RM2 International SA Trading Update and New Board Appointments (0609A)

TIDMRM2

RNS Number : 0609A

RM2 International SA

07 September 2018

7 September 2018

RM2 International S.A.

("RM2" or the "Company")

Trading Update and New Board Appointments

RM2 (LSE-AIM: RM2), the sustainable smart pallet innovator (the "Company"), is pleased to announce that it successfully completed a 100-unit trial with one of the world's leaders in the logistics industry, serving both internal and external loops. Other trials with large multi-national corporations are progressing well. In particular, one large trial with a North American beverage customer has concluded with strong results and discussions on deployment terms are expected to continue over the coming months. An ELIoT-enabled pallet is fitted with RM2 proprietary tracking technology which communicates its precise location, allowing misdirected or mishandled goods to be identified immediately, enabling customers to reduce loss, mishandling, spoilage and theft, thereby creating significant cost savings and supply chain efficiencies.

On 13 April 2018, the Company announced a Phase 1 contract with a Fortune 500 customer which is expected to involve a significant deployment of RM2 ELIoT pallets. The initial implementation of RM2 ELIoT pallets under that contract was deferred but the deployment is now underway with promising results.

Current deployment of RM2 ELIoT pallets utilizes CAT-1 technology. However, RM2 sees significant benefit in the transition to CAT-M technology as it comes on-stream due to its lower demand on battery resources and significantly lower-priced components. Global demand for CAT-M components is increasing rapidly and the ability of suppliers to meet all orders may be stretched. RM2 expects to transition to CAT-M as chipsets become available.

With the conversion of trials with large customers into long-term contracts taking longer than anticipated, the Company's expectation of turning EBITDA positive in 2019, as first noted on 9 March 2018, is challenging. The Company will provide further updates on this in due course and in the meantime, continues to implement measures to reduce its cost base.

New Board Appointments

The Company is finalising the nomination process for the appointment of two high calibre board members, further details on which will be announced shortly.

Funding Update

On 29 March 2018, the Company simplified its capital structure and conditionally raised USD36 million through a two tranche placing (the "Placing"). Following the granting of shareholder approval, on 13 April 2018, the Company, inter alia, completed the first tranche of the Placing raising gross proceeds of USD 18,162,500. The issuance of the second tranche of the Placing is to take place ten business days following a drawdown notice issued by the Company. It is subject to the satisfaction of certain key performance indicators, including reducing operating costs of the business to a pre-determined level, launching the next generation CAT-M RM2 ELIoT pallets, achieving commercial deployment of RM2 ELIoT pallets and reviewing the governance of the Company. The Company believes that it has already satisfied or that it is well positioned to satisfy the drawdown conditions by the end of the year, although determination is to be made by the Company's largest shareholder, Woodford Investment Management Limited. The Company raised a further GBP1.4m pursuant to an Open Offer to shareholders in May 2018.

Interim Results Timetable

The Company expects to publish its 1H18 financial results on 14 September 2018.

Kevin Mazula, CEO of RM2 International S.A., commented:

"We are delighted to have started the deployment of 'smart' RM2 ELIoT-enabled pallets with world leaders. Global leaders are become increasingly aware of the benefits that the RM2 ELIoT smart pallets can provide.

With the refinancing and simplification of the capital structure in the first half of 2018, RM2 is fully focused on its future and the implementation of its innovative RM2 ELIoT pallets. Our track and trace technology enables customers to follow the whereabouts of their shipments, providing valuable and cost-saving information and dramatically increasing efficiency in their supply chains, all the while contributing to decreasing their carbon footprint."

For further information:

 
                                                    [phone] 
 RM2 International S.A.                                       9571 
 Kevin Mazula, Chief Executive Officer 
  Jean-Francois Blouvac, Chief Financial Officer 
 
 Strand Hanson Limited (Nominated & Financial       [phone] 
  Adviser and Broker)                                         3494 
 James Spinney / Ritchie Balmer / James Bellman 
                                                    [phone] 
 Citigate Dewe Rogerson (Financial PR)                        9571 
 Simon Rigby 
  Elizabeth Kittle 
 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.

Notes to Editors

RM2 International S.A. specialises in pallet development, manufacture, supply and management to establish a leading presence in global pallet supply and improve the supply chain of manufacturing and distribution businesses through the effective and efficient use and management of composite pallets. It is quoted on the AIM market of the London Stock Exchange under the symbol RM2.L. For further information, please visit www.rm2.com

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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September 07, 2018 02:00 ET (06:00 GMT)