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Trackwise Designs (TWD)

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Wednesday 15 September, 2021

Trackwise Designs

Interim Results

RNS Number : 7849L
Trackwise Designs PLC
15 September 2021
 

TRACKWISE DESIGNS PLC

("Trackwise" or the "Company")

 

Interim Results for the six months ended 30 June 2021

 

Trackwise Designs (AIM: TWD), a leading provider of specialist products using printed circuit technology, is pleased to announce today its interim results for the six months ended 30 June 2021.

 

Financial highlights

· Revenues of £4.1m (H1 2020: £2.4m)

· IHT revenues of £0.58m (H1 2020: £0.25m)

· Gross margin of 29% (H1 2020: 17.8%)

· Adjusted1 E BITDA of £0.45m (H1 2020: £0.10m)

· Adjusted2 o perating loss of £0.13m (H1 2020: £0.37m)

· Reported loss after tax of £0.57m (H1 2020: profit £0.92m) after additional deferred tax provisions to reflect the change in Corporation Tax rate

· Net cash3 of £2.6m (£4.8m gross of borrowings) (31 December 2020: £11.4m), following investment at new Stonehouse site; mortgage finance then in place August 2021

· Basic EPS of (2.00) (loss) pence per share (H1 2020: 4.98 pence (profit))

 

1 Before share based payments; and in addition in the prior year before acquisition expenses, excluding a negative goodwill (credit) arising on the acquisition of SCL and excluding a small FX gain

2 Prior year included the benefit of a £1.6 million negative goodwill (credit) arising on the acquisition of SCL

3 Cash less borrowings, excluding IFRS16 right of use lease liabilities

 

Operational highlights

· Acquisition of a 77,000 sq. ft. freehold property in Stonehouse, Gloucestershire, for £2.8 million , to provide additional IHT production capacity

· Capital investment programme for the facility, aligned with the Electric Vehicle customer's proposed OEM product delivery schedule of early 2022

· Further investment in people including the appointment of a Chief Operating Officer to oversee the Group's day-to-day operational functions, including the fit out of the Stonehouse site  

· Growing number of enquiries, with the number of IHT total customers and opportunities increasing to 97 at 30 June 2021 (30 June 2020: 82)

 

Outlook

· While trading continues to be impacted by supply constraints and inflation, the Group is well-positioned to manage these pressures and is tracking in line with market expectations for the full year

 

 

Philip Johnston, CEO of Trackwise, commented :

 

"The development of our third manufacturing site at Stonehouse continues, and we expect to see this completed early in 2022 to meet production demand from our EV OEM customer.

 

More widely, we are confident in the opportunities ahead in IHT and we are seeing a fast-growing number of prospects for the application of this technology across our chosen markets. Alongside this, our Advanced PCBs division continues to deliver solid revenues.  

 

We are positive about the prospects for future growth for Trackwise and we look forward to providing further updates on our progress to the market."

 

Enquiries

 

Trackwise Designs plc  

+44 (0)1684 299 930

Philip Johnston, CEO   

www.trackwise.co.uk

Mark Hodgkins, CFO 

 

 

 

finnCap Ltd

+44 (0)20 7220 0500

NOMAD and Broker

 

Ed Frisby/Tim Harper - Corporate Finance 

Andrew Burdis/Barney Hayward - ECM

 

 

 

Alma PR

+44 (0)20 3405 0205

Financial PR and IR

 

David Ison/Caroline Forde/Josh Royston/Kieran Breheny

 

 

 

Notes to editors

 

Trackwise is a UK-based manufacturer of specialist products using printed circuit technology.

 

The full suite includes: Improved Harness Technology™ ("IHT") and Advanced PCBs - Microwave and Radio Frequency ("RF"), Short Flex, Flex Rigid and Rigid Multilayer products.

 

IHT uses a proprietary, patented process that Trackwise has developed to manufacture multilayer flexible printed circuits of unlimited length. While the technology has many applications, the directors expect that one of its primary uses will be to replace traditional wire harness in a variety of industries.

 

The Company manufactures on two sites, located in Tewkesbury and Stevenage (following the acquisition of Stevenage Circuits Ltd in April 2020). It serves customers in Europe and North America. The Company has acquired a third site in Stonehouse Gloucestershire initially for its EV programme.

 

Trackwise Designs plc was admitted to trading on AIM in 2018 with the ticker TWD. For additional information please visit www.trackwise.co.uk

 

Financial Review

Revenue for the period increased to £4.3m (H1 2020: £2.4m), which reflects an improving level of revenue generation in 2021 compared to the Covid impacted revenue of 2020 as well as a full contribution from Stevenage Circuits compared to last year. Throughout H1 we have recorded a steady increase in IHT revenues though APCB revenues have been impacted by material supply difficulties.

 

Profitability was held back by supplier constraints and the continuing impact of Covid which impacted across the Group during the Covid lockdown in the early part of the period.

 

During the period we have invested heavily in capacity for the EV OEM product manufacture and supply agreement won last September deliveries for which begin in 2022. Capital expenditure in H1 was £8.7m including £2.7m which relates to deposits on new equipment, which is disclosed in the balance sheet as Other Receivables.   At 30 June 2021 the Company had net cash of £2.6m, gross cash of £4.8m and unused facilities of up to £0.75m. In August a new mortgage finance facility of £1.96m was completed on the Stonehouse freehold site.

 

The outcome of the period is that losses per share were   (2.00)p (H1 2020 earnings per share: 4.98p)  

Board Change

Mark Hodgkins has indicated his intention to step down from the Board at the next AGM. Mark, 64, would like to reduce his full-time work commitment and pursue a portfolio career. The Board has commenced the search for his successor.

 

CEO's Statement

 

I am pleased to report on a period in which Trackwise has ensured it is well positioned to meet further demand for its proprietary technology. We performed well in the first half, seeing an increase in demand across our target markets in our IHT and Advanced PCBs divisions. We have progressed against our strategy through the acquisition of a third manufacturing site. Through the investments into production capabilities, we are significantly better positioned to meet the anticipated uptick in demand expected in our IHT division.

We also invested in a number of new appointments. Steve Hudson as Chief Operating Officer brings over 20 years' experience in the automotive and aerospace industry, having occupied operational and programme leadership roles at Bentley Motors and Rolls Royce Aerospace. As COO, Steve has been responsible for overseeing the day-to-day operational functions of the Company across its three sites and leads on the delivery of the Stonehouse site. In the period we have made a number of senior new hires in advance of production commencing at Stonehouse.

There remains a significant opportunity ahead for Trackwise and the Group is seeing an increasing number of interested parties across its target markets, particularly the automotive and medical devices sectors. While the Group's main focus is on delivering organic growth through the healthy pipeline we see ahead, we remain open to the possibility of acquisition where appropriate.

Improved Harness Technology

Improved Harness Technology (IHT), the long-term growth driver for Trackwise, is the patented technology which enables the manufacture of length-unlimited multi-layer flexible printed circuit boards.

IHT has delivered a strong performance in the first half, as a result of the recovery of trading activity among our end customers in combination with the increase in demand for this technology. During the period, IHT revenues for the first half of 2021 were 95% of those for the whole of 2020 and we expect these revenues to be at record levels at the full year.

In April we completed the acquisition of a 77,000 sq. ft. freehold property in Stonehouse, Gloucestershire, for £2.8 million. This site will house the high-volume, low mix, roll to roll IHT production facility and significantly increases Trackwise's production capacity to meet the expected demand for IHT across its target markets.

The Company remains subject to global supply chain issues until the full completion of machinery installation at Stonehouse, but good progress is being made on the delivery of this site. We expect to be in production in early 2022, in line with the revised ramp-up in production by the Company's EV OEM customer, and we are working increasingly closely with the customer as we progress towards this date.

While IHT has a wide range of applications, we have set out the three markets where we expect to see the greatest levels of growth for this technology. These are:

1.  Electric Vehicles

2.  Medical

3.  Aerospace

We remain confident in the applicability of our proprietary technology to these markets and the significant revenues this has the potential to generate.

 

Electric Vehicles  

 

The Electric Vehicles market is the key area of activity for Trackwise, and interest in IHT from this market continues to be healthy. Following on from the EV OEM manufacturing agreement we signed in September 2020, in July we announced an extension to the agreement from three to four years, with a significant increase in expected volumes and potential value. In line with the Stonehouse site completion expected in January 2022, we expect a ramp up in demand production and revenues from this deal in the same month.

 

In line with the growing emphasis on the sustainability agenda and an increasing legislative pressure to force the automotive sector towards non-fossil fuel motive power, we expect to see further interest from EV customers. During the year-to-date progress has been made with passenger and commercial vehicle OEMs/Tier1s, including the design, manufacture and supply of IHT sample/development parts.

 

 

IHT's application for medical catheters represents a significant opportunity through the provision of long, narrow flex PCBs to replace multiple micro-wires, very small gauge wires that are currently used to connect remote (distal) electronics through the patient and out to the surgeon.

In May we announced a multi-year agreement with the Stockholm-based medical device technology company CathPrint AB. This agreement paves the way for a potential longer-term ramp up in volume. Elsewhere, the Group has made good progress in this market and is working with a number of other active customers in that sector to supply parts for catheter products, and we expect to see larger production orders placed in the not-too-distant future

 

Aerospace forms another of the target markets for Trackwise through the application of IHT to battery management systems. Despite the impact of COVID on the global aviation industry, the Group is working with a number of customers in this space and, as trading conditions and aviation activity normalises, we expect to see further opportunities in this field.

 

Other IHT

The Group continues to attract interest from a number of additional markets in which IHT is applicable. The Group continues to explore these markets and engage with potential customers, and this year it has successfully delivered a project to customer in nuclear fusion, and the Group expects further demand from this customer in due course.

 

Advanced PCBs

The Advanced PCBs division comprises Trackwise's legacy radiofrequency (RF) division and the printed circuit board manufacturer Stevenage Circuits Limited, acquired by Trackwise in 2020.

This division delivered a solid first half, despite the ongoing impact from supply chain issues, with revenues up c. 6% from H2 2020. Our order book remains strong and there will be an additional shift added to accommodate demand seen recently and anticipated in future.

 

Current trading and outlook

The Company is making good progress with its investment into the Stonehouse site, enabling the roll-to-roll production of IHT in the new year in order to service our EV OEM customer and other customers being developed.

Alongside this, IHT acceptance continues to grow, and the Company is on track to deliver record IHT revenues in 2021. Our EV OEM product delivery is due to begin in early 2022, aligned with the opening of our third site at Stonehouse.

While the Company has successfully navigated the supply chain issues around the supply of copper, we are not immune from the ongoing uncertainty in the wider external environment. As a result, while they will naturally ebb and flow, further supply chain issues are likely to continue to affect the Group's end customers and suppliers in the short term.

The Group is well-positioned to manage these pressures and, as a result, management expects to report 2021 trading in line with market expectations. Overall, the long-term prospects for the Company remain as exciting as ever and we remain confident in the Group's strategy and future growth prospects.

 

 

Interim Condensed Consolidated Statement of Comprehensive Income

 

 

 

 

Notes

Unaudited Six months ended 30 June 2021

 

Unaudited Six months ended 30 June 2020

 

Audited

Year ended 31 December 2020

 

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

Revenue

3

4,090

 

2,389

2

6,068

 

 

 

 

 

 

 

Cost of sales

 

(2,904)

 

(1,964)

 

(4,350)

 

 

 

 

 

 

 

Gross profit

 

1,186

 

425

 

1,718

 

 

 

 

 

 

 

Administrative expenses excluding

exceptional costs and share based payment

 

Exceptional and non-recurring costs

 

Share based payment charges

 

 

 

4

 

 

(1,315)

 

(195)

 

(149)

 

 

(790)

 

-

 

(112)

 

 

 

(1,903)

 

(128)

 

(228)

 

 

 

 

 

 

 

Total administrative expenses

 

(1,623)

 

(902)

 

(2,259)

 

 

 

 

 

 

 

Operating loss

 

(473)

 

(477)

 

(541)

 

 

 

 

 

 

 

Negative goodwill arising on acquisition

 

-

 

1,545

 

1,642

Acquisition expenses

 

-

 

(214)

 

(226)

Exceptional integration costs

 

-

 

-

 

(278)

Finance income

 

-

 

-

 

4

Finance costs

 

(138)

 

(66)

 

(195)

 

 

 

 

 

 

 

(Loss)/profit before taxation

 

(611)

 

788

 

406

 

 

 

 

 

 

 

Taxation

5

42

 

133

 

828

 

 

 

 

 

 

 

(Loss)/profit and total comprehensive (expense)/income for the period

 

 

(569)

 

 

921

 

 

1,234

 

 

 

 

 

 

 

 

(Loss)/earnings per share (pence)

 

 

 

 

 

 

Basic

7

(2.00)

 

4.98

 

5.96

Diluted

7

(2.00)

 

4.82

 

5.70

 

 

 

 

 

 

 

 

Interim Condensed Consolidated Statement of Financial Position

 

Notes

Unaudited 30 June 2021

 

Unaudited 30 June 2020

 

Audited

31 December 2020

 

 

£'000

 

£'000

 

£'000

ASSETS

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

Intangible assets

8

7,940

 

5,200

 

6,482

Property, plant and equipment

 

11,425

 

8,363

 

8,175

 

 

19,365

 

13,563

 

14,657

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Inventories

 

2,296

 

1,740

 

2,010

Trade and other receivables

 

5,498

 

1,585

 

1,752

Current tax receivable

 

1,146

 

448

 

804

Cash and cash equivalents

 

4,806

 

3,209

 

13,930

 

 

13,746

 

6,982

 

18,496

 

 

 

 

 

 

 

Total assets

 

33,111

 

20,545

 

33,153

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Trade and other payables

 

(2,501)

 

(2,210)

 

(1,956)

Borrowings

 

(887)

 

(575)

 

(1,055)

 

 

(3,388)

 

(2,785)

 

(3,011)

 

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

 

Deferred income - grants

 

(975)

 

(914)

 

(910)

Borrowings

 

(3,714)

 

(3,640)

 

(4,078)

Deferred tax liabilities

 

(506)

 

(401)

 

(206)

Provisions

 

(79)

 

(310)

 

(79)

 

 

(5,274)

 

(5,265)

 

(5,273)

 

 

 

 

 

 

 

Total liabilities

 

(8,662)

 

(8,050)

 

(8,284)

 

 

 

 

 

 

 

Net assets

 

24,449

 

12,495

 

24,869

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

Share capital

 

1,137

 

885

 

1,137

Share premium account

 

20,989

 

9,374

 

20,989

Retained earnings

 

2,214

 

2,088

 

2,615

Revaluation reserve

 

109

 

148

 

128

Total equity

 

24,449

 

12,495

 

24,869

Interim Condensed Consolidated Statement of Changes in Equity

 

Share

capital

 

Share premium account

 

Retained earnings

 

Revaluation reserve

 

Total equity

 

£'000

 

£'000

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

 

 

 

At 1 January 2020

591

 

4,234

 

1,045

 

167

 

6,037

 

 

 

 

 

 

 

 

 

 

Profit and total comprehensive income for the period

-

 

-

 

921

 

-

 

921

Issue of shares

294

 

5,140

 

-

 

-

 

5,434

Share based payment

-

 

-

 

103

 

-

 

103

Revaluation realised in period

-

 

-

 

19

 

(19)

 

-

At 30 June 2020

885

 

9,374

 

2,088

 

148

 

12,495

 

 

 

 

 

 

 

 

 

 

Profit and total comprehensive income for the period

-

 

-

 

313

 

-

 

313

Issue of shares

252

 

11,615

 

-

 

-

 

11,867

Share based payment

-

 

-

 

160

 

 

 

160

Prior year tax adjustment

-

 

-

 

34

 

-

 

34

Revaluation realised in period

-

 

-

 

20

 

(20)

 

-

At 31 December 2020 and 1 January 2021

1,137

 

20,989

 

2,615

 

128

 

24,869

 

 

 

 

 

 

 

 

 

 

Loss and total comprehensive expense for the period

-

 

-

 

(569)

 

-

 

(569)

Share based payment

-

 

-

 

149

 

-

 

149

Revaluation realised in period

-

 

-

 

19

 

(19)

 

-

At 30 June 2021

1,137

 

20,989

 

2,214

 

109

 

24,449

 

 

 

 

 

 

 

 

 

 

 

Interim Condensed Consolidated Statement of Cash Flows

 

 

 

Unaudited Six months ended 30 June 2021

 

Unaudited Six months ended 30 June 2020

 

Audited

Year ended 31 December 2020

 

 

  £'000

 

£'000

 

£'000

Cash flow from operating activities

 

 

 

 

 

 

(Loss)/profit for the period before taxation

 

(611)

 

788

 

406

Adjustment for:

 

 

 

 

 

 

Employee share based payment charges

 

149

 

112

 

263

263

Depreciation of property, plant and equipment

 

524

 

349

 

693

Amortisation of intangible assets

 

181

 

118

 

265

Negative goodwill credited

 

-

 

(1,545)

 

(1,642)

Finance costs

 

138

 

66

 

191

Changes in working capital:

 

 

 

 

 

 

Increase in inventories

 

(286)

 

(314)

 

(584)

(Increase)/decrease in trade and other receivables

 

 

(732)

 

 

459

 

 

374

(Decrease)/increase in trade and other payables

 

 

(221)

 

 

21

 

 

(362)

Cash (used in)/from operations

 

(858)

 

54

 

(396)

Income tax received

 

-

 

420

 

669

Net cash (used in)/from operating activities

 

 

(858)

 

 

474

 

 

273

 

 

 

 

 

 

 

Cash flow from investing activities

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

(6,266)

 

(359)

 

 

(911)

Purchase of intangible assets

 

(1,478)

 

(1,036)

 

(2,246)

Purchase of subsidiary (net of cash acquired)

 

-

 

(1,629)

 

(1,628)

Grant funding - purchase of intangible assets

 

92

 

-

 

109

Interest received

 

-

 

-

 

4

(4,672)

Net cash used in investing activities

 

(7,652)

 

(3,024)

 

(4,672)

 

Cash flow from financing activities

 

 

 

 

 

 

Share capital issued

 

-

 

5,873

 

18,492

Expenses relating to share capital issue

 

-

 

(439)

 

(1,191)

Interest paid

 

(138)

 

(66)

 

(195)

Lease payments

 

(106)

 

(81)

 

(87)

Advance of hire purchase finance against assets already purchased

 

 

135

 

 

-

 

 

1,139

Repayment of other finance

 

(128)

 

-

 

-

Repayment of capital element of lease contracts

 

 

(377)

 

 

(95)

 

 

(396)

Net cash (used in)/from financing activities

 

 

(614)

 

 

5,192

 

 

17,762

 

 

 

 

 

 

 

(Decrease)/increase in cash and cash equivalents

 

 

(9,124)

 

 

2,642

 

 

13,363

 

 

 

 

 

 

 

Net cash and cash equivalents at beginning of the period

 

 

13,930

 

567

 

 

567

 

 

 

 

 

 

 

Net cash and cash equivalents at end of period (all cash balances)

 

 

4,806

 

3,209

 

 

13,930

 

 

 

 

 

 

 

 

Notes to the Interim Financial Information

 

1.  Corporate information

Trackwise Designs plc is a public company incorporated in the United Kingdom. The registered address of the Company is 1 Ashvale, Alexandra Way, Ashchurch, Tewkesbury, Gloucestershire, GL20 8NB.

The principal activity of the Company and the Group is the development, manufacture and sale of printed circuit boards.

 

2.  Accounting policies

Basis of preparation

This unaudited consolidated interim financial information has been prepared in accordance with IFRS as adopted by the United Kingdom including IAS 34 'Interim Financial Reporting'. The principal accounting policies used in preparing the interim results are those it expects to apply in its financial statements for the year ending 31 December 2021. These are unchanged from those applied in the 31 December 2020 Company financial statements

The financial information does not contain all of the information that is required to be disclosed in a full set of IFRS financial statements. The financial information for the six months ended 30 June 2021 and 30 June 2020 is unreviewed and unaudited and does not constitute the Group or Company's statutory financial statements for those periods.

The comparative financial information for the full year ended 31 December 2020 has, however, been derived from the audited statutory financial statements for that period. A copy of those statutory financial statements has been delivered to the Registrar of Companies. The auditor's report on those accounts was unqualified, did not include references to any matters to which the auditor drew attention by way of emphasis without qualifying its report and did not contain a statement under section 498(2)-(3) of the Companies Act 2006.

The financial information in the Interim Report is presented in Sterling.

3.  Segmental reporting

IFRS 8, Operating Segments, requires operating segments to be identified on the basis of internal reports that are regularly reviewed by the company's chief operating decision maker. The chief operating decision maker is considered to be the Board of Directors.

The operating segments are monitored by the chief operating decision maker and strategic decisions are made on the basis of adjusted segment operating results. From January 2018 the RF and IHT activities began to be separately reviewed and monitored, initially in respect of revenue. Since the acquisition of Stevenage Circuits Limited in April 2020 the Company monitors separately the IHT business and the Advanced PCB business, which comprises the Stevenage Circuits Limited and the RF business of Trackwise Designs plc.

All assets, liabilities and revenues are located in, or derived in, the United Kingdom. The material assets and liabilities relate to overall activity with the exception of the intangible development costs and deferred grants which are solely in respect of IHT.

In the six months ended 30 June 2021 the group had one major customer who represented 11%  of revenue (30 June 2020: two major customers who each represented 12% of total revenue, and full year ended 31 December 2020: 3 customers with similar revenue levels together representing 29% of revenue).

 

 

 

Revenue by product and geographical destination was as follows:

 

 

Unaudited Six months ended 30 June 2021

 

Unaudited Six months ended 30 June 2020

 

Audited

Year ended 31 December 2020

 

  £'000

 

£'000

 

£'000

 

 

 

 

 

 

IHT

581

 

251

 

601

APCB

3,509

 

2,138

 

5,467

 

4,090

 

2,389

 

6,068

 

 

 

 

 

 

UK

3,053

 

1,495

 

3,693

Europe

732

 

751

 

1,688

Other

305

 

143

 

687

 

4,090

 

2,389

2

6,068

 

4.  Exceptional and non-recurring items

Non recurring amounts disclosed in administrative expenses are as follows:

 

 

Unaudited Six months ended 30 June 2021

 

Unaudited Six months ended 30 June 2020

 

Audited

Year ended 31 December 2020

 

  £'000

 

£'000

 

£'000

 

 

 

 

 

 

New production site set up expenditure

141

 

-

 

-

Integration and other costs

54

 

-

 

-

Set up costs for new customer

-

 

-

 

128

 

195

 

-

 

128

 

5.  Income tax

Taxation is provided at the estimated rate of tax for the period, applying the enacted rate of 25% (2020:19%) to deferred tax balances as applicable to the expected reversal dates, and including the benefit of enhanced allowances for research and development costs in tax losses used to record a credit paid to the group.

 

The credits have been impacted by both the change in deferred tax rate following enactment of the Finance Act 2021 and by movements in the period end share price directly affecting deferred tax in respect of future deductions from the exercise of share options. These non-recurring items have been analysed in the elements of the tax credit shown below.

 

 

Unaudited Six months ended 30 June 2021

 

Unaudited Six months ended 30 June 2020

 

Audited

Year ended 31 December 2020

 

  £'000

 

£'000

 

£'000

 

 

 

 

 

 

Development expenditure tax credits

342

 

133

 

633

Deferred tax in respect of share options

(141)

 

-

 

440

Deferred tax change in rate

(121)

 

-

 

53

Deferred tax from other timing differences

 

(38)

 

 

-

 

 

(298)

 

42

 

133

 

828

 

6.  Dividends paid and proposed

No dividends have been paid or proposed in the period ended 30 June 2021 or year ended 31 December 2020.

 

7.  Earnings per share

The calculation of the basic and diluted earnings per share is based on the following data:

 

 

 

 

 

 

 

Unaudited

Six months ended 30 June 2021

 

Unaudited Six months ended 30 June 2020

 

Audited

Year ended 31 December 2020

 

  £'000

 

£'000

 

£'000

(Loss)/earnings for the purpose of basic and diluted earnings per share being net (loss)/profit attributable to the shareholders

(569)

 

921

 

 

1,234

 

 

 

 

 

 

 

Number

 

Number

 

Number

Weighted average number of ordinary shares for the purposes of basic (loss)/earnings per share

28,426,122

 

18,503,836

 

20,687,836

Weighted average number of ordinary shares for the purposes of diluted (loss)/earnings per share

28,426,122

 

19,116,462

 

21,659,166

 

 

 

 

 

 

Options over 901,909 shares were granted to employees on 15 June 2018 and 984,000 on 24 June 2020 which are still exercisable and potentially dilutive shares included in the weighted average for the year ended 31 December 2020.

 

8.  Intangible fixed assets

 

 

 

 

 

Development costs

 

 

 

£'000

 

 

Cost

 

 

 

At 1 January 2020

4,368

 

 

Additions

1,024

 

 

As at 30 June 2020

5,392

 

 

Additions

1,423

 

 

As at 31 December 2020

6,815

 

 

Additions

1,548

 

 

As at 30 June 2021

8,363

 

 

 

 

 

 

Amortisation or impairment

 

 

 

At 1 January 2020

268

 

 

Charge

113

 

 

As at 30 June 2020

381

 

 

Charge

142

 

 

As at 31 December 2020

523

 

 

Charge

175

 

 

As at 30 June 2021

698

 

 

 

 

 

 

Carrying amount

 

 

 

As at 30 June 2020

5,011

 

 

As at 31 December 2020

6,292

 

 

As at 30 June 2021

7,665

 

 

 

 

 

 

The capitalised development project costs relate to the significant continuing investment in respect of the Company's Improved Harness Technology ('IHT') process for unlimited length printed circuit boards and know-how which is being developed by the Company with amortisation on the initial development projects commencing in 2018.

 

The remainder of intangible assets is represented by software assets and an unchanged amount of goodwill in respect of the initial technology.

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