The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Hi All
Looks like progress is being made on the jobs front.
Now only three positions still open.
Second Shift Production Supervisor - looks to have been filled.
https://www.indeed.com/cmp/Itaconix-Corporation
ATB
AJP
Hi Thordon
Nothing to update at the moment, expecting a shipment/shipments either this week or next, will post as soon as anything appears.
I thought the new equipment was for the Bio-Astrix? which was targeting a few areas, clothing, paint, ink and biodegradable plastics? would have thought that they may add a second one as things advance or even a much larger piece of equipment as they move to upscale product to meet demand?
As you say many many new products in the high GPM area of haircare, shampoos, deodorants and cosmetics which even with the smaller volumes should still add to the ever improving GPM.
Will we get a broker update in the next week or so with an upward revision on year end revenues? (lets hope so eh)
ATB
AJP
Hi All
Think that was a buy at the end there, makes it hopefully an interesting day on Monday with us starting on NT to buy?
29-Sep-23 16:20:26 143.00 3,488 Sell* 139.00 149.00 4,988 (Buy to me)
Nice to see the followers ticking up on Linked-in, not sure about any of the other platforms.
Have a good weekend all
ATB
AJP
Hi S
How can 8 shares sold this morning move the SP down nearly 2% ever get the feeling that we are being manipulated and someone is going to step back in and scoop a bucket load of shares for a pittance.
May add some more today and take my average down, see how the morning pans out.
What are the chances of a director buy or II reducing their average with a purchase at these levels ?
Guess that once the tide changes then we will move very quickly northwards?
ATB
AJP
Cont.
• Zero debt, $10.9 Million in the bank
• Revenue/sales increasing, 5th consecutive record breaking years of revenue
• Much improving GPM
• Sticky repeat business
• Green/Eco friendly products
• A Frost & Sullivan 2022 Enabling Technology Leadership Award.
• Ever growing base of high profile customers, circa 150/160 brands and counting
• Development agreement (SAP) with a major North American pulp and paper company (update still outstanding?)
• High profile partners in Nouryon (Personal care) & Croda (Home care) and TBA (Diapers/personal hygiene products).
• Croda supply agreement recently renewed
• Itaconix joins with Brenntag to distribute cleaning polymers
• Ingredients ringfenced with great IP, with additional ingredients patent pending. New IP just recently approved
• Distribution out of New Hampshire & Belgium, European stocks enlarged to cover new customers
• Process being upgraded to maximise throughput of ingredients, currently running around circa 25%/50% of capacity
• A number positions which have been added and 4 more which are currently advertised to be filled.
• Placing of circa £10.5 million puts us in a very good position going forward, plenty of cash in hand.
• Record revenues for first half of 2023 $4.0 Million.
• New quality institutional investors on board, circa 50% of shares now in sticky hands.
• 50 to 1 consolidation completed, fewer shares in circulation circa 13.5 Million.
• The Board now comprises Dr. Peter Nieuwenhuizen (Non-Executive Chair), Paul LeBlanc (Non-Executive Director), John R. Shaw (Chief Executive Officer), and Laura Denner (Chief Financial Officer).
• Competent and enthusiastic BOD/Employees, with considerable skin in the game. Circa 1.5Million shares which is approx. 11% of issued shares
• Further development with R & D projects to follow via John and Yvon collaboration.
• Good level of diversification across products
Further products to be released during 2023/24, Velafresh SAP 80 development, polymer research and process development on the Company's plant-based superabsorbents have succeeded in achieving absorption performance that is closer to the incumbent acrylate superabsorbent polymers. We also have Velasoft BR 300 new in 2023/24 to be released.
• Increased marketing efforts with broader promotional activities moving into 2024.
• Canaccord states that possibly 2 partners to be announced this year 1 for composites and 1 in Hygiene.
• New equipment purchased and being used to enhance Bio-Asterix rollout in 2024
ATB
AJP
Hi S
There may be many reasons for the drop off in SP, some may be in a position where they need the money to pay bills, put food on the table, there are also those who may just be chancing their arm and trying to catch the proverbial falling knife and try and buy in again at a cheaper price, guess we just wait for the next RNS to drop that will change the sentiment/momentum.
As far as I can see we are in the best position we have ever been in, below is my taken where we are (I know been posted previously, but there may be those who have not seen it)
Will put it on a separate post.
ATB
AJP
Hi G
Yes you are totally correct. Contained within link below
https://itaconix.com/wp-content/uploads/Itaconix-2020-Annual-Report-Final.pdf
ATB
AJP
Thanks DB
Was hoping you would jump in there as was trying to put something together on this, looks like Dec 21 and JD was part of the conversation at the time?
09/12/21 from DB
Some thoughts on the doldrum share price & potential beneficiaries...
I knew had read somewhere - it was note 17 of the last annual report - that there is a contingent consideration payable annually at a value equivalent to 50% of the incremental revenue growth compared to the previous year’s. Crucially, it’s payable in shares “at the then prevailing price” to JS & YD.
So let’s imagine, when the 2021 books close, annual revenue is $4.5M ie $1.2M incremental growth on 2020. That means the contingent consideration for 2021 is $600k payable in shares at the prevailing price on 31.12.2021.
At a share price of 5p, that is an award of some 9M shares and at 10p “only” 4.5M. John Shaw and Yvonne Durant are in this for the long haul in my view and they will be happy if they get 9M shares instead of 4.5M. They know what is coming down the tracks, as do presumably the last IIs who invested at 12p.
This contingent consideration bonus expires end of next year (2022). As I’ve often said 20p by ‘23 - or maybe more...
On the above basis I expect some upwards movement in January - just my musings, which may be wrong!
14/12/21 from DB
They’ll get potentially 2 further bites at the contingent consideration bonus Thordon. Provided 2021 revenues exceed 2020 and similarly 2022 those of 2021 , we’ll see RNS’s in April 2022 and April 2023 detailing the amount of bonus award, payable in shares, as we saw last year.
21/12 21
Here is the detail of the bonus scheme. Note it is 50% in of incremental revenue:
Note 17 in the Annual Report (page 62) explains how the scheme works. In 2020, scheme members were entitled to a bonus of 50% of incremental sales above $3m. Sales for the year were $3.292m, so the bonus was (3,292m – 3m) * 0.5 = $146,000. The bonus was paid through the issuance of 1,923,389 new shares in the company as per the RNS of 9 April. John Shaw received 884,953 of the shares (46.0%) and Dr Yvon Durant received 205,802 (10.7%).
ATB
AJP
Totally S
MC at circa £20 million and we have half of that sitting in cash and there or there about in breakeven with 3 out of the first 9 months of 2023 EBITDA positive as per John during presentation, SP is totally laughable and an absolute steal at these prices, currently £1.50 to buy (3p in old money)
ATB
AJP
Hi
Been here longer than that, sometimes you just have to stay in the game and believe reason why you invested here in the first place still makes sense and that the potential for success is still as strong as it was back then, as far as I can see, this is very much still the case, the tide will turn.
Is it not a bit ridiculous that we have has such a big drop with not that many shares being traded and would guess that not all the trades were sells either, ever get the feeling that the poor PI get shafted on here sometimes as very prone to hitting the panic button, big hold and grab some more at these bargain basement prices sub 3.2p in old money.
Have a good weekend all
ATB
AJP
Hi C
Do agree to a certain extent, as regards time to market and sticky repeat increasing revenues, but as for fireworks, I do feel that once we have accelerated the introduction of new products and applications within the Company's VELAFRESH® hygiene and BIO*Asterix® intermediates businesses and VELAFRESH® SAP80. Then maybe we should at least see at least a few sparklers lol
BIO*Asterix®
Think that BIO*Asterix® is going to be much bigger than anyone initially thought, just in paint applications alone, it could be massive
VELAFRESH® SAP80.
Polymer research and process development initiated after the February 2023 fundraise HAS !!! generated desired performance improvements. These breakthroughs are expected to allow the Company to introduce a more competitive product, can you imagine what revenues would be like with a contract with one of the major players in this area?
Sorry I know that you are invested in Enquest
But at the moment we are being held to ransom by the oil producing countries that are controlling the price of oil, I am sure we are all feeling this pain at the pumps, It is therefore imperative that we reduce our dependence on fossil fuel bi-products, as in the long term the price pain will only get worse, this is where ITX can step in and seize the advantage with their green cost effective performance ingredients.
ATB
AJP
Hi L
Are we not looking at a different situation here, are we comparing eggs with eggs?
A company producing say a widget is bringing a new item to the market place and if it takes off will sell multiples of this item, but then the demand will tail off as the market becomes saturated, in particular if this is not a consumable item.
With ITX we are not creating a new product per say but integrating our green chemistry to become a replacement item in a vast array of different products that are already established in the market place, consumable items that constantly need replaced, but to do so by the nature of chemical ingredients this takes time as there will be a lot of testing and conformities to pass by formulators before this can even be considered, not to mention any existing contracts that may have to be honoured with the company producing the ingredient we are replacing,.
Once all this has been successfully completed then this is when we see the sticky repeat revenues and exponential revenue increases as we become the must have ingredient, in my opinion this is where we are at the moment, on the launch pad ready for take-off.
Apologies for all the rubbish analogies.
Yes totally, patience is required, but what is the catalyst to start moving the SP North of where we are? Breakeven, large contract, influx of US investors, directors/Institutional Investors buying more shares etc
Fundamentally we are in the best place we have ever been financially and nobody invests circa £10.5 million without there being a very good case for doing so, the future looks very bright, let’s see how this all pans out over the next few months as the expected US base comes on board.
It’s a strong buy and hold from me
AIMHO
ATB
AJP
Synopsis of 2023 Half Year results
Safer Ingredients for a Low Carbon Economy
ITX targeting being a very large specialty ingredients company with revenues in excess of $100 million annually and profits to match.
5th consecutive year of record first half revenues $4 million in 2023 with revenues for the rest of this year in line with broker expectations (will there be an increase in expected revenues as per last year in the not to distant future?)
Now have a minimum of 150/160 consumer brands and increasing
$20 billion potential market
$2.3 billion addressable market
Blended Gross Profit Margin up 3.2% to 28%
This was due mainly to production ramp up and pricing increases to customers in the late part of 2022
Performance Ingredients – GPM 34%
Formulation Ingredients – GPM 10%
Core areas
Cleaning – 25% GPM
Beauty – 60% GPM
Hygiene – 75% GPM
Targeted increases in Beauty and Hygiene will see our GPM improve even further as these areas have excellent GPM
Remember we have the commercial technology in the conversion of Itaconic acid into green ingredients that major players in our industry over the years have failed to achieve all ringfenced with very tight IP
The potential for Bio-Asterix and the superabsorbents, will take our revenues onto the next level over the next period of time, we will see significant progress in these two areas throughout 2024 where we will be working with innovative leaders in these fields to progress.
Digital marketing improvements
Increases in staffing all areas
Improvements in production processes and new equipment
We are still running at less than 50% capacity, but the flexibility of the production facility means that we can run 24 hours as and when necessary to meet customer demands.
We have a large proprietary technical platform which will furnish us with many opportunities for years to come to continue to introduce new ingredients.
No direct competition
3 out of the first 9 months of 2024 have been EBITDA positive, meaning that breakeven and profitability is even closer
Consolidation along with a push on company investor relations in the US should see more American investors come on board, with previous restrictions on US investors being able to hold these shares in their brokerage accounts now having been overcome, this may take a few months before we see the impact.
NASDAQ not an option, excessive costs against and potential benefits.
Broker targets are over 100% upside from here
At these prices this is a steal, under 3.4p old money !!!
Are we being shorted?
Am holding here and adding where possible, take the average down a bit at these levels.
What do we need to help turn the tide? (thoughts)
Some selling here must be doing so at a loss?
ATB
AJP
Hi
Can someone enlighten me from the half year results?
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translated foreign operations
$439,000 in 2023
$97,000 in 2022
Does this indicate that we have circa $350,000 sitting in raw materials (itaconic acid) ?
Just waiting for next shipment (BOL) to drop and be updated
Nice 2000 share purchase from someone this morning.
See the Investor Meet recording and Q&A are also now available.
ATB
AJP
Sorry forgot to add at the end
The SP is ridiculous, if you convert this back into old money (lol) we are looking at under 3.7p a total steal at that price in my opinion, when they are taking of a future $100 million turnover company.
ATB
AJP
See that they stopped when it got to the more searching ones, with regards to the following
5) Itaconix was a project partner in a funded grant looking into
New Branched Polymers Excipients and Emulsions for Enhanced Drug Delivery
Project Partners:
Clinton Health Access Initiative CHAI Itaconix (UK) Limited Medicines Patent Pool
https://gow.epsrc.ukri.org/NGBOViewGrant.aspx?GrantRef=EP/R024804/1
Can you advise on this and if there are any potential future commercial advantages to this research?
6) New IP since last presentation
Asymmetric And Symmetric Monomer Mixtures Of Esters Of Itaconic Acid And Corresponding Copolymers
Can you elaborate on commercial implications?
10) Additional partners
Canaccord has stated that possibly 2 partners to be announced this year 1 for composites and 1 in Hygiene. Can you update us on this please?
At least it is a bit clearer that the impact of the consolidation will not start to have an effect for a few months, from an American investor perspective.
As I have stated previously the potential here is massive and not just in the main three areas we are involved in, but the countless other areas there ITX ingredients can be substituted in for the more nasty petrochemical ones.
Hold and continue to add for me
ATB
AJP
Lifted from ADFN
Canaccord Genuity view
Robust 1H result Itaconix has this morning reported strong 1H results in line with its July trading statement: revenue $4.0mn +32% y/y, EBITDA loss of $0.4mn, and net cash of $10.9mn, all as expected. We are making no material changes to our near-term forecasts, with some minor changes to the rate of progress of earnings beyond 2024. Cleaning products continues to be in take-off, with revenue from these products up 33% y/y and continued strong margin development. Cash flow was also good, with notably low capex, modest growth in SG&A and continued good control of working capital. We note that the additional funds raised in February are allowing Itaconix to move more rapidly on certain product development, notably on a lower-cost production methodology and on matching the performance of incumbent fossil-based polymers in targeted applications. We remain BUYers with an unchanged target of 400p."
"Valuation: BUY and 400p target unchanged
We base our price target on multiples and on the value that we believe Itaconix's differentiated, plant-based technology platform would have to an industrial third party. At our target the stock would have a market value of around £53mn/$68mn, which is around 4.5x/3.3x 2025E/26E EV/revenue, which we believe would be highly attractive to an industrial buyer looking at markets with gross margins in the hundreds of millions of dollars annually."
ATB
AJP