Microsaic Systems - Operational Update
14/01/2025 07:00
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RNS Number : 1673T Microsaic Systems plc 14 January 2025
14 January 2025
Microsaic Systems plc
("Microsaic", "Microsaic Systems" or the "Company")
Operational Update
Microsaic Systems plc (AIM: MSYS), an international developer and provider of
testing solutions for unique and underserved public health and environmental
markets, is pleased to present an operational update.
The Company is focused on developing a strong business in the water and
environmental testing markets. Given the unique position of its small-scale
technologies the Company believes it can become a leading mobile and
point-of-use water testing technology provider. The Company's technologies are
versatile and can provide testing results in minutes rather than hours and can
be charaterised as a "lab in a box".
The Company is working on the following operational and product development
projects in the water and environmental testing markets, focused on generating
early revenues and improvements in gross margins.
Qatar project update
The Company is pleased to confirm that we have been advised that a phase two
tender for 17 further (in addition to the 27 already installed) Continuous
Toxic Monitoring systems (CTMs) is expected after full commissioning and
handover to Kahramaa, the client public water utility in Qatar. To comply with
this timeline and project funding release by Kahramaa the Company has agreed a
modified payment schedule with our installation partner Avanceon. A sum of
€87k has been received from Avanceon as part payment of the first tranche
invoice of €228k for phase one project installation. The remaining balance
is to be paid after consumable items for the existing CTMs are installed.
These items are in the process of being shipped to Doha for installation
shortly after arrival. After installation of these items the second tranche
payment of €228k for completion of phase one of the project will be due in
Q1 2025. The phase one contract value is €456k in two tranches of €228k.
An extra performance (warranty) amount of €114k is payable over three years
giving a total value of €570k. Consumables including Microtox® reagents are
supplied at additional cost.
MicroTox® LX
Production is ongoing at GX Group in Wales of our newly upgraded laboratory
based MicroTox® LX device. We have received an increase from the initial firm
orders of 8 units to 13 units. We also have preliminary order requests from
our distributors of around 25 further units in H1 2025. We are delighted that
substantial enquiries are coming in for this industry standard laboratory
device for early screening of toxins in water which utilise the MicroTox®
reagent consumables that we manufacture at our York laboratory.
We have also received a pre order payment for a MicroTox® LX from a new
customer in Kuwait which is a target country for expanding our sales in GCC
countries following on from success in Qatar.
PFAS Systems
Polyfluoroalkyl substances (PFAS) are a group of manmade chemicals designed
to be non-stick, waterproof, and flame-resistant that have been linked to
various health problems, including certain cancers which are of major concern
in key markets like the US and increasingly worldwide. The Company sponsored a
three and a half year PhD study at Swansea University in Wales which will
complete in Q1 2025. The work at Swansea has demonstrated that the Microsaic
PFAS analysis system (based on our MiD4500 mini mass spectrometer) is market
leading and the only truly mobile unit 'point of use' system in the world for
PFAS detection and measuring systems. It has demonstrated accuracy of testing
(to levels within legislative limits) over all the commonly known PFAS
chemicals including those of emerging concern. More specifically our PFAS
Detector has a unique leading edge capability as it can accurately detect
Fluorotelomer Alcohols (FTOHs), precursors to many common PFAS species which
conventional testing techniques cannot accurately measure. These emerging FTOH
chemicals can take generations to break down and have been identified as as a
"developmental toxicant" damaging to human health particularly children.
With miniaturisation offering portability and a much lower energy usage and
carbon footprint, the Microsaic analysis system offers a highly sustainable
PFAS Detection system that can be flexibly operated within a laboratory or
field environment to help future-proof such pollution measurement. The PFAS
Detector is being modified to detect PFAS in both water and soils for
comprehensive testing use.
Industrial Effluent Discharge Monitoring
The Company has identified a potentally large but underserved market in online
live data monitoring of industrial effluent water discharge. Certain
industries utilise large amounts of water and discharge the post usage water
into the environment. The Company has a unique CTM technology that can detect
toxins within minutes enabling fast shutdown at the point of water discharge
if such toxins are detected. As part of our business development strategy,
marketing of our CTM technology for this industrial usage is underway.
Board Composition
The Company recognises that good corporate governance is important both for
the interests of shareholders and to support the future growth of the
business. The Board is committed to strengthening the Board through the
addition of at least one sector and UK public company experienced independent
non-executive director to the board in early 2025 and discussions are taking
place with prospective candidates.
Cash
Save for the changes to the Avanceon payment plan notified above, the Company
confirms there has been no material change to its current cash position and
cashflow forecasts remain as presented in its H1 2024 Interim Update on 12
November 2024. Current opening cash as of 13 January 2025 is £259k.
Furthermore, the Company is applying for a £80k research and development tax
credit for 2023 expenditure.
Bob Moore, Microsaic Systems' Acting Executive Chairman, commented:
"We are delighted that actual sales and forecast sales of our upgraded
Microtox® LX instruments are showing strong growth from an international
market. Also we have reinstigated the Qatar project having fully complied with
the contract terms and have received an agreed interim payment for phase one.
Following the significant investment in our compatible suite of technologies
for toxic water testing and PFAS, and one year on from the acquisition of the
Modern Water business, we are now demonstrating that the business reset and
new model is bringing results with an optimistic outlook for 2025."
Microsaic Systems plc +44 (0) 20 3657 0050
Bob Moore, Acting Executive Chairman via Turner Pope
Singer Capital Markets (Nominated Adviser & Joint Broker) +44 (0)20 7496 3000
Alex Bond / Oliver Platts
Turner Pope Investments (TPI) Limited (Joint Broker) +44 (0) 20 3657 0050
Andy Thacker / James Pope
About Microsaic Systems Group
Microsaic is highly experienced in the development, manufacture and supply of
microelectronics instrumentation for markets requiring analytical testing in
public and environmental health markets. The Company has recently acquired and
integrated the assets of Modern Water with Microsaic Systems' technologies
resulting in comprehensive water testing and other toxic testing capabilities.
Microsaic's products and solutions are commercially available through global
markets via a network of regional and country specific distributors and
partners.
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