Kromek Group PLC Business and Trading Update (5366L)
May 16 2022 - 2:01AM
UK Regulatory
TIDMKMK
RNS Number : 5366L
Kromek Group PLC
16 May 2022
16 May 2022
Kromek Group plc
("Kromek" or the "Group")
Business and Trading Update
Kromek (AIM: KMK), a leading developer of radiation and
bio-detection technology solutions for the advanced imaging and
CBRN detection segments, provides an update on business and trading
for the year ended 30 April 2022.
As noted in the Group's interim results announcement in January
2022, Kromek continued to deliver on its existing contracts as well
as win new and repeat orders during the first half of the year. In
H2 2022, the commercial momentum increased, ahead of management's
expectations, including GBP5.9m in new orders being won in the
final quarter, primarily in the CBRN detection segment.
The additional contract wins contributed to the Group achieving
strong revenue growth in H2 over H1 2022 and Kromek expects to
report revenue of GBP12.1m for the year ended 30 April 2022 (FY
2021: GBP10.4m), an increase of approximately 16%. However, the
Group continued to be impacted by supply chain issues as detailed
in the interim results. Specifically, the late arrival of certain
components prevented the completion of orders totalling
approximately GBP2.9m that were scheduled to be delivered before
the year end. These orders have now begun to be shipped and the
revenue is expected to be recognised in the first half of the
current financial year. As a result, the Group expects to report an
adjusted EBITDA loss for the year ended 30 April 2022 of
approximately GBP1.2m.
The Group continued to maintain tight cost control, improve
collections, and manage cash flow. As a result, and despite the
significant increase in inventories due to the delayed shipment of
certain orders, the Group had cash and cash equivalents at 30 April
2022 of approximately GBP5.1m. Kromek expects cash inflows
following the delivery and payment of the aforementioned GBP2.9m
orders; the unwinding of high inventory levels; and a continued
improvement in customer collections. Consequently, the Board
believes that the Group has sufficient cash available for the
foreseeable future.
For the current financial year, Kromek continues to expect
accelerated growth in both its segments and is forecasting
substantial revenue growth in the year to 30 April 2023. The Group
has excellent visibility over full year revenue forecasts with 50%
contracted, 37% going through contract negotiation and the
remaining 13% being provided by the Group's regular repeat order
business. This is the highest level of visibility that the Group
has ever had at the start of a financial year.
The anticipated growth is based on delivery under existing
long-term contracts, new orders won in H2 2022, and the sustained
demand being received for its products. In particular, the current
geo-political environment is driving increased interest from
government agencies in Kromek's products in the CBRN detection
segment. In advanced imaging, Kromek's CZT-based products continue
to be in high demand from both its existing and new OEM
customers.
Accordingly, the Board remains confident of the Group's
prospects and of delivering further strong growth in the current
year. The level of contracted revenue continues to build, further
improving revenue visibility and the Board is enthused by the
substantial opportunities for Kromek and its technology.
The Group will provide further information at the time of its
full year results announcement in July 2022.
For further information, please contact:
Kromek Group plc
Arnab Basu, CEO
Paul Farquhar, CFO +44 (0)1740 626 060
finnCap Ltd (Nominated Adviser and Broker)
Geoff Nash/Kate Bannatyne/George Dollemore
- Corporate Finance +44 (0)20 7220 0500
Tim Redfern/Charlotte Sutcliffe - ECM
Luther Pendragon (Financial PR)
Harry Chathli/Claire Norbury +44 (0)20 7618 9100
About Kromek Group plc
Kromek Group plc is a leading developer of radiation detection
and bio-detection technology solutions for the advanced imaging and
CBRN detection segments. Headquartered in County Durham, UK, Kromek
has manufacturing operations in the UK and US, delivering on the
vision of enhancing the quality of life through innovative
detection technology solutions.
The advanced imaging segment comprises the medical (including CT
and SPECT), security and industrial markets. Kromek provides its
OEM customers with detector components, based on its core cadmium
zinc telluride (CZT) platform, to enable better detection of
diseases such as cancer and Alzheimer's, contamination in
industrial manufacture and explosives in aviation settings.
In CBRN detection, the Group provides nuclear radiation
detection solutions to the global homeland defence and security
market. Kromek's compact, handheld, high-performance radiation
detectors, based on advanced scintillation technology, are
primarily used to protect critical infrastructure and urban
environments from the threat of 'dirty bombs'.
The Group is also developing bio-security solutions in the CBRN
detection segment. These consist of fully automated and autonomous
systems to detect a wide range of airborne pathogens.
Kromek is listed on AIM, a market of the London Stock Exchange,
under the trading symbol 'KMK'.
Further information is available at www.kromek.com .
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