Light Science Technologies Holdings PLC (AIM:LST) this week announced a new partnership - with Agrolux, a global provider of horticultural lighting.
The collaboration is expected to see the company expand its market reach.
Agrolux is part of ScottsMiracle-Gro, a company listed on the S&P 400 with a market capitalization of just under £4 billion.
LSTH chief executive Simon Deacon joined the Proactive studio, and, highlighted that working with an established industry leader strengthens the firm’s competitive position and enhances its ability to offer turnkey solutions to growers worldwide.
We take a closer look at what was said here.
Proactive: Joining me is Light Science Technologies Holdings PLC CEO Simon Deacon. Simon, very good to speak with you today. Could you start by telling us who Agrolux is?
Simon Deacon: Good morning, Stephen. Agrolux is one of the largest horticultural lighting providers globally.
The ultimate parent company is ScottsMiracle-Gro, which is on the S&P 400 with a market cap of just under £4 billion.
So, they are a huge player in the market worldwide. We are really proud to be partnering with them.
Proactive: What does this partnership mean for Light Science Technologies?
Simon Deacon: Oh, it's a big deal for us. We provide a turnkey solution with our sensor technology, lighting, and digital platform.
Partnering with a larger organization like Agrolux is part of our strategy to expand our global audience and customer base. It makes a significant difference for us.
When we compete against large players in the field, it helps to partner with an industry leader.
This allows us to sell not only our lighting products but also our sensory control system and digital platform, providing a complete solution for growers worldwide.
Proactive: You mentioned there are quoted pipeline opportunities of £4.6 million in the UK and Ireland and £5.7 million in Europe, totaling £10.3 million. Can you explain this, Simon?
Simon Deacon: It's broken into two parts. We have a quoted pipeline of £4.6 million in the UK and Ireland through this relationship. Additionally, we have another quoted pipeline from them worth £5.7 million.
These projects will go into various glasshouses and vertical farms, with completion expected in 2025 and 2026.
This provides good visibility for our Controlled Environment Agriculture (CEA) division for this year and next.
Proactive: Finally, looking at the broader group, Simon, how is it performing?
Simon Deacon: The group’s performance is strong. We closed our financial year at the end of last year, achieving a 29% revenue increase. Our gross margin improved from 23% to 28%.
We now have a group quoted pipeline of £50 million. The CEA and Passive Fire Protection divisions are balancing our revenue streams, and our gross margin improvements are making the business more cash-generative.
We were profitable in the second half of last year, which gives us a positive start to this year.
Proactive: Congratulations again on this latest deal, Simon. I hope you’ll keep us updated on any additional progress.