Plant Health Care, Dr. Christopher Richards, Executive Chairman and Interim CEO, commented:
“The progress of our Commercial business in 2018 is not reflected in our first half sales, because of measures taken to reduce channel inventory in Africa. The launch into corn in the USA, together with exciting potential in sugarcane, underpin our confidence in meeting market expectations for the full year and delivering sustained growth in the medium term. We anticipate that the Commercial business will generate cash during 2018, thereby reducing the Group’s cash burn.
“Despite the set-back in the disease management trials in Brazil, we continue to have confidence in the long term value of our PREtec technology. Trials of Innatus 3G will continue in Brazil, to reinforce the yield benefit proposition and to better understand the benefit on disease management. Outside ASR in Brazil, we continue to generate positive results with PREtec peptides and pursue opportunities to monetise the technology in due course.”
“Over the last five years, we have built substantial assets in plant response elicitor technology, with over 40 patent applications in this area to date. Having secured a strong technical base for PREtec, we are now able to reduce R&D spend without compromising our active efforts to monetise the technology. At the current projected level of spend, the Commercial business will generate sufficient cash to bring us to cash positive in 2020, within existing cash reserves.”
Plant Health Care® (LOn: PHC), a leading provider of novel patent-protected biological products to global agriculture markets, announced its unaudited interim results for the six months ended 30 June 2018.
Financial Highlights
– The Board expects to achieve full year revenue expectations, which would represent 30% growth over 2017.
– Revenue for the six months ended 30 June 2018 was $3.0 million (2017: $3.1 million). We expect revenue in the second half to advance strongly over the comparable period last year substantially driven by the launch of Harpin ?β into corn in the USA and sugarcane in Brazil.
– Gross margin improved to 60% (2017:58%).
– Following a successful fundraise of $6.7 million (net of costs) in February 2018 the Company has cash reserves of $6.2 million.
– The Board expects to reach cash positive within existing cash reserves; this plan is not reliant on income from New Technology.
Operational Highlights
– Harpin ?β was launched in Brazil sugarcane in February 2018 through Coplacana under the brand name H2Copla. Grower feedback has been strong.
– Since the launch of H2Copla in February 2018, the product has generated revenue of $400k. The Company expects to generate at least as much revenue from H2Copla in the second half of 2018.
– Recently announced launch into corn in the USA brings expectation of significant sales in the second half of 2018.
– Industry partners continue to evaluate Innatus 3G, T-Rex 3G and Y-Max 3G in more than a dozen crops and in three regions around the world.
The strong growth of our Commercial business expected in 2018 as a whole, together with new launches over the next eighteen months, give the Board confidence that the Group will be cash positive in 2020. The Board expects to achieve full year market expectations for 2018.
