Xaar reports weaker financial performance in 'mixed' year
By Josh White
Date: Tuesday 25 Mar 2025
(Sharecast News) - Xaar reported a weaker financial performance for the year ended 31 December on Tuesday, reflecting challenging end markets, particularly in ceramics and engineered systems, although the company made strategic progress in new growth areas that were expected to support stronger performance in the medium term.
The London-listed company said group revenue declined 13% to £61.4m, while adjusted profit before tax fell sharply to £0.3m from £2.9m.
Adjusted EBITDA declined 42% to £3.7m and adjusted earnings per share dropped to 0.7p.
The reported loss for the year widened to £10.7m from £2.4m in 2023.
Despite the top-line pressure, Xaar maintained a gross margin of 36%, down just two percentage points, supported by proactive cost control and a 16% reduction in adjusted operating expenses.
Gross research and development investment remained steady at around 9% of revenue.
The group ended the year with a strengthened net cash position of £8.7m, up 23% year-on-year, aided by improvements in working capital.
Xaar said its printhead business was a notable bright spot, growing revenue 23% to £18.9m, driven by early progress in new applications, including EV battery coating, 3D printing, and textiles.
That helped to offset significant declines elsewhere, with revenue in ceramics and glass falling to £7.5m from £15.5m, and engineered print systems revenue down 27% to £16.1m following the completion of a major multi-year project.
Strategic developments during the year included new customer wins and partnerships.
Xaar-enabled coating lines were launched by Omijia and Shifang for the EV battery market, while an exclusive agreement with Axalta and Dürr positioned Xaar in automotive coatings.
Printheads were also integrated into a new high-resolution colour desktop 3D printer, and OEM product launches in wax and textiles validated its broadened offering.
Looking ahead, Xaar said it expected medium-term revenue growth and margin expansion as key partnerships and product launches gain traction.
In the near term, however, continued softness in end markets, particularly for engineered print systems, was likely to weigh on results.
Management remained focussed on tight cost control and preserving its cash position as it executed on its strategy and rebuilt its sales pipeline.
"2024 was a mixed year; while we did not meet our original revenue aims, we did make strong strategic progress and delivered both a profit and increased cash over the year," said chief executive officer John Mills.
"Our key strategic milestones, notably in the areas of EV battery coating, automotive coating and desktop 3D, are setting the group up for sustainable medium-term growth and are all progressing as planned.
"Increasing market awareness of our value proposition also means that global market leaders are now approaching us to learn more about the benefits of high viscosity fluids."
Mills said that additionally, the provision of a complete turnkey solution to M&R, a major player within the textiles market, had proven "extremely" successful.
"With a second project ongoing, we continue to evaluate opportunities to roll out this go-to-market strategy to additional markets and customers, potentially transforming our future rate of growth and market capture.
"With the ceramics market decline nearing its trough, this headwind should reduce going forward, allowing new business revenue growth to translate to profit more readily.
"Overall, the visibility and scale of the medium-term opportunities at Xaar continue to grow.
"Combined with the cash on our balance sheet, we remain well-positioned to generate sustainable growth."
At 0936 GMT, shares in Xaar were up 6.67% at 64p.
Reporting by Josh White for Sharecast.com.
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