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STG Strip Tinning Holdings Plc

46.00
0.00 (0.00%)
23 May 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Strip Tinning Holdings Plc LSE:STG London Ordinary Share GB00BMHN9M05 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 46.00 44.00 48.00 0.00 01:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Fabricated Metal Pds, Nec 10.67M -4.93M -0.3186 -1.44 7.11M

Strip Tinning Holdings PLC Interim Results (3407L)

05/09/2023 7:00am

UK Regulatory


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TIDMSTG

RNS Number : 3407L

Strip Tinning Holdings PLC

05 September 2023

5 September 2023

Strip Tinning Holdings plc

("Strip Tinning" or the "Company")

Interim Results

Strip Tinning Holdings plc (AIM: STG), a leading supplier of specialist connection systems to the automotive sector, is pleased to announce its unaudited results for the six months ended 30 June 2023(1) .

Key Financials:

   --      Total Revenues of GBP5.6m (H1 2022: GBP4.7m) 
   --      Glazing product sales up 23% to GBP5m (H1 2022: GBP4.1m) 
   --      EV product sales of GBP0.6m (H1 2022: GBP0.6m) 
   --      Combined Gross Margin of GBP1.5m /26.7% (H1 2022: GBP0.4m / 8.8%) 
   --      Adjusted(2) EBITDA of GBP0.05m (H1 2022: loss of GBP1.6m) 

-- Cash generation from operations of GBP0.1m (H1 2022: -GBP3.5m); cash balance of GBP0.7m with no draw down against the CID facility

   --      Basic EPS(3) of (2.85)p versus H1 2022 (17.8)p 
   --      The Board remains confident of meeting market expectations for FY23 

Operational updates:

   --      Completion of new production line for flexible printed circuits ("FPCs") 

-- Production line benefitted from the GBP1.4m of funding provided under the Advanced Propulsion Centre's ("APC") Scale-up Readiness Validation ("SuRV") scheme, awarded in September 2022

-- Transfer and re-layout of Connectors production into a single building completed, improving productivity

-- Multiple further improvements including automation projects, improved ERP functionality, implementation of EDI with our customers, cross training and improved communications

Adam Robson, Executive Chair of Strip Tinning, commented: "I am pleased to be able to report the significant turnaround that the Company has achieved over the last 12 months and the positive outlook we see ahead.

Over the past year, we have focussed on strengthening our business and enhancing our capabilities. We are pleased with the platform for growth that has been developed. Converting these growth prospects into production nominations is now a key priority.

To capitalise to the maximum extent possible on the growth opportunities we see ahead of us and to fully satisfy our customers with delivery of the new production nominations we have won, we plan to continue to ramp-up our investments in people, including engineering, project management, quality sourcing and sales. We remain optimistic about our promising sales pipelines for EV and Glazing beyond 2023, with potential new profitable nominations in the near future."

(1) Comparative numbers for the half year to 30 June 2002 are for Strip Tinning Limited.

(2) Adjusted for FX impacts, share based payments, restructuring and IPO exceptionals

(3) Based on weighted average number of shares in the period

 
 Enquiries: 
 Strip Tinning Holdings plc                         Via Alma PR 
  Adam Robson, Exec Chair 
  Richard Barton, Chief Executive 
  Officer 
  Adam Le Van, Chief Financial 
  Officer 
 Singer Capital Markets (Nominated 
  Adviser and Sole Broker) 
  Rick Thompson 
  James Fischer                            +44 (0) 20 7496 3000 
 Alma PR (Financial PR)               striptinning@almapr.co.uk 
  Josh Royston                             +44 (0) 20 3405 0205 
  Joe Pederzolli 
 

A copy of this announcement will be available to view on the Company's website at www.striptinning.com .

Chief Executive's Report

Introduction

I am pleased to be able to report in these results the significant turnaround that the Company has achieved over the last 12 months and the positive outlook we see ahead.

Our key financial metric is Adjusted EBITDA and this has been positive in each of the first six months (H1) of 2023, totalling GBP0.05m (H1 2022: -GBP1.6m) a very significant improvement over 2022. The Board is confident that the Company will meet market expectations for the Full Year.

We have also been pleased with our cash performance in H1. Cash generated from operations was near break-even at GBP0.1m (H1 2022: -GBP3.5m) and as at 30(th) June we had no draw-down on our CID facility. We have taken this opportunity to change CID provider to one that gives us lower costs and preferential lending criteria which has improved our actual available credit to about GBP1.2m based on our current customer receivables book.

There have been a number of key drivers of the improvement in EBITDA, the most significant of which are:

   --      Increased sales with GBP5.6m being reported in H1 2023 (H1 2022: GBP4.7m); 
   --      The price increases we agreed with customers during 2022; 

-- The leadership of the strengthened senior management team, working under Mark Perrins, our MD who joined us in March 2022; and

-- The improvements in productivity, quality and customer service that the team are delivering.

It has been gratifying to see the results of the many improvements we have made to the business being reflected in both our financial results and in our new business pipeline, a key indicator of customer satisfaction. We are now a significantly healthier and more developed Company compared to a year ago. We have grown stronger by successfully navigating through the challenging obstacles and severe headwinds of 2022, which included the Russian invasion of Ukraine, shortages of materials, intense inflationary pressures and the aftermath of COVID. Consequently, we are better placed than ever to capitalise on the increasing momentum we see across the business and our markets.

As ever, I must also thank all of our employees for their determined efforts that have brought us this far and who are the foundation of our successes, past and future.

Market Opportunity

In both the markets we serve, we are seeing an improved market position with strong customer demand and our enhanced competitiveness is opening the door to accelerating growth.

The market for EV battery packs continues to grow at very high rates, supported by the governments' determination to address climate change, consumer enthusiasm and the strategic drive of the automotive industry. For H1 2023, registrations in Europe(4) (EU, EFTA and UK) of battery electric powered vehicles (full and hybrid) grew by 27.2% year on year (and by 45.0% for full BEVs) meaning that 47.3% of all vehicles registered in this period contained a battery pack. Similar high growth rates are being seen in the mid-market which is our primary target market. In the truck market, registrations in Europe(5) (EU, EFTA and UK) of battery electric powered vehicles (full and hybrid) grew by 385% year on year (although the total share remains low at 1.8% of all vehicles sold in H1 2023). Investment in new electric mobility and delivery vehicles, from autonomous delivery vans to e-VTOL aircraft continues apace. These mid-market customers are highly attracted to working with European suppliers such as Strip Tinning who can provide local, highly responsive, full service, engineered solutions for their battery pack developments.

For our Glazing connectors business, we benefit from having a high share of higher specification vehicles that we supply onto (including many BEVs), so by capitalising on the higher volume growth rates seen in these vehicle categories as well as higher product prices based on enhanced electrical functionality within the glazing products. Year on year Glazing sales growth in H1 was 23.5% which is higher than the overall growth of 17.6% in vehicle registrations, which is encouraging. We are seeing a two tier structure appear in the industry supply base in Europe with commodity products being increasingly sourced from Asia, whilst the supply base for higher value added products, on which we are focussed, has seen a contraction with smaller competitors leaving the industry and very large competitors refocussing on other larger market segments (such as battery packs).

(4) ACEA New Passenger Car Registration 19 July 2023 https://www.acea.auto/files/20230719_PRPC_2306-FINAL.pdf

(5) ACEA New Commercial Vehicle Registration 27 July 2023 https://www.acea.auto/files/20230727_PRCV_Q1-Q2_2023.pdf

Review of Operations

Our operations continue to benefit from the integrated sales, engineering, programme management, purchasing, quality, production and HR team which operates across our site, optimising the skills of the team and the transfer of capabilities and capacity between our two lines of business.

EV

The major step forward made in the first half of 2023 has been the completion of our new production line for flexible printed circuits (FPCs), used primarily in our Cell Contact Systems ("CCS") but also increasingly for high end Glazing connectors. This line benefitted from the GBP1.4m of funding provided under the Advanced Propulsion Centre's ("APC") Scale-up Readiness Validation ("SuRV") scheme which was awarded to us in September 2022. The line has a capacity of around 180,000 units per annum, depending on the dimensions of the pieces. The new factory layout has this FPC line adjacent to the laminate busbar production line and both lead directly into the CCS assembly and test operations. Investment in these facilities continues, in particular, as we enhance our laser assembly capabilities - requirement is currently estimated at GBP1.8 million. The total value will depend on the exact size and terms of nominations received over the coming months.

We also continue to engage with a growing number of mid-market actual and prospective customers. We are today producing production parts for two active customer CCS programmes and samples for multiple programmes in development. Total revenues from these activities in H1 were GBP0.6m (H12022: GBP0.6m).

Our pipeline for new EV programmes is developing strongly, with leads exceeding our ability to respond in all cases, a factor that emphasises the value of our strict mid-market focus and the significance of our plans to further grow our people resources. At the end of the half year, our Top 15 sales leads (based on strength of engagement) had a total annualised sales value of GBP88m, with typical annual sales ranging from GBP1m to GBP10m+ and with production nomination dates ranging from 2023 to 2026. We remain optimistic that we will be able to announce a next major EV nomination in Q3.

We announced last August the notice purporting to terminate our contract with a Croatian electric vehicle technology innovator for the supply of cell management systems to a leading German OEM. We believe we have reached an amicable settlement with this customer which leaves us free of any further costs arising from this dispute.

Glazing

Sales in H1 were GBP5.1m (H1 2022: GBP4.1m) which was ahead of our expectations. This growth is the net outcome of increased prices and demand partially offset by reduced volumes and we have (in agreement with our customers) been stopping production of loss making products. These changes will be completed in H2 2023 and as a result we expect sales in H2 to be lower than in H1 2023. However, gross margins have improved, from 8.6% in H1 2022 to 27.1% in H1 2023 and further improvement is expected in H2 2023 despite the decline in sales.

Throughout 2022 and into 2023, we have been working on a lean turnaround of our Glazing operations and we are pleased with the progress made which has been a further contributor to the improving gross margins. The most obvious manifestation of these improvements has been the transfer and re-layout of Connectors production into a single building, which has improved productivity and when combined with selective investments to reduce bottle necks has allowed us to stop our night shift production (leaving this to provide a future capacity increase of up to 50%). In addition to this change there have been multiple other improvements including automation projects, improved ERP functionality, implementation of EDI with our customers, cross training and improved communications. In aggregate, our production headcount is now 90 lower than its peak level in November 2023 and we expect to see further rationalisation in H2 2023.

The Glazing business is now looking to return to growth with new production nominations being won or in the pipeline. We are intent on delivering growth in both sales and margins through a focus on higher value added products and our selective pipeline for these types of products is developing strongly. At the end of the half year, our top 15 leads (based on strength of engagement) had a total annualised sales value of GBP2.9m with production nominations expected over the next 12 months. We are optimistic that this will deliver net Glazing sales growth in 2024 from its low point in H2 2023.

Outlook

For the full year 2023, the Board remains confident of meeting market expectations.

Over the past year, we have focussed on strengthening our business and enhancing our capabilities. We are pleased with the platform for growth that has been developed. Converting these growth prospects into production nominations is a key priority.

To capitalise to the maximum extent possible on the growth opportunities we see ahead of us and to fully satisfy our customers with delivery of the new production nominations we have won, we plan to continue to ramp-up our investments in people, including engineering, project management, quality sourcing and sales. Consequently, we do not expect to deliver profitability ahead of expectations.

Looking beyond 2023, we are greatly encouraged by the strength of our new sales pipelines for both EV and Glazing and we expect to be able to announce material profitable new sales nominations over the coming months.

Financial Review

 
                          GBP'000   GBP'000 
                            H1 
                            2023    H1 2022 
 Glazing product sales      5,050     4,089 
 EV product sales             596       588 
 Total Revenues             5,646     4,677 
 Gross Margin               1,512       410 
-----------------------  --------  -------- 
 Gross Margin %             26.7%      8.8% 
 Adjusted EBITDA               51   (1,636) 
-----------------------  --------  -------- 
 Depreciation               (544)     (687) 
 Amortisation                (34)        13 
 FX                          (17)        43 
 Taxation fees               (14)         - 
 Reorganisation (Staff 
  Exceptionals)                 -      (91) 
 Share Based Payments        (90)      (62) 
 IPO Exceptionals               -     (382) 
 Operating Profit / 
  (Loss)                    (648)   (2,802) 
-----------------------  --------  -------- 
 Financing Costs            (150)      (81) 
 Tax                          357       412 
 Net Income                 (441)   (2,471) 
-----------------------  --------  -------- 
 

Glazing sales were up 23% compared to H1 2022, with EV sales up over 40% on the same period after stripping out sales attributable to the cancelled Croatian EV contract.

The price rises achieved on the Glazing products combined with progress on materials cost reductions and reduced direct headcount increased gross profit by GBP1.1m in absolute terms, and gross margin from 8.8% to 26.7%. Overheads increased by 8% in H1 2023, reflecting continued investment in the EV business and full period run rates compared to 2022. The benefit to the business is deemed greater than the percentage increase indicates as the total increase from new hires improving capability and effectiveness was partially offset by combining other roles to improve efficiency, limiting the net headcount cost increase. H1 2023 also benefited from GBP0.7m of SuRV Grant income.

The combination of an improving external market and the proactive actions taken by the Company have led to a positive adjusted EBITDA for H1 2023 of GBP0.05m, compared to an EBITDA loss of GBP1.6m in H1 2022.

Financing costs have increased due to asset finance investments and fees associated with the CID facility, but the Company has benefited from high R&D Tax Credit payments, evidencing the Knowledge Intensive Company status held and additional patent applications are under active review.

Capital investment has been considerable, including for additional Clean Rooms, Ink Jet Printer, upgraded Flexible Printed Circuit wet cell and Automatic Optical Inspection unit to deliver industry leading capabilities.

The stock reduction between H1 2022 and H1 2023 is flattered by provisions made at the 2022 year end, but real improvements have been made in H1 2023 and true reductions in stock holdings are expected to continue in H2 2023, with this a priority focus for management. Debtors have not increased in line with sales growth due to improved debtor collections, with reduced overdues.

The Company has signed a new Confidential Invoice Discounting facility ("CID"). The key terms of the CID are a GBP1.5m facility limit, based on a 75% advance rate against eligible debtors, at 2.85% above base rate. Cash stood at GBP0.7m as at 30 June 2023, with no draw down against the CID facility. The Company continues to benefit from the government grant award to assist with the scale-up of the EV business and R&D Tax Credit claims.

Statement of Consolidated Comprehensive Income f or the six months ended 30 June 2023

 
                                 Note     Unaudited      Unaudited 
                                         Six months     Six months 
                                           ended 30       ended 30 
                                               June           June 
                                               2023           2022 
                                            GBP'000        GBP'000 
 
 Revenue                          3           5,646          4,677 
 
 Cost of sales                              (4,134)        (4,267) 
 
 Gross profit                                 1,512            410 
 
 Other operating income           4             790             13 
 
 Administrative expenses 
  excluding exceptional 
  costs                                     (2,950)        (2,843) 
 Exceptional IPO related 
  expenses                        5               -          (382) 
 
 Total administrative 
  expenses                                  (2,950)        (3,225) 
 
 Operating loss                               (648)        (2,802) 
 
 Finance costs                                (150)           (81) 
 
 Loss before taxation                         (798)        (2,883) 
 
 Taxation                         6             357            412 
 
 Loss and total comprehensive 
  expense for the period                      (441)        (2,471) 
                                       ------------  ------------- 
 
 Loss per share (pence) 
 Basic and diluted                7          (2.85)         (17.8) 
                                       ------------  ------------- 
 
 

Consolidated statement of Financial Position as at 30 June 2023

 
                                Notes   Unaudited        Audited   Unaudited 
                                          30 June    31 December     30 June 
                                             2023           2022        2022 
                                          GBP'000        GBP'000     GBP'000 
 ASSETS 
 Non-current assets 
 Intangible assets                          1,193          1,277       1,489 
 Right-of-use assets                        1,201          1,151       1,287 
 Property, plant and 
  equipment                                 3,202          2,950       2,936 
                                                   ------------- 
                                            5,596          5,378       5,712 
                                       ----------  -------------  ---------- 
 
 Current assets 
 Inventories                                1,518          1,848       2,316 
 Trade and other receivables                2,427          3,381       2,155 
 Corporation tax receivable                   386            559         353 
 Cash and cash equivalents                    736          1,290       3,134 
                                       ----------  -------------  ---------- 
                                            5,067          7,078       7,958 
                                       ----------  -------------  ---------- 
 
 Total assets                              10,663         12,456      13,670 
                                       ----------  -------------  ---------- 
 
 LIABILITIES 
 Current liabilities 
 Trade and other payables                 (1,766)        (3,045)     (1,678) 
 Borrowings                                 (483)          (553)       (567) 
 Lease liabilities                          (173)          (182)       (177) 
                                                   ------------- 
                                          (2,422)        (3,780)     (2,422) 
                                       ----------  -------------  ---------- 
 
 Non-current liabilities 
 Accruals and deferred 
  income                                     (24)           (37)       (137) 
 Borrowings                                 (846)          (992)       (945) 
 Lease liabilities                        (1,064)          (995)     (1,099) 
 Provisions                                 (233)          (227)       (222) 
                                          (2,167)        (2,251)     (2,403) 
                                       ----------  -------------  ---------- 
 
 Total liabilities                        (4,589)        (6,031)     (4,825) 
                                       ----------  -------------  ---------- 
 
 Net assets                                 6,074          6,425       8,845 
                                       ----------  -------------  ---------- 
 
 EQUITY 
 
 Share capital                    8           154            154         151 
 Share premium account                      6,966          6,966       6,966 
 Merger reserve                             (100)          (100)       (100) 
 Other reserve                                (3)            (3)           - 
 Retained earnings                          (943)          (592)       1,828 
                                                   ------------- 
 Total equity                               6,074          6,425       8,845 
                                       ----------  -------------  ---------- 
 

Consolidated statement of changes in equity

 
 
                                    Share      Share     Merger      Other    Retained     Total 
                                  capital    premium    reserve    reserve    earnings    equity 
                                  GBP'000    GBP'000    GBP'000    GBP'000     GBP'000   GBP'000 
 
 At 1 January 2022                    100          -      (100)          -       4,237     4,237 
 
 Loss and total comprehensive 
  expense for the period                -          -                           (2,471)   (2,471) 
 
 Shares issued in the 
  period                               51      6,966          -          -           -     7,017 
 Share based payment                    -          -          -          -          62        62 
                                           ---------  --------- 
 At 30 June 2022                      151      6,966      (100)          -       1,828     8,845 
                                ---------  ---------  ---------  ---------  ----------  -------- 
 
 Loss and total comprehensive 
  expense for the period                -          -          -          -     (2,454)   (2,454) 
 
 Shares issued in the 
  period                                3          -          -        (3)           -         - 
 Share based payment                    -          -          -          -          34        34 
 
 At 31 December 2022                  154      6,966      (100)        (3)       (592)     6,425 
                                ---------  ---------  ---------  ---------  ----------  -------- 
 
 Loss and total comprehensive 
  expense for the period                -          -          -          -       (441)     (441) 
 
 Share based payment                    -          -          -          -          90        90 
 
 At 30 June 2023                      154      6,966      (100)        (3)       (943)     6,074 
                                ---------  ---------  ---------  ---------  ----------  -------- 
 
 

Consolidated statement of cash flows for the six months ended 30 June 2023

 
                                                Unaudited              Unaudited 
                                               Six months             Six months 
                                                 ended 30               ended 30 
                                                June 2023              June 2022 
                                                  GBP'000                GBP'000 
 Cash flow from operating activities 
 Loss for the financial period                      (441)                (2,471) 
 Adjustment for: 
 Depreciation of property, plant 
  and equipment                                       435                    285 
 Depreciation of right-of-use assets                  109                    171 
 Amortisation of intangible assets                     84                    229 
 Amortisation of government grants                   (49)                   (13) 
 Share based payment                                   90                     62 
 Finance costs                                        150                     81 
 Taxation credit                                    (357)                  (412) 
 Changes in working capital: 
 Decrease/(increase) in inventories                   330                  (302) 
 Decrease in trade and other receivables              954                  1,623 
 Decrease in trade and other payables             (1,237)                (2,707) 
                                             ------------  --------------------- 
 Cash generated from/(used in) 
  operations                                           68                (3,454) 
 Income tax received                                  530                      - 
                                             ------------  --------------------- 
 Net cash from/(used in) operating 
  activities                                          598                (3,454) 
                                             ------------  --------------------- 
 
 Cash flow from investing activities 
 Purchase of property, plant and 
  equipment                                         (604)                  (132) 
 Purchase of intangible assets                          -                  (157) 
 Net cash used in investing activities              (604)                  (289) 
                                             ------------  --------------------- 
 
 
 
 Cash flow from financing activities 
 Shares issued (net of issue costs)            -     7,017 
 Interest paid                             (150)      (81) 
 Payment of lease liabilities               (99)     (114) 
 Repayment of bank loans                    (19)         - 
 Repayment of capital element of 
  hire purchase contracts                  (280)     (282) 
                                        --------  -------- 
 Net cash (used in)/generated from 
  financing activities                     (548)     6,540 
                                        --------  -------- 
 
 
   (Decrease)/increase in cash and 
   cash equivalents                        (554)     2,797 
                                        --------  -------- 
 
 Net cash and cash equivalents at 
  beginning of the period                  1,290       337 
 
 Net cash and cash equivalents 
  at end of the period (all cash 
  balances)                                  736     3,134 
                                        --------  -------- 
 
 

Notes to the interim consolidated financial statements f or the six months ended 30 June 2023

   1.      Corporate information 

Strip Tinning Holdings plc is a public company incorporated in the United Kingdom. The registered address of the Company is Arden Business Park, Arden Road, Frankley Birmingham, West Midlands, B45 0JA.

The principal activity of the Company and its subsidiary (the 'Group') is the manufacture of automotive busbar, ancillary connectors and flexible printed circuits.

   2.      Accounting policies 

Basis of preparation

This unaudited condensed consolidated interim financial statements for the six months ended 30 June 2023 and 30 June 2022 have been prepared in accordance with UK adopted international accounting standards ("IFRS") including IAS 34 'Interim Financial Reporting'.

The accounting policies applied by the Group include those as set out in the financial statements for the year ended 31 December 2022 and are consistent with those to be used by the Group in its next financial statements for the year ending 31 December 2023. There are no new standards, interpretations and amendments which are not yet effective in these financial statements, expected to have a material effect on the Group's future financial statements.

The financial information does not contain all of the information that is required to be disclosed in a full set of IFRS financial statements. The financial information for the six months ended 30 June 2023 and 30 June 2022 is unreviewed and unaudited and does not constitute the Group's statutory financial statements for those periods.

The comparative financial information for the full year ended 31 December 2022 has, however, been derived from the audited statutory financial statements for Strip Tinning Holdings plc for that period. A copy of those statutory financial statements has been delivered to the Registrar of Companies. The auditor's report on those accounts was unqualified and did not contain a statement under section 498(2)-(3) of the Companies Act 2006.

These policies have been applied consistently to all periods presented, unless otherwise stated.

The interim financial information has been prepared under the historical cost convention with the exception of fair value calculations applied in accounting for share based payments. The financial information and the notes to the historical financial information are presented in thousands of pounds sterling ('GBP'000'), the functional and presentation currency of the Group, except where otherwise indicated.

Going concern

After making appropriate enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for at least twelve months from the date of approval of the financial information. In adopting the going concern basis for preparing the financial statements, the directors have considered a base case going concern model. The results of this model suggested that with the financing arrangements available to the business and / or realistic mitigating actions, the Group has adequate resources to continue in operational existence. For this reason, the directors continue to adopt the going concern basis in preparing the Group's financial information.

   3.      Segmental and geographical destination reporting 

IFRS 8, Operating Segments, requires operating segments to be identified on the basis of internal reports that are regularly reviewed by the company's chief operating decision maker. The chief operating decision maker is considered to be the executive Directors.

The operating segments are monitored by the chief operating decision maker and strategic decisions are made on the basis of adjusted segment operating results. All assets, liabilities and revenues are located in, or derived in, the United Kingdom. In addition to the established automotive glazing products business ('Glazing' segment), the Group has commenced the development and initial sales of components for electric vehicle battery packs ('EV' segment) which are expected to grow to be a material segment. Many of the Glazing products are used on electric vehicles but these reman classified as Glazing not EV products. Separate management reporting and information is prepared at a revenue and gross profit level only for the Glazing and EV segments as follows:

 
                                Glazing        EV     Total 
 6 months ended 30 June 2023    GBP'000   GBP'000   GBP'000 
 
 Revenue                          5,050       596     5,646 
 Cost of sales                  (3,680)     (454)   (4,134) 
                               --------  --------  -------- 
 Gross profit                     1,370       142     1,512 
                               --------  --------  -------- 
 
 
                                Glazing        EV     Total 
 6 months ended 30 June 2022    GBP'000   GBP'000   GBP'000 
 
 Revenue                          4,089       588     4,677 
 Cost of sales                  (3,736)     (531)   (4,267) 
                               --------  --------  -------- 
 Gross profit                       353        59       412 
                               --------  --------  -------- 
 

Turnover with the largest customers (including customer groups) representing in excess of 10% of total revenue in the period for 2 customers (2022: 3 customers) has been as follows:

 
                 Six months   Six months 
                   ended 30     ended 30 
                  June 2023    June 2022 
                    GBP'000      GBP'000 
 Customer A           1,575          908 
 Customer B             711        1,060 
 Customer C             491          555 
 

All revenue arises at a point in time and relates to the sale of automotive busbar, ancillary connectors and flexible printed circuit product. Turnover by geographical destination is as follows:

 
                      Six months   Six months 
                        ended 30     ended 30 
                       June 2023    June 2022 
                         GBP'000      GBP'000 
 
 UK                          706          418 
 Rest of Europe            2,738        2,842 
 Rest of the World         2,202        1,417 
                     -----------  ----------- 
                           5,646        4,677 
                     -----------  ----------- 
 
   4.      Other operating income 
 
                                   Six months   Six months 
                                     ended 30     ended 30 
                                    June 2023    June 2022 
                                      GBP'000      GBP'000 
 
 Government revenue development           741            - 
  grants 
 Amortisation of capital grants            49           13 
                                  -----------  ----------- 
                                          790           13 
                                  -----------  ----------- 
 

T he group was awarded a GBP1.484m UK innovation development grant in respect of revenue expenditure with GBP741,000 recognised against eligible costs in the period. GBP389,000 was recognised in the second half of 2022 with GBP354,000 expected to be recognised in the remainder of 2023.

   5.      Exceptional costs 
 
                       Six months     Six months 
                         ended 30       ended 30 
                        June 2023      June 2022 
                          GBP'000        GBP'000 
 
 IPO related costs                -          382 
                     --------------  ----------- 
 

The directors consider that the specific professional fees and costs incurred in preparation for the IPO and connection with the admission process are exceptional as they are non-recurring in nature and not related to the underlying trading. The majority of the fees were recorded against the share premium account as they relate to the new shares issued with the balance expensed.

   6.      Income tax 
 
 
                                    Six months   Six months 
                                      ended 30     ended 30 
                                     June 2023    June 2022 
                                       GBP'000      GBP'000 
 
 Current tax: 
 UK corporation tax                         78           74 
 Adjustments in respect of prior           279            - 
  periods 
 Total current tax credit                  357           74 
 
 Deferred tax: 
 Origination and reversal of 
  temporary differences                      -          338 
                                                          - 
 Total deferred tax credit                   -          338 
 
 Total tax credit                          357          412 
                                   -----------  ----------- 
 
 

The credit for the period can be reconciled to the loss for the period as follows:

 
                                        Six months   Six months 
                                          ended 30     ended 30 
                                         June 2023    June 2022 
                                           GBP'000      GBP'000 
 
 Loss before taxation                        (798)      (2,883) 
                                       -----------  ----------- 
 
 Income tax calculated at 
  22% (2022: 19%)                            (176)        (548) 
 Expenses not deductible                        20           88 
 Enhanced research and development 
  allowances                                  (12)         (32) 
 Enhanced capital allowances                  (20)          (6) 
 Deferred tax not recognised                   110          220 
 Adjustments in respect                      (279)            - 
  of prior periods 
 Effect of differing deferred 
  tax and current period 
  tax rates                                      -        (134) 
 Total tax credit                            (357)        (412) 
                                       -----------  ----------- 
 

The tax rate used to calculate deferred tax is 25% at 30 June 2023 (2022: 25%), being the rate at which the timing differences were expected to unwind based on enacted UK corporate tax legislation at each balance sheet date.

A deferred tax asset has not been recognised for losses carried forward as, the key accounting judgement made is that it is not yet considered sufficiently probable that the losses will be utilised in the short term.

   7.      Earnings per share 

The calculation of the basic and diluted earnings per share is based on the following data:

 
 
 Earnings                             Six months     Six months 
                                        ended 30       ended 30 
                                       June 2023      June 2022 
                                         GBP'000        GBP'000 
 
 Loss for the purpose of basic 
  and diluted earnings per share 
  being net loss attributable 
  to the shareholders                      (441)        (2,471) 
                                   -------------  ------------- 
 
                                      Six months     Six months 
                                        ended 30       ended 30 
                                       June 2023      June 2022 
 Number of shares 
 
 Weighted average number of 
  ordinary GBP0.01 shares for 
  the purposes of basic and 
  diluted loss per share              15,459,714     13,895,056 
                                                  ------------- 
 
 
 

There were options in place over 734,505 shares at 30 June 2023 (2022: 254,051) that were anti-dilutive at the period end but which may dilute future earnings per share.

   8.      Share capital 

The movements in share capital have been as follows:

 
                                             Number   Nominal   Share premium 
                                         of GBP0.01 
                                             shares 
                                                      GBP'000         GBP'000 
 
 Share issued on incorporation                    1         -               - 
 Shares issued in exchange for Strip 
  Tinning Limited shares                  9,999,999       100               - 
 EIS and VCT placing shares issued 
  at GBP1.85 each                         2,702,702        27           4,973 
 Other placing shares issued at 
  GBP1.85 each                            1,621,622        16           2,984 
 Exercise of options at GBP0.116 
  each                                      813,045         8              86 
 Share issue costs                                                    (1,077) 
                                       ------------  --------  -------------- 
 At 30 June 2022                         15,137,369       151           6,966 
 
 Shares issued to employee benefit 
  trust at GBP0.01 each                     322,345         3               - 
                                       ------------  --------  -------------- 
 At 31 December 2022 and 30 June 
  2023                                   15,459,714       154           6,966 
                                       ------------  --------  -------------- 
 
 

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