Science Group plc (the ‘Company’) together with its subsidiaries (‘Science Group’ or the ‘Group’) reports its audited results for the year ended 31 December 2023.

  • Group revenue increased to £113.3 million (2022: £86.3 million), including contribution from TP Group acquired in January 2023
  • Adjusted* operating profit increased to £20.5 million (2022: £17.6 million)
  • Adjusted* basic earnings per share increased to 33.3 pence (2022: 29.4 pence)
  • Dividend proposed to increase by 60% to 8.0 pence (2022: 5.0 pence), reflecting the significant increase in scale of the Group in recent years
  • Share buy-back of £3.9 million in 2023 at an average price of 403 pence (2022: £1.3 million at average 408 pence). Programme anticipated to continue in 2024
  • Year-end cash of £30.9 million with net funds of £18.0 million (2022: £43.6 million and £29.5 million, respectively) after completion of the TP Group acquisition and share buy-back. Additional undrawn credit facility of £25.0 million


Science Group plc

Martyn Ratcliffe, Executive Chair

Jon Brett, Finance Director

Tel: +44 (0) 1223 875 200


Stifel Nicolaus Europe Limited (Nominated Adviser and Joint Broker)

Nick Adams, Fred Walsh, Richard Short

Tel: +44 (0) 20 7710 7600


Liberum Capital Limited (Joint Broker)

Max Jones, Miquela Bezuidenhoudt

Tel: +44 (0) 20 3100 2000


* Alternative performance measures are provided in order to reflect the underlying financial performance of the Group. Refer to Note 1 for detail and explanation of the measures used.



Statement of Executive Chair


Science Group plc is an international science & technology consultancy and systems organisation. The Group’s operating businesses are supported by a scalable corporate and shared services infrastructure and underpinned by a robust balance sheet including significant cash resources and freehold property assets.

Since 2010, the Group has established a strong operating track record, enhanced by a successful M&A strategy, delivering consistent performance through economic volatility, the pandemic and geo-political instability. In 2023, Science Group again demonstrated the effectiveness of its operating model in a challenging macro-environment and, whilst not immune to market dynamics, the Group has reported record underlying operating results.

Financial Summary

For the year ended 31 December 2023, Science Group reported revenue of £113.3 million (2022: £86.3 million). Adjusted operating profit increased to £20.5 million (2022: £17.6 million) and adjusted basic earnings per share increased to 33.3 pence (2022: 29.4 pence). Consistent with the Board’s emphasis on cash flow, the Group does not capitalise R&D costs although certain investments, of between £1.0 million and £1.5 million, could have been considered appropriate for capitalisation.

Adjusting items, which are primarily non-cash, are detailed in the Finance Director’s report and include one-off items related to the TP Group (‘TPG’) acquisition (completed in January 2023). Accordingly, the Group’s reported statutory operating profit was £8.1 million for the year (2022: £11.7 million) and profit before tax was £7.6 million (2022: £11.1 million). The Group also incurred a higher tax charge, impacting statutory post-tax profit and basic earnings per share.

Science Group retains an asset-rich balance sheet, including significant cash resources and freehold property. Despite completing the Group’s largest acquisition in January 2023 (cash outflow in the year of approximately £13.9 million) and a substantial share buy-back programme (cash outflow of £3.9 million), at 31 December 2023 Group cash was £30.9 million (2022: £43.6 million) and net funds were £18.0 million (2022: £29.5 million). The Group’s term loan, which expires in 2026, was £13.0 million (2022: £14.1 million) in addition to which the Group has an undrawn £25 million Revolving Credit Facility (‘RCF’) which has been extended to December 2026.

Consultancy Services

The nucleus of Science Group is an international science and technology consultancy, providing technical/scientific advisory, product development and regulatory services to the Industrial, Defence & Aerospace, Medical and Consumer (including Food & Beverage) sectors. The deep technical and scientific expertise combined with specialist industry knowledge defines the strategy of Science Group’s Consultancy operations.

The Consultancy Division comprises distinct practices, characterised by capability, geography or industry sector. Whilst operating autonomously, these practices have tangible synergies and collaboration is actively developed, supported by common incentive programmes, to realise the benefits of scale. For example, a substantial proportion of projects in 2023 addressed sustainability objectives of Science Group clients achieved through multi-disciplinary teams.

The completion of the acquisition of TPG in January 2023 expanded the Group’s addressable market with the addition of Defence and Aerospace focused consultancy services (‘TPGS’), while also opening up new opportunities for the Group’s existing capabilities. Like most market sectors, Defence and Aerospace has high barriers to entry, requiring an understanding of the market characteristics, processes and dynamics.

For the year ended 31 December 2023, the Consultancy Services operations generated revenue of £81.3 million (2022: £60.7 million), including eleven months of TPGS producing an adjusted operating profit increase to £20.4 million (2022: £16.2 million). The established operations within the Division deliver consistently high margins, reflecting the market positioning of Science Group and an efficient operating model, but the margin overall in 2023 reduced due to the currently lower profitability of TPGS.

While the TPGS integration increased the proportion of Consultancy revenue derived from the UK, the Consultancy Division remains internationally diversified with around 30% of revenues invoiced in US dollars in addition to other currencies.  Given the proportion of revenue invoiced in US dollars, against a primarily Sterling cost base, the Board initiated a currency hedging option for a proportion of the Consultancy cash flows in 2023 and a similar instrument has been adopted for 2024.

Systems Businesses

The Group has two systems businesses, both of which have leading positions in their niche markets. These ‘satellites’ operate independently but are supported by the Group’s corporate and shared services infrastructure and have access to the Consultancy Division’s science, technology and engineering expertise providing R&D breadth and depth far beyond what would typically be available to operations of their scale. In aggregate, for the year ended 31 December 2023, the Systems businesses reported revenue of £31.2 million (2022: £25.0 million) and an adjusted operating profit of £2.2 million (2022: £3.9 million).

Submarine Atmosphere Management Systems (CMS2) was part of TP Group and required considerable attention following Science Group’s initial investment in 2021. This focus has continued after the acquisition was completed in 2023, including strengthening management, improving operational/commercial process/governance and R&D support. While servicing an international client base, the systems are of a highly bespoke nature and the business remains dependent on the UK defence market. For the eleven months ended 31 December 2023, CMS2 reported revenue of £21.3 million (2022: £nil) of which added-value and services contribute around 60%. The adjusted operating margin in 2023 was higher than anticipated, benefitting from some one-off effects.

Audio Chips and Modules (Frontier) is the global market leader in DAB/DAB+/Smart Radio chips and modules and is developing new-technology connected audio products. In line with the broader consumer electronics market, the economic downturn, compounded by overstocking in the distribution channel related to the post-Covid supply chain imbalances, impacted the Frontier business in 2023. As a result, revenue reduced to £10.0 million (2022: £25.0 million) with a small operating loss, although this included significant investment in new product development, all of which was expensed in the year with no capitalisation of R&D. Despite the challenging market conditions, Frontier is believed to have retained its substantial market share and premium positioning and the Board anticipates the business will see a recovery in 2024, benefitting from wider market/economic dynamics and the operational cost reduction actions undertaken during the past year.


The corporate function is responsible for the strategic development and governance of Science Group. The underlying costs of the corporate function were static at £2.6 million (2022: £2.6 million). Total corporate costs additionally include one-off items associated with acquisitions and therefore are reported as £8.1 million (2022: £3.2 million). These primarily non-cash adjusting items are detailed in the Finance Director’s report.

During the year, the Company repurchased 961,385 shares at a total cost of £3.9 million (2022: £1.3 million), equivalent to an average price of 403 pence per share. At 31 December 2023, shares in issue (excluding treasury shares held of 0.7 million) were 45.5 million (2022: 45.4 million excluding treasury shares held of 0.7 million). The Board anticipates continuing the buy-back programme in 2024, as appropriate.

Reflecting the significant increase in the scale of Science Group in recent years, together with the track record of performance, the Board is recommending increasing the dividend by 60% to 8.0 pence per share (2022: 5.0 pence per share).  Subject to shareholder approval at the Annual General Meeting (‘AGM’), the dividend will be payable on 19 July 2024 to shareholders on the register at the close of business on 21 June 2024.

Science Group owns two freehold properties, Harston Mill, near Cambridge, and Great Burgh, near Epsom, the primary function of which is to host the Group’s operating businesses. The Group charges market rents to the operating businesses and lets out part of the Harston Mill site to third parties. For the year ended 31 December 2023, the rental and associated services income derived from this activity was £4.2 million (2022: £4.1 million), of which around 20% is generated from third party tenants.  Intra-group rental charges are eliminated on Group consolidation. The last independent valuation of the freehold properties (December 2023) indicated an aggregate value in the range of £16.9 million to £31.6 million, although for consistency the properties are held on the balance sheet on a cost basis of £20.6 million (2022: £20.8 million).

Environmental Reporting

In 2023 the Group undertook Streamlined Energy and Carbon Reporting (SECR) for the first time and is reporting Scope 1, 2 and mandatory Scope 3 emissions from its UK operations. The Group is also disclosing climate-related risk in line with the Task Force on Climate-Related Financial Disclosures (TCFD) framework. For the latter initiative, the Group worked with a specialist third-party consultancy, and concluded that the Group’s exposure to climate-related risk is low.

Summary and Outlook

In summary, Science Group has delivered another solid performance in 2023. This resilience has been achieved against the backdrop of significant geopolitical and economic instability which the Board anticipates will persist through the first half of 2024.

The acquisition of TP Group materially increased the scale and expanded the addressable market of Science Group.  The contribution made by the TP Group businesses in 2023 indicates that the acquisition remains on trajectory to meet the Group’s acquisition objectives.

For over a decade, Science Group has demonstrated a consistent operating track record, enhanced by a successful M&A programme, delivering a substantial return for shareholders. While the Group has the ambition and capability to accelerate the strategy, the relative valuation of the company against both UK and international comparators may prove a material constraint. The Board will therefore consider all options to address this disparity and deliver value to shareholders.


Martyn Ratcliffe

Executive Chair



Finance Director’s Report

Overview of Results


In the year ended 31 December 2023, the Group generated revenue of £113.3 million (2022: £86.3 million).  Revenue from the Consultancy Services Segment, that is revenue derived from consultancy services and materials recharged on projects, increased to £81.3 million (2022: £60.7 million) while Systems revenue generated by the CMS2 Business was £21.3 million (2022: £nil) and Systems revenue generated by the Frontier Business was £10.0 million (2022: £25.0 million). Revenue generated by freehold properties, comprising property and associated services income derived from space let to third parties in the Harston Mill facility, was £0.8 million (2022: £0.7 million).

Adjusted operating profit for the Group increased to £20.5 million (2022: £17.6 million). There were one-off adjusting items related to the TP Group plc (‘TPG’) acquisition, which completed on 26 January 2023, totalling £5.5 million (2022: £0.5 million). The majority of these were non-cash and included items such as: share of loss for the period held as an associate; remeasurement of share valuation at point of acquisition (in accordance with IFRS 3 Business Combinations); professional fees; and integration/restructuring. In addition, and driven by the acquisition of TPG, amortisation of acquisition-related intangible assets increased to £4.9 million (2022: £3.8 million). Share-based payment charges for the year totalled £2.0 million (2022: £1.6 million), which resulted in statutory profit before tax of £7.6 million (2022: £11.1 million). After net finance costs of £0.5 million (2022: £0.6 million) and a tax charge of £2.1 million (2022: £0.5 million), statutory profit after tax was £5.5 million (2022: £10.6 million). Statutory basic earnings per share was 12.1 pence (2022: 23.2 pence per share).

Adjusted operating profit is an alternative profit measure that is calculated as operating profit excluding acquisition integration costs, amortisation of acquisition related intangible assets, share based payment charges, and other specified items that meet the criteria to be adjusted. Refer to the notes to the financial statements for further information on this and other alternative performance measures.

TP Group plc (‘TPG’)

 Prior to 2023, through on-market purchases of shares, the Group had acquired an associate shareholding in TPG. A full acquisition was completed through a court-approved Scheme of Arrangement on 26 January 2023, at which point TPG became a 100% subsidiary of the Group. 

As well as providing an entry into the defence sector, the acquisition of TPG has significantly increased the scale of Science Group. In 2023, the TPG trading entities contributed £44.9 million towards Group revenue.

Foreign Exchange

The acquisition of TPG, where revenue is denominated in Sterling, has reduced the Group’s overall exposure to foreign exchange, however, there remains a reasonable proportion of the Group’s revenue denominated in currencies other than Sterling. In 2023, £34.6 million of the Group’s operating business revenue was denominated in US Dollars (2022: £54.7 million), including all of Frontier’s revenue. In addition, £3.9 million of the Group operating business revenue was denominated in Euros (2022: £2.7 million). The average exchange rates during 2023 were 1.24 for US Dollars and 1.15 for Euros (2022: 1.24 and 1.18 respectively).

In 2022, to provide greater forward visibility around foreign exchange, the Group acquired a currency exchange instrument to cap the Sterling:US Dollar rate in relation to certain consultancy cash flows through to the end of 2023. The instrument applied to $1.25 million per month at an exchange rate of $1.20/£1, whilst still allowing the business to benefit from lower spot exchange rates if available. A similar no obligation cap has been put in place through 2024 for $1.0 million per month at an exchange rate of $1.25/£1.


The tax charge for the year was £2.1 million (2022: £0.5 million). The increase is partly explained by tax at a higher rate, with the UK corporation tax rate increasing from 19% to 25% in April 2023.  However, as a comparative, the 2022 tax charge was exceptionally low due to deferred tax and some over accrual in 2021.

At 31 December 2023, Science Group had £29.3 million (2022: £26.7 million) of tax losses, the largest components of which related to Frontier (£19.2 million (2022: £17.1 million)) and TPG (£5.9 million (2022: £nil)). £9.1 million (2022: £8.7 million) of the Frontier losses, and £5.4 million (2022: £nil) of the TPG losses are recognised as deferred tax assets which are anticipated to be used to offset future taxable profits. The balances of £10.1 million (2022: £8.4 million) of the Frontier losses and £0.5 million (2022: £nil) of the TPG losses have not been recognised as deferred tax assets due to the uncertainty in the timing of utilisation of these losses.  Aside from these amounts, the Group has other tax losses of £4.2 million (2022: £9.6 million) unrecognised as a deferred tax asset due to the low probability that these losses will be utilised.

Financing and Cash

Cash flow from operating activities (excluding Client Registration Funds) was £8.9 million (2022: £15.3 million). Reported cash from operating activities in accordance with IFRS was £7.9 million (2022: £15.3 million). The difference in these two metrics relates to the fact that one of the Group’s businesses, TSG, processes regulatory registration payments on behalf of clients. The alternative performance measure, by excluding Client Registration Funds, reflects the Group’s available cash position and cash flow.

The Group’s term loan with Lloyds Bank plc, secured on the Group’s freehold properties, is a 10-year fixed term loan expiring in 2026. Phased interest rate swaps hedge the loan resulting in a fixed effective interest rate of 3.5%, comprising: a margin over the Sterling Overnight Index Average (‘SONIA’); the cost of the loan arrangement fee; and, the cost of the swap instruments. The Group has adopted hedge accounting for the interest rate swaps related to the bank loan under IFRS 9, Financial Instruments, and the change in fair value of the interest rate swaps was recognised in Other Comprehensive Income (2023: a loss of £0.5 million, 2022: a gain of £1.3 million).

In December 2021, in addition to the term loan, the Group signed a £25.0 million revolving credit facility (‘RCF’) with Lloyds Bank plc in order to provide additional capital resources to enable the execution of the Group’s acquisition strategy. The RCF is for up to £25.0 million, with an additional £5.0 million accordion option. The agreement was initially for a 4-year term with an optional 1-year extension which was activated in December 2023, so the term now runs to December 2026. The margin on drawn sums is 3.3% over SONIA and is 1.1% per annum on undrawn amounts. Drawn amounts are secured on the Group’s assets by debentures. At 31 December 2023, the RCF remained undrawn.

The RCF has two financial covenants with which the Group needs to comply if the facility is drawn: (i) the Group’s net leverage, as defined as the net debt divided by the rolling 12 month EBITDA, should not exceed 2.5; and (ii) the Group’s interest cover, as defined as the rolling 12 month EBITDA divided by the rolling interest payments on all borrowings, should not be less than 4.0.  Reporting is on a 6 monthly basis unless the net leverage exceeds 2, in which case reporting moves to quarterly until net leverage returns to below 2 again. For the term of the RCF, the previous covenants for the term loan are superseded by the covenants of the RCF and will not apply.

The Group cash balance (excluding Client Registration Funds) at 31 December 2023 was £30.9 million (2022: £43.6 million) and net funds were £18.0 million (2022: £29.5 million). Client Registration Funds of £1.9 million (2022: £2.9 million) were held at the year end. Working capital was partly impacted by the TPG acquisition, together with some one-off project prepayments received at the end of 2022, which have since normalised. Working capital management during the year continued to be a focus with debtor days of 40 days at 31 December 2023 (2022: 43 days) and inventory days of 121 days (2022: 197 days).

Share Capital

At 31 December 2023, the Company had 45,458,972 ordinary shares in issue (2022: 45,436,823) and the Company held an additional 726,902 shares in treasury (2022: 749,051). Of the ordinary shares in issue, no shares are held by the Frontier Employee Benefit Trust (2022: 34,800). The voting rights in the Company at 31 December 2023 are 45,458,972 (2022: 45,402,023). In this report, all references to measures relative to the number of shares in issue exclude shares held in treasury unless explicitly stated to the contrary.


Jon Brett

Finance Director



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