For the six months to 30 June overall sales rose from £23.7m to £26.3m, while gross margin increased from 27% to 29%.
However, the loss from continuing operations increased from £967,000 to £1.84m, largely due to issues at the US-headquartered EPS Product Print Systems business, which took a £1m hit against obsolete or slow moving inventories.
Xaar’s 3D business, which is expected to be sold in H2, and has been reclassified as “held for sale” in the results, made a loss of £3.5m on sales of £1.47m due to increased R&D expenses and delays to its beta programme because of Covid restrictions.
Negotiations to divest the operation are at “an advanced stage”.
Xaar CEO John Mills said the business had been dealing with a number of headwinds, including the global shortage of silicon chips, and lockdowns in China impacting Xaar’s OEM customers there, but he remained optimistic about the firm’s future prospects.
“We have a very strong cash position and balance sheet. I’m still pretty confident we will be profitable next year. Overall we’re in good shape,” he stated.
The Cambridge-headquartered inkjet developer acquired FFEI after the period end. Mills said FFEI’s integration know-how would help the firm capitalise on the opportunities which it calls User Developer Integrations (UDIs), such as bespoke systems on production lines.
“We are increasingly seeing companies wanting to use digital printing, or digital deposition of fluids, on their production lines but there is no off-the-shelf machine for them,” he explained.
“These customers like our heads because we can jet fluids that have the special properties they need.”
Mills said Xaar’s ability to jet very high viscosity fluids compared with other printhead manufacturers was a big USP for the business, with potential markets including PCB production.
“There is a lot of pressure from the Chinese government to reduce the pollution currently associated with the PCB industry, and one of the ways to do that is with digital print," he stated.
Earlier this month Graham Tweedale, general manager of Xaar’s printhead business unit, said the firm’s Ultra High Viscosity technology was “opening up new possibilities for Xaar in a number of applications, particularly label and packaging”.
Xaar also launched a new product using its ImagineX platform today.
The compact, lightweight Irix printhead is targeted at a range of applications including coding and marking, functional fluids, product printing and 3D printing.
Xaar’s share price fell by 21.29p, or 9.38%, to 205.71p on the results announcement.
