14 Jul 2022 07:00
The information contained within this announcement is deemed by the Company to constitute inside information pursuant to Article 7 of EU Regulation 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 as amended.
14 July 2022
Quixant plc
("Quixant" or the "Group")
Trading Update and Notice of Results
Strong demand drives FY22 revenue and profit upgrade
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 2022 and outlook for the remainder of 2022.
Trading
The strong demand across both Gaming and Densitron businesses seen in 2021 has continued in the first half of 2022, with order intake during the period ahead of first half revenues and prior year bookings.
Group revenue for H1 is expected to be $53.3m, 46% up year-on-year and the highest first half revenue performance since 2017, and ahead of management expectations. The recovery in the Gaming division has continued with first half revenues of $31.4m, a 71% increase on the previous year. Densitron is expected to deliver revenue of $21.9m in the first half, 21% up on H1 2021, delivering the strongest half year performance since acquisition in 2015.
| Six months ended 30 June 2022 |
| Six months ended 30 June 2021 |
| Change |
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| ($m) | ($m) |
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Group Revenue | 53.3 | 36.5 | 46% | |||
Gaming Division Revenue | 31.4 | 18.4 | 71% | |||
Densitron Revenue | 21.9 |
| 18.1 |
| 21% | |
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Supply chain constraints continue to impact the availability of key components but the strategic stock purchase programme, which has been operating since January 2021, has allowed the Group to manage these challenges well and continue to supply product to meet customer demand. We expect this industry-wide issue to persist until at least the first half of 2023. Supply chain issues also continue to lead to component price volatility impacting gross margins, although the Group is seeing early signs of gross margin recovery. The Group is not immune to global inflationary pressures leading to increased operating costs which are being managed, together with making investments to support future growth.
The Group's net cash position at 30 June 2022 was $12.0m (31 December 2021: $17.6m), reflecting the Group's continued investment in stock to mitigate the impact of the global supply chain constraints and meet customer demand.
Outlook
Trading in the first half was ahead of management expectations reflecting the continued recovery in the Gaming division, good momentum in Densitron and resilient supply chain management. The Group enters the second half of 2022 with an order book which gives good visibility of full year trading. Despite inflationary pressures, we now expect revenue and profit to be ahead of market expectations1.
Notice of Results
The Board expects to announce its results for the six months ended 30 June 2022 on 6 September 2022.
Jon Jayal, CEO of Quixant, commented: "It is extremely pleasing to report such strong trading in the first half of the year giving us confidence in ongoing growth, underpinned by buoyant order intake. The business has risen to the ongoing challenges presented by the electronic component market shortages and worked tirelessly with all stakeholders to mitigate the effects on our customers. We enter the second half of the year with confidence of continued strength in trading and therefore expect full year revenues and profit to be ahead of market expectations1. "
1 The current range of forecasts for the year ended 31 December 2022 is revenue of between $95.5m and $95.8m with a consensus of $95.7m and adjusted profit before tax of $7.8m.
Quixant plc Jon Jayal, Chief Executive Officer Johan Olivier, Chief Financial Officer
| Tel: +44 (0)1223 892 696 |
Nominated Adviser and Broker: finnCap Ltd Matt Goode / Simon Hicks (Corporate Finance) Alice Lane / Charlotte Sutcliffe (ECM)
| Tel: +44 (0) 20 7220 0500 |
Joint Broker: Canaccord Genuity Limited Simon Bridges / Andrew Potts
| Tel: +44 (0) 20 7523 8000 |
Financial PR: Alma PR John Coles / Hilary Buchanan / Kieran Breheny | Tel: +44 (0)20 3405 0205 |
About Quixant
Quixant, founded in 2005, designs and manufactures highly optimised computing solutions and monitors principally for the global gaming and broadcast industries. The Company is headquartered in Cambridge in the UK, with offices throughout Europe, North America and Asia. Quixant has its own manufacturing and engineering operation based in Taiwan and software engineering and customer support teams based in Italy and Slovenia. All the specialised products software and manufacturing are produced in-house and Quixant owns all its own IP some of which is protected by patents and design rights.
In November 2015 Quixant acquired Densitron Technologies plc. Densitron has a strong heritage in the sale of electronic display solutions to global industrial markets. Through Densitron's experienced sales team, Quixant has a robust platform to build its business into wider industrial markets. In-depth information on the Company's products, markets, activities and history can be found on the corporate website at www.quixant.com.