| Investor Relations |
| CHAIRMAN'S STATEMENT | March 2002 |
| Your company made significant progress during the six months to December 2001 with all planned milestones being met. The company's product range has been widened and PipeHawk has become the predominant GPR brand in the UK. | |
| External Development Projects | |
| A highlight of the first half of the year was the award by NYGAS
of a contract to develop a lightweight portable radar device. This
is now underway and is on schedule. Early technical progress is very
encouraging and will, we believe, lead to the successful introduction
of a product with varying applications for use within the worldwide
construction and utility markets. Early expressions of interest have
been received from companies interested in distribution and Original
Equipment Manufacturing arrangements. These expressions of interest
are in addition to the US Corporation that has been assisting with
the programme to date.
LOTUS is now one of only two vehicle mounted landmine detection
projects remaining in the EU programme. It has recently successfully
passed a full technical review and UK field trials are now taking
place. These trials utilise inert dummy mines to test the system's
detection accuracy and are an essential step prior to a demonstration
scheduled to be held in Bosnia in August this year. |
|
| Internal Product Development | |
| The company has now completed a new version of its
core PipeHawk product designed to the specific requirements of its
joint venture
franchise company, SUMO Services Ltd, which now has two pilot franchises
operating. The development cost of this project was £120,000,
which has been charged to the Profit and Loss Account.
The further development of the PipeHawk product range has continued
with a model to measure the thickness of asphalt layers in repaired
roads and pathways (Electronic Core Sampling). This new product development
has only been possible because of the technical advances achieved
within the landmine project. The programme is on schedule with field
Beta testing now underway, prior to a major product launch scheduled
for early summer. The development costs associated with this programme in the first half are £146,000, which have been charged to the Profit and Loss Account. |
|
| Product Sales | |
| PipeHawk sales and prospects were encouraging at the
beginning of the period but were disappointing overall. Despite a
significant commitment
to advertising and marketing (£47,000), sales enquiries and orders
reduced in the last three months as companies stopped or deferred their
capital spending programmes. This unexpected shortfall in orders resulted
in the sales revenue being £270,000 below forecast - equivalent
to nine unit sales.
However, since the beginning of January sales have increased, with orders received from China, Korea and the UK - in particular a further two orders from UKAEA. |
|
| Loan Repayments | |
| The two loan accounts of £145,704 and £300,000 which fall due for repayment in August 2002 are, in the opinion of the Board, capable of being renewed or replaced to the extent then required by the company. | |
| Future Prospects | |
| A major benefit of joining AIM has been the enhanced public profile
of your company and the Board is now able to consider broadening the
company's range of activities so as to establish a service based activity
specialising in non-invasive leading edge technologies complimentary
to its core radar business. Positive preliminary discussions have been
held with a number of companies key to this strategy and initial indications
of support from potential providers of finance have been obtained.
Having completed the major part of our development programme we have been able to reduce costs going forward and this coupled with expected higher product sales, leads the Board to be confident that the second half of the current year will show a much improved trading position. |
|
| David Mahony Chairman 27 March 2002 |
Back to Investor Relations 2002 |
