BATM Full Year Results 2021

28 February 2022

 BATM Advanced Communications Limited
(“BATM” or “the Group”)

Download Complete Full Year Results 2021

Full Year Results 2021

Transformational year with significant financial and operational delivery

BATM (LSE: BVC; TASE: BVC), a leading provider of real-time technologies for networking solutions and medical laboratory systems, announces its preliminary results for the year ended 31 December 2021.

Financial Summary

* Adjusted to present the results on an ongoing operations basis by excluding (1) the contribution to both years from NGSoft, a subsidiary that the Group sold in March 2021, (2) the contribution to 2020 from a significant contract for the supply of ventilators, which was exceptional in nature, and (3) the amortisation of intangible assets for both years. The term ‘ongoing operations’ in this announcement is used for comparative purposes only and is not used in the same context as in accounting standards. For further information see Note 3 – Other alternative measures.

Operational Summary

Bio-Medical Division (84% of total revenue from ongoing operations)

• Revenue from ongoing operations (excluding the contribution to 2020 from an exceptional ventilator contract) increased by 17.7% to $112.0m (2020: $95.2m), reflecting growth in all units
• Diagnostics Unit – revenue +38%
  • Significant sales growth driven by strong global demand for COVID-19 test kits (reagents) and diagnostic instruments and supported by increased sales of products in other disease areas
  • Expanded COVID-19 diagnostics portfolio with launch of new solutions, including a test that uses self-collected saliva samples and the RAPiDgen® SARS-CoV-2 Ag test for at-home use
  • PCR and iso-thermal method being developed by the Group for the rapid and comprehensive diagnosis of tuberculosis received the backing of the Stop TB Partnership, an international alliance
• Eco-Med Unit – revenue +37% (excl. contribution from exceptional ventilator contract)
  • Returned to underlying growth with delivery resuming on contracts for the installation of the Group’s ISS-based pathogenic waste treatment solution
  • Progress made in projects with Ceva Animal Health and a Taiwanese agri-food conglomerate
  • Awarded a contract for its agri-waste treatment solution by a cattle facility in Botswana – the Group’s first contract for its agri-waste solution in Africa
• Distribution Unit – revenue +9%
  • Increased revenue driven by the distribution of several molecular tests and of COVID-19 diagnostic reagents and equipment

Networking and Cyber Division (16% of total revenue from ongoing operations)

• Revenue from ongoing operations (which excludes the contribution from NGSoft to both years) increased by 19.5% to $20.7m (2020: $17.3m), reflecting underlying growth in both the Networking and Cyber units
• Networking Unit – revenue +13% (excl. contribution from NGSoft)
  • Launched Edgility, an ecosystem of networking products and services for edge computing based on the Group’s network function virtualisation (“NFV”) technology
    • Won two edge computing contracts expected to be worth an aggregate of $2.7m over a multi-year period, which commenced generating revenue post year end
    • Successful proof-of-concepts conducted with several potential customers and partners worldwide, which the Group expects will translate to orders in 2022
    • Established four new partnerships, including one post period, to boost Edgility sales and market presence through the offering of joint solutions
    • Expanded addressable market with enhancement of Edgility OS to enable use for public cloud environments
  • Network Edge (Carrier Ethernet)
    • Resumption of normal business practices resulted in an increase in revenue during the year and a substantial increase in backlog, which is for delivery in 2022
    • Awarded a contract from a new tier 1 telecommunications operator customer in APAC, which contributed significantly to the unit’s growth
  • Cyber Unit – revenue +111%
    • Awarded over $18m in cyber security contracts from a long-standing government defence department customer
    • Delivery of these orders commenced during the year and will continue in 2022 and 2023
    • The contracts include a $10m multi-year contract for the delivery of an advanced network security solution containing elements of NFV protection

Commenting on the results, Dr Zvi Marom, Chief Executive Officer of BATM, said: “We are delighted to be announcing another excellent set of results with growth from ongoing operations in all of our business units. We are particularly proud of the significant progress made in our Diagnostics unit, where our investment in recent years has really come to fruition, and of the substantial contracts awarded during the year in our cyber business. We were also excited to launch our Edgility platform for edge computing and virtual networking, which we believe will be a key driver of our future growth.

“Looking ahead, we entered the new year with sustained momentum across the business and we remain on track to deliver significant growth for full year 2022, in line with market expectations. We have established solid foundations in core technologies that are now at an inflexion point of becoming market disrupters. We will continue to cultivate growth and development across our business as well as pursue opportunities to accelerate the realisation of the value of the IP within our different units through strategic transactions. We have an exciting future ahead of us and we look forward to reporting on our progress and delivering value for our shareholders.”

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

Investor & Analyst Presentations

Dr Zvi Marom, Chief Executive Officer, and Moti Nagar, Chief Financial Officer, will be holding presentations for analysts and investors today, 28 February 2022, at 9.00am GMT and 5.30pm GMT respectively. To register to attend, please contact Lara Apstein at Luther Pendragon at laraapstein@luther.co.uk

Forward-looking statements

This document contains forward-looking statements. Those statements reflect the current opinions, evaluations and estimations of the Group's management, and are based on the current data regarding the Group's business as is detailed in this document and in the Group's periodical, interim and immediate reports. The Group does not undertake any obligation or make any representation that actual results and events will be in line with those statements, and stresses that they may differ materially from those statements, due to changes in the Group's business, market, competition, demand for the Group's products or services, general economic factors or other factors that can influence the Group's business and results, and due to information and factors that are currently unknown to the Group's management and that, if known, would affect the management's opinions, evaluations or estimations. The Group will report the actual results and events according to its legal, accounting and regulatory obligations, and does not undertake any other obligation to report them or their deviations from the forward-looking statements, or to update any of the forward-looking statements in this document or to report that it is not valid anymore.