FireAngel makes positive first-half progress

(Sharecast News) - Home safety technology company FireAngel reported positive first-half progress on Tuesday, describing improved performance, and sales growth in-line with its expectations.
The AIM-traded firm said sales for the six-month period ended 30 June were expected to be "materially ahead" of the prior year period at £22.3m, up from £16.5m, with a "materially reduced" operating loss of £1.3m, compared to the £2.7m loss reported a year earlier.

Its board described that as a "strong recovery", with a return to a positive EBITDA of £0.3m reported, swinging from its first-half EBITDA loss of £0.8m in 2020.

FireAngel said that, while Covid-19 restrictions and ongoing challenges in global supply chains reduced its ability to fully exploit growing demand for its connected products, the company did remain "on track".

The group continued to deliver against its strategy to expand gross margins, which increased to 24% in the first half of 2021, from 22.2% in the first six months of 2020 and 19% in the same period of 2019.

That was driven by a higher sales mix of the firm's connected products, and planned operational improvements, which attracted wider margins.

As at 30 June, following the company's successful equity fundraising on 30 April, FireAngel had £5.8m in cash and £3.6m of debt, excluding IFRS 16 lease liabilities.

The net proceeds of that fundraising had been used to strengthen the company's balance sheet, while it continued to focus on product development.

Use of the warranty provision was tracking to forecasted levels, the board said.

Although global supply chain challenges had "frustrated" the planned second quarter increase in inventory, the company said it now expected to build inventory across the second half to meet expected growth.

"The board is pleased that the company has remained on track and made good progress against our strategy, despite being partially restrained by recent supply chain issues and some continuing Covid-19 restrictions," said executive chairman John Conoley.

"We are working on a range of mitigations to protect ourselves as much as possible against similar potential supply chain challenges going forward."

Conoley said the firm's board was "satisfied" that the execution of elements within its own control had gone to plan, and were beginning to benefit its financial performance.

"It is promising to see that market demand, especially for our connected products, remains strong and is growing."

FireAngel said it would release its unaudited interim results for the six months ended 30 June in late September.

At 0944 BST, shares in FireAngel Safety Technology Group were up 3.03% at 17p.