TIDMTWD
RNS Number : 7976Z
Trackwise Designs PLC
23 September 2020
23 September 2020
TRACKWISE DESIGNS PLC
("Trackwise", the "Company" or the "Group")
Interim Results for the six months ended 30 June 2020
Trackwise Designs (AIM: TWD), a leading provider of specialist
products using printed circuit technology, is pleased to announce
its interim results for the six months ended 30 June 2020.
Financial highlights
-- Revenues GBP2.39m (H1 2019: GBP1.547m)
-- Improved Harness Technology(TM) ("IHT") revenues of GBP252k (H1 2019: GBP547k)
-- Gross margin 17.8% (H1 2019: 38%)
-- Adjusted E BITDA of GBP102k (H1 2019: GBP237k)
-- Adjusted o perating loss of GBP365k (profit H1 2019: GBP61k)
-- Reported profit after taxation of GBP921k (loss H1 2019: GBP(64k))
-- Net cash* of GBP1.612m (31 December 2019: net debt GBP0.302m)
-- Basic EPS of 4.98 pence per share
* Excludes IFRS 16 lease liabilities
Operational highlights
-- Trading performance impacted by COVID-19
-- Gross margin reflects increased capacity investment prior to
anticipated increased business and the impacts of COVID-19
-- Acquisition of Stevenage Circuits Ltd ("SCL"), for an adjusted total consideration of GBP1.8m
o strengthening manufacturing capabilities and customer base
o SCL has traded cash positively since acquisition
-- Deepened relationships with key customers in our target IHT
markets: electric vehicles ("EV"), medical and aerospace, including
first production order for IHT in EV
o increased IHT total customers and opportunities to 82 (H1
2019: 57)
o 10 NDAs signed in period to commence design phase of potential
new customer orders; (14 including post-period NDAs); building a
pipeline of future revenue opportunities
Post period highlights
-- Significant manufacturing agreement signed with UK EV OEM worth up to GBP38m
-- Commissioning of Direct Imaging machine to facilitate
increased IHT production efficiency and capacity at Tewkesbury
site
-- Continued investment in capabilities to support series production
Outlook
Looking ahead, while the Company's full year performance will
reflect the difficult economic trading conditions, the EV
manufacturing contract win and progress in our two other core
target markets, medical and aerospace, support our convictions of
IHT's merit and its potential to be a catalyst for transformation
in these markets, with our innovation enabling the global
technology of the future. We are excited about the near and
long-term prospects for Trackwise with growing visibility of an
increasing number of opportunities.
Philip Johnston, CEO of Trackwise, commented : "While the
business remained open and safely operational throughout the
period, like many businesses we were not immune from the impacts of
COVID-19. Nevertheless we have made excellent progress
strategically with the acquisition of Stevenage Circuits, which has
extended our product range, our expertise and customer base and
increased our production capabilities, enabling us to move towards
the facility in Tewkesbury becoming dedicated to IHT
production.
Since the period end, we completed the commissioning of the
critical roll to roll direct imaging machine, which represents the
final investment of our IPO proceeds and we secured the highly
significant three-year contract to manufacture IHT for electric
vehicles.
Looking ahead, while the Company's full year performance will
reflect the difficult economic trading conditions, the EV
manufacturing contract win and progress in our two other core
target markets, medical and aerospace, support our convictions of
IHT's merit and its potential to be a catalyst for transformation
in these markets, with our innovation enabling the global
technology of the future.
With a growing customer base and pipeline, and a net cash
position, we are confident in our ability to deliver on these
growth opportunities as trading conditions normalise."
Enquiries
Trackwise Designs plc +44 (0)1684 299 930
Philip Johnston, CEO www.trackwise.co.uk
Mark Hodgkins, CFO
finnCap Ltd +44 (0)20 7220 0500
NOMAD and Broker
Ed Frisby/Matthew Radley - Corporate
Finance
Andrew Burdis/Manasa Patil - ECM
Alma PR +44 (0)20 3405 0205
Financial PR and IR
Caroline Forde/Josh Royston/David
Ison/Kieran Breheny
Notes to editors
Trackwise is a UK-based manufacturer of specialist products
using printed circuit technology.
The full suite includes: Improved Harness Technology(TM) ("IHT")
and Advanced PCBs - Microwave and Radio Frequency ("RF"), Short
Flex, Flex Rigid and Rigid Multilayer products.
IHT uses a proprietary, patented process that Trackwise has
developed to manufacture multilayer flexible printed circuits of
unlimited length. While the technology has many applications, the
directors expect that one of its primary uses will be to replace
traditional wire harness in a variety of industries.
The Company manufactures on two sites, located in Tewkesbury and
Stevenage (following the acquisition of Stevenage Circuits Ltd in
April 2020). It serves customers in Europe, North America, Asia and
Australia.
Trackwise Designs plc was admitted to trading on AIM in 2018
with the ticker TWD. For additional information please visit
www.trackwise.co.uk .
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
Chairman's Statement
While we acknowledge the impact of COVID-19 on the short-term
trading environment, which impeded our ability to complete our
investment into new equipment and has prolonged sales cycles, we
remain excited about the near and long-term prospects for Trackwise
and have visibility of a growing number of opportunities.
The wellbeing of our staff has remained our top priority
throughout. We have maintained our strict adherence to all UK
Government safety guidelines and focused on working from home where
possible, while implementing strict social distancing and
additional hygiene measures in our facilities. Our teams responded
well to the challenges and I would like to thank them for their
efforts.
CEO's Statement
Despite COVID-related headwinds affecting our trading
performance, we are pleased to report on excellent strategic
progress for the Company during the period. Major achievements have
been made in both our production capabilities and our reach into
target markets.
The key highlight in the period was the acquisition of SCL in
April 2020. This acquisition represents a transformational step
forward for Trackwise, extending our manufacturing capabilities and
providing capacity at Tewkesbury to deliver IHT series production,
while diversifying our revenue streams and customer base.
Post period, the announcement of our first series production
order from a UK based manufacturer of electric vehicles signified
the next stage of progress for our IHT flexible printed circuit
technology and was a key step into one of our strategic
markets.
Impact of COVID-19
COVID-19 has impacted much of the manufacturing industry and,
despite good progress against our strategic objectives, trading
remains challenging across our business. Much of our typical run
rate business has continued, but we have seen a slow-down in new
orders. A number of new opportunities across our product range
remain in discussion with associated revenues now predominantly
expected in the following financial year.
Revenues from the medical sector were impacted by the delayed
commissioning of new machinery due to lockdown restrictions and
this impacted deliveries to a customer. This has now been rectified
and the product has been supplied to our customer. We were not
alone in experiencing delays in the arrival of manufacturing
machinery, with anticipated follow-on orders from customers
impacted by delays due to the lockdowns in Europe. We will continue
to monitor the situation across our end markets and track our
expectations against the sector-wide performance of these
industries .
Upgrades to Flexible Printed Circuit ("FPC") manufacturing
operations
We continued to strengthen our production capability and
capacity by investing in new equipment, installing and
commissioning an advanced roll-to-roll direct imaging system and a
roll-to-roll flexible circuit laser drilling system. This
investment, alongside the acquisition of SCL, will enable Trackwise
to significantly boost its operational throughput and address
growing customer interest in FPCs based on proprietary IHT
technology. We are now much better positioned to serve future
market opportunities as they arise, supporting greater volume
demands, as well as providing enhanced levels of quality.
IHT
Our IHT technology remains the growth driver for Trackwise and
we are confident in the applicability of this proprietary
technology to our chosen markets and the significant revenues this
has the potential to generate.
We have set out the three markets where we expect to see the
greatest levels of growth for IHT. These are:
1. Electric vehicles
2. Medical
3. Aerospace
We have seen positive developments across these markets during
this period. IHT customers and opportunities grew to 82 by the end
of the period (31 December 2019: 72).
Most significantly, in February we announced an order for the
supply of flex PCBs to a UK EV OEM, with a follow-on manufacturing
agreement signed earlier this month that could be worth up to
GBP38m over three years subject to annual pricing reviews. This
deal is Trackwise's first order for full series production of IHT
and is a strong validation of the application of our technology to
this market and delivery capability.
We remain active in looking for further opportunities within EVs
and expect to benefit from the growing emphasis on the
sustainability agenda and an increasing legislative pressure to
force the automotive sector towards non-fossil fuel motive
power.
There continues to be encouraging levels of interest in IHT from
the medical industry and we continue to work closely with
prospective customers on trials of our technology with a view to
securing a meaningful uptick in revenues in FY21.
In aerospace, our developments with GKN of next generation
systems continue despite the well-documented industry-wide
slowdown.
In the near-term, revenue opportunities will likely continue to
be hindered by COVID-19 disruption, but we remain confident in the
applicability of IHT to all our chosen market sectors.
SCL Acquisition and integration
We completed the transformational acquisition of Stevenage
Circuits Ltd in April 2020, funded through the support of existing
and new investors in a GBP5.87m placing, significantly increasing
our production capabilities. Our focus since completion of the
acquisition has been to ensure the integration of SCL is as
seamless as possible. SCL has been cash generative since the
acquisition, providing a valuable base of largely recurring
revenue. SCL has continued to win new contracts with key accounts,
though these new projects and associated revenues are expected to
be delivered in H2, principally because of COVID-19 related
disruption.
RF
The forthcoming roll out of 5G technology is a re-equipment
opportunity which the Board believe will create demand for the
Company's RF products, now part of the Advanced PCB division.
However, RF continues to be impacted by factors such as Brexit and
the US-China trade war, and continues to be compounded by the
uncertainty caused by COVID-19. We have adjusted our budget for RF
for the year to reflect these factors. RF continues to be
profitable, adding value to the Group as a whole.
Financial Review
Revenue for the period increased to GBP2.389m (H1 2019:
GBP1.547m), benefitting from the inclusion of SCL for Q2. These
numbers were disappointing and were the result of the impacts of
COVID-19. The issue of new equity at the time of the SCL
acquisition strengthened the balance sheet, with net cash of GBP
1.564m at the end of June 2020.
We have continued to invest in our know-how and technical
capability which will support the increasing amount of IHT business
that we will have throughout the coming years.
Our acquisition of SCL was attractively priced and we acquired
the business at a discount to stated net assets, and this gave rise
to a credit to the Group P&L account of GBP1.54m which has
bolstered distributable reserves and net assets accordingly. We
were able to enforce our rights under the acquisition agreement to
have restitution of funds to make good premises and equipment
deficiencies that were agreed post acquisition.
The outcome of the period is that earnings per share are 4.98p (H1 2019: (0.43) p) .
Summary & Outlook
While COVID-19 impacted revenues in the first half of the year,
delaying both the receipt of new orders and the ability to complete
our investment in our production facilities, it was nonetheless a
period of excellent strategic progress, underpinned by a base of
recurring revenues and profit generation in the Advanced PCB
business, incorporating RF. The acquisition of SCL has transformed
our production capabilities, paving the way for IHT production at
scale, while bringing additional expertise and customer base. We
have been pleased with the integration and performance of the
business to date.
Looking ahead, we are confident the recent IHT manufacturing
agreement with a UK manufacturer of EVs will be the catalyst for a
step change in Trackwise's revenue and a solid platform on which to
build. This, alongside the progress we are making elsewhere in the
sector and with partners and prospective customers in medical and
aerospace, clearly illustrates the merits of IHT and its
potential.
While the Company's full year performance will reflect the
difficult economic trading conditions, we expect some improvement
in elements of our Advanced PCB business and the growing pipeline
for IHT gives us confidence in our ability to deliver meaningful
IHT revenue growth in FY21.
The macro-economic backdrop will remain uncertain due to both
Brexit and as the pandemic continues to play out, but Trackwise's
long-term value proposition remains unchanged. We will continue to
carefully monitor and respond to the situation, and supported by
net cash on our balance sheet, a stable customer base and growing
pipeline, we are confident in our ability to deliver on these
growth opportunities as trading conditions normalise.
Interim Condensed Consolidated Statement of Comprehensive
Income
Notes Unaudited Unaudited Audited
Six months Six months Year ended
ended 30 ended 30 31 December
June 2020 June 2019 2019
GBP'000 GBP'000 GBP'000
Revenue 3 2,389 1,547 2 2,906
Cost of sales (1,964) (961) (1,805)
Gross profit 425 586 1,101
Administrative expenses
excluding (790) (518) (900)
exceptional costs and share
based payment - - (28)
(112) (127) (224)
Exceptional severance costs
Share based payment charges
Total administrative expenses (902) (645) (1,152)
Operating loss (477) (59) (51)
Negative goodwill arising
on acquisition 9 1,545 - -
Acquisition expenses 9 (214) - -
Finance income - 4 5
Finance costs (66) (32) (83)
Profit/(loss) before taxation 788 (87) (129)
Taxation 4 133 23 81
Profit/(loss) and total
comprehensive income/(expense)
for the period 921 (64) (48)
------------ ------------- -------------
Earnings per share (pence)
Basic 6 4.98 (0.43) (0.32)
------------ ------------- -------------
Diluted 6 4.82 (0.43) (0.32)
------------ ------------- -------------
Interim Condensed Consolidated Statement of Financial
Position
Notes Unaudited Unaudited Audited
30 June 30 June 31 December
2020 2019 2019
GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Intangible assets 7 5,200 3,389 4,268
Property, plant and
equipment 9 8,363 3,004 2,547
13,563 6,393 6,815
---------- ---------- -------------
Current assets
Inventories 1,740 468 555
Trade and other receivables 1,585 879 1,657
Current tax receivable 448 156 338
Cash and cash equivalents 3,209 1,565 567
---------- ---------- -------------
6,982 3,068 3,117
---------- ---------- -------------
Total assets 20,545 9,461 9,932
---------- ---------- -------------
LIABILITIES
Current liabilities
Trade and other payables (2,210) (1,262) (1,046)
Borrowings (575) (237) (339)
(2,785) (1,499) (1,385)
---------- ---------- -------------
Non-current liabilities
Deferred income - grants (914) (763) (856)
Borrowings 9 (3,640) (999) (1,253)
Provisions (310) - -
Deferred tax liabilities (401) (285) (401)
---------- ---------- -------------
(5,265) (2,047) (2,510)
---------- ---------- -------------
Total liabilities (8,050) (3,546) (3,895)
---------- ---------- -------------
Net assets 12,495 5,915 6,037
---------- ---------- -------------
EQUITY
Share capital 8 885 591 591
Share premium account 8 9,374 4,234 4,234
Retained earnings 2,088 903 1,045
Revaluation reserve 148 187 167
Total equity 12,495 5,915 6,037
---------- ---------- -------------
Interim Condensed Consolidated Statement of Changes in
Equity
Share Share premium Retained Revaluation Total equity
capital account earnings reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2019 591 4,234 840 206 5,871
Loss and total comprehensive
income for the period - - (64) - (64)
Share based payment - - 108 - 108
Revaluation realised in
period - - 19 (19) -
--------- -------------- ---------- ------------ -------------
At 30 June 2019 and 1 July
2019 591 4,234 903 187 5,915
--------- -------------- ---------- ------------ -------------
Profit and total comprehensive
income for the period - - 16 - 16
Share based payment - - 106 - 106
Revaluation realised in
period - - 20 (20) -
At 31 December 2019 and
1 January 2020 591 4,234 1,045 167 6,037
--------- -------------- ---------- ------------ -------------
Profit and total comprehensive
income for the period - - 921 - 921
Issue of shares (net of
GBP439,000 of issue expenses) 294 5,140 - - 5,434
Share based payment - - 103 - 103
Revaluation realised in
period - - 19 (19) -
-------------- ------------
At 30 June 2020 885 9,374 2,088 148 12,495
--------- -------------- ---------- ------------ -------------
Interim Condensed Consolidated Statement of Cash Flows
Unaudited Unaudited Audited
Six months Six months Year ended
ended 30 ended 30 31 December
June 2020 June 2019 2019
GBP'000 GBP'000 GBP'000
Cash flow from operating
activities
Profit/(loss) for the period
before taxation 788 (87) (129)
Adjustment for:
Employee share based payment
charges 112 127 224
Depreciation of property,
plant and equipment 349 127 225
Amortisation of intangible
assets 118 84 183
Negative goodwill credited (1,545) - -
Finance costs 66 28 78
Changes in working capital:
Increase in inventories (314) (88) (175)
Decrease/(increase) in trade
and other receivables 459 (287) (268)
Increase/(decrease) in trade
and other payables 21 257 (496)
--------------- ------------ -------------
Cash generated from operations 54 161 634
Income tax received 420 - 21
--------------- ------------ -------------
Net cash from operating activities 474 161 655
--------------- ------------ -------------
Cash flow from investing
activities
Purchase of property, plant
and equipment (net of new
leases) (359) (47) (951)
Purchase of intangible assets (1,036) (854) (1,736)
Purchase of subsidiary (net (1,629) - -
of cash acquired)
Grant funding - purchase
of intangible assets - 159 175
Interest received - - 5
Net cash used in investing
activities (3,024) (1,238) (2,507)
--------------- ------------ -------------
Cash flow from financing activities
Share capital issued 5,873 - -
Expenses relating to share (439) - -
capital issue
Interest paid (66) (32) (83)
Lease payments (81) - (89)
Repayment of capital element
of lease contracts (95) (112) (195)
------- --------- ---------
Net cash from/(used in) financing
activities 5,192 (144) (367)
------- --------- ---------
Increase/(decrease) in cash
and cash equivalents 2,642 (1,221) (2,219)
------- --------- ---------
Net cash and cash equivalents
at beginning of the period 567 2,786 2,786
Net cash and cash equivalents
at end of period (all cash
balances) 3,209 1,565 567
------- --------- ---------
1. Corporate information
Trackwise Designs plc is a Company incorporated in the United
Kingdom. The registered address of the Company is 1 Ashvale,
Alexandra Way, Ashchurch, Tewkesbury, Gloucestershire, GL20 8NB.
The principal activity of the Company and the Group is the
development, manufacture and sale of printed circuit boards.
2. Accounting policies
Basis of preparation
This unaudited consolidated interim financial information has
been prepared in accordance with IFRS as adopted by the European
Union including IAS 34 'Interim Financial Reporting'. The principal
accounting policies used in preparing the interim results are those
it expects to apply in its financial statements for the year ending
31 December 2020. These are unchanged from those applied in the 31
December 2019 Company financial statements except for the addition
of the application of Group policies which are now relevant
following the acquisition of a material subsidiary from April 2020
and the consolidation of its results and financial position with
those of the Company. In particular, IFRS 3 Business Combinations
and IFRS 10 Consolidated Financial Statements have been
applied.
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 2020 and 30 June 2019 is unreviewed and unaudited and
does not constitute the Group or Company's statutory financial
statements for those periods.
The comparative financial information for the full year ended 31
December 2019 has, however, been derived from the audited statutory
financial statements 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,
did not include references to any matters to which the auditor drew
attention by way of emphasis without qualifying its report and did
not contain a statement under section 498(2)-(3) of the Companies
Act 2006.
The financial information in the Interim Report is presented in
Sterling.
3. Segmental 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 Board of
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. From January 2018 the RF (now
part of Advanced PCB) and IHT activities began to be separately
reviewed and monitored, initially in respect of revenue.
All assets, liabilities and revenues are located in, or derived
in, the United Kingdom. The material assets and liabilities relate
to overall activity with the exception of the intangible
development costs and deferred grants which are solely in respect
of IHT.
In the six months ended 30 June 2020 the Group had two major
customers who each represented 12% of revenue (30 June 2019: two
major customers who represented 11% and 10% of total revenue, and
full year ended 31 December 2019: no major customer representing in
excess of 10% of revenue).
Revenue by product and geographical destination was as
follows:
Unaudited Unaudited Audited
Six months Six months Year ended
ended 30 ended 30 31 December
June 2020 June 2019 2019
GBP'000 GBP'000 GBP'000
IHT 251 547 938
Advanced PCB 2,138 1,000 1,968
--------------- ------------ -------------
2,389 1,547 2,906
--------------- ------------ -------------
UK 1,495 485 1,046
Europe 751 758 1,332
Other 143 304 528
2,389 1,547 2 2,906
--------------- ------------ -------------
4. Income tax
Taxation is provided at the estimated rate of tax for the
period, applying 19% (2019:17%) to deferred tax balances, and
including the benefit of enhanced allowances for research and
development costs.
5. Dividends paid and proposed
No dividends have been paid or proposed in the period ended 30
June 2020 or year ended 31 December 2019.
6. Earnings per share
The calculation of the basic and diluted earnings per share is
based on the following data:
Earnings Unaudited Unaudited Audited
Six months Six months Year ended
ended 30 ended 30 31 December
June 2020 June 2019 2019
GBP'000 GBP'000 GBP'000
Earnings/(loss) for the purpose
of basic and diluted earnings
per share being net profit/(loss)
attributable to the shareholders 921 (64) (48)
--------------- ------------ -------------
Number Number Number
Weighted average number of
ordinary shares for the purposes
of basic earnings per share 18,503,836 14,772,372 14,772,372
Weighted average number of
ordinary shares for the purposes
of diluted earnings per share 19,116,462 14,772,372 14,772,372
Options over 901,909 shares were granted to employees on 15 June
2018 which are still exercisable and potentially dilutive shares
included in the weighted average for the period to 30 June 2020.
The 1,009,000 of additional options issued on 24 June 2020 are not
considered to be dilutive on the period to 30 June 2020.
7. Intangible fixed assets
Development
costs
GBP'000
Cost
At 1 January 2019 2,552
Additions 850
As at 30 June 2019 3,402
Additions 966
As at 31 December 2018 4,368
Additions 1,024
As at 30 June 2020 5,392
------------
Amortisation or impairment
At 1 January 2019 92
Charge 82
As at 30 June 2019 174
Charge 94
As at 31 December 2019 268
Charge 113
As at 30 June 2020 381
------------
Carrying amount
As at 30 June 2019 3,228
------------
As at 31 December 2019 4,100
------------
As at 30 June 2020 5,011
------------
The capitalised development project costs relate to the
significant continuing investment in respect of the Company's
Improved Harness Technology ('IHT') process for unlimited length
printed circuit boards and know-how which is being developed by the
Company with amortisation on the initial development projects
commencing in 2018. The remainder of intangible assets is
represented by software assets and an unchanged amount of goodwill
in respect of the initial technology.
8. Share capital
7,341,250 GBP0.04 ordinary shares were issued on 31 March 2020
at GBP0.80 each for cash in order to provided funds for the
acquisition made in the period and continuing investment in the
business. This increased nominal share capital by GBP294,000 and
share premium by GBP5,579,000. Share issue costs of GBP439,000 were
charged against the share premium account resulting in a net
increase of GBP5,140,000.
9. Acquisition of Stevenage Circuits Ltd
The Company acquired all of the share capital of Stevenage
Circuits Ltd ("SCL"), a UK-based designer and manufacturer of short
flex and rigid printed circuit boards, on 1 April 2020. The
acquisition primarily adds further manufacturing capacity to enable
the demand-led ramp up of Trackwise Design's Improved Harness
Technology production, as well as customers and technical, sales
and operational expertise.
The assets were acquired at a discount to their provisional fair
value resulting in negative goodwill of GBP1,545,000 which has been
credited to the income statement in accordance with IFRS 3 and
represents an exceptional item in the period. This relates to the
ability of the combined Group to fully utilise the manufacturing
capacity of SCL and enhance earnings from the specialist plant and
equipment. The consolidated negative goodwill credit is not
expected to be taxable.
The provisional fair values of the assets and liabilities
acquired are as follows:
Fair value
GBP'000
Property, plant and equipment 2,969
Right of use property assets 1,915
Intangible assets 14
Inventories 872
Trade receivables and prepayments 1,136
Tax 396
Cash 543
Trade and other payables (1,370)
Lease liabilities (1,915)
Hire purchase liabilities (533)
Provisions (310)
3,717
Negative goodwill arising (1,545)
-----------
Consideration was paid in cash and there is no deferred or
contingent consideration payable. Gross trade receivables acquired
were GBP903,000 all of which were expected to be recovered. Right
of use property assets are included in property, plant and
equipment and lease liabilities within borrowings in the
consolidated statement of financial position.
Acquisition related expenses of GBP214,000 have been charged as
an exceptional item in the consolidated income statement. The
negative goodwill and acquisition expenses are both considered
highly material and significant non-recurring items. They are
therefore presented below operating loss in the consolidated income
statement.
SCL has contributed GBP1,224,000 of revenue and incurred a loss
of GBP47,000 included in the consolidated income statement from 1
April 2020 to 30 June 2020 (excluding acquisition expenses and
negative goodwill). Had SCL been consolidated from 1 January 2020
it would have contributed another GBP1,284,000 of revenue and a
loss of GBP23,000 to the six-month period.
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IR KKBBNDBKBCCB
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