Biome Technologies expects Bioplastics revenue delay to hit earnings

Biome Technologies expects Bioplastics revenue delay to hit earnings
Biome Technologies expects Bioplastics revenue delay to hit earnings

(Alliance News) – Biome Technologies PLC warned Monday that full-year revenue would be “materially below current market expectations.”

In response, shares of the biodegradable plastics and advanced radio frequency systems company, based in Southampton, England, fell 43% to 40.00 pence in London trading Monday morning. The stock fell as low as 33.00 pence, setting a new 52-week low.

Biome Technologies said a revenue recovery at its Bioplastics division is now likely to occur later in 2024 than previously expected.

Additionally, the company highlighted signs that the broader North American coffee packaging market, to which Biome is exposed, is not as dynamic as in prior periods.

Biome painted a more positive picture of its RF Technologies division, where contract wins are expected to translate into “significant” revenue in 2024.

However, Bioplastics’ delays will result in lower sales and profits, the company warned.

Biome said the revenue reduction will be partially offset by higher margins and lower overhead costs. However, the company expects a small loss before interest, taxes, depreciation and amortization for 2024.

Biome said working capital management will be a key priority in the second half of the year and the board is exploring ways to ensure sufficient working capital going forward.

Biome said it had a cash balance of GBP600,000 as of June 30, had no bank debt and had GBP1.3 million in convertible bonds outstanding.

By Jeremy Cutler, Alliance News reporter

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