REG - Thruvision Group PLC - Interim Results
19/12/2022 07:00
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RNS Number : 0747K Thruvision Group PLC 19 December 2022
19 December 2022
Thruvision Group plc
("Thruvision" or the "Group")
Interim Results for the six months ended 30 September 2022
Thruvision Group plc (AIM: THRU), the specialist provider of 'safe distance'
people-screening technology to the international security market, announces
unaudited results for the six months ended 30 September 2022 (the first half
of the Group's 2023 financial year - H1 2023).
Key Highlights
· Revenue was up 41% to £2.8 million (H1 2022: £2.0 million).
· Two strategically important and larger than anticipated orders received from
US Customs and Border Protection (CBP) worth £8.7 million(1) ($9.7 million).
· Despite challenging economic conditions for retailers, Profit Protection
product revenue for H1 was unchanged at £1.0 million (H1 2022: £1.0 million)
with good order intake since 1 October from a combination of existing and new
customers.
· The Group's operating loss was £1.9 million (H1 2022: loss of £2.0 million)
and gross margin was 49% (H1 2022: 49%). The Group's Adjusted EBITDA(2) loss
was £1.6 million (H1 2022: loss of £1.6 million).
· The Group is currently on track to achieve its objective of breaking even at
Adjusted EBITDA this financial year for the first time.
· Cash balance as at 30 September 2022 was £1.1 million (31 March 2022: £5.4
million), with cash at 15 December 2022 of £4.3 million.
(1) ( )CBP US$ orders have been translated at the 30 September $:£ closing
exchange rate of 1.12 throughout this announcement.
H1 2023 H1 2022
Continuing operations Unaudited Unaudited
£m
£m
Change
Statutory measures:
Revenue 2.8 2.0 +41%
Gross profit 1.4 1.0 +41%
Gross margin 49% 49% -
Operating loss (1.9) (2.0) +6%
Loss before tax (1.9) (2.0) +5%
Alternative measures:
Adjusted overheads(2) (3.2) (2.8) (13%)
Adjusted EBITDA(2) (1.6) (1.6) +1%
Adjusted loss before tax(2) (1.8) (1.9) +1%
(2) Alternative performance measures ('APMs') are used consistently
throughout this announcement and are referred to as 'adjusted'. These are
defined in full and reconciled to the reported statutory measures in the
Appendix.
Commenting on the results, Colin Evans, Chief Executive of Thruvision, said:
"With our unique offering and the traction we have gained in our two core
markets, Customs and Profit Protection, we expect to deliver strong growth and
achieve our objective of breaking even this financial year. With over 100 of
our highest-performance cameras being deployed by US Customs and Border
Protection (CBP) over the coming months and with a multi-year purchasing
framework now in place, we expect further growth with this key customer over
the coming years as it starts a full rollout of our technology. This
significant opportunity, together with demand from other customs agencies and
our growing base of Profit Protection customers should give us a profitable
revenue base from which we can now build the Group."
For further information please contact:
Thruvision Group
plc
+44 (0)12 3542 5400
Tom Black, Chairman
Colin Evans, Chief Executive
Victoria Balchin, Chief Financial Officer
Investec Bank
plc
+44 (0)20 7597 5970
Patrick Robb / James Rudd / Sebastian Lawrence
FTI Consulting
LLP
+44 (0)20 3727 1000
Matt Dixon / Tom Blundell / Jemima Gurney
About Thruvision
Thruvision is the leading provider of safe distance, people security screening
technology. Using patented passive terahertz technology, Thruvision is
uniquely capable of detecting metallic and non-metallic threats including
weapons, explosives and contraband items that are hidden under clothing, at
distances between 3m and 10m. Addressing the growing need for safe, fast and
effective security, Thruvision completely removes the need for physical
"pat-downs" and has been vetted and approved by the US Transportation Security
Administration for surface transportation. Operationally deployed in 20
countries around the world, Thruvision is used for aviation and transportation
security, retail supply chain loss prevention, facilities and public area
protection and customs and border control. The company has offices near Oxford
and Washington DC. www.thruvision.com
Important information
This announcement may include statements that are, or may be deemed to be,
"forward-looking statements" (including words such as "believe", "expect",
"estimate", "intend", "anticipate" and words of similar meaning). By their
nature, forward-looking statements involve risk and uncertainty since they
relate to future events and circumstances, and actual results may, and often
do, differ materially from any forward-looking statements. Any forward-looking
statements in this announcement reflect management's view with respect to
future events as at the date of this announcement. Save as required by
applicable law, the Company undertakes no obligation to publicly revise any
forward-looking statements in this announcement, whether following any change
in its expectations or to reflect events or circumstances after the date of
this announcement.
Chairman's Statement
The Group saw trading momentum build through the period, despite a worsening
economic backdrop, culminating in the receipt of two strategically important
orders from US Customs and Border Protection (CBP), via our US Government
contracting partner, totalling £8.7 million ($9.7 million). Revenue for the
period was £2.8 million, representing growth of 41% versus the comparable
period last year (H1 2022: £2.0 million), with our Customs and Profit
Protection markets accounting for almost the entirety of this figure. In
October, on receipt of the second order from CBP, CBP order backlog stood at
£7.4 million ($8.3 million), and further non-CBP orders totalling £1.3
million have been received since. We expect to deliver most, if not all, of
this order backlog during the second half of the financial year.
Customs
After successful pilot deployments in the summer of 2021, the two CBP awards
are an important milestone in the Group's strategic development. Once
delivered, CBP will have deployed over 100 of our latest, high-performance
cameras at land border crossings and international airports where they will be
used to check travellers for contraband. One of the awards was made as the
first purchase under a framework purchasing agreement that CBP put in place
during the period. This agreement provides the mechanism through which CBP can
fulfil its publicly stated intention, as reported in our April 2022 update, to
acquire significant further "passive body scanners" in the period to September
2026.
Strategic adoption by CBP clearly assists our broader sales efforts with other
international Customs agencies. We received an order for a sixth tranche of
cameras from an existing Asian Customs agency customer in November and we have
several live opportunities with other agencies where we expect to see progress
in 2023.
Profit Protection
Almost all retail organisations we speak to report a rising level of employee
theft, potentially connected to the rapidly increasing cost of living being
felt in most global markets. Therefore, while the economic situation has
become increasingly challenging for our Profit Protection customers, we have
seen an encouraging take-up of our new "WalkTHRU" screening lane solution
which we pioneered with Next and for which we recently won a retail industry
award. This solution comprises two cameras along with our AI algorithm to
significantly increase the throughput rate. This allows 100% of employees to
be screened quickly and effectively thereby maximizing deterrence and
delivering a strong return on investment, with one major UK retailer
calculating a payback within six months of deploying Thruvision products.
Given employee theft is increasingly problematic and with a growing list of
flagship customers addressing the problem with our solution, we remain
confident that a combination of existing customers buying more, and new
retailers / third party logistics (3PL) companies signing up will allow us to
maintain our performance in this market in the short term and return to growth
as economic conditions recover.
People
I am delighted to welcome Victoria Balchin, our new Chief Financial Officer,
who started with us in October 2022. Victoria brings significant relevant
experience to the Group. She qualified as a chartered accountant with PwC and
has held a number of finance roles with British Sky Broadcasting Group plc,
SABMiller plc, Spectris plc and Brüel & Kjær Vibro, a Spectris business
headquartered in Germany. Victoria's appointment means that two of the five
members of the Board are now female.
After 12 years of service with the Group our Company Secretary, John
Woollhead, informed the board of his intention to retire at the end of
December. John has been a first-class and trusted colleague for almost 20
years, and we will greatly miss his wise counsel and good humour. John will be
replaced by Hannah Platt, a chartered accountant who qualified with EY and who
has held a range of commercial and company secretarial positions.
Outlook
The Group is entering a new phase in its development. With the strategically
significant purchasing framework with CBP now in place and a material order
backlog built for our second half, we expect to deliver strong growth and
achieve our objective of breaking even this financial year.
Looking forward, the growing interest across our key markets together with the
enthusiasm with which our latest products have been received by customers,
gives us confidence that profitable revenue growth will continue beyond the
current period.
Strategic Update
Thruvision technology addresses the growing international need to screen
individuals for weapons, contraband or other illicit items that might be
concealed in their clothing. By operating at a distance of around 3 metres
from the person being screened, Thruvision cameras are a very fast, flexible
and effective way of detecting non-metallic items in particular. Unlike
airport body scanners, Thruvision allows a security guard to see the concealed
item, meaning the need to physically touch the individual being screened is
removed.
These important competitive differentiators mean that Thruvision has achieved
critical mass in our two key markets - Customs and Profit Protection, where we
help reduce theft from retail warehouses. In both markets, items being
concealed are almost always non-metallic - typically drugs and cash in
Customs, and a wide range of fashion, tobacco, alcohol, beauty and electronic
products in Retail. This means metal detectors (either walk-through or
handheld) do not work at all, and airport body scanners are simply too slow
and cumbersome to be effective in the very busy border control and retail
warehouse markets.
Given our growing, well-known "flagship" customer base in both markets, we are
now firmly established as a mainstream solution, and we will continue to
proactively invest in further sales resource to drive growth. We remain
engaged in the Aviation market and in Entrance Screening but expect to see
only modest revenue in these markets in the short to medium term.
Business Review
Customs
As announced on 22 September and 5 October 2022, we received two strategically
important orders from US Customs and Border Protection (CBP), via our US
Government contracting partner, totalling £8.7 million ($9.7 million) in
September 2022. The first of these orders, totalling £2.4 million ($2.7
million), was to complete the process of upgrading CBP's existing fleet of 60
cameras to our latest high definition 16-channel variant. Half of this first
order was delivered in H1 with the balance to be delivered in H2.
The second order, for £6.3 million ($7.0 million), was the first to be
received under a new framework purchasing agreement which can, in principle,
allow CBP to place additional orders for a further four years up to the end of
September 2026. This order further expands the CBP fleet of Thruvision
equipment and is expected to broaden operational deployments into major US
international airports for the first time. The order size is larger than we
had originally expected for FY23.
Our April 2022 trading update stated that CBP had made public its intentions
to acquire significant numbers of additional "passive body scanners" during
2022 and beyond. The framework purchasing agreement provides a mechanism
through which CBP can execute this intention. In this context, it is worth
noting that in total, Thruvision received orders worth
£12.5 million ($14.0 million) from CBP in the US Government's last financial
year (1 October 2021 to 30 September 2022).
Other orders received in this second half include an order from an existing
Asian Customs agency customer for a sixth tranche of cameras to be delivered
in the second half. We successfully beat Chinese competition to this award. We
continue to engage with several other international Customs agencies (some
existing customers, others new) who are interested in acquiring Thruvision
products for contraband detection.
Profit Protection
The economic situation has become increasingly challenging for retailers as
the year has progressed and has resulted in our Profit Protection product
revenue for H1 being unchanged at £1.0 million (H1 2022: £1.0 million).
Encouragingly however, existing Profit Protection customers have continued to
expand and upgrade their Thruvision fleets. This is because they now fully
understand the in-year return on investment that can be achieved by deploying
our technology. As discussed in the Chairman's Statement, we are seeing strong
interest in our latest "WalkTHRU" lane which we have now sold to existing
customers, Next and JD Sports in the UK, and a new customer in the US, Saks
Fifth Avenue.
Our focus on Third-Party Logistics providers (3PLs) which operate significant
numbers of distribution centres has also delivered further success. In
addition to CEVA, we have signed a global supply framework agreement with a
second major global 3PL, which is headquartered in Germany. We have delivered
a WalkTHRU solution to one of this 3PL's high profile sites in the UK and are
discussing further deployments over the next few months with them.
Aviation
While our solutions can be used for employee security screening in airports in
the US, passenger security screening is highly regulated and requires
accreditation. We started this process with the US Transportation Security
Administration (TSA) before the pandemic and, after significant delays,
testing has now recommenced. Such accreditation would enable the use of our
solutions for passenger security screening in US airports. We are seeing
modest renewed demand from US airports for employee security screening.
Entrance Security
Our key differentiator in this market is the ability to process high visitor
throughput rates and reliably detect mass casualty threats such as military
assault rifles and person-borne bomb vests. We are seeing modest renewed
interest, principally from the Middle East although this is unlikely to become
a reliable revenue stream for the business.
Product Range
We are delighted with the uptake of our AI detection algorithm, which is
branded "Dynamic Detection". This has been included in the latest cameras
provided to CBP for Customs applications, and it is enhancing the operational
performance on our new WalkTHRU lane described above. We continue to invest in
further image processing capabilities which we expect to add as software
upgrades to our camera range in calendar 2023, further weighting the value of
our solution towards software rather than purely hardware.
Supply chain
Despite well-documented global supply chain issues, we have worked hard with
our specialist Terahertz component suppliers to maintain surety of supply of
the very specific and even unique components we require. Like others, we have
been fully exposed to global shortages of more mainstream electronics but have
managed this situation effectively by holding higher than normal levels of
inventory to mitigate delivery risk. Our ability to manufacture using our
US-based partner is now proven and is playing a significant role in delivering
the major CBP orders received in September and October of this year.
People
Group headcount remained level at 47 during the period.
Financial review
Summary
Revenue for the six months ended 30 September 2022 was £2.8 million (H1 2022:
£2.0 million; FY 2022: £8.4 million). H1 2023 contained a single large order
from US Customs and Border Protection (CBP) resulting in revenue of £1.3
million in the period which did not occur in H1 2022. Gross margin remained
level with the prior period at 49% (H1 2022: 49%;
FY 2022: 47%).
Operating loss in the period was £1.9 million (H1 2022: loss of £2.0
million; FY 2022: loss of £1.9 million).
Cash as of 30 September 2022 was £1.1 million (31 March 2022: £5.4 million),
with cash at 15 December 2022 of
£4.3 million. The majority of the reduction in cash during H1 relates to
increases in our inventory balance to support delivery of expected orders in
H2 partly driven by targeted additional inventory held for certain components
where lead times were becoming more uncertain.
Revenue
Revenue was £2.8 million in the six months to 30 September 2022 (H1 2022:
£2.0 million, FY 2022: £8.4 million) and has been split between our two
principal activities (product revenue and support and development revenue) as
below:
6 months ended 6 months ended Year ended
30 September
30 September
31 March
2022
2021
2022
£'000 £'000 £'000
Product 2,364 1,622 7,667
Support and Development 407 340 694
Total 2,771 1,962 8,361
The principal growth driver for the business is product sales and, while we
expect to continue to be awarded customer funded development contracts, we do
not expect this to form a material proportion of revenues in the future.
Product revenue is split further by sector below:
6 months ended 6 months ended Year ended
30 September
30 September
31 March
2022
2021
2022
Product revenue by sector £'000 £'000 £'000
Profit Protection 992 982 3,505
Customs 1,370 198 3,404
Aviation - 128 131
Entrance Security 2 314 627
Total 2,364 1,622 7,667
Gross Margin
Gross margin remained level with the comparable period at 49% (H1 2022: 49%,
FY 2022: 47%) and higher than the full year results.
6 months ended 6 months ended Year ended
30 September
30 September
31 March
2022
2021
2022
£'000 £'000 £'000
Revenue 2,771 1,962 8,361
Gross Profit 1,356 961 3,902
Gross margin % 49% 49% 47%
Financial review (continued)
Administrative expenses
We continue to invest in sales and marketing activities relating to Profit
Protection in the US, whilst further investing in our engineering,
manufacturing capability and software development. Administrative expenses
increased by 9% to £3.2 million with adjusted overheads up by 13% to £3.2
million compared to the prior period. Administrative expenses include
share-based payment charges, but these are excluded from adjusted overheads.
Adjusted overheads as a proportion of sales were 115% (H1 2022: 144%; FY 2022:
74%) reflecting the growth and phasing of revenue and continued tight control
of overheads.
Sales and marketing expenditure increased by £82k with additional headcount
and travel to support growth in our European and US Profit Protection markets.
Engineering costs, include Manufacturing and R&D costs, increased by
£146k as a result of increased headcount in our software team as we look to
scale up and increase our product offerings going forward.
Management and PLC costs increased driven by one-off costs relating to the CFO
replacement, higher insurance costs and professional fees.
Adjusted overheads are analysed as follows:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2022 2021 2022
£'000 £'000 £'000
Engineering 902 756 1,690
Sales and marketing 1,065 983 2,006
Property and administration 209 224 502
Management 597 338 708
PLC costs 354 240 693
Depreciation and amortisation 268 285 561
Foreign exchange (gains) / losses (203) 1 (6)
Adjusted overheads* 3,192 2,827 6,154
* Alternative performance measures ('APMs') are used consistently throughout
this report and are referred to as 'adjusted'. These are defined in full and
reconciled to the reported statutory measures in the Appendix.
Loss from continuing operations
The loss from continuing operations in the period was £1.9 million (H1 2022:
loss of £1.9 million; FY 2022: loss of
£1.7 million). Adjusted loss before tax was £1.8 million (H1 2022: £1.9
million; FY 2022: loss of £2.3 million).
Balance sheet
Cash and cash equivalents at 30 September 2022 were £1.1 million (H1 2022:
£4.1 million, FY 2022: £5.4 million), with the principal impacts in the
period being the loss recorded of £1.8 million as well as the £2.7 million
net working capital outflow as set out in the cashflow statement on page 12.
Movements in working capital were as follows:
· Trade and other receivables increased, driven by the timing of sales,
resulting in a £1.8 million outflow in the half year. Included in trade and
other receivables of £3.8m at 30 September 2022 was £2.4 million relating to
CBP, the cash for which was received during October and November.
· Increased inventory to support expected orders in H2 FY 2023 as well as
forward purchases of key electronic components resulted in a £0.9 million
outflow during in the period.
· £0.3 million decrease in deferred revenue balances, as revenue deferred as at
31 March 2022 was recognised as income during the period.
· An increase in trade and other payables resulted in an inflow of £0.3
million. Trade creditors increased due to the timing of stock purchases in the
period.
Other
It is intended that a limited programme of share purchases by the Thruvision
plc EBT will be undertaken over the next 12 months with the purpose of partly
satisfying future employee exercises of share options.
Consolidated income statement
6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March
2022
Unaudited Unaudited Audited
Note £'000 £'000 £'000
Revenue 2 2,771 1,962 8,361
Cost of sales (1,415) (1,001) (4,459)
Gross profit 1,356 961 3,902
Administrative expenses (3,243) (2,965) (5,788)
Operating loss (1,887) (2,004) (1,886)
Finance revenue 11 10 17
Finance costs (16) (7) (20)
Loss before tax (1,892) (2,001) (1,889)
Income tax 89 87 231
Loss for the period from continuing operations (1,803) (1,914) (1,658)
Discontinued operations
Loss from discontinued operation (net of tax) - (33) -
Loss for the period (1,803) (1,947) (1,658)
Basic and diluted loss per share - continuing operations 3 (1.23p) (1.31p) (1.14p)
Consolidated statement of comprehensive income
6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Loss for the period from continuing operations (1,803) (1,914) (1,658)
Loss for the period from discontinued operations - (33) -
Loss for the period attributable to owners of the parent (1,803) (1,947) (1,658)
Other comprehensive income/(expense) from continuing operations
Other comprehensive income that may be
subsequently reclassified to profit and loss:
Exchange differences on retranslation (45) 2 (6)
of foreign operations
Total comprehensive loss attributable to owners of the parent (1,848) (1,945) (1,664)
Consolidated statement of financial position
at 30 September 2022
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
Note £'000 £'000 £'000
Assets
Non-current assets
Property, plant and equipment 962 910 1,175
Other intangible assets 140 42 79
1,102 952 1,254
Current assets
Inventories 4,772 5,257 3,868
Trade and other receivables 3,813 1,316 1,982
Current tax recoverable 302 270 210
Cash and cash equivalents 1,091 4,097 5,441
9,978 10,940 11,501
Total assets 11,080 11,892 12,755
Equity and liabilities
Attributable to owners of the parent
Equity share capital 4 1,472 1,458 1,466
Share premium 308 47 201
Capital redemption reserve 163 163 163
Translation reserve 16 69 61
Retained earnings 5,802 7,769 7,554
Total equity 7,761 9,506 9,445
Non-current liabilities
Other payables 518 259 600
Provisions 38 38 38
556 297 638
Current liabilities
Trade and other payables 2,557 1,849 2,494
Provisions 206 240 178
2,763 2,089 2,672
Total liabilities 3,319 2,386 3,310
Total equity and liabilities 11,080 11,892 12,755
Consolidated statement of changes in equity (unaudited)
Ordinary share capital £'000 Share premium £'000 Capital redemption reserve £'000 Translation reserve £'000 Retained earnings £'000 Total equity £'000
At 31 March 2021 1,458 47 163 67 9,578 11,313
Share based payment charge - - - - 138 138
Transactions with shareholders - - - - 138 138
Loss for the period - - - - (1,947) (1,947)
Other comprehensive income - - - 2 - 2
Total comprehensive income/(loss) - - - 2 (1,947) (1,945)
At 30 September 2021 1,458 47 163 69 7,769 9,506
Shares issued 8 154 - - - 162
Share based payment credit - - - - (504) (504)
Transactions with shareholders 8 154 - - (504) (342)
Profit for the period - - - - 289 289
Other comprehensive expense - - - (8) - (8)
Total comprehensive (loss)/income - - - (8) 289 281
At 31 March 2022 1,466 201 163 61 7,554 9,445
Shares issued 6 107 - - - 113
Share based payment charge - - - - 51 51
Transactions with shareholders 6 107 - - 51 164
Loss for the period - - - - (1,803) (1,803)
Other comprehensive loss - - - (45) - (45)
Total comprehensive loss - - - (45) (1,803) (1,848)
At 30 September 2022 1,472 308 163 16 5,802 7,761
Consolidated statement of cash flows
6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Operating activities
Loss for the period (1,803) (1,947) (1,658)
Adjustments:
Depreciation of property, plant and equipment 258 278 546
Amortisation of intangible assets 10 7 15
Share-based payment charge/(credit) 51 138 (366)
Profit on disposal of property, plant & equipment (10) - -
Finance income (10) (10) (17)
Finance costs 16 7 20
Taxation credit (89) (87) (231)
Working capital movements:
(Increase) / decrease in trade and other receivables (1,811) 126 (540)
(Increase) / decrease in inventories (904) (838) 551
Increase / (decrease) in trade and other payables 348 (487) 305
Increase in provisions 28 65 3
Decrease in deferred revenue (322) (460) (683)
Transfer from property, plant and equipment to inventory - 25 70
Cash utilised in operations (4,238) (3,183) (1,985)
Tax received - 197 399
Net cash outflow from operating activities (4,238) (2,986) (1,586)
Investing activities
Purchase of property, plant & equipment (26) (111) (187)
Purchase of intangible assets (70) - (46)
Proceeds from disposal of property, plant and equipment 11 - -
Interest received 10 10 17
Net cash outflow from investing activities (75) (101) (216)
Financing activities
Proceeds from issues of shares 93 - 162
Payments on principal portion of lease liabilities (81) (82) (168)
Interest paid on lease liabilities (4) (7) (13)
Net cash inflow / (outflow) from financing activities 8 (89) (19)
Net decrease in cash and cash equivalents (4,305) (3,176) (1,821)
Cash and cash equivalents at beginning of the period 5,441 7,268 7,268
Effect of foreign exchange rate changes on cash and cash equivalents (45) 5 (6)
Cash and cash equivalents at end of the period 1,091 4,097 5,441
Notes to the financial statements
1. Accounting policies
Basis of preparation
The consolidated interim financial statements include those of Thruvision
Group plc and all of its subsidiary undertakings (together "the Group") drawn
up at 30 September 2022 and have been prepared in accordance with
International Accounting Standard 34, "Interim Financial Reporting" ("IAS 34")
as adopted for use in the European Union ("EU"). The consolidated interim
financial statements have been prepared using accounting policies and methods
of computation consistent with those applied in the consolidated financial
statements for the period ended 31 March 2022.
The Group is a public limited company incorporated and domiciled in England
& Wales and whose shares are quoted on AIM, a market operated by The
London Stock Exchange.
All values are rounded to £'000 except where otherwise stated.
Accounting policies
The annual consolidated financial statements of the Group are prepared on the
basis of International Financial Reporting Standards ("IFRS"). The
consolidated interim financial statements are presented on a condensed basis
as permitted by IAS 34 and therefore do not include all the disclosures that
would otherwise be required in a full set of financial statements and should
be read in conjunction with the most recent Annual Report and Accounts which
were approved by the Board of Directors on 29 September 2022 and have been
filed with Companies House. The condensed interim financial statements do not
constitute statutory accounts as defined in Section 435 of the Companies Act
2006 and are unaudited for all periods presented. The financial information
for the 12-month period ended 31 March 2022 is extracted from the financial
statements for that period. The auditors' report on those financial statements
was unqualified and did not contain an emphasis of matter reference and did
not contain a statement under section 498(2) or (3) of the Companies Act 2006.
The half year results for the current period to 30 September 2022 have not
been audited or reviewed by auditors pursuant to the Auditing Practices Board
guidance of Review of Interim Financial Information.
Adoption of new and revised International Financial Reporting Standards
The Group's accounting policies have been prepared in accordance with IFRS
effective as at its reporting date of
30 September 2022.
Standards Issued
The standards and interpretations that are issued up to the date of issuance
of the Group's interim financial statements are disclosed below. The Group has
adopted these standards, if applicable, when these became effective. Further
details are disclosed in the 31 March 2022 Annual Report available on the
Group's website: www.thruvision.com.
Accounting developments - new standards, amendments and interpretations issued
and adopted
There were no new accounting standards or amendments requiring disclosure in
the period.
Going concern
The Group's loss before tax from continuing operations for the period was
£1.9 million (H1 2022: £2.0 million; FY 2022: £1.9 million). As at 30
September 2022 the Group had net current assets of £7.2 million (30 September
2021: £8.9 million; 31 March 2022: £8.8 million) and net cash reserves of
£1.1 million (30 September 2021: £4.1 million; 31 March 2022: £5.4
million). Additionally cash and cash equivalents were £4.3 million as at 15
December 2022.
The Board has reviewed cash flow forecasts for the period up to and including
31 December 2023. These forecasts and projections take into account reasonably
possible changes in trading performance and show that the Group will be able
to react as required in order to operate within the level of current funding
resources, and no need for the Group to take on any debt. In order to
stress-test the adoption of the going concern basis, a cashflow forecast was
also produced which looked at the highly unlikely scenario in which no further
sales took place and certain discretionary areas of cash expenditure were
reduced. This showed that even under this extreme condition, the Group would
still have positive cash reserves as at 31 December 2023 with no need to take
on external debt. The Directors therefore believe there is sufficient cash
available to the Group to manage through these requirements.
As with all businesses, there are particular times of the year where the
Group's working capital requirements are at their peak. However, the Group is
well placed to manage business risk effectively and the Board reviews the
Group's performance against budgets and forecasts on a regular basis to ensure
action is taken where needed.
The Directors therefore are satisfied that the Group has adequate resources to
continue operating for a period of at least 12 months from the approval of
these accounts. For this reason, they have adopted the going concern basis in
preparing the financial statements.
Notes to the financial statements (continued)
2. Segmental information
The Directors do not split the business into segments in order to internally
analyse the business performance. The Directors believe that allocating
overheads by department provides a suitable level of business insight. The
overhead department cost centres comprise of Engineering (manufacturing and
R&D), sales and marketing, property and administration, Management and PLC
costs, with the split of costs as shown in the Half Year Report on page 7.
Analysis of revenue by customer
There have been two (H1 2022: three, FY 2022: two) individually material
customer(s) (each comprising in excess of 10% of revenue) during the period.
These customers individually represented £1,335k and £415k of revenue (H1
2022: £359k, £206k and £200k, FY 2022: £3,740k and £1,059k).
The Group's revenue by customer's geographical location is detailed below:
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
UK and Europe 990 1,033 3,508
Americas 1,759 693 4,445
Rest of World 22 236 408
2,771 1,962 8,361
The Group's revenue by type is detailed below:
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Revenue recognised at point in time 2,398 1,662 7,718
Revenue recognised over time - extended warranty and support revenue 373 300 643
2,771 1,962 8,361
The Group's non-current assets by geography are detailed below:
As at As at As at
30 September 2022
30 September 2021
31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
UK 1,037 828 1,157
Americas 65 124 97
1,102 952 1,254
Notes to the financial statements (continued)
3. Loss per share
The following reflects the loss and share data used in the basic and diluted
loss per share calculations:
Loss per share 6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Loss from continuing operations attributable to ordinary shareholders (1,803) (1,914) (1,658)
Loss from continuing and discontinued operations attributable to ordinary (1,803) (1,947) (1,658)
shareholders
Weighted average number of shares 147,097,721 145,779,118 145,853,091
Basic and diluted loss per share - continuing operations (1.23p) (1.31p) (1.14p)
Basic and diluted loss per share - continuing and discontinued operations (1.23p) (1.34p) (1.14p)
The inclusion of potential Ordinary Shares arising from Share based payments
(LTIP awards and EMI Options) would be anti-dilutive. Basic and diluted loss
per share has therefore been calculated using the same weighted number of
shares.
4. Issued share capital
As at 30 September 2022, there were 147,165,718 Ordinary Shares in issue (30
September 2021: 145,779,118;
31 March 2022: 146,589,118).
APPENDIX - ALTERNATIVE PERFORMANCE MEASURES
Policy
Thruvision uses adjusted figures as key performance measures in addition to
those reported under IFRS, as management believe these measures enable
management and stakeholders to assess the underlying trading performance of
the businesses as they exclude certain items that are considered to be
significant in nature and/or quantum.
The alternative performance measures ('APMs') are consistent with how the
businesses' performance is planned and reported within the internal management
reporting to the Board. Some of these measures are used for the purpose of
setting remuneration targets.
The key APMs that the Group uses include adjusted measures for the income
statement together with adjusted cash flow measures. Explanations of how they
are calculated and how they are reconciled to an IFRS statutory measure are
set out below.
Adjusted measures
The Group's policy is to exclude items that are considered to be significant
in nature and/or quantum and where treatment as an adjusted item provides
stakeholders with additional useful information to better assess the
period-on-period trading performance of the Group. The Group excludes certain
items, which management have defined for 2023 and 2022 as:
- Share based payments charge or income
Based on the above policy, the adjusted performance measures are derived from
the statutory figures as follows
a) Adjusted overheads
6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Administrative expenses (3,243) (2,965) (5,788)
Add back:
Share-based payment charge/(credit) 51 138 (366)
Adjusted overheads (3,192) (2,827) (6,154)
b) Adjusted EBITDA
6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Statutory operating loss (1,887) (2,004) (1,886)
Add back:
Depreciation and amortisation 268 285 561
Share-based payment charge/(credit) 51 138 (366)
Adjusted EBITDA (1,568) (1,581) (1,691)
c) Adjusted loss before tax
6 months ended 6 months ended Year ended
30 September 2022 30 September 2021 31 March 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Statutory loss before tax (1,892) (2,001) (1,889)
Add back:
Share-based payment charge/(credit) 51 138 (366)
Adjusted loss before tax (1,841) (1,863) (2,255)
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