Plant Health Care announces its 2023 full year results

Date:06-06-2024

Plant Health Care^® (AIM: PHC.L), a leading provider of novel patent-protected biological products to help farmers feed the world sustainably, announced its results for the year ended 31 December 2023 ("FY23").

Financial highlights:

• Revenue in FY23 was $11.2m (2022: $11.8m)

  
  

• In the first four months of 2024, revenue was approximately $4.3m, up 72% versus the same period in 2023 (2023: $2.5m), boosted by sales to US distributors.

  
  

• Gross margin remained consistent with the prior year at 60.4% (2022: 60.9%) and has improved materially in the first four months of 2024, due to increased sales of high margin Harpinαβ and PREtec products.

  
  

• Adjusted LBITDA* improved to $2.8m (2022 $3.7m), with further improvement expected during 2024.

  
  

• Working capital utilised in the year was $5.1m (2022: $3.1m)

  
  

• At 31st December 2023, cash was $2.1m, increasing to $2.3m at 3rd May 2024. Cash burn for the same period in 2023 was $4.4m.

  
  

• Operating loss improved to $4.6m (2022: $9.2m)

*Adjusted LBITDA: loss before interest, tax, depreciation, amortisation, share-based payments and foreign exchange loss

Operational highlights:

Harpinαβ

• In the US, distributors went through a massive destocking of all products in 2023.  On-ground sales of PHC products held up well in 2023 and have started 2024 strongly, with sales of Employ^® (Harpinαβ) through Wilbur-Ellis currently up more than 75% against the same period in 2023; distributor inventory now appears to be rebalancing and to be well matched to on-ground sales.

  
  

• Sales of Harpinαβ outside the US grew by 36% led by increased sales in Brazil and Mexico of 45% and 55%, respectively.  That trend continues in 2024.

  
  

• Compounded Annual Growth rate of Harpinαβ between 2020 and 2023 is 20%; that growth trend is set to be maintained in 2024.

PREtec

• Sales of the Company's novel PREtec peptides in 2023 increased 153% to $2.0m (2022: $0.8m), reaching 18% of sales, driven by sales to new and existing customers following new product registrations.

  
  

• The Company successfully launched ObronaTM in the US for foliar use on fruits, nuts, vegetables and row crops. With the launch of Obrona, the Company sells its PREtec proprietary products on three continents.

  
  

• In Brazil, the peptide nematicide PHC68949 was granted registration for commercial sale; launches under the brand name Teikko^® will take place over the coming months. Some 10 distributors have expressed interest in selling Teikko in the upcoming growing season.  Due to strong field trials results and expected high grower ROI, multiple distributors are expressing interest in selling Teikko.

  
  

• Signed an agreement with Agrii UK to support commercial sales of a combination of the Company's PREtec technology and Agrii's novel foliar micronutrient.  The combination is designed to help growers improve crop quality and yield as part of an integrated and environmentally responsible management program.

  
  

• The Company's biochemical fungicide, PHC279, for the control of sugar cane and coffee diseases received federal approval in Brazil.

Outlook:

• New registrations and distribution agreements in 2023 and 2024 point to significant revenue growth in 2024, in line with market forecasts.

  
  

• The Company's business model is now more relevant than ever as the issue of food security continues to grow, and the farming world looks for technological solutions to achieve a sustainable future with better crops delivering higher yields and reducing environmental effects to help meet global sustainability targets.

  
  

  - H2 2024 is expected to see significant commercial progress across a number of fronts, including:

  
  

• The launch of Teikko and Moshy which are expected to deliver significant revenues in Brazil following launch.

• Expansion of Innocul8 sales in the UK, leading to further revenue expansion in the EMEAA region.

• The entry into India and now China, is expected to drive substantial sales over time.

  
  

• With increased sales in the first four months of 2024, the Group continues to assess potential non-dilutive short-term financing options to ensure it can maintain sufficient working capital and financial flexibility through its typical order cycle.

Annual Report

The Annual Report will be available on the Company's website (https://www.planthealthcare.com/investors/financial- reports-and-investor-presentations) and hard copies are expected to be posted to Shareholders in due course.

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