Final Results

The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.

Tristel plc

("Tristel", the "Company" or the "Group")

Audited Preliminary Results

for the year ended 30 June 2024

Record revenues, 38.5% growth in pre-tax profits and strong cash generation

Tristel plc (AIM: TSTL), the manufacturer of infection prevention products for hospitals, announces its audited preliminary results for the year ended 30 June 2024, with trading ahead of both market expectations and internal performance targets. The Company has delivered record revenues, growth in pre-tax profits and maintained strong cash generation from the operations. It continues to be debt free and at the end of year cash and short-term investments balances were £11.8m including £5.7m held as short-term investments.  

The Company's core business is the sale to hospitals of its proprietary chlorine dioxide chemistry for the decontamination of medical devices under the Tristel brand (87% of total sales), and for the sporicidal disinfection of environmental surfaces under the Cache brand (8% of total sales).

Financial Highlights

* before share-based payments

Operational Highlights

Matt Sassone, Chief Executive of Tristel plc, said: "I am delighted to take on the role as Chief Executive of Tristel and at a stage when we can build on our growing and well-established global footprint for our products and technology. It is clear from my first weeks in the role that we have in place the foundations for further success: we have a hugely talented team, we have differentiated and innovative products that are already well established as market-leading, and we have a host of exciting commercial opportunities to deliver further growth. It is no wonder that as a Board we remain very confident about the outlook for the Company."

CEO video & investor presentations

Please find a link to a video overview relating to the Company's preliminary results from the Group's Chief Executive Officer, Matt Sassone here - https://stream.brrmedia.co.uk/broadcast/670fc1052bd2bbc93fcd920b

Matt Sassone, CEO, and Liz Dixon, CFO, will present the Company's results via the Investor Meet Company platform today at 11:30 BST. The presentation will also be available for playback after the event. Investors can sign up to Investor Meet Company for free and add to meet Tristel plc via: https://www.investormeetcompany.com/tristel-plc/register-investor

An in-person presentation will take place at 16:30 BST, which is open to all existing and potential shareholders. The Company will welcome investors to 85 Gresham Street, London, EC2V 7NQ from 16.15 for a 16.30 start and will be followed by refreshments. If you would like to attend, please contact Walbrook PR on 020 7933 8780 or email [email protected].

The results presentation is available on the Company's website: https://tristelgroup.com/

For further information please contact:

About Tristel plc

Tristel plc is a global infection prevention company focussed on the manufacture and supply of products using its unique proprietary chlorine dioxide (ClO₂) chemistry. The Company is a market leader in manual decontamination of medical devices, supplying hospitals under the Tristel brand, and under the Cache brand provides products for sporicidal surface disinfection, a more sustainable alternative to commonly used pre-wetted plastic wipes.

Tristel's head office and manufacturing facility is located in Snailwell, near Cambridge, and operates globally employing approximately 250 people across 17 active subsidiaries selling into 40 countries. The business is profitable, with no debt, and has a progressive dividend policy.

The Company has been listed on the London Stock Exchange's AIM market since 2005 (AIM: TSTL).

For more information about Tristel's product range please visit: https://tristel.com

Chairman's Statement

Chairman's Statement

The 2024 financial year ("FY 24") has been a record year for Tristel in terms of financial performance, with trading ahead of market expectations and our own performance targets. We delivered record revenues, growth in pre-tax profits and maintained strong cash generation from the operations. We continue to be debt free and at the end of year cash and short-term investment balances were £11.8m.

FY 24 also saw us execute against our geographic expansion plans following the  significant milestone  of FDA clearance for Tristel ULT, our high-level disinfectant ("HLD") for use on endocavity ultrasound probes and skin surface transducers at the end of the previous financial year. In FY 24 we registered our first sales in the US and we continue to work with our partners to increase our market share across North America.

2024 was also a pivotal year in Tristel's history as we position the business for our next stage of growth. After 31 years at the helm, and having built a world-class business, Paul Swinney founder and CEO retired and we welcomed Matt Sassone as his successor.

With over 27 years of experience in the medical device industry, Matt brings a wealth of knowledge and a proven track record of leadership in many markets including North America. His vision and expertise will be instrumental in guiding Tristel through its next phase of growth.

My Board colleagues and I extend our thanks to Paul, who has led the company with remarkable vision and dedication for over three decades. Under his leadership, Tristel has grown from a pioneering start-up to a globally recognized leader in infection prevention, driving innovation by capitalising upon the Company's unique chlorine dioxide chemistry. Paul leaves a legacy of success as shown in this set of results.

Group Strategy

The Group continues to focus on the global hospital market, using its proprietary chlorine dioxide chemistry for two applications: the decontamination of the medical devices under the Tristel brand, and the disinfection of environmental surfaces under the Cache brand.

Our ambition is to become the global market leader in the manual decontamination of heat sensitive non-lumened diagnostic medical devices. In Europe, the Middle East and APAC we already hold this position, and during the year we started to build commercial momentum in North America, following the receipt of De Novo clearance for our hand-held HLD, Tristel ULT, from the United States Food and Drug Administration (FDA). This was a significant milestone for a British company of our size.

During the year, 39% of Group revenue was generated in the United Kingdom and 61% in the rest of the world. Throughout the 61 countries in which we actively market our products, Tristel medical device disinfectant revenue, which is driven by the number of diagnostic procedures in which our products are used, increased to £36.3m from £30.8m in the previous year.

Our second product range, Cache, made slower progress during the year. Revenue was £3.4m compared to £3.3m in the previous year. As announced in February, the Company gained Medical Devices Regulation 2002 ("UK MDR") and the European Union Medical Device Regulation 2017/745 ("EU MDR") approval of its TANK ClO₂ Sporicidal Disinfectant system. These newest additions to the Cache range, which provides sporicidal surface disinfection in a format which is a sustainable alternative to commonly used pre-wetted plastic wipes, and our continued success in gaining regulatory approvals in key markets, give us confidence that the Cache range will deliver significant sales growth going forward.

Investing in Growth

We are committed to ensuring that our business is fully primed for growth, both in the UK and across our international subsidiaries. As we expand our global reach, we continue to invest in our people and strengthen our systems to support both our commercial and operational functions. Over the past year we have grown our headcount by 6%, enhancing our sales, marketing and technical teams to meet the demands of our highly regulated industry.

In parallel, we are driving a comprehensive digital transformation across the organization, ensuring that our systems and processes are optimised for the future. Our continued investment in IT and cybersecurity infrastructure is crucial to maintaining the resilience of the business as it grows. By expanding these capabilities, we are positioning Tristel to seize new opportunities, scale efficiently, and sustain our leadership in infection prevention.

New product development is a key focus for the Board and we continued to invest during the year in three areas:

We made six patent applications during the year and three applications went to grant. During the year we invested £0.9m in product development and £0.5m in securing and maintaining intellectual property protection.

North America

In June 2023 we reached a significant milestone by securing FDA clearance for Tristel ULT, our ultrasound HLD. In the first half of FY 2024, our partner Parker Laboratories Inc. began manufacturing and commercialising the product in North America. In the second half, Parker's distribution network had stocked up on inventory, and in the final quarter, we started onboarding an increasing number of users.

Tristel ULT is complementary to Parker labs' market leading Aquasonic gel, in that for every invasive ultrasound procedure the gel must be used and an HLD must be used. Parker is a well-qualified manufacturing partner, for Tristel ULT, providing the highest quality standards in its FDA approved New Jersey facility, and also selling our product through its existing nationwide distribution channels. To support our partnership, Parker has expanded its own direct sales team from two people to 10. Whilst Parker have encountered more purchasing bureaucracy than we originally anticipated, which has slightly extended the timeline for some adopters to come on board, momentum is growing as we make headway in the world's largest market.

Parker has also showcased our products at various conferences across North America. Culminating in the publication in May of a white paper "Simplifying High-Level Disinfection for Urological Procedures: A Case Study" at the American Urological Association 2024 conference, the largest gathering of urologists in the world. In the paper, US urologist, Dr Matthew Allaway, highlights Tristel ULT in a case study, commenting on the product's ability to enable faster, simpler endo-cavitary probe processing for busy urology practices.

The white paper can be seen here:

https://www.parkerlabs.com/wp-content/uploads/2024/04/AllawayWhitePaper_8_LOCKED.pdf

In January 2024, we gained Health Canada approval for Tristel ULT, further extending our reach.

Our people

It's clear that our people are Tristel's greatest asset. Without their dedication, skill, and expertise, none of the successes we have achieved would have been possible. We recognise this and are committed to being the best employer we can be, ensuring that Tristel is a place where talent can thrive and grow.

Their collective efforts have not only elevated our reputation but have also positioned us for even greater success.

Results

Total revenues increased 16% to £41.9m for the year (2023: £36.0m). Our gross profit margin increased by 2%. Overheads (excluding share-based payments, depreciation, amortisation and impairment) rose by 19%, principally due to the increase in average headcount to 238 (2023 212). Increases in wages and salaries for the Group were £2.2m.

Adjusted pre-tax profit (before share-based payments of £1.1m) rose 32% from £6.2m to £8.2m. Statutory pre-tax profit increased to £7.1m from £5.1m and the statutory margin rose to 17% from 14%. Charges associated with share-based payments have been included as adjusting items. Although share-based compensation is an important aspect of the compensation of our employees and executives, management believes it is useful to exclude share-based compensation expenses from adjusted profit measures to better understand the long-term performance of the underlying business.

Earnings per share (EPS) (adjusted for the add-back of the share-based payment charge) was 15.34 pence (2023: 10.67 pence). Basic EPS was 13.68 pence (2023: 9.44 pence) and diluted EPS was 13.54 pence (2023: 9.34 pence).

Balance Sheet, Cash and Dividend

The Group has continued to be highly cash generative at an operating cash flow level during the year and the balance sheet is debt free (with the exception of lease liabilities). The combined cash and short-term deposit balance at 30 June 2024 was £11.8m (2023: £9.5m), with £5.7m classed as short term investment (2023: £2.4m).

The Board is recommending a final dividend of 8.28 pence (2023: 7.88 pence). Combined with the interim dividend of 5.24 pence, the total dividend pay-out for the year will be 13.52 pence per share, this is an increase of 29% on last year's total dividend pay-out of 10.50 pence. Going forward the Board's intention is to increase the dividend annually in line with the year's increase in EPS, committing to minimum dividend growth of 5%. This final dividend will be paid on 20 December 2024, to shareholders on the register on 29 November 2024, the associated ex-dividend date is 28 November 2024.

Outlook

Our results clearly reflect our dominant market leadership position. Demand for our infection prevention products remains robust across all of our geographical markets, and with our recently established foothold in North America, we believe we can continue to deliver sustainable growth.

Dr Bruno Holthof

Non-Executive Chair

Chief Executive's Report

Overview

I am delighted to have joined Tristel. Having admired the business from afar, I now have the privilege of being part of a team that continues to deliver exceptional results, as reflected in our strong performance across all product categories this year. Tristel's success is built on the solid foundation established by my predecessor, Paul Swinney, and my focus will be on building upon that legacy.

We will continue to seize global opportunities, particularly with our core medical device disinfection products, and expand our footprint in key markets like North America. At the same time, we remain committed to delivering on our strategic intent to enter the surface disinfection market, where we see significant potential for our proprietary chlorine dioxide chemistry to disrupt this much larger sector.

The year ended 30 June 2024 marked another period of robust growth for the Group, with notable progress in our key strategic initiatives. These included the expansion of our medical device portfolio into critical new markets like the USA and advancing our goal to penetrate the surface disinfection market.

In the USA, our partner Parker Laboratories began manufacturing and commercialising Tristel ULT during the year, gaining significant traction with several hospitals onboarded in the final quarter. They have built a strong pipeline of opportunities but acknowledge that the more stringent post-COVID purchasing bureaucracy is extending the sales process longer than initially anticipated.

Additionally, we successfully completed the UK MDR and EU MDR certifications for our TANK ClO₂ Sporicidal Disinfectant system. This sustainable alternative to pre-wetted plastic wipes, launched at the end of the fiscal year, is expected to drive accelerated growth in Cache sales across Europe and other regions that recognize these high regulatory standards.

Financial targets

The Board and I remain committed to our financial plan for the three years to 30 June 2025, which was a continuation of the plan for the prior three-year period ending in June 2022. The three key financial targets of both the old and new plans are:

Having joined the business just a few weeks ago, I ask for a little time to work closely with stakeholders to review the company's strategic direction. This process will ensure that we are well-positioned for the next phase of our growth journey. I look forward to updating investors on our financial targets beyond June 2025, as we define our goals to align with the growing opportunities in our core markets and new areas of expansion.

Our marketplace and technology

Our business is entirely dedicated to preventing the spread of microbes from one person or object to another. This is critical as the spread of the cross contamination of microbes are responsible for infections in healthcare, leading to illness, death, and imposing a heavy burden on both individuals and society. We fulfil this mission by developing products based on chlorine dioxide, a powerful disinfectant that we've uniquely formulated.

Hospitals, where infection risks are the highest, are where our solutions have the most impact. Infection prevention is a fundamental necessity for the safe and effective delivery of healthcare worldwide. Over 98% of our revenue comes from consumable products that perform essential, non-discretionary functions in these settings.

Our strategy revolves around our proprietary chlorine dioxide chemistry, applied in two key areas. First, we focus on the high-level disinfection of medical devices under the Tristel brand, which accounted for 87% of our continuing product revenues this year. Second, we address the disinfection of hospital surfaces through our Cache brand, representing 8% of revenues. In this area, we distinguish between the sporicidal efficacy of our chlorine dioxide chemistry and the lower-level performance claims of most competing disinfectants. Our aim is to lead the global market in this high-performance, sporicidal segment.

Tristel stands out in two key ways. We are the only provider of chlorine dioxide-based high-level disinfectants that are both validated and regulated for use with semi-critical medical devices. Moreover, our disinfectants are applied manually, unlike our semi-automated competitors that rely on a process of manually cleaning followed by a machine that applies UV-C light or a hydrogen peroxide mist.

While surface disinfection is a universal need in hospitals, with expenditures on it far exceeding those for medical device decontamination, it's the ability to kill bacterial spores that sets the top biocides apart. Chlorine dioxide, as one of the few chemistries capable of this, is a cornerstone of our offering.

The manual application of our products makes them ideally suited for departments handling small, heat-sensitive medical instruments. Whether it's nasendoscopes in ENT departments, laryngoscope blades in emergency settings, cardiac echo probes for heart disease diagnosis, or ultrasound probes in women's and men's health, Tristel provides the simplest, fastest, and most cost-effective high-performance disinfection. As a result, in the markets where we've established ourselves, we hold substantial market share.

Revenue

We segment our business to reflect our corporate strategy and geographical spread. We have developed distinctly different brands for the two product categories: Tristel for medical device disinfection and Cache for sporicidal surface disinfection. Our strategic intention is to develop the Tristel and Cache brands and product portfolios with a significant degree of independence from each other, but both anchored upon our chlorine dioxide technology platform and using the same sales teams in all countries.

Higher sales volume accounted for £2.2m of the £5.9m revenue growth and price increases accounted for the remaining £3.7m. This represents an average price increase of 11%, driven primarily by the UK where the increase has been higher because of supply agreements which require fixed pricing extending into future years.

Tristel medical device sales grew by 18%, reaching £36.4m. Reinforcing our ability to continually grow on our market leadership position.

During the year, the revenue split across these product categories was:

Revenue by channel

We sell our products directly to end-users in those markets in which we have established a subsidiary, and through distributors in markets where we have no corporate presence. During the year, the revenue split by sales channel was:

Revenue by geography

Strong sales in the UK saw the sales percentage increase to 39% of total revenues. The below table shows the 5 year history of this metric.

*Sales made to international distributors are included within overseas in the above table to align with the location of the end customer. As these sales originate within the UK subsidiary, for segmental reporting purposes they are included within the UK.

We have 16 subsidiaries selling directly into the hospital marketplace in the United Kingdom, Belgium, the Netherlands, France, Italy, Germany, Switzerland, Poland, Hong Kong, China, Malaysia, Singapore, Australia, and New Zealand, India and United States. We have subsidiaries in Japan, Spain and Ireland which are not yet active in terms of selling. We closed our Russian subsidiary early in FY22.

During the year, in another 45 countries, we sold products through national distributors.

Geographic expansion is a key growth driver for the business, our regulatory programme succeeded in attaining 26 approvals for 17 products in seven countries during the year. Including the approval for Tristel ULT from Health Canada.

Our Strategic Assets

We consider the assets that enable the Group to achieve its strategic goals to be:

Our chlorine dioxide chemistry

There are three critically important elements that account for the unique positioning of our chlorine dioxide chemistry:

1.     The proprietary formulation,

2.     Our focus over two decades on exploring the potential for chlorine dioxide in the decontamination of medical instruments. There is another application for chlorine dioxide chemistry which all other businesses have concentrated upon which is water treatment. From the inception of our business in the 1990's we looked in a different direction - towards medical device disinfection - a direction which others have not followed, and this has given us the pioneer's advantage,

3.     The length of time that we have enjoyed this pioneer position has allowed us to collate a significant body of knowledge, including published scientific data, the testimony of almost two decades of safe use, a significant global footprint of regulatory approvals and a library of proven compatibility with hundreds of medical instruments, all of which would take a new entrant significant time and cost to match.

Intellectual property protection

On 30 June 2024, we held 149 patents granted in 32 countries providing legal protection for our products.

In its broadest sense, our intellectual property relates to:

1.     Patents, trademarks and registered designs,

2.     The scientific validation of our chemistry and our products that have entered the public domain, via a number of peer-reviewed and published papers,

3.     The certification by medical device manufacturers that our chemistry is compatible with their products. We enjoy official compatibility with the instrumentation of 56 medical device manufacturer, with respect to 1,449 of their individual models.

Our people possess an unrivalled body of knowledge relating both to infection prevention and to chlorine dioxide, and they are a key asset for the future of our business. Their domain knowledge relates to the manufacture of chlorine dioxide-based products and their development. The Company's R&D investment focusses exclusively on our proprietary technology, searching for improvements in microbial efficacy, reductions in hazards, and greater efficiency in manufacture. In parallel, we invest in the creation of packaging and delivery forms that enhance and simplify the delivery of the chemistry and the user experience.

Outlook

This year has been all about delivering on the solid foundations that have been put in place across the business to support growth.

The main driver of our growth has been our Tristel branded products for medical device disinfection, which have benefitted from a continued rise in sales volumes, but also from increased pricing, primarily from the UK due to an increase in longer term fixed price supply agreements. We expect to see further growth across all of our markets in FY 25, and we are particularly focussed on making the most of the significant opportunity that last year's FDA approval for Tristel ULT presents : access to the largest healthcare market in the world. This also gives us the opportunity to leverage the significance of an FDA approval in countries that look to the USA regulator for their own practice, such as countries across Central and South America. We also expect to see future growth from the successful execution of our North American strategy for Tristel OPH, with sales already building up in Canada, and FDA 510(k) clearance targeted for the end of this calendar year.

On the surfaces side, we believe that following UK MDR and EU MDR certifications for our TANK ClO₂ Sporicidal Disinfectant system, we will be able to accelerate growth in Cache sales across Europe and other regions that recognised these high regulatory standards. Sales of these products, for environmental surface disinfection in hospitals, are starting from a low-base, but we believe our offering, that provides the highest level of surface disinfection whilst eliminating the need for the single-use throw-away plastic wipes, will be both commercially and environmentally attractive.

I am delighted to take on the role as Chief Executive of Tristel and at a stage when we can build on our growing and well-established global footprint for our products and technology. It is clear from my first weeks in the role that we have in place the foundations for further success: we have a hugely talented team, we have differentiated and innovative products that are already well established as market-leading, and we have a host of exciting commercial opportunities to deliver further growth. It is no wonder that as a Board we remain very confident about the outlook for the Company.

Matt Sassone

Chief Executive Officer

Tristel Plc

Consolidated Income Statement for the Year Ended 30 June 2024

The above results were derived from continuing operations.

The prior year has been restated to align to IAS 2 in relation to classification of expenditure included in cost of sales, the restatement has no effect on the Profit for the year and is fully disclosed in Note 8

Tristel Plc

Consolidated Statement of Comprehensive Income for the Year Ended 30 June 2024

Tristel Plc

(Registration number: 04728199)

 Consolidated Statement of Financial Position as at 30 June 2024