I-Tech AB (publ) Year-end report 2020
Summary of the period
” A challenging but overall strong year ”
- Net turnover for the period amounted to kSEK 11 188 (14 584), which corresponds to a decrease in turnover of -23 % (34 %). Operating profit/loss amounted to kSEK -3 507 (-915).
- Net turnover for the full year 2020 amounted to kSEK 52 819 (45 574), which corresponds to an increase in turnover of 16 % (57 %). Operating profit/loss amounted to kSEK -5 167 (-7 019).
January to December 2020
- In March, the leading Norwegian paint manufacturer, Jotun, launched two new marine paints based on I-Tech’s proprietary antifouling active agent Selektope®.
- During March, Per Svensson was appointed Sales Director for I-Tech. Per comes most recently from Emerson Automation Solutions where he was Director of Global Sales and Aftermarket Marine Solutions.
- I-Tech renewed and upgraded the regulatory status for Selektope® in Japan.
- At the Annual General Meeting in May, Chatarina Schneider and Tomas Bergdahl were elected as new Board Members, replacing Leif Darner and Mats Enegren.
- I-Tech announced that deliveries for the order to Chugoku Marine Paints communicated by I-Tech in August 2019, were partly delayed due to the Corona pandemic.
- In December, I-Tech signed a long-term collaboration agreement with Pettit Marine Paint, a U.S.-based supplier of high-performance antifouling paints. The collaboration will focus on the development and approval of Selektope®-based paints for the American leisure boat market.
Important events after the period
• No important events have occurred after the period.
Financial Summary
| All amounts in TSEK | 2020Oct-Dec | 2019Oct-Dec | 2020Jan-Dec | 2019Jan-Dec |
|---|---|---|---|---|
| Net sales | 11 188 | 14 584 | 52 819 | 45 574 |
| Operating result | -3 507 | -915 | -5 167 | -7 019 |
| EBITDA | -718 | 1 145 | 3 600 | 1 220 |
| Net result | -3 119 | 14 353 | -4 806 | 8 427 |
| Operating cash flow | -1 785 | -663 | 5 388 | -4 763 |
| Equity at end of period | 106 602 | 111 408 | 106 602 | 111 408 |
| Cash and cash equivalents at end of period | 40 981 | 38 940 | 40 981 | 38 940 |
CEO comments
With a strong start of the year, well in line with ambitious longer term growth targets, we experience the cold effects of the global situation in the second half. Sales for the full year grew by 16 % to 52,8 MSEK (45,6) while fourth quarter sales amounted to 11,2 MSEK (14,6), a decline of 23 %. Despite the challenges, which are of a temporary nature and above all arising from external factors, we show a year of both growth and positive cash flows. I see it as a message of strength for the technology and take note of the customers’ continued growing interest.
The fourth quarter marked an interruption in our six- straight quarters of positive EBITDAs. However, the year remains in black figures on an operational level. Consequently, EBIT for the fourth quarter amounted to SEK -3,5 (-0,9) million and SEK -5,2 (-7) million for the full year.
With a weakened USD and the pandemic, external factors have had an unusually high impact on the business in 2020. For I-Tech, the effects became visible in the last two quarters and certainly in the fourth quarter. However, there are some strong aspects to build on moving forward. We demonstrated double-digit growth over the year with a slightly improved gross margin, 48 % (46%), despite significant disruptions in supply chain encountered mainly during the second quarter. Furthermore, operational cashflow shifted from larger negative numbers in 2019 to positive figures in 2020 ending at SEK 5,4 (-4,8) million, which is a strong figure considering a negative operational cash flow in the fourth quarter, SEK -1,8 (-0,7) million.
As our cash balance remains strong and the underlying business moves in the right direction, we continue to view our business on a long-term horizon, and we will initiate investments as per our strategy. We expect to be able to offer better know-how to our customers in terms on how to use Selektope® to develop more efficient and sustainable antifouling coatings in the future. Investments will also be made in mandatory and predefined regulatory renewal processes for the European Market as well as other regulatory processes required to open new markets. Such activities will impact our cash-flow and the financial result over the coming year.
One such example was announced in the final days of the fourth quarter wherein I-Tech and Pettit Marine Paints entered into a cooperation agreement to bring new Selektope®-containing antifouling products to the US leisure boat market in a few years’ time. Both parties are investing to reach a range of US-EPA approved paint-products to improve sustainability and performance aspects for leisure boat owners, an antifouling market worth around 200 MUSD in antifouling coating sales.
In closing 2020, a year that initially was expected to have a far steeper growth curve, I conclude that the world largest marine paint maker, Jotun, launched two advanced antifouling products containing Selektope® to the market. Furthermore, all customer accounts (four major contributing customers) are growing and as I look to 2021, I see more of optimism and positivity in the market than what has been seen in the past 8-10 months.
I am excited to move into this new year, a year of important investments on the one hand and a more exciting business climate on the other and with a shipping industry that is regaining momentum and investing in a green transition to adopt existing and new requirements to become a more sustainable transport sector.
Philip Chaabane, CEO
M: +46 073-910 37 08
E:
ph*************@i-****.se
About I-Tech AB (publ)
I-Tech is a biotech company that has developed and sold the product Selektope®, an active substance that counteracts marine growth on surfaces such as ships and boat hulls, but also other marine installations. By increasing the resistance to growth in marine paint systems (e.g Antifouling coatings), fuel and maintenance costs are reduced. I-Tech has obtained the necessary regulatory approvals for Selektope and has several of the world's largest manufacturers of marine color as customers. The company's share is listed for trading on Nasdaq First NorthGrowth Marketin Stockholm with Erik Penser Bank as Certified Adviser, phone: +46 (0)8 463 83 00, email:
ce**************@pe****.se
. For further information, see: www.i-tech.se.
About Selektope®
Selektope® introduces, for the first time, a pharmacological mode of action to combat barnacle settlement. By temporarily stimulating the octopamine receptor, the barnacle larvae’s swimming behavior is activated and the organisms are deterred from the hull. These ground-breaking discoveries enable unrivalled power at very low concentrations, yet within the limits of rigorous risk assessments. Selektope® is an organic, non-metal compound with efficacy proven at 0.1% w/w. For more information visit our website www.selektope.com.
This is information that I-Tech AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 08:00 CET on 24 of February 2021.
