Itaconix widens loss after exiting nicotine gum business

Josh White Sharecast | 27 Mar, 2017 15:34 | | |

money

Itaconix

20.00

17:16 21/07/17
2.56%
0.50
  • 12,959.86
  • -0.08%-10.87
  • Max: 13,128.21
  • Min: 12,921.91
  • Volume: 0
  • MM 200 : n/a
17:30 21/07/17
  • 969.70
  • 0.22%2.11
  • Max: 972.57
  • Min: 967.34
  • Volume: 0
  • MM 200 : n/a
17:18 21/07/17

Itaconix posted its preliminary results for the 12 months to 31 December on Monday - a year in which it changed its name from Revolymer, and undertook a “major reorganisation” to focus on its specialty chemicals business.

The AIM-traded firm reported £8.8m of short term deposits, cash and cash equivalents on hand at the year end, down from £10.5m.

Its financial reporting for the year was split into continuing operations - specialty chemicals including the US business of Itaconix Corporation acquired in June 2016 - and its discontinued nicotine gum operations.

Continuing operations revenue was £0.3m, up from nil a year earlier, primarily thanks to the Itaconix DSPTM product, resulting in a gross profit of £0.1m, also rising from nil.

Administrative expenses on continuing operations - including research and development expenditure - was £5.3m, up from £2.7m.

The increase of £2.6m was explained by the board by an increase in non cash charges relating mainly to the acquisition of Itaconix of £1.0m, £0.3m of costs not expected to be recurring, the cost of running the new US business including research and development of £0.6m, additional UK staff costs including research and development of £0.3m, additional other development costs of £0.1m, and additional advisory - including external finance and audit - costs of £0.1m.

As a result, the group’s operating loss before tax was £5.2m, widening from £2.6m, with the difference mainly accounted for by the increase in administrative expenses, half of which were non-cash or non-recurring.

Continuing operations’ total loss for the year widened to £5.1m from £0.7m, after research and development tax credits of £0.5m and a share of the loss of an associate of £0.5m.

“The group now has a portfolio of specialty products to supply to its customers in its key market segments of personal care, homecare and industrial,” said chief executive officer Kevin Matthews.

“All of these segments are global in nature, consistently delivering high growth rates and attractive margins.

“There are significant benefits to a product based business versus a licence only model including greater customer intimacy, more control over execution timelines and greater margin potential.”

Dr Matthews described Itaconix as an “innovator”, developing new products to meet customer needs.

“As well as having expertise in designing novel polymer products that can be protected with patents and know-how, the business has also developed application and formulation expertise that provides better insights into how polymers can be used to provide cost effective solutions for its customers.

“Itaconix is engaged in building a high margin, capital efficient business.

“Except for its relatively low cost polyitaconate manufacturing facility, the business uses third party contract manufacturers for a number of its products.”

More news

19:19 US close: Stocks edge lower ahead of Fed, White House in focus

Stocks drifted slightly lower ahead of the next US central bank policy meeting, weighed down by a poor outlook from industrial conglomerate General Electric and further negative news-flow swirling around the White House.

21 Jul Commodities: Increasing supply of oil weighs heavy on the market

An over supply of crude from Nigeria and Libya of approximately 1m barrels per day weighed heavily on the oil market on Friday with September contracts for both WTI crude and Brent crude down 2.28% and 2.29% respectively.

21 Jul Magnolia Petroleum announces divestment of North Dakota and Oklahoma wells

Magnolia Petroleum, an Oklahoma based oil and gas investment company, has divested and agreed farmouts over several wells in North Dakota and Oklahoma for a total of $411,000.

21 Jul Europe close: DAX dives on euro peaks and colluding carmakers

European stocks ended the week firmly in the red as the euro continued to march higher, with the strength in the single currency weighing on exporters and car makers were hit by reports of collusion in the industry, combining to send the Dax to new three-month lows.

21 Jul FX round-up: Lack of data release makes way for indecisive Cable moves

On Friday sterling managed to recover most of its losses against the US dollar from prior session posting a morning high of 1.3020, only managing to touch psychological resistance of 1.3000 briefly.

21 Jul London close: FTSE profit taking kicks shares into red

UK stocks were lacklustre on Friday as oil and stocks plunged but investors mulled yet more waxing and waning of Brexit negotiations, proving that uncertainty is the only certainty surrounding the issue.

21 Jul FTSE 100 movers: Paddy Power leads Friday retreat

London's FTSE 100 was in the red on Friday, along with stock benchmarks in Europe and the US.

21 Jul General Electric tumbles further as profits slide

US industrial giant General Electric reported net profits of $1.34bn for the second quarter of 2017, 53% less than its earnings for the same quarter in 2016.

21 Jul US open: Wall Street slips amid weak tech earnings, downbeat GE

Wall Street was slightly lower in early trading following disappointing updates from Microsoft and Ebay, alongside weak guidance from industrial conglomerate GE.

21 Jul Catalyst Media softens blow from failed Greyhound track bids

Retail betting service supplier Sports Information Services (SIS), in which Catalyst Media Group holds a 20.5% stake, has secured rights and media agreements for its greyhound and horseracing content.