HeiQ (HEIQ) Trading Update summary

Financial performance and market conditions

• Revenue for the 18-month period ending June 2024 expected at $62 million, up from $47 million in the prior 12-month period.

• Sales volumes remained stable, but sales prices were lower due to challenging market conditions and high input costs.

• Operating loss for the period expected at $18 million, an improvement from $29 million in the previous year.

• Cash balance as of June 30, 2024, was $4.9 million, with net debt (excluding leasing) at $6.6 million.

• Liquidity remains strained, with further funding required to support growth and ventures.

Business unit and venture performance

• Textiles & Flooring contributed $46 million to group revenues, but demand remains weak due to macroeconomic pressures.

• Antimicrobials business contributed $4 million, also affected by subdued demand.

• Life Sciences unit achieved large contract wins and signed an exclusive EU distribution agreement, with new contracts expected to drive growth from Q4 2024.

• Venture units AeoniQ, Xpectra, and GrapheneX made progress in product development, partnerships, and facility expansion.

• Third-party investment is being sought for venture units to accelerate growth.

Strategic actions and outlook

• Cost reduction measures implemented, including capability relocation and business unit synergies.

• Additional cost reductions and refinancing of assets are under consideration to stabilize operations.

• Board does not expect short-term improvement in established businesses, except Life Sciences.

• Strategic options for individual units, including mergers, sales, or carve-outs, are being reviewed.

• Banco Santander engaged to lead a capital raise at the subsidiary level by H1 2025 to fund the AeoniQ plant.