DJ Unaudited Interim Results
OTAQ Plc (OTAQ)
Unaudited Interim Results
30-Sep-2024 / 07:00 GMT/BST
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30 September 2024
OTAQ plc
("OTAQ", the "Company" or the "Group")
Unaudited Interim Results
OTAQ, the innovative technology company targeting the aquaculture and offshore markets, is pleased to announce
unaudited interim results for the six months ended 30 June 2024.
Financial Highlights:
H1 2024 H1 2023 FY 2023
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Revenue 1,510 1,801 4,407
Gross profit* 890 883 2,197
Adjusted EBITDA** (422) (347) (311)
*Depreciation on rental units moved to overhead in 2024
**Adjusted EBITDA means earnings before income, tax, depreciation, exceptional costs, impairment, share option charges and amortisation
Highlights:
-- Live Plankton Analysis now commercially launched, and first customer contract signed.
-- Sale of 19 Sealfence units to a new customer.
-- Development of new overseas markets for Offshore products beginning to provide results.
-- Increased shareholding in Minnowtech in exchange for GBP0.2m of BRS-1 product development services.
Post-Period Highlights:
-- Successful fundraise of GBP1.79m of Convertible Loan Notes, with an additional GBP1m broker option availableuntil 31/12/24.
-- Repayment in full of the GBP0.8m outstanding Cbils loan.
-- Shipping of GBP350k connector order in July to a key client.
-- Minnowtech BRS-1 won the 'Product most likely to change shrimp production' at the Global Shrimp Forum inUtrecht in September 2024.
-- Cost reduction exercise implemented to provide annualised cost savings greater than GBP500k, with overGBP150k expected to impact in 2024.
Commenting on the results and prospects, Phil Newby, Chief Executive at OTAQ, said:
"We continue to push into new markets both for our existing product range and for the newly developed products such as LPAS and Minnowtech, in both our connectors and aquaculture businesses.
"The identified cost savings will allow the Group to focus on delivering against our key strategic goals, providing the funds to concentrate sales and marketing efforts to maximise the commercial impact of our newly completed developments"
Enquiries
OTAQ PLC +44 (0) 1524 748028
Adam Reynolds, Non-Executive Chairman
Phil Newby, Chief Executive Officer
Justine Dowds, Chief Financial Officer
Dowgate Capital Limited - AQSE Corporate Advisor & Broker +44 (0)20 3903 7715
David Poutney / James Serjeant
Nicholas Chambers / Russell Cook
+44 (0)20 7933 8780
Walbrook PR Limited - PR
07971221972 or 07748325236
Tom Cooper / Nick Rome OTAQ@walbrookpr.com
About OTAQ
OTAQ is a highly innovative technology company targeting the aquaculture and offshore markets. It already has a number of established products in its portfolio and is focused on further developing its presence, customer base and cross selling opportunities within core markets both organically and via acquisition.
OTAQ's aquaculture products, which include a sonar device (developed for Minnowtech LLC) to scan shrimp in ponds and water quality monitoring, are focused on maximising welfare and production yields. Additionally, the Company is developing a potentially game changing live plankton analysis product for finfish and shellfish farmers. It also continues to target opportunities in the acoustic deterrent devices market via its Sealfence product, which is used by salmon farmers, with global opportunities in Chile, Australia, Canada and Norway.
OTAQ's offshore product range includes OceanSense subsea leak detection, Eagle IP camera systems, Lander seabed survey devices and Subsea electrical connectors and penetrators. It is targeting a number of growth opportunities in new territories and has a strong client base including Expro, Amphenol and National Oilwell Varco. The Company is also focused on the development of new products through this division, with the aim of increased cross-deployment of skills and technologies into the aquaculture arena.
The Company is also developing high accuracy location trackers for specialist applications. Having already added clients within safety and multiple participant sport/racing applications, the Company is investigating wider market potential - including opportunities in the seafood industry.
Summary
The Group presents its unaudited interim results for the six-month period ended 30 June 2024.
Trading
Revenue has been adversely impacted in the period by the delayed delivery of a key Offshore product from a supplier pushing a significant sale into July, which has resulted in revenue in the first half of GBP1.5m (H1 2023: GBP1.8m).
The Offshore division achieved revenues of GBP1.1m (H1 2023 GBP1.45m) and the Aquaculture division achieved GBP0.4m (H1 2023: GBP0.3m).
The Company has reported an Adjusted EBITDA loss of GBP422k (H1 2023 loss GBP347k).
Offshore
The Offshore division, as expected, has continued to build on the strong performance reported in 2023. The underwater connectors have performed well, only missing the H1 forecast due to the delayed delivery of a key product from a supplier pushing a significant sale into July.
Opportunities for Oceansense rentals have been reduced in H1 due to lower offshore maintenance activity, however we are encouraged by the progress shown in the newly developing overseas markets.
Aquaculture
The Company's sonar shrimp system developed for Minnowtech LLC, is now gaining traction in its target markets, and has recently won the 'Product most likely to change shrimp production' at the Global Shrimp Forum in Utrecht. Disappointingly however, orders have yet to be placed this year by Minnowtech.
The Company has identified further new customer interest in the Company's established Sealfence solution from salmon farmers in several major salmon production regions, having sold 19 Sealfence units into these core target markets in H124.
The Company also confirms that, following more than three years in development, OTAQ has now completed successful trials of its Live Plankton Analysis System (LPAS), and recently launched LPAS at the Aquaculture UK conference. The first customer contract has been signed, and progress with potential users in the southern hemisphere is encouraging.
Financial Highlights for the six months ended 30 June 2024
H1 2024) H1 2023 FY 2023
GBP'000 GBP'000 GBP'000
Revenue 1,510 1,801 4,407
Gross profit* 890 883 2,197
Adjusted EBITDA** (422) (347) (311)
*Depreciation on rental units moved to overhead in 2024
**Adjusted EBITDA means earnings before income, tax, depreciation, exceptional costs, impairment, share option charges and amortisation
H1 2024 H1 2023
GBP'000 GBP'000
Operating loss (805) (709)
Amortisation of intangible assets 143 134
Depreciation of right-of-use assets 70 84
Depreciation on property, plant and equipment 170 144
Adjusted EBITDA (422) (347)
Adjusted EBITDA was a loss of GBP0.42m from a loss of GBP0.35m in 2023, the reduction being due to the slippage of a key sale into July 24.
Net debt as at 30 June was GBP0.77m (2023: GBP0.51m) with cash balances of GBP0.18m, which was prior to the receipt of the proceeds from the successful CULS placing in July 2024.
Outlook
The Offshore Division continues to benefit from strengthening market demand for underwater connectors and penetrators.
Whilst the timing of new client orders can be difficult to predict, we anticipate significant further orders for shrimp sonar devices, together with further sales of the Sealfence, in the current financial year.
Phil Newby
Chief Executive Officer
The Board confirms that to the best of its knowledge the unaudited consolidated half year financial statements for the six months to 30 June 2024 have been prepared in accordance with IAS 34 Interim Financial Reporting amended in accordance with changes in IAS 1 Presentation of Financial Statements, as adopted by the UK
Unaudited Condensed Consolidated Statement of Comprehensive Income
Half-year ended
Notes
30 June 2024 30 June 2023
GBP000 GBP000
Revenue 1 1,510 1,801
Cost of sales (621) (918)
Gross profit 1 889 883
Administrative expenses (1,695) (1,592)
Operating loss (806) (709)
Finance expense (64) (64)
Exceptional items 2 (14) -
Loss on ordinary activities before taxation (884) (773)
Taxation 14
Loss for the period (884) (759)
Other comprehensive loss - -
Total Comprehensive Loss (884) (759)
Attributable to:
The Group (884) (759)
As per note 3, Basic and Diluted Losses Per Share were 0.7p (2023: 0.6p).
The loss for the period arises from the Group's continuing operations and is attributable to the equity holders of the parent.
There were no other items of comprehensive income for the period (2023: GBPnil) and therefore the loss for the period is also the total comprehensive loss for the period.
The notes form an integral part of these condensed financial statements. Unaudited Condensed Consolidated Balance Sheet
As at As at
Notes 30 June As at 30 June
31 December 2023
2024 2023
GBP000 GBP000 GBP000
Assets
Non-current assets
Plant and equipment 522 633 710
Right-of-use assets 145 167 277
Unlisted investments 6 709 511 511
Intangible assets 3,548 3,317 3,118
4,924 4,628 4,616
Current assets
Inventories 777 810 1,023
Trade and other receivables 532 1,299 1,081
Income tax asset 113 113 111
Cash and cash equivalents 180 316 913
1,602 2,538 3,128
Total assets 6,526 7,166 7,744
Liabilities
Current liabilities
Trade and other payables 1,061 661 614
Leases 97 134 169
Financial liabilities 4 604 484 465
1,762 1,279 1,248
Non-current liabilities
Leases 51 42 82
Financial liabilities 4 313 570 817
364 612 899
Total liabilities 2,126 1,891 2,147
Net assets 4,400 5,275 5,597
Capital and reserves
Share capital 5 1,284 1,281 1,280
Share premium 5 5,856 5,850 5,842
Deferred shares 5 5,286 5,286 5,286
Share option reserve 134 134 134
Merger relief reserve 9,154 9,154 9,154
Reverse acquisition reserve (6,777) (6,777) (6,777)
Other reserve 400 400 400
Revenue reserve (10,937) (10,053) (9,722)
Total equity 4,400 5,275 5,597
Unaudited Condensed Consolidated Statement of Changes in Equity
Issued Equity Share Deferred Share option Merger relief Reverse Other Revenue Total
capital Premium shares reserve reserve acquisition Reserve Reserve Equity
reserve
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 30 June 1,280 5,842 5,286 134 9,154 (6,777) 400 (9,722) 5,597
2023
Loss for the - - - - - - - (331) (331)
period
Issues of 1 8 - - - - - - 9
shares
At 31 1,281 5,850 5,286 134 9,154 (6,777) 400 (10,053) 5,275
December 2023
At 1 January 1,281 5,850 5,286 134 9,154 (6,777) 400 (10,053) 5,275
2024
Loss for the - - - - - - - (884) (884)
period
Issues of 3 6 - - - - - - 9
shares
At 30 June 1,284 5,856 5,286 134 9,154 (6,777) 400 (10,937) 4,400
2024 Unaudited Condensed Consolidated Statement of Cash Flows
30 June 2024 30 June 2023
GBP'000 GBP'000
Cash flows from operating activities
Operating loss (806) (709)
Adjustments for non-cash/non-operating items:
Depreciation of property, plant and equipment 170 143
Depreciation of right-of-use assets 70 84
Amortisation of intangible assets 143 134
Exceptional charges (14) -
Share option charge 8 10
(429) (338)
Changes in working capital:
Increase / (decrease) in inventories 33 (87)
Increase in trade and other receivables 745 (391)
Increase / (decrease) in trade and other payables 423 110
Cash from operations 772 (706)
Taxation - 177
Net cash from operating activities 772 (529)
Cash flows from investing activities
Purchases of tangible fixed assets (101) (267)
Purchases of intangible assets (378) (243)
Interest received - 10
Acquisition of unlisted equity securities (198) -
Net cash used in investing activities (677) (500)
Cash flows from financing activities
Repayment of loans (137) (219)
Principal element of lease payments (30) (102)
Interest paid (64) (74)
Net cash from financing activities (231) (395)
Net (decrease) / increase in cash and cash equivalents (136) (1,424)
Cash and cash equivalents at beginning of period 316 2,337
Cash and cash equivalents at end of period 180 913
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Notes to the condensed financial statements 1. Segmental information
The Group operated as three primary segments, being the rental and sales of aquaculture products (Aquaculture), rentals of underwater measurement and leak detection devices in the Offshore market and the manufacture of products for geo-tracking industries (Geotrackers). This is the level at which operating results are reviewed by the chief operating decision maker to make decisions about resources, and for which financial information is available. All revenues have been generated from continuing operations and are from external customers.
Half-year ended
30 June 2024 30 June 2023
GBP000 GBP000
Analysis of revenue
Aquaculture equipment rentals, sales and associated charges 403 319
Offshore equipment rentals, sales and associated charges 1,103 1,444
Geotracking 4 38
1,510 1,801
Half-year ended
30 June 2024 30 June 2023
GBP000 GBP000
Analysis of gross profit
Aquaculture equipment rentals, sales and associated charges 294 80
Offshore equipment rentals, sales and associated charges 594 818
Geotracking 1 (15)
889 883 2. Exceptional items
Exceptional items in the period of GBP0.01m include legal and professional costs associated incurred in the period but which relate to the issue of convertible loan notes in July 2024. 3. Losses per share
Basic earnings or losses per share are calculated by dividing the loss or profit after tax attributable to the equity holders of the Group by the weighted average number of shares in issue during the year. Diluted earnings or losses per share are calculated by adjusting the weighted average number of shares outstanding to assume conversion of all potential dilutive shares, namely share options.
The calculation of earnings or losses per share is based on the following losses and number of shares:
Half-year ended
30 June 2024 30 June 2023
GBP000 GBP000
Loss for the period attributable to the owners of the Group (884) (759)
Weighted average number of shares:
-- Basic and diluted 128,263,088 127,900,627
Basic and diluted earnings per share (pence) (0.7) (0.6) 4. Loan repayment
During the period, the Group repaid GBP0.24m of loans provided under the Coronavirus Business Interruption Loan Scheme. The loan was fully repaid in July 2024. 5. Share capital and share premium
The called-up and fully paid share capital of the Company is as follows:
30 June 2024 30 June 2023
GBP000 GBP000
Allotted, called-up and fully paid: 128,405,917 Ordinary shares of GBP0.01 each
1,284 1,280
(2023: 127,976,373 of GBP0.01 each) 6. Financial instruments - classification and measurement
Financial assets
Financial assets measured at fair value include the following:
Half year ended
30 June 2024 30 June 2023
GBP'000 GBP'000
Unlisted equity securities 709 511
709 511
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7. Basis of preparation of half-year report
This condensed consolidated interim financial report for the half-year reporting period ended 30 June 2024 has been prepared in accordance with Accounting Standard IAS 34 Interim Financial Reporting. The interim report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 31 December 2023 and any public announcements made by OTAQ PLC during the interim reporting period. This interim financial information has not been reviewed nor audited by the auditors. The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, except for the adoption of new amended standards as set out below.
New and amended standards adopted by the Group
A number of new or amended standards became applicable for the current reporting period. The Group did not have to change its accounting policies or make retrospective adjustments as a result of adopting these standards.
Going concern
The Directors have considered going concern and whilst the Company needs to continue to monitor cash flow carefully, the Directors believe that the group has sufficient cash to meet its obligations.
Significant estimates and judgements
The Group shall assess at each reporting date whether there is any indication that non-current assets may be impaired. The Directors believe that at the half-year reporting period ended 30 June 2024 no indicators of impairment existed. The Directors continue to monitor regulatory and market developments and their impact on the carrying value of the assets.
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ISIN: GB00BK6JQ137 Category Code: IR TIDM: OTAQ LEI Code: 213800CZGMYB5XTUXJ52 Sequence No.: 349701 EQS News ID: 1997735 End of Announcement EQS News Service =------------------------------------------------------------------------------------
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September 30, 2024 02:00 ET (06:00 GMT)
