Plant Health Care PLC Trading Statement (4129U)
January 18 2017 - 1:00AM
UK Regulatory
TIDMPHC
RNS Number : 4129U
Plant Health Care PLC
18 January 2017
PLANT HEALTH CARE plc
("Plant Health Care" or the "Company")
Trading Update
Plant Health Care(R) , a leading provider of novel
patent-protected biological products to the global agriculture
markets, issues the following post year-end trading update ahead of
the announcement of the Company's audited full year financial
results for the year ended 31st December 2016, which is expected no
later than the second week of April. All results provided are
preliminary and subject to completion of the 2016 audit.
Financial and Commercial Highlights
- Revenue of approximately $6.3million; sales in the United
States decreased by approximately $1.1million, due to the decision
to reduce in-market inventories. Growth outside the United States
was 15% in constant currency
- Sales of core Harpin(TM) <ALPHA><BETA> products
decreased by roughly 12%, driven by lower sales in the United
States; Harpin <ALPHA><BETA> sales outside the United
States increased by approximately 23%. Harpin
<ALPHA><BETA> and Myconate(R) products represented 59%
of sales in 2016 (2015: 57%)
- Gross Margin was steady at 62% in 2016
- Cash and cash equivalents at 31st December 2016 were $10.1 million
- Revenue growth in Mexico of approximately 9% in local currency
- New distribution agreements signed during the second half of
2016 show potential for growth in Commercial sales during 2017
- In August 2016, the Company successfully raised GBP7.6 million
($10.0 million) and is well funded to execute its plan
New Technology Highlights
- Trials with Innatus(TM) 3G (the first platform of PREtec
peptides) in 2016 continued to show good results, in Plant Health
Care's own trials and in field trials run by partners
- All four evaluation partners have now extended the terms of
their contracts into 2018 We are on track for the first competitive
licensing process to conclude in early 2018
- Two new PREtec peptide platforms - T-Rex 3G and Y-Max 3G -
have been presented to selected industry players. First agreements
are in place and field trials have begun
- More partners are expected to sign up to evaluate PREtec
peptides over the coming months. We are targeting a
revenue-generating licence before the end of 2017
- Plant Health Care is making solid progress in building its
capability to make, to formulate and to register PREtec
peptides
- Facilities in Seattle have been further expanded and are
operating well. This was accompanied by an increase in R&D
expenditure to $4.5M ($4.1M in 2015)
Chris Richards, Interim CEO, commented:
"In 2016, Plant Health Care continued to show solid progress
towards our key strategic objectives.
We are excited by the strong field data that our evaluation
partners have generated in their 2016 trials of Innatus 3G. It has
been rewarding to see their enthusiasm building through the year as
they come to understand the power of our technology and its
potential value to them. They are beginning to focus their
attention on preparing for the planned competitive licensing
process of first rights in early 2018. We look forward to an
expanded programme of evaluation in 2017.
The existing Innatus 3G partners were among the first to move
forward to evaluate the new PREtec platforms. We had originally
intended only to advance with one new PREtec platform, but their
active encouragement and the strength of our supporting data
persuaded us to advance with two: T-Rex 3G and Y-Max 3G. These are
now attracting the interest of other companies. We are aiming to
enter into at least one revenue-generating licence during 2017.
On the commercial side, our distributors have continued to grow
sales of Harpin <ALPHA><BETA>. Sales by Plant Health
Care to distributors, however, were disappointing. This was due to
our decision to decrease channel inventory in the United States
during the second half of 2016. On the ground, Sym-Agro increased
sales by more than 20% in the Pacific North West and continue to
grow. Outside the USA, sales grew by 15% in constant currency, in
spite of drought in South Africa and the disappointing delay to
first sales into sugar cane in Brazil. The launch of Harpin
<ALPHA><BETA> in Italy was very encouraging, while
sales in Spain increased by 64%. In Mexico, Harpin
<ALPHA><BETA> was launched in early 2016 and this led
to sales growth of 49% (in local currency) of Harpin products in
2016, compared with 2015. In addition to growth through existing
distributors, new agreements concluded during the second half of
2016 are expected to drive sales growth in 2017 and 2018. The gross
margin remained steady, reflecting the stability of the commercial
business.
In August, we completed an equity raise which generated $10
million, largely from existing investors. We anticipate that
existing cash reserves, together with forecast commercial revenues
and cost savings already put in place, will now fund the business
at least until the end of 2018. As a result, we are confident that
the next two years will see a step change in the position of Plant
Health Care.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
For further information, please contact:
Plant Health Care plc
Chris Richards, Interim Chief Executive Officer Tel: +1 919 926 1600
Jeffrey Hovey, Chief Financial Officer
Liberum Capital - Nomad and Broker
Clayton Bush / Chris Clarke Tel: +44 (0) 20 3100 2000
Company website: www.planthealthcare.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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