TIDMXSG
RNS Number : 2873K
Xeros Technology Group plc
20 September 2016
20 September 2016
Xeros Technology Group plc
Major progress in developing and commercialising platform
technology
Xeros Technology Group plc (AIM: XSG, 'the Group', 'Xeros'), the
developer and provider of patented polymer bead systems with
multiple commercial applications, publishes its second unaudited
interim results for the six months ended 30 June 2016.
Highlights
Platform technology
-- Possess disruptive bead technology platform which can be
deployed in numerous global markets
-- Good progress in application areas creating considerable
interest from industry leaders with capacity for scaling up
adoption
Laundry
-- Earned income up to GBP807,000 (comparative period 2015: GBP325,000)
-- Commercial Laundry:
o 116 commercial washing machines installed (comparative period
2015: 50) bringing total estate to 278
o In advanced discussions with industry leaders to increase
growth rate
-- Consumer Laundry:
o Major strides in fabric care and extended garment life
o Detailed evaluation of domestic technology being carried out
by global OEM
Leather
-- Six successful scale trials with leading European tannery
-- Trials confirmed significant savings in water, chemistry and effluent
-- Business plan formulated to introduce technology in up to five tanneries in 2017
New applications
-- Detailed studies completed - two soft and one hard substrate
-- IP development and applications underway including new bead
formulations with the capacity to further reduce chemistry
consumption
-- Ambition is to achieve successful scale trials in each of the areas by end 2018
Mark Nichols, Chief Executive of Xeros, said:
"It's now clear that we have a disruptive bead technology
platform that can be commercialised across a range of global
industries.
"In Commercial Laundry, we are increasingly accepted in a
customer segment which has the capacity for thousands of machine
installations. We are in detailed discussions with a number of
leading market participants, and we are confident of achieving an
annual installation rate of 2,000 per annum in the year of
2020.
"We have developed a low risk pathway to establishing our
washing and cleaning technology for use by end consumers. A global
OEM is currently evaluating the benefits of our technology.
"The pace of our Leather Processing trials in conjunction with
our development partners, Wollsdorf Leder Schmidt ("Wollsdorf") in
Austria and LANXESS, has accelerated ahead of our own expectations.
We aim to achieve large scale commercialisation by the end of
2018.
"We have selected three new application areas for development,
which we expect to have the same commercial potential as Laundry
and Leather Processing. Whilst there is a great deal of R&D and
engineering work to be done, we have set our teams the task of
achieving successful scale trials in each of these three new areas
by the end of 2018."
Enquiries:
Xeros Technology Group plc Tel: 0114 321
Mark Nichols, Chief Executive 6328
Officer
Jefferies International Limited Tel: 020 7029
(Nominated Adviser and Joint Broker) 8000
Simon Hardy / Harry Nicholas
Berenberg (Joint Broker) Tel: 020 3207
Chris Bowman / Ben Wright / Amritha 7800
Murali
Instinctif Partners Tel: 020 7457
Adrian Duffield / Helen Tarbet 2020
/ James Gray
Notes to Editors
Xeros Technology Group plc (LN: XSG) is a platform technology
company that is reinventing water intensive industrial and
commercial processes by replacing water with polymer bead
technologies. Its patented technologies have the capacity to
provide material economic, operational and sustainability
improvements that are unachievable with traditional processes. The
Group first applied its technology in the commercial laundry market
in advance of developing a system for use in the home.
Subsequently, it has demonstrated its technology in the leather
processing industry and its R&D teams are developing a number
of additional applications for other water intensive industrial and
commercial markets. The Group joined AIM in 2014 and in December
2015 raised gross proceeds of GBP40m by way of a placing to
accelerate the commercialisation of its innovative technology
across global laundry markets and to further develop its patented
technology for other identified industrial and domestic
processes.
For more information, please visit -
http://www.xeroscleaning.com/
Strategic overview
Our strategy remains to deploy Xeros' polymer bead platform
technology across a number of water intensive processes, which it
has the ability to fundamentally transform.
We continue to accumulate firm evidence that the technology is
able to reduce cost in a number of scale processes in global
industries whilst radically improving quality and sustainability
outcomes.
Funds raised last December are now being deployed across a
balanced portfolio of developments - Laundry, Leather Processing
and New Applications - with focussed resources now dedicated to
each of these areas.
Laundry
We continue to make progress in the Commercial Laundry market
with an increasing number of installations with customers who have
the potential to deploy large numbers of our machines - 116 in the
period bringing the estate to 278. 77% of machines sold in the
period were sold through a lease arrangement, the "Complete"
contract, with the remainder bought outright by the customer under
the "Perform" contract.
Having exceeded our targets for bringing on board Forward
Channel Partners ("FCPs"), we are now focussing on developing a
number of them to the point where they provide all the services
that our customers require including marketing, sales, service and
the commissioning of machines once they have been installed.
Customer satisfaction levels have remained above 90% for the
year to date. Our smaller 16Kg machine has now entered the field
with trial customers allowing us to increase the penetration of the
hospitality and UK markets in particular. Discussions are ongoing
with global OEMs to distribute machines incorporating Xeros
technology and to provide Sbeadycare services on a multi-national
basis.
As a consequence of the increasing interest in the Xeros
proposition across the entire United States, the business' ability
to commission machines has not kept pace with the rate at which
machines have been installed. We are increasing our internal
resources and systems significantly to close this gap pending the
training of local FCPs to undertake the commissioning activity. The
outcome will be to minimise the time between installation and
income being booked, and to minimise working capital.
Since the beginning of the year, we have also been focussing on
the steps we need to take to get our technology broadly deployed
with in the home. We are currently involved in detailed discussions
and evaluations with a global domestic appliance OEM with a view to
it developing a machine which incorporates our technology.
In order to stimulate consumer demand and awareness in the
interim, we plan to introduce a service which we will pilot in the
US in 2017, whereby consumers can outsource the cleaning to Xeros
of some of their highly valued but hard to wash items. Our
proposition is based upon extensive market research which tells us
that consumers currently value highly fabric care and garment life
extension over cost savings and sustainability. Xeros delivers
outstanding performance against each of these criteria. We believe
that outsourced, on-demand cleaning has the capacity to become a
business in its own right and we will continue to study its
potential up to and through our pilot programme.
Leather Processing
Xeros has successfully completed six full scale trials in
Austria with our development partner, Wollsdorf, who were awarded
Tannery of the year for 2014 by World Leather Magazine.
Five of the trials were in the retanning and dyeing phase where
we achieved reductions in water consumption by approximately 60%
and effluent mass by around 50%. We also reduced chemistry
consumption by a material amount.
Early indications are that the results of the sixth trial in the
upstream tanning phase are similarly positive. We believe the
results that we have achieved in the Wollsdorf tannery are
transformational for the industry at large, delivering significant
cost and much needed environmental benefits.
The total leather market is estimated to be GBP50bn per annum
with the bovine segment accounting for GBP42bn, of which GBP3bn is
spent on chemistry and GBP193m on water(1) . The application of our
technology within this industry does not require wholesale process
change and its adoption is well within the capabilities of most
tanneries. The costs of adoption of Xeros' technology are recovered
by tanneries in relatively short order from the benefits they
accrue. Also, our technology does not displace competitors and
market resistance should be low as a result.
We have agreed in principle with LANXESS to continue our
co-operation and that they remain our leather chemical supplier of
choice including for formulation know-how and new formulations
which have the capacity to bring additional benefits to the
industry.
We now have a team of 15 in Leather Processing and we expect
first revenues in early 2017. Following this we anticipate growing
the business to one of significant scale over the coming years,
with up to five tanneries targeted to adopt our technology in
2017.
New applications
Following a review of in excess of 100 potential applications
ideas and a structured analysis of water intensive processes, we
have selected three specific applications for further R&D
within the Xeros Technology Centre in Sheffield.
Two of the developments are on soft flexible substrates with the
third being a hard substrate: a first for the Company with Laundry
and Leather Processing classified as soft. We consider all three
new areas to have scientific and engineering aspects in common with
our work and experience in Laundry and Leather, which should make
for a shorter development lifecycle.
We are developing intellectual property strategies for these
three applications and are beginning to make important patent
applications in key areas. Whilst much work needs to be completed,
we are targeting scale trials for the new applications by the end
of 2018.
Work continues on our next generation of polymer beads with the
aim of using them as a carrier for specific chemistries taking them
directly to the surface of substrates and in so doing, reducing yet
again the amount of chemistry used in processes.
Organisation
We have greatly increased the capacity of the organisation with
specialist teams now dedicated to specific lines of business or
development areas. Our Commercial Laundry engineering function is
now consolidated within the Engineering Centre in Seekonk,
Massachusetts, which has freed up resources and facilities in the
Xeros Technology Centre for work on our new applications. In light
of this, we will be providing segmental reporting for Leather,
Laundry and New Applications in our year end accounts.
Summary and Outlook
We continue to make excellent progress on our growth
commercialisation strategies.
We have continued to drive and develop the Commercial Laundry
business and are confident of achieving our 2020 targets. We are in
advanced discussions with a number of industry partners to speed up
market penetration and returns. We have a plan to penetrate the
Consumer Laundry market in what we believe is an achievable series
of steps.
Scale trials in Leather Processing have yielded results ahead of
our expectations and we are now prosecuting our plan to penetrate
this market.
With the path forward clear, we are now focussing on the rapid
execution of our plans. Over the longer term, the opportunity for
our technology to be adopted within, and fundamentally change,
global industries is highly significant.
Our aim is to maximise the deployment of our platform technology
using commercialisation partners once market acceptance is
achieved, thereby minimising the time and capital intensity
required to generate significant returns on our disruptive
innovations.
Notes:
1. DLP Advisors report (commissioned by Xeros)
Financial review
Group earned income was generated as follows:
Unaudited Unaudited
6 months 6 months Year ended
to to
30 June 30 June 31 July
2016 2015 2015
GBP'000 GBP'000 GBP'000
Machine sales 509 213 289
Service income 271 104 177
Lease interest income 27 8 14
______ ______ _______
Total earned income 807 325 480
Group earned income increased by 148% to GBP807,000 in the six
months ended 30 June 2016 when compared to the comparative period
(30 June 2015: GBP325,000).
Notably, service income from the installed base of Commercial
Laundry machines has increased significantly during the six months
ended 30 June 2016, to more than 2.5 times the service income
generated in the comparative period.
The point at which revenue and costs from machine sales can be
recognised is dependent on the completion of a number of stages.
These include the installation of the machine, commissioning of the
machine, acceptance of the machine by the customer, completion of
utility incentive formalities, where applicable, and then, in the
case of lease sales, finalisation of the lease agreement. The Group
does not recognise revenue and costs from a machine sale until all
of these aspects are complete.
The number of machines installed in the period is as
follows:
6 months 6 months Year ended
to to
30 June 30 June 31 July
2016 2015 2015
No. No. No.
Machines sold - revenue
and costs taken to P&L
statement 30 12 16
Machines commissioned
and generating service
revenue, but machine sale
revenues and costs not
yet recognised 14 20 32
Machines installed but
not yet commissioned 72 18 34
Machines installed in
the period 116 50 82
The installed estate of machines at the end of the period is as
follows:
30 June 30 June 31 July
2016 2015 2015
No. No. No.
Machines sold 97 38 40
Machines commissioned 56 25 32
Machines installed 125 24 34
Machines estate at the
end of the period 278 87 106
Until a machine is sold it remains in inventory. At 30 June 2016
there were 181 installed machines in stock (30 June 2015: 49
machines) and, as a consequence, inventory levels have increased as
at 30 June 2016.
As at 30 June 2016 contracted future service revenues amount to
GBP3.2m (30 June 2015: GBP1.0m) and average contract length is 73
months (30 June 2015: 74 months).
Adjusted gross margin improved to GBP160,000 (19.8%) from
GBP46,000 (14.2%) in the six months ended 30 June 2015. Sales and
service margins continue to be in line with expectations.
The Group has continued to invest in its R&D programme. The
Group spent GBP2.7m on R&D including staff and patent costs
(six months ended 30 June 2015: GBP1.9m) alongside the Commercial
Laundry working capital and start-up costs, in line with the
Board's expectations. This has resulted in an Adjusted EBITDA loss
of GBP7.4m, increased from a loss of GBP5.6m in the comparative
period.
The continuing strength of the US$ means that working capital
and start-up costs in the US Commercial Laundry business are
proportionally more expensive when translated into Sterling, the
Group's functional currency. However, a strong US$ will benefit the
Group financial statements as the US business grows to generate
cash and become profitable. As at 30 June 2016 the Group had
forward contracts to buy US$17.1m at favourable exchange rates, as
a consequence of exchange rate risk management of costs to be
incurred by the US Commercial Laundry business, put in place before
the vote on Brexit. The weakness of Sterling since the vote on
Brexit has resulted in a GBP0.9m gain on these forward contracts as
at 30 June 2016. This unrealised gain has been taken to the
consolidated statement of profit and loss, through the Finance
income line, and has been recognised in current assets.
The Group reported a loss after tax of GBP6.1m (six months ended
30 June 2015: GBP5.5m). The loss per share decreased to 7.18p from
8.33p in the 6 months ended 30 June 2015.
The Group expects cash utilisation to continue to accelerate
over the coming years, as we continue to fund our R&D programme
alongside the roll-out in Commercial Laundry and to start the
commercialisation in Leather Processing. The increase in net cash
outflow from operations to GBP10.4m (six months ended 30 June 2015:
GBP6.4m) reflects these activities and was in line with the Board's
expectations. The Group had existing cash resources as at 30 June
2016 of GBP39.4m (30 June 2015: GBP17.5m) and remains debt
free.
The Group has tax losses of approximately GBP26.1m to offset
against future taxable profits (30 June 2015: GBP18.0m). No
deferred tax asset has been recognised at this stage due to the
uncertainty of future profits to offset these losses against.
Accounting reference date change
Historically the Group was predominantly a research and
development business with strong university and academic links. A
31 July year end was therefore consistent with the business as it
then was. The Group has changed its accounting reference date to 31
December, primarily to bring it into line with a more conventional
commercial company reporting timeframe, consistent with the
development of its commercial operations, in order to provide ease
of reference for investors, customers, managers and employees.
The effect of the change to the accounting reference date is to
extend the current accounting period to 31 December 2016, a period
of more than 15 months. In accordance with Rule 18 of the AIM
Rules, therefore, the Company has prepared these unaudited results
for the six months to 30 June 2016, has announced unaudited results
for the 5 months to 31 December 2015, and will announce audited
results for the 17 month period to 31 December 2016no later than 18
May 2017
The Group will subsequently publish its half-yearly reports to
30 June and annual audited accounts to 31 December in accordance
with the AIM Rules for Companies.
Consolidated statement of profit or loss and other comprehensive
income
For the six months ended 30 June 2016
Unaudited Unaudited
Six months Six months Year
ended ended ended
30 June 30 June 31 July
2016 2015 2015
Note GBP'000 GBP'000 GBP'000
----------------------------------- ----- ----------- ----------- ---------
Earned income 807 325 480
Less: lease interest income (27) (8) (14)
----------------------------------- ----- ----------- ----------- ---------
Revenue 780 317 466
Cost of sales (647) (279) (399)
_______ _______ _______
Gross profit 133 38 67
----------------------------------- ----- ----------- ----------- ---------
Lease interest income 27 8 14
_______ _______ _______
Adjusted gross margin 160 46 81
----------------------------------- ----- ----------- ----------- ---------
Administrative expenses (8,334) (6,054) (11,102)
Other operating income - - 174
Adjusted EBITDA* (7,434) (5,554) (9,868)
Share-based payment expense (654) (426) (916)
Depreciation of tangible
fixed assets (113) (36) (77)
----------------------------------- ----- ----------- ----------- ---------
Operating loss (8,201) (6,016) (10,861)
Finance income 1,153 94 192
_______ _______ _______
Loss before taxation (7,048) (5,922) (10,669)
Taxation 3 917 472 464
_______ _______ _______
Loss after tax (6,131) (5,450) (10,205)
_______ _______ _______
Other comprehensive income
Items that are or maybe
reclassified to profit
or loss:
Foreign currency translation
differences - foreign operations (551) 91 16
_______ _______ _______
Total comprehensive expense
for the period (6,682) (5,359) (10,189)
_______ _______ _______
Loss per ordinary share
Basic and diluted on loss
from continuing operations 5 (7.18)p (8.33)p (15.62)p
_______ _______ _______
(*) Adjusted EBITDA comprises loss on ordinary activities before
interest, tax, share-based payment expense, depreciation and
amortisation.
Consolidated statement of changes in equity
For the six months ended 30 June 2016
Foreign
currency Retained
Share Share Merger translation earnings
capital premium reserve reserve deficit Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 31 July 2014 98 28,132 15,443 (38) (13,137) 30,498
Loss for the
period - - - - (3,837) (3,837)
Other comprehensive
expense - - - (37) - (37)
--------------------- --------- --------- --------- ------------- ---------- --------
Loss and total
comprehensive
expense for the
period - - - (37) (3,837) (3,874)
Transactions
with Owners of
the Company:
Share based payment
expense - - - - 189 189
--------------------- --------- --------- --------- ------------- ---------- --------
At 31 December
2014 98 28,132 15,443 (75) (16,785) 26,813
--------------------- --------- --------- --------- ------------- ---------- --------
Loss for the
period - - - - (5,450) (5,450)
Other comprehensive
expense - - - 91 - 91
--------------------- --------- --------- --------- ------------- ---------- --------
Loss and total
comprehensive
expense for the
period - - - 91 (5,450) (5,359)
Transactions
with Owners of
the Company:
Issue of shares - 46 - - - 46
Share based payment
expense - - - - 425 425
--------------------- --------- --------- --------- ------------- ---------- --------
At 30 June 2015 98 28,178 15,443 16 (21,810) 21,925
--------------------- --------- --------- --------- ------------- ---------- --------
Loss for the
period - - - - (918) (918)
Other comprehensive
expense - - - (38) - (38)
--------------------- --------- --------- --------- ------------- ---------- --------
Loss and total
comprehensive
expense for the
period - - - (38) (918) (956)
Transactions
with Owners of
the Company:
Share based payment
expense - - - - 302 302
--------------------- --------- --------- --------- ------------- ---------- --------
At 31 July 2015 98 28,178 15,443 (22) (22,426) 21,271
--------------------- --------- --------- --------- ------------- ---------- --------
Loss for the
period - - - - (5,613) (5,613)
Other comprehensive
expense - - - (71) - (71)
--------------------- --------- --------- --------- ------------- ---------- --------
Loss and total
comprehensive
expense for the
period - - - (71) (5,613) (5,684)
Transactions
with Owners of
the Company:
Issue of shares 27 39,992 - - - 40,019
Costs of share
issues (2,153) - - - (2,153)
Share based payment
expense - - - - 141 141
--------------------- --------- --------- --------- ------------- ---------- --------
At 31 December
2015 125 66,017 15,443 (93) (27,898) 53,594
--------------------- --------- --------- --------- ------------- ---------- --------
Loss for the
period - - - - (6,131) (6,131)
Other comprehensive
expense - - - (551) - (551)
--------------------- --------- --------- --------- ------------- ---------- --------
Loss and total
comprehensive
expense for the
period - - - (551) (6,131) (6,682)
Transactions
with Owners of
the Company:
Issue of shares 4 262 - - - 266
Share based payment
expense - - - - 654 654
--------------------- --------- --------- --------- ------------- ---------- --------
At 30 June 2016 129 66,279 15,443 (644) (33,375) 47,832
--------------------- --------- --------- --------- ------------- ---------- --------
Consolidated statement of financial position
As at 30 June 2016
Unaudited Unaudited
30 June 30 June 31 July
2016 2015 2015
GBP'000 GBP'000 GBP'000
------------------------------ ---------- ---------- ---------
Assets
Non-current assets
Property, plant and
equipment 889 168 577
Trade and other receivables 1,295 342 363
------------------------------ ---------- ---------- ---------
2,184 510 940
------------------------------ ---------- ---------- ---------
Current assets
Inventories 5,389 2,188 2,909
Trade and other receivables 1,905 975 578
Current tax asset 807 477 477
FX Gain 900 - -
Investments - bank deposits 21,553 1,538 1,539
Cash and cash equivalents 17,870 17,468 15,913
------------------------------ ---------- ---------- ---------
48,424 22,646 21,416
------------------------------ ---------- ---------- ---------
Total assets 50,608 23,156 22,356
------------------------------ ---------- ---------- ---------
Liabilities
Non-current liabilities
Deferred tax (22) (17) (22)
Current liabilities
Trade and other payables (2,754) (1,214) (1,063)
Total liabilities (2,776) (1,231) (1,085)
------------------------------ ---------- ---------- ---------
Net assets 47,832 21,925 21,271
------------------------------ ---------- ---------- ---------
Equity
Share capital 129 98 98
Share premium 66,279 28,178 28,178
Merger reserve 15,443 15,443 15,443
Foreign currency translation
reserve (644) 16 (22)
Accumulated losses (33,375) (21,810) (22,426)
------------------------------ ---------- ---------- ---------
Total equity 47,832 21,925 21,271
------------------------------ ---------- ---------- ---------
Consolidated statement of cash flows
For the six months ended 30 June 2016
Unaudited Unaudited
6 months to 6 months to Year ended
30 June 30 June 31 July
2016 2015 2015
GBP000 GBP000 GBP000
--------------------------------------------------------------------------- ------------ ------------ -----------
Operating activities
Loss before tax (7,048) (5,922) (10,669)
Adjustment for non-cash items:
Depreciation of property, plant and equipment 113 36 77
Share based payment 654 426 916
Increase in inventories (302) (228) (2,110)
Increase in trade and other receivables (1,395) (637) (90)
(Decrease)/increase in trade and other payables (1,351) 67 288
Finance income (1,153) (94) (192)
Cash used in operations (10,482) (6,352) (11,780)
Taxes refunded/(paid) 110 (5) (8)
Net cash outflow used in operations (10,372) (6,357) (11,788)
--------------------------------------------------------------------------- ------------ ------------ -----------
Investing activities
Finance income 253 94 192
Cash withdrawn from/(placed on) deposits with more than 3 months maturity 9,992 (6) (13)
Purchases of property, plant and equipment (271) (40) (532)
--------------------------------------------------------------------------- ------------ ------------ -----------
Net cash inflow/(outflow) from investing activities 9,974 48 (353)
--------------------------------------------------------------------------- ------------ ------------ -----------
Financing activities
Proceeds from issue of share capital, net of costs 266 46 46
Net cash inflow from financing activities 266 46 46
--------------------------------------------------------------------------- ------------ ------------ -----------
Increase/(decrease) in cash and cash equivalents (132) (6,263) (12,095)
Cash and cash equivalents at start of year 17,961 23,733 27,999
Effect of exchange rate fluctuations on cash held 41 (2) 9
Cash and cash equivalents at end of the period 17,870 17,468 15,913
--------------------------------------------------------------------------- ------------ ------------ -----------
Notes to the financial statements
For the six months ended 30 June 2016
1. General information
The principal activity of Xeros Technology Group plc ("the
Company") and its subsidiary companies (together "Xeros" or the
"Group") is the development and commercialisation of patented
polymer bead systems with multiple potential commercial
applications.
Xeros Technology Group plc is domiciled in the UK and
incorporated in England and Wales (registered number 8684474), and
its registered office address is Unit 2 Evolution, Advanced
Manufacturing Park, Whittle Way, Catcliffe, Rotherham, S60 5BL. The
Company's principal activity is that of a holding company.
The interim financial information was approved for issue on 19
September 2016.
2. Basis of preparation
The interim financial information has been prepared under the
historical cost convention, except for the fair valuation of
derivatives, and in accordance with the recognition and measurement
requirements of International Financial Reporting Standards
("IFRS") as adopted by the European Union, IFRIC interpretations,
and with those parts of the Companies Act 2006 applicable to
companies reporting under IFRS.
The interim financial information has been prepared on a going
concern basis and is presented in Sterling to the nearest
GBP'000.
The accounting policies used in the preparation of the interim
financial information are consistent with those set out in the
audited financial statements for the year ended 31 July 2015.
Further IFRS standards or interpretations may be issued that could
apply to the Group's financial statements for the period ending 31
December 2016. If any such amendments, new standards or
interpretations are issued then these may require the financial
information provided in this report to be changed. The Group will
continue to review its accounting policies in the light of emerging
industry consensus on the practical application of IFRS.
The preparation of financial information in conformity with the
recognition and measurement requirements of IFRS requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and
expenses during the reporting period. Although these estimates are
based on management's best knowledge of the amount, event or
actions, actual events ultimately may differ from those
estimates.
The interim financial information does not include all financial
risk management information and disclosures required in annual
financial statements. There have been no significant changes in any
risk or risk management policies since 31 July 2015. The principal
risks and uncertainties are largely unchanged and are as disclosed
in the Annual Report for the year ended 31 July 2015.
The interim financial information for the six months ended 30
June 2016 and for the six months ended 30 June 2015 do not
constitute statutory financial statements as defined in Section 434
of the Companies Act 2006 and is unaudited. The comparative figures
for the year ended 31 July 2015 are not the Group's consolidated
statutory accounts for that financial year. Those accounts have
been reported on by the Group's auditor and delivered to the
Registrar of Companies. The report of the auditor was (i)
unqualified, (ii) did not include a reference to any matters to
which the auditor drew attention by way of emphasis without
qualifying their report, and (iii) did not contain a statement
under Sections 498(2) or 498(3) of the Companies Act 2006.
3. Taxation
Unaudited Unaudited
6 months 6 months
to to Year ended
30 June 30 June 31 July
2016 2015 2015
GBP'000 GBP'000 GBP'000
Current tax:
Foreign taxes paid 6 5 8
R & D tax credits (923) (477) (477)
Deferred tax charge - 5
Total tax charge/(credit) (917) (472) (464)
-------------------------- --------- --------- ----------
As at 30 June 2016 the Group had tax losses of approximately
GBP26.1m to offset against future taxable profits (30 June 2015:
GBP18.0m, 31 December 2015, GBP24.1m, 31 July 2015: GBP18.7m). The
Group has not recognised these losses as a deferred tax asset in
the consolidated statement of financial position due to the
uncertainty in the timing of its crystallisation.
4. Segmental analysis
The Group currently has one operating segment. Revenue and
losses arising from that segment are the same as presented on the
face of the consolidated statement of profit or loss and other
comprehensive income.
5. Loss per share
Basic loss per share is calculated by dividing the loss
attributable to equity holders by the weighted average number of
shares in issue during the period. The Group was loss-making for
the periods ended 30 June 2016 and 30 June 2015 and also for the 5
months to 31 December 2015 and the year ended 31 July 2015.
Therefore, the dilutive effect of share options has not been taken
account of in the calculation of diluted earnings per share, since
this would decrease the loss per share reported for each of the
periods reported.
The calculation of basic and diluted loss per ordinary share is
based on the loss for the period, as set out below.
Loss Weighted Loss
for the average per
number
period of share
shares
GBP'000 in issue (pence)
Six months ended 30 June
2016 (6,131) 85,377,365 (7.18)p
Six months ended 30 June
2015 (5,450) 65,442,740 (8.33)p
Five months ended 31 December
2015 (5,613) 67,015,596 (8.38)p
Year ended 31 July 2015 (10,205) 65,336,459 (15.62)p
------------------------------ -------- ---------- --------
The weighted average number of shares in issue throughout the
period is as follows:
6 months 6 months
to to Year ended
30 June 30 June 31 July
2016 2015 2015
Number of Number of Number of
shares shares shares
Issued ordinary shares
at beginning of period 83,403,990 65,173,549 65,173,549
Effect of shares
issued for cash during
the period 1,973,375 269,191 162,910
Weighted average
number of shares
for the period 85,377,365 65,442,740 65,336,459
------------------------ ---------- ---------- ----------
6. Details of events occurring after the reporting period
There were no events occurring after the reporting period.
7. Seasonality
The Group experiences no material variations due to
seasonality.
8. Availability of interim statement
This interim statement will be available on Xeros' website at
www.xeroscleaning.com.
Forward-looking statements
This announcement may include certain forward-looking
statements, beliefs or opinions, including statements with respect
to Xeros' business, financial condition and results of operations.
These forward-looking statements can be identified by the use of
forward-looking terminology, including the terms "believes",
"estimates", "plans", "anticipates", "targets", "aims",
"continues", "expects", "intends", "hopes", "may", "will", "would",
"could" or "should" or, in each case, their negative or other
various or comparable terminology. These statements are made by the
Xeros Directors in good faith based on the information available to
them at the date of this announcement and reflect the Xeros
Directors' beliefs and expectations. By their nature these
statements involve risk and uncertainty because they relate to
events and depend on circumstances that may or may not occur in the
future. A number of factors could cause actual results and
developments to differ materially from those expressed or implied
by the forward-looking statements, including, without limitation,
developments in the global economy, changes in government policies,
spending and procurement methodologies, and failure in health,
safety or environmental policies.
No representation or warranty is made that any of these
statements or forecasts will come to pass or that any forecast
results will be achieved. Forward-looking statements speak only as
at the date of this announcement and Xeros and its advisers
expressly disclaim any obligations or undertaking to release any
update of, or revisions to, any forward-looking statements in this
announcement. No statement in the announcement is intended to be,
or intended to be construed as, a profit forecast or to be
interpreted to mean that earnings per Xeros share for the current
or future financial years will necessarily match or exceed the
historical earnings. As a result, you are cautioned not to place
any undue reliance on such forward-looking statements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR LMMATMBITMMF
(END) Dow Jones Newswires
September 20, 2016 02:01 ET (06:01 GMT)
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