FireAngel Safety Technology Group plc
(‘FireAngel’, the ‘Group’ or the ‘Company’)
FireAngel (AIM: FA.), one of Europe’s leading developers and suppliers of home safety products, provides the following trading update for the six months ended 30 June 2021 (‘H1 2021’ or ‘the period’).
The Board of FireAngel is pleased with the progress made in H1 2021, with the Company reporting improved performance and sales growth in-line with the Board’s expectations. Sales are expected to be materially ahead of the prior year period at approximately £22.3 million (H1 2020: £16.5 million) with a materially reduced operating loss* of approximately £1.3 million (H1 2020: loss of £2.7 million). The Board sees this as a strong recovery from last year with a return to a positive EBITDA* of £0.3 million in the period (H1 2020: LBITDA £0.8 million). While COVID-19 restrictions combined with ongoing challenges in global supply chains reduced the ability to exploit fully the growing demand for FireAngel’s connected products, the Board is pleased to have remained on track.
The Group has continued to deliver against its strategy to expand gross margins, which increased to approximately 24% in H1 2021 (H1 2020: 22.2%, H1 2019: 19%). This was driven by a higher sales mix of the Company’s connected products and planned operational improvements which attract wider margins.
At 30 June 2021, following the Company’s successful equity fundraising announced on 30 April 2021, the Group had £5.8 million of cash and £3.6 million of debt (excluding IFRS16 lease liabilities).
Connected homes update
Further to its announcement on 7 April 2021 of a significant partnership with a German energy and efficiency service provider to develop a new generation alarm mainly for the German market, FireAngel has successfully scaled up its activities to meet this opportunity, with the first phase currently on track to complete in Q3 2021 as planned. Billing commenced in Q2.
The Company’s partnership with Ealing Council is now building momentum due principally to the relaxation of COVID-19 restrictions and approximately 4,000 devices have now been installed. The rollout of hardware and connectivity will continue during the remainder of this year and the council is finalising a plan to accelerate the rollout in this quarter to those properties previously delayed due to earlier COVID-19 restrictions. The project, and other smaller scale implementations, will also provide FireAngel with useful case studies which demonstrate the improved safety and cost-savings as a result of using its technology.
Consumer interest and uptake in FireAngel’s connected products has continued to grow, with over 16,000 thousand devices now registered on its consumer mobile phone application, a marked increase from 1,400 devices at 1 July 2020.
Value chain update
The Group’s strategy to improve its value chain continued to progress in the period, with some operational enhancements already delivering value. There is also a project underway to source entry level products, uneconomic to design and produce in Europe, from an existing Chinese partner, which has progressed to certification stage and the Board expects this project to be margin enhancing in 2022.
Deployment of proceeds from April equity raise
The net proceeds of the fundraising announced in April 2021 have been used to strengthen the balance sheet whilst the Group continues its commitment to focus on product development. Utilisation of the warranty provision is tracking to forecasted levels. Although global supply chain challenges have frustrated the planned Q2 2021 increase in inventory, we now expect to build inventory across H2 2021 to meet expected growth.
John Conoley, Executive Chairman of FireAngel, commented: “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. We are working on a range of mitigations to protect ourselves as much as possible against similar potential supply chain challenges going forward.
“The Board is satisfied that the execution of the many elements within the Company’s own control have gone to plan and are beginning to benefit FireAngel’s financial performance. It is promising to see that market demand, especially for our connected products, remains strong and is growing.”
The Board will provide a further update on trading and prospects in its unaudited interim results for the period which are expected to be released in late September 2021.
*Operating loss and EBITDA in H1 2021 are stated before unaudited share based payment charge £0.1 million (H1 2020: £0.2 million)
For further information, please contact:
FireAngel Safety Technology Group plc
024 7771 7700
John Conoley, Executive Chairman
Zoe Fox, Chief Finance Officer
Shore Capital (Nominated adviser and joint broker)
020 7408 4050
Tom Griffiths/David Coaten
Singer Capital Markets (Joint broker)
Houston (Financial PR)
0207 496 3000
0204 529 0549
Notes to Editors
About FireAngel Safety Technology Group plc
FireAngel’s mission is to protect and save lives by making innovative, leading-edge home safety products which are simple and accessible. FireAngel is one of the market leaders in the European home safety products market.
FireAngel’s principal products are connected smoke alarms, CO alarms, heat alarms and accessories. The Company has an extensive portfolio of patented intellectual property in Europe, the US and other selected territories. Products are sold under FireAngel’s leading brands of FireAngel, FireAngel Pro, FireAngel Specification and AngelEye.
For further product information, please visit: www.fireangeltech.com