Symphony Environmental Technologies PLC (LON:SYM), the biodegradable plastic technology firm, said a number of orders it had expected in late 2019 have been deferred.
As a result, revenues for the second half of the year are expected to be not less than £4.1mln, which is similar to the first half of the year. Consequently, full-year revenues will be below current market expectations of £9.05mln and the company expects to make an operating loss of around £500,000.
Symphony had previously cautioned that its sales pipeline had clogged up in the first half of the year because of customers awaiting legislative clarification in certain markets and revealed today that this indecision had continued into the second half, affecting expected purchases of its d2w controlled-life plastic technology.
Net cash and cash equivalents at the end of November stood at £1.2mln , compared to net debt of around £400,000 at the end of June.
"As previously reported, we are uncertain as to the timing of when sales will increase, but we believe this will be in the short rather than longer-term,” said Michael Laurier, the chief executive officer of Symphony.
“The global issue of how to best deal with plastics is hotly debated and being resolved in different ways from country to country. The business environment that we are engaged in is complex but it continues to open many opportunities to the pipeline of technologies that we have developed,” he continued.
“Whilst these factors have affected Symphony's financial results for the year ending 31 December 2019, the board remains confident in delivering an improved financial performance going forward," Laurier declared.
Much of the product purchases that were expected in Q4 2019 have been deferred to Q1 2020 so this is largely a timing issue where contracts land.
Small-cap broker Hybridan noted that the balance sheet remains strong "and the space remains as topical as ever which has created lots of opportunities in the company’s pipeline".