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Plant Impact PLC (PIM)

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Monday 17 July, 2017

Plant Impact PLC

Full Year Trading Update & Potential Capital Raise

RNS Number : 2134L
Plant Impact PLC
17 July 2017
 

The Company considers that this announcement contains inside information for the purposes of the Market Abuse Regulation

 

For immediate release                                                                                                                                17 July 2017

Plant Impact plc

("Plant Impact", the "Company" or together with its subsidiaries, the "Group")

Full Year Trading Update and Potential Capital Raise

Plant Impact plc (AIM: PIM) leads research and development in crop enhancement technology to create products that growers can rely on to increase the yield and quality of their crops.  Today the Group announces a pre-close trading update for the year ending 31 July 2017 ("FY17").

On 19 June 2017, the Company announced that it was in contract discussions with Bayer CropScience Brazil ("Bayer"), the Company's partner in Brazil and the exclusive marketer of the Company's flagship soybean product, Veritas®.  These discussions aim to revise the structure of the Company's contract with Bayer to provide greater inventory purchase flexibility for Bayer and more predictable income and earnings visibility for the Company.  The contract discussions continue to progress positively but are expected to take some time to conclude.  Bayer remains fully committed to the commercial development of Veritas®, which during its first four years of sales has grown to be the leading biostimulant in the Brazilian soybean market.  

Bayer has set end-user sales targets for the 2017/18 growing season, which anticipate strong growth in grower usage of Veritas® building on Bayer's achievements of the past two growing seasons. This has driven an agreed plan for new purchases of Veritas® commencing in the first half of the Company's financial year ending 31 July 2018 ("FY18"). However, to reduce current stock levels in the market, the Company has agreed to cancel early season shipments previously anticipated for July 2017. 

Consequently, the Company now expects revenue for FY17 of between £8.5m and £9.0m, compared with £7.2m in the previous year. Further to this, revenues for FY18 are expected, at this early stage, to be around £13m, based on the new purchasing plan agreed with Bayer and also the Group's growth expectations in other markets such as the United States and West Africa.

The Group's cash balance at 31 July 2017 is expected to be around £3.2m. The Company's commercial business plan for next year anticipates good cash flow generation before investments in research and development. The Company now has a significant number of product development projects in the final stages of pre-commercial testing, and the Board has determined that it is in the best interest of shareholders to sustain the momentum of the R&D supporting these projects.  With this in mind, the Board is considering an equity fund-raise of a minimum of £2.0m, for which it has received an indicative commitment for the full amount from an existing institutional investor at a price of 31.0 pence per share. In addition to this commitment, the Board would consider placing an additional £2.0m of new funds at this price and as such the Company will be meeting with existing and prospective shareholders shortly to identify any additional interest.

For further information please contact: 

Plant Impact plc

John Brubaker, Chief Executive Officer

Richard Amos, Chief Financial Officer

Ailish Tracy, Global Communications Manager

 

Tel: +44 (0) 1582 465 540

 

Peel Hunt - Nominated Advisor and Broker

Adrian Trimmings

George Sellar

 

Buchanan - Financial PR

Mark Court

Sophie Cowles

Jamie Hooper

Tel: +44 (0) 207 418 8900

 

  

Tel: +44 (0) 207 466 5000

 

 

Ends


This information is provided by RNS
The company news service from the London Stock Exchange
 
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