Symphony Environmental Technologies plc (LON:SYM) has reported that revenues for the current financial year are expected to be “in line with market expectations” and higher than last year, however, its marketing spending also increased.
In a trading update, the plastics maker said revenues for the full year would be around 6% higher than last year, with full-year earnings expected to be £100,000.
The reduction in earnings was seemingly due to increased investment in the firm's communications and marketing department, which rose to £380,000 for the year. The group had also recently established an in-house marketing department to assist driving sales of its products throughout the distribution network.
The gross margin generated in the first half of the year, at 47.4%, was lower than the circa 49% historically achieved, principally due to increased lower margin finished product sales, with this level of sales mix and gross margin expected to broadly continue for the full year.
Symphony said orders of its d2p anti-microbial technology had been “significantly ahead” of last year and were expected to “comfortably exceed” management expectations, with promotion campaigns scheduled in October to increase product listings.
Also, after two years of research and development, Symphony had received a US$120,000 initial commercial order for its d2p anti-insect additive technology with a large global manufacturer of commercial agricultural products.
For its d2w oxo-biodegradable plastic range, the company said orders had remained strong, but the timing of orders placed by distributors in their principal market, the Middle East, had been fluctuating quite significantly from month to month and are currently anticipated to be lower than original management expectations due to varying levels of, and delays in, local enforcement action.
D2w revenues generated from sales in other markets such as Central America, the Far East, Europe and Africa, were are all growing “ahead of budget”.
Symphony added that it would continue to meet its expectations for 2019.