FireAngel Safety Technology Group plc
(‘FireAngel’, the ‘ Group’ or the ‘Company’)
FireAngel (AIM: FA.), a leading developer and supplier of home safety products, announces a trading update for the year ended 31 December 2021 (the “Year” or “FY21”). The figures set out in this announcement are subject to audit.
Further to its announcement released on 20 December 2021, the Company confirms that sales for the Year are expected to show an improvement over 2020 of more than 7 per cent. to £42.8 million (2020: £39.9 million). Underlying Loss Before Tax (“LBT”) improved significantly to an adjusted LBT of £3.8 million (2020: adjusted LBT £5.7 million), in line with market expectations, with a marked improvement in adjusted Loss Before Interest Tax Depreciation and Amortisation (“LBITDA”) to £0.3 million (2020: LBITDA £1.2 million). The adjusted gross margin for the Year improved strongly to 23.1% (2020: 19.8%). Stock at 31 December 2021 stood at approximately £3.7 million (2020: £6.6 million).
In H1 2021, the Group raised £9.8 million by way of a placing and open offer to support its strategic priorities following the disruption caused in 2020 by COVID-19. While progress was made in each of Revenue, Gross Margin and Operating Profit in FY21, each of these was suppressed by the global supply chain crisis experienced throughout the Year and particularly in H2. The crisis impacted production due to component shortages, creating shipping and fulfilment delays and driving inflation. An easing of the situation is already evident in early 2022.
Net cash before lease obligations was £0.1 million at 31 December 2021 (2020: net debt £3.7 million) and comprised cash balances of £3.3 million and a CBILS loan of £3.2 million. The loan has a term of 6 years from March 2021 with the first year being free of capital repayments and payments thereafter made monthly over the remainder of the term. The Company has an invoice discounting facility which at the year-end was undrawn.
In H2 2021, the Company was focused on reviewing its supply chain strategy considering the challenges posed to timely supply and input costs by the well documented global issues. Component availability is now planned out into 2023 and the Company has locked in most long-distance shipping rates and timings for 2022 to deliver greater certainty. A full review of the Company’s pricing, competition and channel structure was conducted in H2 2021 and the full impact of the consequent and marked price rises is expected to benefit the Company from early Q2 2022.
As part of its strategy to boost margins further, the Company will launch several entry level products beginning in late Q1 2022. This is expected to be margin enhancing in 2022. This initiative was commenced in 2020, is on time and within budget for delivery. This newer product set is, to date, unaffected by component issues.
During December 2021, the Company successfully completed the fully funded Research Phase 1 of its agreement with Techem Energy Services GmbH (“Techem”), one of the leading service providers for green and smart buildings. Techem’s focus is on energy efficiency along the entire real estate value chain.
Phase 2, the actual development of a new generation smoke alarm with additional functions and sensors, has begun. Techem is funding a co-operative project with FireAngel to develop the alarm over a period expected to last until late 2024. Detailed commercial discussions are underway, including the selection of potential manufacturing partners, and are expected to be concluded shortly.
John Conoley, Executive Chairman of FireAngel, commented:
“The Board is satisfied with the Company’s performance in what was a particularly tough year. Whilst the business faced external challenges, particularly around global supply chain issues, we continued to make strong progress against our strategic priorities. Particularly pleasing is the continued improvement in gross margin, driven mainly by management action and focus. Of longer-term value and huge significance, is the relationship with Techem. This relationship has progressed well and is expected to continue to do so.
“While we are already seeing an easing of supply chain challenges, there may still be some issues during this year, especially in Q1 2022. The Board will continue to monitor these developments closely. From Q2 2022, the Company’s existing strategy, combined with new pricing and supply chain measures, will offer strong validation of the margin improvement opportunity.
“Our proposition to protect and save lives with innovative, cutting-edge home safety technology remains compelling, while our strategic ambition to achieve this through margin improvement and a focus on investing in Connected Homes technology is unchanged. We look forward to making further progress against our priorities in FY 2022.”
The Company expects to announce its audited final results for the year ended 31 December 2021 in late March 2022.
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)||0207 496 3000|
|Rick Thompson/Alex Bond|
|Houston (Financial PR)||0204 529 0549|
|Kate Hoare/Laura Stewart|
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