Unaudited Interim Results

Tristel plc

("Tristel", the "Company" or the "Group")

Unaudited Interim Results for the six months ended 31 December 2024

Tristel plc (AIM: TSTL), the manufacturer of infection prevention products utilising proprietary chlorine dioxide technology, announces its interim results for the six months to 31 December 2024, a period of further revenue growth, a 14% increase in adjusted EBITDA and a 19% increase in adjusted profit before tax. 

The Company's core business is the sale to hospitals of its proprietary chlorine dioxide chemistry used for the decontamination of medical devices under the Tristel brand, and for the sporicidal disinfection of environmental surfaces under the Cache brand. 

The Company remains cash generative, debt free, and maintains a progressive dividend policy with an 8% increase in the interim dividend. Following a solid first half, trading remains in line with expectations for the year to 30 June 2025.

Financial highlights

· Revenue up 8% to £22.6m (2023: £20.9m), 9% at constant currency

· UK sales up 7% to £8.8m (2023: £8.2m); Overseas sales up 9% to £13.8m (2023: £12.7m)

· Gross margin up to 82% (2023: 81%)

· Reported EBITDA up to £5.0m (2023: £4.7m)

o Adjusted* EBITDA up 14% to £6.3m (2023: £5.4m)

· Reported profit before tax up 9% to £3.7m (2023: £3.4m)

o Adjusted* profit before tax up 19% to £4.9m (2023: £4.1m)

· Reported EPS of 5.72p (2023: 6.50p)

o Adjusted* EPS of 8.17p (2023: 8.68p)

· Tax charge of £0.9m (2023: £0.4m)

· Interim dividend up 8% at 5.68p per share (2023: 5.24p)

· No debt and cash of £11.7m (2023: £10.8m) after paying dividends of £3.9m (2023: £3.8m)

*Adjusted for share-based payments (£0.3m) and exceptional succession costs (£0.9m), totalling £1.2m (2023: £0.7m)

Operational highlights

· Successful CEO transition from 2 September 2024

· US FDA 510(k) filing for Tristel OPH, a high-level disinfectant (HLD) foam for use on ophthalmic medical devices, with clearance expected by summer 2025

· Inclusion in the revised American National Standard for Tristel ULT technology

· Validation in the German market for the Company's wiping methodology as a HLD, with updated KRINKO guidelines

Commenting on the interim results, Matt Sassone, Chief Executive of Tristel, said:

"Tristel has delivered a strong financial performance in the first half of the year, with adjusted profit before tax increasing 19% to £4.9m supporting an 8% increase in our interim dividend. These results have been driven by higher first-half revenues, maintained gross margin, and disciplined cost control, resulting in an adjusted PBT margin of 21% (2023: 20%).

"As outlined in our AGM statement, we remain on track to meet our internal revenue growth target of 10-15% CAGR over the three years to 30 June 2025. Following an exceptional performance for our UK business in year ended 30 June 2024, our largest market has now returned to a more typical trading pattern. Against this backdrop, global revenue grew by 8% in the period (9% on a constant currency basis).

"Looking ahead, we see significant growth potential in our core medical device business, using geographic expansion as the primary driver with a focus on Spain, India, and Austria this financial year. Our largest opportunity remains the USA.

"USA ultrasound royalty receipts increased to £37k (2023: £4k), reflecting growing adoption by customers. We are ever more confident in the scalability of royalties as our US partner, Parker Labs, builds momentum. With support from our team in Boston, USA Parker is increasingly improving the sales cycle, leading to faster product take up. The significant level of interest that potential customers are showing in our product demonstrates the large unmet need for point-of-care manual high level disinfection.

"To build on this momentum, in September we made our second FDA submission-a 510(k) for Tristel OPH, our ophthalmic high-level disinfectant-and expect clearance by the end of the financial year. We have also finalised our commercial strategy and are in the process of establishing distribution channels.

"We are confident in our ability to maintain and build on our current trajectory, leveraging our expanding global footprint and innovative product portfolio." 

CEO video

Please find a link to a video overview relating to the Company's interim results from the Group's Chief Executive Officer, Matt Sassone here.

Investor presentation

Matt Sassone, CEO, and Liz Dixon, CFO, will present the Company's results in two separate events open to all investors. The same presentation will be given at both events which are being held at different times to offer convenient options for those wishing to attend. Both will be held today, Monday 24 February 2025. The first will be held online via the Investor Meet Company platform at 11.30am - investors can sign up to Investor Meet Company for free and register here. The second presentation will be held in-person in the City of London at 4.30pm. For further details and to register for this event please email [email protected]

For further information please contact:

Chairman's statement

Revenue

During the half, we reported revenues of £22.6m (2023: £20.9m), an increase of 8%. £1.3m of the £1.7m sales growth in the period was derived from additional volume of product sold and £0.4m from price increases. Whilst sales growth was slower in this first half than in recent years, we have identified the key challenges and implemented corrective measures.

Two primary factors impacted performance:

· A higher than normal turnover of sales staff in France and Australia. This has now stabilised, enabling our focus in these key markets to be re-established.

· A dilution of our commercial efforts in the Tristel Medical device portfolio, due to a focus by our sales teams onto the newer and less well-known Cache Surface range. We are refining our approach to ensure a more balanced sales strategy between the two product ranges.

Tristel Medical Device product sales increased by 8% to £19.6m (2023: £18.3m) and Cache Surface products by 4% to £1.7m (2023: £1.6m).

Sales increased by 7% in the UK, to £8.8m (2023: £8.2m), and overseas by 9% to £13.8m (2023: £12.7m). Overseas sales represented 61% of the total during the half (2023: 60%) with international expansion once again driving growth.

Costs, Margins and Profits

Group profit before tax, adjusted for exceptional items and share-based payments increased by 19% to £4.9m (2023: £4.1m) assisted by cost control and a steady gross margin. This represents an adjusted PBT margin of 21% (2023:20%). Gross margin has remained steady at 82% (2023: 81%) and administration expenses, excluding exceptional costs and share-based payments, increased by 6% to £13.3m (2023: £12.5m). Reported Group profit before tax increased by 6% to £3.7m (2023: £3.4m).

Exceptional costs and share-based payments

The CEO succession process, which was completed in September 2024 with the appointment of Matt Sassone and retirement of Paul Swinney, resulted in an exceptional overhead cost of £0.9m. The amount includes a retirement payment to the outgoing CEO and founder and relocation and recruitment costs for the incoming CEO.

The share-based payment charge of £0.3m is derived from the Group's All-Staff share option scheme and is valued via the Black-Scholes model. The Board believes that these share schemes help to retain staff and link their interests to shareholders. The value of share-based payments is significantly influenced by the volatility of the Company's share price, a factor that is out of the Board's control.

Profit and earnings are reported on both an adjusted basis, adding back share-based payments and succession costs, alongside unadjusted, so that the underlying profitability of the Company can be understood.

Earnings and Dividend

Earnings per share (EPS) were 5.72p (2023: 6.50p). EPS adjusted for share-based payments and exceptional items was 8.17p (2023: 8.68p). An increase in the effective tax rate from 10% to 25% has negatively impacted EPS.

The Board is recommending an interim dividend of 5.68 pence (2023: 5.24 pence) to be paid on 11 April 2025. The associated ex-dividend date will be 20 March 2025 with a record date of 21 March 2025.

North and Central America

Income from the Americas in the period delivered £96k (2023: £83k) with royalties derived from Ultrasound sales in the USA generating £37k. Whilst at face value this is a small number, it does represent the product being used for more than 50,000 decontamination procedures. As we acknowledged in our FY24 results, the sales process is taking longer than initially anticipated, due to the stringent purchasing bureaucracy of signing up new healthcare accounts. However, we are very encouraged by the consistent and significant level of interest that potential customers are showing in our products, in what is a very substantial and growing market. We believe that the support that we are providing to Parker Labs and to these customers is increasingly smoothing the journey through hospitals' Value Assessment Committees, leading to faster product take up.

We are now seeing clear signs of sales traction after navigating the lengthy purchasing cycles, with notable examples of success. For example, a leading health system in Florida rolled out our product across multiple sites. Having first purchased in June 2024, this system is now utilising ULT for more than 1,500 cycles monthly. In the same vein a prominent hospital system in Massachusetts has expanded from initial use at one centre to adoption across three sites with plans to drive adoption across the whole system during the second half of this FY. In addition, our strategy to target less-bureaucratic physician offices is also yielding results, with growing adoption in this sector. In the first six months, we conducted over 2,200 online training events, ensuring that customers are well-equipped to use our products effectively.

Our longstanding partner, Parker Labs, remains deeply committed to the growth plan. It has invested heavily in building a national sales force while leveraging its established distribution network for the USA and Canadian ultrasound markets. This dual approach strengthens our market presence and supports long-term growth.

With the combination of growing clinical use, expanding customer adoption, and Parker Labs' continued investment, we are confident in the long-term potential of the Americas market and remain committed to maximizing this opportunity.

Breakdown of Americas revenues

*USA product sales denote raw materials and initial products required for launch.

In September 2024, we filed for Premarket Notification 510(k) with the U.S. Food and Drug Administration (FDA) for Tristel OPH, our high-level disinfectant foam for use on ophthalmic medical devices and had originally targeted the end of the calendar year for clearance. As stated in our AGM Statement, the Group subsequently received a request for additional information and remains confident that we can provide this within the required 180-day time frame.

Cache opportunity post-UKCA, MDR & CE Certification

We remain enthusiastic about the opportunity for Cache and its potential to introduce chlorine dioxide as an environmental surface disinfectant in hospitals. Expanding beyond our core medical device disinfection business, Cache strengthens our position in infection prevention while diversifying our portfolio and building on the success of Tristel Fuse and Jet.

The global healthcare environmental surface disinfection market is valued at $5 billion, and while this presents a significant opportunity, it is also a highly commoditised market where established practices and cost-driven decisions can make adoption challenging. Customer feedback following the UKCA, MDR, and CE certification of Tank has reinforced this understanding, highlighting the need for a more targeted strategy.

Rather than aiming for broad market adoption, we are focusing on specific clinical areas where infection prevention is a clear priority, such as intensive care units, operating rooms, neonatal, dialysis units and clinical laboratories. These settings have higher standards for disinfection, making them more receptive to Cache's superior performance and benefits.

With this refined approach, we are confident that Cache will address the most critical infection prevention needs in hospitals, ensuring it delivers long-term value as part of our broader portfolio.

Product technology endorsements

In the period, Tristel ULT technology was included in the revised American National Standard, a set of guidelines which state the selection and use of liquid HLDs and gaseous chemical sterilizers that have been cleared for marketing by the FDA for use in hospitals and other healthcare facilities. The Group participated in the public consultation for the guidelines and the update published ensures that chlorine dioxide foam is recognised as a method of HLD.

We were also pleased to announce that in Germany, updated KRINKO guidelines (Commission for Hospital Hygiene and Infection Prevention) strongly endorsed wiping as a method for HLD, further validating our technology and driving increased adoption.

We believe both the above will help drive adoption of Tristel's HLD products across both geographies.

Board changes

In September, we welcomed Matt Sassone to the Board as CEO, following a smooth succession with Paul Swinney, our founder and former CEO of 30 years. Matt joined the Group from Masimo Corporation (NASDAQ: MASI), a global medical technology company, where he was Senior Vice-President Marketing. During his tenure at Masimo, Matt lived and worked in the USA, gaining invaluable experience in the American healthcare market. His substantial experience in the medical industry and Board experience on AIM supports our growth plan to deliver exceptional value to the Group's customers and stakeholders.

Additionally, at our December 2024 AGM, David Orr stepped down from the Board as a Non-Executive Director after completing his nine-year tenure of dedicated service, for which we thank him.

Outlook and targets

We are pleased with a solid first six months and the Board remains confident in the outlook for the year, with international expansion continuing to be a key driver of growth. Our strategic focus remains on scaling our presence in high-potential markets, strengthening our commercial execution, and optimising our product portfolio.

Through continued investment in innovation, market expansion, and execution, I believe that Tristel continues to be well-positioned to drive long-term shareholder value. We look forward to further progress in the second half of the year and beyond.

Bruno Holthof

Chairman

Condensed Consolidated Income Statement for the six months ended 31 December 2024

Earnings from continuing operations before interest, tax depreciation, amortisation and impairment for the period ended 31 December 2024 were £5,019,000. (Period ended 31 December 2023: £4,744,000). Year ended 30 June 2024: £9,755,000.

31 December 2023 has been restated to align to IAS 2 in relation to classification of expenditure included in cost of sales, the restatement has no effect on the Profit for the period.

Condensed Consolidated Statement of Comprehensive Income for the six months ended 31 December 2024

Condensed Consolidated Statement of Financial Position as at 31 December 2024

Condensed Company Statement of Financial Position as at 31 December 2024

Condensed Consolidated Statement of Changes in Equity for the six months ended 31 December 2024

Condensed Company Statement of Changes in Equity for the six months ended 31 December 2024

Condensed Consolidated Statement of Cash Flows for the six months ended 31 December 2024

Condensed Company Statement of Cash Flows for the six months ended 31 December 2024

Notes to the Financial Statements for the six months ended 31 December 2024

Basis of Preparation

For the year ended 30 June 2024, the Group prepared consolidated financial statements under UK adopted international accounting standards. These condensed consolidated interim financial statements (the interim financial statements) have been prepared under the historical cost convention. They are based on the recognition and measurement principles of UK adopted international accounting standards which are effective from 1 July 2024.

Forthcoming requirements: This table lists the recent changes to the Standards that are required to be applied for annual periods beginning after 1 January 2024 and that are available for early adoption in annual periods beginning on 1 January 2024

There are no other standards that are not yet effective and that would be expected to have a material impact on the Group in the current or future reporting periods and on foreseeable future transactions.

None of the standards, interpretations and amendments effective for the first time from 1 July 2024 have had a material effect on the financial statements.

Accounting Policies

The interim report has been neither audited nor reviewed and prepared on the basis of IFRS accounting policies.

The accounting policies adopted in the preparation of this unaudited interim financial report are consistent with the most recent annual financial statements being those for the year ended 30 June 2024. An additional policy is required to define exceptional costs and is detailed below: 

Exceptional costs 

The Group has incurred non-recurring costs in relation to the succession of the outgoing CEO. The amount includes a retirement payment to the outgoing CEO and founder and recruitment costs for the incoming CEO. These costs are recorded separately to ensure transparency within the financial statements. 

The financial information for the six months ended 31 December 2024 and 31 December 2023 has not been audited and does not constitute full financial statements within the meaning of Section 434 of the Companies Act 2006.

The financial information relating to the year ended 30 June 2024 does not constitute full financial statements within the meaning of Section 434 of the Companies Act 2006. This information is based on the Group's statutory accounts for that period. The statutory accounts were prepared in accordance with UK adopted international accounting standards and received an unqualified audit report and did not contain statements under Section 498(2) or (3) of the Companies Act 2006. These financial statements have been filed with the Registrar of Companies.

Group revenue lines are split into fourteen geographic regions, which span the different Group entities. In accordance with IFRS 8, aggregation criteria has been applied to five operating segments where similar economic characteristics are shared. The directors consider the operating segments to have similar economic characteristics as they have similar operating margins, and the nature of products sold, and customers are similar. Management consider these operating regions under five reportable segments. The geographic segments consider the location of the sale and product type sold, which is split into three sub divisions. The Company's operating segments are identified initially from the information which is reported to the chief operating decision maker which for Tristel is the CEO.

The group uses a matrix to analyse segments, to analyse the geographic segments against product divisions. The first product division concerns the manufacture and sale of medical device decontamination products which are used primarily for infection control in hospitals. These products generates approximately 87% of Company revenues (2023: 87%).

The second division which constitutes 8% (2023: 8%) of the business activity, relates to the manufacture and sale of hospital environmental surface disinfection products.

The third division addresses the pharmaceutical and personal care product manufacturing industries, veterinary and animal welfare sectors and has generated 5% (2023: 5%) of the Company's revenues this year.

The operation is monitored and measured on the basis of the key performance indicators of each segment, these being revenue and adjusted profit before tax, and strategic decisions are made on the basis of revenue and profit before tax generating from each segment.

6 months ending 31 December 2024 (unaudited)

6 months ending 31 December 2023 (unaudited)

Year ending 30 June 2024 (audited)

6 months ending 31 December 2024 (unaudited)

6 months ending 31 December 2023 (unaudited)

Year ending 30 June 2024 (audited)