Interim Report • Aug 26, 2024
Interim Report
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| 1. | Basic Informa5on about the Company, Its Ac5vi5es and the Consolidated Accoun5ng Unit 4 |
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| 2. | Descrip5on of Important Events in the First Half of 2024 5 |
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| 3. | Descrip5on of Related Party Transac5ons in the First Half of 2024 8 |
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| 4. | Impact of the Russian Invasion to Ukraine 9 |
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| 5. | Descrip5on of Expected Ac5vity and Main Risks and Uncertain5es for the Second Half of 2024 10 |
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| 6. | Other Details 12 |
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| 7. | Condensed Consolidated Interim Financial Statements as of 30 June 2024 13 |
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| Consolidated Statement of Comprehensive Income for the Half Year Ended 30 June 2024 14 |
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| Consolidated Statement of Financial Position as of 30 June 2024 15 |
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| Consolidated Statement of Changes in Equity for the Half Year ended 30 June 2024 16 |
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| Consolidated Statement of Cash Flows for the Half Year Ended 30 June 202417 | ||
| Notes to the Consolidated Financial Statements18 | ||
| 1. | Company Informa.on18 | |
| 2. | Accoun.ng Principles 18 |
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| 3. | Consolida.on Principles19 | |
| 4. | First IFRS Applica.on 20 |
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| 5. | Significant Accoun.ng Policies 20 |
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| 6. | Significant Accoun.ng Judgements, Es.mates and Assump.ons29 | |
| 7. | Group Informa.on 30 |
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| 8. | Segment Informa.on31 | |
| 9. | Revenue from Contracts with Customers 31 |
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| 10. | Intangible Fixed Assets32 | |
| 11. | Land, Buildings and Equipment33 | |
| 12. | Lease34 | |
| 13. | Inventories35 | |
| 14. | Trade and Other Receivables35 | |
| 15. | Cash and Cash Equivalents35 | |
| 16. | Trade and Other Payables36 | |
| 17. | Provisions 36 |
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| 18. | Income Tax 37 |
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| 19. | Equity38 |
| 20. | Staff Costs38 | ||
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| 21. | Financial Risk Management38 | ||
| 22. | Capital Management40 | ||
| 23. | Related Party Disclosures41 | ||
| 24. | Subsequent Events 41 |
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| 8. | Declara5on of Responsible Persons |
42 |
Primoco UAV SE, with the seat at Výpadová 1563/29f, Post Code: 153 00, Praha 5 - RadoFn, ID No.: 037 94 393, registered in the Commercial Register maintained by the Municipal Court in Prague, SecTon H, Insert 1546 (hereinaWer referred to as "Company"), whose shares (ISIN CZ0005135970) are admiZed to trading on the regulated market Prime Market, which is a part of the regulated market organized by Burza cenných papírů Praha (Prague Stock Exchange), a.s., with the registered office at Rybná 14/682, Postal Code: 110 00, Prague 1, ID No.: 471 15 629, registered in the Commercial Register maintained by the Municipal Court in Prague, SecTon B, Insert 1773, is a leading European manufacturer of medium-sized fully autonomous One 150 unmanned aerial vehicles and a provider of related aviaTon services.
The Company is the first operator in the world to receive a civil operaTng authorisaTon EASA LUC (Light Unmanned CerTficate) for a fixed wing aircraW weighing 150 kg. The aircraW is also in the final stages of the military cerTficaTon process NATO STANAG 4703. The Company is an approved military aerospace Development and ProducTon OrganizaTon (DOA/POA) under the EMAR 21 standard.
To date, the Company has produced more than 170 UAVs One 150, which are operated on four conTnents to monitor strategic infrastructure, protect borders and coastlines, calibrate airport guidance systems, and other military and civilian missions. One 150 UAVs are classified as dual-use products or military equipment. UAVs carry no weapons systems.
In addiTon to the Company, the consolidated accounTng unit of the Company consists of Primoco UAV Defence, s.r.o., with its registered seat at Výpadová 1563/29f, Post Code: 153 00, Prague 5 - RadoFn, ID No.: 081 05 111, registered in the Commercial Register maintained by the Municipal Court in Prague, SecTon C, Insert 313076, in which the Company has a 100% share. The economic indicators in Part 2 of this Report are always presented for the whole consolidated accounTng unit.
Primoco UAV SE increased sales by more than 80% year-on-year to CZK 331 million in the first half of 2024. The Company has again significantly improved other key indicators of its business, including EBITDA, which increased by nearly 130% to CZK 156 million compared to the same period.
| 30/6/2024 | 30/6/2023 | |
|---|---|---|
| Earnings a/er Taxes (EAT) | 121,196 | 66,843 |
| Tax prepayments | 32,200 | 0 |
| Tax prepayments extraordinary | 0 | 0 |
| Earnings before Tax (EBT) | 153,396 | 66,843 |
| Cost interest | 0 | 0 |
| Earnings before Interest and Taxes (EBIT) | 153,396 | 66,843 |
| DepreciaNon | 3,275 | 1,892 |
| Earnings before Interest, Taxes, DepreciaEon | ||
| and AmorEsaEon (EBITDA) | 156,671 | 68,735 |
| Revenue - operaNon | 331,293 | 183,480 |
| Costs - operaNon | -182,262 | -125,673 |
| OperaEng profit/loss | 149,031 | 57,807 |
| Revenues | 336,340 | 194,604 |
| Cost | -215,144 | -127,761 |
| Financial Results | 121,196 | 66,843 |
The significant year-on-year increase in sales and profit reflects the conTnued growth in demand from the defence and civilian sectors for high-end unmanned systems. At the same Tme, it also reflects Primoco UAV's long-term proacTve approach to invesTng in innovaTve technologies, manufacturing capabiliTes and global business relaTonships. This enables the Company to respond quickly and flexibly to individual customer needs and further consolidate its posiTon among the global leaders in the category of mid-size drone manufacturers and full-service aviaTon service providers.
The key milestones of this year's first half include the signature of the largest single Primoco UAV order in history. It includes the order of 24 Primoco One 150 aircraW for a total of EUR 18 million (CZK 450 million) to be delivered to the customer later this year. Speed of delivery is one of Primoco UAV's significant compeTTve advantages, alongside the superior quality of the aircraW and related technologies.
Another significant event in the first half of 2024 was the addiTon of one of Primoco UAV's long-Tme business partners to the Company's shareholder structure. PLATH CorporaTon GmbH, German technology Group, which specialises in the use of data for crisis prevenTon and supplies for the defence and security industries, has acquired a 3% stake in the Company. Taking the mutual co-operaTon to an even higher level is an expression of PLATH Group's strong confidence in the conTnuaTon of the Primoco UAV success story and in the further growth of global demand for unmanned systems.
Primoco UAV achieved sales of CZK 331 million in the first half of 2024. This represents a year-on-year increase of more than 80%. It is also the highest half-year turnover in the Company's history. EBITDA increased to CZK 156 million in the first six months of the year (+128% year-on-year). The Company also managed to increase its operaTng margin to a highly superior 46%. The Company achieved this without drawing down any subsidies or loans. At the same Tme, the amount of free cash in the Company's accounts is growing. As of today (26 August 2024) it amounts to CZK 261 million. The available funds will be used in the coming years mainly to finance investments in a new producTon, training and service centre in Písek.
Primoco UAV has entered into new contracts for the delivery of a total of 26 unmanned aircraW in the first half of 2024. The previously announced outlook, according to which the Company will win new orders for 50-60 machines with a total value of around CZK 1 billion, is being fulfilled. For comparison, last year, Primoco UAV customers ordered 33 UAVs for the full year.
The increase in demand for Primoco UAV systems is not only due to the current geopoliTcal situaTon in the world, where governments and security forces in many countries are increasingly aware of the important role of unmanned aircraW in securing and strengthening their own defence, but also the growing use of UAVs in the civilian sector. An example is the new contract for the delivery of two Primoco UAVs to an Asian customer concluded this June. In this case, the fully equipped One 150 machines will perform missions in the area of inspecTon, calibraTon and evaluaTon of airport navigaTon equipment.
In the area of cerTficaTon, one of the most important steps towards the compleTon of cerTficaTon according to the internaTonally valid NATO standard STANAG 4703 was achieved in the first half of this year. The Primoco UAV One 150M is the world's first UAV to pass strength tests demonstraTng its durability and structural operaTonal safety. Only manned aircraW have undergone similar full-scale tesTng. The Primoco UAV has thus conTnued the cerTficaTon process following the expert verificaTon of the engine characterisTcs that the aircraW successfully passed at the end of last year.
CerTficaTon according to STANAG 4703 when completed will be evidenced by the issue of an aircraW type cerTficate. The cerTficate will allow the aircraW to be exported to any NATO member country without the need to conduct type tests for each market separately. Primoco UAV will thus be the first manufacturer in the world to provide customers in the unmanned segment with a level of cerTficaTon that they have been accustomed to so far only in the area of purchase of manned aircraW.
Other innovaTons in the first half of this year include tesTng the use of Primoco UAVs to provide mobile signal coverage in crisis situaTons. In cooperaTon with T-Mobile, the possibility of integraTng the BTS base staTon of the LTE mobile network into the One 150 machine and the funcTonality of the whole concept were verified. In the event of fires, floods, tornadoes or other natural disasters, UAVs can significantly reduce the Tme needed to restore mobile signal in the affected area and replace ground BTS staTons unTl they are repaired.
Primoco UAV conTnues its acTviTes aimed at a major expansion of its own capabiliTes in the form of the construcTon of a new producTon, service and training centre. At present, the Company has signed purchase contracts in relaTon to all the necessary land in the Písek - Krašovice locality. Moreover, on 15 August 2024, the City Council of Písek approved the sale of land in the industrial zone of Písek to Primoco UAV. In parallel, the preparaTon of project documentaTon and all documents necessary for the applicaTon for a building permit is underway. As of 26 August 2024, Primoco UAV has already invested CZK 125 million in the preparaTon of the construcTon of the new faciliTes, exclusively from its own resources. The amount includes the purchase of land with a total area of 303,000 square metres. The project, when completed in 2027, will allow the producTon capacity to be increased from the current approximately 100 UAVs per year to up to 250 UAVs per year.
In connecTon with the entry of PLATH CorporaTon GmbH into the Company's shareholding structure, minor changes were made in the structure of the major shareholders. The majority owner of the Company remains its founder and CEO Ladislav Semetkovský. Its share as of 16 August 2024 was 50.40%. Gabriel Fülöpp remains the second largest shareholder with a 24.51% stake. CONSEQ Investment Group ranked third in terms of shareholdings with a share of 5.57%. Then PLATH CorporaTon GmbH with a 3.01 % share. Jakub FojFk and Josef Štastný are also among the Company's shareholders. Free float (shares freely traded on the Prague Stock Exchange) was 25.09%.
Finally, please allow me to thank all employees, suppliers, customers, business partners and last but not least you, our shareholders and investors, for their support. The Company's success, its record results in the first half of 2024 and the dynamic year-onyear growth of its key indicators reflect a story to which each of you has contributed. I look forward to conTnuing to grow the Company together.
Best regards,
Ladislav Semetkovský Chairman of the Board of Directors
The related parTes of the Company are Mr. Ladislav Semetkovsky, Mr. Gabriel Fülöpp, as shareholders of the Company, members of the Company's Board of Directors (3 persons), members of the Company's Supervisory Board (3 persons), other members of the Company's senior management (3 persons) and the wholly owned subsidiary Primoco UAV Defence, s.r.o., with registered office at Výpadová 1563/29f, Post Code: 153 00, Prague 5 - RadoFn, ID No.: 081 05 111, registered in the Commercial Register maintained by the Municipal Court in Prague, SecTon C, Insert 313076.
All sales of UAVs manufactured by the Company to end customers are made through its subsidiary, Primoco UAV Defence, s.r.o., under a framework agreement. Within this framework, transacTons in the form of sales of goods and services in the amount of CZK 297,677 thousand were made between the Company and Primoco UAV Defence, s.r.o. in the first half of 2024.
In addiTon, there were no related party transacTons during the period that materially affected or could materially affect the results of operaTons of the Company.
For the first half of 2024, the Company provided remuneraTon and salaries of CZK 3,813 thousand to its members of the Board of Directors, Supervisory Board and senior management. Beyond that, the Company did not provide any other cash or non-cash benefits to these individuals during the period.
There were no other transacTons between the Company and related parTes during the period.
All of these related party transacTons were at arm's length.
Neither the Company nor its subsidiary Primoco UAV Defence, s.r.o. maintain direct business relaTons with Ukraine, Russia or Belarus. No manufacturing faciliTes or other assets of the Company are located in these countries, nor are any of the Company's direct suppliers or customers located there. The Russian invasion did not disrupt the Company's supply chains. Therefore, the Russian invasion to Ukraine does not have a direct negaTve impact on the Company's producTon or sales and does not create any uncertainty in this regard.
The Company was only negaTvely affected by the secondary effects of the invasion in the form of increased electricity prices and inflaTon. However, inflaTon and energy prices have declined and stabilised in the first half of 2024 compared to the previous period and the Company does not expect a material change in this trend by the end of 2024. Thus, the Company's acTviTes are not threatened by these secondary effects of the invasion.
The Company has not taken any specific measures to miTgate and address the impact of the Russian invasion or risk management strategy, nor has it received any public support in this regard. The Company did not experience any significant cyber security events or an increase in other threats related to the Russian invasion.
Accordingly, the Company has not experienced and does not expect any material adverse effects on the Company's operaTons or economic condiTon as a result of the Russian invasion to Ukraine. Conversely, the geopoliTcal tensions triggered by the Russian invasion of Ukraine and the associated increase in interest by government actors to enhance their defence capabiliTes may present new business opportuniTes for the Company.
In the second half of 2024, the Company intends to operate in the same sector, i.e. the manufacture and sale of UAVs. The scope of the Company's producTon acTviTes will depend on the volume of orders for UAVs, and the Company expects a further gradual increase in orders by tens of UAVs, both with regard to the geopoliTcal situaTon in the world and the interest of individual countries in strengthening their defence capabiliTes, and due to the growing use of UAVs in the civilian sector.
The Company intends to conTnue to prepare the project and the documents necessary to apply for a building permit for the construcTon of a new producTon, service and training centre in Písek.
The Company does not have any other informaTon for the second half of 2024 that would indicate a change in the Company's performance from the first half of the year.
The Company's business is mainly based on the implementaTon of individual orders and projects. There are currently a number of projects in progress and the loss of any one of them could adversely affect the client's business.
The Company competes in the global market with a number of internaTonal compeTtors. Given the aZracTveness of the market segment, further compeTTve entry could have a significant negaTve impact on the Company's price reducTons, sales volumes and future sales prospects.
The products manufactured by the Company, i.e. UAVs, consTtute dual-use products within the meaning of RegulaTon (EU) 2021/821 of the European Parliament and of the Council sexng up a Union regime for the control of exports, brokering, technical assistance, transit and transfer of dual-use items (recast), as amended. There is a risk of failure to acquire an export licence in connecTon with an already concluded contract for the supply of a UAV and its accessories, in which case, depending on the contractual arrangements, the Company would be obliged to return the deposit paid and would not be able to make the relevant sales.
The Company has two key areas of know-how. The first is the producTon of a specific technology and combinaTon of sensors in a unique unmanned aircraW that can be mass produced and customized to meet individual customer needs. The second area is a detailed understanding of the specific needs of the client in specific regions, which the Company obtains through direct contact with its sales team. The loss of key personnel (and therefore know-how) in these areas would result in a reducTon in the Company's sales unTl new employees are recruited and trained. However, the Company is not aware of any specific facts that would indicate a loss of key personnel and know-how in the second half of 2024.
The Company has property insurance on all significant assets. However, there can be no assurance that the costs associated with any natural or other unforeseen events (such as fire, storms, flood, wind storm, hail, etc.) will not have a negaTve impact on the Company's assets and economic and financial posiTon, as the insurance does not provide full coverage for all risks associated with the Company's property.
As the Company largely uses advances to finance producTon, the credit risk arising from business relaTonships is not significant. The Company does not use any other forms of collateral apart from advances. The Company's management has a credit policy in place and credit risk exposure is monitored on an ongoing basis.
As the Company uses advances from customers to finance the producTon and purchase of components, there is a risk of a lack of liquidity in the event of non-delivery of the product in the required quality and/or Tme, which could lead to a refusal to pay the addiTonal purchase price, or to a demand for the return of the advance and payment of a possible penalty. In such a case, the Company may not be able to meet its obligaTons to its suppliers. However, the Company is not aware of any specific facts indicaTng that this risk will materialise in the second half of 2024.
This half-yearly financial report is based primarily on the condensed interim consolidated financial statements prepared as at 30 June 2024 in accordance with InternaTonal Financial ReporTng Standards as adopted by the European Union (InternaTonal AccounTng Standards - IAS and InternaTonal Financial ReporTng Standards - IFRS).
This half-yearly financial report is not audited.
Consolidated Financial Statements as of 1 January - 30 June 2024 Prepared in Accordance with InternaTonal Financial ReporTng Standards
| Note | As of 30/6/2024 |
As of 30/6/2023 |
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|---|---|---|---|
| thous. CZK | thous. CZK | ||
| Revenue from contracts with customers | 9 | 331,252 | 183,480 |
| Revenue from the sale of finished goods and merchandise |
330,352 | 183,459 | |
| Revenue from the sale of services | 900 | 21 | |
| Other operaNng income | 41 | - | |
| Change in finished goods inventory and work in progress |
3,257 | 12,045 | |
| Material and energy consumpNon | 56,547 | 83,816 | |
| Payroll Costs | 18,443 | 13,296 | |
| Cost of services, repairs and maintenance | 8,892 | 14,056 | |
| DepreciaNon and amorNsaNon costs | 3,275 | 1,892 | |
| Impairment losses on assets | - | - | |
| Other operaNng expenditures | 91,848 | 568 | |
| Financial costs | 682 | 2,088 | |
| Financial income | 5,047 | 11,124 | |
| Other income | - | - | |
| Profit/Loss before tax | 153,396 | 66,843 | |
| Income Tax | 32,200 | - | |
| Profit for the period | 121,196 | 66,843 | |
| Earnings per share | |||
| Basic, earnings per share aXributable to | |||
| shareholders of ordinary shares of the parent company |
25.74 | 14.20 | |
| OTHER COMPREHENSIVE INCOME | |||
| Profit (loss) on revaluaNon of assets | - | - | |
| Total other comprehensive income | - | - | |
| Total comprehensive income for the period | 121,196 | 66,843 |
| Note | As of 30/6/2024 |
As of 30/6/2023 |
As of 1/1/2023 |
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|---|---|---|---|---|
| thous. CZK | thous. CZK | thous. CZK | ||
| ASSETS | ||||
| Long-term assets | ||||
| Land, buildings and equipment | 49,401 | 36,210 | 31,893 | |
| Intangible assets | 12,809 | 5,246 | 4,263 | |
| Right-of-use assets | 12 | 702 | 2,386 | 1,361 |
| Deferred tax assets | 588 | - | - | |
| 63,500 | 43,842 | 37,517 | ||
| Short-term assets | ||||
| Inventories | 50,949 | 124,793 | 66,315 | |
| Trade and other receivables | 400,005 | 111,367 | 488 | |
| Contractual assets | - | - | - | |
| Other current receivables and financial assets | 384 | 316 | 361 | |
| Cash and cash equivalents | 57,512 | 179,317 | 63,160 | |
| 508,850 | 415,793 | 130,324 | ||
| TOTAL ASSETS | 572,350 | 459,635 | 167,841 | |
| EQUITY | ||||
| Registered Capital | 4,709 | 4,709 | 4,709 | |
| Issue premium | 159,269 | 159,269 | 159,269 | |
| Other funds | - | - | - | |
| Retained earnings | 300 208 | 17,373 | -49,472 | |
| Total equity | 464,187 | 181,352 | 114,506 | |
| Long-term liabiliEes | ||||
| Lease payables - non-current | - | 797 | - | |
| Deferred tax liabiliNes | - | - | - | |
| - | 797 | - | ||
| Short-term liabiliEes | ||||
| Trade and other payables | 68,057 | 8,177 | 6,952 | |
| Contractual obligaNons | - | 263,079 | 44,137 | |
| LiabiliNes under leases | 639 | 1,619 | 1,361 | |
| State subsidies | 6,444 | 4,493 | - | |
| Income tax liabiliNes | 32,200 | - | 767 | |
| Provisions | 823 | 118 | 118 | |
| 108,163 | 277,486 | 53,335 | ||
| Total liabiliEes | 108,163 | 278,283 | 53,335 | |
| TOTAL EQUITY AND LIABILITIES | 572,350 | 459,635 | 167,841 |
| Registered | Share | Other | Retained | Total | |
|---|---|---|---|---|---|
| in thous. CZK | Capital | premium | funds | earnings | equity |
| Status as of 1/1/2023 | 4,709 | 159,269 | - | -49,472 | 114,506 |
| Earnings for the period | - | - | - | 66,843 | 66,843 |
| Other comprehensive income | - | - | - | - | - |
| Full result for the period | 4,709 | 159,269 | - | 17,373 | 181,352 |
| Status as of 30/6/2023 | 4,709 | 159,269 | - | 17,373 | 181,352 |
| Status as of 1/1/2024 | 4,709 | 159,269 | - | 172,012 | 342,990 |
| Earnings for the period | - | - | - | 121,196 | 121,196 |
| Other comprehensive income | - | - | - | - | - |
| Full result for the period | 4,709 | 159,269 | - | 300,208 | 464,187 |
| Status as of 30/6/2024 | 4,709 | 159,269 | - | 300,208 | 464,187 |
| thous. CZK | Note | As of 30/6/2024 |
As of 30/6/2023 |
|---|---|---|---|
| Cash flows from operaEng acEviEes | |||
| Profit before tax | 315,035 | 66,843 | |
| Adjustments: | |||
| DepreciaNon and amorNsaNon costs | 3,275 | 1,892 | |
| Financial income | -4,905 | -3,124 | |
| Financial costs | 27 | 27 | |
| Change in reserves | 705 | - | |
| Exchange rate differences | - | - | |
| Profit on sale of land, buildings and equipment | - | - | |
| Other non-monetary items | -68 | 45 | |
| Working capital adjustments: | |||
| Change in trade and other receivables | -288,638 | -110,879 | |
| Change in inventory | 73,844 | -58,478 | |
| Change in trade and other payables | -201,249 | 224,661 | |
| -101,974 | 120,987 | ||
| Interest received | 4,905 | 3,124 | |
| Interest paid | -27 | -27 | |
| Income tax paid | 1 | -766 | |
| Net cash flows from operaEng acEviEes | -97,095 | 123,318 | |
| Cash flows from invesEng acEviEes | |||
| Profit on sale of land, buildings and equipment | - | - | |
| Purchase of land, buildings and equipment | -15,370 | -5,448 | |
| Purchase of intangible assets | -7,563 | -983 | |
| AddiNons to capitalised development costs | - | - | |
| Net cash flows from invesEng acEviEes | -22,933 | -6,431 | |
| Cash flows from financing acEviEes | |||
| Payments of lease liabiliNes | -1,777 | -730 | |
| Proceeds from the issue of shares | - | - | |
| Dividends paid | - | - | |
| Net cash flows from financing acEviEes | -1,777 | -730 | |
| Net increase in cash and cash equivalents | -121,805 | 116,157 | |
| Impact of changes in exchange rates | - | - | |
| Cash and cash equivalents at the beginning of the period | 179,317 | 63,160 | |
| Cash and cash equivalents at the end of the period | 57,512 | 179,317 |
Primoco UAV SE (the "Company" or the "Parent Company") is a joint stock Company incorporated and domiciled in the Czech Republic, whose shares are publicly traded on the Prague Stock Exchange. The Company has the registered seat at Výpadová 1563/29f, 153 00 Praha 5. The Company idenTficaTon number is 037 94 393. The Company is the sole shareholder of Primoco UAV Defence s.r.o. with its registered office at Výpadová 1563/29f, 153 00 Prague 5 (hereinaWer referred to as "Primoco Defence" or "subsidiary").
The Company and its subsidiary (collecTvely, the "Group") are engaged in the manufacture and sale of medium-sized, fully autonomous unmanned aerial vehicles (UAVs) and provide related aeronauTcal services.
The Group has its own research and development team and trained staff capable of producing up to 100 UAVs per year. AircraW are manufactured and assembled from their own components - engine, airframe and other parts. In 2018, the Group conducted an iniTal public offering of approximately six percent of its shares on the Prague Stock Exchange. Through the subscripTon, the Group managed to raise CZK 63 million, which it used, among other things, for the acquisiTon of the factory airport in Písek-Krašovice. The Group conTnues to operate and develop its unmanned aerial system capabiliTes without foreign capital, bank loans and subsidies. In addiTon, the Group raised new funds of CZK 90.5 million through a secondary share issue in 2021.
The Group is ISO 9001 cerTfied and is a proven military aerospace design and manufacturing organizaTon (DOA/POA). In 2019 through its subsidiary Primoco UAV Defense s.r.o. the Company obtained a license from the Czech Ministry of Industry and Trade to trade in military material. The Group received EASA LUC (Light Unmanned CerTficate) from the Civil AviaTon Authority of the Czech Republic. The Group does not manufacture or sell combat UAVs with muniTons. It uses military material only at the level of sensors, special electronics and soWware. The main markets targeted by the Group are primarily Europe, the Middle East, Africa and Asia. The Group offers its customers clearly demonstrable economic benefits when compared to the use of alternaTve soluTons (e.g. helicopters).
The consolidated financial statements of the Group are prepared in accordance with InternaTonal Financial ReporTng Standards as adopted by the European Union ("IFRS"). The consolidated financial statements are prepared at historical cost. The consolidated financial statements are presented in Czech crowns and all values are rounded to the nearest thousand CZK, unless otherwise stated in. The consolidated financial statements are prepared on a going concern basis. The Group's fiscal year begins on 1 January and ends on 31 December.
The consolidated financial statements include the financial statements of Primoco UAV SE and its subsidiary. Control is achieved when the Group is exposed to, or has rights to, variable returns by virtue of its involvement with the investee or can affect those returns through its ability to exercise power over the investee. Control is achieved only if these condiTons are met:
It is presumed that control is achieved through the ownership of a majority of the voTng rights. In addiTon to this assumpTon, and where the Group has less than a majority of the voTng rights of the investee, the Group will take into account all relevant facts and circumstances when considering whether control has been achieved, which includes:
The Group shall reassess whether or not it has control over an investee when facts and circumstances indicate that one or more of the elements of control described above have changed. ConsolidaTon of a subsidiary begins when the Group obtains control of the subsidiary and ends when the Group loses control of the subsidiary. The assets, liabiliTes, income and expenses of the subsidiary are included in the consolidated financial statements from the date the Group obtains control unTl the date the Group loses control of the subsidiary.
Profit or loss and all components of other comprehensive income ("OCI") are aZributed to the owners of the Group's parent and non-controlling interests, even though this would result in the non-controlling interests having a negaTve balance. Where necessary, adjustments are made to the financial statements of subsidiaries to align their accounTng policies with those of the Group. All intercompany assets, liabiliTes, equity, income, expenses and cash flows related to transacTons between members of the Group are eliminated on consolidaTon.
Changes in the Group's ownership interests in subsidiaries that do not result in a loss of control are accounted for as equity transacTons.
If the Group loses control of a subsidiary, it derecognises the related assets (including goodwill), liabiliTes, non-controlling interests and other equity items and recognises the resulTng gain or loss in profit or loss. The remaining investment in the former subsidiary is stated at fair value.
The Consolidated Financial Statements for the period ending 30 June 2024 are the first financial statements prepared by the Group in accordance with IFRS.
The Group has prepared Consolidated Financial Statements that comply with IFRS applicable to the period ending 30 June 2024, together with the comparaTve period to 30 June 2023 as described in the accounTng policies. In preparing these financial statements, the Group's opening statement of financial posiTon has been prepared as at 1 January 2024, the Group's date of transiTon to IFRS.
In preparing the opening statement of financial posiTon at the date of transiTon to IFRS, the Group has applied IFRS 1 First-Tme AdopTon of InternaTonal Financial ReporTng Standards. IFRS 1 sets out the procedures to be followed by the Group when first applying IFRS as a basis for preparing consolidated financial statements. The Group is required to determine its accounTng policies under IFRS at 30 June 2024 and generally apply them retrospecTvely to determine the opening IFRS statement of financial posiTon at the date of transiTon, 1 January 2024. IFRS 1 allows certain exempTons from retrospecTve applicaTon of certain IFRS requirements effecTve for the period ending 30 June 2024.
The esTmates as at 1 January 2024 and 30 June 2024 are consistent with the esTmates made at the same dates in accordance with Czech AccounTng Standards ("CAS") (aWer adjustments for any differences in accounTng pracTces).
The accounTng policies used by in the preparaTon of the Consolidated Financial Statements are set out below. These accounTng policies have been followed in all material respects in the periods presented.
Revenue is recognised when the Group has discharged the performance obligaTon and the amount of revenue can be reliably measured. The Group recognises revenue at an amount that reflects the consideraTon to which the Group expects to be enTtled (net of expected discounts) in exchange for the transfer of goods or services to the customer.
All customer contracts are analysed aWer negoTaTon to idenTfy any performance obligaTons to the customer. The transacTon price is then determined and allocated to the individual performance obligaTons on the basis of a separate selling price. Accordingly, revenue is recognised for individual transacTons at the appropriate amount when control of the goods or services passes to the customer, either in a lump sum or on an ongoing basis.
Revenue from the sale of aircraW, controllers, payloads and spare parts is recognised when control passes to the customer and the amount of revenue is agreed or reliably determinable and receipt of payment is probable. This generally corresponds to the moment when the products are delivered to the customer.
Revenue from the sale of services that are sold with the aircraW but are disTnct from the aircraW (e.g. pilot and mechanic training) and that will be provided in future periods are idenTfied as separate performance obligaTons and are recognised when the service is provided or on a straight-line basis over a given period of Tme if the services are provided on an ongoing basis over a period of months. The payment received is iniTally recognised in the contractual liability for payments received and is subsequently dissolved into revenue based on the length of the service contract.
A contractual asset is the Group's right to receive consideraTon in exchange for goods, products or services that it has transferred to a customer. If the Group provides the consideraTon by transferring the good, product or service to the customer before the customer pays the consideraTon or before the consideraTon is due, it recognises the conTngent consideraTon as a contract asset.
A contractual obligaTon is recognised when the Group has received payment of consideraTon from the customer or payment is due (whichever is earlier) before the Group provides the related goods or services. Contractual obligaTons are recognised as revenue when the Group performs under the contract (i.e. transfers control of the related goods or services to the customer).
A receivable is recognised when the Group has an uncondiTonal right to the consideraTon (i.e. only the passage of Tme is required before the consideraTon is due).
Intangible fixed assets acquired separately are measured at cost on iniTal recogniTon. AWer iniTal recogniTon, intangible fixed assets are stated at cost less accumulated amorTsaTon and accumulated impairment losses. Internally generated intangible fixed assets, except for capitalised development costs, are not capitalised and the related expenses are charged to profit or loss in the period in which they are incurred. Directly aZributable costs that are capitalised as part of the soWware include staff costs and a corresponding porTon of the related overheads. Capitalised development costs are recognised as intangible assets and amorTsed from the Tme the asset is ready for use.
The useful lives of intangible assets are assessed as finite or indefinite.
Intangible assets with finite useful lives are amorTsed over their useful lives and assessed for impairment whenever there is an indicaTon that the intangible asset may be impaired. The amorTsaTon period and method of amorTsing an intangible asset with a finite useful life shall be reviewed at least at the end of each financial year. Changes in the expected useful life or in the expected paZern of consumpTon of future economic benefits arising from an asset are treated as changes in the amorTsaTon period or method of amorTsaTon and are treated as changes in accounTng esTmates.
AmorTsaTon of intangible assets with finite useful lives is charged on a straight-line basis over their esTmated useful lives as follows:
| Years | |
|---|---|
| Intangible results of | |
| development | 6 |
| SoWware | 3 |
| Other valuable rights | 6 |
Gains or losses on derecogniTon of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is derecognised.
Property, plant and equipment are stated at cost less accumulated depreciaTon and any accumulated impairment losses. Cost includes the total amount paid and the fair value of any addiTonal consideraTon given to acquire the asset and includes the costs directly aZributable to making the asset capable of operaTng as intended.
If significant parts of property, plant and equipment need to be replaced at certain intervals, the Group depreciates them separately based on their specific useful lives. Similarly, when a major inspecTon is carried out, the cost is recognised in the carrying amount of property, plant and equipment as a replacement if the criteria for recogniTon are met. All other repair and maintenance costs are recognised in profit or loss as incurred.
DepreciaTon is charged on a straight-line basis over the esTmated useful lives of the assets as follows:
| Years | |
|---|---|
| Buildings | 20-30 |
| Means of transport | 5 |
| Test aircraW | 5 |
| NegaTve forms | 3 |
| Other tangible assets | 3-5 |
Land and tangible assets under construcTon are not depreciated.
Property, plant and equipment and significant porTons thereof that were originally recognised are derecognised on disposal or when no future economic benefits are expected from their use or disposal. Any gain or loss arising on derecogniTon of an asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss when the asset is derecognised.
The residual values, useful lives and depreciaTon methods of property, plant and equipment are reviewed at the end of each financial year and adjusted prospecTvely if necessary.
Items of property, plant and equipment with a useful life of more than one year and whose valuaTon is less than CZK 60 thousand, are charged directly to expenses.
The Group assesses at each financial statement date whether there is any indicaTon that an asset may be impaired. If there is any indicaTon, or if annual impairment tesTng is required, the Group esTmates the recoverable amount of the asset. The recoverable amount of an asset is the higher of the fair value of the asset or cash-generaTng unit ("CGU") less costs of disposal and its value in use. The recoverable amount is determined for an individual asset unless the asset generates cash receipts that are largely independent of cash receipts from other assets or Groups of assets. If the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is wriZen down to its recoverable amount.
In assessing value in use, esTmated future cash flows are discounted to present value using a pre-tax discount rate that reflects current market assessments of the Tme value of money and asset-specific risks. In determining fair value less costs to dispose, recent market transacTons are taken into account where available. If such transacTons cannot be idenTfied, an appropriate valuaTon model shall be used. These calculaTons are compared to valuaTon mulTples, quoted share prices of publicly traded companies or other available fair value indicators.
Impairment losses on conTnuing operaTons are recognised in profit or loss.
For assets, an assessment is made at each reporTng date whether there is any indicaTon that previously recognised impairment losses no longer exist or have decreased. If such indicaTons exist, the Group esTmates the recoverable amount of the assets or CGUs. A previously recognised impairment loss shall be reversed only if there has been a change in the assumpTons used to determine the recoverable amount of the assets since the impairment loss was last recognised. Reversals are limited so that the carrying amount of the asset does not exceed its recoverable amount or the carrying amount that would have been determined net of depreciaTon had no impairment loss been recognised in previous years. Such cancellaTons are recognised in profit or loss.
Intangible assets with indefinite useful lives are tested for impairment annually at the reporTng date, either individually or at the level of the cash-generaTng unit, if circumstances indicate that the carrying amount may be impaired.
A lease is a contract or part of a contract that transfers the right to use an idenTfiable asset for a specified period of Tme in exchange for consideraTon. At the incepTon of the contract, the Group will assess whether the contract is a lease or contains a lease. The Group reassesses whether an agreement is or contains a lease only when the terms of the agreement change. The Group assesses whether the contract transfers the right to control the use of an idenTfiable asset for a specified period of Tme on the basis of:
The Group assesses whether a contract contains a lease separately for each potenTal lease component.
The Group does not have any external subleases outside the Group or any agreements where the Group is the lessor.
At the commencement date of the lease, the lessee measures the lease liability at the present value of the lease payments that will be outstanding at that date. Lease payments are payments by the lessee to the lessor for the right to use the underlying asset for the term of the lease. These payments include:
Subsequent to the commencement date, variable lease payments that are not included in the measurement of the lease liability are recognised in profit or loss in the period in which the event or condiTon giving rise to the payments occurs. Interest on the lease liability is a finance cost of the Group.
The Group measures the right-of-use asset at the commencement date of the lease under the lease agreement. This award is based on:
Right-of-use assets are generally depreciated on a straight-line basis over the shorter of the useful life of the asset or the lease term.
The consolidated financial statements of the Group are presented in Czech crowns. Items included in the financial statements of each enTty are measured in that funcTonal currency.
TransacTons in foreign currencies are iniTally accounted for by the Group's enTTes at the respecTve funcTonal currency rates prevailing at the date of the transacTon.
Monetary assets and liabiliTes denominated in foreign currencies are translated at the spot rate of the funcTonal currency at the date of the financial statements.
Differences arising on the seZlement or translaTon of monetary items are recognised in profit or loss as finance income and expense. Non-monetary items that are measured at historical cost in a foreign currency are translated at exchange rates prevailing at the date of the iniTal transacTons. Non-monetary items measured at fair value in a foreign currency are translated at the exchange rates prevailing at the date the fair value is determined. A gain or loss on the translaTon of non-monetary items measured at fair value is recognised in accordance with the recogniTon of a gain or loss on the change in the fair value of the item.
A financial instrument is any contract that gives rise to a financial asset of one enTty and a financial liability or equity instrument of another enTty.
Financial assets are classified based on the Group's business model and the characterisTcs of the contractual cash flows. Under IFRS 9, financial assets are categorised as follows: financial assets subsequently measured at amorTsed cost ("AC"), financial assets at fair value through other comprehensive income ("FVTOCI") and financial assets at fair value through profit or loss ("FVTPL").
Trade and other receivables that do not contain a significant financial component or for which the Group has applied a pracTcal expedient are measured at transacTon price determined in accordance with IFRS 15.
The Group's financial assets comprise cash and trade and other receivables, net of significant financial components, that meet the criteria for classificaTon as AC.
Trade and other receivables are stated at their original invoice value less an allowance for impairment.
A descripTon of the Group's impairment policy is set out below, together with further informaTon on trade and other receivables.
As the Group's financial statements include only financial assets represenTng trade and other receivables that do not contain a significant financial component, the Group applies a simplified approach to calculaTng expected credit losses ("ECL"). Therefore, the Group does not monitor changes in credit risk but instead recognises an allowance for losses at each financial statement date based on lifeTme ECL. The carrying amount of the asset is reduced either directly or through an allowance account. The amount of the loss is recognised in profit or loss.
The simplified approach adopted by the Group uses elements of the general approach, the main difference being that it does not use the phasing of financial assets.
The determinaTon of the ECL is based on three components used by the Group: probability of default ("PD"), exposure at default ("EAD") and loss given default ("LGD"):
Impaired receivables are derecognised if they are assessed as uncollecTble.
Financial liabiliTes are classified primarily in the fair value measurement category. The Group's financial liabiliTes include trade and other payables.
Trade payables are stated at nominal value, which is considered to be substanTally the same as fair value.
A financial liability is derecognised when the liability is discharged, cancelled or exTnguished. When an exisTng financial liability is replaced by another liability from the same lender on substanTally different terms, or the terms of an exisTng liability are substanTally modified, the exchange or modificaTon is treated as a derecogniTon of the original liability and the recogniTon of a new liability. The difference in the respecTve carrying amounts is recognised in profit or loss.
Inventories are valued at the lower of cost or net realisable value.
Costs are allocated to individual items on a first-in, first-out (FIFO) basis (the iniTal cost for valuing inventory addiTons is used as the iniTal cost for valuing inventory depleTon). The cost of purchased inventory includes costs associated with the acquisiTon (freight, duty, commissions, etc.).
Inventories generated by own operaTons are measured at cost, which includes direct costs incurred in producTon or other acTviTes and, where appropriate, the porTon of indirect costs that relates to producTon or other acTviTes.
Net realisable value is the esTmated selling price in the ordinary course of business less esTmated costs of compleTon and esTmated costs necessary to complete the sale.
Cash and short-term deposits in the statement of financial posiTon include cash in hand and cash at banks.
For the purposes of the consolidated statement of cash flows, cash and cash equivalents consist of cash and short-term deposits as defined above, net of outstanding overdraWs as these are considered an integral part of the Group's cash management.
Provisions are recognised when the Group has a present obligaTon (legal or construcTve) as a result of a past event and it is probable that an ou|low of resources embodying economic benefits will be required to seZle the obligaTon and a reliable esTmate can be made of the amount of the obligaTon. The cost of the provision is recognised in profit or loss.
If the effect of the Tme value of money is significant, provisions are discounted using a normal pre-tax rate that reflects, where appropriate, the risks specific to the liability. When discounTng, the increase in the provision due to the passage of Tme is recognised as a finance cost.
The Company recognises a liability to pay cash amounts to the Company's shareholders when the payment is authorised and the payment is no longer at the discreTon of the Company. According to the Czech Company law, a demerger is approved if it is approved by the shareholders. The corresponding amount is recognised directly in equity.
Income tax receivable and payable for the year are measured at the amount expected to be recovered from or paid to the tax authoriTes. The calculaTon uses tax rates and tax laws that are enacted or substanTvely enacted at the date of the financial statements.
Income tax payable relaTng to items recognised directly in equity is recognised in equity and not in profit or loss. The Group's management regularly assesses the posiTons taken in tax returns with regard to situaTons where the applicable tax regulaTons are subject to interpretaTon and, where necessary, makes provisions. A provision for income tax has been made at 30 June 2024. No tax provision has been made as at 30 June 2023.
Deferred tax is calculated separately for each Group Company using the liability method on temporary differences between the tax bases of assets and liabiliTes and their carrying amounts for financial reporTng purposes.
Deferred tax liabiliTes are recognised for all temporary differences except:
Deferred tax assets are recognised for all deducTble temporary differences, carryforwards of unused tax credits and unused tax losses when it is probable that taxable profit will be available against which the deducTble temporary differences and carryforwards of unused tax credits and unused tax losses can be uTlised, except:
the temporary differences will reverse in the foreseeable future and that taxable profit will be available against which the temporary differences can be uTlised.
The carrying amount of deferred tax assets is reviewed at each financial statement date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be uTlised. Unrecognised deferred tax assets are reassessed at each reporTng date and are recognised to the extent that it is probable that future taxable profit will allow the deferred tax asset to be realised.
Deferred tax assets and liabiliTes are measured at the tax rates that are expected to apply in the year in which the asset is realised or the liability is seZled, based on tax rates (and tax laws) that have been enacted or substanTvely enacted by the reporTng date.
Deferred tax relaTng to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax assets are recognised in the related transacTon either in other comprehensive income or directly in equity.
Deferred tax assets and deferred tax liabiliTes are offset when there is a legally enforceable right to set off current tax assets against current tax liabiliTes and when the deferred taxes relate to the same taxable enTty and the same taxaTon authority.
Tax benefits acquired in a business combinaTon that do not meet the criteria for separate recogniTon at that date are recognised subsequently if new informaTon about facts and circumstances changes. The adjustment is either treated as a reducTon in goodwill (unless it exceeds goodwill) if it arises during the measurement period or is recognised in profit or loss.
The preparaTon of the Consolidated Financial Statements requires the use of esTmates and assumpTons that affect the reported amounts of revenues, expenses, assets and liabiliTes and disclosure of related notes and conTngent liabiliTes at the date of the financial statements. Uncertainty about these assumpTons and esTmates could lead to results that require a significant adjustment to the carrying amount of the assets or liabiliTes involved in future periods.
Management has determined these esTmates and assumpTons based on all relevant informaTon available to it. There have been no changes in the nature or amount of the esTmates used since the previous financial statements were issued.
| Main | |||||
|---|---|---|---|---|---|
| Name | Ac5vity | Seat | Address | 30/6/2024 | 30/6/2023 |
| Primoco UAV | UAV | Czech | Výpadová 1563/29f | ||
| SE | ProducTon | Republic | 153 00 Prague 5 | Company | Company |
| Primoco UAV | Czech | Výpadová 1563/29f | |||
| Defence, s.r.o. | UAV Sale | Republic | 153 00 Prague 5 | 100% | 100% |
The consolidated financial statements of the Group include:
All shares are ordinary unless otherwise stated.
The day-to-day operaTons of the Group companies are controlled by management. Strategic and long-term decisions regarding major investment acTons and the basic direcTon of the Group's development are subject to the approval of the Group's management. The Board of Directors is the highest governing body of the parent Company, which is responsible for the business management and acts for the Company in all maZers not assigned by the ArTcles of AssociaTon or by law to the General MeeTng or the Supervisory Board. The Supervisory Board is the controlling body of the Company and supervises the performance of the powers of the Board of Directors and the Company's acTviTes.
As at 30 June 2024, the composiTon of the Group's management was as follows:
| Chairman of the Board of Directors, | |
|---|---|
| Ladislav Semetkovský | CEO |
| Petr Kováč | Member of the Board of Directors |
| Romana Wyllie | Member of the Board of Directors |
| Josef Št'astný | ProducTon Director |
| Radek Suk | Chief Pilot and Chief Designer |
| Miroslav Mišík | Chief Financial Officer |
| Vladan Ševčík | Quality Director |
| Jakub FojFk | Sales Director |
| Jan Sechter | Chairman of the Supervisory Board |
|---|---|
| Vladan Ševčík | Member of the Supervisory Board |
| Jakub FojFk | Member of the Supervisory Board |
The Group is represented by a single segment.
Management is the chief operaTng decision maker (CODM) and monitors operaTng results and metrics to make resource allocaTon decisions and assess performance at a segment level (i.e. the Group as a whole).
The Group consists of one segment, which is engaged in the sale of UAVs and related equipment and services.
The Tming of revenue recogniTon was as follows:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Goods and services transferred on a | ||
| one-off basis | 318,892 | 161,812 |
| Services transferred on an ongoing | ||
| basis | 12,360 | 21,668 |
| Total Revenue from Contracts with | ||
| Customers | 331,252 | 183,480 |
| thous. CZK | 30/6/2024 | 30/6/2023 | 1/1/2023 |
|---|---|---|---|
| Trade Receivables | 400,005 | 111,367 | 488 |
| Contractual assets | - | - | - |
| Contractual obligaTons | - | 263,079 | 44,137 |
A typical contract with a customer includes several performance obligaTons. The transacTon price is allocated to the following obligaTons based on their individual selling prices. InformaTon on the Group's performance commitments is set out below:
The obligaTon is fulfilled at the Tme of delivery and handover of the aircraW and equipment to the customer.
The payment is divided into two parts. 50% of the payment is due 14 days aWer signing the contract, the remaining amount is due 14 days before the agreed date of delivery to the customer.
ObligaTons are performed on an ongoing basis and payment for the performance of these obligaTons is part of the transacTon price stated in the contract.
The Group recognises contractual obligaTons for these transacTons and recognises revenue on an ongoing basis over 2-3 months as the customer receives and consumes the benefits of the transacTon.
The customer can order remote pilot support measured in flight hours as part of the contract.
As this service is prepaid by the customer, the Group recognises a contractual obligaTon and meets this obligaTon on an ongoing basis in accordance with the customer's demand and consumpTon of flight hours.
Cost of intangible fixsed assets:
| thous. CZK | Purchased soWware |
Patents | Other | Intangible | Acquired |
|---|---|---|---|---|---|
| and | intangible | results of | intangible | ||
| rights | assets | development | assets | ||
| 1/1/2023 | 752 | - | 125 | 2,998 | 2,943 |
| AddiTons | - | - | - | - | 1,259 |
| Transfer | - | - | - | - | - |
| Disposals | - | - | - | - | - |
| Exchange rate differences | - | - | - | - | - |
| 30/6/2023 | 752 | - | 125 | 2,998 | 4,202 |
| AddiTons | - | - | 1,287 | 4,478 | 8,960 |
| Transfer | - | - | - | - | - 5,765 |
| Disposals | - | - | - | - | - |
| Exchange rate differences | - | - | - | - | - |
| 30/6/2024 | 752 | - | 1,412 | 7,476 | 7,397 |
Impairment of intangible assets:
| thous. CZK | Purchased soWware |
Patents | Other | Intangible | Acquired |
|---|---|---|---|---|---|
| and | intangible | results of | intangible | ||
| rights | assets | development | assets | ||
| 1/1/2023 | 708 | - | 26 | 1,821 | - |
| DepreciaTon | 16 | - | 10 | 250 | - |
| Disposals | - | - | - | - | - |
| Exchange rate differences | - | - | - | - | - |
| 30/6/2023 | 724 | - | 36 | 2,071 | - |
| DepreciaTon | 28 | - | 165 | 1,204 | - |
| Disposals | - | - | - | - | - |
| Exchange rate differences | - | - | - | - | - |
| 30/6/2024 | 752 | - | 201 | 3,275 | - |
| Residual value | |||||
| 1/1/2023 | 44 | - | 99 | 1,177 | 2,943 |
| 30/6/2023 | 28 | - | 89 | 927 | 4,202 |
|---|---|---|---|---|---|
| 30/6/2024 | - | - | 1,211 | 4,201 | 7,397 |
Cost of land, buildings and equipment:
| thous. CZK | Land plots |
Buildings | Means of transport |
Machinery and equipment |
Tangible assets in progress |
|---|---|---|---|---|---|
| 1/1/2023 | 17,351 | 10,522 | 5,913 | 4,743 | 165 |
| AddiTons | 300 | - | 2,160 | - | 5,174 |
| Transfer | - | - | - | - | - 2,460 |
| Disposals | - | - | - | - | - |
| Exchange rate differences | - | - | - | - | - |
| 30/6/2023 | 17,651 | 10,522 | 8,073 | 4,743 | 1,064 |
| AddiTons | 5,415 | - | 3,621 | 4,446 | 16,364 |
| Transfer | - | - | - | - | - 13,482 |
| Disposals | - | - | -644 | - | - |
| Exchange rate differences | - | - | - | - | - |
| 30/6/2024 | 23,066 | 10,522 | 11,030 | 9,189 | 5,761 |
Write-downs and impairment of property, plant and equipment:
| thous. CZK | Land plots |
Buildings | Means of transport |
Machinery and equipment |
Tangible assets in progress |
|---|---|---|---|---|---|
| 1/1/2023 | - 1,195 |
1,165 | 4,441 | - | |
| DepreciaTon | - 184 |
608 | 65 | - | |
| Disposals | - 0 |
0 | 0 | - | |
| Exchange rate differences | - 0 |
0 | 0 | - | |
| 30/6/2023 | - 1,379 |
1,773 | 4,506 | - | |
| DepreciaTon | - - |
1,697 | 445 | - | |
| Disposals | - - |
- | - | - | |
| Exchange rate differences | - - |
- | - | - | |
| 30/6/2024 | - 1,746 |
3,470 | 4,951 | - | |
| Residual value | |||||
| 1/1/2023 | 17,351 | 9,327 | 4,748 | 302 | 165 |
| 30/6/2023 | 17,651 | 9,143 | 6,300 | 237 | 2,879 |
| 30/6/2024 | 23,066 | 8,776 | 7,560 | 4,238 | 5,761 |
Currently, the Group leases only the head office building and related warehouse and producTon faciliTes. The office lease agreement includes an opTon for renewal and terminaTon.
The Group uses the exempTons in IFRS 16 for short-term leases and leases where the underlying asset is of low value.
| thous. CZK | 30/6/2024 | 30/6/2023 | 1/1/2023 |
|---|---|---|---|
| Buildings | 702 | 2,386 | 1,361 |
| thous. CZK | 30/6/2024 | 30/6/2023 | |
|---|---|---|---|
| Buildings | 842 | 759 |
| thous. CZK | 30/6/2024 | 30/6/2023 | 1/1/2023 |
|---|---|---|---|
| Long-term lease liabiliTes | - | 797 | - |
| Short-term lease liabiliTes | 639 | 1,619 | 1,361 |
| Liabili5es under leases | 639 | 2,416 | 1,361 |
The discount rate used was 4% (30/6/2023: 4%).
Leases are recognised subsequently in the profit and loss account:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Right-of-use assets | 842 | 759 |
| Interest expense on lease liabiliTes | 27 | 27 |
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Material | 36,914 | 71,767 |
| Spare parts | 13,533 | 9,452 |
| Unfinished producTon | 0 | -8,280 |
| Products and goods | 502 | 51,854 |
| Total Inventories | 50,949 | 124,793 |
Cost of products sold, materials consumed and change in producTon inventories:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| ConsumpTon of materials and spare parts | 55,902 | 82,749 |
| AcTvaTon of materials and goods | 0 | 0 |
| Change in producTon inventories and inventory valuaTon allowances |
3,257 | 12,045 |
| Total | 59,159 | 94,794 |
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Trade Receivables | 399,736 | 107,465 |
| Intra-Group receivables | 0 | 0 |
| Advances made | 167 | 3,860 |
| Prepaid costs | 102 | 42 |
| Receivables from tax authoriTes | 0 | 0 |
| Receivables - other |
0 | 0 |
| Total | 400,005 | 111,367 |
Trade receivables bear interest at a rate of 0.05% of the amount due for each day of delay up to a maximum of 10% and are generally due within 14 days. Trade and other receivables are non-derivaTve financial assets carried at amorTsed cost.
For the purposes of the statement of cash flows, they include cash and cash equivalents:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Cash in banks | 57,512 | 179,317 |
| Available cash | 612 | 8,786 |
| Cash and cash equivalents presented in the statement of financial posi5on and cash flows |
57,512 | 179,317 |
The fair value of cash and cash equivalents approximates the carrying amount due to its shortterm maturiTes.
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Trade payables | 438 | -762 |
| Employee-related liabiliTes | - | - |
| Advances received | - | 263,079 |
| LiabiliTes to tax authoriTes | 67,617 | 8,939 |
| Other liabiliTes | - | - |
| Total | 68,057 | 271,256 |
Trade payables are non-interest bearing and are usually seZled within 14 days.
Employee-related liabiliTes include social security and health insurance liabiliTes, payroll liabiliTes to employees and accruals for employee leave to be taken or paid in the following accounTng period.
Trade and other payables are non-derivaTve financial liabiliTes carried at accrued value. The fair value of current trade and other payables approximates its carrying amount due to its short-term maturity.
Contractual obligaTons mainly represent deferred revenue in accordance with the revenue recogniTon rules for the sale of products and training (advances received for the sale of products and services). The movements in contractual deferred income over the years are as follows:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Opening balance | 263,079 | 44,137 |
| AddiTons | - | 218,942 |
| DissoluTon | -263,079 | - |
| Total | - | 263,079 |
| Other | |
|---|---|
| thous. CZK | Provisions |
| 1/1/2023 | 118 |
| AddiTons | - |
| Used | - |
| Unused amounts refunded | - |
| 30/6/2023 | 118 |
| AddiTons | 823 |
| Used | 118 |
| Unused amounts refunded | - |
| 30/6/2024 | 823 |
Corporate income tax for companies in the Czech Republic has been set at 19% for 2023 and 21% for 2024.
The income tax structure in each accounTng period is as follows:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Income tax payable | 32,200 | - |
| Deferred Tax | - 588 |
- |
| Total | 31,612 | 0 |
ReconciliaTon of tax expense and book profit mulTplied by the Parent Company's domesTc tax rate for the periods indicated below:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| AccounTng profit before tax | 153,396 | 66,843 |
| Statutory income tax rate in the Czech Republic | 21 | 19 |
| Adjustments to income tax payable | -63 | - |
| EffecTve income tax rate | - % |
- % |
| Income tax recognised in profit and loss | 32,200 | - |
Deferred tax balances and movements:
| thous. CZK | 1/1/2024 | Charged to profit/loss |
Charged to equity |
Exchange rate differences |
30/6/2024 |
|---|---|---|---|---|---|
| Difference between the amorTsed cost of fixed assets for accounTng and tax purposes |
415 | - | - | - | 415 |
| Provisions for liabiliTes and charges |
173 | - | - | - | 173 |
| Net deferred tax asset/liability | 588 | - | - | - | 588 |
| Recognised deferred tax asset | 588 | - | - | - | 588 |
| thous. CZK | 1/1/2023 | Charged to profit/loss |
Charged to equity |
Exchange rate differences |
30/6/2023 |
|---|---|---|---|---|---|
| Net deferred tax asset/liability | - | - | - | - | - |
| Recognised deferred tax asset | - | - | - | - | - |
The Group offsets tax assets and liabiliTes only when it has a legally enforceable right to set off current tax assets and current tax liabiliTes.
Shares authorized, issued and fully paid:
| Number of Shares |
Registered Capital thous. CZK |
Issue premium thous. CZK |
|
|---|---|---|---|
| Ordinary shares | |||
| As of 1/1/2023 | 4,709 | 4,709 | 159,269 |
| Issue of share capital, nominal value of | |||
| shares 1 CZK | 4,709 | 4,709 | 159,269 |
| Conversion into shares with a nominal value | |||
| of CZK 1 | 4,709 | 4,709 | 159,269 |
| As of 30/6/2023 | 4,709 | 4,709 | 159,269 |
| As of 30/6/2024 | 4,709 | 4,709 | 159,269 |
All common shares are transferable without restricTon. One vote is associated with one share with a nominal value of CZK 1.
Staff costs for each period consist of the following:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Average number of employees and key management members of the Group |
43 | 22 |
| Salary costs and remuneraTon including company management |
13,716 | 10,106 |
| Social security and health insurance | 4,605 | 3,074 |
| Other staff costs | 122 | 116 |
| Total staff costs | 18,443 | 13,296 |
Of which the remuneraTon of key members of the Group's management:
| thous. CZK | 30/6/2024 | 30/6/2023 |
|---|---|---|
| Salary costs and remuneraTon of key management | 2,850 | 1,908 |
| Social security and health insurance | 963 | 408 |
| Total | 3,813 | 2,316 |
The classes of the Group's financial instruments correspond to the items shown in the Consolidated Financial Statement.
The Group's principal financial liabiliTes include leases and trade and other payables. The main purpose of these financial liabiliTes is to finance the Group's operaTons and investments. The Group's principal financial assets include trade and other receivables, cash and cash equivalents that arise directly from its operaTons.
The Group is exposed to market risk and liquidity risk. The Group's management idenTfies financial risks that may adversely affect the business objecTves and miTgates these risks to an acceptable level through acTve risk management.
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market prices. The type of market risk to which the Group is exposed is mainly currency risk from trading operaTons.
Currency risk is the risk that the fair value or future cash flows will fluctuate due to changes in foreign exchange rates. The Group's exposure to the risk of changes in foreign currency exchange rates relates primarily to the Group's operaTng acTviTes (where revenues or expenses are denominated in a foreign currency).
The Group invoices mainly in EUR. There is, however, some currency risk arising from sales and purchases in other currencies, parTcularly in CZK and USD.
Financial assets and liabiliTes include cash and cash equivalents, trade and other receivables and trade and other payables. All other assets and liabiliTes denominated in foreign currencies are insignificant or not subject to exchange rate risk (e.g. property, plant and equipment).
Prudent liquidity risk management involves maintaining sufficient cash and availability of funds to meet liabiliTes as they fall due. The Group regularly monitors its liquidity posiTon in order to maintain sufficient financial resources to meet its liabiliTes and receivables.
The following table summarizes the maturity profile of the Group's financial liabiliTes based on contractual undiscounted payments (in thousands CZK):
| 30/6/2024 | On request |
Less than 3 months |
3 to 12 months |
1 to 5 years |
Longer than 5 years |
Total |
|---|---|---|---|---|---|---|
| LiabiliTes under leases | - | 639 | - | - | - | 639 |
| Trade and Other Payables | - | 68,057 | - | - | - | 68,057 |
| Total | - | 68,696 | - | - | - | 68,696 |
| 30/6/2023 | On request |
Less than 3 months |
3 to 12 months |
1 to 5 years |
Longer than 5 years |
Total |
| LiabiliTes under leases | - | - | 1,619 | 797 | - | 2,416 |
| Trade and Other Payables | - | 8,177 | - | - | - | 8,177 |
| Total | - | 8,177 | 1,619 | 797 | - | 10,593 |
|---|---|---|---|---|---|---|
Trade and other payables do not include tax liabiliTes, advances received and contractual obligaTons as these are non-financial liabiliTes.
The primary objecTve of the Group's capital management is to ensure that it has the capital necessary to operate and grow the business at a reasonable cost of capital without taking undue financial risks. For Group capital management purposes, capital comprises share capital and all other capital reserves aZributable to the shareholders of the Company.
The main objecTve of the Group's capital management is to maximise shareholder value. The Group's capital allocaTon policy includes:
The Group manages its capital structure and makes adjustments to reflect changes in economic condiTons and the requirements of financial covenants. In order to maintain or adjust the capital structure, the Group may adjust the payment of dividends to shareholders, return capital to shareholders or issue new shares. The Group monitors capital using the gearing raTo:
| 30/6/2024 | 30/6/2023 |
|---|---|
| 639 | 2,416 |
| 400,005 | 111,367 |
| - 57,512 |
- 179,317 |
| 343,132 | - 65,534 |
| 464,187 | 181,352 |
| 1.35% | - 2.77% |
There have been no changes to the objecTves, policies or processes of capital management during the period.
During the first six months of 2023, the consolidated total entered into arm's length transacTons with related parTes. During the periods under review, there were no related party transacTons that materially affected the Company's results of operaTons.
During the first six months of 2024, the consolidated enTty did not enter into any contractual transacTons between related parTes. During the periods under review, there were no related party transacTons that materially affected the Company's results of operaTons.
| Accounts | |||||
|---|---|---|---|---|---|
| 30/6/2023 | Rela5on | Payables | Receivable | Purchases | Sale |
| Group | |||||
| Primoco UAV Defence, s.r.o. | Company | 14,195 | 199,005 | 14,195 | 199,005 |
| Accounts | |||||
| 30/6/2024 | Rela5on | Payables | Receivable | Purchases | Sale |
| Group | |||||
| Primoco UAV Defence, s.r.o. | Company | 0 | 297,347 | 360 | 297,347 |
On 15 August 2024, the City Council of the City of Písek gave its consent to the sale of land in the industrial zone of the City of Písek to the Company for the purpose of building a new producTon, service and training centre for the Company.
There have been no other events subsequent to the balance sheet date that would have a material impact on the consolidated financial statements as at 30 June 2024.
I, Ladislav Semetkovský, Chairman of the Board of Directors of the Company, hereby declare that to the best of my knowledge, the summary of financial statements contained above gives a true and fair view of the assets, liabiliTes, financial posiTon and result of operaTons of the Company and its consolidated unit and the above descripTon within the meaning of SecTon 119(2)(b) of Act No. 256/2004 Coll., on Capital Market Business, as amended, contains a fair summary of the informaTon required under that provision.
Prague, 25. August 2024
Ladislav Semetkovský
Chairman of the Board Primoco UAV SE
___________________________
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