REG - Light Science Tech. - Trading Update

Light Science Technologies HoldingsAnnouncement

29/06/2023 07:00

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RNS Number : 3617E  Light Science Tech. Holdings PLC  29 June 2023

 

Light Science Technologies Holdings plc

("LSTH", the "Company" or the "Group")

 

Trading Update

 

Light Science Technologies Holdings plc (AIM: LST), the controlled environment
agriculture ("CEA") technology and contract electronics manufacturing ("CEM")
group, is pleased to provide a trading update for the six months to 31 May
2023 (the "Period").

 

Financial Highlights

Trading during the Period was in line with the Board's expectations, with
revenue for the Period expected to be c.£4.4m (H1 2022: £3.6m), up
approximately 22%. The Group's performance reflected the benefits of
operational improvements undertaken to improve gross margins, which grew to
c.20.9%, compared to 17.7% in FY 2022. Improving market conditions and reduced
supply chain constraints within the CEM division underpinned this increase
while the Group also successfully reduced overheads by approximately 20%, as
part of the previously announced cost base realignment.

 

Operational Highlights

The CEM division performed in line with expectations. During the Period its
position as the Group's predominant revenue generator continued, building on
the record sales achieved during FY 2022. Furthermore, as anticipated, gross
margin is returning to normalised levels.  This division is now the
manufacturing arm of sister company Light Science Technologies - with the
first production batch of sensorGROW successfully running through the UK
Circuits' facility during the Period.

 

Within the CEA division, the Group continued to develop its portfolio and
potential market reach. Particular focus was on positioning this division for
growth via product development and intellectual property protection - with the
aim of targeting global opportunities and addressing year round growing needs
at the same time as reducing the requirement for food imports.

 

Patent Applications

During the Period, the Group submitted International Patent Applications for
its sensorGROW sensor arrangement and advanceGROW modular light arrangements
in the US and EU - in addition to its UK applications.

 

The sensorGROW patent is for the Group's all-in-one wireless sensor which
provides complete growing environment data remotely and can be tailored to
clients' environments (image below left). By utilising big data to highlight
trends and provide insights, it enables users to increase profitability and
yields at the same time as reducing costs.

 

The advanceGROW modular light arrangement system (image below right) has been
developed as part of the Group's long term contract with Zenith Nurseries
Ltd, to develop a cloche lighting and sensor technology system. Initial field
trials increased crop growth by 40% in December 2022 - particularly useful
given the cold ground and the poor light in glasshouses at that time of year,
further highlighting commercial opportunities and the Group's ability to help
extend the growing season.

 

Outlook

As previously flagged, there is still material uncertainty over the level and
timing of revenue in the CEA division. Therefore, the Group's broader strategy
remains on creating partnerships globally within this division, enabling it to
develop a portfolio of clients to include markets that have been less impacted
by the energy crisis. The CEM division continues to benefit from its
relationship with long standing blue-chip customers, providing good levels of
visibility. With a view to building on opportunities within both divisions,
management is also evaluating acquisition opportunities that are cash flow
generative.

 

The Board currently anticipates meeting full year expectations as the Group
benefits from further cost savings during H2 FY2023 at the same time as
continuing to develop and convert opportunities. As of today's date, the sales
pipeline of quoted work is over £45m, of which there are forward orders and
contracts worth £18.8m*.

 

*  Subject, inter alia, to certain milestones and conditions as more fully
described in the Company's announcement on 15 October 2021 and mentioned in
the Company's AIM Admission Document, as updated in the Company's announcement
on 16 September 2022.

 

 

 

For additional information please contact:

 

 Light Science Technologies Holdings plc                    www.lightsciencetechnologiesholdings.com

                                                          (http://www.lightsciencetechnologiesholdings.com/)

 Simon Deacon, Chief Executive Officer                      via Walbrook PR

 Jim Snooks, Chief Financial Officer

 Andrew Hempsall, Chief Operating Officer

 Strand Hanson Limited (Nominated & Financial Adviser)      Tel: +44 (0) 20 7409 3494

 Ritchie Balmer / James Harris / Rob Patrick

 Oberon Capital (Broker)
 Mike Seabrook / Nick Lovering                              Tel: +44 (0) 203 179 5300

 Walbrook PR Ltd (Media & Investor Relations)               Tel: +44 (0)20 7933 8780 or lst@walbrookpr.com (mailto:lst@walbrookpr.com)

 Nick Rome / Paul McManus

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) No. 596/2014, as it forms part of UK domestic
law by virtue of the European Union (Withdrawal) Act 2018 (as amended).

 

About Light Science Technologies Holdings plc
(www.lightsciencetechnologiesholdings.com
(http://www.lightsciencetechnologiesholdings.com) )

Light Science Technologies Holdings plc is the holding company of the Group's
controlled environment agriculture ("CEA") division, Light Science
Technologies Ltd ("Light Science Technologies"), and its contract electronics
manufacturing ("CEM") division, UK Circuits and Electronics Solutions Limited
("UK Circuits").

 

Controlled Environment Agriculture

Light Science Technologies was founded in 2019 and is the Company's grow
lights and sensor technology business, providing bespoke recipes and
technologies tailored to customers' needs - with key targets including indoor,
vertical, glasshouses, polytunnels and medicinal farming markets. The
all-in-one CEA solution will include analysing customers' crop growing
requirements to provide bespoke, low-energy and sustainable equipment.

 

Market drivers include food and water shortages in many parts of the world;
growing global population; UK and other government policy encouraging
sustainable and efficient growth methods; increased scrutiny of the effect of
food production on climate change and the continuing transition away from
processed foods.

 

sensorGROW

sensorGROW was launched in June 2022 and its technology will enable farmers to
monitor the following key air zone growing factors in real-time: carbon
dioxide levels, humidity, light, oxygen - and in the future: air speed, plant
disease, soil, temperature and water pH levels. By monitoring these key
growing factors, farmers can save money through better management of
resources: water, nutrients, fertilisers and energy - while increasing yields
and producing healthier crops.

 

nurturGROW

nurturGROW is a sustainable grow lighting product range, offering an
innovative, high-performance and cost-effective solution for indoor farming,
covering greenhouses, vertical farming, polytunnels and medicinal plants.

 

Created with four core component parts, the nurturGROW range is made of high
quality, durable materials to give growers the ideal balance between strength
and optimal performance, minimising the amount of materials needed to
drastically cut down on waste and reduce carbon footprint.

 

Contract Electronics Manufacturing

UK Circuits is the Company's CEM focussed division, profit making with strong
revenues. The Group designs, procures, and manufactures high-quality CEM
products, specialising in Printed Circuit Boards, which are used in a range of
sectors including audio, automotive, electronics, gas detection, lighting,
pest control, telecommunications and, more recently, the CEA market.

 

 

 

 

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