Kromek final year results 2017-2018

Final Results for the Year ended 30 April 2018

Announcing the Kromek final year results 2017-2018, final audited results for the year ended 30 April 2018.

 Financial Highlights

• Revenue increased 32% to £11.8m (2016/17: £9.0m)
• Product sales accounted for 81% of total revenues (2016/17: 74%), a growth year-on-year of 44%
• Gross margin was 56.4% (2016/17: 57.1%)
• EBITDA* was £0.5m profit (2016/17: £1.5m loss)
• Loss before tax for the year was £2.5m (2016/17: £3.8m loss)
• Cash and cash equivalents at 30 April 2018 were £9.5m (31 October 2017: £15m)

*EBITDA defined as earnings before interest, taxation, depreciation, amortisation, other income and share-based payments. For a reconciliation, see the Financial Review below.

 Operational Highlights

• Milestone year as revenue growth from ramp-up in commercial activities enabled Kromek to achieve EBITDA positive for the first time
• Growth due to continued delivery on previously-signed agreements as well as commencing delivery on new high-value contracts won during the year
• Secured new purpose-built premises for Kromek’s US operations in Pittsburgh, which will enable the facility to become a world-leading manufacturer of SPECT cameras

Medical Imaging

The Group’s CZT-based SPECT cameras and BMD detectors produce superior quality and higher resolution digital images that significantly advance the early identification of disease, such as cancer, dementia and osteoporosis.

• Secured a five-year contract, worth a minimum of $5.38m, to incorporate Kromek’s CZT-based detector modules in a new osteoporosis product offering for an existing BMD customer
• Awarded a three-year £1.4m programme by Innovate UK to deliver a Low Dose Molecular Breast Imaging Device based upon the Group’­s CZT-based SPECT detectors
• Won a five-year repeat order, post-period end, worth $1.2m, from an existing medical customer for the supply of gamma detector modules for incorporation in the customer’s products
• Advanced towards achieving the first clinical validation of Kromek’s CZT-based SPECT detector system

Nuclear Detection

The D3S is the world’s most advanced, portable, nuclear radiation detection device used by counter-terrorist agencies to protect civilians and key infrastructure in cities, including ports, borders and transport hubs. Kromek’s portfolio also includes a range of high-resolution detectors and measurement systems for the civil nuclear markets used in nuclear power plants, research and for other applications.

• Awarded a $1.6m extension to its DARPA contract to add further technical innovation capability to the Kromek D3S family of equipment
• D3S continued to be deployed and field-tested in major areas in the US by DARPA, and by other public administrations across the globe, including by European authorities during the visit of the President of the United States to Brussels in May 2017
• Named as a qualified contractor under the $8.2bn U.S. Department of Defense IDIQ for the Joint Enterprise – Research, Development, Acquisition, and Production/Procurement contract award vehicle following extensive due diligence
• Strengthening and expansion of distribution channels in the civil nuclear markets, and completion of deployment of Quant for GR1 product in all UK EDF nuclear power plants

Security Screening

The Group’s security screening solutions are being incorporated into the next generation liquid and luggage scanners. These upgraded machines are replacing legacy machines and are enhancing the safety of passengers while minimising the inconvenience of the security process at airports.

• Commenced work on the Group’s first long-term security screening contract: a five-year, $3.1m agreement with an existing US-based customer to provide OEM components for baggage screening products used in aviation security
• Won a five-year, $2.0m contract, from a new OEM customer, which has commenced incorporating Kromek’s technology into its baggage security screening systems to enhance detection of an extensive range of threat materials

Seven new patents were filed and 29 granted during the period.

Commenting on the Kromek final year results 2017-2018

Dr Arnab Basu, CEO of Kromek, said: “I am very pleased to report that Kromek had another good year of delivering revenue growth and developing our customer base who continue to launch next-generation products incorporating our advanced radiation detectors. We also achieved one of our key targets for the year by becoming EBITDA positive for the first time in our history. This is an important milestone towards cash flow breakeven and pre-tax profits.

“Looking ahead, the momentum of the 2017/18 financial year has been sustained into the current financial year as Kromek’s products continue to gain traction in all of our target markets from the increasing adoption of CZT-based technology and other products. We continue to win new customers and, together with executing on previously-won contracts, Kromek expects to deliver growth across its business segments and to report continued revenue growth for 2018/19 in line with market expectations.”

See the full announcement here.

See Aranb Basu talk about the results with Proactive Investor.