Stanelco (LON:SEO), the diversified industrial engineering group, this morning delivered an upbeat assessment of its performance since the start of 2010, with news that sales to March 31 were up 26% to £2.6m on a like-for-like basis.
The update came on the same day as the company released its results for the year to December 31, 2009, which saw group revenue rise by 21% to £17.9m, ahead of market expectations. Losses before tax increased to £3.6m from £0.5m in 2008.
Both its BioPlastics and Radio Frequency Applications divisions enjoyed 23% increases in sales during the year, with the only blot on the landscape being a legal action brought by Novamont S.p.A against Stanelco’s 50/50 joint venture Biotec in Germany. The patent infringement case has so far found in favour of Biotec but the legal costs are nevertheless impacting on group profits.
The company closed the first quarter of 2010 with £2.4 million of cash and said it was preparing to raise up to £3.5 million through a placing and open offer to fund ongoing working capital requirements and group development.
At its Biome Bioplastics division, revenue surged by 76% on the first quarter of 2010, with advances made on a number of key accounts. Elsewhere, the RF Applications business grew by 58% and is enjoying a stronger pipeline of orders. Finally, sales at Biotec grew by 7%.
Paul Mines, Stanelco’s chief executive, said: “2009 was another year of sales growth and reducing operating loss. The new bioplastic product launches have been received positively by our customers and the markets. Our strategy to build a leading bioplastics business, well founded on good science, excellent applications engineering and deep relationships with blue-chip clients is maturing and accelerating. I am delighted to see the level of indicative support we have received already for the placing element of the current fundraising.”
The company’s shares were trading 12.5% lower at 0.28p.
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