SANDAL PLC ("SANDAL" or "THE COMPANY")
FINAL RESULTS FOR THE YEAR ENDED 31 MAY 2017
The Board of Sandal Plc, the designer, developer and manufacturer of electronic products announces its full year results for the year to 31 May 2017.
Highlights:
- Turnover increased by 13.7% to £3.75m (2016: £3.3m) and the Company returned to profitability
- Energenie MiHome range expanded and sales increased by 154%
- Higher than expected revenues at Power Connections
- Energenie MiHome Gateway hubs increased by over 350% with number of devices attached to the hub grew by over 475%
- Products stocked by a number of the major retailers in the UK and is also integrated with the major players in the home automation market
Commenting, Sandal's CEO Alan Tadd said: "We will continue to expand the Energenie MiHome range and to grow in the fast-expanding smart homes market through existing customers and through new strategic partnerships whilst exploring the opportunity to expand into Europe using our existing distribution partner, Exertis. We look forward to being able to report on further progress during the year."
Enquiries:
Sandal Plc 01279 422022
Alan Tadd, CEO
Oliver Tadd, Director
www.sandal-plc.co.uk
Cairn Financial Advisers LLP
David Coffman/Jo Turner 020 7213 0880
MB Communications
Maxine Barnes 07860 489571
Fair Review of the business
The year under review saw a number of significant achievements:
Energenie MiHome product range expanded and sales increased by 154%
Energenie MiHome Radiator Valve production successfully moved from UK to China resulting in material cost reductions
Contract signed with Momit for the development and production of a smart room thermostat
Turnover increased by 13.7% in the year mainly as a result of the sales increase of Energenie MiHome products but also due to higher than expected revenue by the PowerConnections division. The Energenie MiHome range achieved its first listings and promotions with High Street retail at Argos, Bunnings (formerly Homebase) and Sainsbury where an initial six week promotion sold out within two weeks. The Company maintained its investment in marketing of Energenie MiHome, increasing attendance at exhibitions but switching focus from consumer shows to installer/wholesaler trade shows supporting the strategy outlined in 2016.
During the year there has been an over 350% increase in the number of Energenie MiHome Gateway Hubs in the market whilst the number of devices attached to these Gateway Hubs has grown by nearly 475%. This demonstrates that consumers are adding devices to their Hub after their initial purchase and reinforces the strategy of selling entry level bundles as an initial route to market. The Directors are confident that there is significant sales potential from both new and existing customers.
The Company has returned to profit for the year with £7,838 (2016 loss £81,494) This included £218,408 (2016 £242,972) of general marketing activities plus non capitalised development costs of £15,585 (2016 £26,600).
Development expenditure continued during the year focusing on new products, technology and integrations with the major platforms. We also have used our application programming interfaces ("APIs") to provide data streaming capability which will enable the Company to derive a recurring income stream from B2B customers.
Since the year end the Company has announced successful integrations with Google Home, Control 4 and are a launch partner with the new Amazon V3 API.
Future Developments
The Directors will continue to expand Energenie MiHome within the resources internally generated and those obtained through capital markets, where necessary. Product development focus will be on selected new products to broaden the Energenie MiHome range and the introduction of two way communications on switches and sockets.
Strategy
The Company's strategy is to continue to grow Energenie MiHome into what is an expanding smart home space. This will be with new and existing products both into the UK whilst also looking to expand into Europe using the distribution network of Exertis, Energenie MiHome's distribution partner. The Company will also pursue other strategic partnerships in addition to those already in trial stage with Howz /EDF and Samsung.
Principle Risks and Uncertainties
Risks
Competitive Risks
The Company operates in a competitive market with changing technologies. We are always reviewing our product and technology offering in our development programme. The Integration with major systems providers is seen as a counter balance to this risk.
Exchange Rate Risks
The Company seeks to internal hedge this risk by buying and selling in US Dollars wherever possible.
Profit and Loss Account
For the year ended 31 May 2017
| 2017 | 2016 | |||||||||||||||||
| £ | £ | |||||||||||||||||
| Turnover | 3,745,780 | 3,295,766 | ||||||||||||||||
| Cost of sales | (2,360,757) | (2,155,047) | ||||||||||||||||
| Gross profit | 1,385,023 | 1,140,719 | ||||||||||||||||
| Administrative expenses | (1,493,715) | (1,367,882) | ||||||||||||||||
| Other operating income | - | 2,184 | ||||||||||||||||
| Operating loss | (108,692) | (224,979) | ||||||||||||||||
| Interest receivable and similar income | 133 | 164 | ||||||||||||||||
| Interest payable and similar expenses | (26,662) | (42,724) | ||||||||||||||||
| Loss before taxation | (135,221) | (267,539) | ||||||||||||||||
| Tax on loss | 143,059 | 185,645 | ||||||||||||||||
| Profit/(loss) for the financial year | 7,838 | (81,894) | ||||||||||||||||
| The Profit And Loss Account has been prepared on the basis that all operations are continuing operations. | ||||||||||||||||||
Statement of Comprehensive Income | ||||||||||||||||||
| For the year ended 31 May 2017 | ||||||||||||||||||
| 2017 | 2016 | |||||||||||||||||
| £ | £ | |||||||||||||||||
| Profit/(loss) for the year | 7,838 | (81,894) | ||||||||||||||||
| Other comprehensive income | ||||||||||||||||||
| Currency translation differences | - | 12,072 | ||||||||||||||||
| Total comprehensive income for the year | 7,838 | (69,822) | ||||||||||||||||
| Balance Sheet | ||||||||||||||
| As at 31 May 2017 | ||||||||||||||
| 2017 | 2016 | |||||||||||||
| £ | £ | £ | £ | |||||||||||
| Fixed assets | ||||||||||||||
| Goodwill | 10,500 | 16,250 | ||||||||||||
| Other intangible assets | 194,593 | 83,682 | ||||||||||||
| Total intangible assets | 205,093 | 99,932 | ||||||||||||
| Tangible assets | 195,406 | 215,189 | ||||||||||||
| Investments | 101 | 101 | ||||||||||||
| 400,600 | 315,222 | |||||||||||||
| Current assets | ||||||||||||||
| Stocks | 915,367 | 736,031 | ||||||||||||
| Debtors - deferred tax | 23,357 | 65,927 | ||||||||||||
| Debtors - other | 932,148 | 808,391 | ||||||||||||
| Cash at bank and in hand | 162,442 | 343,203 | ||||||||||||
| 2,033,314 | 1,953,552 | |||||||||||||
| Creditors: amounts falling due within one year | (1,272,716) | (1,067,764) | ||||||||||||
| Net current assets | 760,598 | 885,788 | ||||||||||||
| Total assets less current liabilities | 1,161,198 | 1,201,010 | ||||||||||||
| Creditors: amounts falling due after more than one year | (139,566) | (230,445) | ||||||||||||
| Provisions for liabilities | (27,246) | (30,257) | ||||||||||||
| Net assets | 994,386 | 940,308 | ||||||||||||
| Capital and reserves | ||||||||||||||
| Called up share capital | 329,978 | 324,660 | ||||||||||||
| Share premium account | 162,860 | 121,938 | ||||||||||||
| Profit and loss reserves | 501,548 | 493,710 | ||||||||||||
| Total equity | 994,386 | 940,308 | ||||||||||||
| The financial statements were approved by the board of directors and authorised for issue on 4 October 2017 and are signed on its behalf by: | ||||||||||||||
| Mr A J Tadd | ||||||||||||||
| Director | ||||||||||||||
| Statement of Changes in Equity | ||||||||||||||
| For the year ended 31 May 2017 | ||||||||||||||
| Share capital | Share premium account | Profit and loss reserves | Total | |||||||||||
| £ | £ | £ | £ | |||||||||||
| Balance at 1 June 2015 | 323,470 | 111,826 | 563,532 | 998,828 | ||||||||||
| Year ended 31 May 2016: | ||||||||||||||
| Loss for the year | - | - | (81,894) | (81,894) | ||||||||||
| Other comprehensive income: | ||||||||||||||
| Currency translation differences | - | - | 12,072 | 12,072 | ||||||||||
| Total comprehensive income for the year | - | - | (69,822) | (69,822) | ||||||||||
| Issue of share capital | 1,190 | 10,112 | - | 11,302 | ||||||||||
| Balance at 31 May 2016 | 324,660 | 121,938 | 493,710 | 940,308 | ||||||||||
| Year ended 31 May 2017: | ||||||||||||||
| Profit and total comprehensive income for the year | - | - | 7,838 | 7,838 | ||||||||||
| Issue of share capital | 5,318 | 40,922 | - | 46,240 | ||||||||||
| Balance at 31 May 2017 | 329,978 | 162,860 | 501,548 | 994,386 | ||||||||||
| Statement of Cash Flows | |||||||||||||||||||
| For the year ended 31 May 2017 | |||||||||||||||||||
| 2017 | 2016 | ||||||||||||||||||
| £ | £ | £ | £ | ||||||||||||||||
| Cash flows from operating activities | |||||||||||||||||||
| Cash absorbed by operations | (192,657) | (18,100) | |||||||||||||||||
| Interest paid | (26,662) | (42,724) | |||||||||||||||||
| Income taxes refunded | 178,719 | 37,386 | |||||||||||||||||
| Net cash outflow from operating activities | (40,600) | (23,438) | |||||||||||||||||
| Investing activities | |||||||||||||||||||
| Purchase of intangible assets | (128,630) | (104,593) | |||||||||||||||||
| Purchase of tangible fixed assets | (49,669) | (37,323) | |||||||||||||||||
| Proceeds from other investments and loans | 1,012 | (1,209) | |||||||||||||||||
| Interest received | 133 | 164 | |||||||||||||||||
| Net cash used in investing activities | (177,154) | (142,961) | |||||||||||||||||
| Financing activities | |||||||||||||||||||
| Proceeds from issue of shares | 46,241 | 11,302 | |||||||||||||||||
| Repayment of bank loans | (76,949) | 170,538 | |||||||||||||||||
| Payment of finance leases obligations | (19,881) | (19,773) | |||||||||||||||||
| Net cash (used in)/generated from financing activities | (50,589) | 162,067 | |||||||||||||||||
| Net decrease in cash and cash equivalents | (268,343) | (4,332) | |||||||||||||||||
| Cash and cash equivalents at beginning of year | 343,203 | 347,535 | |||||||||||||||||
| Cash and cash equivalents at end of year | 74,860 | 343,203 | |||||||||||||||||
| Relating to: | |||||||||||||||||||
| Cash at bank and in hand | 162,442 | 343,203 | |||||||||||||||||
| Bank overdrafts included in creditors payable within one year | (87,582) | - | |||||||||||||||||
Notes
- Basis of Preparation
These financial statements have been prepared in accordance with FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" ("FRS 102") and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value.
The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 December 2016 but is derived from those accounts which contained an unqualified audit report.
- Earnings per Share
| 2017 | 2016 | |
| p | p | |
| Basic earnings / (loss) per ordinary share | 0.0475 | (0.5026) |
| Diluted earnings / (loss) per ordinary share | 0.0424 | (0.4692) |
- Availability of Report and Accounts
Copies of the Annual Report and Accounts will be available on the Company's website.
Notes to editors:
Sandal plc commenced business in 1996 and joined NEX in March 2015. The Company designs, develops and manufactures consumer electronics products. Its business is divided into two distinct product groups, PowerConnections, a long established wholesaler and reseller of a successful and patented range of converter plugs and power cables, and Energenie, which sells a newer product range that includes energy saving products, portable charging devices and the new Energenie MiHome range of products aimed at the "Home Automation" and "Internet of Things" marketplace.
The range of Energenie MiHome home automation products makes the remote operation of everyday household appliances and energy monitoring more accessible through integration with smartphone and tablet connectivity. The Energenie MiHome range is also integrated with the major players in the home automation market including Google Nest and Amazon Echo. Energenie MiHome products are available through a number of mainstream retailers including Amazon, Argos and Sainsbury's. In addition Energenie also offers Eco and electrical, travel and energy saving products for homes and offices, reducing energy usage and the Home Automation sector. It has store listings for its current products with several large retailers including Homebase, Maplin, Amazon, Screwfix, Toolstation and ASDA.
PowerConnections is a supplier to customers, in the UK and abroad, of single-phase electrical connection products. The products are manufactured in three partner factories in the Far East and have distributors worldwide for its range of patented converter plugs. The Company's product portfolio consists of International Power Leads, Rewireable Plugs, Converters and Connectors. These products are stocked in the Far East, Australia and UK.