Chief Executive's Report
Overview
The first half of FY26 marks the first reporting period of the enlarged Group following the acquisition of Intelligent Resource Management Ltd trading as SaveMoneyCutCarbon ("SMCC") in January 2026. Operationally, it represents the point at which Haydale moved from restructuring into execution. These results include approximately one full quarter of trading with SMCC included as part of the Group.
The comparative FY25 interim results reflected the Group's prior position: an underperforming, over-extended advanced materials business with an unsustainable cost base, overseas losses and insufficient commercial focus. The subsequent FY25 Annual Report set out the completion of the structural reset: overseas losses removed, the operating footprint simplified, JustHeat® certified, SMCC acquired and the Group repositioned around proprietary products, customer access and programme delivery.
The Board believes the first half of FY26 demonstrates the strategic rationale for that reset. Revenue has increased materially to £2.25 million, in line with the Board's internal budget for H1 FY26 and consistent with the management information underpinning the Group's FY26 plan. This is an important milestone for the enlarged Group and demonstrates that Haydale is now operating from a materially different revenue base. The comparatives are presented on the basis of continuing operations for the equivalent period last year with the discontinued operations stripped out.
The strategic point is simple. Haydale remains an advanced materials and graphene-enabled technology business, but it is no longer seeking to commercialise graphene primarily by waiting for third parties to adopt its technology. The Group's strategy is now to deploy its proprietary HDPlas® platform and graphene-enabled technologies through products, systems and services that solve practical customer problems and where Haydale can participate in the downstream economics. These proprietary products can be sold alone, or as part of a broader bundle of water and energy-saving solutions.
Execution of the enlarged Group strategy
Customers do not buy graphene because it is interesting. They buy lower bills, simpler installation, improved efficiency, reduced carbon, compliance, resilience and measurable returns.
JustHeat® is the clearest example of the new model. It is enabled by Haydale's proprietary HDPlas® functionalisation capability and graphene-based heater ink, but it is sold as a practical heating system, not as an advanced materials proposition. Customers are not being asked to adopt graphene as a science project. They are being offered a heating solution designed to reduce cost, complexity and disruption.
The same principle applies across the enlarged Group. Haydale's technology base provides differentiated products and solutions optionality. SMCC provides the route to the customer. The commercial model is to convert that combination into repeatable revenue.
The Group now operates across six closely related commercial areas:
· Advanced Materials, including Super-Efficient Thermal Transfer Fluid;
· Energy Efficiency and Compliance Services, including JustHeat®;
· Renewables;
· E-Mobility;
· Water Efficiency; and
· Online / Direct-to-Consumer Sales, including JustHeat Go.
These business lines are not separate silos. They are complimentary routes into the same customer base. A customer may first engage with the Group through a water-saving audit, an EV charging requirement, a renewables project, a compliance need or a heating enquiry. The strategic objective is to use each entry point to build a broader relationship into which additional products and services can be introduced and sold over time.
This is where the SMCC acquisition is strategically important. SMCC was acquired to transform how the Group originates commercial opportunity. It gives Haydale embedded access to customers through programme relationships and Impact Partners, reduces customer acquisition cost and creates a platform through which proprietary Haydale technologies, including JustHeat®, can be introduced into customers that already have an energy, water or carbon performance need.
Five months into the acquisition, the data supports that thesis. Impact Partners have become a meaningful new channel for Haydale, accounting for approximately one-third of active opportunities. Importantly, Impact Partner-sourced opportunities are, on average, approximately five times larger than direct-originated opportunities, at around £150,000 per opportunity.
This supports the core commercial rationale for the acquisition: combining Haydale's proprietary graphene-based technologies with customer access, programme delivery capability and an accredited installer network. The value of an Impact Partner relationship is not limited to the immediate contract with that partner. It is the customer access the partner can create. Post-period developments further support this platform strategy. SMCC expanded its water-efficiency platform through a multi-year framework agreement and exclusivity arrangement with Wave Utilities, under which SMCC has been appointed as Wave's exclusive external delivery partner for water efficiency audits and secured a right of first refusal on funded water efficiency projects. The Wave relationship is expected to generate at least £1.0 million of recurring programme-based revenue annually, with a broader identified medium-term opportunity pipeline of approximately £5.7 million.
SMCC has also expanded its Impact Partner model through Lloyds Banking Group confirming its intention to proceed to a national roll-out across its SME & Mid Corporates customer base, following a successful regional pilot. This materially expands SMCC's ability to support a broad base of SME and Mid Corporate clients and property owners and provides another route to deploy energy efficiency, JustHeat®, renewables and EV infrastructure solutions through a structured partner channel.
The Group's expanded relationship with ABB E-mobility is a further practical example of this model. SMCC is ABB E-mobility's exclusive UK distributor for AC electric vehicle chargers and has now been appointed as an ABB E-mobility Platinum Partner, enabling SMCC to offer DC electric vehicle charging infrastructure and associated service packages to customers as part of the wider SMCC platform. The strategic importance of this relationship is not limited to EV charging product sales. It strengthens one of the customer entry points through which SMCC can originate broader energy, water and carbon reduction opportunities.
For example, SMCC recently completed an EV charging installation for a leading UK motorsport technology business following an ABB E-mobility referral. That initial E-Mobility engagement has led to the evaluation of a wider programme covering JustHeat® applications, water metering and efficiency, boiler optimisation, supply-chain energy efficiency support and evaluation of the Group's graphene-enabled cooling fluid technology. These discussions remain subject to normal conversion risk, but they demonstrate the cross-selling model that the Group is building.
SMCC identifies then delivers products and services into those customers to meet their sustainability objectives and reduce ongoing costs. Over time, additional solutions can be introduced, compliance and monitoring layers can be added, and recurring and repeatable revenues can be developed alongside deployment revenues. Post-project aftercare and energy, water and carbon saving reporting services maintain the ability to have an ongoing dialogue around further measures that can be deployed with those customers.
This improves revenue visibility, reduces reliance on one-off customer wins and supports more efficient scaling. The most efficient scaling is driven by manufacturing and deploying Haydale's proprietary graphene-based products, such as JustHeat®, through customer relationships originated by the wider SMCC platform.
JustHeat® product platform update
JustHeat® was launched approximately twelve months ago. During the Period, the Group focused on moving the product from certified technology into a more scalable commercial platform.
The principal areas of progress have been production, installation cost-base and technical optimisation, manufacturability, refinement of the controls, electronics, product range expansion and route-to-market development, in each case responding to customer and installer feedback.
As mentioned, the Group has reduced the cost base of the JustHeat® system during the Period, principally by bringing assembly of the electronics and control system in-house at Ammanford. This improves control over cost, quality and supply chain, and is an important step towards scaling the product.
The original JustHeat® system was launched as a 48V DC product, designed to be compatible with rooftop solar PV, battery systems and low-voltage energy architectures. The Group has now successfully developed a 100-110V AC direct-to-mains version for deployment into markets such as the US and Japan, subject to applicable product certification and local approvals. This version has been developed in response to customer and partner demand and is designed to reduce the need for additional power conversion equipment, simplify installation and improve the customer proposition.
The Group has also progressed the wall-mounted coving and skirting heating product developed with NMC Group, first announced in June 2025. This product is undergoing applicable conformity testing and is expected to be available in 240V, 100-110V and 24V versions. The product is designed for properties where underfloor heating is not appropriate, including heritage or listed buildings, and situations where floor disruption is commercially or practically unattractive.
In addition, the Group has developed a lower-voltage 24V version of the JustHeat® heating panels targeted at caravan, mobile-home, marine and off-grid applications. During the Period, the first marine installation of JustHeat® was completed, opening a further potential market segment for the technology.
Commercial progress for JustHeat® has been behind the Board's original expectations. A significant factor has been the historic treatment of electric heating within the UK's building energy performance framework, where the current EPC calculation has treated JustHeat® conservatively and has not fully reflected responsiveness, controllability, thermal performance, zoning, operating profile or integration with other building technologies.
During the period, however, the Group secured an important step in the recognition of JustHeat® within the UK's building energy performance (EPC) framework. From July 2026, JustHeat® installations will, for the first time, be capable of being assessed favourably within the EPC calculation. The Board believes this addresses a material barrier to adoption and could be an important commercial driver, particularly in the retrofit and private rented sectors.
Independent modelling across a range of building archetypes indicates that, under the revised treatment, JustHeat® has the potential to improve the EPC performance of hard-to-treat homes by as much as three EPC bands and support the achievement of EPC Band C in realistic retrofit scenarios. Achieving EPC Band C is central to Minimum Energy Efficiency Standards (MEES) compliance for landlords, and the Board believes appropriate recognition of JustHeat® within the UK's EPC framework materially improves the commercial proposition for the product.
The UK Government has also indicated its intention to update electric-heating efficiency standards towards intelligent, controllable and serviceable heating systems, and away from low-control commodity products. This plays directly to the strengths of JustHeat®. The rapid and uniform delivery of heat from the panels, combined with the integrated enclosure incorporating power management, monitoring and control systems, means that JustHeat® provides a complete heating solution aligned with the direction of the proposed regulations.
The Board believes these regulatory changes further reinforce the long-term value of the JustHeat® platform.
Super-Efficient Thermal Transfer Fluid
The Group has continued development and testing of its proprietary HDPlas® graphene-enabled thermal transfer fluid, which the Board believes represents a significant potential application of Haydale's functionalised graphene platform.
The product is currently undergoing commercially relevant testing in cooling environments, including direct-to-chip and cooling-loop applications relevant to high-performance computing and data centres. These markets are being reshaped by the rapid growth of AI, increasing rack power densities, rising industrial energy costs and the physical constraint that heat now places on performance, energy efficiency and infrastructure scalability.
Conventional glycol-based fluids are widely used in closed-loop heating and cooling systems because of their freeze-protection and operating-temperature characteristics. However, glycol can materially reduce heat-transfer performance and increase pumping requirements compared with water, with performance degradation of up to 20% in some applications and higher in more demanding environments.
Haydale's Super-Efficient Thermal Transfer Fluid is designed to counteract this degradation by improving the thermal and hydraulic performance of glycol-based systems. Testing to date indicates that the fluid has the potential to recover a material proportion of the performance losses associated with conventional glycol-based cooling loops. The Board believes this could be highly significant in data-centre, high-performance-computing and other industrial cooling environments, where cooling capacity, energy efficiency and system resilience are becoming critical constraints. The potential benefit is not limited to lower cooling costs. It is the ability to help customers run more computing power or industrial output from the same electrical and cooling infrastructure.
This is precisely the type of application for which Haydale's technology platform was developed: a graphene-enabled solution addressing a clear, measurable and economically valuable industrial problem. If successfully validated through customer trials and qualification processes, the Board believes the Super-Efficient Thermal Transfer Fluid has the potential to become a major new pillar of the Group's commercial platform alongside JustHeat®.
The commercial opportunity remains subject to successful completion of customer trials, qualification processes and commercial adoption, and there can be no assurance of future revenues. However, the Board believes this is a significant example of Haydale's strategy: taking proprietary graphene-enabled technology into a valuable end-market where the customer need is clear, urgent and measurable.
H1 FY26 performance and revenue quality
The first half of FY26 provides clear evidence that the enlarged Group is materially different from historic Haydale.
Revenue increased to £2.25 million compared with £0.40 million from continuing operations in the same period for FY25, reflecting the first contribution from the enlarged Group and the emergence of the new Haydale revenue base. Revenue for the Period was in line with the Board's internal budget for H1 FY26 and consistent with the management information underpinning the Group's FY26 plan.
Gross profit increased to £0.85 million from £0.20 million. Gross margin was lower than the prior-year comparative, at 37.9% compared with 50.9%, reflecting the broader revenue mix introduced through SMCC, including programme delivery, installation and service activity. These revenues may not carry the same gross margin profile as pure development work, but they are more repeatable and more scalable.
The Board is seeking to improve revenue quality, repeatability and visibility. High-margin development projects remain valuable where they are linked to defined customer programmes, but the Group's strategy is no longer to rely on isolated technical projects as the primary revenue model.
The Board does not consider a straight-line annualisation of H1 FY26 revenue to be representative of the Group's expected FY26 performance. H1 includes approximately one full quarter of SMCC trading, whereas H2 will include a full six-month contribution from the enlarged Group. Delivery remains weighted towards H2 and dependent on continued conversion of contracted work and identified opportunities, but the Board believes the enlarged Group now has the platform, customer access and product set required to pursue its objectives. The Board remains focused on delivering current FY26 market expectations and achieving positive EBITDA within c.12 months of the SMCC acquisition, supported by the enlarged and growing contracted order book, a full H2 contribution from SMCC, Impact Partner-led activity and continued cost discipline.
Cash and funding
The January 2026 fundraise and acquisition of SMCC have materially increased the scale and strength of the Group. Cash at Period end was £3.36 million following the successful January 2026 fundraising and acquisition.
The Group remains disciplined on costs and capital allocation. The Board's focus is on converting the enlarged platform into repeatable revenue while maintaining financial discipline.
Unaudited Financial Results
As noted, these results include the period between completing the Haydale restructuring, the acquisition of SMCC and the first quarter as a combined group with integration largely complete. The H1 FY25 comparatives represent continuing Haydale operations, albeit under a business model in transition, restated following the extended FY25 reporting period to reflect the directly comparable period for the prior year.
The Group's recognised commercial income from continuing operations in the Period was £2.25 million (H1 FY25 £0.4 million) reflecting the restructured historic Haydale business which includes one complete quarter of SMCC's performance following acquisition. Gross margin was down accordingly due to the sales mix being weighted towards SMCC business lines.
Adjusted administrative expenses were £2.04 million (H1 FY25: £1.03 million), reflecting significant progressive cost reductions in the legacy Haydale business, offset by SMCC operating costs being incorporated for a quarter. Annualised back-office integration cost savings from synergies of c.£0.3 million were achieved post-period end.
The Group's Adjusted Operating Loss from continuing operations was £1.16 million (H1 FY25 £0.68 million) and the Loss before taxation was £2.51 million (H1 FY25 £0.85 million), reflecting acquisition costs and increased depreciation charges. Capital expenditure totalled £0.05m (H1 FY25 £nil)
The Group's net assets at 31 March 2026 were £14.64 million, including £8.54 million of Goodwill and £3.36 million of intangibles arising on the acquisition of SMCC (30 September 2025: £1.30 million). Trade and other payables of £2.50 million include the acquired SMCC business, which has a higher than historic level of creditors and accruals reflecting the increased trading levels in that entity. The Group's borrowings reduced by £0.55 million to £1.27 million (30 September 2025: £1.82 million) reflecting the conversion of the loan notes issued as part of the November 2024 fundraise.
As mentioned, cash at the Period end was £3.36 million (30 September 2025: £1.68 million). Negative operating cash flow before working capital changes was £1.94 million (H1 FY25 £1.80 million), with Cash Used in Operations, including payment of acquisition and related SMCC costs, totalling £3.87 million (H1 FY25 (£1.93) million).
In addition to the 417,883,894 new ordinary shares of 0.01 pence each ("Ordinary Shares") issued in December 2025 on the conversion of the loan note, on 7 January 2026 the Company raised a total of £5.75 million (gross) of equity via the issue of 1,150,000,000 new Ordinary Shares at an issue price of 0.5 pence each. On 8 January 2026, the Company issued 1,883,869,258 Ordinary Shares as consideration for the acquisition of SMCC, with a further 992,248,061 deferred shares to be issued in two tranches subject to certain share price milestone targets being met by prescribed target dates. As at the date of this announcement, the Company had 7,774,709,099 Ordinary Shares in issue (30 September 2025: 4,322,955,947).
Outlook
The Group's mission is to improve the energy, water and carbon performance of one million buildings. The Board believes the combination of proprietary technologies, programme delivery capability, embedded customer access, digital subscription infrastructure and Impact Partner relationships provides a credible route to achieving that objective over time.
The strategic reset is complete. The Group is now focused on execution: building and converting pipeline into contracted revenue, expanding programme relationships, increasing cross-selling across the SMCC platform, launching extensions of the JustHeat® platform, progressing customer trials of the Super-Efficient Thermal Transfer Fluid, selectively bringing forward further applications from Haydale's technology portfolio where there is a clear route to market and building recurring and repeatable revenue streams.
Haydale's progress should increasingly be assessed against the new model. Individual announcements should not only be viewed only through the lens of immediate contract value. The more important questions are whether they increase customer access, improve repeatability, expand the platform, create cross-selling opportunities and support repeatable revenue.
The Board remains convinced that the Group's intellectual property and advanced materials capability retain significant value. However, the best route to extracting shareholder value is through ownership of products, services and customer relationships that leverage graphene-enabled capabilities as part of a wider customer-focused strategy.
That is the model we believe will create long-term shareholder value.
Simon Turek
Chief Executive Officer
23 June 2026
