Kromek (AIM: KMK), a leading developer of radiation and bio-detection technology solutions for the advanced imaging and CBRN detection segments, announces its final results and gives notice of the publication of its annual report for the year ended 30 April 2024.
Financial Summary
- Revenue increased 12% to £19.4m (2023: £17.3m)
- Gross margin improved to 55.2% (2023: 51.6%) due to further efficiencies and sales mix
- Achieved positive adjusted EBITDA of £3.1m (2023: £1.0m loss)* ahead of market expectations
- Loss before tax was reduced to £3.5m (2023: £7.3m loss)
- Debt facility refinanced with new £5.5m secured term loan
- Cash and cash equivalents at 30 April 2024 were £0.5m (30 April 2023: £1.1m)
*A reconciliation of adjusted EBITDA can be found in the Financial Review.
Operational Highlights
Advanced Imaging
- Strong revenue growth with delivery under landmark contracts and other component supply agreements
- Significant progress in medical imaging:
- Entered a collaboration agreement with a blue-chip technology solutions provider to develop detectors based on cadmium zinc telluride (“CZT”) for photon counting computed tomography (“PCCT”) applications in the medical imaging sector
- Commenced work under the landmark collaboration agreements with a recognised tier 1 OEM and with Analogic that were signed at the end of the prior year
- Received and largely delivered an order worth $1.4m from a new OEM customer that is an established player in the medical imaging sector in Asia
- Spectrum Dynamics Medical has launched the latest addition to its next-generation digital single photon emission computed tomography (“SPECT”)/computed tomography (“CT”) imaging portfolio, the VERITON-CT 300, which uses Kromek’s digital detectors
- Continued to make progress under the ultra-low dose molecular breast imaging programme funded by Innovate UK
- Secured a new $2.1m order to supply detector components for the security screening systems of an existing US-based OEM customer in the homeland security marketplace
CBRN Detection
- Geopolitical insecurity continued to drive strong demand in nuclear security with the winning and delivery of new and repeat orders, including:
- A £1.4m order to supply D3M detectors and associated networkable solutions for use in the rescEU stockpile being developed by the European Commission
- A contract, worth up to $2.9m, from a US federal entity for the provision of Kromek’s D5 RIID, D3M and D3S-ID detectors
- An order from a substantial global defence corporation, which the Group believes represents a significant opportunity for further sales
- Post year end, awarded a contract worth £2.0m from the Ministry of Defence for the supply of the Group’s D5 RIID along with its Alpha Beta probe attachment and ancillary products
- The majority of the above will be delivered in year ending 30 April 2025, giving the Group good visibility into the new financial year
- Selected under two new UK government frameworks, each lasting four years, designed to enhance the UK’s systems and capabilities for ensuring public safety and security
Biological-Threat Detection
- Continued to progress the development of a biological-threat detection system under a contract that had been awarded in the previous financial year by a UK government department
- Awarded Kromek’s first contract in biosecurity from the US Department of Homeland Security, worth $5.9m, for the development of technologies focusing on an agent agnostic bio-detection system, under a four-year programme
Manufacturing and IP
- Continued to execute on programmes for the expansion of production capacity and process automation, resulting in greater manufacturing productivity and cost efficiency
- Applied for 3 new patents and had 7 patents granted across 6 patent families, with the total number of patents held being in excess of 210
Dr Arnab Basu, CEO of Kromek, said: “This has been a pivotal 12 months for Kromek where we recorded a third consecutive year of revenue growth and delivered on all our KPIs. We achieved record revenues, more than halved our losses and our positive adjusted EBITDA exceeded market expectations. We have actively enhanced our operational efficiencies and seen excellent progress in both advanced imaging and CBRN detection where demand remains strong across both market segments. We expect to be broadly cash neutral in H1 and are comfortable that we have sufficient capital to deliver further growth in 2025.
“Looking ahead, we anticipate demand for our CBRN products will continue to be driven by global geopolitical insecurity and the persistence of nuclear threats. Also, an acceleration in the development and commercialisation of SPECT, CT and BMD utilising CZT by major OEMs is expected to translate into increased collaborations, strategic partnerships and more contracts for the advanced imaging segment. Consequently, Kromek is well positioned to deliver future growth and value for shareholders.”
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