30 November 2022
Zenova Group PLC
("Zenova", the "Company" or the "Group")
Launch of FX500 and Year End Trading Update
· Zenova announces the launch of the Zenova FX500, a fire extinguisher that is effective for use on any type of fire
· Sale of first units of Zenova FX500 for the use by the military in Ukraine
· Zenova products have now been specified for several regulated UK projects which is a key indicator of the Company's superiority and quality
Zenova Group PLC (AIM: ZED) , specialists in fire safety and heat management technology solutions, is pleased to announce that the Zenova FX500 fire extinguisher will be launching in December.
An initial preorder has been received from a distributor in Ukraine, following their own internal testing of the Zenova FX500 over the past few months; this order will be used by the Ukrainian military and will be deployed by the end of the year in Ukraine where it is expected that more orders will be made as the Zenova production ramps up to meet demand.
Given that the Zenova FX500 is ideal for use in multiple global sectors and due to the significant amount of interest it has gathered, production has commenced in both the UK and the USA. Enquiries from the UK and USA in recent weeks have presented encouraging signs for further orders and sub distribution opportunities from a wide range of sectors now that the Company is in a position to manufacture in key regions.
The Zenova FX500 is a high-performance handheld fire extinguisher that is tested by independent experts and adheres to the highest industry standards. The fire extinguisher is safe to use on any type of fire, reduces the risk of reignition once the fire has been extinguished and has been tested to the BS 6165 standard. It boasts an efficient and compact design, allowing for it to be dispersed from any 360° orientation, which ensures that the Zenova FX500 is convenient to handle and simple to operate while providing the user with a highly effective and fast working fire extinguisher.
The Company believes that Zenova products remain best in class and outperform competitor products and as such, the Board's primary job at this time is one of continued market penetration. This is developing well as a result of the solid base the programme of R&D, certification and testing has provided. Despite a global pandemic and war in Europe, resulting in global resource and shipping delay issues affecting many sectors, the Company is making good progress across its product range, including those still in development.
As announced in previous months Zenova products have now been specified for a number of projects throughout the UK, including social housing. This is a significant achievement in a short period of time as, once specified, the rate of growth of sales and brand recognition should only increase. The board believes that to become specified by architects, Local Authorities, specialist consultants is a key indicator of the superiority and quality the Zenova products bring to the market.
Successful trials and pilots have allowed the Company to penetrate many key sectors, which the board has targeted within its sales plan. The Company has achieved a number of sales that should act as launch pad to future significant revenues in these key sectors.
The key sectors currently being targeted by the Company's sales and marketing team are as follow:
· Social Housing
· Local Authorities
· Film & TV
· Fire services
· Modular ECO Buildings
The Company has secured some cornerstone agreements or in some cases made sales within these key sectors which are expected to develop into large, longer-term sales from these partnerships.
· Beyond Surface Solutions is a specialist within the Marine and Automobile sectors with stock now purchased and in place for Zenova FP, IP, IR and Primer. A number of key trials are now underway with potential customers from the motor industry for both Zenova FP and Zenova IP products to assist with fire protection and insulation respectively.
· SIG Plc is an experienced specialist within the construction sector and one of the largest in the UK with a turnover of £2.2 billion and a significant presence in Europe. SIG has also now placed its first order for Zenova FP, IP, IR and Primer with assisted Zenova product training underway with 24 branches
· Robert Price, a builders merchants with 29 branches in South Wales, has placed an order for Zenova products comprising FP, IP, IR and Primer. Robert Price specialises in supplying innovation to the construction industry and in particular offers key assistance in submitting Zenova products for green and safety grant-funded schemes initiated by the Welsh Assembly.
· Bells & Two Tones and Fire Service Group UK are specialist fire service advisers within the Film and TV sector. Orders have now been placed for Zenova FP and Zenova WB and the products have been utilised on film sets with exceptional results and very positive feedback from the film sets' producers and special effect teams. This customer continues to order products from the Company and has indicated that it will order significantly more product in the coming months as a result of the feedback from the film producers themselves.
Zenova has entered into a number of international sub-distributor agreements in various territories globally including Australia, Spain, Germany, Austria and Switzerland as well as Saudi Arabia and the USA. These contracts include a n annual commitment to purchase a minimum quantity by value of Zenova products , as previously announced . This has grown more slowly than expected and resulted in a low level of orders being placed to date. The Company expects that this will increase in pace as the penetration of markets takes place over time and anticipates that this international network will deliver the revenues committed to as anticipated , albeit at a slower pace until external market conditions improve .
The Company continues to identify and appoint international sub-distributors:
· Ethmaar Investment Company has been approved as a sub-distributor in Saudi Arabia for Zenova FP, IP, IR and Primer. Ethmaar is completing the certification process required by the government in Saudi Arabia, following which a first order is expected to be placed by the end of the year.
· Omnis Panels LLC has been appointed as a sub-distributor within the construction sector in the USA for Zenova FP, IP, IR and Primer. Omnis has begun the task of building brand awareness in the USA with a number of trade show events completed, generating significant interest.
The Board believes that Zenova is now positioned for a period of positive turnover growth as the Company benefits from the hard-work and achievements during the period. The board believes that sales during the current year have been impacted as sales cycles for new innovative safety critical products have lengthened as a result of the broader trading environment. The board therefore expects revenues it previously anticipated to be recorded in 2022 to be pushed into the following financial year. Turnover for the period ended 30 November 2022 will therefore be below that previously anticipated.
The Company is committed to a programme of rigorous cost management and is currently managing its budgets on a monthly basis at Board level. This is coupled with a lower than budgeted manufacturing cost due to its outsourced just in time manufacturing arrangements giving it flexibility, speed and scalability which assists cashflow management. Loss for the year is broadly in line with the board's expectation.
Zenova's cash balance at the end of October was £875,000 which the board believes is sufficient to meet Zenova's current working capital requirements.
Tony Crawley, Chief Executive of Zenova Group PLC said: "The Company continues to make encouraging progress during 2022 and whilst revenue generation has been lower than expected to date, we are confident that the demand for Zenova products will continue to grow, with revenues increasing accordingly.
The launch and first sale of the FX500 extinguisher is another significant milestone for Zenova and will add a further quality product to our fire safety range, benefiting our current sub-distributors and clients globally. The Zenova team has conducted thorough testing and demos to perfect a quality high performance product that extinguishes any type of fire.
Zenova is very proud to be supplying its product for use by the military in Ukraine, with confirmation that the FX500is highly effective in its application in extinguishing all fires.
Zenova Group PLC
Tony Crawley, Chief Executive Officer Don Nicolson, Executive Chairman
Via Orana Corporate LLP: Anthony Eastman
Tel: +44 20 3475 6834
SPARK Advisory Partners Limited (Nominated Adviser)
Matt Davis / Adam Dawes
Tel: +44 20 3368 3550
SI Capital Limited (Broker)
Tel: +44 1483 413 500
About Zenova Group PLC:
The Group, through Zenova Ltd, is the holder of intellectual property that underpins a suite of fire safety and temperature management products and technology. The product range is applicable to industrial, commercial, and residential markets. The Group's products include fire retardant paints, insulating paints and render, fire extinguishing fluid and applications. Through innovative development, and a refined formulation and development process, Zenova provides industry leading solutions across a range of fire protection and temperature management problems, comprising:
A water-based fire-protection paint that prevents ignition and spread of fire. It can be used in commercial, industrial, and domestic applications on variety of materials, from wood to metal.
Patent pending fire extinguisher filled with proprietary Zenova Fluid (Zenova FXB) that extinguishes all types of fires, reduces chances of re-ignition, works in cold (-15 ̊C) conditions, is non-toxic and does not produce harmful by-products.
Thermal insulation paint that creates a thermal barrier, provides thermal reflection of sunrays and infrared radiation, anti-condensation, and anti-mould properties. It can be applied to virtually any exterior or interior material, regardless of the surface.
Thermal insulation render to enhance the effectiveness of insulation by creating a thermo shield. It fills all cavities and gaps regardless of geometric shape and creates a vacuum - the most effective insulator.
A wildfire barrier fluid (applied via spray wands or aerial drops), which provides a virtual barrier where fire simply will not burn. Repeated tests on a variety of extremely dry wildfire fuels (grasses, hays, brush) demonstrates the incredible fire resistance Zenova WB provides, while remaining viable after application for 30+ days in dry conditions.
The Group has achieved this without compromising the sustainability of natural and economical resources, including personal health and safety, with ecologically sound products.
Further information on the Group can be found at www.zenovagroup.com