TIDMVRS
RNS Number : 1857L
Versarien PLC
12 May 2022
12 May 2022
Versarien Plc
("Versarien", the "Company" or the "Group")
Interim Results for the twelve months ended 31 March 2022
Versarien Plc (AIM: VRS), the advanced engineering materials
group, is pleased to announce its unaudited interim results for the
twelve months ended 31 March 2022. As announced on 24 February
2022, the Company's accounting reference date has changed from 31
March to 30 September.
Financial Highlights
-- Group revenues from continuing operations up 34% to GBP7.63
million (2021: GBP5.69 million)*
-- Graphene revenues up 170% to GBP1.89 million (2021: GBP0.70
million)
-- Adjusted LBITDA** for continuing operations reduced by 45% to
GBP1.04 million (2021: GBP1.88 million)
-- Reported loss before tax from continuing operations of GBP5.14
million (2021: GBP8.08 million)
-- Reported loss for the period of GBP5.20 million (2021: GBP8.07
million)
-- Cash of GBP3.10 million at 31 March 2022 (31 March 2021: GBP2.36
million)
*Excludes discontinued revenues of GBP0.53 million (2021:
GBP0.88 million)
**Adjusted LBITDA (Loss Before Interest, Tax, Depreciation and
Amortisation) excludes Exceptional items, Share-based payment
charges and Other losses)
Operational/Manufacturing Highlights
-- Relocation to new dedicated graphene production facility in
Longhope, Gloucestershire to significantly expand capacity
-- 10,000 square foot floor slab laid for new Versarien innovation
centre using the Company's Cementene(TM) and Polygrene(TM) enhanced
concrete
-- Acquisition of Spanish graphene manufacturing assets transferred
to Longhope during the year and in process of commissioning
to provide up to an additional 100 tonne powder capacity per
annum
-- Equipment to scale up graphene ink production capacity by an
additional 12,000 litres per annum delivered and commissioned
Partnerships/Commercialisation Highlights
-- Commercial agreement signed with Superdry to produce graphene
enhanced garments and discussions ongoing with multiple other
garment suppliers
-- Grant agreement signed and project completed to support the
development of Pseudo-Capacitor technology aimed at zero emissions
for port-side infrastructure
-- Successful on-time delivery of Defence Science and Technology
Laboratory ("DSTL") contract within specification
-- Royalty agreement signed with Gerdau S.A. for the distribution
of graphene masks primarily in Latin America
-- Collaboration signed with US-based Flux Footwear LLC, an adaptive
footwear company, to supply graphene enhanced elastomers
-- Launch of 3D printed concrete "Lunar" lifestyle pods using Cementene(TM),
Versarien's graphene-enhanced cement
Funding Highlights
-- GBP1.93 million strategic investment in Versarien by GrapheneLab
Co. Ltd., South Korea, together with royalty and trademark agreements
Post Period Highlights
-- Sports brand Umbro has announced it will integrate Versarien's
Graphene-Wear(TM) technology into its " Elite Pro-Training Kit"
range for the spring/summer collection 2023
-- GoToGym in South America are launching active-wear incorporating
Versarien's Graphene-Wear(TM) technology
Neill Ricketts, CEO of Versarien, commented:
"The period has seen the financial benefits of the DSTL contract
focussed on understanding the benefits that graphene-loaded
materials may bring to defence applications with Group revenues
from continuing operations up 34% and reported losses significantly
reduced. Alongside the expansion of our production facilities in
Longhope we continue to progress the applications in which graphene
can be used with a view to launching new graphene enhanced products
over the coming months. This is a natural follow on from the
successful finalisation of the DSTL contract and the near
completion of the GSCALE development projects.
"In parallel, customer testing continues to prove successful and
we are seeing increased interest from global companies in signing
development agreements that may, in time, lead to significant
future revenues whilst at the same time we are looking to expand
our global footprint and enter into agreements with the right
strategic partners for the business, in part helped by having
passed the accreditation of the Graphene Council."
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED
UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014
WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL)
ACT 2018, AS AMED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A
REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO
BE IN THE PUBLIC DOMAIN
For further information please contact:
Versarien Plc
Neill Ricketts - Chief Executive Officer +44 (0) 1594 887204
Chris Leigh - Chief Financial Officer
Dr Stephen Hodge - Chief Technology Officer
SP Angel Corporate Finance (Nominated Adviser
and Joint Broker)
Matthew Johnson
Ewan Leggat
Adam Cowl +44 (0) 20 3470 0470
Berenberg (Joint Broker)
Mark Whitmore
Ciaran Walsh +44 (0) 20 3207 7800
IFC Advisory Limited (Financial PR & Investor
Relations)
Tim Metcalfe
Zach Cohen +44 (0) 20 3934 6630
Notes to Editors:
The strategy of Versarien Plc (AIM:VRS) is to be a globally
recognised graphene company with a wide portfolio of high-quality
verified materials allied to the largest relevant IP portfolio
supported by its own UK based research and development centre
driving recurring revenue growth through its innovative graphene
product applications.
For further information please see: http://www.versarien.com
Chair's Statement
I am pleased to provide this, my first statement as
Non-executive Chair of Versarien, relating to the first twelve
months of the extended 18-month accounting period. In the interim
report for the first six months we stated that we would be
concentrating our graphene activities on the construction and
textile sectors, utilising our ability to help improve the
environment by using graphene to reduce CO(2) emissions, reduce
weight and improve recycling.
We continue to expand our production capability at Longhope,
Gloucestershire, and develop our international footprint and
product portfolio with the objective of being a global player in
the graphene market. At the same time monetisation of the
technology remains a priority and the progress made since my
appointment a few months ago is pleasing to see.
We are engaging with a number of international textile brands to
launch garments in the coming seasons and have launched our
Graphene-Wear(TM) website to showcase what can be achieved.
Cementene(TM) , our graphene admixture, has been used in a
number of concrete pours, providing validation for the technology.
The next stage will be to obtain the necessary accreditations to
allow full-scale commercialisation, a process which is
underway.
Whilst we focus on our objective of monetisation it is also
vital that we maintain a pipeline of development opportunities that
will provide future revenues. Global packaging companies are now
showing increased interest in how graphene can aid sustainability
and development agreements are in place. Participating in the UK's
Digital Roads for the Future programme also affords greater
opportunities in UK infrastructure projects.
In concluding, whilst we are pleased with the progress made we
cannot ignore the fact that the pandemic and recent macro-economic
events have provided a challenging environment, especially as we
have a global footprint to our operations. Whilst these factors
have delayed certain near-term projects, it has not affected our
objectives and we remain acutely aware of our shareholder's
expectations.
I would like to thank all our staff for their continued
endeavours and very much look forward to reporting further
progress.
Diane Savory OBE
Non-executive Chair
Chief Executive Officer's Review
I am pleased to report on the progress that the Group has made,
particularly in pursuit of solutions to the environmental
challenges we all face. Reducing CO(2) emissions, light-weighting,
electrification and recycling are all matters where Versarien's
advanced material technology can play a significant role.
The DSTL contract has been successfully delivered and we are
having ongoing dialogue with the UK defence sector. The development
work under the GSCALE project is nearing completion, and under the
terms of the Innovate UK loan the next two years will be focussed
on commercialising the developed technology. Monetisation of this
and Versarien's portfolio of other opportunities remains the focus
both in the UK and globally. The highlights of our recent progress
are set out below.
Construction:
The global construction industry is one of the biggest
contributors to CO(2) production, accounting for c.39% of energy
and process-related carbon dioxide emissions with concrete alone
contributing c.8% of the world's CO(2) emissions. A small amount of
graphene added to concrete can offer a way of significantly
reducing CO(2) emissions, as well as increasing the strength and
durability of the concrete, whilst reducing costs through less
labour and steel. With the UK and EU objectives of drastically
reducing carbon emissions by 2030 and for Europe to be a carbon
neutral continent by 2050, the development of Cementene(TM) and
Polygrene(TM) products provides a valuable societal and economic
benefit.
The global ready-mix concrete market is forecast to reach
US$1,375bn by 2028 and it is estimated that the global market for
graphene included in cement could be approximately GBP900 million
per annum by 2030. Obtaining a significant share of that market is
a primary focus for us. At our facilities at Longhope we conducted
a 10,000 square foot pouring of our graphene-enhanced concrete for
the Company's new innovation centre. The graphene-enhanced
polypropylene fibres eliminated the need for steel rebar, thereby
reducing costs and CO(2) emissions.
We have also demonstrated the efficiency of using 3D printed
graphene enhanced cement with the production of the Lunar Pod, a 3D
printed graphene enhanced concrete dwelling which has uses from
garden offices to humanitarian shelters. The Lunar Pod was designed
to showcase our technology and since its launch has proved to be a
valuable marketing tool.
Having demonstrated the technical viability of our graphene
enhanced cement, the next stage is to gain the required
accreditations under BS EN 8500. Further internal testing is
underway to meet BS EN 934-2.
Textiles/footwear and leisure-wear:
Further to previous announcements regarding the collaboration
with a prominent global sports and fashion wear manufacturer, the
customer, Umbro, has confirmed, post period end, that they will
launch a range of graphene-enhanced garments as part of their Elite
Pro-Training Kit range which will be available for sale in the
spring/summer collection in 2023. The garments will be available in
several countries around the world and will feature the Versarien
Graphene-Wear(TM) technology and trademark.
Following a period of collaboration, our strategic partner in
South America, GoToGym (a venture capital backed business), is
launching a new range of active wear garments featuring Versarien's
Graphene-Wear(TM) technology and trademark. GoToGym is working with
retail partners in North and South America with the garments to be
manufactured in Brazil.
Following delays caused by the Covid pandemic in Sri Lanka, we
are working with our partner MAS Holdings on a number of projects,
which involve the commercial team, MAS Active, and the development
team at Twinery, Innovations by MAS. The projects are a result of
further development work carried out at The Royal College of Arts
(Textile Division) which was able to further develop the printed
graphene ink technology in both ink designs and different fabric
compositions.
We are pushing forward with applying our Graphene-Wear (TM) ink
technology to Superdry's core fabrics that will be used to create
garments for a 2023 launch. Print trials are underway with their
supply chain partners and once completed, it will scale up into
production. We will be looking to establish a trademark licence
royalty agreement for the products sold which we expect to be a
framework for future projects with the company.
We are working closely with a niche fabric and garment
manufacturer with capabilities here in the UK and the Middle East.
We will be applying our Graphene-Wear(TM) ink technology to a range
of their fabrics for them to manufacture sportswear garments. They
will be selling these garments to their UK customers and also into
the Middle East where the company has established teamwear and
retail supply channels.
We have developed several Graphene-Wear (TM) rubber compounds
with our customers, one of which has been used to create the
outsole component of the Flux AdaptMid athletic shoe. Flux has
completed the prototyping stage and the shoes are ready for mass
production. Versarien is offering the first 500 pairs off the
production line in the autumn-winter 2022 season for the UK market
(available for pre-order now). Flux will be placing the shoe on
sale in the USA market immediately following this. We will be
receiving a trademark licence royalty on each pair sold.
We have supplied an initial 20kg of our Graphene-Wear(TM) rubber
compound to a major UK apparel manufacturer for them to mould into
prototype outsoles and outsole inserts, that they will be testing
for performance parameters.
We have launched our Graphene-Wear (TM) website
https://graphene-wear.com to showcase the technologies that we
offer. Alongside this, the Company's recently published white paper
shows the scientific validation behind our technology and offers
data points for our customers to view and assess.
We have been working with Inspecs Group to develop graphene
enhanced eyewear products that improve frame strength and
durability with initial technical tests proving successful. Rollout
is anticipated in 2023 and further information will be announced in
due course.
The graphene market for the textiles and footwear sector is
estimated to be approximately GBP400 million per annum by 2030 and
consequently this sector remains a high priority for Versarien.
Automotive
There are significant weight, structural and cost-saving
benefits to using graphene-enhanced carbon fibre reinforced
polymers (CFRP) in the automotive sector particularly with regard
to vehicle weight reduction which improves range for electric
vehicles and fuel consumption for internal combustion engined
vehicles.
As stated in the first interim report for the period, the Lotus
Evija bonnet was successfully developed as part of the Technology
Developer Accelerator Programme and further development will
continue as the parties look at optimisation of the process for use
in any body panel. This, together with the results of the DSTL
project are enabling further light-weighting development, including
a new bio-based resin with a reduced carbon footprint.
Graphene also has the potential to enhance the performance of
tyres. It can reduce the rolling resistance that, in turn,
increases the fuel efficiency of the vehicle or, in the case of an
EV, offer increased range.
We are now coming to the end of the initial lab scale tests for
Enso Tyres, with. the next step to repeat the most promising lab
scale tests with a second independent test house to ensure we have
robust test data to base any future prototype tyres upon.
The graphene market in the automotive sector is forecast to be
GBP300 million per annum by 2030, so continues to be a focus for
Versarien.
Aerospace
Graphene applications in the aerospace industry remain in the
early stages of research with light-weighting, fire retardancy, ice
protection systems, lightning strike protection and electrification
among the applications currently being explored.
We are at month 24 of 42 in the SpearHead 10 GICE project led by
Airbus, with a return to face-to-face meetings following Covid
restrictions. Versarien has been developing graphene heater mats to
be integrated into several aircraft demonstrators and has had the
technology validated to Technology Readiness Level 3 ("TRL")
(Airbus internal TRL scale 1-6). These heater mats are due to be
integrated into the various aero foil structures and have been
through preliminary icing wind tunnel testing prior to a
comprehensive icing wind tunnel campaign later this year.
Within the Graphene Flagship, Versarien is also working with
SpearHead 11 project SafeGraph, with the graphene heater mats a
case study for understanding the Lifecycle Analysis (LCA) and
exposure to nanomaterials during the various stages - e.g. graphene
production, heater mat manufacture and integration, during
operation and at end-of-life.
Steve Hodge, the Company's CTO, also maintains an active role as
part of the Graphene Flagship's ECHA-REACH working group.
The graphene aerospace market is estimated to be approximately
GBP70 million per annum by 2030 so continues to be a focus for the
Company.
DSTL Contract
The Company contracted with the UK's Defence Science and
Technology Laboratory (DSTL) in 2020 to undertake a package of work
to better understand the benefits that graphene-loaded materials
may bring to defence applications. This project completed
successfully on schedule by 31 March 2022 with the delivery of
demonstrators in two areas of application with some final reports
to be delivered post-period end. The manufacture of the
demonstrators has been proven to be a realistic practical
undertaking utilising the materials developed on the project.
One of the project work streams involved military bridging,
where a quarter scale bridge designed by Versarien was modelled
using finite element analysis (FEA) and manufactured from
graphene-enhanced carbon fibre polymer composite with minimal
metallic elements. The bridge underwent rigorous mechanical testing
to validate FEA models and will be housed at our Longhope
facility.
Exploitation plans have been developed and there is now ongoing
discussion with DSTL and industry OEMs to explore and capture
exploitation opportunities in the short, medium and long terms. The
project was a first for the Company and while it has delivered on
its technical requirements, the fruitful and constructive
relationship that has now been developed with DSTL has put the
Company on a firm footing for future engagements with the UK
defence sector.
United States of America
We continue to make good progress in the US market, adding new
customers, signing new NDAs, entering into new projects, and
selling samples. Our long-term relationships are moving towards
monetisation with Rust-Oleum, (a coatings company), having now
completed long term corrosion testing. We have performed companion
electrical corrosion testing in our UK labs, and the results are
good. The material is expected to be used in "professional grade"
corrosion inhibiting primer as soon as Versarien Graphene Inc.
attains the appropriate certification.
We have received our first order for sample material from NASA
where our graphene will be investigated for space-craft coating
applications. We are also working with a major fabric and yarn
manufacturer to include Versarien's graphene in ballistic
protection, stab resistant, flame retardant and abrasion resistant
garments as well as a high-end bicycle chain lubrication
manufacturer where Versarien's graphene materials have performed
exceptionally well in preliminary tests.
Interest is being shown by various US universities in
understanding more about Cementene(TM) with a view to including us
in their customer led concrete projects where significant US
Government funding for infrastructure is in place.
South Korea
Good progress has been made at Versarien Korea Limited ("VKL")
where strong partnerships have been forged with academic and
industrial partners. The core focus has been on chemical vapour
deposition ("CVD") growth optimisation with a portfolio of CVD
graphene products on different substrates to be launched pending
independent testing through the Graphene Flagship's
characterisation services. VKL is also looking at opportunities to
sell Versarien Graphene Limited's Cementene(TM) and
Graphene-Wear(TM) products in Korea .
South America
Graphene enhanced masks for COVID protection continue to be of
interest to the Brazilian market where the licence agreement with
Gerdau providing a royalty. Gerdau is currently going through the
process of getting the masks cleared by the Brazilian Health
Authorities after their initial order of 270,000 units.
Mature Businesses
Trading conditions for the mature businesses have improved over
the last 12 months, but nonetheless remain challenging. Revenues
were up 15% to GBP5.74 million (2021: GBP4.98 million), broadly the
same in each half, but pressure on margins has resulted in a small
loss for the 12 months.
Current trading and outlook
Trading in the current period has started satisfactorily with
order books at the mature businesses showing signs of improvement.
Our primary focus remains on the opportunities we see in the
construction and textile/leisure sectors where the potential
graphene markets are significant and within which we are moving
towards commercial product sales at the fastest rate. I look
forward to reporting further progress in due course.
Neill Ricketts
Chief Executive Officer
Chief Technology Officer's Review
The Innovate UK GSCALE programme has been running for over 18
months with the GBP5 million loan supporting Versarien in advancing
its graphene manufacturing capabilities, progressing research and
development of new graphene enhanced materials, with the primary
focus on commercial exploitation. This work is now largely complete
and now the focus will be on monetising the technology.
We have joined the Digital Roads of the Future (DRF) Partnership
which has two funding streams in place. The first being Digital
Roads, an GBP8.6 million project sponsored by the Engineering and
Physical Sciences Research Council, Costain, National Highways, the
University of Cambridge; and the second being Future Roads, a
GBP5.8 million project sponsored by 2020 Marie Sk odowska-Curie
Actions COFUND (a European funding initiative), Costain and
National Highways. Being a partner in this programme offers
Versarien the ability to become an active player in a GBP14.5
million programme over five years, developing direct links to
National Highways (formerly Highways England), developing stronger
links with a major international Tier 1 construction company,
Costain, gaining funded support for graphene material and
technology development, and delivering UK wide projects with
graphene materials and technologies on the road network.
We have excellent relationships with both the University of
Cambridge and Costain and by using our graphene admixture for
cementitious materials, Cementene(TM) , we can offer significant
advantages to new concrete material structures including
approximate 20% cost savings on ground bearing slab, reduction of
CO(2) emissions of up to 50%, use up to 30% less material
(reduction in thickness), removal/ significant reduction in steel
rebar requirements, no visible or microscopic cracking and highly
workable concrete.
We are in phase 2 of a development programme for graphene-based
packaging applications for a European based multi-national food
products company. Similar interest is being shown by the leading
global packaging and paper producer in Brazil with a development
contract also now in place. The objective is to improve
sustainability as well as cost effective performance.
In Spain, Gnanomat continues to upgrade its pilot plant and
manufacturing capabilities as part of the INNPRESSME project. It
has also signed a research contract with a global petrochemical
company to evaluate the use of metal oxide/activated carbon black
nanocomposites, inter alia, in active anode materials of lithium
ion batteries. It is making advances in its biocide materials
whilst developing prototypes for energy storage and developing new
ink formulations in conjunction with Cambridge Graphene. Gnanomat
materials have been utilised in the SUPPORTIVE project by 2-DTech
and two supercapacitor products have been developed with associated
datasheets. We are engaging with UK cell manufacturers to take
forward optimised devices.
Dr Stephen Hodge
Chief Technology Officer
Chief Financial Officer's review
As stated in previous reports, the aluminium business based at
Cheltenham has now ceased and consequently these results are split
between continuing and discontinued operations and the segmental
analysis between the technology and mature businesses. Details of
the discontinued operations are given in note 2 and include some
additional minor revenues and costs in the run-off period since the
last interim report.
The revenue from the continuing businesses increased by 34% to
GBP7.63 million up from GBP5.69 million. Revenue from graphene,
including that recognised under the DSTL contract, was up 170% to
GBP1.89 million from GBP0.70 million in the comparative period of
which DSTL accounted for GBP1.47 million (2021: GBP 0.25
million).
The loss from continuing operations was GBP4.74 million (2021:
GBP7.93 million). This was after charging GBP1.15 million in
respect of the valuation of the Lanstead Sharing Agreements (2021:
GBP3.28 million).
The adjusted LBITDA for continuing operations was GBP1.04million
compared to GBP1.88 million, an improvement of 45%, calculated as
follows:
12 months ended 12 months ended
31 March 2022 31 March 2021
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Continuing Discontinued TOTAL Continuing Discontinued TOTAL
operations operations operations operations
------------------------------ ----------- ------------ ------- ----------- ------------ -------
(Loss)/profit from
operations (4,738) (130) (4,868) (7,930) 22 (7,908)
Depreciation and Amortisation 1,396 41 1,437 1,135 98 1,233
Share based payments 1,156 - 1,156 1,193 - 1,193
Exceptional items - 64 64 441 - 441
Other losses 1,148 - 1,148 3,280 - 3,280
------------------------------ ----------- ------------ ------- ----------- ------------ -------
Adjusted LBITDA (1,038) (25) (1,063) (1,881) 120 (1,761)
------------------------------ ----------- ------------ ------- ----------- ------------ -------
The reported loss before tax for continuing operations was
GBP5.14 million (2021: GBP8.08 million). Group net assets at 31
March 2022 were GBP14.4 million (31 March 2021: GBP16.5 million)
with cash at the period end of GBP3.1 million (31 March 2021:
GBP2.4 million).
Net cash used in operating activities was GBP2.15 million (2021:
GBP0.89 million) with trade and other payables reducing by GBP1.2
million as the HMRC Covid payment plans unwound and trade creditor
payment terms returned to normal. Investment in development costs
and equipment was GBP3.57 million (2021: GBP1.68 million) and net
principal lease payments were GBP0.63 million (2021: GBP0.99
million) giving total cash outflows of GBP6.35 million (2021:
GBP3.56 million).
These activities were financed by net funds received from the
Lanstead sharing agreements of GBP3.17 million (2021: GBP2.34
million), net loans received of GBP2.10 million (2021: GBP2.45
million) and net funds received from the share issue to GrapheneLab
Co Ltd. of GBP1.90 million (2021: GBPNil) totalling GBP7.17 million
(2021: GBP4.79 million).
The surplus of GBP0.82 million (2021: GBP1.23 million) resulted
in reduced drawings on the invoice finance facilities of GBP0.08
million (2021: GBP0.53 million) thus increasing cash at the
period-end by GBP0.74 million (2021: GBP0.70 million). As we
progress our GSCALE project we continue to draw on the GBP5 million
Innovate UK loan facility, repayment of which is due to commence in
2024.
The mature business segment, whilst seeing increased revenues,
has incurred a loss of GBP0.1 million; however the current order
books are showing encouraging signs of improvement.
Chris Leigh
Chief Financial Officer
Consolidated Interim Financial Statements
Group statement of comprehensive income
For the 12 months ended 31 March 2022
31 March 31 March
2022 2021
Unaudited Audited
Restated***
GBP'000 GBP'000
Notes
Continuing operations
Revenue 3 7,633 5,685
Cost of sales (5,179) (4,498)
--------------------------------------------- ----- ---------- ------------
Gross profit 2,454 1,187
Other operating income 195 103
Other losses* (1,148) (3,280)
Operating expenses (including exceptional
items) (6,239) (5,940)
--------------------------------------------- ----- ---------- ------------
Loss from operations before exceptional
items (4,738) (7,489)
Exceptional items 4 - (441)
--------------------------------------------- ----- ---------- ------------
Loss from operations (4,738) (7,930)
Finance charge (398) (148)
--------------------------------------------- ----- ---------- ------------
Loss before income tax (5,136) (8,078)
Income Tax 5 81 -
--------------------------------------------- ----- ---------- ------------
Loss from continuing operations (5,055) (8,078)
(Loss)/profit from discontinued operations** 2 (141) 10
--------------------------------------------- ----- ---------- ------------
Loss for the period (5,196) (8,068)
--------------------------------------------- ----- ---------- ------------
Loss attributable to:
- Owners of the parent company (5,083) (7,779)
- Non-controlling interest (113) (289)
--------------------------------------------- ----- ---------- ------------
(5,196) (8,068)
--------------------------------------------- ----- ---------- ------------
Loss per share attributable to the equity
holders of the Company:
Basic and diluted loss per share 6 (2.62)p (4.45)p
--------------------------------------------- ----- ---------- ------------
There is no other comprehensive income for the year.
* The other losses in the period relates to the fair value
assessment of the Lanstead sharing agreements at the balance sheet
date.
** Details of the components of the discontinued operations are
given in note 2.
*** The audited results have been restated in accordance with
the required disclosure of discontinued operations.
Group statement of financial position
As at 31 March 2022
31 March 31 March
2022 2021
Unaudited Audited
Note GBP'000 GBP'000
Assets
Non-current assets
Intangible Assets 7 11,555 9,706
Property, plant and equipment 4,673 4,119
Deferred taxation 25 25
Trade and other receivables 38 772
---------------------------------------------------- ---- ---------- --------
16,291 14,622
---------------------------------------------------- ---- ---------- --------
Current assets
Inventory 1,901 1,814
Trade and other receivables 2,558 6,449
Cash and cash equivalents 3,095 2,359
---------------------------------------------------- ---- ---------- --------
7,554 10,622
---------------------------------------------------- ---- ---------- --------
Total assets 23,845 25,244
---------------------------------------------------- ---- ---------- --------
Equity
Called up share capital 1,941 1,899
Share premium 34,948 33,003
Merger reserve 1,256 1,256
Share-based payment reserve 4,405 3,249
Accumulated losses (26,708) (21,625)
---------------------------------------------------- ---- ---------- --------
Equity attributable to owners of the parent company 15,842 17,782
Non-controlling interest (1,401) (1,288)
---------------------------------------------------- ---- ---------- --------
Total equity 14,441 16,494
---------------------------------------------------- ---- ---------- --------
Liabilities
Non-current liabilities
Trade and other payables 1,187 1,222
Deferred taxation 67 67
Innovate Loan 4,371 2,260
Long-term borrowings 396 356
---------------------------------------------------- ---- ---------- --------
6,021 3,905
---------------------------------------------------- ---- ---------- --------
Current liabilities
Trade and other payables 2,532 3,748
Provisions 53 119
Invoice discounting advances 549 631
Current portion of long-term borrowings 249 347
---------------------------------------------------- ---- ---------- --------
3,383 4,845
---------------------------------------------------- ---- ---------- --------
Total liabilities 9,404 8,750
---------------------------------------------------- ---- ---------- --------
Total equity and liabilities 23,845 25,244
---------------------------------------------------- ---- ---------- --------
Group statement of changes in equity
For 12 months ended 31 March 2022
Share Share-based Non-
Share premium Merger payment Accumulated controlling Total
capital account reserve reserve losses interest equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- -------- -------- -------- ----------- ----------- ------------ --------
At 1 April 2020 (audited) 1,697 25,497 1,256 2,056 (13,846) (999) 15,661
Issue of shares 202 7,506 - - - - 7,708
Loss for the year - - - - (7,779) (289) (8,068)
Share-based payments - - - 1,193 - - 1,193
----------------------------- -------- -------- -------- ----------- ----------- ------------ --------
At 31 March 2021 (audited) 1,899 33,003 1,256 3,249 (21,625) (1,288) 16,494
Issue of shares 42 1,945 - - - - 1,987
Loss for the period - - - - (5,083) (113) (5,196)
Share-based payments - - - 1,156 - - 1,156
----------------------------- -------- -------- -------- ----------- ----------- ------------ --------
At 31 March 2022 (unaudited) 1,941 34,948 1,256 4,405 (26,708) (1,401) 14,441
----------------------------- -------- -------- -------- ----------- ----------- ------------ --------
Included within the merger reserve is GBP53,000 in respect of
the merger with Versarien Technologies Limited (now Versarien
Graphene Limited) and GBP964,000 in respect of the acquisition of
Total Carbide Limited and GBP239,000 in respect of the acquisition
of AAC Cyroma Limited.
Statement of Group cash flows
For the 12 months ended 31 March 2022
12 months
ended Year ended
31 March 31 March
2022 2021
Unaudited Audited
GBP'000 GBP'000
--------------------------------------------- ---------- ------------
Cash flows from operating activities
Cash used in operations (1,911) (734)
Interest paid (242) (160)
--------------------------------------------- ---------- ------------
Net cash used in operating activities (2,153) (894)
--------------------------------------------- ---------- ------------
Cash flows from investing activities
Purchase/capitalisation of intangible assets (2,190) (1,638)
Purchase of property, plant and equipment (1,377) (42)
--------------------------------------------- ---------- ------------
Net cash used in investing activities (3,567) (1,680)
--------------------------------------------- ---------- ------------
Cash flows from financing activities
Share issue 1,926 -
Share issue costs (23) (134)
Funds received from Innovate UK 2,111 2,260
Funds received from sharing agreements 3,171 2,479
Net funds (paid)/received from CBILS (13) 186
Principal payment of leases under IFRS 16 (634) (990)
Net invoice discounting advances (82) (525)
--------------------------------------------- ---------- ------------
Net cash generated from financing activities 6,456 3,276
--------------------------------------------- ---------- ------------
Increase in cash and cash equivalents 736 702
Cash and cash equivalents at start of period 2,359 1,657
--------------------------------------------- ---------- ------------
Cash and cash equivalents at end of period 3,095 2,359
--------------------------------------------- ---------- ------------
Note to the statement of Group cash flows
For the 12 months ended 31 March 2022
12 months
ended Year ended
31 March 31 March
2022 2021
Unaudited Audited
GBP'000 GBP'000
--------------------------------------------------- ---------- ------------
Loss before income tax (5,277) (8,068)
Adjustments for:
Share-based payments 1,156 1,193
Depreciation 1,096 1,081
Amortisation 341 152
Disposal of tangible assets 86 -
Finance cost 409 160
R&D Tax credit received 81 -
Loss on FV movement of share agreement 1,148 3,280
Increase/(Decrease) in trade and other receivables
and investments 306 (211)
(Increase)/Decrease in inventories (87) 438
(Decrease)/Increase in trade and other payables (1,170) 1,241
--------------------------------------------------- ---------- ------------
Cash used in operations (1,911) (734)
--------------------------------------------------- ---------- ------------
Discontinued operations 12months Year ended
ended 31 March
31 March 2021
2022 Unaudited
Unaudited GBP'000
GBP'000
-------------------------------------------------------- ----------------- ----------
Net cash generated/(used) in operating activities 122 34
Net cash used in investing activities (3) -
Net cash generated/(used) from financing activities (118) (37)
-------------------------------------------------------- ----------------- ----------
Increase in cash and cash equivalents from discontinued
operations 1 (3)
-------------------------------------------------------- ----------------- ----------
Notes to the unaudited interim statements
For the 12 months ended 31 March 2022
1. Basis of preparation
Versarien Plc is an AIM quoted company incorporated and
domiciled in the United Kingdom under the Companies Act 2006. The
Company's registered office is Units 1A-D, Longhope Business Park,
Monmouth Road, Longhope, Gloucestershire, GL17 0QZ.
The interim financial statements were prepared by the Directors
and approved for issue on 12 May 2022. These interim financial
statements do not comprise statutory accounts within the meaning of
section 434 of the Companies Act 2006. Statutory accounts for the
year ended 31 March 2021 were approved by the Board of Directors on
16 August 2021 and delivered to the Registrar of Companies. The
report of the auditors on those accounts was unqualified and did
not contain statements under sections 498 (2) or (3) of the
Companies Act 2006.
As permitted, these interim financial statements have been
prepared in accordance with UK AIM Rules and UK-adopted IAS 34,
"Interim Financial Reporting". They should be read in conjunction
with the annual financial statements for the year ended 31 March
2021, which have been prepared in accordance with UK-adopted
international accounting standards, consistent with the IFRS
framework adopted in UK law. The accounting policies applied are
consistent with those of the annual financial statements for the
year ended 31 March 2021, as described in those annual financial
statements. Where new standards or amendments to existing standards
have become effective during the year, there has been no material
impact on the net assets or results of the Group.
These interim financial statements have been prepared on a going
concern basis making the following assumptions:
-- The Group meets its day-to-day working capital requirements
through careful cash management and the use of its invoice discounting
facilities which are expected to continue;
-- As at 31 March 2022, the Group had cash balances totalling GBP3.10
million with GBP0.44 million of headroom on its invoice discounting
facilities;
-- The Group was awarded a GBP5 million loan by Innovate UK to
fund certain of its activities, of which GBP0.6 million remains
to be drawn;
-- The Group receives monthly settlements from its sharing agreements
with Lanstead, the quantum of which is dependent upon share
price; but which will cease in July;
-- The Group has unused authority to issue 29 million shares without
pre-emption rights until the next AGM due by 30 September 2022
and expects the placing authority to be renewed; and
-- That there are a number of mitigating actions the Group could
implement, such as reducing the funds spent on development of
its technologies and overheads to concentrate solely on GSCALE
commercial opportunities.
The Directors have prepared detailed projections of expected
future cash flows for a period of twelve months from the date of
issue of this interim statement. These indicate that the Group will
need to raise additional funding in the following financial year. T
he Board remains confident that the Group will be able to secure
the required funding through strategic investment, equity issue or
other financial instruments. However, the timing and availability
of funding sources is currently outside of the control of the Board
and none of this funding is committed at the date of these interim
statements. Whilst noting this, the Directors continue to adopt the
going concern basis in preparing the consolidated financial
statements.
Certain statements within this report are forward looking. The
expectations reflected in these statements are considered
reasonable. However, no assurance can be given that they are
correct. As these statements involve risks and uncertainties the
actual results may differ materially from those expressed or
implied by these statements. The interim financial statements have
not been audited.
2. Discontinued operations
On 5 August, within the preliminary results statement, the Group
announced its decision to exit the non-core aluminium business of
Versarien Technologies Limited based in Cheltenham. The company has
been re-named Versarien Graphene Limited and will be used as the
revenue generating entity for UK graphene sales whilst 2-DTech
Limited and Cambridge Graphene Limited will continue as the UK
research and development arms of the graphene business. Financial
information relating to the discontinued operation is set out
below.
12 months Year ended
ended 31 March
31 March 2022 2021
Unaudited Unaudited
Notes GBP'000 GBP'000
Revenue 3 534 882
Cost of sales (427) (614)
------------------------------------------ ----- -------------- ------------
Gross profit 107 268
Other operating income 1 4
Operating expenses (including exceptional
items) (238) (250)
------------------------------------------ ----- -------------- ------------
Profit from operations before exceptional
items (66) 22
Exceptional items 4 (64) -
------------------------------------------ ----- -------------- ------------
(Loss)/Profit from operations (130) 22
Finance charge (11) (12)
------------------------------------------ ----- -------------- ------------
Profit before income tax (141) 10
Income Tax 5 - -
------------------------------------------ ----- -------------- ------------
Profit from discontinued operations (141) 10
------------------------------------------ ----- -------------- ------------
3. Segmental information
The segment analysis for the twelve months to 31 March 2022 is
as follows:
Central Technology Mature Discontinued Intra-group TOTAL
Businesses Businesses Operations Adjustments
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue - 1,891 5,742 534 - 8,167
Gross Margin - 933 1,521 107 - 2,561
Other gains/(losses) (1,148) - - - - (1,148)
Other operating
income - 191 4 1 - 196
Operating expenses (2,041) (2,672) (1,552) (238) 26 (6,477)
(Loss)/ profit
from operations (3,189) (1,548) (27) (130) 26 (4,868)
Finance income/(charge) (283) (41) (74) (11) - (409)
(Loss)/profit
before tax (3,472) (1,589) (101) (141) 26 (5,277)
The segment analysis for the twelve months to 31 March 2021 is
as follows:
Central Technology Mature Discontinued Intra-group TOTAL
Businesses Businesses Operations Adjustments
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue - 703 4,982 882 - 6,567
Gross Margin - 91 1,096 268 - 1,455
Other gains/(losses) (3,280) - - - - (3,280)
Other operating
income - 103 - 4 - 107
Operating expenses (2,686) (1,638) (1,584) (250) (32) (6,190)
(Loss)/ profit
from operations (5,966) (1,444) (488) 22 (32) (7,908)
Finance income/(charge) (44) (33) (71) (12) - (160)
(Loss)/profit
before tax (6,010) (1,477) (559) 10 (32) (8,068)
4. Exceptional items
12 months 12 months
ended ended
31 March 31 March
2021 2021
Unaudited Audited
GBP'000 GBP'000
------------------------------------ ---------- ---------
Continuing operations :
------------------------------------ ---------- ---------
Relocation and restructuring costs - 53
Costs relating to expansion in Asia - 137
Acquisition costs - 186
Other - 65
------------------------------------ ---------- ---------
- 441
------------------------------------ ---------- ---------
Discontinued operations:
------------------------------------ ---------- ---------
Relocation and restructuring costs 64 -
------------------------------------ ---------- ---------
64 -
------------------------------------ ---------- ---------
5. Taxation
The tax charge on the results for the period has been estimated
at GBPnil (2021: GBPnil). At the last year end the Group had GBP
19.4 million of trading losses carried forward to set-off against
future trading profits. Taxation received in the year relates to
R&D tax credit.
6. Loss per share
The loss per share has been calculated by dividing the loss
after taxation of GBP5,083,000 (2021: GBP7,779,000) by the weighted
average number of shares in issue of 193,997,352 (2021:
174,660,000) during the period.
The calculation of the diluted earnings per share is based on
the basic earnings per share adjusted to allow for the issue of
shares on the assumed conversion of all dilutive options. However,
in accordance with IAS33 "Earnings per Share", potential Ordinary
shares are only considered dilutive when their conversion would
decrease the profit per share or increase the loss per share. As at
31 March 2022 there were 14,677,130 (2021: 14,677,130) potential
Ordinary shares that have been disregarded in the calculation of
diluted earnings per share as they were considered non-dilutive at
that date.
7. Intangible assets
31 March 31 March
2022 2021
Unaudited Audited
GBP'000 GBP'000
----------------------------- ---------- --------
Goodwill 3,555 3,555
Customer relationships/order
books - 27
Development costs 4,535 2,453
Licence 48 58
Intellectual property 3,417 3,613
----------------------------- ---------- --------
Total 11,555 9,706
----------------------------- ---------- --------
8. Dividends
As stated in the 2013 AIM Admission document, the Board's
objective is to continue to grow the Group's business and it is
expected that any surplus cash resources will, in the short to
medium term, be re-invested into the research and development of
the Group's products. Consequently, the Directors will not be
recommending a dividend for the foreseeable future. However, the
Board intends that the Company will recommend or declare dividends
at some future date once they consider it commercially prudent for
the Company to do so, bearing in mind its financial position and
the capital resources required for its development.
9. Interim Report
This interim announcement is available on the Group's website at
www.versarien.com
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END
IR GPUAPAUPPGRG
(END) Dow Jones Newswires
May 12, 2022 02:01 ET (06:01 GMT)
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