Iofina posts record first-half revenue but profits fall

20th Sep 2024 13:14

(Sharecast News) - Iodine production specialist Iofina announced record first-half revenue on Friday, of $26m, a 7% increase compared to the same period last year, although its profits fell.

The AIM-traded firm said that for the first six months of 2024, it achieved a gross profit of $5.2m and adjusted EBITDA of $2.3m, down from $8.26m and $5.87m a year earlier, respectively.

Operating profit and profit before tax both stood at $1.1m, down from $4.9m and $4.68m.

The group's net cash position improved to $1.1m, excluding lease liabilities and after capital expenditures of $4.7m, primarily focussed on the development of its IO10 iodine production plant and investments in Iofina Chemical.

It produced 276.1 metric tonnes of crystalline iodine during the period, a 14.3% increase year-on-year and within its targeted range.

Sales of crystalline iodine rose 13% to 191 metric tonnes, reflecting continued strong market demand, despite a 7% decline in average iodine prices compared to the first half of 2023.

Iodine derivative sales increased 5% to $7.9m, while non-iodine derivatives saw a 4% rise to $4.7m.

Looking ahead, Iofina anticipated further growth in the second half, with the fully-commissioned IO10 plant expected to produce between 355 and 380 metric tonnes of crystalline iodine.

The group said it was well-positioned to support its ongoing investment program, bolstered by a cash position of $5.7m and an expanded loan facility of $10m.

Its board was optimistic about meeting full-year targets, as the iodine market showed signs of strengthening, with spot prices hovering in the upper sixty-dollars per kilogram.

"The group has delivered a robust first half performance, with sustained demand for our products and increased production leading to a 7% increase in revenue, despite the average realised selling price of iodine being 7% lower than reported for the first half of 2023," said president and chief executive officer Dr Tom Becker.

"The group has continued to generate strong cash flows, with its net cash position improving to $1.1m.

"Looking ahead, the completion of IO10 is anticipated to add a further 100 to 150 MT of annual iodine production capacity."

Dr Becker said the new plant would contribute to production in the remaining months of 2024, with the total crystalline iodine production range expected to be 355 to 380 MT in the second half.

He added that negotiations for IO11 were continuing to advance, with the company hoping to update on an agreement in the near future.

"As well as our commitment to securing sites for new plants and ongoing product research and development, new investment has been made in our marketing and sales team, including targeted hires and upgrades to our website and other digital marketing channels, to help facilitate and drive sales directly to Iofina Chemical.

"We have built a stronger platform for accelerated growth, and we look forward to reporting on further progress in due course."

At 1016 BST, shares in Iofina were down 6.98% at 20p.

Reporting by Josh White for Sharecast.com.