Last checked at 27 Feb 2014 07:00
27 February 2014
Digital Barriers plc
("Digital Barriers" or the "Group")
Trading Update
The Board of Directors (the "Board") of Digital Barriers (LSE AIM: DGB), the specialist provider of advanced surveillance technologies to the international homeland security and defence markets, provides an update on trading for the current financial year, ending on 31 March 2014.
As a result of delays to certain sales closures the Board now expects that Group revenues for the period will be slightly below last year (FY13: £23.3m). The delays are the result of both protracted customer procurement processes and internal delays in releasing new products in response to customer demand. As a result of this revenue shortfall, losses will be adversely impacted and are expected to be approximately 40% higher than last year (FY13: Adjusted Loss before Tax* £7.6m). Cash at the year-end is expected to be in line with market expectations at approximately £14.0m.
In spite of these delays, the Board re-iterates its aim, initially expressed in October 2013, of reaching break-even and operational positive cash flow in the year ending 31 March 2015. A number of factors support this confidence.
During the second half of the current financial year the Board has accelerated a planned rationalisation of the Group's cost base to concentrate resources on a number of strategic products, principally variants of its TVI technology. This rationalisation has incurred cash costs of approximately £0.5m this year, but is expected to deliver annualised cost savings in excess of £3.0m in FY15.
The Group's sales pipeline remains strong and numerous significant sales are expected to close in the next few months which will contribute to revenues in the next financial year. The first of these, awarded in February 2014 is worth in excess of £2.0m and will be recognised in the first half of FY15.
Tom Black, Executive Chairman of Digital Barriers commented:
"Despite these delays, we still have a very strong sales pipeline and product portfolio which should lead to material progress in the coming months. The strategic opportunity for Digital Barriers remains unchanged and the Board remains optimistic about our longer-term prospects."
* As shown in the Consolidated Income Statement
For further information, please contact:
Digital Barriers plc | Tel: 020 7940 4740 |
Tom Black, Executive Chairman | |
Colin Evans, Executive Director | |
Investec Investment Banking | Tel: 020 7597 5970 |
Andrew Pinder | |
Patrick Robb | |
FTI Consulting | Tel: 020 7831 3113 |
Matt Dixon Edward Bridges | |
Elodie Castagna |
About Digital Barriers
Digital Barriers provides advanced surveillance technologies to the international homeland security and defence markets, specialising in 'edge-intelligent' solutions that are designed for remote, hostile or complex operating environments. We work with governments, multinational corporations and system integrators in the defence, law enforcement, critical infrastructure, transportation and natural resources sectors. Our surveillance technologies have been successfully proven on some of the most demanding operational and environmental deployments around the world.
www.digitalbarriers.com