REG - Nanoco Group PLC - Interim Results & Investor Presentation
15/04/2025 07:02
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RNS Number : 9759E Nanoco Group PLC 15 April 2025
15 April 2025
NANOCO GROUP PLC
("Nanoco", the "Company" or the "Group")
Interim Results & Investor Presentation
Steady progress on commercial opportunities and assessing strategic options
Nanoco Group plc (LSE: NANO), a world leader in the development and
manufacture of cadmium-free quantum dots and other specific nanomaterials
emanating from its technology platform, announces its unaudited interim
results for the half year ended 31 January 2025 ("the Period" or "H1 FY25").
Refocused on strategic growth
Continued commercial progress and revitalised engagement
· Appointed a new Chairperson in Dr Jalal Bagherli, recruited and
appointed a new CEO in Dmitry Shashkov, and appointed a Global Head of
Business Development to help drive commercial engagement.
· Entered the second year of the Joint Development Agreement ("JDA")
with the Asian Chemical customer - all milestones successfully achieved
to-date and discussions commenced regarding next steps.
· Advanced discussions with a potential second significant Asian
chemical company, a major advanced materials and chemicals manufacturer, to
work on next generation heavy metal-free quantum dot materials and device
technology for Short Wave Infrared (SWIR) applications.
· Increased the size of commercial pipeline to greater than ten
projects, with strong focus on Image Sensor and Flat Panel Display markets,
and additional early-stage engagements in other segments such as Photovoltaic,
Agriculture, and Coatings and Paints.
Significant forecast growth in key markets provides an opportunity
· We remain at the forefront of quantum dot development for sensing
applications. The company is financially underpinned and supported by our
validated and enforceable IP.
· Market sector forecasts(1) continue to indicate significant growth in
our key markets of sensing and display - the adoption of quantum dot
technology in mobile phones for sensors and small screen micro-LEDs for
display should lead to a step change in addressable markets for Nanoco.
· Other markets are assessing the opportunity to work with quantum dots
in their products, which could also offer significant opportunity over the
long term.
· We continue to progress as a research-led production company, with
the ambition of becoming cash breakeven in the medium term.
Right sized the business for growth
· Completed a reorganisation of the business to reduce overhead costs,
which included a reduction in the Board's size and cost - cash cost base
reduced to £0.5m per month (FY24 Q4 £0.7m).
· Lead Sulphide ("PbS") quantum dot production facility mothballed to
save cash costs while retaining the capability to turn this on at short
notice. We retain the ability to make sufficient levels of these quantum dots
to meet current market demands.
· Retained our capabilities to research, develop and manufacture a
variety of quantum dots at scale, whilst also allowing us to test the progress
of our materials on devices.
Leveraging our intellectual property portfolio
· We continue to assess and pursue opportunities to leverage our strong
and proven IP, particularly in relation to display applications.
Divestment of the Group's trading business (the "CDX process")
· Making progress on strategic options with CDX Advisors LLC ("CDX") -
contact made with a broad range of potential investors across relevant
industries globally, with several actively engaged
· Expect to receive initial proposals from potential bidders during the
summer. The Board will provide an update as appropriate in due course.
Results overview
Financial summary
· Reported revenue decreased to £3.4m (H1 FY24: £4.0m) due to the
previously announced cancellation of the contract with the European Customer.
· As a result of the fall in revenue, Adjusted EBITDA is also slightly
behind prior year at £0.5m (H1 FY24: £0.7m).
· Period end reported cash of £15.5m. Cash at 4 April 2025 £15.2m.
· During the period we completed the on-market buyback, fulfilling our
commitment to return £33 million to shareholders.
Full year outlook ahead of expectations
· Investment in business development is showing progress, with an
increasing number of potential commercial opportunities.
· Additional £311k revenue to be recognised in H2 of FY25 following
the completion of a settlement agreement with the European electronics
customer.
· As a result of completion of the settlement agreement with the
European electronics customer in addition to some other small commercial wins,
revenue for the year ended 31 July 2025 is now expected to be ahead of current
market expectations(2).
Dmitry Shashkov, Chief Executive Officer of Nanoco Group plc, said:
"Having been at Nanoco for almost six months, I am more confident than ever in
the commercial potential of our technology platform. Commercial traction takes
time and we have done the heavy lifting required to put in place the
foundations to drive a new go-to-market strategy.
We continue to accelerate the pace of our commercial development, especially
in the image sensors sector. As a result, we are in advanced negotiations to
add another Asian chemical customer to help drive commercialisation of QD
based SWIR sensors, and with other potential customers in the pipeline, I am
confident we will see early product revenues by next calendar year.
On the Flat Panel Display side, we also have some small-scale engagements that
cover both existing LCD architecture as well as newer technologies. And we
will continue to explore our licencing options. It is our conviction that our
extensive and validated IP portfolio will continue to deliver value to our
shareholders as we expand our IP licensing efforts.
We have the right strategy, a reinvigorated team and a relentless focus on
driving commercial engagement. In parallel, the CDX process is moving forward
at a good pace, with several active engagements. I look forward to further
updating shareholders on our progress on both initiatives in due course."
(1) Sources: Yole, IDTechEx
(2) The revenue forecast for FY25 is £6.6m, as prepared by Cavendish.
Investor Meet Company presentation for investors
There will be a further presentation for investors via the Investor Meet
Company platform on 22 April 2025 at 11:00am. Questions can be submitted live
or in advance via the Investor Meet Company Dashboard. Investors can sign up
to the Investor Meet Company platform for free and register their interest in
events hosted by Nanoco Group plc via:
https://www.investormeetcompany.com/nanoco-group-plc/register-investor
(https://www.investormeetcompany.com/nanoco-group-plc/register-investor)
Investors who already follow Nanoco Group plc on the Investor Meet Company
platform will automatically be invited.
For further information, please contact:
Nanoco Group plc:
Dmitry Shashkov,
CEO
+44 (0)1928 761 404
Liam Gray, CFO & Company Secretary
Sodali & Co
Elly
Williamson
+44 (0)79 3535 1934
Pete Lambie
Nanoco@sodali.com (mailto:Nanoco@sodali.com)
Cavendish Capital Markets Limited (Financial Adviser and Corporate Broker):
Ed Frisby / George Lawson (Corporate Finance)
+44
(0) 20 7220 0500
Tim Redfern / Charlie Combe (Corporate Broking)
Jasper Berry (Sales)
CDX Advisors (Financial Adviser):
Steven Foland
+1 415 425 2224
Steve Month
Patrick Foley
Notes for editors:
About Nanoco Group plc
Nanoco (LSE: NANO) is a nanomaterial production and licensing group,
specialising in the production of its patented cadmium free quantum dots
(CFQD®) and other patented nanomaterials for use in the electronics
industries. Founded in 2001 and headquartered in Runcorn, UK, Nanoco continues
to build out a world-class, patent-protected IP portfolio alongside its
existing scaled up production facilities for commercial orders.
Nanomaterials are materials with dimensions typically in the range 1 - 100 nm.
Nanomaterials have a range of useful properties, including optical and
electronic. Quantum dots are a subclass of nanomaterial that have
size-dependent optical and electronic properties. Within the sphere of quantum
dots, the Group exploits different characteristics of the quantum dots to
target different performance criteria that are attractive to specific markets
or end-user applications such as the Sensor, Electronics and Display markets.
Nanoco's CFQD® quantum dots are free of cadmium and other toxic heavy metals,
and can be tuned to emit light at different wavelengths across the visible and
infrared spectrum, rendering them useful for a wide range of display
applications. Nanoco's HEATWAVE™ quantum dots can be tuned to absorb light
at different wavelengths across the near-infrared spectra, rendering them
useful for applications including cameras and image sensors.
Nanoco is listed on the Main Market of the London Stock Exchange, holds the
LSE's Green Economy Mark, and trades under the ticker symbol NANO. For further
information please visit: www.nanocotechnologies.com
(http://www.nanocotechnologies.com)
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. Upon the publication of this announcement via a Regulatory Information
Service, this inside information is considered to be in the public domain.
Business Review
Company back on track with commercial development: revamped strategy, new
team, and exciting growth pipeline
During the Period, the Board outlined its new strategy to maximise value and
deliver returns for shareholders, namely;
· A significant reduction in the Group's cost base to minimise cash
burn and focus on commercial growth;
· The appointment of CDX Advisors LLC to pursue a sale of the Group's
trading business, Nanoco Technologies Ltd (the "CDX process"); and
· A commitment to return surplus cash to shareholders.
In order to drive both commercial progress and the execution of the Group's
strategy, Dmitry Shashkov was appointed CEO of the Group on 22 October 2024.
Dmitry's appointment was then reinforced by the appointments of Jalal Bagherli
as Non-Executive Chairman and the non-board appointment of Jai Subramanian as
Global Business Director.
This new strategy at a Group level is supported by a rapid refocusing of the
Company on commercial growth. With the appointment of the new CEO and
Chairman, and the establishment of the Nanoco commercial team on three
continents, we have developed a robust commercial pipeline with more than ten
individual customers and projects spanning Image Sensor, Flat Panel Display
and a few adjacent markets for quantum dots, such as Photovoltaic,
Agriculture, and Advanced Coatings and Paints.
With another major Asian image sensor potential customer now in the advanced
stages of negotiation, and a number of others in the pipeline, we are
confident that Nanoco is well on track to deliver commercial product revenues
in the 2026 calendar year.
Sensing
We have successfully completed Year 1 of the 2-year Joint Development
Agreement (JDA) with the Asian Chemical customer and met all the performance
requirements. As a result, the customer confirmed their commitment to the
project and we are now developing the scope of Phase 2 of this JDA, scheduled
to formally commence in the Autumn of 2025.
We are also in advanced negotiations with another major Asian chemical
potential customer, to enter a similar JDA for the development of heavy-metal
free quantum dot-based SWIR image sensor technology. This JDA will be another
source of service revenues for Nanoco and, when completed, will contribute to
further product revenue growth.
In addition, we have completed a comprehensive market screening for other
QD-SWIR opportunities and down-selected approximately ten companies as
business development targets for this technology. At this point in time, we
are already engaged with half of this group and are in the process of
establishing relationships with the rest.
Display
We are engaged with several Asian companies involved in existing Liquid
Crystal Display ("LCD") technologies. Due to the growing trend of substituting
cadmium ("Cd") based products with Cd-free, we see a near-term opportunity to
introduce Nanoco cadmium-free QDs into these established supply chains. Our
engagement is at different points of the supply chain, including both display
manufacturers and component (QD film) makers.
We continue to work with a UK based Aerospace and Defence customer for a niche
small volume display application.
Operations
Following the cancellation of our contract with the European Customer, we have
mothballed the Group's PbS QD production facility. It was built to accommodate
significant volumes of PbS quantum dots, and the demand for these at this
scale does not currently exist. However, we have continued to produce these at
a smaller scale, in addition to other species of quantum dots, for several
different customers.
Our new device lab is fully functioning and we have produced a number of
working devices using both Indium Arsenide ("InAs") and Indium Antimonide
("InSb") quantum dots. We continue to refine our process for device
development to ensure we have a strong feedback loop on the quantum dots we
are producing. Our new QC lab is also fully functional, allowing Nanoco to
reduce our outsourced QC costs and get feedback on both raw materials and
finished goods in a much more timely manner.
IP Licensing
Our primary goal for Nanoco is the development, scale up and commercial
production of nanomaterials. Our IP portfolio is primarily used to support
those objectives. However, we will also continue our efforts to agree
appropriate licensing of our technology and IP where other commercial
engagement may not be possible or appropriate.
We continue to explore options for further leveraging the value of our IP, and
will rigorously defend our IP where we believe this has been infringed and a
licensing agreement is not in place.
The CDX Process
We are making good progress with the ongoing CDX process to divest the Group's
trading business, Nanoco Technologies Limited. Following the appointment of
CDX Advisors, we focused on the preparation of due diligence materials and the
data room. We then conducted initial outreach to potentially interested
parties and are actively engaged with a number of potential acquirers. We
expect to receive initial proposals from potential bidders during the summer.
The Board will provide an update as appropriate in due course.
Board
During the period, in line with corporate governance best practice, Dr
Christopher Richards stepped down as Chairman and was replaced by Dr Jalal
Bagherli. The Non-Executive Directors on the Board continue to accrue pay in
shares instead of cash, representing 50% of salary, and this will be
re-assessed at the end of the financial year.
Outlook - strong foundations for organic growth
Market sector forecasts(1) for SWIR sensors and quantum dot-based display
technologies show strong growth over the next five years. In combination with
other QD market segments, the Company estimates an approximately $1.0B market
for quantum dots by 2029 across all applications.
In the Image Sensor market, we are seeing a strong trend towards heavy
metal-free materials, while in the Flat Panel Display market, a similar trend
favours cadmium-free technology. Both of these trends strongly benefit Nanoco,
with our pioneering development of CFQD™ cadmium-free quantum dots for
display markets and with a broad portfolio of HEATWAVE™ quantum dots for
Image Sensor markets, including heavy-metal free materials such as InAs and
InSb.
This creates a positive environment for us to leverage the strong performance
characteristics of Nanoco's unique and novel nanomaterials into large
mass-produced commercial applications.
In the Display market, we expect continued growth within the TV segment,
complemented by rapidly growing new segments within this market including
high-performance PC monitors and laptops. In the Image Sensor market, while
initial developments of QD-SWIR technology were embraced by Industrial and
Defence users, we expect that continuing cost/performance improvements will
lead to the insertion of QD-SWIR devices into Consumer and subsequently
Automotive markets.
In combination, these trends put Nanoco firmly on track of growing its product
revenues by 2026, with further growth coming from other applications of
quantum dots that require longer development.
Dmitry Shashkov
Chief Executive Officer
15 April 2025
(1) Sources: Yole, IDTechEx
Statement regarding Shareholder Consultation following the 2024 Annual General
Meeting
At the Nanoco Group Plc Annual General Meeting ("AGM") held on 21 January
2025, all resolutions proposed were approved by shareholders. Three of those
resolutions, being the re-appointment of Dr Alison Fielding as a Director of
the Company, the authority to disapply pre-emption rights and the authority to
disapply pre-emption rights in connection with an acquisition or specified
capital investment were supported by 77.8%, 77.4% and 77.4% of shareholders
respectively. While they passed with the necessary majority, these resolutions
received less than 80.0% of votes.
Consequently, in accordance with the UK Corporate Governance Code, the Company
engaged with a number of larger shareholders to solicit their feedback on
voting at the AGM, in particular on the resolutions referenced above. The
majority of shareholders we reached out to confirmed they had voted in favour
of these resolutions. One large shareholder did not engage despite a number of
attempts. The Board would like to thank all shareholders that took part in
engagement.
Financial review
Revenue
Reported revenue in the Period decreased 13% to £3.4m (H1 FY24: £4.0m). The
majority of revenue relates to recurring licence revenue, prepaid as part of
the litigation settlement.
Sources of revenue H1 FY25 H1 FY24 FY24
£m £m £m
Services 0.3 0.6 1.4
Material sales 0.1 0.3 0.4
Licences 3.0 3.1 6.1
Total revenue 3.4 4.0 7.9
Excluding the licence revenue, services continues to be the major revenue
driver, primarily from the on-going two-year JDA. The decrease on H1 FY24 was
due to the cancellation of the JDA with the European customer. Material sales
represents shipments of nanomaterials to supply chain partners in sensing and
display markets.
Operating expenses
Operating expenses comprise R&D and administrative expenses. Gross
investment in R&D to support the ongoing development of our nanomaterials
was £0.7m in the Period (H1 FY24: £0.8m) and administrative expenses were
£3.7m (H1 FY24: £3.0m). Following the loss of the European customer the
Group undertook a reorganisation to reduced overhead costs whilst maintaining
its core capabilities, which has reduced gross monthly cash burn to £0.5m per
month. These savings will be largely reflected in H2 of FY25.
Operating profit and adjusted EBITDA
The lower revenue in the Period directly impacted adjusted operating profit in
the Period, decreasing to a £0.2m loss. Adjusted EBITDA in the Period
decreased to £0.5m.
H1 FY25 H1 FY24 FY24
£m £m £m
Operating profit/(loss) (1.2) 2.4 1.7
Requisitioned general meeting 0.2 - -
Strategic review fees 0.2 - -
Restructuring costs 0.1 - -
Fair value gain on derivative financial instrument - (2.5) (1.8)
Foreign exchange - (0.2) (0.9)
Share-based payment charge 0.5 0.5 1.0
Employers NI on SBP 0.0 0.0 0.0
Adjusted operating profit/(loss) (0.2) 0.2 0.0
Depreciation 0.6 0.4 0.8
Amortisation 0.1 0.1 0.2
Impairment 0.0 0.0 0.2
Adjusted EBITDA 0.5 0.7 1.2
Management monitor Adjusted EBITDA as an Alternative Performance Measure. The
non-cash charges for share-based payments (including the associated national
insurance charges), depreciation and amortisation are added back to the
operating result to arrive at Adjusted EBTIDA. One-off cash costs, as well as
the one-off non-cash profit on revaluing the foreign currency hedge are also
excluded from Adjusted EBITDA. These items are excluded to provide users of
the accounts with a clearer understanding of underlying business performance.
Taxation
A deferred tax asset for brought forward losses expected to be utilised in
future years was recognised in FY24 and remains at the period end. The Korean
withholding tax on the Samsung licence agreement creates a UK tax asset of
£1.7m which can be offset against future tax liabilities (£0.1m of which has
been charged against current period profits).
Net result
The loss after tax for H1 FY24 was £1.0m (H1 FY24: profit of £1.8m).
Earnings per share
The basic loss per share was 0.53 pence per share (H1 FY24: profit of 0.54
pence). As at 31 January 2025 there were 194,608,038 ordinary shares in issue
(31 July 2024: 202,571,497) including treasury shares.
Cash position and liquidity
Following the completion of the return of capital to shareholders the Group
had a cash balance at 31 January 2025 of £15.5m (2024: £59.3m).
Working capital
The Group has reduced its investment in working capital following the loss of
the European customer. Our contracts with customers include mechanisms to give
Nanoco advance notice of significant changes in demand that should be adequate
to ensure that Nanoco has appropriate raw materials on hand when production
needs to be ramped up.
Principal risks
The Directors have considered the principal risks which may have a material
impact on the Group's performance. The majority of applicable risks throughout
the Period remained materially unchanged to those as disclosed on pages 33 to
35 of the 2024 Annual Report and Accounts.
Going concern
The interim condensed consolidated financial statements have been prepared on
a going concern basis. In determining the appropriate basis of preparation of
the financial statements, the Directors are required to consider whether the
Group can continue in operational existence for the foreseeable future.
For the purposes of assessing whether 'going concern' is an appropriate basis
for preparing the interim condensed consolidated financial statements, the
Directors have used their detailed forecasts for the period to 31 July 2028
(the "Forecast Period"). These reflect current and expected business
activities as well as the matters set out in the section above on Principal
risks.
A sensitivity analysis has been performed to reflect a possible downside
scenario that only includes already contracted revenues for the Forecast
Period.
On the basis of the information above and having made appropriate enquiries,
at the time of approving the interim condensed consolidated financial
statements, the Directors have a reasonable expectation that the Company has
access to adequate resources to continue in operational existence for the
foreseeable future, at least 12 months from the date of the issue of these
interim condensed consolidated financial statements.
Accordingly, they continue to adopt the going concern basis in preparing the
interim condensed consolidated financial statements. The financial statements
do not reflect any adjustments that would be required to be made if they were
prepared on a basis other than the going concern basis.
Liam Gray
Chief Financial Officer
15 April 2025
Responsibility statement
The Directors of Nanoco Group plc, as listed on pages 50 and 51 of the 2024
Annual Report and Accounts, excluding Dr Christopher Richards who stood down
at the AGM on 21 January 2025, confirm to the best of their knowledge:
a) the interim condensed consolidated financial statements have been
prepared in accordance with International Accounting Standard 34 Interim
Financial Reporting, as required by paragraph 4.2.4 of the Disclosure Guidance
and Transparency Rules ("DTR");
b) the interim condensed consolidated financial statements, which have
been prepared in accordance with the applicable set of accounting standards,
give a true and fair view of the assets, liabilities, financial position and
profit or loss of the issuer, or the undertakings included in the
consolidation as a whole as required by DTR 4.2.10;
c) the interim management report includes a fair review of the
information required by DTR 4.2.7 - an indication of important events which
have occurred during the first six months of the year and a description of the
principal risks and uncertainties for the remaining six months of the year;
and
d) the interim management report includes a fair review of the
information required by DTR 4.2.8 - the disclosure of related party
transactions occurring during the first six months of the year and any changes
in related party transactions disclosed in the 2024 Annual Report and
Accounts.
By order of the Board
Liam Gray
Chief Financial Officer
15 April 2025
Condensed consolidated statement of comprehensive income
For the six months ended 31 January 2025
H1 FY25 H1 FY24 FY24
(Unaudited) (Unaudited) (Audited)
Notes £'000 £'000 £'000
Revenue 3 3,448 3,956 7,874
Cost of sales (259) (429) (1,211)
Gross profit 3,189 3,527 6,663
Other operating income
Government grants 8 131 142
Fair value gain on derivative financial instrument - 2,476 1,814
Operating expenses
Research and development expenses (741) (755) (853)
Administrative expenses (3,705) (3,009) (6,059)
Operating (loss)/profit (1,249) 2,370 1,707
- Before share-based payments and non-recurring items (296) 368 850
- Share-based payments (458) (474) (957)
- Strategic review fees (210) - -
- EGM requisition costs (211) - -
- Restructuring costs (74) - -
- Fair value gain on derivative financial instrument - 2,476 1,814
Finance income 339 45 835
Finance expense (50) (324) (677)
(Loss)/profit before taxation (960) 2,091 1,865
Taxation (74) (332) (3,118)
(Loss)/profit after tax (1,034) 1,759 (1,253)
Other comprehensive income
Loss on exchange rate translations (7) - -
Total comprehensive (loss)/profit for the year (1,041) 1,759 (1,253)
(Loss)/profit per share:
Basic (loss)/earnings 4 (0.53p) 0.54p (0.43p)
Diluted (loss)/earnings 4 (0.53p) 0.51p (0.43p)
The (Loss)/profit for the current and preceding year arise from the Group's
continuing operations and is attributable to the equity holders of the Parent
Company.
The basic and diluted loss per share reported in H1 FY25 and FY24 are the
same, as the effect of share options is anti-dilutive.
Condensed consolidated statement of changes in equity
For the six months ended 31 January 2025
Capital Reverse Share-based Shares
Share Redemption acquisition payment Merger held Accumulated
capital Reserve reserve reserve reserve by EBT loss Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
At 31 July 2023 (audited) 32,443 - (77,868) 5,610 (1,242) (105) 57,575 16,413
Profit for the six months to 31 January 2024 - - - - - - 1,759 1,759
Issue of shares on option exercise - - - - - 105 - 105
Share-based payments - - - 474 - - - 474
At 31 January 2024 (unaudited) 32,443 - (77,868) 6,084 (1,242) - 59,334 18,751
Loss for the six months to 31 July 2024 - - - - - - (3.012) (3,012)
Share buy-back (12,186) 12,186 - - - (3,348) (29,683) (33,031)
Issue of capital to EBT on option exercise - - - (207) - - 5 (202)
Transfer of expired options - - - (4,788) - - 4,788 -
Share-based payments - - - 483 - - - 483
At 31 July 2024 (audited) 20,257 12,186 (77,868) 1,572 (1,242) (3,348) 31,432 (17,011)
Loss for the six months to 31 January 2025 - - - - - - (1,041) (1,041)
Share buy-back (796) 796 - - - 28 (1,045) (1,017)
Exercise of share options - - - (233) - 158 75 -
Share-based payments - - - 458 - - - 458
At 31 January 2025 (unaudited) 19,461 12,982 (77,868) 1,797 (1,242) (3,162) 29,421 (18,611)
Condensed consolidated statement of financial position
As at 31 January 2025
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) (Audited)
Notes £'000 £'000 £'000
Assets
Non-current assets
Tangible fixed assets 1,652 1,302 1,651
Right of use assets 1,827 2,442 2,188
Intangible assets 683 903 745
Deferred tax asset 2,350 2,573 2,350
Foreign withholding tax receivable 1,590 4,003 1,664
8,102 11,223 8,598
Current assets
Inventories 168 451 305
Trade and other receivables 1,010 3,660 1,083
Foreign withholding tax receivable 149 593 149
Income tax asset 235 - 235
Cash and cash equivalents 15,484 59,343 20,293
17,046 64,047 22,065
Total assets 25,148 75,270 30,663
Liabilities
Current liabilities
Trade and other payables (943) (1,619) (1,578)
Loans - (4,257) -
Lease liabilities 6 (693) (675) (621)
Income tax liability - (800) -
Deferred revenue 5 (5,944) (5,934) (5,934)
(7,580) (13,285) (8,133)
Non-current liabilities
Lease liabilities 6 (917) (1,418) (1,288)
Provisions (659) (659) (659)
Deferred revenue 5 (34,603) (40,582) (37,594)
Loans - (575) -
(36,179) (43,234) (39,541)
Total liabilities (43,759) (56,519) (47,674)
Net (liabilities)/assets (18,611) 18,751 (17,011)
Capital and reserves
Share capital 19,461 32,443 20,257
Capital redemption reserve 12,982 - 12,186
Reverse Acquisition Reserve (77,868) (77,868) (77,868)
Share-based payment reserve 1,797 6,084 1,572
Merger reserve (1,242) (1,242) (1,242)
Shares held by EBT (3,162) - (3,348)
Accumulated profit/(loss) 29,421 59,334 31,432
Total equity (18,611) 18,751 (17,011)
Approved by the Board and authorised for issue on 15 April 2025.
Dmitry
Shashkov
Liam Gray
Chief Executive
Officer
Chief Financial Officer
Condensed consolidated cash flow statement
For the six months ended 31 January 2025
Six months to Six months to Year to
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) Audited
£'000 £'000 £'000
Profit/(loss) before tax (960) 2,091 1,865
Adjustments for:
Net finance (income)/expense (289) 279 (158)
Fair value gain on derivative financial instrument - (2,476) -
(Profit) / loss on exchange rate translations 5 (183) (852)
Depreciation of tangible fixed assets 201 38 117
Depreciation of right of use asset 376 328 698
Amortisation of intangible assets 96 97 224
Impairment of intangible assets 2 20 132
Share-based payments 458 474 957
(Profit) / loss on disposal of tangible fixed assets - - 2
Increase/(decrease) in inventory provision 150 - 93
Changes in working capital:
(Increase)/decrease in inventories (13) (143) (90)
Decrease in trade and other receivables 73 32,802 33,459
(Decrease)/increase in trade and other payables (635) (1,060) (1,209)
Increase/(Decrease) in deferred revenue (2,981) 22,592 19,604
Cash inflow/(outflow) from operating activities (3,517) 54,859 54,842
Foreign withholding tax paid - (2,550) (2,566)
Tax paid - - (797)
Net cash outflow from operating activities (3,517) 52,309 51,479
Cash flows from investing activities
Purchases of tangible fixed assets (203) (1,036) (1,466)
Purchases of intangible fixed assets (38) (54) (135)
Proceeds from sale of tangible fixed assets - - -
Proceeds from sale of intangible fixed assets - - -
Interest received 339 45 785
Net cash outflow from investing activities 98 (1,045) (816)
Cash flows from financing activities
Purchase of shares to satisfy options - - (97)
Return of capital to shareholders (1,010) - (32,000)
Fees on return of capital to shareholders (7) - (1,027)
Repayment of loan - capital - - (3,550)
Repayment of loan - interest - - (1,528)
Payment of lease liabilities (capital) (314) (259) (558)
Payment of lease liabilities (interest) (48) (51) (103)
Interest paid (3) (2) (57)
Net cash outflow from financing activities (1,382) (312) (38,920)
Increase / (Decrease) in cash and cash equivalents (4,801) 50,952 11,743
Cash and cash equivalents at the start of the period 20,293 8,207 8,207
Effects of exchange rate changes (8) 184 343
Cash and cash equivalents at the end of the period 15,484 59,343 20,293
Notes to the interim condensed consolidated financial statements
For the six months ended 31 January 2025
1. Corporate information
Nanoco Group plc (the "Company"), a public company limited by shares, is on
the equity shares (commercial companies) list of the London Stock Exchange and
is incorporated and domiciled in the UK. The Group Interim Report and Accounts
for the six months ended 31 January 2025 was authorised for issue in
accordance with a resolution by the Directors on 15 April 2025.
These interim condensed consolidated financial statements include the
financial statements of Nanoco Group plc and the entities it controls (its
subsidiaries).
These interim condensed consolidated financial statements are unaudited and do
not constitute statutory accounts of the Group as defined in section 434 of
the Companies Act 2006.
2. Accounting policies
a. Basis of preparation
These interim condensed consolidated financial statements have been prepared
in accordance with the Disclosure and Transparency Rules of the Financial
Conduct Authority, UK-adopted IAS 34 Interim Financial Reporting, using the
recognition and measurement principles of UK-adopted IFRS and have been
prepared under the historical cost convention. As required by the Disclosure
Guidance and Transparency Rules of the Financial Conduct Authority the
accounting policies adopted in these condensed consolidated financial
statements are consistent with those followed in the preparation of the
Group's Annual Report and Accounts for the year to 31 July 2024.
These interim condensed consolidated financial statements include audited
comparatives for the year to 31 July 2024. The 2024 Annual Report and
Accounts, which was prepared in accordance with UK-adopted International
Financial Reporting Standards ("IFRS"), received an unqualified audit opinion
and have been filed with the Registrar of Companies. The financial statements
of the Group for the year ended 31 July 2024 are available from the Company's
registered office, or from the website www.nanocotechnologies.com.
b. Presentation of figures
Certain figures contained in this announcement, including financial
information, have been subject to rounding adjustments. Accordingly, in some
cases, the sum or percentage change of the numbers contained in this
announcement may not conform exactly to the total figure given.
c. Going concern
The interim condensed consolidated financial statements have been prepared on
a going concern basis as set out in the Financial Review section.
d. Use of estimates and judgements
Preparation of the interim condensed consolidated financial statements
requires management to make judgements, estimates and assumptions affecting
the application of accounting policies and the reporting of assets,
liabilities, income and expenses. Actual results may differ from these
estimates. The significant judgements made by management in applying the
Group's accounting policies and key sources of estimated uncertainty were the
same as those applied to the consolidated financial statements for the year
ended 31 July 2024. These are summarised below:
Estimates Judgements
Period over which to amortise Samsung licence Revenue recognition
Equity-settled share-based payments Samsung licence of IP
Deferred tax Capitalisation (or not) of research and development expenditure
Going concern
3. Segmental information
Operating segments
At 31 January 2025 and 2024, the Group operated as one segment, being the
research, development and manufacture of products and services based on high
performance nanoparticles. This is the level at which operating results are
reviewed by the chief operating decision maker (i.e. the Board) 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.
Six months to Six months to Year to
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Analysis of revenue - by type
Products sold 60 341 408
Rendering of services 416 544 1,410
Licences 2,972 3,071 6,056
3,448 3,956 7,874
There were two material customers who generated product and service revenue of
£442,000 (2024: one material customer amounting to £575,000). £2,972,000 of
the licence revenue related to the Samsung licence (2024: £3,028,000)
The Group operates in a number of countries across the world, although all are
managed in the UK. The Group's revenue per country based on the customer's
location is as follows:
Six months to Six months to Year to
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Analysis of revenue - by geography
South Korea 2,972 3,028 6,013
Netherlands 174 307 926
Japan 268 292 573
France - 267 268
Taiwan - 43 42
USA - 17 46
Belgium - 2 2
Canada - - 3
UK 34 - 1
3,448 3,956 7,874
All the Group's assets are held in the UK and all of its capital expenditure
arises in the UK. The loss before taxation and attributable to the single
segment was £960,000 (2024: £2,091,000 profit).
4. Earnings per share
Six months to Six months to Year to
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Profit/(loss) for the period attributable to equity shareholders (1,041) 1,759 (1,253)
Share-based payments 458 474 957
Profit/(loss) for the period before share-based payments 2,233 (296)
(583)
Weighted average number of shares No. No. No.
Ordinary shares in issue 196,522,718 324,430,950 288,791,171
Options exercisable at the reporting date 990,407 1,134,244 160,664
Options not yet exercisable at the reporting date 15,649,778 19,727,115 12,717,665
Diluted weighted average number of shares 213,162,903 345,292,309 301,669,500
Adjusted profit/(loss) per share before share-based payments (pence) (0.30) 0.69 (0.10)
Basic profit/(loss) per share (pence) (0.53) 0.54 (0.43)
Diluted adjusted profit/(loss) per share before share-based payments (pence) (0.30) 0.65 (0.10)
Diluted profit/(loss) per share (pence) (0.53) 0.51 (0.43)
Diluted loss per share is not presented for the 6 months to January 2025 and
the year to July 2024 as the effect of share options issued is anti-dilutive.
The adjusted loss is presented as the Board measures underlying business
performance which excludes non-cash IFRS2 charges.
5. Deferred revenue
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Current
Upfront licence fees 5,944 5,931 5,934
Milestone Payments - 3 -
Total current 5,944 5,934 5,934
Non-current
Upfront licence fees 34,603 40,582 37,594
Total non-current 34,603 40,582 37,594
Total deferred revenue 40,547 46,516 43,528
Deferred revenue arises under IFRS where upfront licence fees are accounted
for on a straight-line basis over the initial term of the contract or where
performance criteria have not been satisfied in the accounting period.
6. Lease liabilities
Six months to Six months to Year to
31 January 31 January 31 July
2025 2024 2024
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Current
Property Leases 691 662 612
Equipment leases 2 13 9
Non-current
Property Leases 917 1,407 1,284
Equipment leases - 11 4
Total lease liabilities 1,610 2,093 1,909
7. Post Balance Sheet Event
On 27(th) February 2025, the Group signed a final termination agreement with
its European customer following the cessation of work announced on 30 August
2024. Under the agreement Nanoco will receive £588,000 as a final settlement
of all outstanding accounts. £277,000 of revenue has already been recognised
for work performed up to the end of the contract and the additional £311,000
will be recognised as revenue in H2 FY25.
- Ends -
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