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Sustainable Products Drive Major Revenue Growth

 

Itaconix (LSE: ITX) (OTCQB: ITXXF), a leading innovator in sustainable specialty polymers, is pleased to announce its unaudited interim results for the six months ended 30 June 2020 ("2020").

A copy of the Interim Report & Accounts is available for download on Itaconix's website at www.itaconix.com.

Financial Highlights

Financial results for the first half of 2020 show the increasing uptake by major brands of the Company's sustainable products as key ingredients in everyday consumer goods and the significant progress made towards profitability from higher volumes across both home and personal care applications.

 

• First half revenues of $1.1 million were 80% higher than the first half of 2019 and 59% higher than the second half of 2019. First half revenues also represent 84% of revenues for the full year of 2019.
• Gross profits were $0.4 million, representing an increase of 129% over the first half of 2019 and 47% over the second half of 2019. 
• Gross profit margin was 37% compared to 35% for the full year of 2019, remaining in line with Company expectations for a specialty ingredient company.
• Adjusted EBITDA¹ was a loss of $0.6 million, compared to a loss of $1.2 million for the same period in 2019 and a loss of $1.2 million for the second half of 2019, reflecting the continued trajectory towards achieving break-even profitability from increasing revenues.
• Gross operating loss of $0.8 million, representing a decrease of 43% from losses of $1.4 million in both the first and second half of 2019.
• Cash and Cash Equivalents as at 30 June 2020 was $0.5 million, compared to $0.8 million as at 31 December 2019.
• In May 2020, Itaconix Corporation received a US Government Paycheck Protection Program Loan for $0.2m to support the business through the Covid-19 pandemic.
• In July 2020, the Company completed an equity raise with gross proceeds of $2.2 million to fund operating costs and working capital needs as revenues advance toward break-even profitability.

 

Operational Highlights

The acceleration in revenues is the result of the continued broadening of the customer base and advancement in customer projects in the Company's major application areas:

 

• Revenues increased across all of the Company's home and personal care polymers. 
• Although demand for household cleaning has surged during the Covid-19 pandemic, major new revenues came from new customer products entering the market with new levels of performance, cost and sustainability. 
• We introduced our new Itaconix® TSI™ 322 detergent polymer with use in two North American dishwashing detergent brands.
• The Company completed a supply agreement with New Wave Global Services Inc. ("New Wave"), a leading North American detergent supplier, on the pricing and supply of up to 1,000,000 lbs. of Itaconix detergent polymers through 2021.  Volumes in the first half of 2020 exceeded management expectations.
• Demand for our ZINADOR™ odour removal polymer continues to expand into leading household brands and new regions through our collaboration with Croda.
• Revenues for our hairstyling polymer advanced through our collaboration with Nouryon.
• The Company announced its new BIO*Asterix™ line of functional additives and a joint development agreement for potential use by a leading innovator in biodegradable packaging.  

 

Outlook

Itaconix has commercial momentum as current customer products succeed in the market and new customer products continue to progress to market in the next year. The expanding foundation of recurring revenues is creating a strong base for continued revenue growth toward the Company's goal of sustainable profitability in the coming years.  

 

John R. Shaw, CEO of Itaconix, stated: "Major advancements in our customer pipeline allowed us to enter a new phase of commercial growth in the first half of 2020.  Our customers are succeeding with new products that leverage the unique value and functionality of our sustainable ingredients. When consumers purchase these new products for their performance and cost, they also benefit the environment through a reduction in the depletion of natural resources, an increase in the use of safer chemicals, and a reduction in the release of chemicals."

¹ Adjusted EBITDA is defined and reconciled to Operating loss in Note 4 of the Interim Report.

 

For further information please contact:

Itaconix plc	+1 603 775-4400
John R. Shaw / Laura Denner
N+1 Singer	+44 (0) 207 496 3000
Peter Steel / James Moat (Corporate Finance) Tom Salvesen (Corporate Broking)

About Itaconix

Itaconix develops and produces bio-based functional ingredient that improve the safety, performance or sustainability of consumer and industrial products, with technology and market leadership positions in non-phosphate detergents, odour control, and hair styling. 

www.itaconix.com