TIDMTRT
RNS Number : 2718R
Transense Technologies PLC
05 July 2022
Transense Technologies plc
("Transense" or the "Company")
Year End Trading Update
Transense Technologies plc (AIM: TRT), the developer of
specialist sensor systems, is pleased to provide a trading update
for the financial year ended 30 June 2022 based on unaudited
management information.
Highlights
-- Results for the year in line with market expectations
-- Strong royalty and sales revenue growth
-- Progress in product and business development across all divisions
-- Cash balanced maintained, despite spending circa GBP0.30m on
a share buyback programme - and with the next quarterly royalty
payment of not less than GBP0.43m due in July
-- Resilient business model leads to Board confidence in growth prospects
Revenue, EBITDA & Cash
Revenue for the year has increased by almost 50% to around
GBP2.6m, which is line with market expectations. Adjusted EBITDA*
is also expected to be in line with market expectations, and net
earnings may exceed market expectations as a consequence of an
increased tax credit arising from extending the recognition of
deferred tax assets arising from prior years' losses.
Net cash balances at 30 June 2022 amounted to GBP1.05m (FY21:
GBP1.04m). Trading was cash generative and the Company invested
approximately GBP0.30m in the share buyback programme announced in
February 2022. Royalties for the final quarter of the financial
year, receivable at the end of July 2022, are expected to be not
less than GBP0.43m, further strengthening the available cash
position of the Company.
iTrack Royalties
The underlying royalty income for the financial year from iTrack
increased by more than 75% compared with the prior year, reaching
US$2m. Royalty income is denominated in US dollars, which has
strengthened against Sterling during the year to a level slightly
more favourable than the exchange prevailing at the outset of the
licence in June 2020. The run rate of royalty income now exceeds
GBP1.85m per annum at current exchange rates, representing an
almost threefold increase since inception of the deal.
Surface Acoustic Wave (SAW)
Revenues were above those of the prior year, primarily due to
the sale of torque management systems for motor sport applications
and technical support on pre-production projects, including for the
GE T901 engine programme. In addition, the Company began to realise
income from claims under the Technology Developer Accelerator
Programme ("TDAP") grant announced in May 2022, which could in
total amount to GBP0.13m by the end of FY23.
Business development activities have been expanded and continue
to generate positive responses. The feedback obtained affirms
potential demand for SAW technology across a broad range of
applications, including torque and temperature measurement to
improve the control and efficiency of electric motor drive units.
This in turn has led the Company to commit additional engineering
resource, with key appointments including the new Technical
Director announced recently. Costs attributable to the SAW business
have been contained within budgets set out in the Company's
internal business plan and are also in line with market
expectations.
Translogik
Translogik tyre probe revenues continue to deliver strong growth
with an increase of more than 15% over the prior year. Due to
careful management and close co-operation with key suppliers, the
well publicised shortages of electronic components has not had any
material impact on product availability, and margins have been
protected, partly as a consequence of a high proportion of sales
arising outside the U.K. and denominated in US dollars and
Euros.
The new modular TLGX range is now well established and has been
adopted by a number of leading global tyre original equipment
manufacturers (OEMs) as the hardware choice to complement their
fleet tyre management solutions. As previously reported, the
original TL-G1 probe is being phased out and will shortly be
entirely replaced by the TLGX range.
Not all Tyre Management Systems are operated directly by these
OEMs. We are increasingly engaging with both software and hardware
companies who have a very broad customer base ranging from OEMs to
logistics operations, and this has opened up further new exciting
opportunities for future growth.
Outlook
The directors are mindful that global economic conditions are
likely to become even more challenging in coming months, however,
they consider that the Company's business model provides
considerable resilience. The momentum that has built up in royalty
income now generates sufficient net income to comfortably cover
fixed overheads, and Translogik revenue generated in a
business-to-business setting is expected to be more reliable than
mainstream consumer markets. Furthermore, the directors continue to
believe that controlled investment in SAW technology, supported by
customer contributions and grant income, offers opportunities to
deliver significant levels of commercial revenue in future.
Accordingly, the Board is optimistic about growth prospects despite
the gathering economic headwinds.
Final audited results for the year ended 30 June 2022 and a more
detailed trading update are expected to be released around the end
of September 2022.
* Adjusted EBITDA refers to net earnings before interest,
taxation, depreciation and amortisation adjusted for the cost of
share based payments.
For further information please visit www.transense.com or
contact:
Transense Technologies plc Via Walbrook PR
Nigel Rogers (Executive Chairman)
Melvyn Segal (CFO)
Allenby Capital (Nominated Adviser and Tel: +44 (0)20 3328
Broker) 5656
Jeremy Porter / George Payne (Corporate
Finance)
Tony Quirke (Sales & Corporate Broking)
Walbrook PR Tel: +44 (0)20 7933
Tom Cooper / Nick Rome 8780
Transense@walbrookpr.com
Notes to Editors:
Transense is a developer of specialist wireless sensor systems
used to enable real-time data gathering and monitoring. Products
include the patent protected Surface Acoustic Wave (SAW) sensor
technology, used to improve equipment power, performance,
reliability and efficiency; iTrack, Transense 's Tyre Pressure
Monitoring System, licensed to Bridgestone Corporation, the world's
largest tyre producer, under a ten-year deal in June 2020; and a
range of intelligent tyre monitoring equipment under the Translogik
brand. Target sectors include automotive, aerospace, industrial,
green energy, rail and marine.
The Group's strategy is to maximise shareholder value through
the delivery of sustained revenue growth from all three principal
technologies - SAW, iTrack and Translogik probes - through
leveraging excellence in innovation, know-how in commercialising
technologies, industry partnerships and exposure to global growth
markets.
Transense is headquartered in Oxfordshire, UK, and was admitted
to trading on AIM, a market operated by the
London Stock Exchange (AIM: TRT), in 1999. www.transense.com
For further information please contact transense@walbrookpr.com
.
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