REG - Surgical Innovations - Final Results
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RNS Number : 2040B Surgical Innovations Group PLC 21 April 2026
Surgical Innovations Group plc
("Surgical Innovations", the "Company", or the "Group")
Final Results
Results for the year ended 31 December 2025
Optimising for growth: 2025 as a springboard for future performance
Surgical Innovations Group plc (AIM: SUN), the designer, manufacturer and
distributor of innovative medical technology for minimally invasive surgery
("MIS"), reports its audited final results for the year ended 31 December 2025
("FY25").
Financial highlights:
· Revenues broadly flat at £11.6m (2024: £11.9m)
Ø Overall, SI Branded products decreased 8% to £5.9m (2024: £6.4m), driven
by tariff headwinds in the USA and structural sales challenges with our
partner in India
Ø Positively, Europe demonstrated strong growth of 23% with sales reaching
£2.1m in 2025 (2024: £1.7m) driven by the continued resonance of the Group's
sustainability messaging, a key differentiator for SI Branded products
Ø Encouraging increase in UK distribution revenues by 14% to £4.1m (2024:
£3.6m) as strategy to add high value devices to portfolio shows dividends
Ø OEM sales experienced a decline of 12% to £1.7m in 2025 (2024: £1.9m)
as previously indicated as a result of a strong 2024 which included the
clearance of prior-year backorders. This was further impacted by supply
constraints relating to a component provided by a key OEM partner which has
now been resolved
· Underlying gross margins increased by 262 bps to 33.73% (2024: 30.65%) as a
result of a change in product mix towards Elemental products
· Adjusted EBITDA loss in 2025 of £0.4m (2024: profit of £0.05m)
· Adjusted EPS loss of 0.08p per share (2024: 0.07p per share loss)
· Net cash inflow from operations amounted to £0.6m (2024: outflow of £0.10m)
as a result of strong cash management during period
· The Group's closing net cash(1) balances as of 31 December 2025 amounted to
(£0.3m) (as at 31 December 2024: (£0.3m))
(1) Net cash balances consists of cash at bank, less bank borrowings and
invoice financing facilities in use.
Commercial and operational highlights:
· Focus on working capital management in 2025 positions business well to take
advantage of future growth opportunities
· Implementation of targeted operational efficiencies and cost-down product
initiatives delivering margin improvement across the business
· Increased investment in both UK and international sales and marketing
capabilities, driving a growing pipeline of opportunities and improved account
conversion rates across key markets
· Strong performance in UK third party sales underpinning the strategic focus on
high-margin, high quality revenue streams and improving the product sales mix
· Ongoing alignment of sales strategy with core markets, supporting scalable and
profitable growth opportunities
· The Board was strengthened during the period with the appointments of Roy
Davis as Chair, Andrew Boteler as Senior Independent Director, and Duncan
Soukup as Non-Executive Director, bringing a wealth of experience to support
and accelerate the Company's growth
Current trading and outlook:
· Positive sales performance in Q1 provides a solid start to the year and
reinforces confidence in returning the business to growth in 2026
· Continued focus on cost-down initiatives and operational efficiencies is
expected to drive further margin improvement, improving profitability and cash
generation across the business
· Increasing adoption of environmentally friendly procurement solutions by
healthcare providers aligns with the Group's sustainability strategy,
positioning its products to meet growing market demand and strengthen our
competitive advantage
· Securing Medical Device Regulation (MDR) certification paves the way for the
launch of new devices to expand the product portfolio and support growth in
both existing and new markets
· Ongoing strategic investments in sales, marketing, and international expansion
aim to capitalise on market opportunities, improve account conversion, and
deliver long-term value for shareholders
· The Board is reviewing the business's strategy with a view to identify options
to optimise shareholder value going forward. The Board will update the market
in due course
Chairman of Surgical Innovations, Roy Davis, said: "The Company delivered a
resilient performance in what was a challenging year. With a positive start to
2026, a focus on the basics and several strategic initiatives underway, the
Company is better positioned for future growth and long-term success. Our
focus on sustainability-led market expansion, targeted distribution
partnerships, and innovative product additions will continue to strengthen the
Company's competitive position. Concurrently, ongoing cost-optimisation
initiatives are enhancing profitability and supporting sustainable
operations.
"As the year unfolds, the Company remains committed to
seizing emerging opportunities, delivering high-quality solutions, and
creating lasting value for both our customers and stakeholders. The Board is
committed to capitalising on the opportunities ahead and believes the business
is well placed to deliver significant long-term shareholder value."
This announcement and investor presentation have been made available online at
https://www.sigroupplc.com/investors-centre/
(https://www.sigroupplc.com/investors-centre/) .
Investor Presentation
David Marsh, Chief Executive Officer, and Brent Greetham, Chief Financial
Officer, will provide a live presentation relating to the final results via
the Investor Meet Company platform today, Tuesday 21 April 2026 at 11.00am
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
09.00. 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 Surgical Innovations Group plc via:
https://www.investormeetcompany.com/surgical-innovations-group-plc/register-investor
(https://url.uk.m.mimecastprotect.com/s/_fohCrAzh8Q463s7fnf4NtOV?domain=investormeetcompany.com)
. Investors who already follow Surgical Innovations Group plc on the
Investor Meet Company platform will automatically be invited.
For further information please contact:
Surgical Innovations Group plc www sigroupplc com (http://www.sigroupplc.com/)
David Marsh, CEO Tel: 0113 230 7597
Brent Greetham, CFO
Singer Capital Markets (Nominated Adviser & Broker) Tel: 020 7496 3000
Alex Bond / Graham Hertrich / Anastassiya Eley
Walbrook PR (Financial PR & Investor Relations) Tel: 020 7933 8780 or si@walbrookpr.com (mailto:si@walbrookpr.com)
Paul McManus / Lianne Applegarth Mob: 07980 541 893 / 07584 391 303
About Surgical Innovations Group plc
The Group specialises in the design, manufacture, sale and distribution of
innovative, high quality medical products, primarily for use in minimally
invasive surgery. Our product and business development is guided and supported
by a key group of nationally and internationally renowned surgeons across the
spectrum of minimally invasive surgical activity.
We design, manufacture and source our branded port access systems, surgical
instruments and retraction devices which are sold directly in the UK home
market through our subsidiary, Elemental Healthcare, and exported widely
through a global network of trusted distribution partners. Many of our
products in this field are based on a "resposable" concept, in which the
products are part reusable, part disposable, offering a high quality and
environmentally responsible solution at a cost that is competitive against
fully disposable alternatives.
Elemental also has exclusive UK distribution for a select group of specialist
products employed in laparoscopy, bariatric and metabolic surgery, hernia
repair and breast reconstruction.
In addition, we design and develop medical devices for carefully selected OEM
partners and have also collaborated with a major UK industrial partner to
provide precision engineering solutions to complex problems outside the
medical arena.
We aim for our brands to be recognised and respected by healthcare
professionals in all major geographical markets in which we operate and
provide by development, partnership or acquisition a broad portfolio of cost
effective, procedure specific surgical instruments and implantable devices
that offer reliable solutions to genuine clinical needs, the Company's
resposable portfolio enables healthcare providers to reduce both plastic waste
and their CO2 footprint as they strive for net zero.
Further information
Further details of the Group's businesses and products are available on the
following websites:
www.sigroupplc.com (http://www.sigroupplc.com)
www.surginno.com (http://www.surginno.com/)
www.elementalhealthcare.co.uk (http://www.elementalhealthcare.co.uk)
To receive regular updates by email, please contact si@walbrookpr.com
(mailto:si@walbrookpr.com)
Chairman's Statement
For the year ended 31 December 2025
The Company delivered a resilient performance in what was an exceptionally
challenging year. Sales of £11.6 million reflect the strength of our customer
relationships and the commitment of our team. In the face of headwinds in
global healthcare markets and supply chain pressures, we remained focused on
operational discipline and long-term value creation. Encouragingly, the
actions we have taken over the past year and our continued focus on the
basics, position us well for improvement and we look ahead with confidence
that the year ahead will show a return to growth and enhanced performance.
Market overview
In today's market, healthcare systems continue to face the considerable
challenge of reducing the backlog of elective procedures, which remains in
excess of seven million treatment pathways in the UK alone. At the same time,
rising supply chain costs and periodic disruption have resulted in backorders
of certain critical components, adversely affecting sales performance. In the
UK this has been compounded by ongoing industrial action by doctors, impacting
surgical procedures.
Despite these headwinds, the increasing emphasis on environmental
sustainability is reshaping procurement priorities across the healthcare
sector. Providers are not only seeking to improve efficiency and reduce
waiting lists, but also to embed more sustainable practices within their
operations and supply chains. In our core markets, this shift is translating
into growing demand for solutions that reduce waste and environmental impact
without compromising clinical performance.
Against this backdrop, the Company's Resposable™ technology is strongly
aligned with evolving customer needs. By combining reusable and single-use
elements, it offers a cost-effective and environmentally responsible
alternative to fully disposable devices, positioning Surgical Innovations to
benefit as surgical backlogs are progressively addressed and sustainability
becomes an ever more important purchasing criterion.
Financial overview
The Group recorded revenues of £11.6m (2024: £11.9m), reflecting an 8%
decline in SI Branded product sales to £5.9m (2024: £6.4m), offset by an
encouraging increase in distribution revenue of 14% to £4.1m (2024: £3.6m).
Tariff headwinds in the USA and a temporary slowdown in India, as our partner
rebuilds its in-country sales team, have impacted SI Branded product sales.
In the UK, the market was particularly affected by a reduction in bariatric
procedures due to the impact of drug treatments, which notably affected sales
of gastric calibration tubes, whilst these new treatments remain popular the
Company expects to see a modest increase in procedures during 2026. Also in
the UK, sales of third-party products grew substantially to £4.05m (2024:
£3.62m), reflecting the effectiveness of our strategy to prioritise
high-growth opportunities and foster strong partnerships with leading
suppliers. This growth demonstrates our ability to identify and capitalise on
market trends, strengthen relationships with key partners, and deliver value
to both customers and shareholders, even in a challenging operating
environment.
In Europe, SI Branded sales have demonstrated strong growth, reaching £2.08m
in 2025 (2024: £1.73m). This increase was driven by the continued resonance
of our sustainability messaging, which has struck a chord with healthcare
providers and distributors in key European markets. Our focus on
environmentally responsible products, combined with targeted marketing and
educational initiatives, has reinforced our reputation as a trusted and
innovative partner.
The OEM business declined during the year, following a strong 2024 which
included the clearance of prior-year backorders. This was further impacted by
supply constraints relating to a component provided by a key OEM partner.
Looking ahead, the Company expects robust growth in 2026, supported by a
strong sales forecast from our long-term partner AMS, underpinned by a new
contract that positions us positively for the year. The OEM business has been
further strengthened by the development of new relationships with two global
instrument manufacturers.
Operational and supply chain challenges have impacted margins and
efficiencies, driven by inflationary pressures on key components, extended
lead times, and complex regulatory requirements.
Adjusted EBITDA decreased to a loss of £0.4m (2024: profit of £0.05m) due to
the operational and supply chain challenges outlined above. Adjusted Loss Per
Share amounted to 0.08 pence (2024: £0.07p).
Throughout the financial year, the Group experienced a cash inflow of £0.6m
from operations (2024: cash outflow of £0.1m). Capital expenditure remained
consistent at £0.2m (2024: £0.1m). Product innovation remains a key
strategic pillar, with total investment in research expenses for the year
amounting to 10.9% of revenue (2024: 9.6%).
The Group's closing net cash balances as of 31 December 2025 amounted to
(£0.3m) (2024: (£0.3m)). This comprises of cash at bank of £0.8m (2024:
£0.2m), less bank borrowings of £0.2m (2024: £0.5m), less invoice financing
facilities in use of £0.9m (2024: £nil).
Strategy and development
The Group specialises in the design, manufacture, sale and distribution of
innovative, high-quality medical devices, principally for use in minimally
invasive surgery. We develop, manufacture and source our portfolio of branded
port access systems, surgical instruments and retraction devices, which are
sold directly in the UK through our subsidiary, Elemental Healthcare, and
exported extensively through a well-established global distribution network. A
number of our products are founded on a "Resposable(TM)" concept, combining
reusable and disposable elements to deliver high clinical performance in a
cost-effective and environmentally responsible manner, offering a compelling
alternative to fully disposable solutions.
Elemental Healthcare also holds exclusive UK distribution rights for a
carefully selected portfolio of specialist products supporting laparoscopy,
bariatric and metabolic surgery, hernia repair, breast reconstruction, upper
gastrointestinal and colorectal procedures. In addition, we design and develop
medical devices for a number of strategically chosen OEM partners.
Our strategic objective for our brands is to be recognised and trusted by
healthcare professionals across all core markets in which we operate. Through
sustained internal innovation, disciplined strategic partnerships and targeted
acquisitions, we continue to build a comprehensive portfolio of
cost-effective, procedure-specific surgical instruments and implantable
devices, delivering practical, innovative solutions that address real clinical
needs within the operating theatre.
The Board is focused on optimising our business operations, strengthening our
product portfolio and growing sales through our direct UK sales force and
international distributor partners to deliver improved financial
performance. In the short team, we are focussed on delivering on the basics
of increasing sales, improving profitability and cash generation. As such the
Board is closely examining opportunities to create value for shareholders
through a mixture of strategic options.
Regulatory and new product development
The Company successfully achieved certification under the Medical Device
Regulation (MDR) in the year. This is a significant milestone that underscores
our commitment to the highest standards of quality, safety, and regulatory
compliance. Achieving MDR certification not only validates our robust systems
and processes but also positions us to accelerate new product development and
expand registration into new markets.
In addition, the Company has successfully completed its annual audits for the
Medical Device Single Audit Program (MDSAP) and the UKCA mark, further
demonstrating our ongoing dedication to regulatory excellence across multiple
regions. These achievements reinforce our strong compliance framework and
provide a solid foundation for future growth and innovation.
Following the successful completion of our transition to MDR and UKCA
certification, we are now well positioned to focus our full attention on
strengthening and expanding our product pipeline. The first half of the year
will see the addition of LogiTube Lux, Logi Grasp, and Logi Dissect to our
portfolio, further enhancing the breadth and competitiveness of our offering.
Investment in new product development underscores our commitment to
sustainability, with a strong emphasis on accelerating time-to-market and
implementing cost-saving measures to enhance profitability.
In parallel, we have commenced the rollout of targeted cost-reduction
initiatives. These projects are expected to deliver meaningful margin
improvements across several of our key product lines, supporting both
profitability and long-term shareholder growth value.
Operational update
Our operational focus continues to centre on driving efficiency across the
facility. Key initiatives include enhanced automation in critical areas, aimed
at improving both quality and throughput. These enhancements are helping to
standardise processes and ensure consistent product excellence.
In recent years, the Company has made significant progress in reducing its
operational cost base. Over the year, focus has shifted towards improving
product margins through targeted cost reduction initiatives. Together, these
operational improvements strengthen our manufacturing capabilities and support
sustainable margin improvement.
Board and executive management update
It was a privilege to join the Board of Surgical Innovations in September
2025, and we welcome both Andrew Boteler and Duncan Soukup, who joined the
Board alongside me. Andrew brings considerable financial and governance
experience from his executive and non-executive career, and his appointment as
Chair of the Audit and Remuneration Committees strengthens our oversight
capabilities as we seek to focus on delivering shareholder value. Duncan
brings deep investment expertise and a long-term perspective as a significant
shareholder, and I believe his alignment with the Company's interests will be
a valuable asset to the Board.
At the same time Jonathan Glenn and Keyvan Djamarani stepped down from the
Board upon our appointment, I would like to give my sincere thanks to Jon and
Keyvan for their contribution to the business.
Separately Brent Greetham has announced his intention to step down from the
Board and his role as CFO, I would like to thank him for his contribution to
the business. The Company is at an advanced stage of recruiting a CFO and
will make further announcement in time.
I am delighted to be working alongside David Marsh and the management team, as
well as my fellow non-executive colleagues Andy and Duncan, as we look to
build on the foundations that have been laid. The Board is united in its focus
on delivering value for shareholders over the medium term, and I look forward
to reporting on our progress.
The Board would like to thank Jon and Keyvan for their valued contribution and
commitment to the Company during their tenure. I would also like to thank
Brent for his efforts during the past year.
As we move forward the Board remains committed to maintaining strong
leadership and oversight of the business and is focussed on maximising
shareholder value.
Current trading and outlook
Sales during Q1 2026 have been in line with management expectations, with
ongoing investment in sales and marketing helping to drive new opportunities
across key markets. Several major account conversions are underway, reflecting
both the strength of our product offering and growing market interest.
The Company remains well positioned to capitalise on these opportunities,
leveraging its innovative solutions, sustainability-led value proposition, and
targeted sales initiatives to drive growth across key markets.
Looking ahead, we plan to extend the Logi™ range during the second half of
2026, reinforcing our innovation pipeline and strengthening our presence in
this specialist segment. These strategic launches demonstrate our continued
commitment to product development and our ability to respond effectively to
emerging market opportunities across all key territories.
During 2026, we will deliver a series of targeted cost-reduction initiatives
designed to enhance margins across key Resposable™ products. These
programmes are centred on optimising material selection, refining component
design and introducing functional improvements that reduce manufacturing costs
while maintaining, and where possible enhancing, product performance.
Following the successfully renegotiated distribution agreement with Microline
Surgical highlighted in last year's results, the revised agreement is valued
at an anticipated £9 million over the next five years, reinforces a
long-standing partnership and providing a solid foundation for shareholder
value.
We also made significant progress with Aspen Surgical, where our agreement
delivered over £1 million in first-year sales, with further expansion
expected in 2026.
The recent extension of key distribution agreements, along with the
establishment of new partnerships, further reinforces Elemental's market
presence and growth potential. As the year unfolds, the Company remains
committed to seizing emerging opportunities, delivering high-quality
solutions, and creating lasting value for both our customers and stakeholders.
We are fortunate to work in a business that helps clinicians deliver positive
outcomes to their patients every day. It is a privilege to work with our
customers to help them make a difference and I would like to thank all of our
customers for their continued use of our products and the trust they place in
us to support the work they do.
I would also like to thank our employees and partners around the world for all
their hard work. It is their dedication that makes Surgical Innovations the
company that it is and I am proud of their efforts in rising to the daily
challenges we face as a business in such a positive way.
Finally, I would like to thank our shareholders for their continuing support
for the business. I believe we are now moving in the right direction and will
be able to deliver on the potential the business has.
I would like to summarise by re-iterating my continued belief and confidence
in the Group's ability to capitalise on the opportunities ahead and is well
placed to deliver significant long-term shareholder value.
Roy Davis
Chairman
21 April 2026
Operating and Financial Review
New board configuration
During the year, the Board underwent a number of changes which mark an
important phase in the development of the Company's governance for the future.
This began with the departure of Chris Martin, Chief Financial Officer, in
February 2025, followed by the appointment of Brent Greetham. Our largest
shareholder, Thalassa, requested Board representation and nominated Duncan
Soukup for appointment as a Director. At the same time, Jon Glenn and Keyvan
Djamanari informed the Board of their intention to step down as Chairman and
Independent Non-Executive Directors respectively. Following these changes, we
were pleased to welcome Roy Davis as Chair and Andrew Boteler as Independent
Non-Executive Directors.
Roy brings more than 35 years of international leadership experience across
the medtech, diagnostics and technology sectors. He currently serves as
Chairman of Inspiration Healthcare Group plc and Foster & Freeman Ltd, and
as a Non-Executive Director of Futura Medical plc. He is also a Senior Advisor
to Moore Walker Partners.
Roy has previously held a number of chair roles within the healthcare sector,
including at LunglifeAI plc, Medica Group plc until its sale in 2023, and
Edinburgh Molecular Imaging Ltd and RAIR Health Ltd.
Prior to his non-executive career, Roy served as Chief Executive Officer of
Optos plc from 2008 to 2016, stepping down following its acquisition by Nikon
Corporation. Before that, he was Chief Executive Officer of Gyrus Group plc
until its acquisition by Olympus Corporation in 2008, having previously served
as Chief Operating Officer and earlier as a Non-Executive Director following
its flotation in 1997.
Andrew brings more than 30 years' experience across Executive and
Non-Executive roles in the financial sector. He currently serves as
Non-Executive Director and Audit Committee Chair at Octopus AIM VCT plc and as
Non-Executive Director and Audit Committee Chair at Cake Box Holdings plc. He
was previously a Non-Executive Director and Chair of the Remuneration and
Audit Committees at LunglifeAI plc, and has been a member of CEN Group
Holdings' Advisory Panel since 2021.
Earlier in his executive career, Andrew served as Chief Financial Officer of
Gooch & Housego PLC from 2009 to 2019 and as Finance Director of Riverford
Organic Farmers from 2019 to 2023.
Roy has assumed the role of Chair of the Nomination Committee and is a member
of the Remuneration and Audit Committees. Andrew has been appointed Chair of
the Audit and Remuneration Committees and is a member of the Nomination
Committee, with immediate effect.
Operational overview
People
Our employees are key to our business strategy, and we aim to attract, retain
and develop talented individuals.
Supply chain
Although supply chain disruptions eased to some extent, challenges remained
throughout 2025, particularly with prolonged lead times on components
affecting production efficiency. However, strengthened relationships with key
suppliers, supported by strategic investments in personnel, have led to
noticeable improvements. A thorough review of these initiatives will continue
into 2026 as part of the ongoing operational improvement plan.
Financial overview
Revenue
In 2025, the Group saw year over year revenues reduce to £11.6m, compared to
£11.9m in the prior financial year.
Surgical Innovations Branded (SI Branded) product revenues saw a decline of 8%
to £5.9m, compared to £6.4m in 2024; as a result of the impact of tariffs in
the USA, sales structural challenges with partner in India and decline in
bariatric procedures in the UK.
Distribution revenues encompass third-party products that complement the
manufactured product portfolio. In 2025, this segment contributed 35% of the
revenue, rising from 2024 levels (30%).
OEM sales experienced a projected decline from £1.9m in 2024 to £1.7m in
2025 - the 2024 number included the clearance of the backorder position and
was further impacted by a quality issue with a component supplied by an OEM
partner. However, a new agreement with long term partner, AMS, and strong
forecasts from partners will provide growth in 2026.
Our sustainability messaging continues to drive significant growth across
Europe. Strong sales of distribution products in the UK highlight the strength
of our relationships with key suppliers and reinforce the success of our
strategy to focus on high-quality, complementary technologies. Slower sales
in OEM meant an overall decline in the UK.
Tariffs in the US and structural challenges in India have created headwinds in
several key markets.
Margins
2025 2024
For margin analysis, the Group has divided the assessment between the £'000
underlying gross margin and the overall contribution margin. £'000
Revenue 11,602 11,945
Cost of Sales 7,688 (8,284)
Underlying Gross Margin 3,914 3,661
The net cost of manufacturing reflects the shortfall in recovering both fixed Underlying Gross Margin % 33.73% 30.65%
and variable costs, encompassing both direct and indirect expenses. Net Cost of Manufacturing 861 225
Contribution Margin 3,053 3,436
Contribution Margin % 26.31% 28.77%
The underlying gross margins have increased to 33.73% (2024: 30.65%).
We continue to focus upon our manufacturing operations including our supply
chain, on an ongoing basis.
Furthermore, given the mounting pressure on both direct and indirect costs, a
thorough review of absorption rates has been undertaken.
The emphasis on continuously improving margins is anticipated to remain a top
priority throughout the current year.
Use of adjusted measures
Adjusted KPIs are used by the Board to understand underlying performance and
exclude items which distort comparability, as well as being consistent with
broker forecasts and measures. The method of adjustments is consistently
applied but is not defined in International Financial Reporting Standards
(IFRS) and, therefore, are considered to be non-GAAP (Generally Accepted
Accounting Principles) measures. Accordingly, the relevant IFRS measures are
also presented where appropriate.
( )
2025 2024
EBITDA is defined as earnings before interest, taxation, depreciation and
amortisation including impairment).
£,000 £'000
Operating Loss (878.2) (791.0)
Adjusted EBITDA serves as a key measure of business performance, offering Depreciation 492.0 478.0
insight into the underlying performance of the Group. This metric excludes Amortisation 16.0 214.0
items that may distort comparability, such as the charge for share-based EBITDA (370.2) (99.0)
payments, which is a non-cash expense typically excluded from market Share based payments - -
forecasts. Non-recurring expenses - 150.0
Adjusted Measure (370.2) 51.0
( )
Adjusted EBITDA loss of £0.4m in 2025, compared to an adjusted EBITDA profit
of £0.05m in 2024.
( )
Financial position
Capital expenditure on tangible assets remained consistent with prior year,
amounting to £0.2m in 2025 (2024: £0.1m). The Group remains committed to
reviewing its capital expenditure and will continue to enhance its investment
plans. A review of the business priorities and operational improvements will
guide our focus in this area as we move further into 2026.
Investment in new product development continues, with expenditure in the year
of £0.2m (2024: £0.3m). While the business remains committed to research and
development, in 2025 we recognised an impairment charge of £0.15m against
capitalised development costs (2024: £1.16m), bringing the carrying value to
£nil at the end of both financial years.
A review of the goodwill arising from the acquisition of Elemental Healthcare
Ltd was conducted to assess further impairment. The trading environment in the
UK market is strong and based on this assessment, the recoverable amount of
the CGU is deemed to exceed it carrying value.
The presence of several impairment indicators within the business this year
necessitated a broader consideration of asset impairment beyond goodwill. A
review of the CGU of Surgical Innovations Ltd was conducted, and based on the
assessment, the amount of the CGU exceeds its recoverable amount.
Working capital
Inventory levels continue to be managed, adopting a lean methodology across
operations, whilst ensuring there is no risk to operational output or
satisfying customer orders. Inventory holdings were £2.2m at the year-end
(2024: £3.0m).
Trade receivables remained consistent at £1.6m at the year-end (2024:
£1.7m), with minimal risk associated with overdue balances. Trade payables
increased over the same period to £1.4m (2024: £1.1m).
Net cash inflow from operations amounted to £0.6m (2024: £0.1 outflow). The
Group concluded the year with net debt balances of (£0.3m) (2024: (£0.3m)).
Net cash balances consists of cash at bank, less bank borrowings and invoice
financing facilities in use.
The Group recorded a corporation tax credit of £0.05m in the year. (2024:
credit of £0.1m). Overall, the Group continues to hold substantial tax losses
on which it holds a cautious view, and consequently the Group has chosen not
to recognise those losses.
Key Performance Indicators ("KPIs")
The Group considers the key performance indicators of the business to be:
2025 2024 Target Measure
Underlying Gross Profit Margin Gross profit / revenue 33.7% 30.6% >40%
Direct Gross Profit Margin Contribution margin / revenue 26.3% 28.8% >40%
Net Debt Cash less debt (£0.3m) (£0.3m) N/A
Adjusted EBITDA (£0.4m) £0.05m NA
The Group also considers non-financial KPI's as part of its ongoing review of
business performance. These include but are not limited to operational
efficiencies, employee metrics and environmental metrics, as referenced in the
Environmental, Social and Governance section of the Annual Report.
Earnings per share
Earnings per share 2025 2024
Basic EPS (0.10p) (0.21p)
Loss attributable to shareholders (£0.89m) (£1.94m)
Add: Share based payments £0.00m £0.00m
Add: other expense/non-recurring items £0.00m £0.15m
Add: impairment loss £0.15m £1.16m
Adjusted loss attributable to shareholders (£0.74m) (£0.63m)
Adjusted EPS (0.08p) (0.07p)
Principal risks and uncertainties
The management of the business and the nature of the Group's strategy are
subject to a number of risks which the Directors seek to mitigate wherever
possible. The principal risks are set out below.
Issue Indication of risk on prior year Risk and description Mitigating actions
Margin constraints due to operational challenges Risk increased on prior year The Group encountered operational inefficiencies. The Company continues to review its manufacturing operations and supply chain
to identify opportunities for improvement. Measures have already been
implemented; including an internal restructuring designed to drive operational
savings, enhance efficiencies and boost productivity.
Customer concentration Existing risk remains at the same level from prior year The Group exports to over thirty countries and distributors around the world, The majority of distributors, including the most significant, are well
but certain distributors are material to the financial performance and established and their relationship with the Group spans many years. Credit
position of the Group. (As disclosed in note 2 to the financial statements, levels and cash collection is closely monitored by management, and issues are
one customer accounted for 11% of revenue in 2025 and the loss, failure or quickly elevated both within the Group and with the distributor.
actions of this customer could have a severe impact on the Group).
Regulatory Existing risk remains at the same level from prior year As an international business a significant proportion of the Group's products The Group has a dedicated Compliance department which assists product
require registration from national or federal regulatory bodies prior to being development teams with support as required to minimise the risk of regulatory
approval offered for sale. The majority of our major product lines have FDA approval in approval not being obtained on new products and ensures that the Group
the US and we are therefore subject to MDSAP audit and inspection of our operates processes and procedures necessary to maintain relevant regulatory
manufacturing facilities. approvals.
There is no guarantee that any product developed by the Group will obtain and Whilst there is no guarantee that this will be sufficient, the Group has
maintain national registration or that the Group will always pass regulatory invested in people with the appropriate experience and skills in this area
audit of its manufacturing processes. Failure to do so could have severe which mitigates this risk significantly.
consequences upon the Group's ability to sell products in the relevant
country.
The Group has now received MDR Certification on all products groups.
Economic factors Existing risk remains at the same level from prior year The business has been affected by rising employment costs and raw material Raw material purchases undergo a continual review, with economies of scale
expenses, and it is acknowledged that these pressures are likely to persist applied. Investment in the supply chain will yield benefits through enhanced
into 2026. supplier relations, while more effective inventory management will mitigate
further exposure.
There are also pressures upon labour costs, because of the 4.1% increase in
the National Living Wage in 2026. Increases in the cost of goods are mitigated and passed on where possible.
Supply chain delays in both raw materials and finished goods have affected the As a result of the introduction of tariffs by the US, and the evolving nature
business throughout 2025, though the impact has been less severe compared to of these tariffs, current global trade realignments are, on balance, creating
the previous year. Some disruption is expected in 2026. competitive advantages for our UK-based manufacturing. Our supply chain
remains well-positioned to navigate this evolving landscape with minimal
disruption anticipated, and the potential for market share gains
U.S. tariffs introduce near-term complexity.
David Marsh
CEO
21 April 2026
Consolidated statement of comprehensive income
for the year ended 31 December 2025
2025 2024
Notes £'000 £'000
Revenue 2 11,602 11,945
Cost of sales (8,549) (8,509)
Gross profit 3,053 3,436
Other operating expenses (3,781) (4,227)
Operating loss 3 (728) (791)
Impairment costs (150) (1,160)
Finance costs (66) (99)
Loss before taxation (944) (2,050)
Taxation credit 49 107
Loss and total comprehensive income (895) (1,943)
Loss per share, total and continuing
Basic (0.10p) (0.21p)
Diluted (0.10p) (0.21p)
The Consolidated statement of comprehensive income above relates to continuing
operations.
Loss and total comprehensive income relate wholly to the owners of the parent
Company.
Consolidated statement of changes in equity
for the year ended 31 December 2025
Share Share Capital Merger Retained
capital premium reserve reserve earnings Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance as at 1 January 2024 9,328 6,587 329 1,250 (7,010) 10,484
Share based payment - - - - - -
Total - transactions with owners - - - -
Profit and total comprehensive income for the period - - - - (1,943) (1,943)
Balance as at 31 December 2024 9,328 6,587 329 1,250 (8,953) 8,541
Share based payment - - - - - -
Total - transactions with owners - - - - - -
Loss and total comprehensive income for the period - - - - (895) (895)
Balance as at 31 December 2025 9,328 6,587 329 1,250 (9,848) 7,646
The merger reserve arose from a business combination in 2017.
Consolidated balance sheet
at 31 December 2025
2025 2024
Notes £'000 £'000
Assets
Non-current assets
Property, plant, and equipment 632 701
Right-of-use assets 490 794
Intangible assets 5,423 5,423
6,545 6,918
Current assets
Inventories 2,193 2,969
Trade and other receivables 2,090 2,156
Cash at bank and in hand 813 195
5,096 5,320
Total assets 11,641 12,238
Equity and liabilities
Equity attributable to equity holders of the parent company
Share capital 9,328 9,328
Share premium account 6,587 6,587
Capital reserve 329 329
Merger reserve 1,250 1,250
Retained earnings (9,848) (8,953)
Total equity 7,646 8,541
Non-current liabilities
Borrowings 5 - 150
Dilapidation provision 270 165
Lease liability 291 547
561 862
Current liabilities
Trade and other payables 6 2,804 1,603
Accruals 256 689
Borrowings 5 150 352
Lease liability 224 191
3,434 2,835
Total liabilities 3,995 3,697
Total equity and liabilities 11,641 12,238
The accompanying accounting policies and notes form part of the financial
statements.
Consolidated cash flow statement
for the year ended 31 December 2025
2025 2024
£'000 £'000
Cash flows from operating activities
Loss after tax for the year (895) (1,943)
Adjustments for:
Taxation (49) (107)
Finance costs 66 99
Depreciation of property, plant and equipment 226 265
Amortisation and impairment of intangible assets 4 166 1,374
Depreciation Right-of-Use assets 266 213
Share-based payment charge - -
Foreign exchange (3) (18)
Decrease/(Increase) in inventories 776 (115)
Decrease/(Increase) in trade and other receivables 66 (133)
(Decrease)/Increase in payables and lease liabilities (33) 283
Net cash generated from operations 586 (82)
Taxation received 49 107
Interest paid (66) (99)
Net cash (used in) / generated from operating activities 569 (74)
Cash flows from investing activities
Payments to acquire property, plant and equipment (61) (67)
Development cost additions 4 (166) (268)
Net cash used in investing activities (227) (335)
Repayment of CBILS 5 (352) (353)
Drawdown on invoice financing facility 5 936 -
Repayment of lease liabilities (313) (273)
Net cash used in financing activities (271) (626)
Net decrease in cash and cash equivalents 615 (1,035)
Cash and cash equivalents at beginning of year 195 1,212
Effective exchange rate fluctuations on cash held 3 18
Cash and cash equivalents at end of year 813 195
Notes to the consolidated financial statements
1. Group accounting policies under IFRS
(a) Basis of preparation
Surgical Innovations Group PLC (the "Company") is a public AIM listed company
incorporated, domiciled and registered in England in the UK. The registered
number is 02298163 and the registered address is Clayton Wood House, 6 Clayton
Wood Bank, Leeds, LS16 6QZ.
The consolidated financial statements have been prepared in accordance with
UK-adopted international accounting standards and with the requirements of the
Companies Act 2006 and as applicable to companies reporting under IFRS. The
preparation of financial statements in conformity with IFRS requires the use
of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the Group's accounting
policies. The financial statements have been prepared under the historical
cost convention, are presented in Sterling and are rounded to the nearest
thousand.
Going concern
The Directors continue to adopt the going concern basis in the preparation of
the financial statements.
The Directors have prepared forecasts for the period to April 2027 based on a
full evaluation of the Group's trading activities and costs base, sensitised
to reflect a rational judgement of the level of inherent risk.
The Board is satisfied that there is headroom including testing any
sensitivities under reasonably possible scenarios, and the Directors conclude
that it continues to be appropriate to prepare the Annual Report and Accounts
on a going concern basis.
2. Segmental reporting
Information reported to the Board, as Chief Operating Decision Makers, and for
the purpose of assessing performance and making investment decisions is
organised into three operating segments. The Group's operating segments under
IFRS 8 are as follows:
SI Brand - the research, development, manufacture and distribution of SI Branded
minimally invasive devices.
OEM - the research, development, manufacture and distribution of minimally invasive
devices for third party medical device companies through either own label or
co-branding. As well as Precision Engineering, the research, development,
manufacture and sale of minimally invasive technology products for precision
engineering applications.
Distribution _ Distribution of specialist medical products sold through Elemental Healthcare
Ltd.
The measure of profit or loss for each reportable segment is gross margin less
amortisation of product development costs. Assets and working capital are
monitored on a Group basis, with no separate disclosure of asset by segment
made in the management accounts, and hence no separate asset disclosure is
provided here. The following segmental analysis has been produced to provide a
reconciliation between the information used by the chief operating decision
maker within the business and the information as it is presented under IFRS
SI Brand Distribution OEM Total*
£'000
£'000
Year ended 31 December 2025 £'000 £'000
Revenue 5,891 4,054 1,657 11,602
Expenses (5,096) (2,134) (1,480) (8,710)
Segment result 795 1,920 177 2,892
Unallocated expenses (3,770)
Other Income -
Loss from operations (878)
Finance income -
Finance costs (66)
Loss before taxation (944)
Tax credit 49
Loss for the year (895)
*There were no revenues transactions between the segments during the year.
Included within the segment results are the following significant non-cash
items:
cash items:
SI Brand Distribution OEM Total
Year ended 31 December 2025 £'000 £'000 £'000 £'000
Amortisation of intangible assets 16 - - 16
Impairment of intangible assets 150 - - 150
Unallocated expenses for 2025 include sales and marketing costs (£504,000),
research and development costs (£1,263,000), central overheads (£1,230,000),
Direct (Elemental Healthcare) sales & marketing overheads (£773,000),
share based payments (£nil) and Other expensed/Non-recurring (£nil).
SI Brand Distribution OEM Total* £'000
£'000
Year ended 31 December 2024 £'000 £'000
Revenue 6,373 3,625 1,947 11,945
Expenses (5,765) (2,171) (1,786) (9,722)
Segment result 608 1,454 161 2,223
Unallocated expenses (4,173)
Other income -
(Loss) from operations (1,950)
Finance income -
Finance costs (99)
(Loss) before taxation (2,049)
Tax charge 107
(Loss) for the year (1,943)
*There were no revenues transactions between the segments during the year.
Included within the segment results are the following significant non-cash
items:
SI Brand Distribution OEM Total
Year ended 31 December 2024 £'000 £'000 £'000 £'000
Amortisation of intangible assets 214 - - 214
Impairment of intangible assets 1,160 - - 1,160
Unallocated expenses for 2024 include sales and marketing costs (£664,000),
research and development costs (£1,149,000), central overheads (£1,298,000),
Direct (Elemental Healthcare) sales & marketing overheads (£909,000),
share based payments (£nil) and Other expensed/Non-recurring (£153,000).
Disaggregation of revenue
The Group has disaggregated revenues in the following table:
Year ended 31 December 2025 SI Brand Distribution OEM Total
£'000 £'000 £'000 £'000
United Kingdom 1,604 4,054 1,291 6,949
Europe 2,082 - - 2,082
US 793 - 366 1,159
APAC(1) 969 - - 969
Rest of World 443 - - 443
Total 5,891 4,054 1,657 11,602
Year ended 31 December 2024 SI Brand Distribution OEM Total
£'000 £'000 £'000 £'000
United Kingdom 1,998 3,625 1,779 7,402
Europe 1,726 - - 1,726
US 957 - 168 1,125
APAC(1) 1,158 - - 1,158
Rest of World 534 - - 534
Total 6,373 3,625 1,947 11,945
1. APAC-Asia Pacific
Revenues are allocated geographically on the basis of where revenues were
received from and not from the ultimate final destination of use. During 2025
£1,284,000 (11.0%) of the Group's revenue depended on one distributor in the
OEM segment (2024: £1,788,000 (15.0%)), and £783,000 (7.0%) in the SI Brand
segment (2024: £840,000 (7.0%)).
Sales of goods were £11,602,000 (2024: £11,945,000) and sales relating to
services in the UK were £Nil (2024: £Nil).
3. Operating loss
The operating loss for the year is stated after charging/(crediting):
2025 2024
£'000 £'000
Depreciation of owned assets 226 265
Amortisation of capitalised development costs 166 214
Depreciation of Right-of-use assets 266 213
Research expenses 1,263 1,149
Foreign exchange losses (3) (18)
Auditor's remuneration:
- fees payable to the Company's auditor for the audit of the Company's annual 70 54
financial statements
Other expensed items - non-recurring costs - 153
Other expensed items
These are expenses or a group of expenses that are considered non-recurring in
nature, as determined by the Directors. They are believed to warrant separate
identification in the financial statements to provide readers with a clear
understanding of the underlying trading performance of the business.
Non-recurring costs
Severance costs related to restructuring activities in 2024 of £153,000.
Other operating expenses comprised:
2025
2024
£'000 £'000
Sales & marketing 504 664
Direct (Elemental Healthcare) sales & marketing overheads 773 909
Administrative expenses 1,225 1,138
Research expenses 1,263 1,149
Other expensed items- nonrecurring - 153
Share based payments - -
Amortisation 166 214
Total 3,931 4,227
4. Intangible assets
Single use product knowledge transfer
Capitalised development costs Exclusive Supplier Agreements
Goodwill Total
£'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2024 14,970 225 8,180 1,799 25,174
Additions 268 - - - 268
At 1 January 2025 15,238 225 8,180 1,799 25,442
Additions 166 - - - 166
At 31 December 2025 15,404 225 8,180 1,799 25,608
Accumulated amortisation and impairment
At 1 January 2024 (13,864) (225) (2,757) (1,799) (18,645)
Charge for the year (214) - - - (214)
Impairment loss (1,160) - - - (1,160)
At 1 January 2025 (15,238) (225) (2757) (1,799) (20,019)
Charge for the year (16) - - - (16)
Impairment loss (150) - - - (150)
At 31 December 2025 (15,404) (225) (2757) (1,799) (20,185)
Carrying amount
At 31 December 2025 - - 5,423 - 5,423
At 31 December 2024 - - 5,423 - 5,423
Goodwill and intangibles are allocated to the cash generating unit (CGU) that
is expected to benefit from the use of the asset.
Capitalised development costs
Capitalised development costs represent expenditure incurred in developing new
products that fulfil the requirements met for capitalisation as set out in
paragraph 57 of IAS38. These costs are amortised over the future commercial
life of the product, commencing on the sale of the first commercial item, up
to a maximum product life cycle of ten years, and taking account of expected
market conditions and penetration.
Goodwill
The Group tests goodwill at each reporting date for impairment and whenever
events or changes in circumstances indicate that the carrying value may not be
recoverable. The recoverable amount of a cash generating unit (CGU) is
determined based on value in use calculations. These calculations use cash
flow projections based on five-year financial budgets approved by management.
Cash flows beyond the five-year period are extrapolated using estimated long
term growth rates.
An impairment review is carried out annually for goodwill. Goodwill arose on
the acquisition of Elemental Healthcare Limited in 2017 and is related to both
the Distribution and SI Brand segments of the Group. Elemental Healthcare
Limited is considered to be a separate cash-generating unit (CGU) of the Group
whose recoverable amount has been calculated on a value in use basis by
reference to discounted future cash flows over a five-year period plus a
terminal value. Principal assumptions underlying this calculation are the
growth rate into perpetuity of 2.5% and a pre-tax discount rate of 17%
(2024:18%) applied to anticipated cash flows. In addition, the value in use
calculation assumes a gross profit margin of 45% increasing to 47% over the
5-year period using past experience of sales made and future sales that were
expected at the reporting date based on anticipated market conditions.
The Group has conducted a sensitivity analysis on the impairment test of the
CGU. Assuming no change to other assumptions, the discount rate can increase
by 15% before an impairment would result.
Impairment losses in the year
During the year, as a result of losses in the Surgical Innovations Limited
cash generating unit ('CGU'), the group carried out a review of the
recoverable amount of the assets in this CGU. This CGU comprises the SI Brand
and OEM segments. Based on the results of the CGU impairment assessment which
has been undertaken using a value in use model, an impairment loss in respect
of the capitalised development costs of £0.15m (2024: £1.16m) was
recognised. The other assets in scope of the impairment assessment, being the
property plant and equipment, were concluded to have a fair value less cost of
disposal in excess of the carrying value and no impairment in respect of these
assets has been recognised. Principal assumptions underlying this calculation
are the growth rate into perpetuity of 2.5% and a pre-tax discount rate of 17%
applied to anticipated cash flows. In addition, the value in use calculation
assumes a gross profit margin of 21% increasing to 26% over the 5 year period
using past experience of sales made and future sales that were expected at the
reporting date based on anticipated market conditions.
5. Borrowings
2025 2024
Bank Loan £'000 £'000
Current liabilities 150 352
Non-current liabilities - 150
Lease liabilities
Current liabilities 224 191
Non-current liabilities 291 547
Total 665 1,240
Borrowings include the following:
· CBILS repayable in May 2026. Interest is calculated at rate of 2.94%
repayable monthly over the Bank of England base rate.
· Covenants attached to the CBILS comprise of EBITDA to debt
servicing costs at a minimum of 1.25x.
· Invoice Discounting facility of £1.0m across the Group. 2.5% on
margin with a maximum of nominal administration fee of a maximum of £0.018m
if not utilised.
· In March 2024, the bank extended its support by resetting the testing
parameters. They excluded 31 March 2024 and initiated the rolling test from
June 2024, based on EBITDA being 1x the debt service. Subsequent testing
periods included September 2024 (1x, on a 6-month rolling basis), December
2024 (1.25x, on a 9-month rolling basis), and then on a 12-month rolling basis
thereafter.
Non-current loans and borrowings Current loans and borrowings
£'000 £'000 Total
Changes in liabilities arising from financing activities £'000
At 1 January 2024 502 353 855
Cash flows for repayment of CBILS - (353) (353)
Transfer between non-current and current (352) 352 -
Interest paid in the period - (59) (59)
Interest accrued in the period - 59 59
At 31 December 2024 150 352 502
Cash flows for repayment of CBILS - (352) (352)
Transfer between non-current and current (150) 150 -
Interest paid in the period - (28) (28)
Interest accrued in the period - 28 28
At 31 December 2025 - 150 150
6. Trade and other payables 2025 2024
£'000
£'000
Trade payables 1,416 1,137
Other tax and social security 152 193
Other payables 298 238
Invoice financing 938 35
Total 2,804 1,603
The Group and Company's financial liabilities have contractual maturities
(including interest payments where applicable) which are summarised below.
Amounts due in Amounts due in Amounts due in
less than 1 year 2-5 years 5-10 years Total financial liabilities
As at 31 December 2025 £'000 £'000
£'000 £'000
Trade payables 1,416 - - 1,416
Invoice financing facility 938 - - 938
Bank borrowings-Current 150 - - 150
Bank borrowings-Non-current - - - -
Total 2,504 - - 2,504
Amounts due in Amounts due in Amounts due in
less than 1 year 2-5 years 5-10 years Total financial liabilities
As at 31 December 2024 £'000 £'000
£'000 £'000
Trade payables 1,137 - - 1,137
Other payables 238 - - 238
Bank borrowings-Current 352 - - 352
Bank borrowings-Non-current - 150 - 150
Total 1,727 150 - 1,877
15. Share capital
2025 2024
£'000 £'000
Authorised, allotted, called up and fully paid 932,816,177 ordinary shares of
1p each (2024: 932,816,177)
9,328 9,328
Shares in issue reconciliation:
2025 2024
Opening no of shares in issue 932,816,177 932,816,177
Issued in satisfaction of share options exercised - -
Closing number of shares in issue 932,816,177 932,816,177
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Copyright 2019 Regulatory News Service, all rights reservedRecent news on Surgical Innovations
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