REG - Newmark Security PLC - Year-end trading update

Newmark SecurityAnnouncement

24/05/2022 07:00

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RNS Number : 5138M  Newmark Security PLC  24 May 2022

This announcement contains inside information for the purposes of Regulation
11 of the Market Abuse (amendment) (EU Exit) Regulations 2019/310.

 

Newmark Security plc

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

 

Year-end trading update

 

Top-line growth despite market challenges

 

Well-positioned to capitalise on market opportunities, building a resilient
business model.

 

Newmark security plc (AIM: NWT), a leading provider of electronic and physical
security systems, today provides an update on trading for the year ended 30
April 2022 ("FY 2022").

 

Highlights:

 

·    Confirmation of FY 2022 year-on-year revenue growth, driven by Human
Capital Management ("HCM") sales in the US.

·    Product innovation and efficient software systems have enhanced our
solutions offering, driving new client contracts.

·    Product initiatives are set to increase recurring revenues, an area
of strategic focus.

·    Continued to invest in people and infrastructure to fuel sustainable
growth.

 

As noted in the Company's half year report, announced on 27 January 2022,
sharp increases in componentry and freight costs have impacted the Group's
margins. However, the Company has implemented a programme of strict cost
management and increased its prices to mitigate the effect of higher input and
freight costs. This has resulted in reduced losses for the second half of the
year compared to H1.

 

Operations

 

People and Data Management division - Grosvenor Technology

 

·      New product development continues in the Human Capital Management
and Access Control businesses to capture positive market momentum and increase
market share.

·      Launching a new HCM SaaS Cloud platform that will further
increase high margin, recurring revenues.

·      Continue to deliver market-leading secure data processing
complying with international standards such as ISO27001.

·      Currently exploring the establishment of a new manufacturing
facility in the US, a fast-growing and large market.

·      Investing in human capital and infrastructure to drive business
growth and underpin the "will-to-win" vision.

 

 

Physical Security Solutions division - Safetell

 

·      Nick Shannon joined in February from G4S Secured Solutions to
head up the division. He will lead the strategic focus to build the services
side of the business with the aim of increasing the proportion of recurring
revenues.

·      We have successfully launched new products, expanded our client
base, and formed new partnerships.

 

Financial Position

 

·      Recently secured a $2m US invoice discounting facility to provide
additional working capital headroom.

·      Successfully managed supply chain challenges by building
inventory to satisfy ongoing customer demand and stay ahead of the
competition.

·      Working capital level is expected to ease as we reduce inventory
held, allowing for cash flow generation.

·      We are fully utilising our recent investments in products and
infrastructure to fuel our future growth.

·      We are continuing to implement strict cost management that,
together with increased selling prices, are expected to mitigate the effect of
higher input and freight costs.

·      We expect to see the full benefit of the price rises and cost
savings in the year ending 30 April 2023.

 

Maurice Dwek, Chairman of Newmark, commented:

 

"I am pleased with the progress in executing our strategy and setting the
right foundations for success. We are delivering on our targets for revenue
growth and cost management initiatives whilst focusing on our new product
pipeline that provides us with the ability to offer complete solutions to our
clients continuously.

 

Our proactive approach during the pandemic demonstrated our agility to manage
the business for the long term, building credibility and client preference. We
have high confidence in our product portfolio and client-focused strategy,
remaining agile and prioritising our investments with discipline to continue
to drive sustainable growth.

 

I am confident that we have taken the right measures, working towards an
optimal structure and product mix to drive our business forward. Moreover, we
are well placed to further scale our business by identifying the appropriate
opportunities that will synergise and complement our product offering."

 

 Newmark Security plc
 Marie-Claire Dwek, Chief Executive Officer      Tel: +44 (0) 20 7355 0070

Paul Campbell-White, Chief Financial Officer

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

 Allenby Capital Limited                         Tel: +44 (0) 20 3328 5656

 (Nominated Adviser and Broker)
 James Reeve / Liz Kirchner (Corporate Finance)

 Amrit Nahal (Sales & Broking)

 

About Newmark Security plc

 

Newmark is a leading provider of electronic, software and physical security
systems that helps organisations protect human capital and provide safe spaces
seamlessly and securely.

From our locations in the UK and US, we operate through subsidiary businesses
positioned in specialist, high-growth markets.

We foster an open and inclusive work environment amongst our c.100 employees,
serving hundreds of blue-chip customers.

Our product portfolio consists of Human Capital Management and Access Control
Systems providing both hardware and software and Physical security
installations to various sectors.

 

Newmark Security plc is admitted to trading on AIM (AIM:NWT).

For more information, please visit: https://newmarksecurity.com/
(https://newmarksecurity.com/)

Safe. Seamless. Secure

 

 

 

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