29/9/2009
Unaudited Interim Accounts for the period ended 30 June 2009
Eruma plc, the AIM traded specialist provider of counter terrorism, intruder prevention
products and intelligent emergency lighting is pleased to announce its interim results for the
six month period to 30th June 2009.
Highlights
1.Revenue increased by 53% from £366k in the first six months of 2008 to £561k for
the equivalent period this year
2.Gross profit increased by 44% from £151k in the first 6 months of 2008 to £218k for
the equivalent period this year
3.Distribution expenses were reduced by 4% and administrative expenses by 17%
compared with the first 6 months of last year, despite the significantly higher turnover
4.The loss before tax was reduced by 23% against the same period last year
CHAIRMAN’S STATEMENT
Review and Outlook
The hard work and investment we made in 2008 has begun to reap rewards in 2009 with
much improved performance across all key measures of the business. We are pleased to
report increases in both orders and revenue and a reduction in costs for the period with a
growing and strong pipeline of new business already identified. By the end of August 2009 we had already exceeded our total 2008 revenue.
We secured another landmark order in May for our counter terrorism solution which is now nearing completion of its installation. Due to the nature of such projects, the potential
security implications and our ongoing obligations to our clients’, details of our counter
terrorism installations must remain confidential and so we are unable to provide specific
details on individual clients. However, repeated testing has shown that our product delivers an unrivalled level of protection against bomb blasts and will be critical to the success of any facility in which it is installed being able to minimise casualties and continue its function in the aftermath of an attack. We are earning ourselves a reputation for quality, reliability and consistency of execution in what is a specialised community of contractors servicing this market.
The partnership announced with Pentagon Protection plc in June 2009, has proved to be
successful, already delivering revenue to the company. The partnership has enabled us to
revisit past opportunities. We are now offering a new solution comprising our intruder
prevention blinds and Pentagon protective film to deliver the right balance of protection in
line with budget requirements.
Trading update post period
We are continuing to secure benefits from efficiency gains and cost reductions wherever we can without compromising the future scalability of the business. We have put in place a mixture of funding solutions, including convertible loan notes and the placing of new
ordinary shares that have delivered a strengthened balance sheet which in turn will enable us to secure trade and invoice finance. These measures are designed to ensure we will have sufficient working capital to take us through to a becoming a sustainable, operationally profitable business in 2010 and to take advantage of large scale opportunities open to the business without putting us under undue operational and financial pressure.
In July we secured a significant contract award at Ealing Hospital for our intelligent
emergency lighting. This is the first phase of a multi-phase project that will be completed in 2010. This order, coupled with the intruder prevention and counter terrorism orders has demonstrated that our products offer unique benefits to distinct markets. Each has generated significant interest both within the UK and on an international stage which we are developing during the second half of 2009 and early 2010.
In August our new anti ram-raid gate solution was launched to market and we expect to see significant interest and take up in this unique product offering. The first deployment has been successfully made at City Link. As Ken Semple, the company’s Security Compliance General Manager says; “At City Link, the UK’s premium express delivery company, we are always We have successfully completed our sales reorganisation making our whole portfolio of products available to a larger and strengthened sales force, which are now focused on geographical sales territories managed across three regions within the UK. This increases our capability to develop client relationships more effectively and deepen the level of account penetration.
Our international business development continues with some notable opportunities
developing for our counter terrorism solutions across many of the trouble hotspots in the
world. Our access to a wider network of sales agents through our partnership with Pentagon is opening new doors and raising our profile on critical projects across the globe. The emphasis is currently on counter terrorism, although a number of new infrastructure projects and property developments are providing a fertile ground for our energy saving intelligent emergency lighting products as well.
We have successfully qualified our products to be eligible for Carbon Trust funding schemes such as Salix in the public sector and other schemes for the SME markets. We are now in a position to offer clients access to interest free funds to enable them to invest in our solutions sooner and realise the benefits they afford in protection and energy reduction.
We are pleased to announce that at the end of August 2009, we had already exceeded the total revenue for 2008. This excellent performance coupled with the broadened portfolio of products and growing pipeline offers great potential for the remainder of the year that we intend to capitalise on.
Our emphasis is on excellence in execution across our core processes such as marketing,
sales, manufacturing and installation. We have strong financial and business management
policies and systems in place that deliver actionable intelligence that allows us to drive the
business forward in a timely manner.
Your board is confident that its strategy of organic growth and expansion through
partnerships together with a broadened product portfolio will enable it to successfully take an increasingly larger share of its key markets at an attractive level of profitability that will deliver the returns to shareholders from their investment.
David Alexander
Chairman
To download a PDF copy of the reports click here
