I-Tech AB (publ) (ticker: ITECH) publish the interim report for the third quarter 2023
Summary of the period
“Steady and profitable growth”
Net sales for the third quarter amounted to 32,175 (21,277) kSEK, which corresponds to an increase in sales of 51 (54) %. The operating profit amounted to 8,132 (4,802) kSEK
July to September 2023
- No significant events occurred during the period
Significant events after the end of the period
- No significant events occurred after the end of the period.
|All amounts in TSEK||2023
|Operating cash flow||17,181||9,476||35,917||15,833||20,125|
|Equity at end of period||136,470||111,678||136,470||111,678||116,035|
|Cash and cash equivalents at end of period||84,593||48,555||84,593||48,555||52,754|
The third quarter consolidates the trend of a strong sales growth with solid profitability, repeating the development over the past four quarters. The sales growth amounted to 51 (54) %, adjusted for currency this represents a strong growth compared to the previous year with 48% (26%). Sales over the quarter amounted to 32.2 (21,3) MSEK and the operating result amounted to 8,1 (4,8) MSEK i.e. 69% growth. Following a period of many interesting customer meetings, both nearby and in Asia, I sense a strong continued interest from not only our largest customer but also several other prominent paint makers.
Overall, I note that our product, Selektope is being regarded as a key component in meeting stricter emission requirements for the shipping industry. Newly tightened targets from the International Maritime Organization (IMO) are set for the industry to reach net-zero greenhouse gas emissions by or around 2050. Such a complete shift would entail use of fuel from renewable sources which increases fuel costs considerably and consequently the penalty from energy losses will be greater.
The strong market in Asia propels our sales, representing 87% of our revenues while EU stands for 13%, a slightly higher figure compared to earlier periods. According to statistics from Clarksons, Asia stands for 60- 70% of all global dry-dockings for the larger commercial shipping fleet, while more than 90% of newbuilds take place in Asia. Our sales figures mirror the global market for marine paint fairly well. I am, however, certain that the progress in EU would have been greater if end-product approvals (especially those using novel technologies) would have been approved in a speedier manner following years of significant delays.
In contrast to the past quarter, our customer mix is heavily skewed towards one specific customer while the geographical spread presents a somewhat greater variety. In the wake of our largest customer, Chugoku Marine Paints gaining market share, the demand for Selektope is increasing. It’s encouraging to see how our technology can contribute to our customers´ success.
During the quarter, I-Tech hosted a unique industry event gathering key representatives from the entire value chain with the purpose of inspiring a higher degree of collaboration to find ways to fulfill the demands on antifouling coatings set by shipowners and operators. Around 170 of the leading developers, innovators, suppliers and academics gathered in Gothenburg with a selected number of end-users to take part of this unique event that proved to be highly appreciated and needed. Apart from the overwhelming positive feedback throughout the industry, I take particular note of the clear message that biocides, although in optimised combinations, are a necessity to achieve the IMO targets to lower emissions. There are simply no viable alternatives at hand, as time is running out to control global warming.