REG - Xeros Tech Grp plc - Trading Update

Xeros TechnologyAnnouncement

31/03/2022 07:01

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RNS Number : 6558G  Xeros Technology Group plc  31 March 2022

The information contained within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU No.
596/2014) which is part of UK law by virtue of the European Union (withdrawal)
Act 2018.

 

31(st) March 2022

 

Xeros Technology Group plc

 

Trading Update

 

Xeros Technology Group plc (AIM: XSG, 'the Group', 'the Company', 'Xeros'),
the licensor of proprietary solutions improving the sustainability and
economics of the world's clothing and fabrics, today publishes the following
update regarding the commercialisation of its platform technologies.

 

In the 27 January 2022 business update the Group referenced positive progress
on a number of fronts with the Group's development partners and licensees,
notwithstanding the ongoing impact of the Covid pandemic in their various home
territories. Since that update, India has come out of its 3(rd) wave and is
operating near normal but China has been experiencing a significant increase
in major lockdowns. The Board is continuously reviewing the Group's forward
projections in light of these uncertain circumstances. Whilst the Board's view
of the overall prospects of the Group remains unchanged, the Board has come to
the view that the Group is no longer likely to reach month on month EBITDA
profitability and cash breakeven in the first quarter of 2023, as previously
guided. The Board now expects this to be reached in 2024.

 

As at 28(th) February the Group's cash balance was £6.2m. These funds are
sufficient to fund the delivery of major growth milestones through the
remainder of 2022 and into the first quarter of 2023. The Board is actively
evaluating several funding options to secure the remaining investment
required.

Since the January business update, commercial discussions with major
international organisations for the licensing of the XFiltra filtration
technology have progressed in line with expectations and the Company is
currently in detailed commercial negotiations which it expects to conclude in
the near term. The Group continues to see increasing levels of commercial
interest in XFiltra as a result of the combined impetus of legislative
developments for microfibre filtration devices in washing machines and growing
consumer awareness of the microfibre pollution issue. The Group expects to
receive XFiltra revenues from late 2023 onwards.

Also, since the January business update, Xeros' senior management team has
travelled to India and Bangladesh to review the progress and growth plans of
both IFB and Ramsons. Both license partners stated strong prospects for
increasing orders in commercial laundry and denim finishing applications
respectively.

Having launched in commercial laundry, IFB and Xeros senior management teams
have reviewed and agreed detailed plans for consumer acceptance field trials
of their Xeros enabled domestic washing machines, which are due to commence in
April. Market entry for these washing machines is planned to be early Q3. IFB
continue to show a high degree of commitment towards a successful launch.

In the denim finishing market, supported on the ground by Ramsons and Xeros,
Aba continues to work on completing machine cycles for a leading global denim
brand as previously communicated. This has extended beyond the February date,
as previously advised, pending Xeros' physical support which is now being
provided in Dhaka. In addition to this work Ramsons has recently sold Xeros
XDrum machines to a further three denim manufacturers in Bangladesh. These
manufacturers also produce denim jeans for globally recognised brands. During
the course of this year, the Group expects to be able to announce endorsements
from major denim brands about the benefits of the Xeros technology in terms of
pumice replacement and water and energy savings. Xeros' ambition remains the
full elimination of the use of pumice stone from the denim finishing process.

In comparison with the progress made in India, the continuing lockdowns noted
above in China have reduced significantly SeaLion's ability to commercialise
our commercial laundry technology.

The Group will publish 2021 financial results at a later date and, as usual,
this date will be communicated in advance.

 

Mark Nichols, Chief Executive of Xeros, said:

 

 

"Since our update in January, with the exception of China, the levels of
activity by our existing partners have continued to be strong as has our
engagement with prospective licensees. Our expectations are that multiple
agreements will be signed this year with some fairly near term.  This is
against a background of increasing levels of interest from global brands in
our ability to help them meet their major global environmental imperatives."

 

 

Enquiries:

 

 Xeros Technology Group plc                       Tel: 0114 321 6328

 Mark Nichols, Chief Executive Officer

 Paul Denney, Chief Financial Officer

 finnCap Limited (Nominated Adviser and Broker)   Tel: 020 7220 0570

 Julian Blunt/Teddy Whiley, Corporate Finance

 Andrew Burdis/Sunila de Silva, ECM

Notes to Editors

 

With close to 40 patent families, Xeros' revolutionary platform technologies,
XTend™ and XFiltra™ set new standards for performance and sustainability
across our clothing's lifecycle. By reducing the consumption of valuable
natural resources and preventing microfibre and microplastic pollution,
Xeros greatly reduces the impact of our clothes on the planet.

Backed by science, we set new standards for significantly reduced water
consumption, lower carbon and effluent emissions, and improved garment
care/life at the manufacturing stage and throughout laundry processes, in
industry, and in the home. Xeros' technologies deliver a unique combination
of unbeatable sustainability outcomes, improving performance whilst reducing
costs.

The manufacture of clothes and their subsequent care consumes vast amounts of
our finite, valuable resources. Xeros licenses new technologies to enable us
all to consume less, helping to protect the world for our future.

For more information, please visit - http://www.xerostech.com/
(http://www.xerostech.com/)

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