Final Results for the year ended 31 December 2023

Publication of Annual Report

Sondrel (AIM: SND), a leading provider of ultra-complex chips for leading global technology brands, announces its audited full year-results for the year ended 31 December 2023 (“FY23”) and that it has published its annual report which is available to view on the Company’s website -

Financial Review

  • Revenue of £9.4 million (FY22: £17.3 million)
  • Operating loss of £17.3 million (FY22: £5.2 million)
  • Adjusted EBITDA of £4.5 million loss (FY22: £1.1 million loss)
  • Net debt at year-end of £0.9 million (FY22: net cash of £3.7 million)

Operational Review

  • Steady project progress during the first half of FY23. However, delays on the largest ASIC project and the lack of new contract wins in the second half resulted in a significant fall in revenue and tightening of cash position
  • £2.7 million of revenue from largest ASIC project deferred from FY23 into FY24
  • Two smaller ASIC projects achieved ‘tape out’ status during FY23, one of which led to Sondrel’s first production order in late 2023
  • Joe Lopez, Group CFO, stood down in September 2023 and was replaced by Nick Stone as Interim CFO in a non-board capacity

Post Period End

  • On 6 March 2024, the Company entered into an £874,600 secured 15% convertible loan note agreement with Rox Equity Partners Limited (“ROX”) to enable the Group to meet immediate working capital requirements
  • The Company has since received a further £2 million from ROX on 28 March 2024 via a further convertible loan note under the same terms as the above and also a £5.6 million equity subscription completed on 14 June 2024.
  • The Company agreed with ROX to enter into a transformation plan (the “Transformation Plan”) that has resulted in the following management and Board changes:
    • Graham Curren has transitioned from his role as Chief Executive Officer to Non-Executive Director;
    • Nigel Vaughan has retired from his position as Non-Executive Chairman;
    • David Mitchard was appointed as interim Chief Executive Officer on 28 March 2024, and subsequently Non-Executive Chairman on 18 June 2024. David will stand down as interim Chief Executive Officer from today, following the appointment of John Chubb as Chief Executive Officer, and will remain the Company’s Non-Executive Chairman; and
    • Miles Woodhouse has been appointed as Non-Executive Director.
  • Under the Transformation Plan, the Company has also resolved to propose to cancel the admission of the Company’s ordinary shares to trading on AIM (the “Cancellation”). A circular will be sent to shareholders in due course together with a notice convening a general meeting of the Company during August 2024 to consider, inter alia, the Cancellation.

Chairman and Interim Chief Executive’s Statement 

2023 was the first full year of trading as an AIM quoted company for Sondrel (Holdings) PLC (‘Sondrel’ the ‘Company’ or, together with its subsidiaries, the ‘Group’) following the Group’s IPO in October 2022 and, as communicated by the Company throughout the period this proved to be a difficult and challenging year. These challenges extended into the first half of 2024. Delays in both existing and expected new contracts meant that the second half of the year was extremely difficult with little revenue generated and trading losses recorded. The Group’s cash position also diminished and became very weak in the second half of the year as a consequence, such that employee salaries were delayed for some employees in December 2023 and a fundraising process was commenced.  

The fundraising exercise recently concluded in June 2024, with Rox Equity Partners (‘Rox’) investing a total of £8.5 million.  It now owns 49% of Sondrel’s voting rights. The investment started with the issuance of two convertible loan notes of £0.9 million and £2 million, both during March 2024, and the signing of an exclusivity agreement between Sondrel and Rox. The exclusivity agreement allowed for Rox to invest up to a further £7.1 million alongside existing shareholders in the planned fundraise on an exclusive basis. The Rox loan notes have since been converted into equity and a further £5.6 million was subscribed for by way of a direct subscription.

One of the conditions of the fundraise was the approval by the UK secretary of state under the National Security and Investment Act 2021. The approval, received on 7 June 2024, took longer than initially anticipated and the publication of these accounts was consequently delayed beyond 30 June 2024, resulting in the suspension of trading in Sondrel’s ordinary shares on AIM. Publication of these accounts is expected to result in the restoration of trading in Sondrel’s ordinary shares.

The exclusivity agreement also committed Sondrel to a transformation plan to re-establish its baseline costs, introducing revised robust management processes and refocusing the business to resolve matters that are central to the cash flow issues faced by the Group to date. The plan has also involved the commitment to several board changes that are detailed below and an agreement to seek a proposal to cancel the admission of ordinary shares currently trading on AIM, which Sondrel remains committed to.   

Board changes 

The following board and executive management changes have been made since the publication of the last annual report: 

  • In September 2023, Joe Lopez stood down as the Group’s CFO from the board by mutual agreement and was replaced by Nick Stone as the Interim CFO, in a non-board capacity.  
  • In January 2024 Gordon Orr stood down as a non-executive director as part of steps taken to reduce his commitments.  
  • As part of the commitments made by the Company in the exclusivity agreement signed with Rox, in March 2024 Graham Curren the Founder and Chief Executive moved to become Chief Executive of Sondrel Ventures, in a role that will concentrate on the strategy and future growth of the Group. Graham remains a non-executive director on the Group’s board in addition to performing this role. 
  • Following the completion of the fundraise in June 2024, Nigel Vaughan stepped down from the board as Chairman and, having been appointed as Interim Chief Executive Officer in a non-board capacity in March 2024, I joined the board and took the role of Chairman whilst continuing in the role as Interim Chief Executive Officer. Miles Woodhouse also joined the board as Rox’s appointed non-executive director
  • It was announced in May 2024 that John Chubb will join the Board on 18 July 2024 as Chief Executive Officer, at which point I will continue solely as the non-executive Chairman.     
  • Finally, it is also announced today that Siobhan Martin will join Sondrel as Chief Financial Officer on 30 September 2024 and that Interim Chief Financial Officer, Nick Stone, will leave the Company upon the publication of these accounts.

I’d like to thank Nigel and Graham for their years of service as Chairman and Chief Executive Officer of the Group respectively, both before and after the IPO, and I look forward to continuing to working with Graham and the other members of the board as we embark on the next phase of Sondrel’s development. I would also like to thank Nick Stone for his significant contribution through what has been an uncertain period for the Company – in doing so working to secure the funding that was so critical for the Company’s continued operation.

Transformation Plan 

The transformation plan is ongoing and has involved the recruitment of a very experienced team of turnaround professionals who are putting a plan together to ensure that Sondrel’s management, cost structure and business processes are suitable for the growth ambitions that the Group continues to have. There is a particular focus on the pricing and management of projects, improved forecasting of the levels of engineering resource required to support the Business Plan and the management and continued development of the Group’s intellectual property.


The Board and Rox reached the conclusion in early discussions that the costs and complexities of being quoted on AIM do not benefit any stakeholders at this stage of the Group’s transition. It was therefore confirmed in the circular issued on 14 May 2024, that a proposal would be put to shareholders to cancel the trading of its shares on AIM. The proposal will incorporate a trading facility that Sondrel will make available to shareholders who wish to buy or sell shares on a matched bargain basis.  More information on this will be provided in due course.

The proposal to move forward with the cancellation will be put to shareholders at a general meeting in August 2024 and, if approved, the cancellation will become effective thereafter. The agenda for this meeting will also include resolutions to approve these accounts and the re-appointment of the auditors.

Trading Review 

Key Performance Indicators

2023 2022
Revenue £9.4m £17.3m
Operating loss £17.3m £5.2m
Loss after tax £21.5m £3.2m
Adjusted EBITDA £(4.5)m £(1.1)m
(Net debt)/net cash £(0.9)m £3.7m
Employees at year end 159 185


The business experienced a very difficult and challenging year from a trading point of view that also came at the same time as a slow-down in the semi-conductor market in Europe in particular. Additionally, the strategic decision taken to focus on project-based ASIC work meant that some of the smaller scale time and materials-based services work was lost. Winning of new contracts in 2023 was particularly weak, with a total of new business won of only £4.0m (2022: £25.6m).  

Steady project progress was made during the first half of the year before the lack of new business won during the year and delays on the largest ASIC project being undertaken meant that second half revenues fell significantly. This project had originally been forecast to be completed in September 2023 but only reached its successful conclusion in April 2024. This led to revenue of some £2.7m being deferred from 2023 into 2024. In parallel to this, the second phase of the project that had been expected to commence in July 2023 was also delayed and has not yet commenced.

As a result, a significant loss was made during the year of £17.3m at the operating level. The loss was compounded by an exceptionally high accelerated amortisation charge of £4.9m relating to an intangible software asset, akin to an impairment charge. This reflects the reduced utility that the Group expected to get from the asset over its remaining lifetime given the reduced level of design activity experienced by the Group.  

On the positive note, two smaller ASIC projects achieved ‘tape out’ status during the year, one of which led to Sondrel’s first production order in late 2023. The first production revenues are anticipated in the second half of 2024 as a result. In addition, a significant new ASIC project was won in early 2024 for a next generation video processing chip with a total estimated value of US$23 million across the design, qualification and projected production life of the product. 

The ASIC Market 

The market for ASIC design remains one with significant opportunity for Sondrel particularly in the growing AI market, and is extremely dynamic and evolving:  

Market Size and Growth Trends 

The ASIC chip market was valued at an estimated USD 20.29 billion in 2024 and is projected to reach USD 32.84 billion by 2031, growing at a CAGR of 7.10% during this period (Source: ASIC Chip Market Size & Share Analysis - Industry Research Report - Growth Trends (

Factors driving growth include the adoption of advanced technologies such as AI, machine learning, and 5G, and these all increase demand for ASICs across industries. 

Demand for Digitalization

The growing need for digitalization in various sectors fuels demand for specialized and efficient computing capabilities. ASIC chips can be customized for specific applications, delivering optimized performance. 

Industry Segments

ASIC chips find applications in automotive systems, aerospace subsystems, telecommunications products, medical instrumentation, data processing systems, and consumer electronics. Extensive research and development activities in automation and transportation sectors contribute to revenue generation. In summary, the ASIC market is poised for growth, driven by technological advancements and increasing demand for specialized computing solutions.  

Future Strategy 

The future strategy for Sondrel will, in part, be determined by the current transformation plan but will continue to be at least partially based on growing the volume of ASIC project work, leading to follow-on prototyping and testing work and ultimately production revenues. However, the balance between growth of capability and investment in new revenue streams and the traditional design services work that will keep the engineering work force busy will be more keenly managed in order to ensure a break-even position from both an operating profit and cash flow perspective. 

Summary and Outlook   

The completion of the recent fundraise and the support of Rox will ensure that the business is stabilised and put on a growth footing in the future based on a more solid foundation. In the short term, the current trading losses are targeted by the transformation plan to be eliminated by the last quarter of the year and thereby avoiding the need for any further fundraising to support trading activities. To achieve this target, new business wins and further cost saving measures will be required, some of them related to the de-listing process.

Rox has committed to providing a further £1.5m funding to Sondrel in the future which will provide more liquidity should it be necessary. However, it is recognised that this may not be sufficient should the expected new business wins fall short of current forecasts over the next 12 months.  This creates a material uncertainty over the cash flows of the business until such time as the revenues increase.

Despite this, the Board believes that the future prospects for the business will be more positive once the transformation plan has been delivered and Sondrel is able to compete more effectively for the many opportunities that are available in the market.    


David Mitchard
Non-Executive Chairman and Interim Chief Executive Officer
17 July 2024

Chief Financial Officer’s Review 


 £’000  2023   2022  
Consultancy   2,136   4,439  
ASIC projects 7,290   12,839  
Total   9,426   17,278  

Consultancy revenues decreased to £2.1m (2022: £4.4m) as the Group focused on developing the ASIC projects business for the future.  Despite the decision to focus on ASIC projects revenue it also declined from £12.8m to £7.3m due to project delays and lack of new business sales.  The major revenue contributor in the year was the large automotive ASIC project that started in October 2022 and which taped out in April 2024. This was delayed having originally been expected to be completed by the end of 2023, and this meant that approximately £2.7m of revenue was deferred into 2024. There were no new ASIC projects won during 2023. 


The majority of the Group’s direct cost base relates to engineering headcount and software. During the first half of 2023, revenues and margins were broadly on plan, but the delays in the delivery of the large automotive ASIC project reduced revenues and depressed margins in the second half. Contract wins in the first half of 2024 have improved gross margins and are expected to return to normal trading levels during by the end of the year.  

Administrative Expenses  

Administrative expenses decreased by 17% to £6.5m (2022: £7.8m), driven predominantly by the inclusion of IPO related costs of £1.4m in the prior year. Underlying administrative expenses (excluding depreciation, amortisation and exceptional items) increased by 1% to £6.1m (2022: £6.0m).  

Foreign Exchange  

The Group had 71% (2022: 70%) of revenues invoiced in currencies other than GBP.  The Group’s cost base has been predominantly in GBP and USD, which has historically provided a natural hedge to currency exchange risk as revenues have also been predominantly denominated in USD and GBP.  However, during 2022 a new Euro contract led to significant revenues being denominated in Euros. Exchange rate losses of £0.1m (2022: loss of £0.5m) reflected the reduction in volatility of the key currency pairs (GBP-USD and GBP-EUR) year on year. 

Adjusted EBITDA and Statutory Loss Before Tax 

Adjusted EBITDA (earnings before interest, tax, exceptional items, depreciation and amortisation) is considered by the Board to better represent the ongoing operating performance of the Group as it removes the impact of significant one-off items and smooths the impact of the cash outlay on the Groups design software. Adjusted EBITDA worsened in the year to a loss of £4.7m  (FY22: loss £1.1m). See note 7 to the financial statements for further information.  

Statutory loss before tax of £18.0 million (2022: Loss £6.4 million) includes significant cash and non-cash expenditure items, and these are reconciled to adjusted EBITDA as follows:


 £’000    2023  2022  
Statutory loss before tax   (17,979)   (6,412)  
IPO costs1 -   1,393  
Adjusted loss before tax   (17,979)   (5,019)  
Interest     656   1,175  
Depreciation    457   394  
Amortisation of intangible assets    12,150  2,384  
Adjusted EBITDA      (4,715)   (1,066)  


Research and development 

Total expenditure on research and development in the year was £9.7m (2022: £8.1m) of which £0.6m (2022: £0.6m) was on internal research and development to increase the engineering differentiation and capability to efficiently deliver new technologies. Research & development costs of £0.5m (2022: £0.2m) were capitalised during the year relating to the commencement of an automotive development programme. Costs incurred relating to the development of internal process improvements are not able to be reliably measured and have therefore been expensed through the P&L. 

Due to the nature of the work the Group is entitled to claim R&D tax credits. The amount recoverable this year is £1.2m (2022: £1.0m)  

Depreciation and Amortisation   

Depreciation and amortisation of £12.6m (2022: £2.8m) principally comprises the amortisation of the intangible software assets. The significant increase in amortisation of the intangible software was due to an accelerated charge to recognise the limited utility of the remaining asset following a reduction in design activity. The terms of the software asset have been renegotiated since year end, allowing the business to recover the lost utility by extending the period over which the asset can be used.


Finance costs in the year were £0.7m (2022: £1.2m). The interest charged under IFRS 16 in respect on the liability arising on the purchase of the software asset was £0.5m (2022: £0.9m). 


No provision for tax has been made in the period (2022: £Nil) due to the available tax losses carried forward of £6.9m. 

No asset has been recognised in relation to the recovery of these tax losses. The forecast revenues and profits in the business have reduced materially in the last year and as a result it is not now expected that they will all be utilised in the foreseeable future. As a result, the asset of £3.2m held on the prior year balance sheet has now been written off to the income statement in the current period.  

Earnings per share  

Loss per share was 24.6 pence (2022: loss per share 5.6 pence).  


The retained earnings position of the Group is insufficient for the Board to consider a dividend for the year. In any event, the Group is primarily seeking to achieve capital growth for shareholders rather than an income. It is the board’s intention during the current phase of the Group’s development to retain any distributable profits that arise from the business to the extent they are generated.  

Balance sheet 

The Group’s balance sheet position showed a net deficit at 31 December 2023 of £13.4m (2022: net assets of £8.5m).  

Fixed assets 

Intangible assets 

The intangible asset of £2.9m (FY22: £14.5m) arises from the recognition of long term right-of-use software assets and the capitalisation of £0.5m of research and development. The amortisation associated with the software asset was £12.0m (FY22: £2.4m). 

Management has accelerated the amortisation to reflect the reduced utility of the software asset following the reduced level of design anticipated over the remaining life of the asset. Since the end of 2023, the terms of the right-of-use software asset have been renegotiated allowing the business to recover the lost utility over an extended period of use.

Tangible assets 

Tangible assets of £0.5m (FY22: £0.9m) comprise mainly of right-of-use assets relating to office leases and other office equipment.

Cash flow and net debt 

At 31 December 2023 the cash balance was £0.0m (2022: £4.4m).   

The Group repaid its shareholder loan of £0.7m during the year but drew down a short-term loan by way of advance against expected R&D tax credit receipts of £0.9m, leaving a net debt position of £1.0m (2022: Net cash £3.7m). 

Risks and uncertainties 

The Board continually assesses and monitors the key risks of the business. The key risks that could affect the Group’s performance, and the factors that mitigate these risks, are set out on pages 10 to 12 of the 2023 annual report and accounts. 


Nick Stone
Interim Chief Financial Officer
17 July 2024

1 Costs relating to the IPO in the prior year which are not considered to be trading expenditure  

Consolidated Statement of Profit and Loss and Other Comprehensive Income

For the year ended 31 December 2023

  2023  2022
    as restated
 Note £  £
Revenue 69,425,753 17,277,631
Cost of sales (21,759,584) (15,664,557)
Gross (loss)/profit (12,333,831) 1,613,074
Administrative expenses (6,525,540) (7,814,885)
Other operating income101,536,129 965,655
Operating loss10(17,323,242) (5,236,156)
Finance costs11(655,797) (1,175,510)
Finance income12305 30
Loss before tax (17,978,734) (6,411,636)
Tax (charge)/credit13(3,541,379) 3,219,735
Loss for the year attributable to the owners of the parent  (21,520,113)  (3,191,901)
Other comprehensive income/(expense)    
Items that may be reclassified to profit and loss in subsequent periods (net of tax):    
Exchange differences on translation of foreign operations  22,268  (39,079)
Other comprehensive income/(expense) for the year
(net of tax)
 22,268  (39,079)
Total comprehensive expense for the year attributable to the owners of the parent (21,497,845)  (3,230,980)
Losses per share attributable to the owners of the parent     
Basic 14 (0.25)  (0.06)
Diluted 14 (0.25)  (0.06)

All activity in both the current and the prior year relates to continuing operations.

The notes form part of the consolidated financial statements.

Consolidated Statement of Financial Position

As at 31 December 2023

  2023 2022
   as restated
 Note£ £
Non-current assets     
Property, plant and equipment 15 339,965  293,914
Right-of-use assets 16 502,567  637,100
Intangible assets 17 2,938,841  14,547,870
Deferred tax assets 21 -  3,199,744
Total non-current assets  3,781,373  18,678,628
Current assets     
Inventories 18 -  1,044,069
Trade and other receivables 19 2,181,558  10,197,124
Cash and cash equivalents 20 2,146  4,449,812
Income tax receivable  735,488  149,853
Total current assets  2,919,192  15,840,858
Total assets  6,700,565  34,519,486
Current liabilities     
Trade and other payables 22 5,701,773  10,162,935
Short-term borrowings 23 859,800  -
Short-term lease liabilities 24 8,086,429  4,805,956
Total current liabilities
 14,648,002  14,968,891
Non-current liabilities
Borrowings 23 -  700,000
Lease liabilities 24 5,378,108  10,292,172
Deferred tax liabilities 21 28,414  74,933
Total non-current liabilities  5,406,522  11,067,105
Total liabilities  20,054,524  26,035,996
Net (liabilities)/assets  (13,353,959)  8,483,490
Issued share capital27 87,462  87,462
Share premium28 18,286,562  18,286,562
Foreign currency translation reserve28 (33,329)  (55,597)
Share-based payment reserve28 470,656  812,676
Retained deficit28 (32,165,310)  (10,647,613)
Total equity  (13,353,959)  8,483,490


The consolidated financial statements were approved and authorised for issue by the Board on 17 July 2024 and were signed on its behalf by:

David Mitchard 
Non-Executive Chairman and Interim Chief Executive Officer

The notes form part of the consolidated financial statements.

Consolidated Statement of Changes in Equity

For the year ended 31 December 2023

Foreign currency
translation reserve
payment reserve

Balance at 1 January 2022  8,345 122,431 (16,518) 1,236,397 (7,927,194) (6,576,539)
Loss for the year  - - - - (3,191,901) (3,191,901)
Other comprehensive expense  - - (39,079) - - (39,079)
Total comprehensive expense for the year  - - (39,079) - (3,191,901) (3,230,980)
Share issues 27 36,364 18,164,131 - - - 18,200,495
Exercise of share options 26 1,029 - - (513,206) 513,206 1,029
Bonus issues 27 41,724 - - - (41,724) -
Share-based payment charge 26 - - - 89,485 - 89,485
Total transactions with owners  79,117 18,164,131 - (423,721) 471,482 18,291,009
At 31 December 2022  87,46218,286,562(55,597)812,676 (10,647,613)8,483,490
Loss for the year  - - - - (21,520,113) (21,520,113)
Other comprehensive income  - - 22,268 - - 22,268
Total comprehensive income/(expense) for the year  - - 22,268 - (21,520,113) (21,497,845)


Share-based payment (credit)/charge 26 - - - (342,020) 2,416 (339,604)
Total transactions with owners  - - - (342,020) 2,416 (339,604)
At 31 December 2023  87,462 18,286,562 (33,329) 470,656 (32,165,310) (13,353,959)


The notes form part of these consolidated financial statements.

Consolidated Statement of Cash Flows

For the year ended 31 December 2023










as restated










Cash used in operations








Tax received








Net cash outflow from operating activities









Cash flows from investing activities




Purchase of property, plant and equipment





Purchase of intangible assets





Interest received









Net cash outflow from investing activities









Cash flows from financing activities




Proceeds from issue of share capital





Proceeds from exercise of share options





Proceeds from borrowings





Repayment of borrowings





Payment of principal portion of lease liabilities





Interest paid on lease liabilities





Other interest paid









Net cash (outflow)/inflow from financing activities









Net (decrease)/increase in cash and cash equivalents









Cash and cash equivalents at the beginning of the financial year





Foreign exchange differences on cash balances









Cash and cash equivalents at the end of the financial year









The notes form part of the consolidated financial statements.