Interim Results for the six months ended 31 March 2024

- On track first half revenues, driven by strong execution
- Vicon secures seven markerless cornerstone customers to redefine future of motion capture
- Industrial Vision Systems, performing well, opening up smart manufacturing opportunities
- >90% full year revenue visibility, a growing pipeline and resources for targeted M&A

11th June 2024 - Oxford Metrics plc (LSE: OMG), the smart sensing and software company, servicing life sciences, entertainment and engineering markets, announces unaudited interim results for the six months ended 31 March 2024.

Commenting on the results Imogen Moorhouse, Chief Executive, said: “Now over halfway into delivering our five-year plan, our teams are in full execution mode. I’m pleased to announce that we are making clear progress both operationally and financially towards our goals, as we report on track first half revenues, demonstrating strong Vicon execution.

Our recent acquisition of Industrial Vision Systems has been a successful move, it’s performing well and we are excited about the opportunity to drive yet more applications into the smart manufacturing space. We have the financial resources to do so and are working on a number of interesting M&A opportunities to build out our presence in this growing vertical.

As Vicon works towards commercialising markerless, which enables 3D motion capture without the need to wear motion capture suits or markers, we are working with seven cornerstone customers to make the product the gold standard.

Looking ahead, Oxford Metrics enters the second half with >90% visibility of full year revenues and with a growing pipeline, the Board believes the Group is well placed to deliver results in line with current market expectations.”

_{* Profit/(loss) Before Tax from continuing operations before Group recharges adjusted for share-based payments, amortisation of intangibles arising on acquisition and exceptional costs
** FY23 comparative restated at $1.25/£ exchange rate}

Financial Highlights

• Headline Group revenue of £23.5m, up 10.5% (H1 FY23: £21.3m).
• Group adjusted profit before tax of £4.0m (H1 FY23: £4.5m), reflecting planned investment in the five-year plan to develop and commercialise markerless.
• Order book of £3.0m (FY23: £11.3m / H1 FY23**: £21.9m), reflecting normalisation of customer buying behaviour post supply chain challenges.
  • Strong sales pipeline with >90% visibility on full year revenue
• Adjusted earnings per share 2.63p (H1 FY23: 2.94p).
• Strong balance sheet with net cash position of £54.8m as at 31 March 2024 (H1 FY23: £63.6m), providing considerable resources to continue pursuing targeted M&A.
• Cash generated by operations of £2.2m (H1 FY23: £0.4m) with cash deployed for working capital purposes to augment inventory and underpin second half performance.

Operational Highlights

First half revenue driven by strong execution

• Vicon’s revenue grew 2.2%, at a headline level, to £21.8m (H1 FY23: £21.3m), (on a constant currency basis underlying growth was 3.3%), driven by Vicon’s strong execution.
• Order book returns to more normal levels:
  • Vicon customer buying behaviour normalising - a trend we expect to continue.
  • Total Order in-take in H1 of £15.0m (H1 FY23: £19.8m).
  • Total Orders-in-hand as at 31 March 2024 of £3.0m (FY23: £11.3m / H1 FY23: £21.9m).

• Engineering revenues of £4.8m, up 56.6%.
  • Contracts secured for automotive, aerospace and metrology sectors.
  • Satellite Applications Catapult is using Vicon to track robots and simulate orbital environments.

• Life Sciences revenues of £8.0m, up 38.3%.
  • Valkyrie accreditation with UK Conformity Assessment (UKCA) medical device
    mark, enabling systems to be delivered to hospitals around the world including:
    • New customers: Hong Kong Children's Hospital, Yamagata University Hospital (Japan), Vinmec International Hospital (Vietnam);
    • Long-standing customers: Guy's & St Thomas' (UK), Shriners Children's Hospital (USA); and
    • The Nuffield Orthopaedic Centre in Oxford, one of Vicon’s first-ever customers.
  • New Valkyrie customer, University of Sydney
    • Using system for research into head injuries with Rugby League and Rugby Union
    • Aim to reduce players concussions in the sport.

• Entertainment revenues of £8.5m, down 22.8%, following a very strong FY23 APAC performance that is now seeing delayed effects from the global games industry contraction.
  • Valkyrie delivered, through partner Lux Machina, to London College of Fashion and MyWorld, a new global centre of creative technology.
  • Paper Games, in China, added an additional large Valkyrie system to add realism to their female-focused games and their VTuber, Nikki.

• Location-based Entertainment (LBE) revenues of £0.4m, down 73.7%, due to delayed partner rollouts that we expect to deliver in H2 FY24.
  • Sandbox VR, now operating in over 46 locations in multiple countries.
  • New partnership with Apparel Group:
    • Plan to open 25 new locations by 2028;
    • Across the UAE, Kingdom of Saudi Arabia, Qatar, Kuwait, Bahrain and Oman.
  • Immersive Gamebox trialling experiences across Merlin Entertainment sites following multi-million pound and multi-territory agreement.

• Markerless becoming a reality and presents a significant opportunity
  • Vicon has now partnered with seven cornerstone customers.
  • Together we are further developing and testing the technology for commercialisation.
  • Cutting-edge advancements will redefine motion capture and content production.
• With our focus firmly on markerless - where we see the largest growth opportunity – we have taken a strategic decision to discontinue IMeasureU (IMU) New Zealand operations.
  • Actively engaged in planned discussions to sell the IP.

Smart manufacturing

• Acquisition of Industrial Vision Systems (“IVS”) completed and is performing well.
• Delivered revenues of £1.8m in the first half and an orderbook of £1.0m.
• Brings new niche market strength in smart manufacturing.
• High precision, automated quality control used across numerous industries.
• Multiple new contracts secured as demand continues for automated inspection and quality control.
• IVS goes into the second half with a healthy sales pipeline and clear growth opportunities as part of Oxford Metrics.

Outlook

• >90% visibility of full year revenues and a growing sales pipeline ahead of this time Last year.
• Deploying resources to actively pursue M&A to build out smart manufacturing and IVS.
• Encouraged by feedback of markerless advancements as our teams and partners work hard to commercialise the offering, optimising the future of motion capture.
• Going forward we do not expect to maintain a significant order book with the return to customer trading patterns consistent with those seen pre-pandemic.
• New CFO designate, Zoe Fox to be appointed Group CFO effective 1 July 2024.
• The Board believes Oxford Metrics is well placed to deliver full year results in line with current market expectations.

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