Interim report
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RNS Number : 7518TJourneo PLC08 September 2026 The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended and supplemented from time to time. 8 September 2026 Journeo plc ("Journeo, the "Company" or the "Group") Interim results for the six months ended 30 June 2026 Journeo plc (AIM: JNEO), a leading provider of intelligent systems for transport networks and critical national infrastructure,announces its interim results for the six months ended 30 June 2026 ("H1 2026"). Financial headlines · Group revenue increased 53% to £37.6m (H1 2025: £24.5m)· Gross profit increased 57% to £14.5m ( H1 2025: £9.2m)· Adjusted profit before tax increased 10% to £3.0m (H1 2025: £2.8m)· Diluted earnings per share increased 9% to 13.60p (H1 2025: 12.51p).· Cash and cash equivalents at 30 June 2026 were £12.6m (H1 2025: £18.0m) following £10.7m acquisition ofCrime and Fire Defence Systems in September 2025· Sales opportunity pipeline increased to £200m (H1 2025: £80m) Operational headlines · Continued the integration of acquired businesses into the Group structure · Identified new operational headquarters for our Infrastructure Protection segment· Strengthened senior team with new service delivery leaders for our Information Systems and Integrated Services segments· Successfully initiated trials of agentic AI software development, demonstratively increasing the cadence of our development cycle Russ Singleton, CEO of Journeo plc, said: "I am pleased to report another record first-half performance, with growth in bothrevenue and profit, reflecting continued progress across the Group. With a strong financial position and a £200 million salesopportunity pipeline, we have a clear platform for growth in attractive transport and critical infrastructure markets." A digital copy of this announcement is available on the Group's website:www.journeo.com For further information, please contact: Journeo plcRuss Singleton/ Nick Lowe +44 (0) 203 651 9166 Cavendish Capital Markets Limited - Nominated Adviser and Broker Callum Davidson/Isaac Hooper +44 (0) 207 220 0500 Notes to editors: Journeo plc is a leading Intelligent Systems provider, delivering sustainable solutions in towns, cities, airports, and the publictransport networks that connect them while safeguarding critical infrastructure and high-security environments withadvanced access control, intrusion detection, and surveillance technologies. Through the Group's six operating companies, it addresses three key market segments: · Information systems:The design, manufacture installation and support of passenger information display solutionsfor bus and rail applications at key stations, interchanges and the transport networks that connect them. Solutionsare managed through powerful content management systems.
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· Infrastructure protection:Advanced solutions for the protection of Critical National Infrastructure sites includingutilities, defence and high security industrial and commercial applications.· Integrated services:The design, delivery and maintenance of complex solutions to the on-vehicle transportationmarket, including advanced CCTV video surveillance to improve passenger and driver safety, telematics for vehicleand driver performance monitoring, real-time communications for remote condition monitoring and automaticpassenger counting, underpinned by the Group's SaaS solutions. In the last four years, the Company has invested over £8 million in research and development, enabling it to design andsupply powerful innovative solutions for customers' complex requirements. With an Internet of Things ("IoT") approach andopen standards, together with field-proven and reliable engineering, Journeo is able to offer flexible, scalable products andservices that can integrate with existing technology while preparing for future advancements. Chairman and Chief Executive's review Overview The Board is pleased to report another period of strong progress for the six months ended 30 June 2026 ("H1 2026"), withrecord revenue, gross profit and profit before taxation. Revenue increased by 53% to £37.6m (H1 2025: £24.5m), reflecting a combination of organic growth and the contributionfrom acquisitions. Underlying profit increased by 16% to £3.0m (H1 2025: £2.6m). The Group continues to perform strongly during challenging market and supply chain conditions, adapting its sales mix inresponse to changing customer needs. This resilience reflects the flexibility and agility of Journeo's core technology, togetherwith the strength of its long-standing customer relationships. During the period, we made further progress in developing Journeo around three core areas: Information Systems,Infrastructure Protection and Integrated Services. Together, these provide the Group with exposure to attractive transportand critical-infrastructure markets in the UK and internationally, where our domain expertise, technology, engineeringcapability and customer relationships create barriers to entry. The Board's medium-term ambition is to grow Journeo beyond £150 million in annual revenue, through a combination oforganic growth and disciplined M&A, while maintaining strong margins, robust risk management and continued investmentin our people, systems and intellectual property. With a strong financial foundation, clear direction and a sales opportunitypipeline of £200 million (H1 2025: £80m), Journeo is well positioned to deliver long-term sustainable value. Strategic progress As Journeo continues to evolve, we have refined how we describe the Group's activities around three key areas: · Information Systems: Visual display of transit information and infotainment · Infrastructure Protection: Safety-focused physical and cyber security of critical infrastructure · Integrated Services: Packaged solutions combining software, hardware, and services, supported 24/7 Our strategy remains centred on working closely with customers to develop a deep understanding of their current and futurerequirements. This enables Journeo to apply its domain expertise, adaptable IP and engineering capability to complexoperational challenges, building market share within defensible niches and contributing to the strong organic growth of theGroup. We made progress strengthening the Group's operational structure during the period. We are bringing our InfrastructureProtection activities together within a new regional headquarters, while Heads of Service have been introduced acrossIntegrated Services and Information Systems. These appointments strengthen the depth of our day-to-day operationalmanagement, enhance the customer experience and provide additional capacity to support the Group's continued growth. Continued investment in research and development remains an important element of the Group's strategy, with more than£10m invested over the last five years. We commenced a number of trials of agentic AI software-development tools. Initial results have been encouraging,increasing the cadence of software releases across our market-leading platforms and demonstrating the potential to improveengineering productivity. As these capabilities develop, they will enable Journeo to address a broader range of opportunities without requiring aproportionate increase in development resources, while retaining the domain expertise and engineering oversight of ourcore teams. The Board continues to execute its M&A strategy and maintains an active and growing pipeline of potential opportunities.Our disciplined approach focuses on businesses where we identify clear strategic alignment through complementarytechnologies, customer markets, capabilities and culture; and where integration into Journeo can accelerate growth andcreate additional shareholder value. Financial results Revenue for H1 2026 increased by 53% to £37.6m (H1 2025: £24.5m). Gross margin increased to 39% (H1 2025: 38%) resulting in a gross profit increase of 57% to £14.5m (H1 2025: £9.2m). Information Systems revenue of £13.9m (H1 2025: £9.9m) grew by 40%. Information Systems gross profit of £5.3m (H1 2025: £4.7m) increased by £0.6m, following a decrease in gross margin to 38%(H1 2025: 48%). The reduction in margin was due to decreased revenue levels in the UK rail market; and a number of newproduct launches in the half, which have a lower margin on smaller initial build volumes. Margins are expected to improve inH2.
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Infrastructure Protection, which joined the group during H2 2025, produced revenue of £10.6m. Gross margin was strong at45%, delivering a gross profit of £4.8m. Integrated Services revenue decreased by 2% to £14.4m (H1 2025: £14.7m). Gross margins were maintained at 31% (H12025: 31%) resulting in a gross profit of £4.4m (H1 2025: £4.5m). Group underlying profit increased by 16% to £3.0m (H1 2025: £2.6m). The diluted profit per share increased to 13.60p (H1 2025: 12.51p). Cash and cash equivalents at the end of the period decreased to £12.6m (H1 2025: £18.0m)following payment of £10.7mcash consideration for the acquisition of Crime and Fire Defence Systems in September 2025. Operational review Information Systems The Board is pleased with the progress achieved by Information Systems, which delivered revenue of £13.9m in H1 2026 (H12025: £9.9m), representing growth of 40%. Underlying profit increased by 26% to £1.2m (H1 2025: £1.0m), reflecting the strong revenue growth achieved during theperiod. A combination of favourable market conditions and the continued strengthening of Journeo's product offeringunderpinned this result. We expect further improvements to this performance in H2. Significant Government investment through Transport for City Regions allocations, totalling £15.6bn through to 2032,together with Local Transport Grants totalling £2.3bn between 2025 and 2030, is enabling local authorities and transportexecutives to commit to projects designed to improve transport infrastructure. In January, the Group announced £1.6m of purchase orders for hardware, software and maintenance services to enhancereal-time passenger information systems in Cornwall. Cornwall Council, a new customer for Journeo, required a technology partner capable of taking control of existing signageinfrastructure, upgrading it to operate using the latest industry open standards and delivering robust and sustainablesolutions capable of operating in urban, rural and coastal environments. The information estate will include technologycapable of harvesting renewable energy for years to come and operating independently from the power grid. Further purchase orders totalling £1.7m from another large local authority and longstanding Journeo customer in the Southof England were announced in April. The project, for the supply, installation and maintenance of passenger informationdisplays and associated bus-stop infrastructure, will see ultra-low-power displays deployed across key transport corridors. Together, these contracts demonstrate increasing market adoption of the off-grid, solar and battery-powered technologies inwhich Journeo has invested over recent years and highlight the value of developing solutions that address customerrequirements and wider sustainability objectives. The UK Rail market continues to experience a period of transition as Network Rail moves towards the establishment of GreatBritish Railways and future spending priorities are determined. We continue to work closely with our customers as thesechanges take place and have seen encouraging signs of increased activity since the period end, including our September2026 announcement of an initial £1.3m of purchase orders from GTS, who operate the Elizabeth line on behalf of TfL. Activity in the US market remains encouraging. During the period, Outfront Media Group ("OFM") placed US$1.2m ofpurchase orders for display systems for deployment across the Massachusetts Bay Transportation Authority ("MBTA")network in Boston. MBTA is the second major US transit authority with which Journeo has worked, following deployment in the MetropolitanTransportation Authority in New York City. The newly developed display formats have been designed and engineered by the Journeo Design Centre ("JDC") andincorporate high-performance display technologies and embedded systems designed to optimise operational reliability andenable enhanced remote diagnostics. The new displays will be deployed across the MBTA network, which deliversapproximately 880,000 passenger journeys, from 153 subway stations, each weekday. The growing adoption of Journeo technology in the United States represents an important opportunity for the Group anddemonstrates the potential for our IP and engineering capability to address significantly larger international markets. Infrastructure protection Infrastructure Protection delivered revenue of £10.6m and underlying profit of £0.6m during its first full half year within theGroup. The Board is pleased with the progress made during the period, particularly given the development of the business mix andits expansion into adjacent market areas. The new segment specialises in the design, installation and maintenance of integrated security systems for high-security sitesand Critical National Infrastructure, combining specialist engineering capability in highly regulated environments. In March, the Group announced £2.4m of contract awards under a four-year framework with a major UK utility company. The uninterrupted provision of utility services to homes and businesses is fundamental to the operation of the UK economy.The continued trust placed in Journeo to protect critical assets, from system design through installation and commissioning,demonstrates the depth of expertise being developed within the segment. In April a further £1.0m of contract awards were secured under a five-year framework with another major UK utilitycompany.
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The importance of protecting the UK's critical infrastructure continues to increase, supported by greater Government focuson defence, resilience and national security. This is creating a growing requirement for organisations with the specialistengineering, technology and project-management capabilities necessary to protect nationally important assets. Journeo is now well positioned to deploy its expertise across Critical National Infrastructure and Nationally SignificantInfrastructure Projects, maintaining the high standards of delivery, security and operational performance expected by itscustomers. The integration and development of Infrastructure Protection remains an important component of the Group's strategy. Inaddition to contributing revenue and profit, the segment broadens Journeo's addressable markets and introducescapabilities that can increasingly be applied across the wider Group. Integrated services Integrated Services generated H1 2026 revenue of £14.4m (H1 2025: £14.7m), a reduction of 2%. Delays in new bus orders,together with some supply-chain challenges, resulted in revenue being deferred into H2 2026. With activity now increasing,the Board expects the segment to deliver an improved performance during the second half. In March, the Group announced a strategically important award of DKK5.5m, approximately £0.6m, for the first widescale on-train system in Northern Europe secured by Journeo. Delivered through Journeo AS, our Danish subsidiary, the project brings together expertise from across the Group to supplyand install modern, easy-to-read LED display technology across Danske Statsbaner's ("DSB") fleet of double-deck rail coaches. Work for Denmark's largest state-owned passenger rail operator commences in H2 2026 and will be supported from the UK,introducing core Journeo IP into both a new application and a new geographic market and creating an important referenceinstallation for further opportunities in the Nordic rail market. The move towards bus franchising within a number of English Mayoral Combined Authorities is changing the dynamics offleet renewal. This affected the sales mix within Integrated Services and, consequently, segment profitability. Underlyingprofit for H1 2026 was £1.2m (H1 2025: £1.7m), a reduction of 26%. We are, however, beginning to see this trend reverse, with an increasing number of opportunities returning to the market. InJune, the Group announced £1.3m of purchase orders from Metroline Manchester, where Journeo's high-security, scalablecloud-based systems have been adopted across the operator's Transport for Greater Manchester Bee Network franchises.These long-term customer relationships generate recurring revenues while increasing the value and resilience of Journeo'stechnology offering. The wider policy environment for UK bus transport remains supportive. The Government's continued focus on improving theaffordability and accessibility of public transport, including the announced return of the £2 single-bus fare cap from January2027, provides further encouragement for investment in bus services and associated infrastructure. Our powerful and flexible solutions also excel in operationally unique systems such as transfer bussing. We are currentlyworking closely with nuclear power stations and eight airports on existing and upcoming projects. Outlook Journeo is on track to deliver another record set of full-year results, in line with market expectations. The Group has entered the second half with a strong financial position and a sales opportunity pipeline of £200m,significantly increased from £80m at H1 2025. The investments we continue to make in our IP, people and systems are delivering tangible benefits for customers, increasingour capacity and supporting growth across the Group. We expect an improved performance from Integrated Services and Information Systems in H2, alongside continued progresswithin Infrastructure Protection. The Group remains operationally cash generative and ended the period with cash of £12.6m (H1 2025: £18.0m), followingthe payment of £10.7m of cash consideration for the acquisition of CFDS in September 2025. This financial strength provides the Group with the capacity to continue investing organically while pursuing selective M&Awhere the Board believes it can create additional shareholder value. Mark Elliott Non-executive Chairman Russ Singleton Chief Executive Consolidated statement of comprehensive incomefor the six months ended 30 June 2026 Unaudited sixmonths ended 30June 2026£'000 Unaudited sixmonths ended 30June 2025£'000 Year ended 31December 2025£'000Revenue (notes 4,5) 37,567 24,525 55,022 Cost of sales (23,051) (15,293) (33,221) Gross profit 14,516 9,232 21,801 Underlying administrative expenses (11,500) (6,621) (16,003) Underlying profit 3,016 2,611 5,798 Share-based payments (73) (72) (146)
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Acquisition costs - - (255) Total administrative expenses and other income (11,573) (6,693) (16,404) Operating profit 2,943 2,539 5,397 Net Finance income 13 147 202 Profit before taxation 2,956 2,686 5,599 Taxation charge (508) (447) (1,445) Profit for the period being total comprehensive profitattributable to owners of parent 2,448 2,239 4,154Profit per share (note 6) Basic 13.85p 13.01p 24.30p Diluted 13.60p 12.51p 23.83p Consolidated statement of changes in equity shareholders' fundsfor the six months ended 30 June 2026 Share capital£'000 Sharepremium£'000 Retainedearnings£'000 Total equityshareholders'funds£'000 Balance as at 1 January 2025 6,753 8,266 2,299 17,318 Profit and total comprehensive income for the period - - 2,239 2,239 Proceeds from issue of new shares 32 51 - 83 Share-based payments - - 72 72 Balance at 30 June 2025 6,785 8,317 4,610 19,712 Balance at 1 January 2025 6,753 8,266 2,299 17,318 Profit and total comprehensive income for the year - - 4,154 4,154 Proceeds from issue of new shares 78 1,280 - 1,358 Share-based payments - - 146 146 Balance at 31 December 2025 6,831 9,546 6,599 22,976 Profit and total comprehensive income for the period - - 2,448 2,448 Share-based payments - - 73 73 Balance at 30 June 2026 6,831 9,546 9,120 25,497 Consolidated statement of financial positionat 30 June 2026 Unaudited 30June 2026£'000 Unaudited 30June 2025£'000 31 December2025£'000Assets Non-current assets Goodwill (note 7) 13,033 4,058 13,033 Other intangible assets 4,110 2,663 4,142 Property, plant and equipment 2,398 1,381 2,662 Deferred Tax asset 239 243 136 Trade and other receivables 38 39 39 19,818 8,384 20,012 Current assets Inventories 8,043 6,920 7,957 Trade and other receivables 16,672 9,302 13,421 Cash and cash equivalents 12,627 18,010 12,029 37,342 34,232 33,407 Total assets 57,160 42,616 53,419 Equity and liabilities Shareholders' equity Share capital 6,831 6,785 6,831 Share premium account 9,546 8,317 9,546 Retained earnings 9,120 4,610 6,599 Total equity 25,497 19,712 22,976 Non-current liabilities Deferred revenue 5,013 4,354 4,391 Other payables 1,000 - 1,000 Loans and borrowings 86 80 112 Deferred tax liability 1,049 319 997 Lease liabilities 793 608 1,056 Provisions 1,262 1,508 1,123 9,203 6,869 8,679
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Current liabilities Trade and other payables 10,936 6,725 11,996 Deferred revenue 10,031 8,078 8,604 Loans and borrowings 62 72 62 Lease liabilities 689 293 472 Provisions 742 867 660 22,460 16,035 21,764 Total equity and liabilities 57,160 42,616 53,419 Consolidated statement of cash flowsfor the six months ended 30 June 2026 Unauditedsix monthsended 30June 2026£'000 Unauditedsix monthsended 30June 2025£'000 Year ended 31December2025£'000Net cash from operating activities (note 8) 1,657 4,397 8,216 Cash flows from investing activities Purchases of property, plant and equipment (75) (69) (247) Purchases/generation of intangible assets (628) (485) (1,079) Acquisition costs - - (255) Net cash outflow on acquisitions - - (9,793) Net cash from investing activities (703) (554) (11,374) Financing activities Cash flow from financing activities - - 70 Principal element of lease repayments (329) (165) (435) Issue of shares - 83 1,358 Repayment of loans (27) (69) (113) Net cash from financing activities (356) (151) 880 Net increase/(decrease) in cash and cash equivalents 598 3,692 (2,278) Cash and cash equivalents at beginning of period 12,029 14,318 14,318 Effect of foreign exchange rate changes - - (11) Cash and cash equivalents at end of period 12,627 18,010 12,029 Notes to the interim financial statementsfor the six months ended 30 June 2026 1. Basis of preparation and approval of interim statement The financial information for the six months ended 30 June 2026 and for the six months ended 30 June 2025 is unaudited. The interim financial statement for the six months to 30 June 2026 does not include all of the information required for fullannual financial statements and should be read in conjunction with the consolidated financial statements for the year ended31 December 2025. The financial information has been prepared on the basis of UK adopted international accounting standards (IFRSs) that theDirectors expect to be applicable as at 31 December 2026. The accounting policies adopted in the preparation of the interim financial statements are consistent with those set out inthe Group's Annual Report and Financial Statements 2025, which were prepared in accordance with IFRSs. This interim financial statement does not comprise statutory accounts within the meaning of Section 435 of the CompaniesAct 2006. Statutory accounts for the year ended 31 December 2025 were approved by the Board on 24 March 2026 anddelivered to the Registrar of Companies. The report of the auditor on those accounts was unqualified, did not contain anemphasis of matter paragraph and did not contain any statement under Section 498(2) or Section 498(3) of the CompaniesAct 2006. AIM-quoted companies are not required to comply with IAS 34 'Interim Financial Reporting' and accordingly the Companyhas not applied this standard in preparing this report. The interim financial statement was approved by the Board of Directors on 8 September 2026. 2. International Financial Reporting Standards The Group follows the standards and interpretations issued by the International Accounting Standards Board (IASB) and theInternational Financial Reporting Interpretations Committee of the IASB and endorsed by the UK that are relevant to itsoperations. 3. Going concern
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The Group's business activities together with factors likely to affect its future development, performance and position wereset out in the Strategic Report and Chairman's Statement of the 2025 Annual Report and the principal risks and uncertaintieswere set out in the Strategic Report. The Directors have reviewed the cash flow forecasts for the period up to and including31 December 2027. Based on the above, the Directors have a reasonable expectation that the Group has adequate resources to continue inoperational existence for the foreseeable future and for at least twelve months from the date of the report. For this reasonthe Directors continue to adopt the going concern basis in preparing the financial statements. 4. Revenue The revenue split between goods and services is: Unauditedsix monthsended 30June 2026£'000 Unauditedsix monthsended 30June 2025£'000 Year ended 31December2025£'000Revenue Goods 32,001 19,352 44,305 Services 5,566 5,173 10,717 37,567 24,525 55,022 Construction contracts included in goods 16,443 4,674 17,209 5. Segmental reporting IFRS 8 requires operating segments to be determined on the basis of those segments whose operating results are regularlyreviewed by the Board of Directors (the Chief Operating Decision Maker as defined by IFRS 8) to make strategic decisions. Unauditedsix monthsended 30June 2026£'000 Unauditedsix monthsended 30June 2025£'000 Year ended 31December2025£'000Revenue Infrastructure Protection 10,611 - 7,352 Information Systems 13,885 9,914 21,186 Integrated Services 14,361 14,717 27,143 Intersegment Sales (1,290) (106) (659) 37,567 24,525 55,022 Gross profit Infrastructure Protection 4,809 - 3,018 Information Systems 5,274 4,713 9,783 Integrated Services 4,433 4,519 9,000 Underlying profit 14,516 9,232 21,801 Infrastructure Protection 622 - 378 Information Systems 1,223 973 2,416 Integrated Services 1,248 1,676 3,240 Central 3,093 2,649 6,034 (77) (38) (236) Underlying profit 3,016 2,611 5,798 Reconciling to profit before interest and tax Underlyingprofit/(loss)£'000 Share-basedpayments£'000 Operatingprofit/(loss)£'000Infrastructure Protection 622 - 622 Information Systems 1,223 (30) 1,193 Integrated Services 1,248 (43) 1,205 3,093 (73) 3,020 Central (77) - (77) Total 3,016 (73) 2,943
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Net assetsNet assets attributed to each business segment represent the net external operating assets of that segment,excluding goodwill, bank balances and borrowings, which are shown as unallocated amounts, together withcentral assets and liabilities. Unauditedsix monthsended 30 June2026£'000 Unauditedsix monthsended 30 June2025£'000 Year ended31 December2025£'000 Assets Infrastructure Protection 7,317 - 6,542 Information Systems 11,275 9,882 10,527 Integrated Services 12,800 10,510 11,208 31,392 20,392 28,277 Goodwill 13,033 4,058 13,033 Cash and borrowings 12,627 18,010 12,029 Unallocated 108 156 80 57,160 42,616 53,419 Liabilities Infrastructure Protection (2,981) - (3,447) Information Systems (18,728) (16,012) (17,846) Integrated Services (7,130) (6,108) (6,560) (28,839) (22,120) (27,853) Cash and borrowings (148) (644) (175) Unallocated (2,676) (140) (2,415) (31,663) (22,904) (30,443) Net assets/(liabilities) Infrastructure Protection 4,336 - 3,095 Information Systems (7,453) (6,130) (7,319) Integrated Services 5,670 4,402 4,648 2,553 (1,728) 424 Goodwill 13,033 4,058 13,033 Cash and borrowings 12,479 17,366 11,854 Unallocated (2,568) 16 (2,335) 25,497 19,712 22,976 6. Profit per Ordinary Share Details of the weighted average number of Ordinary Shares used as the denominator in calculating the basic and dilutedearnings per Ordinary Share are given below: Unauditedsix monthsended 30 June2026£'000 Unauditedsix monthsended 30 June2025£'000 Year ended31 December2025£'000 Basic weighted average number of shares 17,092 16,891 17,092 Dilutive potential Ordinary Shares 339 670 339 17,431 17,561 17,431 7. Goodwill Goodwill acquired in a business combination is allocated at acquisition to the cash-generating unit (CGU) that is expected tobenefit from that business combination. The Group has four CGUs which are its four operating segments, Fleet Systems,Passenger Systems, Journeo Denmark and Infotec. The carrying amount of goodwill has been allocated to the CGUs asfollows: Crime and Fire Defence Systems £'000 Infotec £'000 Journeo Denmark £'000 Passenger Systems £'000 Total £'000 At 1 January 2025 - 2,236 477 1,345 4,058 At 30 June 2025 - 2,236 477 1,345 4,058 Additions 8,975 - - - 8,975 At 31 December 2025 and 1 January 2026 8,975 2,236 477 1,345 13,033 At 30 June 2026 8,975 2,236 477 1,345 13,033
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The Group tests goodwill annually for impairment as at 31 December, or more frequently if there are indications thatgoodwill might be impaired. The recoverable amounts of the CGUs are determined based on a value-in-use calculation which uses cash flow projectionsbased on financial budgets and business plans approved by the Directors covering a five-year period. Cash flows beyond thatperiod have been extrapolated in perpetuity assuming no growth, which the Directors consider to be a conservativeapproach. The key assumptions for the value-in-use calculations are those regarding discount rates and sales forecasts. The discount rates needed to equate the net present value from these cash flows to the carrying value of goodwill arecompared to the required rate of return from the CGU based upon an assessment of the time value of money, prevailinginterest rates and the risks specific to the CGU. If this discount rate is in excess of the required rate of return then it is assumed that no impairment has occurred to the carrying value of goodwill. The discount rates are as follows: Unaudited sixmonthsended 30 June2026% Unaudited sixmonthsended 30 June2025% Year ended31 December2025 % Crime and Fires Defence Systems 13 - 13 Infotec 13 13 13 Journeo Denmark 13 13 13 Passenger 13 13 13 The discount rates used are based on the Board's judgement considering macroeconomic factors and reflecting specific risksin each segment such as the nature of the market served, the concentration of customers, cost profiles and barriers to entry. Passenger Systems, Infotec and Journeo Denmark also have intangible assets, which are considered in the same value-in-usecalculations as goodwill. The Crime and Fire Defence, Passenger Systems, Infotec and Journeo Denmark cash flow projections used to determinevalue-in-use are based upon assumptions of sales, margins and cost bases. Of these assumptions the value-in-use is mostsensitive to the level of sales. Margins are fixed in the forecast based upon past experience; the cost base is similarly basedupon past experience and will vary depending upon the level of sales. In accordance with the requirements of IAS 36, ourvalue-in-use calculations do not include cash flows from restructurings to which the Group is not yet committed. The level of sales is the key assumption used in the cash flow forecast. Sales have been determined by management usingestimates based upon past experience and future performance with reference to market position and the sales pipeline. Themacroeconomic environment has improved and there continues to be an increase in the number and size of contractsavailable. Sensitivity analysis has been performed on the pre-tax discount rates, which shows that a pre-tax discount rate of 17.9%(Crime and Fire), 65.0% (Infotec), 51.3% (Journeo Denmark) or 84.6% (Passenger Systems) would be required in order toeliminate the headroom which exists in these CGUs. The Directors consider that the discount rates used, which are alreadyrisk adjusted to capture the Directors' view of the extent to which each CGU is exposed to macroeconomic factors, representa balanced view. A sensitivity analysis has been performed on the impairment test. The Directors consider that an absolute change in the keysales assumption is possible and a reduction in the sales forecast in 2026 of 5% would result in headroom remaining in thecurrent carrying value of goodwill. If sales forecasts were down 10% across the whole period and overheads remainedunchanged then headroom would still remain. The Directors believe that, based on the sensitivity analysis and stress testing performed, any reasonably possible change inthe key assumptions on which the recoverable amounts are based would not cause the carrying amounts to exceed therecoverable amounts. The value in use for the Group exceeds the carrying value of the assets. In view of this, the Directors consider that no impairment of goodwill or intangible assets is required. 8. Cash generated from operations Unauditedsix monthsended 30 June2026£'000 Unauditedsix monthsended 30 June2025£'000 Year ended31 December2025£'000Profit for the period 2,448 2,239 4,154 Adjustments for: - Finance income (13) (147) (202) - Deferred tax (52) (58) 371 - Depreciation of property, plant and equipment 562 253 640 - Amortisation of intangible fixed assets 665 469 1,009 - Share-based payment expense 73 72 146 - Acquisition costs - - 255
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- Increase/(decrease) in provisions 221 (377) (970) - Foreign exchange rate - - (4) Operating cash flows before movement in working capital 3,904 2,451 5,399 (Increase)/decrease in inventories (86) 336 (435) (Increase)/decrease in receivables (3,251) 2,828 3,286 Increase/(decrease) in payables 709 (1,360) (1,095) Cash inflow from operations 1,276 4,255 7,155 Income taxes received/(paid) 310 (46) 768 Net interest earned 71 188 293 Net cash inflow from operating activities 1,657 4,397 8,216 - Ends - This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authorityto act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this informationmay apply. For further information, please contact rns@lseg.com or visit www.rns.com. RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the informationcontained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. Forfurther information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy. END