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Nouryon deal to support estimates for detergent revenues in 2019 and beyond
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Strong pipeline of active projects at various stages of development
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Sales in personal care for 2019 already ahead of 2018 figure
What Itaconix does:
The AIM-listed firm makes speciality polymers that are used in a wide variety of products, ranging from paints through washing liquids to mascara.
Its core technology was developed by a US company, called Itaconix Corporation, that it acquired in June 2016.
At the time of that purchase, Itaconix Plc was known as Revolymer PLC, a company that had polymer technologies of its own as well as a nicotine gum business that it sold off to Danish firm Alkalon.
On March 1, 2017, the company changed its name to Itaconix.
Brands:
Most of its products are bio-based, being derived from itaconic acid, which in turn is taken from corn starch, so the products are sustainably sourced, helping its customers improve the sustainability of their own consumer products.
Some of the brands under Itaconix’s banner include Itaconix CHT, a water conditioner for binding calcium that replaces banned phosphates; RevCare NE, a bio-based hair-styling polymer; and Eureco RP103, a product for the removal of stubborn stains.
Other products include Itaconix Velasoft, a natural skin conditioner for handwash; Itaconix Zinadore, a water soluble odour neutraliser; and Itaconix DSP, a phosphate-free water conditioner used in detergents for consumer, industrial and agricultural applications.
Inflection points:
• In May, Itaconix received its first purchase order from chemical firm Nouryon for its personal care polymer following the signing of an exclusive supply agreement in February. Nouryon, which was formerly the speciality chemicals arm of Dutch painting and coatings giant AkzoNobel, sells a wide range of products in the personal care and hair styling industries
• The firm at the start of May received the first order for its bio-based detergent polymer from what it said was a “major producer of non-phosphate automatic dishwashing detergent products”
• In a full-year trading update in February, Itaconix said its EBITDA for 2018 was in line with expectations while revenues had risen to £700,000 from £553,000 the year before. The group also ended the year with a cash balance of £2.1mln
Blue Sky:
Speaking to Proactive, Itaconix’s chief executive John Shaw said that the deal with Nouryon had “validated” the company’s business across all of its product lines and that its bio-based polymers addressed “a key need” in the personal care sector.
Looking ahead, Shaw said the deal meant there would be “faster revenue growth” in the business area, with the company sales so far in 2019 having already surpassed its 2018 sales in the personal care space.
There is also “a very robust pipeline” of opportunities, Shaw said, adding that over the coming months the firm would see a huge benefit from its deal with Nouryon.
With shares trading at around 3.3p as of 24 May 2019, Itaconix carries a market cap of £9.15mln.
