REG - Sabien Technology - Half-year Report for the 6 months to 31 Dec 2023
19/02/2024 07:30
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RNS Number : 5882D Sabien Technology Group PLC 19 February 2024
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF REGULATION
11 OF THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019/310
19 February 2024
Sabien Technology Group Plc
("Sabien", the "Company" or the "Group")
Unaudited Interim Results for the six months ended 31 December 2023
Sabien Technology Group plc (AIM: SNT), the company focused on a green
aggregation strategy, today announces its unaudited interim results for the
six-month period ended 31 December 2023 (the "Period"). Comparative figures
are shown for the comparable period in the previous financial year unless
otherwise stated:
Financial highlights
6 months to 31 December 2023 6 months to 31 December 2022 Year to
30 June
2023
Unaudited Unaudited Audited
Sales revenue £'000 369 238 1,098
Sales orders received £'000 386 212 1,136
Sales invoices raised £'000 320 189 1,118
Gross profit margin % 62 51 64
Net loss after tax £'000 (371) (437) (702)
Cash at end of period £'000 176 354 436
Executive Chairman's Statement
It is very pleasing to report interim results which so clearly demonstrate
progress. Revenue growth of 55% highlights the success of M2G in both raising
awareness and innovating within its core product suite. That this translated
into an 88.4% improvement in gross profit validates this strategy. The 82%
increase in orders received underpins my confidence in further growth.
This confidence extends to the development of b.grn. Our recent progress in
the US has brought the generation of a positive return much closer. Like M2G
before it, b.grn's concept requires wider awareness of the benefits in order
to secure its growth. I am in no doubt that such awareness is more likely to
be achieved within US markets and that US awareness will drive adoption in
Europe.
M2G Business
M2G has continued to outperform its KPIs through the first half of the current
financial year. Specifically, it has achieved significant progress in raising
awareness of its products' benefits within a disparate range of customers. The
consequent growth in sales, billings, and orders is a testament to both M2G's
concept and its ability to innovate within this space.
M2G Cloud Connect has assisted customers in saving 1.41 million KgCO(2) in
just one year. As Cloud Connect is rolled out to US markets, it is expected
that these savings will increase further. M2G Evo is in the final stages of
development and is on the verge of CE and UL testing, the successful
conclusion of which will allow a wide launch. In addition, M2G Evo will
allow Sabien to access additional supply chains due to the use of common
components. This should reduce the cost of the product, thereby increasing
gross margin.
For the six months ended 31 December 2023, Sabien recognised M2G revenue of
£0.37m, an increase of over 1.5x on the comparative period (£0.24m). To 16
February 2024, Sabien has received orders in excess of £0.50m, an increase of
over 2x on the comparative period (£0.25m); and has invoiced £0.35m, an
increase of over 1.3x on the prior year (£0.27m). Recent orders include
an order from a new channel partner of £0.07m.
COF / b.grn Business
Sabien confirms that its affiliate company, b.grn Group Limited ("b.grn"), is
participating in a consortium of green energy and sustainability companies to
establish a resource cluster within a large, fast growing, environmentally
conscious, US city (the "City") which has approved this announcement. A
Mayor-led initiative established a global competition process more than two
years ago, and the successful responding group was selected in late December
2023. Under this initiative, through an agreement with the project
developer, b.grn will have the potential to construct and operate the first
US-based installation of COF technology on a site leased from the City. The
installation will process plastic waste both provided by the City and sourced
from private enterprises. b.grn envisions that the offtake products from the
proposed plant will be consumed within the City.
It is anticipated that this project, which is expected to be announced by the
City no later than Q3 of 2024, will attract significant funding and will be a
blueprint for wider technology adoption in the US and internationally. Under
existing contracts, Sabien will benefit for both sales commissions on the
supply of equipment to the project and a share of operational profits
generated by b.grn.
To drive the successful launch of this project the services of a circular
economy industry leader and former public company CEO have been secured to
lead negotiations with the City. An LOI/MOU detailing high level business
terms between the City, b.grn and other consortium members is likely to be
signed and announced in the next Quarter with an established contract or
contracts to be signed and announced no later than Q4 2024. It is likely
Sabien will need to invest in the initial administrative enablement of this
project to ensure the necessary external development funding is secured.
Proton Technologies Canada Inc. and Aeristech investment
Sabien is not focusing on these partners currently and there is no further
update since the 2023 annual report.
Parris Group Loan
Sabien currently has a funding requirement to bridge the timing of the
significant M2G order conversion into revenue, as well as requirements to
complete the M2G Evo development and continue with the COF/b.grn project.
To fund this requirement, my family company, Parris Group Limited ("PGL"), has
made a £0.2m debt facility available to Sabien.
The loan facility (the "New Loan") follows a previous PGL 12-month
arrangement, announced in March 2022, for £209,302.33, of which £5,135
including accrued interest remained outstanding as at 31 December 2023.
The key terms of the New Loan are as follows:
· Up to £200,000;
· Interest rate of 12% per annum;
· Interest payable quarterly;
· Repayable by agreement with the Sabien board of directors for an
initial period of 12 months unless replaced by another debt facility,
afterwards on demand; and
· Unsecured.
Summary
Against a turbulent background, Sabien has made considerable positive progress
in the first half of the current financial year. It has delivered and
developed such that further progress is more likely.
M2G has exceeded expectations; generating revenue at lower cost, winning
orders across geographies, and innovating within its product suite. b.grn has
achieved another milestone in its development trajectory. The expected signing
of terms with a US city will bring revenue generation closer and provide a
high-profile platform from which to raise awareness and adoption elsewhere.
I have argued that Sabien's development will not be linear. I remain of this
view, but I am now more confident that our businesses' growth prospects are
not dependent on the economic environment. Our challenge is to raise awareness
and having done so, to deploy successfully.
The scale and scope of our development is in our hands. I believe that we have
demonstrated this ability in our first half results. I am confident that it
will remain the case and that further growth is in prospect.
Richard Parris
Executive Chairman
19 February 2024
Related Party Transaction
Parris Group Ltd is a Company controlled by Richard Parris, the Executive
Chairman of the Company, and his family. The Board, other than Mr Parris,
considers, having consulted with Allenby Capital Limited, the Company's
nominated adviser, that the terms of the New Loan are fair and reasonable
insofar as its shareholders are concerned.
For further information: +44 20 7993 3700
Scott.fulton@sabien.com (mailto:Scott.fulton@sabien.com)
Sabien Technology Group plc
Richard Parris, Executive Chairman
Scott Fulton, Investor Relations
Allenby Capital Limited (Nominated Adviser)
John Depasquale / Nick Harriss / Vivek Bhardwaj +44 203 328 5656
Peterhouse Capital Limited (Broker) +44 207 469 0930
Duncan Vasey / Lucy Williams
Sabien Technology Group Plc
Unaudited Condensed Group Statement of Comprehensive Income for the period
ended 31 December 2023
Notes 6 months to 31 December 2023 6 months to 31 December 2022 Year to
30
June
2023
Unaudited Unaudited Audited
£'000 £'000 £'000
Revenue 369 238 1,098
Cost of Sales (141) (117) (394)
Gross Profit 228 121 704
Administrative expenses (597) (676) (1,331)
Exceptional item - - -
Operating loss (369) (555) (627)
Other income - 100 1
Finance cost (4) (3) (7)
Finance income 2 - 3
Impairment loss - - (99)
Loss before tax (371) (458) (729)
Tax credit - 21 27
Loss for the period attributable to equity holders of the parent company (371) (437) (702)
Other comprehensive income for the period - - -
(371) (437) (702)
Total comprehensive income for the period
Loss per share in pence - basic 3 (1.71)p (2.12)p (3.59)p
Loss per share in pence - diluted 3 (1.71)p (2.12)p (3.59)p
Sabien Technology Group Plc
Unaudited Condensed Group Statement of Financial Position as at 31 December
2023
Notes 31 December 2023 31 December 2022 30 June
2023
Unaudited Unaudited Audited
£'000 £'000 £'000
ASSETS
Non-current assets
Property, plant and equipment 1 2 1
Other intangible assets 155 126 112
Investments 382 300 382
Total non-current assets 538 428 495
Current assets
Inventories 114 45 79
Trade and other receivables 37 454 202
Cash and cash equivalents 176 354 436
Total current assets 327 853 717
TOTAL ASSETS 865 1,281 1,212
EQUITY AND LIABILITIES
Current liabilities
Trade and other payables 542 289 500
Borrowings 39 39 39
Total current liabilities 581 328 539
Non-current liabilities
Borrowings 54 91 72
Total non-current liabilities 54 91 72
EQUITY
Equity attributable to equity holders of the parent
Share capital 4 3,563 3,563 3,563
Other reserves 4,018 4,014 4,018
Retained earnings (7,351) (6,715) (6,980)
Total equity 230 862 601
TOTAL EQUITY AND LIABILITIES 865 1,281 1,212
Sabien Technology Group Plc
Unaudited Condensed Group Cash Flow Statement for the period ended 31 December
2023
6 months 6 months Year
to to to
31 December 2022 31 December 2022 30 June
2023
Unaudited Unaudited Audited
£'000 £'000 £'000
Cash flows from operating activities
Loss after taxation (371) (437) (702)
Adjustments for:
Depreciation and amortisation 31 31 64
Impairment loss on investments - - 99
Foreign currency reserve movement 1 5 6
Taxation - (21) (27)
Finance cost 4 3 7
Less movement in interest accrual - (2) (1)
Decrease / (increase) in trade and other receivables 166 (62) 29
Increase in inventories (35) (4) (39)
Increase / (decrease) in trade and other payables 40 (207) 12
Net cash outflow from operating activities (164) (694) (552)
Cash flows from investing activities
Investments acquired - (100) (89)
Purchase of intangible assets (74) (6) (24)
Loan advance to associated undertaking - - (37)
Research and development corporation tax refund - - 27
Net cash used in investing activities (74) (106) (123)
Cash flows from financing activities
Repayment of borrowings (18) (18) (36)
Interest paid (4) (2) (6)
Proceeds from share issues - 600 600
Share issue costs (20) (20)
Net cash (used in) / generated by financing activities (22) 581 538
Net decrease in cash and cash equivalents (260) (219) (137)
Cash and cash equivalents at beginning of period 436 573 573
Cash and cash equivalents at end of period 176 354 436
Sabien Technology Group Plc
Unaudited Condensed Group Statement of Changes in Equity as at 31 December
2022
Share capital Share premium Other reserves Retained earnings Total equity
£'000 £'000 £'000 £'000 £'000
Balance at 1 July 2022 3,354 3,543 1 (6,278) 620
- - - (437) (437)
Loss for the period
1 July 2022 to
31 December 2022
Share issue 209 488 - - 677
Share issue costs - (20)
Foreign exchange variance - - 2 - 2
3,563 4,011 3 (6,715) 862
Balance at 31 December 2022
- - - (265) (265)
Loss for the period
1 January 2023 to 30 June 2023
Warrants lapsed - 10 (10) - -
Foreign exchange variance - - 4 - 4
3,563 4,021 (3) (6,980) 601
Balance at 30 June 2023
- - - (371) (371)
Loss for the period
1 July 2023 to
31 December 2023
3,563 4,021 (3) (7,351) 230
Balance at 31 December 2023
Sabien Technology Group Plc
Notes to the Financial Statements for the period ended 31 December 2023
1. Accounting policies
The interim financial information has not been audited or reviewed by the
auditors and does not constitute statutory accounts for the purpose of
Sections 434 and 435 of the Companies Act 2006.
The financial information in this document has been prepared using accounting
principles generally accepted under International Financial Reporting
Standards and is consistent with those used in the preparation of the most
recent annual financial statements.
These interim financial statements for the six-month period ended 31 December
2023 have been prepared using the historical cost convention, on a going
concern basis and in accordance with applicable UK adopted International
Financial Reporting Standards.
The financial statements for the year ended 30 June 2023 have been delivered
to the Registrar of Companies and filed at Companies House and the auditors'
report on those financial statements was unqualified. The auditors' report
did not contain a statement made under Section 498(2) or Section 498(3) of the
Companies Act 2006.
2. Segmental reporting
Based on risks and returns, the directors consider that the primary reporting
business format is by business segment which is currently just the supply of
energy efficiency products, as this forms the basis of internal reports that
are regularly reviewed by the Company's chief operating decision maker in
order to allocate resources to the segment and assess its performance.
Therefore, the disclosures for the primary segment have already been given in
interim financial information. The secondary reporting format is by
geographical analysis by destination. Non-UK revenues amounted to £2k which
were less than 1% of total revenues for the period.
During the period, sales to the Group's largest customers were as follows:
Sales revenue % of total revenue
£'000
Customer 1 196 53
Customer 2 47 13
Customer 3 31 8
Customer 4 18 5
3. Loss per share
The calculation of the basic loss per share is based on the loss attributable
to the ordinary shareholders, divided by the weighted average number of shares
in issue in the period.
6 months to 31 December 2023 6 months to 31 December 2022 Year to
30
June
2023
Unaudited Unaudited Audited
£'000 £'000 £'000
Loss for the period (371) (535) (702)
Basic and Diluted:
Weighted average number of shares in issue 21,695,168 20,532,668 20,651,081
Loss per share - basic and diluted (1.71)p (2.12)p (3.59)p
4. Share capital
The Company's issued Ordinary share capital is:
Amount No. of New Ordinary Shares of 3p each No. of Deferred Shares of 4.5p each No. of New Deferred Shares of 0.49p each
£'000
Allotted, called up and fully paid:
At 31 December 2023 3,563 21,695,168 44,004,867 190,254,867
At 30 June 2023 3,363 21,695,168 44,004,867 190,254,867
At 31 December 2022 3,563 21,695,168 44,004,867 190,254,867
5. Share options and warrants
At the period end date, the following options had been granted:
Grant date Number of instruments Exercise price Contractual life of instruments
31 October 2014 117 £163.5 October 2024
At the period end date, there were no warrants outstanding (31 December 2022:
1,675,349, 30 June 2023: nil).
In February 2023, 1,675,349 outstanding warrants expired.
6. Seasonality
The business of the Group is not seasonal.
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