Pre Close Trading Update
13 January 2015
Image Scan, (AIM: IGE) specialists in the field of real-time X-ray imaging for the Security and Industrial Inspection markets, today provides a pre-close trading update ahead of its results for the year ended 30 September 2015.
- Sales of £1,700k at a gross margin of approximately 38% resulted in a pre-tax trading loss of approximately £640k
- Sales were held back by delays in the product development programme as previously announced. The issues have now been rectified
- Research and development spend increased to drive product launches
- First customer deliveries of a new ultra-thin portable X-ray detector panel and associated software
- Upturn in orders for industrial inspection systems
- Won UK Government grant to develop new generation portable detector using technology licensed from Ibex Innovations
- £470k of cash at the end of the period (H1 2015: £455k)
Security sales during the year of £1,200k (2014: £1,500k) were held back by the delayed availability of new portable X-ray systems, while industrial sales of £500k (2014: £660k) brought total sales to £1,700k (2014: £2,200). Gross margin was improved at 38% (2014: 31%) reflecting both increased margin on security products, as process and supply chain improvement took effect, and the winding down of a large loss making contract in the nuclear industry.
An increase in overheads of £80k was attributable to increased spending on research and development as the business focussed on overcoming product development delays in its new portable X-ray systems. The resulting pre-tax loss for the business was approximately £640k (2014: £520k)
The year saw the market release and first customer deliveries of the new ThreatScan®-LS1 detector panel and the associated new software system. These products joined the recently developed portable X-ray generator to create an all-new high performance portable X-ray system for security and counter terrorism professionals world-wide. A grant was received from the UK Government under which a Precision Linescan Detector will be developed, combining Image Scan’s portable X-ray technology with new detector technology licensed from Ibex Innovations to deliver further performance improvements.
While industrial sales in the year were un-remarkable at 2 units (2014: 3 units) the Company has seen increased demand from manufacturers of automotive emission control systems for its X-ray inspection systems. The Company starts FY 2015/16 with 4 units in the order book. The final customer acceptance was completed on a one off large inspection system developed for the nuclear industry that has adversely impacted Company performance in recent years.
The Company expects to announce its preliminary results in December.
Image Scan’s Chairman and Chief Executive, Bill Mawer, commented: “As previously announced the delayed availability of the replacement portable X-ray generator from our partner and, more recently, of the new detector panel from our internal Research and Development team has adversely impacted the business this year.
However it is pleasing to see first orders and deliveries for this system and our sales team and their partners are now demonstrating the system to security customers world wide. We look forward to working with Ibex Innovations on a new generation of portable X-ray detector technology. The strong order intake for our industrial inspection systems, a trend we expect to continue into the new financial year, is also pleasing as these sales usually include valuable long term support contracts.”
For further information, please contact:
Image Scan Holdings plc Tel: +44 (0) 1509 817400
William Mawer, Chairman
Sarah Atwell-King, Company Secretary
Cantor Fitzgerald Europe Tel: +44 (0) 207 894 7000
Rick Thompson / David Foreman / Michael Reynolds (Corporate Finance)
David Banks / Tessa Sillars (Corporate Broking)
About Image Scan Holdings plc
Image Scan Holdings plc (AIM: IGE) is focused on the development and commercialisation of market leading real-time X-ray solutions for use in the global Security and Industrial inspection markets. The Company’s Security portfolio includes the ThreatScan® range of portable bomb and suspect package detection systems; the Axis range of baggage inspection systems; and SVXi, a small vehicle inspection system. The Industrial inspection solutions include the MDXi product range, cabinet X-ray systems for laboratories and production lines. The Company is now broadening its scope to look at other key applications where its technology can be adopted, such as in the Medical devices industry. The Company was founded in 1996 and joined AIM in 2002.
For further information on the Company, please visit: www.ish.co.uk – and for further information on its products, please visit: www.3dx-ray.com