TIDMSDI
RNS Number : 2338V
SDI Group PLC
02 December 2019
SDI Group plc
("SDI", the "Company" or the "Group")
(AIM: SDI)
Acquisition of Chell Instruments Limited
The Board of SDI Group plc, the AIM quoted group focused on the
design and manufacture of scientific and technology products for
use in digital imaging and sensing and control applications, is
pleased to announce the acquisition on 29 November 2019 of Chell
Instruments Limited ("Chell") for a consideration of GBP4.3m plus
an additional cash payment for net assets at completion (the
"Acquisition").
Highlights:
-- Chell specialises in the design, manufacture and calibration
of pressure, vacuum and gas flow measurement instruments for a
variety of sectors including aerospace, vehicle aerodynamics, gas
and steam turbine testing and power generation industries
-- For the year ended 31 December 2018, Chell achieved revenue
of GBP4.7m, gross profit of GBP2.5m and profit before tax of
GBP0.78m
-- The Board has identified areas within Chell that have the
potential for growth using the strong management team the company
has recruited over the years
-- The Acquisition is expected to be earnings enhancing in its first full year of ownership
Ken Ford, Chairman of SDI said:
"Chell Instruments is another step in our Group growth strategy.
It is a complementary fit providing potential areas for growth. The
acquisition is in line with our previously announced strategy of
organic and acquisitive growth and is expected to be earnings
enhancing in its first full year of ownership."
About Chell Instruments Limited
Chell specialises in the design, manufacture and calibration of
pressure, vacuum and gas flow measurement instruments for a variety
of sectors including aerospace, vehicle aerodynamics, gas and steam
turbine testing and power generation industries. Based in North
Walsham in Norfolk, Chell was founded in 1976 and employs 34 staff.
Of the 34 staff members, 30 are either fully qualified engineers or
in training to achieve that status.
For the year ended 31 December 2018 Chell achieved revenues of
GBP4.7m, gross profit of GBP2.5m and profit before tax of GBP0.78m.
Revenues include service revenues calibrating in service Chell
Instrumentation, and instrumentation made by others.
Approximately 76 per cent. of Chell's sales are to the UK with
the balance of 24 per cent. being exported.
Chell's competitive advantages are its calibration laboratory,
deep understanding of its customers' applications and its own
manufacturing facility with industry leading capabilities.
Acquisition rationale
The Acquisition is in line with the Group's strategy of
acquiring complementary businesses and the Board has identified
areas within Chell that have the potential for growth. Chell will
be part of SDI Group's Sensors and Control reporting segment.
Consideration for the Acquisition
Total cash consideration (excluding an additional cash payment
for net assets at completion, expected to be less than GBP1.7m and
such assets expected to include a material element of cash) is
GBP4.3m. SDI has funded the cash consideration from existing cash
resources and bank debt.
The Board also announces that, in agreement with HSBC Bank plc,
it has taken a 3-year amortising term loan of GBP4.8m to add to the
Senior Facility of GBP5m (not fully drawn), with the end date of
both facilities being April 2023. The Group's unaudited net debt
position at 31 October 2019 was GBP0.7m, before adjustment for the
effects of reporting under IFRS 16 (Leases).
The Company expects to report its interim results for the six
months to 31 October 2019 on 17 December 2019.
Enquiries
SDI Group plc 01223 320 480
Ken Ford, Chairman
Mike Creedon, CEO
Jon Abell, CFO
www.scientificdigitalimaging.com
finnCap Ltd 020 7220 0500
Ed Frisby/Kate Washington - Corporate Finance
Andrew Burdis/Sunila de Silva - ECM
JW Communications 07818 430 877
Julia Wilson - Investor & Public Relations
About SDI Group plc:
SDI designs and manufactures scientific and technology products
for use in digital imaging and sensing and control applications
including life sciences, healthcare, astronomy, manufacturing,
precision optics and art conservation. SDI operates through its
company divisions: Atik Cameras, Synoptics, Graticules Optics,
Sentek, Astles Control Systems, Applied Thermal Control, MPB
Industries and Fistreem.
SDI continues to grow by developing its own technology
advancements and by improving its global sales channels, as well as
through pursuing strategic, complementary acquisitions.
No statement in this announcement is intended to be a profit
forecast or estimate and no statement in this announcement should
be interpreted to mean that earnings per share of the Company for
the current or future financial years would necessarily match or
exceed the historical published earnings per share of the
Company.
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
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END
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