Starcom PLC Year End Trading Update (5335O)
10 Fevereiro 2021 - 4:00AM
UK Regulatory
TIDMSTAR
RNS Number : 5335O
Starcom PLC
10 February 2021
This announcement contains inside information for the purposes
of Regulation 11 of the Market Abuse (amendment) (EU Exit)
Regulations 2019/310.
10 February 2021
Starcom PLC
("Starcom" or the "Company")
Year End Trading Update
The Board of Starcom (AIM: STAR), which specialises in the
development of wireless, Internet-Of-Things (IoT) based solutions
for the remote tracking, monitoring and protection of a variety of
assets, is pleased to provide the following trading update for the
year ended 31 December 2020 ("FY 2020") and an update on the
Company's prospects for the current year. The Company expects to
announce its audited results for the year ended 31 December 2020 in
early March 2021.
The results for FY 2020 reflect the global impact of Covid-19 on
the Company. The Company's preliminary unaudited accounts for 2020
show revenue of approximately $5 million (2019: $6.8 million),
gross margin of 33% (2019: 41%) and an adjusted EBITDA* loss of
approximately $350,000 (2019: profit $296,000).
The Company responded promptly to the Covid-19 crisis and
reduced its overheads by approximately 10% compared with 2019.
R&D expenses, however, were only reduced by a small amount to
maintain investment and development in the Company's technologies.
Margins were impacted by costs of amortisation and high logistics
and shipment costs as a result of the pandemic, as capacity was
reduced. As announced previously, due to the disruption caused by
the pandemic, many of the Company's customers were unable to place
orders and make payments as expected in 2020. The final results for
FY2020 will therefore include appropriate provisions in respect of
delays in payments by some customers who could not meet their
obligations to Starcom.
The Company has been successful in securing a low-cost long-term
bank loan as well as government grants to mitigate the effects of
the pandemic, and the resulting and unexpected cashflow
pressure.
It is encouraging to see that, even in such a challenging year,
the Company could still rely on its strong and loyal customer base
to generate $2.2 million of SaaS revenues, an increase of
approximately 9% compared to the previous year. Although hardware
sales were severely depressed by the pandemic at $2.8 million, the
newer and higher margin products - Kylos, Tetis and Lokies - still
represented 40% of hardware sales. This included the second
production batch of Lokies, which were well received by the
customers.
Even during the long lock-down periods, the Company continued to
maintain and further develop Starcom's strategic alliances and
pipeline of potential projects. For example, work with Zero
Motorcycles ("Zero") progressed during 2020 to ensure Starcom's
technology can support Zero's new generation of motorcycles.
The Company is hoping to benefit from the new opportunities that
the global vaccination effort presents within the logistics
industry, most significantly, the need to monitor the temperature
and other conditions of vaccines whilst in transit. The Company is
already involved in discussions with two potential customers who
provide vaccine logistics services.
Avi Hartmann, CEO of Starcom, commented, "I am pleased with the
way Starcom has been able to cope with the impact of the pandemic.
We have adjusted our costs quickly, secured financial resources to
ensure business continuity, and in parallel, focused on retaining
our key assets, mainly our solid client base and pipeline of future
opportunities. I am particularly proud of our recurring SaaS
revenues that grew this year despite the pandemic. I remain
optimistic about Starcom's ability to return to growth as the
market returns to normality."
*Adjusted EBITDA is earnings before interest, tax, depreciation,
and amortization and excluding one-off charges and share based
payments.
-ends-
For further information please contact:
Starcom Plc
Michael Rosenberg, Chairman 07785 727595
Avi Hartmann, CEO +972 5477 35663
Allenby Capital Limited (Nominated Adviser
and Joint Broker)
Jeremy Porter/Asha Chotai 020 3328 5656
------------------
Peterhouse Capital Limited (Joint Broker)
Lucy Williams/Charles Goodfellow/Eran Zucker 020 7469 0930
------------------
Leander PR (Financial PR)
Christian Taylor-Wilkinson 07795 168 157
------------------
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END
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