Getech, a world leading locator of subsurface resources, announces its unaudited interim results and report for the six months to 30 June 2023 ("H1 2023" or the "Period").
'Restructured and re-focused on core expertise of locating subsurface resources'
Operational and Strategic highlights
· Strategic review of the business completed over the last 6 months, resulting in targeted objectives to:
o re-focus the Company on the core business of locating subsurface resources;
o extend Globe's capabilities to identify a wider range of assets e.g. Zinc, Lithium and Phosphates;
o reduce cost base by £2 million and switch to developing H2 Green's assets in partnership;
o generate future revenues from subscription sales and solutions coupled to asset participation in large scale projects where appropriate;
o become cashflow positive in the near term and
o increase and target marketing and sales activity towards the $1 trillion Energy Transition market.
· Significant progress has already been made on all of the strategic priorities set out above.
· Interim executive Chairman Richard Bennett, appointed in February 2023, has agreed to become Acting Chief Executive Officer of the Group with Michael Covington, currently Non-Executive Director, to be Chairman Designate. Both appointments expected to be confirmed as permanent in due course.
· H1 2023 revenues of £1.9 million (H1 2022: £2.7 million including a one-off £0.7 million transfer payment) reflects lower sales volumes in oil and gas.
· Strong orderbook value of £4.4 million (30 June 2022: £4.8 million) with £1.4 million of the orderbook expected to convert in H2 2023, and a further £1.5 million due in FY 2024. This demonstrates multi-year commitment from our customers to use the Globe geoscience platform.
· Annualised recurring revenue increased to £2.6 million with the addition of new Globe and software customers (December 2022: £2.4 million).
· On an unchanged cost base, recorded a loss before tax and exceptional costs of £2.2 million (exceptional costs being £0.7 million)
· Cash totalling £2.0 million at 30 June 2023 (31 December 2022: £4.3 million), with the proposed sale of Kitson House progressing
· Good pipeline of orders support the traditionally stronger second half of the year, boosted by the uplift in sales, marketing and PR activity across the business, although tempered by delays to spending decisions
Richard Bennett, Getech Executive Chairman commented:
"Completing the strategic review of the business has enabled us to set out our plans for the Company's future. It was clear that the Group was likely to become financially and operationally over-extended. Accordingly, we have decided to focus on our core expertise of locating subsurface assets, transforming our predictive capabilities with the latest artificial intelligence techniques, and to significantly reduce our cost base, thereby creating a financially lighter and more focused business with which to target future growth.
The results for H1 show a reduction in sales over the comparative period in the prior year, when performance was boosted by a large one-off payment. However, our order book is stable and we are generating a good pipeline of future projects, the majority of which come from outside of the oil and gas market. There is no doubt that Getech's expertise is required to locate the resources needed to power the substantial Energy Transition market - clean energy and critical minerals - and we are positioning the business to do exactly that."