Symphony Environmental “positive outlook on commercialisation and the pipeline” says Zeus

Symphony Environmental Technologies plc (LON:SYM) has announced new orders and a global expansion of d2p anti-insect technology sales to Rivulis, a global leader in drip irrigation products and solutions. The company has placed orders valued at more than $340k this month which follows sales in 2021a of $65k, and $130k during H1 2022e. Rivulis is using d2p for anti-insect protection for pipework. This announcement follows the supply agreement signed late last month with Grupo Bimbo, a large bakery group, for d2p additive applied to bread packaging film. For the moment, given the uncertain macro environment and inflationary headwinds we leave our estimates unchanged, but clearly commercial momentum is accelerating. We will update estimates as needed with the half year earnings due in September. Our DCF-based valuation is 35p, indicating good potential upside to the current share price of 17.5p.

Ramp-up in orders for d2p anti-insect technology – Rivulis (www.rivulis.com) is a global leader in drip irrigation products and solutions. The company has placed orders for d2p “AI” exceeding $340k this month which follows sales in 2021a of $65k, and which doubled to $130k during H1 2022e. SYM’s collaboration with Rivulis started in December 2017 after the Group’s R&D department created a masterbatch with anti-insect properties which could be put into plastic products at the point of manufacture. Since then, SYM’s technical team has supported Rivulis in the development of a reportedly unique range of irrigation pipes for farmers and growers. Plastic irrigation pipes and drip-tapes are an effective way to deliver water to growing plants, but valuable water was being lost because insects were puncturing the pipes. By incorporating d2p AI into its products, Rivulis has significantly reduced the damage caused by insects, and the amount of water being lost. This is particularly of benefit in dry areas of the world. SYM expect Rivulis to place further orders for d2p AI before the end of the year. SYM’s innovative d2p AI technology can be used in water pipes, and in any plastic articles and surfaces in homes, schools etc. to defend against insects, many of which can spread diseases.

Recap on d2p product supply agreement with Groupo Bimbo – SYM announced an exclusive supply agreement for its d2p antimicrobial technology with Grupo Bimbo (grupobimbo.com) on 28 June. In part this agreement stems from the exclusive regulatory approval secured from the Food and Drug Administration in the USA in 2020 and from Health Canada in 2021, for use of d2p in bread packaging plastic films. Grupo Bimbo has asked SYM to supply d2p for its nominated bread packaging manufacturers across the American continent for a period of three years. Anticipated revenue has not been disclosed but we believe, given the size of Grupo Bimbo’s operations (i.e., $17bn of annual revenues, and probably 20% share of the USA packaged bread market), there is potential for significant additional sales for SYM over the coming years.

Outlook and Zeus estimates – Symphony Environmental reported full year results in late March (see: Solid progress despite challenges, 31 March 2022). At the time, the outlook statement was cautious but positive. Management stated that trading had started to improve following a slow start to the year. Continuing high shipping costs and delays remained a concern but some raw materials costs had started to reduce. Overall, the Board stated that it was confident that commercialisation and financial performance would be much stronger in 2022e. We think the announcement today and for Grupo Bimbo a week ago are validation of this positive outlook on commercialisation and the pipeline.

Summary financials

Price17.5p
Market Cap£31.4m
Shares in issue179.3m
12m Trading Range13.7p–28.9p
Free float38%
Next EventH1 – September

Financial forecasts

Dec. y/e (£m)2021a2022e2023e2024e
Revenue9.211.91416.6
Gross Profit3.65.167.1
Adj. PBT-1.501.12.1
EPS (p) Adj.-0.80.10.71.2
DPS (p)
Net cash/(debt)-0.3-0.20.72.6
P/E, x-30.126.114.6
EV/EBITDA, x-24.933.415.4
Source: Company data and Zeus estimates
Click to view all articles for the EPIC: ,
Or click to view the full company profile:
Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Symphony Environmental

More articles like this

Symphony Environmental

No sufficient evidence to ban plastic and AIMPLAS

In one of Canada’s most consequential environmental court cases, a federal judge in Toronto has heard arguments from representatives of the plastics industry contesting a national ban on some single-use plastic products. The ban affects plastic bags, straws,

Symphony Environmental

Symphony Environmental secures convertible loan raising £1 million

Symphony Environmental Technologies Plc (LON:SYM), global specialists in technologies that make plastic and rubber products “smarter, safer and sustainable”, has announced receipt of a convertible loan from Sea Pearl Ventures Limited, based in the Bahamas. Key terms of the Loan are: ·      Loan

Symphony Environmental

Providing protection for the lifetime of the product

d2p AM – A suite of masterbatches offering cost-effective protection against dangerous microbes on plastic products and other surfaces. The active ingredient in our Antimicrobial Plastic Additive is an organic chemical substance, tested against bacteria (both Gram (+) and Gram

Symphony Environmental

Insecticide Technology

Kills insects by embedding the insecticide within the plastic. It is not sprayed or painted on the surface, so it remains effective against insects for the life of the plastic product. Composition Insecticides – finely dispersed in a

Symphony Environmental

Technology for the healthcare industry

d2p is a family of technologies specifically designed for products used in healthcare settings. Plastics play a vital role in the healthcare industry today, especially in the light of the COVID-19 pandemic. They are essential for syringes, IV

Symphony Environmental

Lobbyist Swamp in Brussels, Failed SUP Ban in India and Deliveroo

“LOBBYIST SWAMP” IN BRUSSELS Following the corruption scandal in the European Parliament revealed in December, when the police found suitcases stuffed with banknotes, the Dutch socialist MEP Paul Tang has said that “MEPs’ assistants, EU Commission officials, and

Symphony Environmental

Corruption in the EU Parliament

CORRUPTION IN THE EU PARLIAMENT Readers will recall that on 19th December 2022 I said I was not entirely surprised to see that a Vice-President of the European Parliament had been arrested for corruption, and that the homes

Symphony Environmental

UK Government will not support compostable plastic

In their January 2023 report Summary of responses and government response the UK government say “Compostable plastics must be sent to an industrial composter for them to compost, so if littered in the open environment they will act much like

Symphony Environmental

Compostable Greenwashing, Home Composting – More Greenwashing

COMPOSTABLE GREENWASHING According to the Daily Mail on 30th December 2022  new research by “Sourceful” a Manchester-based supply chain transparency consultancy says that “marketing compostable plastics as good for the planet is ‘greenwashing’” making things appear more eco-friendly

Symphony Environmental

BPA comments on US Plastics Pact

Their Report on PROBLEMATIC AND UNNECESSARY MATERIALS is fundamentally mistakeninsofar as it relates to compostable and biodegradable plastics. A. The type of plastic marketed as “compostable” is problematic and unnecessaryB. Oxo-biodegradable plastic is necessary and is not problematic.

Symphony Environmental

Top 10 best bioplastics companies 2022

Here are the Champions of 2022 TotalEnergies (Corbion) Braskem BASF NatureWorks Futamura Mitsubishi Chemical Novamont Avantium Symphony Environmental TIPA Symphony Environmental UK company producing “biodegradable” plastics under the brand name “d2w”. They’re going for the “biodegradable” model instead

Symphony Environmental

EU court case update

We were not entirely surprised to see that a Vice-President of the EU Parliament had been arrested for corruption, and that the homes and hotels of 18 MEPs and officials had been searched by the police, who found

Symphony Environmental

End Plastic Waste India Summit

Symphony Environmental Technologies plc (LON:SYM) is a world leader in the development of additives to make ordinary plastic biodegradable and protective technologies to enhance plastic products.

Symphony Environmental

EU talking about biodegradable plastic

I have been reading a Communication on 30th November 2022 from the EU Commission (COM(2022) 682 final) on an “EU policy framework on biobased, biodegradable and compostable plastics.” It is not an impressive document. In this 15-page Communication

Symphony Environmental

Symphony for change

Symphony Environmental Technologies plc (LON:SYM) is a world leader in the development of additives to make ordinary plastic biodegradable and protective technologies to enhance plastic products.

No more posts to show