Final Results
29 May 2015
Windar Photonics plc
("Windar", the "Company" or the "Group")
Final Results and Annual Accounts the year ended 31 December 2014
SUMMARY:
* Turnover of €1,038,673 achieved, up from €74,141 in 2013
* Positive sales growth of the WindEyeâ„¢ Sensor in China, EU and USA
* The Company raised €7.5 million in the year from the issue of new shares
* Admission to trading on AIM in March 2015
CHAIRMAN'S STATEMENT
Although these are the first results that the Group has announced since it
became a public company, the period of these results relate to a period before
the Company's shares were admitted to the AIM Market. In the year ended 31
December 2014, the Group incurred a loss before taxation of €2,684,171 (2013 -
€1,451,846), after exceptional costs incurred in respect of the introduction
and listing on AIM of €668,724 (2013 - Nil), on a turnover of €1,038,673 (2013
- €74,141).
The wind energy industry has continued to develop during 2014, requiring
increasingly innovative technological solutions to meet the market's demands
for improved efficiency from already operational wind turbine assets. This
situation presents an excellent opportunity for a group like Windar Photonics,
which can provide an innovative and cost-effective optimisation solution that
will improve the performance and enhance the lifespan of a customer's wind
turbine assets.
Windar Photonics has passed some very significant milestones during the last
year which, as a natural consequence of the development of the Group, prepared
the Group for admission to the AIM Market, which took place on 30 March 2015.
We have also strengthened the Board and, following fundraisings of
approximately £5.9 million (€7.5 million) between August and December 2014,
have provided the necessary funding to support the future growth of the Group.
The recent project with the EUDP (a Danish state funded project for new energy
technology) has now been concluded. However, further funding, amounting to €
1.1 million, has been obtained from the EUDP project for the 2015/2016 years,
to support our technological progress. Additional funding has also been
obtained through the Danish Market Development Fund to allow for the further
development of our Lidar technology and to provide the foundation for more
product demonstration projects.
During the last financial year we have managed to meet our sales targets and
are now well positioned in the current financial year, particularly in the
Chinese market. In order to strengthen our sales force, Windar Photonics has
increased the sales team in Denmark and established local sales representation
in China, Spain, Germany, Brazil, and the US to address the global interest in
Windar Photonics' optimisation solution for the retrofit market, the Group's
primary focus in the near term. Likewise, good progress has been made in
discussions with global wind turbine manufacturers to incorporate the WindEyeâ„¢
Sensor at the design stage of new wind turbines.
During the last year we have made significant technological advances with the
WindEyeâ„¢ Sensor. We have also launched demonstration projects in China, the US,
Canada and Europe, where we have had opportunities to refine the WindEyeâ„¢
Sensor even further by improving some of the mechanical aspects of the system,
resulting in a reduction of the production costs of the WindEyeâ„¢ Sensor system.
Furthermore, the patent relating to our unique use of the semi-conductor laser
has been issued in the US and approved in the EU.
In addition, we have experienced good results regarding the integration of the
WindEyeâ„¢ Sensor system with existing operating wind turbine control systems
using our switchbox, Windswitch, in situations where full integration with the
original OEM software would be over complex.
Windar Photonics has additionally initiated product development projects to
enable measurement of wind shear to expand on the future applicability of the
system, and to ensure we continue to meet the market's demands for optimization
solutions.
Lastly, Windar Photonics has been certified according to ISO 14001, OHSAS 18001
standards and re-certified in accordance with the ISO 9001 standard to ensure
that Windar Photonics adheres to the international standards regarding
environment, quality control, health, and safety.
With the necessary funding in place and a growing global presence, Windar
Photonics is well positioned to meet the challenges of tomorrow and further
consolidate Windar Photonics' position in the market for Lidar-based wind
turbine optimization.
John Weston
Chairman
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2014
Year ended Year ended
31 December 31 December
2014 2013
€ €
Note
Revenue 4 1,038,673 74,141
Cost of Goods Sold (678,150)
(44,270)
Gross profit 360,523 29,871
Administrative expenses (2,201,401) (1,387,984)
Administrative expenses - Costs in respect (668,724) -
of the Introduction and Listing on AIM
Loss from operations
(2,509,602) (1,358,113)
Finance income 84,985 68,704
Finance expenses (259,554) (162,437)
Loss before taxation
(2,684,171) (1,451,846)
Taxation 6 70,312 118,310
Loss for the year
(2,613,859) (1,333,536)
Other comprehensive income
Items that will or maybe reclassified to
profit or loss:
Exchange losses arising on translation of (8,440) (245)
foreign operations
Total comprehensive loss for the year (2,622,299)
(1,333,781)
Loss per share for loss attributable to
the ordinary equity holders of Windar
Photonics plc
Basic, cents per share (0.04)
7 (0.08)
Diluted, cents per share (0.08) (0.04)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2014
31 December 31 December
2014 2013
€ €
Note
Assets
Non-current assets
Intangible assets 1,147,510 1,259,334
Property, plant & equipment 31,989 17,465
Deposits 15,161 10,896
Total non-current assets 1,194,660 1,287,695
Current assets
Inventory 9 248,113 147,024
Trade receivables 10 493,283 45,726
Other receivables 10 193,666
352,092
Prepayments 13,671 5,218
Cash and cash equivalents 11 249,922
5,548,596
Total current assets 641,556
6,655,755
Total assets 7,850,415 1,929,251
Equity
Share capital 487,688 411,245
Share premium -
6,994,646
Merger reserve 2,910,866 1,551,502
Foreign currency reserve (10,892) (2,452)
Accumulated loss (1,789,865)
(4,282,490)
Total equity 6,099,818 170,430
Non-current liabilities
Convertible bonds - debt instrument - 501,552
13
Convertible bonds - embedded derivative - 297,325
13
Growth fund loan 717,064 639,610
13
Total non-current liabilities 717,064 1,438,487
Current liabilities
Trade and other payables 12 913,283 165,548
Other liabilities 120,250 154,786
12
Total current liabilities 1,033,533 320,334
Total liabilities 1,750,597 1,758,821
Total equity and liabilities 7,850,415 1,929,251
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2014
Year ended Year ended
31 December 31 December
2014 2013
Notes € €
Loss for the period before tax (2,684,171) (1,451,846)
Adjustments for:
Finance income (84,985) (68,704)
Finance expenses 259,554 162,437
Amortisation 319,323 307,546
Depreciation 7,882 5,783
Received tax credit 118,480 94,562
Foreign exchange difference (7,643) (245)
Warrants expense 103,107 -
(1,968,453) (950,467)
Movements in working capital
Changes in inventory (101,089) (94,738)
Changes in receivables (666,871) 44,432
Changes in trade payables 247,960 -
Changes in other payables 465,241 (500)
Cash flow from operations (2,023,212) (1,001,273)
Investing activities
Payments for intangible assets (207,733) (54,807)
Payments for tangible assets (22,387) (8,553)
Cash flow from investing activities (230,120) (63,360)
Financing activities
Proceeds from issue of share capital 7,643,977 -
Costs associated with the issue of (572,889) -
share capital
Issue of convertible debt 737,779 806,654
Costs associated with the issue and (183,933) -
conversion of bonds
Non cash effects on the conversion 24,768
of Bonds
Net change in long term borrowing 77,454
Interest received (259,554) -
Interest paid 84,985 (806)
Cash flow from financing activities 7,552,587 805,848
Net increase in cash and cash (258,785)
equivalents 5,299,255
Exchange differences (581) (546)
Cash and cash equivalents at the 249,922 509,253
beginning of the year
Cash and cash equivalents at the end 249,922
of the year 5,548,596
CONSOLIDATED AND COMPANY STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 31
DECEMBER 2014
Share Share Merger Foreign Accumulated Total
Capital Premium reserve currency Losses
reserve
€ € € € € €
At I January 2013 411,245 - 1,551,502 (2,207) (456,329) 1,504,211
Comprehensive loss - - - - (1,333,536) (1,333,536)
for the year
Other comprehensive - - - (245) - (245)
loss
At 31 December 2013 - 1,551,502 (2,452) 170,430
411,245 (1,789,865)
At 1 January 2014 - 1,551,502 (2,452) 170,430
411,245 (1,789,865)
Issue of shares on 3 - - - - 3
incorporation
Effects of bonds - - 1,359,364 - 18,127 1,377,491
conversion in
subsidiary
New shares issued 75,518 7,476,233 - - - 7,551,751
Costs associated with - (572,889) - - - (572,889)
capital raise
New shares issued in 922 91,302 - - - 92,224
respect of services
rendered
Share option and - - - - 103,107 103,107
warrant costs
Comprehensive loss - - - - (2,613,859) (2,613,859)
for the year
Other comprehensive - - - (8,440) - (7,643)
loss
At 31 December 2014 487,688 6,994,646 2,910,866 (10,892) (4,282,490) 6,099,818
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2014
1.General Information
While the financial information included in this preliminary announcement has
been prepared in accordance with International Financial Reporting Standards
(IFRSs), this announcement does not itself contain sufficient information to
comply with IFRSs. The Group has also published full financial statements that
comply with IFRSs available on its website and to be circulated shortly.
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the years ended 31 December 2014 or 2013. The
financial information for the year ended 31 December 2013 is derived from the
statutory accounts for the subsidiary for that year, as the parent company was
not in existence at that date.
The financial information for the year ended 31 December 2014 is derived from
the audited statutory accounts for the year ended 31 December 2014 on which the
auditors have given an unqualified report, that did not contain a statement
under section 498(2) or 498(3) of the Companies Act 2006 and did not include
references to any matters to which the auditors drew attention by way of
emphasis. The statutory accounts will be delivered to the Registrar of
Companies following the Company's annual general meeting.
The accounting policies adopted in the preparation of this preliminary
announcement are consistent with those set out in the latest Group Annual
financial statements. There is no material seasonality associated with the
Group's activities.
2.Going Concern
The consolidated financial statements have been prepared assuming the Group
will continue as a going concern. Under the going concern assumption, an entity
is ordinarily viewed as continuing in business for the foreseeable future with
neither the intention nor the necessity of liquidation, ceasing trading or
seeking protection from creditors pursuant to laws or regulations. In assessing
whether the going concern assumption is appropriate, management has considered
the company's existing working capital and management are of the opinion that
the Group has adequate resources to undertake its planned program of activities
for the 12 months from the date of approval of the consolidated financial
statements.
3.Accounting policies
Basis of preparation
The consolidated financial statements comprises the consolidated financial
information of the Group as at 31 December 2014 and are prepared under the
historic cost convention with the exception of certain items which are measured
at fair value as disclosed in the accounting policies below.
The financial statements has been prepared in accordance with International
Financial Reporting Standards, International Accounting Standards and
Interpretations (collectively "IFRSs") issued by the International Accounting
Standards Board (IASB) as adopted by the European Union ("adopted IFRSs").
The acquisition of the subsidiary was deemed to be a business combination under
common control as the ultimate control before and after the acquisition was the
same. As a result the transaction is outside the scope of IFRS 3 and has been
included under the principles of merger accounting by reference to UK GAAP.
Therefore although the companies that comprise the group did not form a legal
group for the entire period of these financial statements, the current period
and the comparative results comprise the result of the subsidiary as if the
Group had been in existence throughout the entire period.
Windar Photonics A/S adopted IFRS for the first time in the Historical
Financial Information for the three years ended 31 December 2013 as presented
in the Admission Document to AIM dated 24 March 2015. As Windar Photonic plc is
a continuation of the business of Windar Photonics AS as reflected in the
merger accounting principle and therefore the Group is not deemed to be a first
time adopter of IFRS in these financial statements.
Functional and presentational currency
Items included in the Financial Statements are measured using the currency of
the primary economic environment in which each entity operates ("the functional
currency") which is considered by the Directors to be Pounds Sterling (GBP) for
the Parent Company and € for Windar Photonics A/S. The Financial Statements
have been presented in €'s which represent the dominant economic environment in
which the Group operates and is considered to be the functional currency of the
Group.
4.Revenue
Revenue arises from:
Year ended Year ended
31 December 31 December
2014 2013
€ €
Sale of goods 1,038,673 74,141
5.Segment information
Operation segments are reported as reported to the chief operation decision
maker.
The Group has one reportable segment being the sale of LIDAR Wind Measurement.
In 2014, one customer accounted for more than 10 per cent of the revenue. The
total amount of revenue from this customer amounted to 78 per cent of the
revenue (2013: 5 customers who each accounted for more than 10per cent. and in
aggregate totaling 91 per cent of total revenue).
Revenue by geographical location
Year ended Year ended
31 December 31 December
2014 2013
€ €
Europe 48,842 63,148
Americas 126,541 10,993
Asia 863,290 -
Revenue 1,038,673 74,141
6.Income tax
Year ended Year ended
31 December 31 December
2014 2013
€ €
(a) The tax credit for the year:
Corporation tax (70,312) (118,310)
(b) Tax reconciliation
Loss on ordinary activities before tax (2,684,171) (1,451,846)
Loss on ordinary activities at the UK
standard rate of corporation tax 20% (536,834) (290,369)
Effects of:
Expenses non deductible for tax purposes 86,533 128,643
Unutilised tax losses 441,648 161,726
Different tax rates applied in overseas (8,653) -
jurisdictions
Tax credit on research and development (70,312) (118,310)
Tax credit for the year (70,312) (118,310)
The tax credit is recognised as 25 per cent. of the company's deficit that
relates to research and development ("R&D"). Companies in Denmark, who conduct
research and development and accordingly experience deficits can apply to the
Danish tax authorities for a payment equal to 25 per cent. of deficits relating
to R&D up to DKK 25 million.
(c) Factors which may affect future tax charges
In view of the tax losses carried forward there is a deferred tax
amount of approximately €754,198 (2013: € 312,550) which has not been
recognised in these Financial Statements. This contingent asset will
be realised when the Group makes sufficient taxable profits in the
relevant Company.
7.Loss per share
The loss and weighted average number of ordinary shares used in the calculation
of basic loss per share are as follows:
Year ended Year ended
31 December 31 December
2014 2013
€ €
Loss for the year (2,613,859) (1,333,536)
Weighted average number of ordinary shares for
the purpose of basic earnings per share 33,317,654 32,184,002
Basic loss, cents per share (0.08) (0.04)
Diluted loss, cents per share (0.08) (0.04)
There is no dilutive effect of the warrants as the dilution would be negative.
8.Dividends
No dividends were proposed by the Group during the period under review.
9.Inventory
Group
As at As at
31 December 31 December
2014 2013
€ €
Raw material 10,992 -
Goods in progress 93,578 134,934
Finished goods 143,543 12,090
Inventory 248,113 147,024
10.Trade and other receivables
As at As at
31 December 31 December
2014 2013
€ €
Trade receivables 493,283 45,726
Less: provision for impairment of trade - -
receivables
Trade receivables - net 493,283 45,726
Tax receivables 70,407 118,480
Intragroup receivables - -
Other receivables 281,685 75,186
Total other receivables 352,092 193,666
Total trade and other receivables 845,375 239,392
Classified as follows:
Current Portion 845,375 239,392
There is no material difference between the net book value and the fair values
of trade and other receivables due to their short term nature.
As of 31 December 2014, no trade receivables were past due but not impaired,
nor were any past due and impaired.
Other classes of financial assets included within trade and other receivables
do not contain impaired assets.
11.Cash and cash equivalents
For the purpose of the cash flow statement, cash and cash equivalents comprise
the following balances with original maturity less than 90 days:
As at As at
31 December 31 December
2014 2013
€ €
Cash at bank 5,548,596 249,922
Cash and cash equivalents 5,548,596 249,922
12.Trade and other payables
As at As at
31 December 31 December
2014 2013
€ €
Trade payables 913,283 165,548
Other payables 120,250 154,786
Total financial liabilities classified as 1,033,533 320,334
financial liabilities measured at amortised cost
Classified as follows:
Current Portion 1,033,533 320,334
There is no material difference between the net book value and the fair values
of current trade and other payables due to their short term nature.
Maturity analysis of the financial liabilities, classified as financial
liabilities measured at amortised cost, is as follows (the amounts shown are
undiscounted and represent the contractual cash-flows):
As at As at
31 December 31 December
2014 2013
€ €
Up to 3 months 1,033,598 320,334
13.Borrowings
The carrying value and fair value of the Group's borrowings are as follows:
As at As at
31 December 31 December
2014 2013
€ €
Growth Fund 717,064 639,610
Convertible bonds - debt instrument - 501,552
Convertible bonds - embedded derivative - 297,325
Total financial assets other than cash and cash 717,064 1,438,487
equivalents classified as loans and receivables
The Growth Fund borrowing from the Danish public institution, Vækstfonden,
bears interest at a rate of 12 per cent. The borrowing is a bullet loan with
maturity in June 2020. The Group may at any point in time either repay the loan
in part or in full or initiate an annuity repayment scheme over four years. If
an annuity repayment scheme is initiated, the interest rate will be reduced to
8 per cent in the repayment period.
The convertible bonds were issued in June 2013 (nominal € 0.8 million) and in
March 2014 (nominal € 0.7 million). The bonds included an option for the
bondholders to convert the bonds into shares in Windar Photonics A/S at a
discounted share price by either 30 per cent or 50 per cent if, and only if,
the company issued shares to non-existing shareholders. This happened on 30
June 2014, and all bonds were converted into shares in Windar Photonics A/S at
a discount of 30 per cent.
14. Availability of Annual Report and Accounts and Notice of AGM
Copies of the full set of Report and Accounts will be posted to shareholders
today and are available for download on the Group's website http://
investor.windarphotonics.com.
The Report and Accounts contain a notice of the Company's AGM which is to be
held at the offices of Sanlam Securities UK, 10 King William Street, London,
EC4N 7TW at 10.30am on 26 June 2015.
For further information:
Windar Photonics plc Martin Rambusch, CEO +45 2168 9476
Jørgen Korsgaard Jensen, COO
Sanlam Securities UK David Worlidge +44 (0)20 7628 2200
Limited Andrew Wagstaff
(Nomad and Broker)
http://investor.windarphotonics.com
Friday, 17th May 2024
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