TIDMBIOM
RNS Number : 1891G
Biome Technologies PLC
22 July 2019
22 July 2019
Biome Technologies plc
("Biome", "the Company" or "the Group")
Trading Update
Biome Technologies plc, a leading bioplastics and radio
frequency technology business, today publishes a trading update for
the six months ended 30 June 2019. The unaudited interim results
are expected to be announced on 12 September 2019.
Total Group revenues for the first half of the year were GBP3.6m
(H1 2018: GBP4.4m) with the Bioplastics division reporting a 53%
increase in revenues over the same period in the prior year and
revenues generated by the RF technologies division returning to a
more normalised level as anticipated in previous statements.
The Directors expect that, for the half year to June 2019, the
Group will report a modest loss before interest, tax, depreciation,
amortisation and share option charges (based on unaudited
management accounts) as the business supports an increased
headcount to drive growth.
The Group's cash position as at 30 June 2019 was GBP1.7m (31
March 2019: GBP2.3m), reflecting Group trading performance and an
increase in working capital requirements.
Bioplastics Division
Revenues in the division continue to grow with H1 2019 reaching
GBP1.4m (H1 2018: GBP0.9m and FY 2018 GBP1.8m). Turnover in the
second quarter reached GBP0.8m, a 26% increase over the first
quarter.
In line with our strategy, it has been particularly encouraging
to see these growing revenues coming from three key growth drivers:
a greater number of customers; a wider range of end-use application
areas; and a broader geographic base. Whilst much of this growth is
based on development projects that commenced some time ago, the
continued global focus on the problem of plastics, both in their
disposal and the climate change impact of their manufacture, is
supporting the appetite for our existing products and continuing to
increase our product development and customer project pipeline.
To further illustrate the above, the performance in the
first-half was driven by several new customers and initial sales
for several of the division's novel products, including:
-- a new material for a new customer supplying single serve pods
being launched into the global sports nutrition market
-- a new material for an existing customer launching a
compostable range into the US disposable cutlery market
-- materials for a plastic film application with a new customer in the US market
Our non-woven coffee filter material, introduced to the market
in 2016, continues to achieve higher levels of revenue, assisted by
the completion of the transfer of its manufacture from Germany to
the US where the contract manufacturer's new facility has further
headroom for growth in production.
As a result of the increasing volume of sales, we have also
recently contracted for commercial production of bioplastic
materials in the UK, initially for the continental European market,
and expanded its capacity for the US market.
Given the above, the Board remains confident of a gradual but
sustained increase in the Bioplastics division's revenues as the
year progresses.
Stanelco RF Technologies Division
Revenues for the first half of 2019 in the Stanelco RF division
were GBP2.2m (H1 2018: GBP3.5m, H1 2017: GBP1.7m). This reduction
in revenue is due to the previously announced return to more
normalised sales levels of fibre optic furnaces following the
exceptional demand experienced in 2018.
Encouragingly, the division has recently signed a GBP1.3m
contract for the supply of a number of fibre optic furnaces to a
regular international customer for delivery in H2 2019. This
underpins revenue expectations for the second half and underlines
the further requirement for capacity in the fibre optic market.
The Board continues to believe that revenues from this division
for 2019 will be in line with previous guidance, being closer to
those recorded in 2017 than the exceptional level in 2018.
Outlook
Our two divisions continue to perform to our expectations. We
expect the growth drivers of the Bioplastics division to continue
to propel it towards eclipsing Stanelco RF as the principal revenue
generator for the Group within the next year or so.
We remain confident in our ability to take advantage of the
opportunities our markets are offering.
- Ends -
For further information please contact: Biome
Technologies plc
Paul Mines, Chief Executive Officer
Declan Brown, Group Finance Director
www.biometechnologiesplc.com Tel: +44 (0) 2380 867
100
Allenby Capital
David Hart/Alex Brearley (Nominated Adviser)
Kelly Gardiner (Broker)
www.allenbycapital.com Tel: +44 (0) 20 3328
5656
About Biome
Biome Technologies plc (Ticker:BIOM) is an AIM listed,
growth-orientated, commercially driven technology group. Our
strategy is founded on building market-leading positions based on
patented technology and serving international customers in valuable
market sectors. We have chosen to do this by developing products in
application areas where the value-added pricing can be justified
and that are not reliant on government legislation. These products
are driven by customer requirements and are compatible with
existing manufacturing processes. They are market rather than
technology-led.
The Group comprises two divisions, Biome Bioplastics Limited and
Stanelco RF Technologies Limited. Biome Bioplastics is a leading
developer of highly-functional, bio-based and biodegradable
plastics. The company's mission is to produce bioplastics that
challenge the dominance of oil-based polymers. Stanelco RF
Technologies designs, builds and services advanced radio frequency
(RF) systems. Dielectric and induction heating products are at the
core of a product offering that ranges from portable sealing
devices to large furnaces for the fibre optics markets.
In 2018, the Board adopted the following three high level KPIs
for the next three years to continue its ambitious momentum:
-- Compound revenue growth of 25% per annum across the Group and
40% compound revenue growth in the Bioplastics division
-- Diversify the Group's turnover by product and market to
ensure that no one product or end customer contributes more than
15% of revenues by 2020
-- Increase investment in the Group's next generation of
products by spending significantly more per annum on average than
the GBP0.3m per annum average spend over the previous strategic
objective cycle
www.biometechnologiesplc.com
www.biomebioplastics.com and www.thinkbioplastic.com
www.stanelcorftechnologies.com
#ThinkBioplastic is our digital educational platform, launched
in October 2018 in response to the emerging global plastic
conversation. It speaks to a wide audience, highlighting
bioplastics as a leading solution among several to reduce the
negative impact of plastic manufacture and disposal. Following the
much acclaimed first series of short videos the second series was
recently released.
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END
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