Versarien PLC (LON:VRS) Chief Executive Officer Neill Ricketts caught up with DirectorsTalk for an exclusive interview to discuss their latest interim results, what has driven the growth, significant interest from OEM’s worldwide, the main focus areas for the next few months and the trading outlook for the next financial year. Neill also shares his thoughts on the tweets for Richard Branson to take a look at Versarien.
Q1: First off, congratulations on this good set of results! Can you talk us through the highlights?
A1: For us, these are a very solid set of results, we’re very pleased with them as a management team and the Board are really over the moon with them.
Highlights really are that the sales increased 167% up to £4.38 million from £1.64 million, that’s a huge increase, and we’ve also managed to reduce the losses in that period by almost half as well, EBITDA level.
So, for us, this underpins that the business is heading in the right direction, we’re using the cash that we’ve received in a very wise way and that we’re now in a position where we can exploit, which is probably the most significant part of the whole release, these massive set of enquiries that we have. So, we’ve obviously been very busy on the graphene side, we’ve already announced several collaborations and we look forward to adding more news as and when it comes in.
Q2: Now, as you say, revenues have grown significantly, what has driven this growth?
A2: Our underlying businesses, our conventional businesses, have started to pick, we have suffered from the oil and gas crisis that’s been going on, as every supplier has in that area, but Total Carbide has been able to diversify, and it’s been able to run the business extremely well. During this time, we’ve also relocated the factory, that’s now bedded down and that business is starting to turn a corner. Our plastics company, ACC Cyroma, is also doing very well and we’ve seen an increase in sales there.
So, as a group, our underlying businesses are all doing well and that’s what’s driving the growth.
The graphene at the moment is really a development play and we’re in a situation now where we have a large number of enquiries from all of the activities that we’ve been doing. It’s down to us now to turn those enquiries into numbers and that is what the company is really focused on doing at the moment.
Q3: As you say, Versarien have reported significant interest from OEM’s worldwide, how are you hoping this will add to Versarien’s operation?
A3: As we announced more recently, we raised £2.8 million from a requirement of only £1.2 million and that’s going to be used to scale up the graphene businesses. We have two businesses, as you know, we have the business which came out of Manchester, 2D-Tech, that process is being scaled up with the addition of more capital equipment and more people in order to satisfy the number of enquiries we’ve got. We’ve then got a very similar process going on at the University of Cambridge where we’re scaling up the inks process and that’s been assisted with the help of Innovate UK.
Q4: What are the main focus areas then for you in the next few months for continued growth?
A4: For me, as the CEO, I am all focussed around graphene and exploiting these opportunities, every opportunity we get to be able to tell everybody that we’re quickly moving into being the leader in this field, we take. That means an extensive period of travelling, it means that there are lots of opportunities to talk and obviously, the thing that’s really moved this on in the last few months is our ability to meet ISO standards. There is a bit within the release which talks specifically about that but that really separates us from most, if not all, of the graphene players.
Q5: How is trading going and what’s the outlook for the next financial year?
A5: Outlooks are always difficult when you have development businesses, we know what’s going on in our ore traditional businesses but I’m sure that we’ll be able to update the market in the near future with our forecasting processes and that starts in the next few months as we start to look towards the next financial year. So, let’s hold back on that one and talk about that in the coming months.
Q6: Now, you’re probably aware that there’s been a few tweets for Richard Branson to take a look at Versarien, firstly how do you feel about that?
A6: I think it’s fantastic, I think for Versarien, a company I started in a garage in 2011, to be considered worthy enough to be able to have these kind of conversations is great. There’s obviously, for me personally, a big statement of intent from us that that’s the kind of people we want to deal with, so we look forward to, hopefully, maybe having a conversation with him.
Q7: How do you think VRS would be able to benefit a company like Virgin?
A7: At the moment, there’s a massive space race going on and there’s three major players and our products, across the whole group, have a natural fit with what’s going on in those areas. So, for us, it’s a natural thing where the industry is looking at light-weighting and there’s none more specific, or involved in that, than the space industry. So, with all the information we’ve received from the independent testing over the last few months and years, it’s obvious to us that that would be a place to go hunting.
Q8: There’s always the possibility that Richard Branson will think ‘well, it would just be easier to buy Versarien’, how would you react to a situation like that?
A8: I think that’s a conversation that we’d need to have with our shareholders, we are now in a great position in terms of raising our profile considerably and we have interest from major OEM’s. It’s always a conversation that the Board are aware of, it’s not my intention as a CEO to sell the business but that’s not my decision anymore, that’s a decision that would have to go to the shareholders and let’s have a look at what goes on.
We, the management team and the Board, are fixated on building a successful business and that’s our intention.
Q9: Finally, just coming back to the question about the significant interest from OEM’s, have Versarien PLC had any enquiries from any major players yet?
A9: Yes, we’ve already announced two, so IAI is effectively the Israeli version of Airbus, we announced that a few months ago and then more recently, we announced a collaboration with one of the biggest consumer goods manufacturers, that’s progressing well, and that project should be a very high-profile activity for both the company and the client.
In terms of other things, I don’t think I’ve ever been in a position where we’ve had as many good enquiries for the company as we’ve currently got and there’s not a day goes by when something new doesn’t come along or peaks our interest. So, still lots and lots to go at, still lots and lots to work through, we’ve obviously done a few shows recently and the list of things to do isn’t get shorter, let’s put it that way.
