(Alliance News) - Shares in Iofina PLC on Monday tumbled as the company said it lowered its production target for the first half due to lower brine volumes in two of its plants.
Iofina shares were down 13% at 16.40 pence each on around midday in London on Monday.
The London-based iodine producer said it expects positive trends in iodine to continue throughout the first half of 2022. These include continued strong demand and a high iodine spot price of USD50 per kilogram.
Nonetheless, it forecasted production of 225 to 240 metric tonnes of crystalline iodine for the first half this year.
This would be around 13% to 14% lower than the production target of 260 to 275 metric tonnes from the second half last year.
Iofina put this down to two of its plants that continue to receive lower brine volumes compared to pre-pandemic levels, due to less reinvestment by its partner in their oil operations.
However, Iofina still affirmed that the plant efficiencies of its IOsorb plant remain strong.
The company produced 268.8 metric tonnes of crystalline iodine in the second half last year from its five operating IOsorb plants in Oklahoma, US. This was in line with expectations.
The production figure for the past year totalled 518.2 metric tonnes.
However, the company warned of future increased spending on oil production wells by its partner as oil prices continue to be "robust".
The company added that it made progress towards finalising an agreement for the construction of IO number 9 and started to order long lead time items to minimise the total construction time for the plant.
It expects to provide further news in the coming weeks.
"As highlighted in our last update, with production stabilised, our speciality chemical business performing well, and the iodine market fundamentals turning increasingly favourable, the outlook for 2022 is certainly encouraging," Chief Executive Tom Becker said.
He added: "We have taken further steps forward to finalising an agreement with a new brine partner and expect to have this completed soon, with our plant construction team ready to start immediately."
By Abby Amoakuh; abbyamoakuh@alliancenews.com
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Iofina (IOF)