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Checkit PLC (CKT)

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Thursday 13 February, 2020

Checkit PLC

Trading Update

RNS Number : 8310C
Checkit PLC
13 February 2020
 

Checkit plc

(the "Group")

Trading Update

 

Checkit plc is pleased to provide a trading update for its financial year ending 31 January 2020 ("FY20"). The Group's performance for the full year was in line with management expectations.

A summary of its unaudited sales and cash is as follows:

 

£'m

FY2019 actual

FY2019 normalised*

FY2020

actual

FY2020 normalised*

%

change actual

%

change

normalised*

Sales

 

 

 

 

 

 

Checkit Europe

1.0

1.0

1.3

1.3

30%

30%

Checkit UK

-

10.8

8.5

11.6

-

7%

Checkit total

1.0

11.8

9.8

12.8

870%

8%

EET

2.6

2.6

2.0

2.0

-23%

-23%

Total sales

3.6

14.4

11.8

14.8

228%

3%

 

 

 

 

 

 

 

Cash

10.1

-     

14.3

-

42.5%

-

 

*Normalised sales illustrate sales that would have been included in the Group's financial results had Checkit UK Limited ("CUK"), which was acquired on 14 May 2019, been owned by the Group throughout both periods.

 

Checkit sales were above market expectations, particularly in the area of Checkit UK's installation work, which historically has operated at low margins. Checkit Europe and Checkit UK are in the process of being merged. Consequently, the board does not intend to report separately for future accounting periods.

The board continues to be excited by the medium-term prospects of the Checkit businesses. Several opportunities to improve profitability have been identified and are being implemented in the merged businesses.

Elektron Eye Technology ("EET") experienced a slowdown in sales in the second half of FY20. As previously announced, the board continues to seek a buyer for this non-core business. In view of the limited interest received to date, the board has reduced its expectations regarding potential disposal proceeds.

The cash balance at 31 January 2020 was higher than expected due to repayment of amounts owed (£2.6m) by the Elektron Technology 2012 Employment Benefit Trust following its participation in the recent tender offer. This was partially offset by a working capital adjustment resulting in a return of cash (£0.8m) to the acquirers of the Bulgin business.

The board is currently reviewing its amortisation policy in respect of acquired intangibles and capitalised development costs (in consultation with its auditors) with a view to shortening amortisation periods. This work will be completed by the time of the preliminary announcement scheduled for 14 May 2020.

Keith Daley, Executive Chair said: "This was a good performance during a period of major corporate change as a result of the disposal of the Bulgin business. We are pleased with the performance of Checkit UK, our recent acquisition, and the integration plan we have put in place is on track. The opportunities for the combined group remain attractive and we are optimistic about future growth."

 

 

Checkit plc                                 

+44 (0) 1223 371 000

www.checkit.net


Keith Daley (Executive Chairman)


Andrew Weatherstone (Chief Financial Officer and Company Secretary)


N+1 Singer (Nominated Adviser and Broker)

+44 (0)207 496 3000

Shaun Dobson / George Tzimas (Corporate Finance)


Rachel Hayes (Corporate Broking)


Yellowstone Advisory (Investor Relations)


Alex Schlich


 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
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