IQGeo Group plc(the "Company" or the "Group")Interim results for the six months ended 30 June 2020
Continued success in orders and revenue growth
IQGeo Group plc (AIM: IQG), a market leading provider of geospatial productivity and collaboration software for thetelecoms and utility network operators, is pleased to announce its interim results for the six months ended 30 June 2020.

IQGeo (myWorld) operational highlights:
Continued success of subscription model with over 90% of orders taken as multi-year subscriptions
Continued addition of new customers with three new logos secured in H1Successful expansion of 2019 logos with two significant follow-on orders taken in 2020
Effective cost controls to preserve cash balance and to preserve organisational skill set
Group financial highlights:Order bookings related to IQGeo products increased by over 120% to £5.5 million (H1 2019: £2.5 million)
Total revenue from IQGeo products increased by over 50% to £3.6 million (H1 2019: £2.4 million)
Recurring IQGeo product revenue increased by over 170% to £1.6 million (H1 2019: £0.6 million)Gross margin % increased to 51% (H1 2019: 34%)
Net cash balance of £11.2 million as at 30 June 2020 (31 December 2019: £13.1 million, 30 June 2019: £26.0
million).
Outlook:
Our customer’s end markets have remained resilient during the pandemic as work from home policies
encourage consumption of broadband, 5G and utilities.

Annual Contracted Value including M&S is £2.9 million (H1 2019: £1.6 million, 2019: £2.0 million) reflecting thecompany’s success in converting its business model to a subscription basis.

Expect continued progress in H2 thanks to continued focus on digital marketing and lead generation strategy
alongside our customers’ investment in network infrastructure and productivity enhancing initiatives.

Full year cash outflow will show material improvements compared to 2019 as the base of subscription revenues
grow and organisational costs remain under control.

Increasing emphasis on cloud deployment capabilities will further differentiate IQGeo’s offering and expand its
addressable market.
Richard Petti, Chief Executive Officer, said:“I am pleased that we have executed our strategy well in the first six months of the year with continued good momentum
in the second half. Despite the Covid-19 related market downturn we were able to increase our bookings and revenue
thanks largely to our subscription model which scales the number of paid seats as customers find their own use cases.
Additionally, we have seen subscription orders signed in the second half of 2019 converting to revenue in 2020
supporting significantly improved gross margins and reduced cash outflow.
By successfully scaling our digital presence and lead generation activity, targeted at senior decision makers working at
home with engaging content, we have increased the number of sales leads to pursue as we head into the second halfof the year and 2021. Our target customers have remained resilient through the pandemic and their investment plans in
networks (broadband, 5G, electricity and gas) and workflow productivity have remained substantially unaltered during
the downturn - in fact in certain areas investments are increasing.
Our product roadmap continues its high rate of innovation which will now feature more cloud deployment capabilitiesaligned with our subscription model, allowing for faster deployments and better scalability, enabling IQGeo’s software toreach thousands of potential users at each customer. We remain confident in the business opportunities and prospects
for the remainder of the year.”For further information contact:
IQGeo Group plc
Richard Petti
Haywood Chapman+44 1223 606655

FinnCap Ltd
Henrik Persson, Matthew Radley (Corporate Finance)
Tim Redfern, Richard Chambers (ECM)+44 20 7220 0500

Notes to Editors
About IQGeo
IQGeo™ (AIM: IQG) a leading developer of geospatial software that improves productivity and collaboration acrossenterprise planning, design, construction, maintenance and sales processes for telecoms and utility network operators.
Our mobile-first enterprise solutions create and maintain, an accurate view of complex network assets that is easily
accessible by anyone, wherever and whenever needed. Specialized applications combined with our open IQGeo
Platform help network operators create a single source of network truth to meet their digital transformation ambitions
and operational KPIs. Our award-winning, cloud-enabled solutions save time and money, and improve safety andproductivity, while enhancing customer satisfaction. Headquartered in Cambridge, with offices in Denver, Frankfurt andTokyo, we work with some of the largest network infrastructure operators in the world. For more information visit:https://www.iqgeo.com/

Chief Executive Officer’s statement
Overview
Our trading has been good throughout the first six months of the year as we saw our bookings increase by 120% to£5.5m. One part of the increase comes from our continued success in securing new logos where we have seen additionalcustomers added in all three of our key markets (North America, Europe and Japan) including a Fortune 500 North
American Energy company. The second driver of the increase comes from our success in signing new logos in 2019.
We have consistently proven that our customers will frequently add more users in their second and third years of usage
than they did in the original installation and so it has proven to be the case in 2020. Significant extensions to existing
contracts with two customers have resulted from successful deployments of our core offerings thanks to a combinationof a great user experience and compelling business cases (ROIs). Additionally, we have seen a customer signed in thelatter part of 2019 come online and their subscription fees have contributed to an increase in revenue from IQGeo
products by over 50% to £3.6 million. This has had a beneficial effect on gross margins which now exceeds 50% for the
first half up from 34% in H1 2019.
The pandemic has shifted our target buyer’s work behaviors by noticeably increasing the amount of work from home.
While this has decelerated some aspects of decision-making, we have leveraged the increase in online time by scaling
both our digital content and our lead generation campaigning which has resulted in an increase in traction with our target
buyers as measured by site visits, content engagement, webinars and ultimately qualified leads. This has allowed us toscale our prospecting activities which in previous years would have involved more in-person meetings or conference
attendance which is both slower and more costly than digital lead generation.
Our core markets of telecoms and utilities have proven to be resilient throughout the pandemic. Telecoms network
operators in particular have seen consistent demand for broadband services where increased use of videoconferencing
platforms like Zoom and Teams has increased the need for consumer high bandwidth fixed line services or, as analternative, 5G connectivity which is increasingly being viewed as an alternative to fiber to the home connections. Utilities
have seen a more mixed picture with downturns in their commercial business as factories and production plants remained
closed while retail customers have changed their consumption patterns due to increased work from home. As a result of
these demand patterns both telecoms and utility network operators have not substantially altered their investment plans
either in the networks themselves or in the tools supporting them. Moreover, remote working has highlighted the dangersof older legacy geospatial architectures. These legacy systems cannot efficiently be accessed remotely, emphasizing
the benefits of IQGeo’s mobile-first and cloud-first architecture that is easily accessed on normal web browsers or mobile
devices.
Strategic Priorities
As we head into the second half of the year and the first half of 2021 our priorities will be:
1.
2.
3.
4.
5.

Order growth: Maintaining the high level of growth in new logos and expansion orders across our key markets
of North America, Europe and Japan.
Subscription model: Maintaining the high percentage of new orders being secured as long-term subscriptions
driven by customer’s new use cases and increased user base.
Cloud capabilities: Developing and enhancing our market-leading cloud capabilities to further support largescale deployment on optimised infrastructures.
Increased channel influence: Building on the success of our Japanese channel model we will be expanding
our strategic partnerships with selected partners in Europe and North America.
Quality of earnings: By growing our recurring subscription revenue, scaling through partners and sensibleorganisational growth we aim to continue growing gross margins and reduce cash outflows in line with our longterm planning.

Chief Executive Officer’s statement continued
Board changes
As was announced in the 2019 year end results, Tim Gingell stepped down from the board as Chief Financial Officer at
the AGM in June, and will leave the Company shortly following a handover to the incoming CFO, Haywood Chapman. I
am very grateful for the transformative work that Tim achieved and wish him well for the future. Haywood joins the board
with great experience of building businesses and delivering increased shareholder value which I’m sure he will repeat at
IQGeo.
Current trading and outlook
For the remainder of 2020 we expect software subscription orders to continue their positive growth trend. The 2020 fullyear results are expected to see continued improvement in subscription orders generating increases in revenue andgross margins over 2019 and materially reduced operating cash outflow. As we move into 2021, operating cashflow is
expected to continue to improve, with good sales momentum building our base of subscription revenues in relation tooperating costs.

Richard Petti
Chief Executive Officer

Financial Review
The Group is focused on growing IQGeo product revenues which include generating recurring revenues from software
subscription products, selling perpetual software licences and the associated maintenance and support contracts, anddelivering consultancy services revenues. Additionally, the Group has a legacy operation that provides lower margin
consultancy services connected to third party products which have declined in the current period (less than previous
expectations) and are expected to decline in future periods.
The commercial model continues to focus on increasing Annual Contracted Value (“ACV”) through subscription-based
software sales and maintaining long-term relationships with customers, creating recurring revenue growth andachieving sustained profitability.
The Group has continued to increase ACV won during H1 2020 with 90% of products being licenced on a subscription
basis. As at 30 June 2020 the Group’s total ACV, which includes maintenance of support of perpetual licences, was£2.9 million (31 December 2019: £2.0 million, 30 June 2019: £1.6 million).
OrdersBookings of orders related to IQGeo products increased by over 120% to £5.5 million during H1 2020 (H1 2019: £2.5
million).
Bookings of orders related to third-party Geospatial Services were £0.5 million (H1: 2019: £Nil million).
IQGeo product order backlog as at 30 June 2020 was £5.8 million (H1 2019: £1.7 million). Third-party Geospatial Services
order backlog was £1.0 million (H1: 2019: £0.9 million).
Revenue
Revenue composition by revenue stream is summarised in the table below:
Revenue by stream
Subscription

H1 2020£’000
976% of total
revenue20%

H1 2019£’000-% of total
revenue-Year onyear growth
N/A

Maintenance and support

649

14%

589

16%

10%

Recurring IQGeo product revenue

1,625

34%

589

16%

176%

Software

122

3%

737

20%

(83)%

Services

1,847

39%

1,027

29%

80%

Non-recurring IQGeo product revenue

1,969

42%

1,764

49%

12%

Total IQGeo product revenue

3,594

76%

2,353

65%

53%

Geospatial services from third party products

1,128

24%

1,292

35%

(13)%

Total revenue

4,722

100%

3,645

100%

30%

2019’s subscription sales success has translated into increased recurring revenues for IQGeo’s products in the first halfof 2020. Combining subscription and maintenance and support revenues, IQGeo’s product recurring revenue has grownto £1.6 million reflecting 176% growth when compared to the same period of 2019. IQGeo’s strategy of focusing on
growth of ACV through additional subscription sales together with an increased focus on renewal of the existing
subscriptions and maintenance streams will ensure continued growth of its recurring revenue base providing greater
predictability of income in future periods and ultimately delivery of sustainable profitability.
As the number of new deployments and expansion orders continue to increase, the associated service revenues havealso grown with a good backlog of further work to be recognised in future periods.

Financial Review continued
Gross profit
Geospatial gross profit
Gross profit/gross profit margin

H1 2020
£’000
2,422

Gross
margin %51%

H1 2019
£’000
1,226

Gross
margin %34%

Grossmargin mvt
17%

Gross margin percentage has increased by 17% compared with the prior period. This increase is a result of the revenue
mix moving towards higher margin IQGeo product revenues. Improved services margins have been achieved throughthe delivery of internal efficiencies driving higher staff utilisation on billable projects, as well as tight cost management
including some temporary cost reduction measures.
Operating expenses and adjusted EBITDA from continuing operations
Operating expenses were £4.1 million (H1 2019: £4.4 million) and are summarised as follows:
H1 2020

H1 2019

£’000

£’000

Other operating expenses

3,631

4,022

Depreciation

223

139

Amortisation and impairment

472

406

Share option expense

20

6

Unrealised foreign exchange on intercompany trading balances

(282)

(151)

Total operating expense

4,064

4,422

Other operating expenses of the Group include sales, product development, marketing, and administration costs.
On 1 April 2020 Group implemented a number of temporary cost reduction measures including a 20% base salary
reduction for higher paid staff and the board as a result of COVID-19, which were subsequently relaxed on 1 July 2020.
Additionally, there has been a significant reduction in travel and marketing expenditure as an unavoidable consequenceof the pandemic. While these short-term measures have reduced costs during the first half of 2020, the Group anticipates
expenditure to increase again to support the growth of the business.
Adjusted EBITDA from continuing operations excludes amortisation and impairment, depreciation, share option expense,
foreign exchange gains/losses on intercompany trading balances and non-recurring items and is reported as it reflects
the performance of the Group. Adjusted EBITDA for the period was a £1.2 million loss (H1 2019: £2.8 million loss).
The operating loss for the period from continuing operations was £1.6 million (H1 2019: £3.2 million loss).
EPS and dividends
Adjusted diluted loss per share from continuing operations was 4.0 pence (H1 2019: 4.6 pence). Reported basic anddiluted loss per share from continuing operations was 3.5 pence (H1 2019: 4.4 pence).
Consolidated statement of financial position and cash flow.
Cash as at 30 June 2020 was £11.9 million (31 December 2019: £13.1 million, 30 June 2019: £26.0 million).
Materially reduced net cash outflow from operating activities was £1.1 million (H1 2019: £3.6 million).
Cash net of debt as at 30 June 2020 was £11.2 million (31 December 2019: £13.1m, 30 June 2019: £26.0m).
Recognising the importance of cash management and that the US operations are not cash generative yet, the US
subsidiary participated in the USA CARES Act’s “Paycheck Protection Program” taking on a loan of USD 819,000 withHSBC Bank USA at an interest rate of 1%. No adjustment has been included for any potential loan write-off that may be
applicable at a future point in time.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of the business. The key risks that could affect the Group’s
performance, and the factors which mitigate these risks, have not significantly changed from those set out on pages 28
to 31 of the Group’s Annual Report for 2019 (a copy of which is available from our website www.iqgeo.com).

Consolidated income statement
for the six months ended 30 June 2020

Notes

Revenue
Cost of revenues

4

6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited
£’000

4,722

3,645

7,806

(2,300)(2,419)(4,563)Gross profit

2,422

1,226

3,243

Operating expenses(4,064)(4,422)(9,539)Operating loss

(1,642)(3,196)(6,296)Gross profit

2,422

1,226

3,243

Other operating expenses(3,631)(4,022)(8,091)

Adjusted EBITDA(1,209)(2,796)(4,848)Depreciation

(223)

(139)

(285)

Amortisation and impairment of other intangible assets

(472)

(406)

(815)

Share option expense

(20)

(6)

(102)

Unrealised foreign exchange gains/(losses) on intercompany
trading balances

282

151

(110)

-

-

(136)

(1,642)(3,196)(6,296)

(42)

35

62

(1,684)(3,161)(6,234)

(48)

(32)

64

(1,732)(3,193)(6,170)Analysed as:

Non-recurring items
Operating loss
Net finance income/(costs)
Loss before tax
Income tax
Loss from continuing operations
Profit from discontinued operations
Loss for the year

-

329

403

(1,732)(2,864)(5,767)(3.5p)(4.4p)(9.4p)

Loss per share - continuing operations
Basic and diluted

Consolidated statement of comprehensive income
for the six months ended 30 June 2020
6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited£’000

Loss from continued operations
Profit from discontinued operations(1,732)-(3,193)329(6,170)403

Loss for the year
Other comprehensive income:Items that may be reclassified subsequently to profit and loss
Exchange difference on retranslation of net assets and results ofoverseas subsidiaries from continuing operations
Items that will not be reclassified to profit and loss
Changes in the fair value of equity investments at fair value throughother comprehensive income(1,732)(2,864)(5,767)

(109)

(128)

5

(1,800)--Total comprehensive loss for the year

(3,641)(2,992)(5,762)

Consolidated statement of changes in equity
for the six months ended 30 June 2020
Attributable to equity shareholders of the parent company
Sharecapital
£’000

Share
premium£’000

Share based
payment
reserve£’000

Capitalredemption
reserve£’000

Translation
reserve£’000

Retainedearnings
£’000

Total
£’000

1,462

46,375717-(1,871)(14,411)32,272

Loss for the period

-

-

-

-

-

(2,864)(2,864)

Exchange difference on retranslation of net assets andresults of overseas subsidiaries

-

-

-

-

(128)

-

(128)

-

-

-

-

(128)

(2,864)(2,992)

-

-

(116)

6

30

Balance at 1 January 2019

Total comprehensive loss for the period
Reserve debit for equity-settled share-based payment

-

(116)

-

Exercise of share options

4

26

(6)

-

Lapse of share options

-

-

(57)

-

-

57

-

Transactions with owners

4

26

(179)

-

-

63

(86)

1,466

46,401538-(1,999)(17,212)29,194

Loss for the period

-

-

-

-

-

(2,903)(2,903)

Exchange difference on retranslation of net assets andresults of overseas subsidiaries

-

-

-

-

133

-

133

Total comprehensive loss for the year

-

-

-

-

133

(2,903)(2,770)

Balance at 30 June 2019 (unaudited)

Capital reduction-(28,948)---

28,948

-

(476)

-

-

476

-

(10,950)(10,950)

Exercise of share options

-

1

-

-

-

-

1

Lapse of share options

-

-

(3)

-

-

3

-

Reserve debit for equity-settled share-based payment

-

-

97

-

-

-

97

Transactions with owners(476)(28,947)

94

476

-

18,001(10,852)

Balance at 31 December 2019

990

17,454632

476(1,866)(2,114)

15,572

-

-

-

-

-

(1,732)(1,732)

Repurchase and cancellation of shares

Loss for the period
Exchange difference on retranslation of net assets andresults of overseas subsidiaries

-

-

-

-

(109)

-

(109)

Other comprehensive losses

-

-

-

-

-

(1,800)(1,800)Total comprehensive loss for the period
Exercise of share options

-

-

-

-

(109)

(3,532)(3,641)

2

10

(3)

-

-

3

12

Lapse of share options

-

-

(567)

-

-

567

-

Reserve debit for equity-settled share-based payment

-

-

20

-

-

-

20

2

10

(550)

-

-

570

32

992

17,46482

476(1,975)(5,076)

11,963

Transactions with owners
Balance at 30 June 2020 (unaudited)Consolidated statement of financial position
for the six months ended 30 June 2020
At
30 June 2020
unaudited£’000

At
30 June 2019
unaudited£’000

At
31 December 2019
audited
£’000

1,772
197
1,771
200

1,329
107
191
2,000

1,596
86
73
2,000

Total non-current assets

3,940

3,627

3,755

Current assets
Trade and other receivables
Corporation tax receivable
Cash and cash equivalents

2,431
14
11,8742,857
26,0352,353
16
13,053

Total current assets

14,31928,892

15,422

Total assets

18,25932,51919,177

Liabilities
Current liabilities
Trade and other payables
Current tax liabilities
Lease obligation
Bank loans(3,392)
(103)
(332)

(2,709)
(184)
(196)
-

(3,241)(79)-(3,827)(3,089)(3,320)(322)(1,814)
(333)

(236)
-

(285)
-

Total non-current liabilities(2,469)

(236)

(285)

Total liabilities(6,296)(3,325)(3,605)

Net assets
Equity attributable to owners of the parent company
Ordinary share capital
Share premium
Share based payment reserve
Capital redemption reserve
Translation reserve
Retained earnings

11,96329,194

15,572

992
17,46482
476(1,975)(5,076)

1,466
46,401538(1,999)(17,212)990
17,454632
476(1,866)(2,114)

11,96329,194

15,572

Notes

AssetsIntangible assets
Property, plant, and equipment
Right of use assets
Investments

6
7
8

7
9

Total current liabilities
Non-current liabilities
Deferred income tax liabilities
Lease obligation
Bank loans

Equity attributable to shareholders of the Company

7
9

10
10

Consolidated statement of cash flows
for the six months ended 30 June 2020
6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited£’000(1,684)-(3,161)-(6,234)161

Loss before tax from operating activities
Adjustments for:
Depreciation
Amortisation and impairment
Revaluation of intercompany balances
Share-based payment charge
Finance income
Finance costs(1,684)(3,161)(6,073)

223
472
(282)
20
(7)
49

139
406
(151)
6
(41)
6

285
815
110
(19)
(72)
10

Operating cash flows before working capital movement
Change in receivables
Change in payables(1,209)(78)
204(2,796)
(107)
(612)

(4,944)
388(10)

Cash generated from operations before tax(1,083)(3,515)(4,566)

(11)

(77)

(124)

(1,094)(3,592)(4,690)Cash flows from investing activities
Purchases of property, plant, and equipment
Expenditure on intangible assets
Cash received on sale of the RTLS SmartSpace business unit
Disposal costs in relation to the RTLS SmartSpace business unit
Interest received

(143)
(647)
7

(50)
(493)
1,060
(1,766)33(56)(1,176)
1,060(1,839)72

Net cash flows from investing activities(783)(1,216)(1,939)

662
(1)
(78)
13

(117)
30

(2)
(238)
(10,950)
31

Notes

Operating activities
Loss before tax from continuing operations
Loss before tax from discontinued operations

Net income taxes paid
Net cash flows from operating activities

Cash flows from financing activities
Borrowings
Interest paid
Payment of lease liability
Repurchase of ordinary share capital
Proceeds from the issue of ordinary share capital

9

596

(87)

(11,159)

Net decrease in cash and cash equivalents
Cash and cash equivalents at start of period
Exchange differences on cash and cash equivalents(1,281)
13,053102(4,895)30,915
15(17,788)
30,915(74)

Cash and cash equivalents at end of period

11,874

26,035

13,053

Net cash flows from financing activities

Notes to the interim consolidated financial statements
1 General information
IQGeo Group plc (“the Company”) and its subsidiaries (together, “the Group”) deliver end-to-end geospatial software
which improves productivity and collaboration across enterprise planning, design, construction, maintenance and sales
processes for telecoms and utility network operators. Our mobile-first enterprise solutions create and maintain, an
accurate view of complex network assets that is easily accessible by anyone, wherever and whenever needed.
Specialised applications combined with our open IQGeo Platform help network operators create a single source of
network truth to meet their digital transformation ambitions and operational KPIs. Our award-winning, cloud-enabled
solutions save time and money, and improve safety and productivity, while enhancing customer satisfaction.
The Company is a public limited company which is listed on the Alternative Investment Market (AIM) of the London Stock
Exchange (IQG) and is incorporated and domiciled in the United Kingdom. The address of its registered office is CB1
Business Centre, 20 Station Road, Cambridge CB1 2JD.
The Group has its operations in the UK, USA, Canada, Germany and Japan, and sells its products and services in North
America, Japan, the UK and Europe.
The condensed consolidated interim financial statements were approved by the Board of Directors for issue on 11
September 2020.
The condensed consolidated interim financial statements do not comprise statutory accounts within the meaning ofsection 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2019 were approved by the
Board of Directors on 6 March 2020 and delivered to the Registrar of Companies. The report of the auditors on thoseaccounts was unqualified, did not contain a material uncertainty related to going concern paragraph and did not containany statement under section 498 of the Companies Act 2006.
The condensed consolidated interim financial statements have been reviewed, not audited.
2 Basis of preparation
The condensed consolidated interim financial statements should be read in conjunction with the annual financial
statements of the Group and are prepared in accordance with IFRSs as adopted by the European Union.
Going concern basis
The Directors have adopted the going concern basis in preparing the financial statements. In assessing whether thegoing concern assumption is appropriate, the Directors have taken into account all relevant information about the current
status of the business operations, including the impact of the global COVID-19 pandemic. The Directors have areasonable expectation that the Group has adequate resources to continue operations for the foreseeable future and forat least 12 months following the approval of these accounts. This expectation is arrived at following a review of cash
resources, cashflow projections, customer order book, and pipeline of future projects and includes the assessment of
COVID-19 on operations.
For the purposes of the preparation of the consolidated financial statements, the Group has applied all standards andinterpretations as adopted in the European Union that are effective and applicable for accounting periods beginning on
or before 1 January 2020. There are no standards in issue and not yet adopted that will have a material impact on thefinancial statements.
3 Accounting policies
The accounting policies adopted in the preparation of the condensed consolidated interim financial statements areunchanged from those set out in the Group’s consolidated financial statements for the year ended 31 December 2019.

Notes to the interim consolidated financial statements continued
4 Segmental information
4.1 Operating segments
Management provides information reported to the Chief Operating Decision Maker (CODM) for the purpose of assessing
performance and allocating resources. The CODM is the Chief Executive Officer.
The continuing Geospatial operations are reported to the CODM as a single business unit.
4.2 Revenue by type of the continuing Geospatial operations
The following table presents the different revenue streams of the Geospatial business unit:

6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited
£’000

976
649

589

381
1,251

Recurring IQGeo product revenue

1,625

589

1,632

SoftwareServices
Non-recurring IQGeo product revenue

122
1,847
1,969

737
1,027
1,764

1,589
2,328
3,917

Total revenue generated from IQGeo products

3,594

2,353

5,549

Geospatial services from third party products

1,128

1,292

2,257

Total revenue

4,722

3,645

7,806

Subscription
Maintenance and support

4.3 Geographical areas of continuing operations
The Board and Management Team also review the revenues on a geographical basis, based around the regions where
the Group has its significant subsidiaries or markets.
The Group’s revenue from external customers in the Group’s domicile, the UK, and its major worldwide markets havebeen identified on the basis of the customers’ geographical location and is presented below:

UK
EuropeUSA
CanadaJapan
Rest of World

6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited
£’000

179
102
2,999
559
872
11

17
73
2,711
685
149
10

95
169
5,897
1,164
461
20

4,722

3,645

7,806

Notes to the interim consolidated financial statements continued
5 Earnings per share (EPS)

Earnings attributable to Ordinary Shareholders
Loss from continuing operations
Gain /(loss) from discontinued operations
Gain /(loss) from continuing and discontinued operations
Number of shares
Weighted average number of ordinary shares for the purposes ofbasic EPS (’000)
Effect of dilutive potential ordinary shares:– Share options (’000)
Weighted average number of ordinary shares for the purposes ofdiluted EPS (’000)

6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited£’000(1,732)(1,732)(3,193)329(2,864)(6,170)403(5,767)49,57773,26065,977

540

72

67

50,11773,332

66,044

Continuing operations EPS
Basic and diluted EPS (pence)

(3.5)

(4.4)

(9.4)

Discontinued operations EPS
Basic and diluted EPS (pence)

-

0.4

0.6

(3.5)

(3.9)

(8.7)

Continuing and discontinued operations EPS
Basic and diluted EPS (pence)

Basic earnings per share is calculated by dividing profit/(loss) for the period attributable to ordinary shareholders of theCompany by the weighted average number of ordinary shares outstanding during the period. For diluted earnings per
share, the weighted average number of shares is adjusted to allow for the effects of all dilutive share options and warrants
outstanding at the end of the year. Options have no dilutive effect in loss-making years and are therefore not classified
as dilutive for Discontinued and Total EPS since their conversion to ordinary shares does not decrease earnings per
share or increase loss per share from continuing operations.
The Group also presents an adjusted diluted earnings per share figure which excludes share-based payments charge,
unrealised foreign exchange gains/(losses) on intercompany trading balances and non-recurring items from themeasurement of profit for the period.

Continuing operations
Continued earnings for the purposes of diluted EPS being net loss
attributable to equity holders of the parent company (£’000)
Adjustments:
Reversal of share-based payments charge (£’000)
Unrealised foreign exchange gains/(losses) on intercompany tradingbalances
Reversal of non-recurring items (£’000)

6 months to
30 June 2020
unaudited£’000

6 months to
30 June 2019
unaudited£’000

12 months to
31 December 2019
audited£’000(1,732)(3,193)(6,170)

20

6

102

(282)
-

(151)
-

110
136

Net adjustments (£’000)

(262)

(145)

348

Adjusted earnings (£’000)(1,994)(3,338)(5,822)

(4.0)

(4.6)

(8.8)

Adjusted diluted EPS from continuing operations (pence)

The adjusted EPS information is considered to provide a fairer representation of the Group’s trading performance.
Options have no dilutive effect in loss-making years.

Notes to the interim consolidated financial statements continued
6 Intangible assets
At 30 June 2020
unaudited£’000

At 30 June 2019
unaudited£’000

At 31 December 2019
audited£’000

Capitalised product development costs
Software

1,695
77

1,244
85

1,499
97

Total intangible assets

1,772

1,329

1,596

Net book amount

7 Right-of-use assets and Lease obligations
On 20 December 2019, the Group entered into a lease running to February 2028 on new premises in Denver as thelease on existing premises ended on 30 April 2020. While the new Denver lease agreement was contracted during
2019, the lease period did not commence until 2020 and the capital asset for the present value of the future payments,
and its associated liability, has been recognised during the 2020 period in accordance with IFRS 16.
8 Investments
On 31 December 2018 the Group disposed of its RTLS SmartSpace business unit for a consideration of up to £35.0
million with £30.0 million paid in cash on completion (subject to adjustments for net debt and net working capital) in
addition to a £2.0 million roll over investment in Abyssinian Topco Limited. Abyssinian Topco Limited is a UK registeredcompany (company number 11649721) and is the ultimate UK parent company of Ubisense Limited which along with its
subsidiary companies, comprise the former RTLS SmartSpace business unit.
Management have assessed the fair value of the investment in Abyssinian Topco Limited and recognised a £1.8 million
adjustment to reduce the carrying value of the investment in accordance with IFRS 9. The Group has made the irrevocable
election to account for the investment in Abyssinian Topco Limited at fair value through other comprehensive income(FVOCI). In reaching this conclusion, management have considered the impact of the global COVID-19 pandemic on the
anticipated customer base of the Ubisense business.

Investment in Abyssinian Topco Limited

At 30 June 2020
unaudited£’000

At 30 June 2019
unaudited£’000

At 31 December 2019
audited
£’000

200

2,000

2,000

Additionally, under the terms of the sale agreement of the RTLS SmartSpace business, IQGeo would receive further
earn-out consideration of up to £3.0 million subject to the RTLS SmartSpace business unit meeting the following
milestones;£1.5 million is payable if revenue achieved for the year ended 31 December 2019 is £22.0 million; OR£3.0 million is payable if revenue achieved for the year ended 31 December 2019 exceeds £22.9 million.

Management has been advised by the directors of Abyssinian Topco Limited that the milestone has not been met which
will be confirmed in the financial statements for the year ended 31 December 2019.
Adjustments to the profit realised on disposal of the RTLS SmartSpace business have been presented as discontinued
operations within the comparative periods reported.
9 Bank loans
In April 2020, IQGeo America Inc, a subsidiary of IQGeo Group plc applied for and received a loan of $819,000 under
the USA CARES Act’s “Paycheck Protection Program” in order to support the USA operations during the uncertainty
caused by the impact of the global COVID-19 pandemic. The loan was provided by HSBC Bank USA and will accrue
interest at a rate of 1.0% p.a.

Notes to the interim consolidated financial statements continued
10 Share capital and premium
Number ofordinary sharesof £0.02 each

Share capital£’000

Share premium
£’000

Total
£’000

Balance at 1 January 2019
Issued under share-based payment plans

73,087,904
214,2151,462
446,37526

47,83730

Balance at 30 June 201973,302,199

1,466

46,40147,867

Issued under share-based payment plans
Capital reduction
Repurchase and cancelation of shares

5,000(23,803,690)

(476)

1
(28,948)-

1(28,948)(476)

Balance at 31 December 201949,503,429

990

17,454

18,44490,6572

10

1249,594,086

992

17,464

18,456

Issued under share-based payment plans
Balance at 30 June 2020

The Company has one class of ordinary shares which carry no right to fixed income.

11 Share options
At 30 June 2020, the Group had the following share-based payment arrangements.

Currency

Awardsoutstanding at
1 Jan 2020
NumberGrantedduringthe year
NumberExercisedduring theyear
NumberForfeited
during theyear
NumberGBP

94,957-90,657

2,500

1,800

1,800

GBP

28,700---28,70028,7002.125

GBP

28,000---28,00028,0002.055

GBP32,750---32,75032,750

2024

2.250

GBP

10,000---10,00010,0002017 – 19

2026

0.020

GBP

3,350,000--

3,350,000

-

-

2018

2019 - 21

2028

0.555

GBP

350,000---

350,000

233,3332020

2020 - 23

2030

0.460

GBP

- 1,971,000--

1,971,000-

2020

2020 - 23

2030

0.625

GBP

-

-

-

110,000-

2020

2020 - 23

2030

0.783

USD

ExpiresYear

Exercise
price£2011 – 13

2020

0.140

2011

2012 – 14

2021

1.050

2012

2013 – 15

2022

2013

2014 – 16

2023

2014

2015 – 17

2016

Arrangement

Award
date
Year

Vests
Years

Options

2010

Total
Weighted average exercise price (£)

110,000

Awardsoutstanding at
30 June 2020
NumberAwardsexercisable at
30 June 2020
Number

- 1,390,000--

1,390,000-

3,894,407 3,471,000

90,6573,352,500

3,922,250

334,583

0.14

0.020

0.569

0.924

0.117

0.535

2016 granted share options
On 14 December 2016, IQGeo Group plc granted 5,600,000 options of two pence each in the Company with an exercise
price set at the nominal value. The options vested if the Company’s share price exceeds 70 pence for 60 consecutive
calendar days between the 2nd and 3rd anniversary of issue and the period of employment continues for over three
years. Due to the LTIP performance condition not being reached in the year to 14 December 2019, the share options
have not vested. Despite the performance condition not being met during 2019, the Remuneration Committee retained
the right to extend the vesting period for another twelve months. The Remuneration Committee did not exercise the rightto extend the scheme and replaced this existing LTIP scheme with a new one during 2020.
2020 granted share options
On 15 June 2020, IQGeo Group plc implemented a new long-term incentive share option plan with options granted to
Executive Directors and employees of the Group. IQGeo Group plc granted a total of 3,471,000 options of two penceeach in the Company with varying exercise prices as set out above. The options vest in portions of one third on thefirst, second and third anniversaries of grant and have no further performance conditions other than ongoing
employment on the date of vesting and of exercise. Awards will be subject to a two-year holding period from vesting
point, with participants only permitted to sell shares sufficient to cover the exercise cost and any tax liability within thisholding period.

Independent review report to IQGeo Group plc
Introduction
We have reviewed the condensed set of financial statements in the half-yearly financial report of IQGeo Group plc (the‘company’) for the six months ended 30 June 2020 which comprises consolidated income statement, consolidated
statement of comprehensive income, consolidated statement of changes in equity, consolidated statement of financial
position, consolidated statement of cash flows and the related explanatory notes. We have read the other information
contained in the half yearly financial report and considered whether it contains any apparent misstatements or materialinconsistencies with the information in the condensed set of financial statements.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The AIM rules of the
London Stock exchange required that the accounting policies and presentation applied to the financial information in
the half-yearly financial report are consistent with those which will be adopted in the annual accounts having regard to
the accounting standards applicable for such accounts.
As disclosed in note 2, the annual financial statements of the group are prepared in accordance with International
Financial Reporting Standards as adopted by the European Union. The condensed set of financial statements includedin this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, 'Interim
Financial Reporting', as adopted by the European Union.
Our responsibility
Our responsibility is to express a conclusion to the company on the condensed set of financial statements in the halfyearly financial report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410,'Review of Interim Financial Information Performed by the Independent Auditor of the Entity'. A review of interim
financial information consists of making enquiries, primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtainassurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial
statements in the half-yearly financial report for the six months ended 30 June 2020 is not prepared, in all material
respects, in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by theEuropean Union.
Use of our report
This report is made solely to the company, as a body, in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of
the Entity'. Our review work has been undertaken so that we might state to the company those matters we are required
to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the company as a body, for our review work, for this report, orfor the conclusion we have formed.

Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
Cambridge
11 September 2020