Struggling manufacturer looking to make progress across range of areas
Struggling manufacturer Versarien has issued an update as it looks to revive its fortunes.
The Gloucestershire business has been fighting for survival and has been looking to sell off parts of its business.
The AIM listed company has been looking to preserve intellectual property within the group whilst reducing operating costs.
The firm posted a £3.4m pre-tax loss in its half-year results with bosses saying the tough economic conditions had delayed the commercialisation of its products.
The company said its cost base has been reduced significantly with unaudited LBITDAE (loss before interest, tax, depreciation, amortisation and exceptional items) and is now at a much lower run rate than in the first six months of the financial year, with a consequent reduction in cash burn.
Despite this reduced cost base, the company continues to make progress in line with its stated strategy to:
- maintain and strengthen the group’s scientific teams supported by grant funding applications;
- to use the group’s internally generated know‐how in the areas of leisure and construction leisure to be a manufacturing light operation as Versarien works with its prospective customers;
- as commercial traction develops, to licence Versarien’s technology, brands and manufacturing know‐how; and
- to divest non‐core activities and Korean assets to reduce the requirement for funding from external sources.
The company’s research and development team has been slimmed down significantly during 2023, due to cost cutting to concentrate on its strategic objectives.
In line with the Company’s strategy, it continues to focus on the development opportunities it has, including submitting applications to participate in Innovate UK, Horizon Europe and other grant-funded projects with various consortia comprising leading industry participants.
Despite the reduced cost base and income being received, the company’s cash resources continue to be constrained whilst it seeks to sell both its mature businesses and the IP and equipment arising from the acquisition of assets from Hanwha Aerospace in December 2020.
Discussions are ongoing with third parties interested in acquiring these assets, but there is no guarantee that sales can be satisfactorily concluded.
As a result Versarien expects to continue to require further funding to support its activities, including potentially available grant income and the potential issue of additional equity.