TIDMSRT
RNS Number : 3196H
SRT Marine Systems PLC
27 July 2023
SRT MARINE SYSTEMS PLC
(AIM: SRT)
("SRT" or the "Company")
FINAL RESULTS FOR THE YEARED 31 MARCH 2023
SRT Marine Systems PLC, a provider of maritime surveillance,
monitoring and management systems, announces its results for the
financial year ending 31 March 2023.
FINANCIAL SUMMARY
-- Increased revenues to GBP30.5m.
-- Profit after tax GBP0.1m.
-- GBP2.2m gross cash at year end. Post year end GBP5.4m equity
raise and GBP20m loan note programme headroom increase.
-- GBP160m systems forward contract order book and GBP1.4bn new prospects pipeline.
OPERATIONAL HIGHLIGHTS
-- Significant transceiver distributor network expansion.
-- Continued progress with new NEXUS VHF/AIS radio system and
DAS transceiver products, both of which entered testing phases.
-- Expansion of analytics within the SRT-MDA System to improve
dark vessel detection and tracking capabilities.
-- Expansion of SRT delivery team to accommodate multiple simultaneous projects.
NOTICE OF AGM
-- The AGM will be held at the Centurion Hotel, Charlton Lane,
Radstock BA3 4BD at 11.00am on September 19, 2023. Prior to the
commencement of the formal AGM there will be an Open Morning at
SRT's offices, commencing at 9.00am.
Commenting on today's results, Simon Tucker, CEO of SRT
said:
"Our many years of technology, product and market investments
are now starting to show in our financial results. Our transceivers
division grew by 60% and our systems division is back on track
following a pause in government business during Covid. We go into
the new year with an expanded product range and distribution
network, a forward contract order book of GBP160m and a new
prospects pipeline of system contracts worth approximately
GBP1.4bn. This position reflects the early strategic decisions made
to position SRT at the centre of these substantial global
markets."
Contacts:
SRT Marine Systems plc www.srt-marine.com
+ 44 (0) 1761 409500
Simon Tucker (CEO) simon.tucker@srt-marine.com
Louise Coates (Marketing Manager) louise.coates@srt-marine.com
finnCap Ltd
Jonny Franklin-Adams / Teddy Whiley (Corporate
Finance) +44 (0) 20 7220 0500
Tim Redfern / Charlotte Sutcliffe (Corporate
Broking)
About SRT:
SRT Marine Systems PLC is a global company which develops and
provides integrated maritime surveillance, monitoring, management
and safety systems used by coast guards, fishery authorities,
infrastructure and vessel owners for the purposes of managing
and controlling their maritime domain. Applications include security,
safety, search & rescue, law enforcement, fisheries management,
illegal fishing detection and environment monitoring.
The information contained within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulation (EU) No. 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018. Upon the
publication of this announcement, this inside information is
now considered to be in the public domain.
CHAIRMAN'S STATEMENT
Whilst not as high as we had hoped, I am pleased to report that
we were profitable on a 273% year on year increase in revenues
to GBP30.5m as our target markets recovered and recommenced their
expansion enabling us to benefit from our accumulated investments
in technologies, products and customers over many years and enter
the new financial year with a GBP160m forward order book and substantial
new prospects pipeline.
As reported in our year-end trading update in March 2023, year
on year group revenues grew to GBP30.5m (2022: GBP8.2m) of which
transceivers generated GBP12.1m and systems GBP18.4m. Gross profit
margin increased to 36% (2022: 33%), resulting in a profit after
tax of GBP0.1m (2022: loss GBP5.8m). As at year-end, gross cash
was GBP2.2m (2022: GBP5.9m), and after the year-end we completed
an equity raise of GBP5.4m and increased our loan note programme
capacity by an additional GBP20m.
During the period our systems business executed on three projects,
two with coast guards and one with a national fisheries ministry,
increased our forward contract order book to GBP160m and grew our
new prospects pipeline to be worth an estimated GBP1.4bn. This
growth is driven by the increasing desire of national agencies
to have effective maritime surveillance and intelligence in line
with what has become the norm in air traffic control.
The Philippine BFAR IMEMS system is now fully operational and in
daily use, enabling BFAR to track, monitor and manage all their
fisheries within a single optimised system. This project was originally
scheduled to complete in December 2022, but is now expected to
complete during 2023. This delay is a consequence of COVID where
all installation work was suspended for well over a year due to
mandatory travel and work suspensions. We also won and delivered
a small but strategically important project to a national coast
guard to enable the sharing of maritime information between multiple
government agencies and completed the first phase of a GBP40m SRT-MDA
System Vessel Tracking & Identification systems contract with a
major Middle East Coast Guard, the formal sign-off of which was
concluded shortly after our financial year end, along with preparations
for the next and final two phases which are scheduled to be implemented
by the end of 2024.
The SRT-MDA System is a flexible and scalable integrated surveillance
system solution that can be configured for either coast guard or
fisheries use. After many years of continuous development, it offers
an extensive range of innovative functionalities and capabilities
that deliver enhanced maritime domain awareness. I am pleased to
report that our development and product team have continued to
enhance existing functionalities and introduce new capabilities.
Of particular note is our focus on multi-sensor and multi-platform
network integration, data fusion and management and intelligent
analytics in the area of automated vessel detection and identification,
along with specialist fisheries functionalities such as aquatic
modelling and electronic catch reporting and auditing. This continuous
development of the SRT-MDA System falls to our expanding development
team which we have carefully built over many years and today combines
a rare blend of scale, talent and experience.
The transceivers division grew year on year by 60% to a turnover
of GBP12.1m, generating a blended gross profit of 45%, with some
product and application areas generating margins as high as 80%
and some 20%. We believe that growth has come from the compound
effect of our reputation for having the best products, being a
reliable supplier, expanding our distribution channels and the
slow but steady rolling adoption and proliferation of AIS across
commercial and leisure vessels. We remain in the early stages of
AIS adoption with an estimated 500,000 vessels out of 26 million
now having an AIS device, and most navigation aids at an even earlier
stage. We therefore see very significant opportunity for steady
long-term growth from our transceivers business driven by the same
fundamentals of recent years.
The primary focus of our transceiver development team has been
the development of our NEXUS VHF/AIS product. This product moves
SRT into the voice communications segment of the leisure and commercial
marine electronics market which has much greater volumes than data
only AIS due to its greater maturity. NEXUS is a significant investment
for SRT and the project is now in its third year, with the expectation
that it will start commercial shipments in early 2024. In 2023
we decided to delay the commencement of shipping by approximately
up to 9 months to allow for further testing. This decision was
made in the context of our global reputation for excellence and
wishing to enter this new segment with a truly innovative product
that matches our history of reliable and trustworthy products.
NEXUS will therefore not contribute material revenues during the
coming financial year, but we do expect it to make an impact thereafter.
In the meantime, we have seen a significant growth in our distribution
network and have added additional sales and marketing resource,
particularly with our first in-territory presence in the USA, the
effects of which we expect to see in the coming financial year.
During the year we soft launched our DAS product offer and have
received a good response with visibility of some substantial new
projects. DAS targets the aids to navigation market which is integral
to the digitisation of the marine domain and the realisation of
safer and more efficient navigation. In the coming year we will
invest more in this segment, including the hiring of a dedicated
salesperson.
Shortly after the year end, we signed a new systems contract worth
GBP140m to deliver an integrated maritime surveillance and intelligence
system to a National Coast Guard increasing our forward systems
order book to GBP160m. This opportunity was previously in our new
systems prospects pipeline, which continues to grow and now contains
prospects at various stages of the sales cycle with an aggregate
value of GBP1.4bn, and I expect to see some of these convert into
contracts in the coming months In the first half of the new financial
year, we expect to commence the implementation of the next and
final phases of our Middle East project, whilst the newly signed
GBP140m National Coast Guard contract, with associated revenue
milestone completion will commence first implementation milestones
in the second half of the financial year. As usual, our transceivers
business will be more balanced but with the traditional second
half weighting.
In summary, the year has seen both our businesses grow strongly
as a result of our long-term technology, product and market investments
that have placed SRT at the centre of the global digitisation of
maritime domain awareness and navigation. With over 3,000 transceiver
distribution partners, established products, GBP160m of forward
contracts and a pipeline of new prospects that has grown to GBP1.4bn,
we feel very confident, although not complacent, about the future.
This year really has been operationally tough, with a lot of product
development and sales and contracts work to keep up with market
demands, so I would like to take this opportunity to thank our
staff, partners and shareholders for their hard and diligent work
throughout the year.
Kevin Finn, Chairman
26 July 2023
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME FOR THE YEARED 31 MARCH 2023
Note 2023 2022
GBP GBP
Revenue 30,506,152 8,172,900
Cost of sales (19,467,188) (5,500,942)
Gross profit 11,038,964 2,671,958
Administrative costs (10,723,838) (8,721,560)
Foreign exchange losses (180,102) (147,754)
--------------------------------------------- ------- --------------- ------------------
Total administrative costs and
foreign exchange losses (10,903,940) (8,869,314)
Operating profit / (loss) 135,024 (6,197,356)
Finance expenditure (781,547) (615,648)
Finance income 351 421
Loss before tax (646,172) (6,812,583)
Income tax credit 715,692 974,578
Profit / (loss) for the year after
tax 69,520 (5,838,005)
Total comprehensive income / (expense)
for the year 69,520 (5,838,005)
Earnings / (loss) per share:
Basic 4 0.04p (3.53)p
Diluted 0.04p (3.53)p
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH
2023
2023 2022
Note GBP GBP
Assets
Non-current assets
Intangible assets 11,756,717 9,368,069
Property, plant and equipment 1,256,223 1,328,842
Total non-current assets 13,012,940 10,696,911
Current assets
Inventories 3,465,626 2,359,922
Trade and other receivables 5,828,652 3,847,735
Current tax recoverable 968,607 978,963
Cash 2,181,548 5,924,601
Restricted cash 949,115 906,245
Total current assets 13,393,548 14,017,466
Liabilities
Current liabilities
Trade and other payables (7,009,926) (6,459,635)
Borrowings 5 (8,002,500) (7,245,000)
Current tax liabilities (199,126) -
Lease liabilities (237,371) (201,402)
Total current liabilities (15,448,923) (13,906,037)
Net current (liabilities)
/ assets (2,055,375) 111,429
Total assets less current
liabilities 10,957,565 10,808,340
Non-current liabilities
Borrowings 5 - (312,500)
Lease liabilities (649,946) (703,317)
------------- --------------
Total non-current liabilities (649,946) (1,015,817)
Net assets 10,307,619 9,792,523
Shareholders' equity
Share capital 181,517 180,677
Share premium account 18,213,072 18,067,612
Retained loss (13,577,566) (13,946,362)
Other reserves 5,490,596 5,490,596
Total shareholders' equity 10,307,619 9,792,523
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEARED 31 MARCH
2023
2023 2022
GBP GBP
Cash generated from operating
activities 778,840 1,405,136
Corporation tax received 925,174 789,217
-------------- --------------
Net cash generated from operating
activities 1,704,014 2,194,353
-------------- --------------
Investing activities
Expenditure on product development (4,795,292) (3,327,011)
Purchase of property, plant
and equipment (199,061) (183,802)
Interest received 351 421
Net cash used in investing
activities (4,994,002) (3,510,392)
-------------- --------------
Financing activities
Gross proceeds on issue of
shares 146,300 4,919,130
Costs of issue of shares - (266,828)
New loans issued 1,695,000 1,000,000
Loan repayments (1,250,000) (1,957,500)
Lease repayments (258,835) (267,458)
Loan interest paid (742,660) (566,891)
Net cash (used in) / generated (410,195) 2,860,453
from financing activities
Net (decrease) / increase
in cash and cash equivalents (3,700,183) 1,544,414
-------------- --------------
Net cash and cash equivalents
at beginning of year 6,830,846 5,286,432
--------------
Net cash and cash equivalents
at end of year 3,130,663 6,830,846
============== ==============
Notes
1. Status of financial information
SRT is a public limited company incorporated in England and
Wales whose ordinary shares of 0.1p each are traded on the AIM
Market of the London Stock Exchange. The Company's registered
office is Wireless House, Westfield Industrial Estate, Midsomer
Norton, Bath BA3 4BS.
The Board of Directors approved this preliminary announcement on
26 July 2023. This announcement does not itself contain sufficient
information to comply with all the disclosure requirements of IFRS
and does not constitute statutory accounts of the Company for the
years ended 31 March 2023 or 31 March 2022.
The financial information has been extracted from the statutory
accounts of the Company for the years ended 31 March 2023 and 31
March 2022. The report of the auditors on those statutory accounts
was unqualified and did not contain a statement under section
498(2) or (3) of the Companies Act 2006. The audit reports for the
years ended 31 March 2023 and 2022 drew attention by way of
emphasis to a material uncertainty relating to going concern and
recoverability of certain assets.
The statutory accounts for the year ended 31 March 2022 have
been delivered to the Registrar of Companies, whereas those for the
year ended 31 March 2023 will be delivered to the Registrar of
Companies following the Company's Annual General Meeting.
2. Basis of preparation
The financial statements have been prepared in accordance with
UK-adopted international accounting standards. For the purposes of
the preparation of the consolidated financial information, the
Group has applied all standards and interpretations that are
effective for accounting periods beginning on or after 1 April
2022. The financial information has been prepared under the
historical cost convention unless otherwise stated.
3. Dividends
The Board is not recommending the payment of a final
dividend.
4. Earnings / (loss) per ordinary Share
The basic earnings per share has been calculated on the profit
after taxation of GBP69,520 (2022: loss GBP5,838,005) divided by
the weighted number of ordinary shares in issue of 180,961,021
(2022: 165,167,407).
During the year the calculation of diluted earnings per share
has been calculated on profit on ordinary activities after taxation
of GBP69,520. It assumes conversion of all potentially dilutive
ordinary shares, all of which arise from share options. A
calculation is performed to determine the number of shares that
could have been acquired at fair value, based upon the monetary
value of subscription rights to outstanding share options. The
number of dilutive shares under option was 1,958,724 and the
weighted average number of ordinary shares for the purposes of
dilutive earnings per share was 182,919,745.
During the previous year, the Group incurred a loss on ordinary
activities after taxation and therefore there is no dilution of the
impact of the share options granted.
5. Borrowings
Bank loan
The bank loan (amount owed at 31 March 2023: GBP312,500) was
drawn down in April 2020 as a GBP2,500,000 one year loan provided
under the UK government Coronavirus Business Interruption Loan
Scheme (CBILS) at an interest rate of 0%. During the previous year,
the renewal of this facility has been agreed with quarterly
repayments commencing in July 2021 through to April 2023 at an
interest rate of 2.59% above base rate.
Loan notes
As of 31 March 2023, the outstanding balance of loan notes
amounted to GBP7,690,000. These all relate to drawdowns on a
secured note programme which has been arranged by LGB Capital
Markets and which is secured by a floating charge over the Group's
assets . The loan notes have terms of up to 3 years and an interest
rate of 8%-12%. Subsequent to the year end, the capacity on the
secured note programme has been increased from GBP20 million to
GBP40 million.
During the year ended 31 March 2023 the covenants in relation to
debt service cover and gearing were breached and a waiver from loan
note holders was obtained subsequent to the year end on May 2 2023.
Due to the waiver not being received prior to the year end and the
covenants being re-tested on 30 September 2023, IAS 1 requires that
the loans are all classified as being repayable in less than one
year, despite their maturity dates.
6. Annual Report and AGM
The Annual Report will be available from the Company's website,
www.srt-marine.com once it is published. To locate the report,
click "Investors" and then scroll down the page to "Reports and
Presentations". The Annual Report and Notice of AGM will be posted
to shareholders on 18 August 2023.
The AGM will be held at the Centurion Hotel, Charlton Lane,
Radstock BA3 4BD at 11.00am on September 19, 2023. Prior to the
commencement of the formal AGM there will be an Open Morning at
SRT's offices, commencing at 9.00am.
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END
FR UNSNROUUBUAR
(END) Dow Jones Newswires
July 27, 2023 02:00 ET (06:00 GMT)
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