Latest Results

Final Results

.This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR

Haydale (AIM: HAYD), the global advanced materials group, is pleased to announce its full year results for the year ended 30 June 2021 (“FY21”).

 

Operational Highlights:

  • Good progress made on delivering the Group’s commercial strategy and, in a challenging trading environment the Group has delivered a robust trading performance;
  • Culmination of the three-year wearable technology program with the English Institute of Sport which has produced heated garments worn by medal winners at Tokyo;
  • Sale of an HT200 Plasma Reactor to 401 Tech Bridge, Rhode Island, US to support its ambition to accelerate the commercial adoption of new materials within their innovation ecosystem;
  • Sale of elastomers to Bolfex for its premium shoe range and post year end commenced paid for feasibility projects with several premium leisure footwear manufacturers;
  • Two year contract for the sale of Silicon Carbide (“SiC”) whiskers agreed with Qinhuangdao ENO High-Tech Material Development Co., Ltd in China and secured SIC sales to a further four companies in China in FY21;
  • First sales and positive progress on the commercial roll out of CeramycGuard™ - currently working closely with a number of UK water utilities, other water facility management companies and more general civil engineering contractors;
  • Ordered a larger HT1400 plasma reactor to deliver a significant increase in Haydale’s functionalisation capacity, to allow production to move to an industrial level in 2022;
  • Focused development of our patented HDPlas® process with key achievements including:
    • developed advanced nano enhanced SynerG SuperTough 3D filament; and
    • refined next generation functionalised biomedical sensor inks incorporating improved analyte detection through the incorporation of compatible functional groups to enhance the accuracy of diagnosis.

 

Summary of Results:

 Jun-21 Jun-20
 £'m £'m
Revenue            2.90            2.95 -2%
Gross Profit 1.98 2.06 -4%
Gross Profit Margin 68% 70%-3%
Other Operating Income 0.58 0.76 -24%
Adjusted Administrative Expenses1- 4.72 - 5.36 12%
Adjusted Operating Loss - 2.17 - 2.54 15%
Statutory Loss from Operations - 3.56 - 4.23 16%
Statutory Loss After Taxation - 3.41 - 4.02 15%
Cash Outflow from Operations -1.58 -3.32 52%
Cash at Year End            1.64            0.82 100%

 

1 On a pre IFRS 16 basis Adjusted Admin Expenses for the year including lease costs would have been £5.29 million (FY20: £5.99 million).

 

Financial Highlights

  • Despite a challenging trading environment revenue fell by just 2% and gross profit margins remained resilient at 68% (FY20: 70%);
  • On a pre IFRS 16 basis a further £0.701  million of cost savings achieved - £2.43 million of cost savings realised over the last three years;
  • Reduction in Adjusted operating loss of £0.37 million to £2.17 million (FY20: £2.54 million); and
  • Cash outflow from operations reduced by £1.74 million (52%) to £1.58 million (FY20: £3.32 million).

Post Period End Highlights:

  • On 20 September 2021, the Company raised £5.10 million (gross) through the placing, retail offer and subscription of 85,055,893 new Ordinary Shares at 6.00 pence per share;
  • Filing of a joint patent with Airbus for the lightning strike electrical pre-preg.  This technology has the potential to reduce the weight and environmental impact of a commercial airliner; and
  • Signing of a memorandum of understanding with Viritech for the development of Type IV structural hydrogen tanks

Commenting on the results David Banks, Non-executive Chairman of Haydale, said:

‘The Board is encouraged by the very positive response from across several different industry sectors to our new products and technologies, which gives us confidence in our medium to long-term outlook. However, we are yet to see any sustained recovery in our Aerospace business and so we continue to be cautious with respect to short-term revenue. Haydale’s proprietary technology now has the potential to deliver material change across many sectors in ways that our customers are increasingly recognising as important in their search for more environmentally friendly materials. As a result, Haydale is expanding the Group’s capacity to functionalise nano and other materials and continues to invest in product development critical to our future success.’

 

Chairs statement

Introduction

I am pleased to present Haydale Graphene Industries Plc’s (“Haydale”, the “Group” or the “Company”) full year audited results to 30 June 2021 (“FY21”).

Despite the headwinds from the Covid-19 pandemic during the year, the Group continued to make positive progress in its transition from a research and development operation to one capable of delivering sustainable commercial revenues.   Whilst demand for the proprietary Silicon Carbide (‘SiC’) blanks manufactured at our US facility has remained subdued, the Group saw encouraging developments in its core nanomaterial business and to meet potential demand accelerated the investment in its operational and technical capacity both during FY21 and into the current financial year.

Summary financials

Commercial revenue for FY21 of £2.90 million (FY19: £2.95 million) remained in line with the prior year which was a robust performance given the subdued market conditions globally.  Gross profit marginally reduced to £1.98 million (FY20: £2.06 million) delivering a gross profit margin of 68.2% (FY20: 70,0%) broadly in line with prior year.  Other operating income for the year of £0.58 million (FY20: £0.76 million) was lower than the prior year as the Group’s shift away from grant funded to commercial projects continues. Included within other operating income is further support received from the US Cares Act.

The focus on reducing costs continued in the year with adjusted administrative expenses on a pre IFRS 16 basis falling by £0.70 million (11.7%) to £5.29 million (FY20: £5.99 million).  Over the last three reporting periods, the Group has reduced its operating cost base by £2.43 million in total on a like for like basis.  There were no non-recurring restructuring costs in the year (FY20: £0.06 million). Total Administrative Expenses were £6.11 million (FY20: £7.05 million).

Loss for the year was £3.41 million (FY20: £4.02 million)

Operational Highlights

Whilst Covid-19 may have provided the backdrop to the past year it has certainly not defined it for the Group. By focussing on the elements within our control, the Group has made solid progress towards its longer term goals. The priorities of focussed investment in our technology, delivery of commercial revenue and control of operating costs remains central to our strategy.

Focussed Investment in R&D

Haydale brings together two state of the art technologies – the patented HDPlas® functionalisation process and an understanding of graphene and other nanomaterials.  I was encouraged to see that the Company’s expertise in Hydrogen storage has attracted renewed interest in the past 18 months.  In particular, we have collaborated on the functionalised graphene masterbatch required to produce lightweight low permeability storage tanks to help unlock the pathway to hydrogen propulsion.  During the year the Company has also seen demand for the functionalisation of other nanomaterials accelerate and, in particular, demand for Boron Nitride, where Haydale has been engaged to functionalise the ‘white graphene’ to improve its dispersibility into lubricants to increase heat dissipation from moving parts.      

Commercial Development

During the year, the Group made progress in commercialising its core technology portfolio despite the challenging operating environment.  I would highlight the three-year exclusive agreement with iCraft announced in September 2020  and in December 2020 we secured our first sale of functionalised nano-enhanced rubber masterbatch for use in a premium shoe range.  Subsequent to this sale, the Company has been engaged by several companies in the premium leisure footwear market.

I was also pleased to see the Company broaden its trading footprint with sales of SiC and blanks to new customers in the Far East and in Europe.  We also extended our distribution agreement for Ceramycguard™ to 2030 and this range of products continues to attract significant interest from water utilities and civil engineering operations both in the UK and the Middle East.  We achieved our first sales in the year and anticipate revenue will grow in the current year.

Cost Restraint

The Group continued to realign its cost base and, during the year, it reduced its overall headcount whilst continuing to invest in its global sales presence.  The Group also realised other overhead savings and, as noted above, like-for-like administrative expenses reduced by £0.70 million, (11.7%) in the year without affecting the operational capacity of the Group. 

Impact of Covid-19

The principal trading impact of Covid-19 has been the slowdown in the global aviation sector which has reduced demand for SiC and the SiC blanks that we manufacture at our US facility.  The immediate impact has been mitigated to an extent by the continued support of our largest customer which offered this business unit valuable breathing space. During the year the Group has moved to reduce medium term exposure to the aviation sector and, as noted above, has entered new markets for its existing products and by adopting complementary products such as Ceramycguard™, has accessed new markets and customers. 

Within the wider operation, despite an initial slowdown which saw a number of projects delayed or postponed, business has remained robust. I am pleased to report that, as the UK moved through the second and third waves, whilst not ‘business as normal’, projects and contracts progressed according to revised plans.

At no time during the year were any of the Group’s sites closed and the Company acted in accordance with the latest guidance at each of its locations

Staff

I would like to thank the executive management team who have maintained the momentum of our transition during these unprecedented times.  In particular, for ensuring that our facilities continued to operate during the year with minimal interruption and without compromising on the safety and wellbeing of our employees.  I would also like to thank our staff who have readily adjusted to rapidly evolving local restrictions and have effectively embraced new technology and ways of working.  Their resilience and flexibility have allowed the Group to continue to operate effectively over the past year.

Funding

The Directors believe the business is well placed to benefit from a recovery in the aviation industry and the wider improvement in the global economy.  During the year we were pleased to be awarded a £1.10 million loan from Innovate UK and this will allow the business to expand its functionalisation capacity eight-fold at our Ammanford facility and support increased investment in our production, sales and marketing resources.  At 30 June 2021 we had drawn down £0.8 million of this facility.  

On 20 September 2021, the Company completed an equity placing raising £5.10 million (gross) and I would like to welcome our new shareholders and to thank our existing shareholders for their continued support at this time.

Outlook

The Board is encouraged by the very positive response from across several different industry sectors to our new products and technologies, which gives us confidence in our medium to long-term outlook. However, we are yet to see any sustained recovery in our Aerospace business and so we continue to be cautious with respect to short-term revenue. Haydale’s proprietary technology now has the potential to deliver material change across many sectors in ways that our customers are increasingly recognising as important in their search for more environmentally friendly materials. As a result, Haydale is expanding the Group’s capacity to functionalise nano and other materials and continues to invest in product development critical to our future success.

 

David Banks
Chair
14 December 2021

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2021

REVENUE

  4 2,903 2,947
Cost of sales    (924) (885)

Gross profit

 1,979 2,062
Other operating income 5 575 756
Adjusted Administrative expenses    (4,724) (5,357)

Adjusted operating loss

   (2,170) (2,539)
Adjusting administrative items:      
      Share based payment income/(expense)    (119) 11
      Restructuring costs   6- (63)
      Depreciation and amortisation    (1,271) (1,640)
    (1,390) (1,692)
Total trading administrative expenses    (6,114) (7,049)
LOSS FROM OPERATIONS    (3,560) (4,231)
Total administrative expenses    (6,114) (7,049)
     
LOSS FROM OPERATIONS    (3,560) (4,231)
Finance costs    (211) (176)
      
LOSS BEFORE TAXATION   6 (3,771) (4,407)
Taxation   8 363 391
      
LOSS FOR THE YEAR FROM CONTINUING OPERATIONS    (3,408) (4,016)
Other comprehensive income:
Items that may be reclassified to profit or loss:      
Exchange differences on translation of foreign operations    (368) 82
Items that will not be reclassified to profit or loss:      
Remeasurements of defined benefit pension schemes    208 (291)
      
TOTAL COMPREHENSIVE LOSS FOR THE YEAR FROM CONTINUING OPERATIONS     
(3,568)
 
(4,225)
     
Loss for the year attributable to:      
Owners of the parent    (3,408) (4,016)
     
Total comprehensive loss attributable to:      
Owners of the parent    (3,568) (4,225)
     
Loss per share attributable to owners of the Parent      
Basic (£)   9 (0.01) (0.01)
Diluted (£)   9 (0.01) (0.01)

 


CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2021

Company Registration No. 07228939   
 
Note
30 June
2021
£’000
30 June
2020
£’000
ASSETS     
Non-current assets     
Goodwill  10 1,341 1,454
Intangible assets  10 1,174 1,145
Property, plant and equipment  11 6,622 6,407
     
  9,137 9,006
     
Current assets     
Inventories  12 1,328 1,712
Trade receivables  13 715 886
Other receivables  14 595 334
Corporation tax  14 364 384
Cash and bank balances   1,644 823
     
   4,646 4,139
     
TOTAL ASSETS   13,783 13,145
    
LIABILITIES     
Non-current liabilities     
Bank loans  20 844 304
Pension Obligation  26 1,026 1,435
Other payables  19 2,370 1,031
    
  4,240 2,770
Current liabilities     
Bank loans  20 885 944
Trade and other payables  19 1,719 1,906
Deferred income  15 180 74
     
   2,784 2,924
     
TOTAL LIABILITIES   7,024 5,694
     
TOTAL NET ASSETS   6,759 7,451
    
EQUITY     
Capital and reserves attributable to equity holders of the parent     
Share capital  16 8,505 6,804
Share premium account  16 28,820 27,764
Share-based payment reserve   250 131
Foreign exchange reserve   (386) (18)
Retained losses   (30,430) (27,230)
     
TOTAL EQUITY   6,759 7,451
    

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 30 June 2021

  
 
Share
capital
£’000
 
 
Share premium
£’000
Share-based payment reserve
£’000
 
Foreign Exchange Reserve
£’000
 
 
Retained losses
£’000
 
 
Total Equity
£’000
       
At 1 July 2019 6,354 27,764 828 (100) (23,595) 11,251
       
Comprehensive Loss for the year      
Loss for the year - - - - (4,016) (4,016)
Other comprehensive loss - - - 82 (291) (209)
       
Total Comprehensive loss 6,354 27,764 828 (18) (27,902) 7,026
Contributions by and distributions   to owners      
Recognition of share-based payments - - (11) - - (11)
Share based payment charges – lapsed options - - (686) - 686 -
Issue of ordinary share capital 450 - - - - 450
Transaction costs in respect of share issues - - - - (14) (14)
       
At 30 June 2020 6,804 27,764 131 (18) (27,230) 7,451
       
Comprehensive Loss for the year      
Loss for the year - - - - (3,408) (3,408)
Other comprehensive loss - - - (368) 208 (160)
       
Total comprehensive loss 6,804 27,764 131 (386) (30,430) 3,883
Contributions by and distributions to owners      
Recognition of share-based payments - - 119 - - 119
Issue of ordinary share capital 1,701 1,276 - - - 2,977
Transaction costs in respect of share issues - (220) - - - (220)
       
       
At 30 June 2021 8,505 28,820 250 (386) (30,430) 6,759
      

 

 


 
 

CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2021

    
 
 
 
 
Note
Year
ended
30 June
2021
£’000
Year
ended
30 June
2020
£’000
      
Cash flow from operating activities      
Loss before taxation    (3,408) (4,016)
Adjustments for:-      
Amortisation of intangible assets   10 176 129
Depreciation of property, plant and equipment   11 1,096 1,511
Profit on disposal of plant and equipment and F&F    78 -
Share-based payment charge   17 119 (11)
Finance costs    211 176
Pension – net interest expense   26 47 24
Taxation    (363) (391)
      
Operating cash flow before working capital changes    (2,044) (2,578)
      
Decrease/(increase) in inventories    384 (531)
(Increase) in trade and other receivables    (90) (111)
Increase/(decrease) in payables and deferred income    174 (104)
      
Cash used in operations    (1,576) (3,324)
      
Income tax received    383 847
      
Net cash used in operating activities    (1,193) (2,477)
     
Cash flow used in investing activities      
Purchase of  plant and equipment    (220) (44)
Capitalised of Intangible Assets    (260) (251)
      
Net cash used in investing activities    (480) (295)
      
Cash flow used in financing activities      
Finance costs    (95) (94)
Finance costs – right of use asset    (116) (82)
Payment of lease liability    (591) (631)
Proceeds from issue of share capital   16 2,977 450
Share capital issues costs allocated against share premium   16 (220) -
New bank loans raised   29 800 50
Repayments of borrowings   29 (219) (835)
      
Net cash flow from financing activities    2,536 (1,142)
      
Effects of exchange rates changes    (42) 49
     
Net (decrease) in cash and cash equivalents    821 (3,865)
      
Cash and cash equivalents at beginning of the financial year    823 4,688
      
Cash and cash equivalents at end of the financial year    1,644 823
     

 

 


 

Page last updated: 15 December 2021