CyanConnode Holdings plc (LON:CYAN), a global leader in Narrowband Radio Frequency (RF) Smart Mesh Networks, has announced its audited results for the year ended 31 March 2024.
Financial highlights
· Increase of 60% in revenue to £18.7m in FY24 from £11.7m in FY23, the highest annual revenue for the Group to date after four consecutive years of growth[1] as a result of increased order book and acceleration of deployments in India
· Increase in gross profit to £5.6m in FY24 (FY23: £4.2m) as a result of high-volume RF node sales through the Indian entity, and sales of third-party hardware in the Middle East North Africa (MENA) region
· Reduction in gross margin to 30% (FY23: 36%) as a result of sales of third-party hardware and large premiums paid during the year on purchases of end-of-life components for the Group’s previous version of gateway. A new, lower cost version of the gateway was released in Q4 of FY24. Gross margin in the first two years of projects in India is expected to be around 35-40% due to revenue on hardware in the first two years of a project. After year two of each project it is expected gross margins of greater than 90% will be achieved due to the transition to services revenue
· Operating loss increased to £4.2m in FY24 (FY23: £3.3m) as a result of increased costs incurred throughout the Group offsetting the increased revenues, largely attributable to increased headcount required to scale up the business to deploy its growing backlog of orders and develop industry leading hardware and software required by projects being deployed
· EBITDA loss increased to £3.8m in FY24 (FY23: £2.9m)
· Increase in adjusted EBITDA[2] loss to £2.8m in FY24 (FY23: £1.6m loss) as a result of lower gross margin % and increased operational costs
· Decrease in cash position to £0.8m in FY24 (FY23: £4.1m)
· Increase in cash collected from customers to £16.9m in FY24 (FY23: £10.7m) broadly in line with increase in revenues
Operational Highlights
· Orders for 2.7m modules won in India during the period (FY23: 2.3m modules) taking the cumulative order book to 6.3m during the financial year
· Order for 101,360 Cellular Network Interface Card (CNIC) modules won for a deployment in Thailand
· Further new order for 52,300 NBIoT hubs won from the Middle East North Africa (MENA) region
· £2.7m (before expenses) raised in November 2023 through an oversubscribed placing and subscription, together with the issue of warrants at an exercise price of 15.0 pence per ordinary share, which would provide a potential further £4.1m if fully exercised
· 1,370,000 Omnimesh Radio Frequency (RF) Modules shipped against current contracts during the period (FY23: 391,000), along with 55,200 NB-IoT gateways and 5,340 Cellular gateways
· Project Management: JVVNL TN72 & TANGEDCO projects now under Facility Management Services (FMS), ensuring streamlined operations and maintenance
· Gateway 200 Dual SIM: Successfully released the ‘Gateway 200 – Dual SIM’ version, enhancing network reliability and connectivity
· Integrated Meter OEMs: Integrated with twelve meter Original Equipment Manufacturers (OEMs)
· Memorandum of Understanding (MOU) signed with Alfanar to explore opportunities in Advanced Metering Infrastructure (AMI) projects
· Investment into recruitment, to scale up the business, and research and development to develop further products in response to market demand
· CSR Initiatives: Supported the education of over 1000 school children, with more than 750 being girls, under our CSR initiatives
· CyanConnode India recognised as Dun and Bradstreet ‘Start-Up 50 Trailblazer’
· Exhibitions: Participated in and showcased our solutions at DistribuElec 2024, where we were awarded the best booth
Post Year End Highlights
· 265,000 Omnimesh RF Modules and associated products ordered from a subsidiary of IntelliSmart Infrastructure Private Limited, taking cumulative order book in India alone to 6.6m modules, spanning sixteen utilities, across eleven states in India
· CyanConnode India’s subsidiary, DigiSmart Networks Private Ltd successfully empanelled as an Advanced Metering Infrastructure Service Provider (AMISP) for both RF and cellular, making it eligible to bid for smart metering contracts under the Revamped Distribution Sector Scheme (RDSS)
· Revenue of £3.5m in the first quarter of FY25, being 25% higher than the same period in FY24
· £5.0m cash received from customers in the first quarter of FY25, being 40% higher than the same period on FY24
· Cash at end of June 2024 of £1.1m
· Win ratio in India in terms of tenders to date of 29%, and 16% in terms of volumes
· Commencement of setup of a subsidiary in the United Arab Emirates (UAE) to promote business in the MENA region
· Changes to organisation to strengthen leadership in India and streamline global operations by having all engineering and operations reporting into the MD CEO of India
· Key milestones such as Site Acceptance Tests (SATs) and project go-lives achieved across several key projects
John Cronin, Executive Chairman of CyanConnode, commented:
“FY24 marked another exceptional period for CyanConnode in terms of our strategic footprint and revenue, with revenue growth of 60% over FY23, significantly exceeding market expectations.
During the period and since, our order book has continued to grow; for India alone, cumulative orders stand at approximately 6.6 million Omnimesh modules. To the end of March 2024 we had successfully delivered around 2.8 million Omnimesh modules, and we anticipate that deliveries of Omnimesh modules will significantly increase during FY25.
We were also delighted with the empanelment of DigiSmart as an AMISP for both RF and cellular, which we believe will present significant further opportunities for the Company. More recently we have also been pleased with the successful achievement of milestones such as SAT and go-live for some of our key projects.
I look forward to an even more successful FY25!”
