QXT.L Regulatory News (QXT)

The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.

22 July 2020

Quixant plc

("Quixant" or the "Company" or the "Group")

Trading update and Notice of Results

Solid net cash position supported by robust Densitron trading

Quixant (AIM: QXT), a leading provider of innovative, highly engineered technology products principally for the global gaming and broadcast industries, is pleased to provide an update on trading for the six months ended 30 June 2020 (the "Period").

The board is pleased with the performance of Densitron, the Group's business unit specialising in human machine interaction for markets outside gaming. Densitron has experienced healthy demand from a range of industrial sectors during the Period with a highlight being the medical market which has seen elevated demand from new and existing customers for our range of display products. This sector represents an exciting growth area for the Group and management is actively exploring further organic growth opportunities. Additional strategic business wins in the broadcast sector with customers such as Panasonic leave Densitron well-positioned for growth as the economy emerges from lockdown.

Gaming, which is the key market for the Group, has seen only minimal orders during the past three months, with most of the Group's gaming clients closed due to the Covid-19 pandemic. Casinos and other gaming venues, however, started to reopen during the latter part of the second quarter and, whilst the speed of recovery of this part of the Group's revenues cannot be predicted, the Group has seen an improvement in activity in June. The downturn in revenues has been mitigated by the implementation of a swift overhead cost reduction programme and a streamlining of the Group's product base which, whilst thorough, have been implemented so as to both leave the Group well-positioned to support customers in their recovery and also explore new opportunities for growth.

The board is also pleased with the Group's working capital position in the Period. Densitron's robust trading performance combined with strong collection of receivables from the Group's gaming customers and the benefits of a swiftly executed cost management programme has yielded a solid net cash position at 30 June 2020 of $14.2m (31 December 2019: $16.1m). The Group also has additional unutilised lines of credit of over $12.4m, including a new $9.4m UK Government-backed Barclays revolving credit facility, should additional facilities be required.

The board expects to announce its results for the six months ended 30 June 2020 on 30 September 2020.

Jon Jayal, Chief Executive of Quixant, commented: 

"Given the economic circumstances, I am pleased with the performance of the Group in the first six months of the financial year. Our Densitron business, which celebrates its 50-year anniversary in 2020 has performed well and has demonstrated the benefits of a diverse revenue base, and an ability to withstand economic shocks.

"Our strong net cash position entering the pandemic has remained largely intact, supported by robust Densitron trading, a swiftly executed cost reduction programme and sustained cash collection from our gaming customers, who have appreciated the flexibility and partnership we have offered them in this challenging period. I am pleased to see some early signs of activity beginning to return for some of our gaming clients.

"Quixant's strength of customer relationships and flexibility of approach has enabled the Group to drive some exciting evolutions in our offering and business model during the past few months. This, combined with our solid balance sheet, places the Company in a strong position to grow over the longer term."

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About Quixant

Quixant, founded in 2005, was established as a designer and manufacturer of highly optimised computing solutions and display solutions for the global gaming industry. Through the acquisition of Densitron Technologies plc in 2015, the Company diversified into other markets and has a focused technology offering for the broadcast sector, leveraging the business' extensive sector knowledge across many industries.

The Company is headquartered in Cambridge in the UK, with a global customer base and offices in North America, Europe and Asia. The Taiwanese operation is responsible for design, procurement and manufacturing of the Company's products. Quixant owns all its IP, some of which is protected by patents and design rights.

In-depth information on the Company's products, markets, activities and history can be found on the corporate website at www.quixant.com.