied upon
proprietary standards.
The Real Time Information Group (RTIG) embarked on a project to change this.
Funded by Transport for Wales (TfW), RTIG sought to introduce a standard
protocol that could be used for TFT, LED and low-power displays. Journeo has
played an active role in creating this standard and has participated in the
Working Groups to define it, providing our deep industry knowledge to its
creation. Some parts of the standard remain in draft form, but it continues to
progress well.
This new standard has been welcomed by local authority customers, who so often
have been locked to existing suppliers when selecting technology for
deployment within their information estate. As such, adoption or future
adoption of this protocol is beginning to become a standard requirement in
tender specifications and in June 2022 we announced a contracts award
totalling £1.7m with Nottingham City Council for solutions that will rely
upon this development.
The larger of the contracts, valued at £1.4m, will see Journeo upgrade 1,600
legacy displays away from radio-based solutions to operate on 4G and 5G
technology, communicating exclusively on the new protocol. The balance of
£0.3m is for the delivery of a new intelligent messaging platform that will
enable the authority to automate messaging from multiple sources, both human
and machine-based, for delivery to displays. The second award, whilst smaller
in value, has significant strategic benefits for Journeo as we look to
integrate the EPIX CMS into the Journeo Portal platform.
The success of the business continued across the year, with multiple awards
for a Northern Transport Partnership and purchase orders for displays
technology of £0.6m in July 2022, £0.7m in early December 2022 and a further
£0.5m just before the year end.
The partnership's continued investment in Journeo technology is a fundamental
part of their plan to improve the level of information provided to travellers
at bus stations, interchanges, travel hubs and along key transit corridors.
The development of our Passenger Transport Infrastructure Systems business is
quite impressive since its formation following the acquisition of Region
Services in 2015. At the outset, it was clear that there were significant
barriers to entry that prevented us from accessing new customers. Contractual
and technological lock-ins were also preventing the business from reaching its
potential and we have worked hard to overcome or remove many of the obstacles.
In addition to the new RTIG CMS to PID standard, we have created new
procurement routes for our customers. We have been listed on the Crown
Commercial Service's Transport Technology and Associated Services (TTAS)
framework since late 2021 and were accepted on to the Smart Applications
Management (SAM) displays framework in June 2022. Whilst no monetary value is
yet attached to this framework, it is expected to play a central role in the
redevelopment of real-time information estate in Wales and across the United
Kingdom. I am encouraged that as we apply more of our development resource to
the business across the course of 2023, we have the procurement routes and
technical agility to further develop the business.
Fleet Transport Operator Systems
Our Fleet Transport Operator Systems business has performed well over the
course of 2022 with revenues increasing 34% to £12.5m (2021: £9.3m); in part
due to the increase in investment of bus operators. However, the impact our
core technology and exclusive supply agreements from our partners have had in
securing orders and framework agreements cannot be underestimated.
A key aspect of our success, during the extended period of suppressed vehicle
orders has been the implementation of the Journeo Camera Monitoring System,
also known as our digital wing mirror system. A safety-critical solution that
formed part of the Transport for London (TfL) Vision Zero specification, the
solution replaces traditional wing mirrors with high-definition analogue
cameras and internal monitors that improve visibility of the surrounding road
conditions for the driver.
Since introduction in 2018 we have supplied and installed these solutions on
over 1,000 buses and in March 2022 secured an agreement for a three-year
extension to our exclusive supply agreement which includes the UK bus market
and Scandinavia, where trials of the system were deployed across the course of
the year. This market-leading solution continues to gain interest and in the
year we achieved our first retrofit system trials, which may significantly
extend the number of vehicles that can now access this safety-critical system.
We continue to develop the solution with the OEMs and demonstrated prototype
technology at the Euro Bus 2022 exhibition at the NEC in November 2022.
In April 2022 we were delighted to announce a three-year, £9m framework with
First Bus UK. The framework also has the potential for a further two-year
extension, which would take the agreement through to March 2027. Based upon
our core technology and SaaS Journeo Portal product, the framework is the
largest ever achieved by Journeo and enables us to provide tracking, video
management and remote condition monitoring services of on-vehicle systems
across the entirety of the operator's 4,500-strong fleet of vehicles.
This widescale adoption of Journeo technology is a demonstration of the close
bond that we hold with our customers, which enables us to better understand
their needs and adapt our technology to deliver solutions that improve
operational efficiency at lower cost. Between its launch in October 2019 and
the close of the year in December 2022, the Journeo Portal has grown
exponentially and now has over 10,000 vehicle connections, with more expected
over the course of 2023. Our Fleet Transport Operator Systems business has
undoubtedly been a benefactor of our technology advancements and a
ratification of the need for our continued investment in Research and
Development.
In September 2022 our Airport Passenger Transfer solutions experienced further
success with the £0.7m award for systems to be deployed for Aircoach at
Dublin Airport, marking the first deployment of our solutions outside of the
UK. The powerful operation management software supports the operator in
running an efficient and timely service transporting passengers to the
terminal buildings and will join London Gatwick, London Stansted, London
Heathrow and Bristol airports in running on Journeo technology.
Whilst we have historically focused on solutions for bus, we have maintained a
small and dynamic team to address the rail market and their work this year has
been rewarded with two major awards. The first, in January 2022 was for a
£0.7m award for the supply and support of high-definition Forward-Facing CCTV
(FFCCTV) systems to GBRf. The systems are also connected to our SaaS platform,
the Journeo Portal, demonstrating the adaptability of our core technology to
adjacent markets.
The second and more significant award was achieved at the end of the year, in
December 2022, where Network Rail awarded Journeo with a £1.2m contract to
connect third-party systems to our Journeo Portal, on behalf of ScotRail. The
two-year licensing agreement is the first major software-led contract that the
Company has secured and demonstrates the confidence in the cyber-security
employed to enable image-sharing between Network Rail, a Train Operating
Company (TOC) and the British Transport Police (BTP). Additionally, the award
also includes our new Track Incursion Monitoring (TIM) application, that will
enable the parties to be alerted to foliage creep and track obstruction using
the existing legacy cameras.
The developments in our rail applications are cause for optimism and,
following the acquisition of Infotec in January 2023, we expect to see a
growing ability within the Company to cross-sell solutions across the rail
industry.
Central Services
Following the end of Work from Home instructions in January 2022, the Company
adopted a primarily hybrid working model. Whilst our Sales Teams have always
worked remotely, this signalled a shift in approach to the central services of
Development, Finance, Marketing and Project Management. This decision has been
welcomed by our team members, enabling both the interaction with colleagues
needed to create the spark for innovation alongside the quiet focus time
required to deliver it. The only areas that do not adopt this model are areas
of the business where we feel office or site attendance is essential; such as
in production and customer support.
We continue to work closely with our supply chain partners and monitor the
impacts of global events on our ability to source the essential components
such as semiconductors, microprocessors and display panels.
Whilst our work on ESG is ongoing, and we are focusing on developing the
framework to achieve Level 1 and Level 2 carbon emissions reporting, we are
aware that there will be a need to develop Level 3 reporting in the future and
are making necessary adjustments to monitor such a change.
In situations where specific risks are identified that may affect pricing,
availability or quality of component supplies we take corrective action to
try to mitigate the effects through advance purchasing of core components and
source alternatives that can be substituted if required.
Throughout 2022, we maintained all ISO and Cyber accreditations which not only
provides us with information security, governance and traceable quality
systems, it demonstrates to our passenger infrastructure and fleet operator
customers that Journeo are the right people in which to place their trust, and
deliver the vital products, software and support services.
Russ Singleton
Chief Executive
28 March 2023
Consolidated statement of comprehensive income for the year ended 31 December
2022
Notes 2022 2021
£'000 £'000
Revenue 2, 3 21,123 15,592
Cost of sales
(13,354) (9,569)
Gross profit 3 7,769 6,023
Underlying administrative expenses (6,730) (5,557)
Other income 119 168
Underlying profit 1,158 634
Share-based payments (45) (49)
Total administrative expenses and other income (6,656) (5,438)
Operating profit 1,113 585
Finance expense (207) (176)
Profit before taxation 906 409
Taxation charge
5 (3) (2)
Profit for the year being total comprehensive income attributable to owners of
the parent
903 407
Profit per share 6
Basic 10.33p 4.65p
Diluted 9.80p 4.46p
Consolidated statement of changes in equity for the year ended 31 December
2022
Share Share Retained Total equity
capital premium earnings shareholders'
£'000 account £'000 funds
£'000 £'000
Balance at 1 January 2021 6,250 1,174 (6,680) 744
Profit and total comprehensive income for the year
- - 407 407
Share-based payments - - 49 49
Balance at 31 December 2021 6,250 1,174 (6,224) 1,200
Profit and total comprehensive income for the year
- - 903 903
Share-based payments - - 45 45
Balance at 31 December 2022 6,250 1,174 (5,276) 2,148
Consolidated statement of financial position at 31 December 2022
2022 2021
£'000 £'000
As restated
Assets
Non-current assets
Goodwill 1,345 1,345
Other intangible assets 1,300 1,166
Property, plant and equipment 504 565
Trade and other receivables 41 43
3,190 3,119
Current assets
Inventories 3,455 1,609
Trade and other receivables 8,130 5,047
Cash and cash equivalents 533 1,096
12,118 7,752
Total assets 15,308 10,871
Equity and Liabilities
Shareholders' equity
Share capital 6,250 6,250
Share premium account 1,174 1,174
Retained earnings (5,276) (6,224)
Total equity 2,148 1,200
Non-current liabilities
Deferred revenue 2,304 947
Loans and borrowings 40 604
Lease liabilities 225 261
Provisions 271 313
2,840 2,125
Current liabilities
Trade and other payables 5,796 3,499
Deferred revenue 1.552 2,524
Loans and borrowings 2,616 1,175
Lease liabilities 121 121
Provisions 235 227
10,320 7,546
Total equity and liabilities 15,308 10,871
Consolidated statement of cash flows for the year ended 31 December 2022
Notes 2022 2021
£'000 £'000
Net cash flows from operating activities 6 (587) 2
Cash flows from investing activities
Purchases of property, plant and equipment (58) (165)
Purchases / generation of intangible assets (628) (460)
Net cash flows from investing activities (686) (625)
Cash flows from financing activities
Cash flows from financing activities 891 642
Principal element of lease repayments (170) (148)
Repayment of loans (15) (22)
Net cash flows from financing activities 706 472
Net decrease in cash and cash equivalents (567) (151)
Cash and cash equivalents at beginning of year 1,096 1,254
Effect of foreign exchange rate changes 4 (7)
Cash and cash equivalents at end of year 533 1,096
Notes to the consolidated financial statements for the year ended 31 December
2022
1. Basis of preparation
The Group financial statements are prepared in accordance with International
Financial Reporting Standards and IFRIC interpretations issued and effective
(or adopted early) and endorsed by the United Kingdom at the time of preparing
these financial statements and with those parts of the Companies Act 2006
applicable to companies reporting under IFRS. The financial statements have
been prepared under the historical cost convention, except financial
instruments and share-based payments, which are prepared in accordance with
IFRS 9 and IFRS 2 respectively. A summary of the more important Group
accounting policies is set out below.
The individual financial statements of each Group entity are presented in the
currency of the primary economic environment in which the entity operates (its
functional currency). For the purpose of the consolidated financial
statements, the results and financial position of each Group entity are
expressed in Sterling (£), which is the presentation currency for the
consolidated financial statements. The numbers in the financial statements are
rounded in £'000 for presentation purposes.
Going concern
The Group's business activities, together with factors likely to affect its
future development, performance and position, are set out in the Strategic
Report along with the principal risks and uncertainties.
The Group's net underlying profit for the year was £903k (2021: £634k). As
at 31 December 2022 the Group had net current assets of £1,798k (2021:
£206k) and net cash reserves of £533k (2021: £1,096k).
On 16 January 2023, the 2016 Loan Notes and the 2018 Loan Notes were repaid.
The Directors have prepared Group cash flow projections for the period to 30
June 2024 based on latest forecasts that show that the Group will be able to
operate within the Group current funding resources with significant headroom.
As with all businesses there are particular times of the year where our
working capital requirements are at their peak. The Group is well placed to
manage these business risks effectively and the Board reviews the Group's
performance against budgets and forecasts on a regular basis to ensure action
is taken where needed. The Directors also monitor a rolling cash flow
forecast, and key management review working capital movements and requirements
on a daily basis.
The projections, taking account of reasonably possible changes in trading
performance, indicate that the Group will operate within available facilities
throughout the projection period and therefore, based on these projections,
the Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future and
for at least 12 months from the date of these financial statements. The
Directors, therefore continue to adopt the going concern basis in preparing
the financial statements.
2. Revenue and other income
The revenue split between good and services is:
2022 2021
£'000 £'000
Goods 15,621 10,615
Services 5,502 4,977
21,123 15,592
Contract works included in goods 7,599 5,520
3. Segmental reporting
IFRS 8 requires operating segments to be determined on the basis of those
segments whose operating results are regularly reviewed by the Board of
Directors (the Chief Operating Decision Maker as defined by IFRS 8) to make
strategic decisions.
As the Board of Directors reviews revenue, gross profit and operating loss on
the same basis as set out in the consolidated statement of comprehensive
income, no further reconciliation is considered to be necessary.
Revenue and gross profit
Revenue Gross profit Revenue Gross profit
2022 2022 2021 2021
£'000 £'000 £'000 £'000
Fleet Systems 12,494 3,711 9,290 2,919
Passenger Systems 8,629 4,058 6,302 3,104
Total 21,123 7,769 15,592 6,023
Major customers
In the year, one customer within the Fleet Systems segment accounted for over
16% of Group revenue and no customers within the Passenger Systems segment. In
the prior year, there was one Fleet Systems customer that accounted for over
10% of revenue at 10% and no major customers within the Fleet Systems segment.
Underlying profit
2022 2021
£'000 £'000
Fleet Systems 690 698
Passenger Systems 740 339
1,430 1,037
Central (272) (403)
Underlying profit 1,158 634
Reconciling to profit / (loss) before interest and tax
2022 Underlying Share-based Operating Profit/(loss)
operating payments profit / (loss) before interest
profit / (loss) £'000 £'000 and tax
£'000 £'000
Fleet Systems 690 (23) 667 667
Passenger Systems 740 (22) 718 718
1,430 (45) 1,385 1,385
Central (272) - (272) (272)
1,158 (45) 1,113 1,113
2021 Underlying Share-based Operating Profit / (loss)
operating payments profit / (loss) before interest
profit / (loss) £'000 £'000 and tax
£'000 £'000
Fleet Systems 698 (24) 674 674
Passenger Systems 339 (25) 314 314
1,037 (49) 988 988
Central (403) - (403) (403)
634 (49) 585 585
Net assets attributed to each business segment represent the net external
operating assets of that segment, excluding goodwill, bank balances and
borrowings, which are shown as unallocated amounts, together with central
assets and liabilities.
Net assets
Assets Liabilities Net assets Assets Liabilities Net assets
2022 2022 2022 2021 2021 2021
£'000 £'000 £'000 £'000 £'000 £'000
Fleet Systems 8,134 (3,627) 4,507 5,193 (3,216) 1,977
Passenger Systems 5,156 (6,744) (1,588) 4,109 (5,449) (1,340)
13,290 (10,371) 2,919 9,302 (8,665) 637
Goodwill 1,345 - 1,345 1,345 - 1,345
Cash and borrowings 533 (2,656) (2,123) 1,096 (1,779) (683)
Unallocated 139 (134) 5 12 (111) (99)
Total 15,307 (13,161) 2,146 11,755 (10,555) 1,200
Geographical segments
Revenue Gross profit Revenue Gross profit
2022 2022 2021 202
£'000 £'000 £'000 £'000
UK 20,538 7,316 15,070 5,602
International
- Scandinavia 458 457
- Other EU 38 43
- Non-EU 89 22
Total international 585 453 522 421
Total 21,123 7,769 15,592 6,023
Assets and liabilities by location
2022 2021
£'000 £'000
Assets
UK 14,662 11,720
International 12 35
Total assets 14,674 11,755
Liabilities
UK (12,508) (10,532)
International (19) (23)
Total liabilities (12,527) (10,555)
All non-current assets are located within the United Kingdom.
4. Taxation
(a) Analysis of charge in year:
2022 2021
£'000 £'000
Current tax
UK corporation tax on the profit for the year (19%) - -
Swedish corporation tax on the profit for the year (22%) 3 -
Prior year under provision - 2
Total tax charge for the year 3 2
(b) Factors affecting the total tax charge for the year
The tax assessed for the year differs from the standard rate of corporation
tax in the UK at 19% (2021: 19%). The differences are explained below:
2022 2021
£'000 £'000
Profit before tax 905 409
Profit multiplied by standard rate of 78
corporation tax in the UK of 19% (2021: 19%)
172
Effects of:
Expenses not deductible for tax purposes (150) (139)
Change in unrecognised deferred tax assets 4 93
Income not taxable (23) (32)
Prior year under provision - 2
Total tax charge for the year 3 2
(c) Deferred tax asset / (liability)
The unrecognised and recognised deferred tax assets / (liability) comprise the
following:
Group Unrecognised Recognised
2022 2021 2022 2021
£'000 £'000 £'000 £'000
Tax losses 724 1,116 - -
Accelerated capital allowances (94) (91) - -
630 1,025 - -
The Group has £3,813,000 of unutilised tax losses (2021: £4,466,000) which
may be carried forward indefinitely. On 3 March 2021, the Chancellor of the
Exchequer announced that the corporation tax rate would increase to a maximum
of 25% from 1 April 2023.
5. Profit per Ordinary Share
Basic earnings per share (EPS) is calculated by dividing the earnings
attributable to Ordinary Shareholders by the weighted average number of
Ordinary Shares in issue during the year.
For diluted earnings, the weighted average number of Ordinary Shares in issue
is adjusted to assume conversion of all dilutive potential Ordinary Shares.
Group 2022 2021
Profit Per share Profit Per share
£'000 amount £'000 amount
Pence Pence
Basic EPS
Profit attributable to Ordinary Shareholders 903 10.33p 407 4.65p
Diluted EPS
Profit attributable to Ordinary Shareholders 903 9.80p 407 4.46p
Details of the weighted average number of Ordinary Shares used as the
denominator in calculating the earnings per Ordinary Share are given below:
2022 2021
'000 '000
Basic weighted average number of shares 8,741 8,741
Dilutive potential Ordinary Shares 470 370
Diluted weighted average number of shares 9,211 9,111
6. Reconciliation of operating profit to net cash inflow from operating
activities
2022 2021
£'000 £'000
As restated
Profit for the year 903 407
Adjustments for:
- Finance expense 207 176
- Depreciation of property, plant and equipment 224 218
- Amortisation of intangible fixed assets 494 438
- Share-based payment expense 45 49
- Foreign exchange rate - (15)
- (Decrease) / increase in provisions (34) 79
Operating cash flows before movement in working capital 1,839 1,352
(Increase) / decrease in inventories (1,846) 66
Increase in receivables (1,564) (840)
Increase in payables 1,166 1,334
Cash (outflow) / inflow from operations (405) 144
Income taxes paid (3) (2)
Interest paid (179) (140)
Net cash (outflow) / inflow from operating activities (587) 2
7. Availability of audited accounts
Copies of the 2022 audited accounts will be made available following the
announcement of the date of our AGM. They will also be available on the
Group's website (www.journeo.com (http://www.journeo.com/) ) for the purposes
of AIM Rule 26 and will be posted to shareholders shortly.
ENDS
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