REG - Iofina PLC - Interim Results
11/09/2023 07:00
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RNS Number : 9327L Iofina PLC 11 September 2023
D
11 September
2023
Iofina plc
("Iofina", the "Company" or the "Group")
(AIM: IOF)
Interim Results for the six months ended 30 June 2023
Growth year on year in revenue and profit
Iofina plc, specialists in the exploration and production of iodine and
manufacturers of specialty chemical products, is pleased to announce its
unaudited Interim Results for the six months ended 30 June 2023 (the
"Period").
Revenue and profitability
H1 2023 H1 2022
$m $m % change
Adjusted EBITDA(1) 5.9 3.7 60%
Revenue 24.3 19.2 27%
Cost of Sales 16.0 13.5 19%
Gross profit 8.3 5.7 46%
Operating profit 4.9 2.8 77%
Profit Before Tax 4.7 2.6 80%
(1) see Note 9 for definition
Net cash/debt
· Net cash was $0.2m (H1 2022: net debt $2.8m), excluding lease
liabilities and after capex of $3.7m, mainly on IO#9 (capex H1 2022 $0.7m)
· Cash up 33% to $6.3m (H2 2022: $4.7m)
· Well-placed to finance our ongoing operational investment program
through a strong cash position and availability of bank finance, including
$4.0m of currently undrawn loans.
Iodine production and sales
· Produced 242 metric tonnes ("MT") of crystalline iodine during H1,
in line with 235-250MT range
· With the addition of IO#9 output, H2'23 production is on track to
meet the 325-350MT target
· Crystalline iodine sales up 122% to 169MT reflecting a return to
strong demand after impact of Covid restocking by customers at the end of 2021
· The average prices realised (100% iodine equivalent) for sales of
crystalline iodine increased by 13% from $63.27 for H1 2022 to $71.53 for H1
2023.
Commenting on today's results, Dr. Tom Becker, President and CEO stated: "The
Group delivered its best commercial performance for a first half period,
supported by the ongoing robust iodine prices and meeting our production
targets. In the process we have further improved our cash position even as we
constructed a new iodine plant, which provides us with additional capability
to fund growth projects.
"The completion of IO#9 in June 2023 is set to deliver a jump in iodine
production during the second half and we are on track to meet our H2 target
range of 325-350MT.
"We continue to successfully advance our growth plans and expect to finalise
an agreement for IO#10 soon. Additionally, the planning process of IO#11 is
already underway and we look forward to updating the market in due course on
this project, along with all business updates throughout the rest of 2023."
This announcement contains inside information for the purposes of article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of domestic law by
virtue of the European Union (Withdrawal) Act 2018.
Enquiries:
Dr. Tom Becker
CEO & President
Iofina plc
Tel: +44 (0)20 3006 3135
Nomad & Broker:
Henry Fitzgerald-O'Connor/Harry Rees
Canaccord Genuity Limited
Tel: +44 (0)20 7523 8000
Media Contact:
Charles Goodwin/Shivantha Thambirajah/Jazmine Clemens
Yellow Jersey PR Limited
Tel: +44 (0)7747 788 221/+44 (0)7983 521 488
INTERIM RESULT
Business Overview
Iofina plc ("Iofina" the "Company" or the "Group") is the holding company of a
group of companies (the "Group") in the specialty chemical industry with
unique, proven technologies and competencies for producing iodine and
halogen-based chemical derivatives. The Group's business model involves
producing a key raw material, iodine, at a low cost and in the most
environmentally friendly way possible, providing the Company's customers
vertical integration into high-quality iodine and other halogen based chemical
products.
The Company is committed to producing its products with minimal environmental
impact. The Group's iodine is produced from brine water waste streams
co-produced with oil & gas production in the United States. By utilizing a
produced waste stream to isolate iodine, Iofina is extracting a valuable
resource from a stream that would otherwise provide no use or value. Also, by
isolating iodine from these streams, Iofina avoids the additional drilling and
mining environmental impacts of many other iodine producers.
Iofina operates two active business units in the United States. Iofina
Chemical ("IC") develops and produces halogen-based specialty chemicals and
sells these products, along with the Group's crystalline iodine, globally in a
variety of applications. Iofina Resources ("IR") currently operates six
IOsorb® iodine production plants with the sixth plant starting in June 2023
and is planning for additional plant expansions. IR continues to explore for
new iodine sources and further develop its proprietary models relating to
iodine and other mineral sources in North America. Expertise in core halogen
technologies, the vertical integration of iodine into specialty products, the
diversity of iodine production plants and specialty halogen-based products,
and operating our businesses within the pillars of responsible ESG practices
are key business tenets for Iofina. The Directors are focused on the continued
prudent growth of the Group, and the development and implementation of
business strategies for the ongoing improvement of Iofina.
Financial Review
Trading results
Turnover Crystalline H1 2023 Crystalline H1 2022
Iodine 85% Sales Iodine 85% Sales
MT $m MT $m
Crystalline iodine 169 10.3 76 4.1
Derivatives 105 7.5 117 8.5
Prilled iodine 2.0 0.9
Total iodine sales 274 19.8 193 13.5
Non-iodine 4.5 5.7
Total sales $24.3 $19.2
Sales
Total sales increased by 27% from $19.2m to $24.3m, with total iodine sales up
by 47% from $13.5m to $19.8m, while non-iodine sales decreased by 21% from
$5.7m to $4.5m. Volumes of crystalline iodine sales were up significantly by
122% from 76MT to 169MT, reflecting a return to strong demand after a subdued
H1 2022 following pandemic-driven restocking by customers at the end of 2021.
The average prices realised (100% iodine equivalent) for crystalline iodine
rose by 13% from $63.27 for H1 2022 to $71.53 for H1 2023. The 21% fall-off in
non-iodine sales reflected higher inventories held by a key customer at the
beginning of 2023.
Production
Production from the Company's five existing Oklahoma plants was slightly up at
242MT for H1 2023 compared to 234MT for H1 2022. The new sixth plant IO#9 has
contributed to production since July. Average production costs per kilogram
included in trading costs of sales were 15% higher than for H1 2022, a major
factor being substantial inflationary increases in the prices of chemicals
used for processing.
Gross profit
Gross margin percentages were mainly consistent by product grouping year on
year, with iodine price increases offset by inflationary increases in costs of
production. The 42% increase in the total volume of crystalline iodine sold,
from 193MT to 274MT, was the main driver in the 46% increase in gross profit
from $5.7m to $8.3m.
Administrative expenses
Administrative expenses (excluding depreciation and amortisation) increased by
20% year on year from $2.0m to $2.4m, due to inflation effects and a greater
level of activity.
Taxation
The deferred tax expense of $1.1m (approximately 25% of profit before tax - H1
2022: $0.7m) is the continuing amortisation of the asset set up in 2021 to
recognise the value of US Federal tax losses accumulated over previous years.
The Company does not expect any US Federal tax to be payable in respect of
2023, but the losses will likely be used up in the early part of 2024 and tax
will be payable in full thereafter.
Capital expenditure
Capex for H1 2023 totalled $3.7m compared to $0.7m for H1 2022. Analysing the
capex for H1 2023, $3.2m was related to the construction of the new IO#9
plant, and after including H2 2022 capex brought the total cost of the plant
to $5.2m. This is significantly more than the original budget of $4.0m, and
reflects a number of factors, including additional requirements of the new oil
and gas partner, higher costs than expected to incorporate material from IO#5
plant and implementation of the specific configuration, and additional
inflation between the time of quote and ordering.
Cash flow and financing
Adjusted EBITDA was 60% higher at $5.9m (H1 2022: $3.7m). After additional net
working capital requirements of $1m, capex of $3.7m (mainly re IO#9 as above),
and loan repayments and interest of $0.9m, net H1 2023 cash flow was $0.4m
positive. At 30 June 2023 cash was $6.3m, and cash net of the $6.1m
outstanding on the bank term loan was $0.2m, which compares to net debt of
$2.8m at 30 June 2022. The debt to EBITDA ratio was 0.44 compared to 1.05 for
H1 2022. The Company's bank debt facilities are set out in Note 5, and include
$4.0m undrawn loans for capital projects.
Iofina Chemical
Iofina Chemical ("IC") is the specialty chemical subsidiary of the Group and
has been in business for 40 years producing a diverse array of high-quality
halogen-based chemicals for various growing industries including pharma,
biocides, human and animal health, and many others. IC is a globally
recognised leader in halogen chemicals. The Group continues to invest in IC to
increase its development capabilities to supply customers with existing and
new products. In addition to the halogen-based chemicals produced on-site at
IC's facility in Covington, Kentucky, IC is the Group's main sales and
commercial arm, selling iodine directly to the market and processing all
external sales for the Group. While the iodine production component of the
business is generally well known to investors, the Directors believe the
importance of Iofina Chemical, its diversity of products including non-iodine
offerings, and the value-add for iodine derivative products is not as well
recognised as a significant contributor to the Group.
IC achieved record first half sales, which were boosted by robust iodine
prices. Examples of product offerings that realised increased sales in the
Period versus H1'22 included methyl iodide, chloramine-T, and the Group's
produced crystalline iodine. Methyl iodide is used in acetic acid
manufacturing, synthesis of pharmaceuticals, and other specialty applications.
Chloramine-T is a broad-based biocide used as a disinfectant and sanitizer and
is also effective for odour-control. The Group's produced crystalline iodide
is sold to numerous iodine derivative manufacturers around the world.
In the Period, IC invested in its facilities and is now utilising a Hastelloy
reactor for a non-iodine product and has installed a larger capacity chiller
to support multiple iodine derivative manufacturing processes. IC will
continue to invest in its manufacturing facilities to improve current
processes and develop new halogen-based commercial processes. R&D efforts
in our newly remodelled laboratory included new product development, research
on iodide recycling opportunities, and improvements to our IPBC manufacturing
process and formulations. Post period, IC has hired an experienced sales and
marketing manager to support the growth and development of IC.
The diversity of IC's halogenated products (iodo-, chloro-, fluoro-) is key to
both the growth and the stability of the organization. Additionally, the
vertical integration of iodine into iodine derivatives provides, the Group and
its customers with stability of supply for the iodine-based compounds
produced.
Iofina Resources
Iofina Resources ("IR") identifies, develops, builds, owns, and operates
iodine extraction plants, based on Iofina's WET® IOsorb® technology. Iodide
is isolated from a brine waste stream produced from existing oil and gas
operations. Without Iofina, this resource would not be realised. The isolation
of iodine from this waste stream adds value to Iofina, its shareholders, and
our oil and gas partners and minimises environmental impact.
During the Period, IR produced 242MT of crystalline iodine from its five
plants in operation in Oklahoma. This was a 7.5MT increase when compared to
the same period in 2022. The significant news item from the Company in H1 2023
was the start-up of IR's new iodine plant, IO#9, in June 2023. The completion
of IO#9 was a substantial achievement for the Company which is now operating
six iodine production facilities in Oklahoma. This new plant, with a new oil
& gas partner, begins a new growth phase for Iofina in a new core area in
Oklahoma. Whilst the plant did not contribute to the production total in the
Period, it continues to ramp up its production and is expected to be in full
production in early Q4 2023. The ramp-up of IO#9 has proven to be more
difficult than anticipated as we work with our new partner and their
water-gathering system to optimise iodine production. With the new production
of IO#9 adding to the other five iodine plants, the Company expects to produce
between 325-350MT of crystalline iodine in H2 2023. Currently, all six iodine
plants operate in Western Oklahoma.
IR is committed to growing its iodine production and expects to double its
iodine production from 2021 levels in the next 2-4 years. IR's management is
confident that negotiations for our next IOsorb® plant, IO#10 are close to
conclusion, and once complete will progress the Company's strategic growth
plan of additional iodine production in our new core area. Iofina is committed
to continuing investments in business development for future plants, and has
recently added another geologist to the team and plans to continue to invest
in additional personnel to support current operations and fast-track business
development. Negotiations and exploration efforts for plants IO#11 and
beyond are progressing.
Iodine Market Outlook
Iodine is utilized in various applications, the largest of which is injectable
iodinated contrast agents used in medical procedures to enhance the visibility
of numerous medical diagnostic procedures. The iodine demand for contrast
agents continues to grow especially in countries that are advancing their
healthcare systems and it is anticipated that this particular end market will
be the core driver of iodine demand for the foreseeable future. Iodine is also
used in many other applications including LCD screens, pharmaceutical
synthesis, biocides, and many others.
Iodine spot prices have remained high when compared to historical iodine
prices. Iodine pricing increased from c.$50/kg at the beginning of 2022 to
c.$70/kg by mid-2022. Spot prices have fluctuated near $70/kg over the course
of the last 12 months and spot prices are currently between the upper sixties
to low seventies per kilogram.
Future iodine prices are difficult to predict. Demand for iodine and its
products remains strong. Barring any major changes in the iodine market or a
significant global economic downturn, we expect prices to remain at or near
current levels for the remainder of 2023 and into H1 of 2024. SQM has
indicated that they expect to add 800MT of production in 2023. With no other
noteworthy iodine production expected in the near term, it is unlikely that
this additional volume will affect prices significantly.
Operations Outlook
The Group continues to execute its growth plans and is committed to the
ongoing improvement of all aspects of our operations. We have invested in
safety initiatives and management systems and the Group has had no lost-time
incidents in over two years. IC is now both a Chemstewards® certified
facility and an ISO 9001:2015 certified facility. We are currently
implementing a new groupwide EHS software system.
Business Outlook
The financial position of the Group has never been better. H1'23 revenues
and adjusted EBITDA were 27% and 60% higher than H1'22 levels respectively.
Additionally, the Group recently announced in July it had improved the terms
of its loan facilities. The first phase of our multi-year growth plan is being
executed with the completion of IO#9 and we are confident that an IO#10
agreement will be completed soon signalling Iofina's commitment to this growth
strategy to increase iodine production is steadfast. These additional plants
will significantly increase our crystalline iodine production in the coming
years. Looking slightly ahead, the expectations are that external costs will
continue to rise, especially chemical raw material costs, and Iofina continues
to work with our suppliers and investigate measures to control costs
throughout the organisation.
Exploration and negotiations for future plants beyond IO#10 are progressing.
IC is exploring the production of new compounds to use more iodine by
producing more value-added iodine derivatives. Iodine market prices are
expected to continue at or near current levels in the near term. Our prime
focus is the organic growth of our business, and we will continue to re-invest
in growth projects within our core businesses whilst prudently exploring
additional external business opportunities. The Directors are pleased with the
continual improvement of the Group as the Directors looks forward to the
implementation of additional organic growth within the organisation.
IOFINA PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2023
Unaudited Audited
Six months ended Year ended
30 June 30 June 31 December
2023 2022 2022
Note $'000 $'000 $'000
Continuing operations
Revenue 24,300 19,178 42,198
Cost of sales (16,036) (13,519) (26,369)
Gross profit 8,264 5,659 15,829
Administrative expenses (2,399) (1,997) (4,361)
Depreciation and amortisation (986) (904) (1,824)
Operating profit 4,879 2,758 9,644
Other income:
Release of plant acquisition accrual - - 450
Profit before finance expense 4,879 2,758 10,094
Finance income 44 1 13
Interest payable (166) (159) (326)
Interest swap derivative liability (73) - 249
Profit before taxation 4,684 2,600 10,030
Taxation - current tax (19) - (31)
Taxation - deferred tax 8 (1,103) (675) (2,134)
Profit for the period attributable to owners of the parent $3,562 $1,925 $7,865
Earnings per share:
- Basic 4 $0.019 $0.010 $0.041
- Diluted 4 $0.018 $0.010 $0.040
30 June 30 June 31 December
2023 2022 2022
Adjusted EBITDA: 9 $'000 $,000 $'000
Profit before finance expense 4,879 2,758 10,094
Depreciation and amortisation 986 904 1,824
EBITDA 5,865 3,662 11,918
Other income - - (450)
Adjusted EBITDA $5,865 $3,662 $11,468
IOFINA PLC
CONSOLIDATED BALANCE SHEET
30 JUNE 2023
Unaudited Unaudited Audited
30 June 30 June 31 December
2023 2022 2022
Note $'000 $'000 $'000
Intangible assets 193 373 283
Goodwill 3,087 3,087 3,087
Property, plant & equipment 23,326 18,975 20,557
Deferred tax 829 3,391 1,932
Term loan - interest swap asset 176 - 249
Total non-current assets 27,611 25,826 26,108
Inventories 11,580 8,399 10,184
Trade and other receivables 11,633 6,901 10,487
Cash and cash equivalents 6,316 4,737 5,927
Total current assets 29,529 20,037 26,598
Total assets $57,140 $45,863 $52,706
Trade and other payables 9,094 5,952 7,538
Term loan - due within one year 5 1,429 1,429 1,429
Lease liabilities 106 98 101
Total current liabilities 10,629 7,479 9,068
Term loan - due after one year 5 4,642 6,071 5,357
Lease liabilities 246 366 309
Total non-current liabilities 4,888 6,437 5,666
Total liabilities $15,517 $13,916 $14,734
Issued share capital 6 3,107 3,107 3,107
Share premium 60,687 60,687 60,687
Share-based payment reserve 2,240 2,067 2,153
Retained losses (18,467) (27,970) (22,031)
Foreign currency reserve (5,944) (5,944) (5,944)
Total equity $41,623 $31,947 $37,972
Total equity and liabilities $57,140 $45,863 $52,706
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Share Share Share-based Retained Foreign Total
capital Premium payment losses currency equity
reserve reserve
$'000 $'000 $'000 $'000 $'000 $'000
Balance at 31 December 2021 (Audited) $3,107 $60,687 $2,007 $(29,896) $(5,944) $29,961
Share-based expense - - 146 - - 146
Total transactions with owners - - 146 - - 146
Profit for the year attributable to owners of the parent - - - 7,865 - 7,865
Total comprehensive income attributable to owners of the parent - - - 7,865 - 7,865
Balance at 31 December 2022 (Audited) $3,107 $60,687 $2,153 $(22,031) $(5,944) $37,972
Share-based expense - - 87 - - 87
Total transactions with owners - - 87 - - 87
Profit for the period attributable to owners of the parent - - - 3,562 - 3,562
Total comprehensive income attributable to owners of the parent - - - 3,562 - 3,562
Balance at 30 June 2023 (Unaudited) $3,107 $60,687 $2,240 $(18,467) $(5,944) $41,623
IOFINA PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2023
Unaudited Audited
Six months ended Year ended
30 June 30 June 31 December
2023 2022 2022
$'000 $'000 $'000
Cash flows from operating activities
Adjusted EBITDA 5,865 3,662 11,468
Share options expense 87 60 146
Release of plant acquisition accrual - - 450
5,952 3,722 12,064
Changes in working capital
Trade receivables (increase) (1,444) (977) (4,329)
Inventories (increase) (1,396) (2,103) (3,888)
Trade and other payables increase 1,856 388 1,737
Net cash inflow from operating activities 4,968 1,029 5,584
Cash flows from investing activities
Interest received 44 1 13
Acquisition of property, plant & equipment (3,665) (675) (3,087)
Net cash outflow from investing activities (3,621) (674) (3,074)
Cash flows from financing activities
Term loan repayments (714) (714) (1,429)
Interest paid (161) (154) (311)
Lease payments (65) (12) (74)
Net cash outflow from financing activities (940) (880) (1,814)
Tax paid/accrued (19) - (31)
Net increase/(decrease) in cash 388 (525) 665
Cash and equivalents at beginning of period 5,927 5,262 5,262
Cash and equivalents at end of period 6,315 4,737 $5,927
1. Nature of operations and general information
Iofina plc is the holding company of a group of companies (the "Group")
involved primarily in the exploration and production of iodine and the
manufacturing of halogen-based specialty chemical derivatives. Iofina's
principal business strategy is to identify, develop, build, own and operate
iodine extraction plants, with a current focus in North America, based on
Iofina's WET® IOsorb® technology. Iofina has current production operations
in the United States, specifically in Kentucky and Oklahoma. The Group has
complete vertical integration, from the production of iodine from produced
brine waters to the manufacture of the chemical end-products derived from
iodine and sold to global customers.
The address of Iofina plc's registered office is 48 Chancery Lane, London WC2A
1JF.
Iofina plc's shares are listed on the London Stock Exchange's AIM market.
Iofina's consolidated financial statements are presented in US Dollars, which
is the functional currency of the operating subsidiaries.
The figures for the six months ended 30 June 2023 and 30 June 2022 are
unaudited and do not constitute full statutory accounts. The comparative
figures for the year ended 31 December 2022 are extracts from the 2022 audited
accounts (which are available on the Company's website and have been delivered
to the Registrar of Companies) and do not constitute full statutory
accounts. The independent auditor's report on the 2022 accounts was
unqualified and did not contain statements under sections 498(2) or (3)
(accounting records or returns inadequate, accounts not agreeing with records
and returns or failure to obtain necessary information and explanations) of
the Companies Act 2006.
2. Accounting policies
The basis of preparation and accounting policies set out in the Annual Report
and Accounts for the year ended 31 December 2022 have been applied in the
preparation of these condensed consolidated interim financial statements.
These interim financial statements have been prepared in accordance with the
recognition and measurement principles of the International Financial
Reporting Standards (UK adopted IFRS) that are expected to be applicable to
the consolidated financial statements for the year ending 31 December 2023 and
on the basis of the accounting policies expected to be used in those financial
statements.
3. Segment reporting
(a) Business segments
The Group's operations comprise the exploration and production of iodine with
complete vertical integration into its specialty chemical halogen derivatives
business and are therefore considered to fall within one business segment.
3. Segment reporting (continued)
Unaudited Audited
Six months ended 30 June 31 December
2023 2022 2022
Assets $'000 $'000 $'000
Halogen Derivatives and iodine 57,140 45,863 52,706
Total $57,140 $45,863 $52,706
Liabilities
Halogen Derivatives and iodine $15,518 $13,916 $14,734
Total $15,518 $13,916 $14,734
(b) Geographical segments
The Group reports by geographical segment. All the Group's activities during
the period were related to exploration for, and development of, iodine in
certain areas of the USA and the manufacturing of specialty chemicals in the
USA with support provided by the UK office. In presenting information on the
basis of geographical segments, segment assets and the cost of acquiring them
are based on the geographical location of the assets.
Unaudited Audited
Six months ended 30 June 31 December
2023 2022 2022
Total assets $'000 $'000 $'000
UK 281 179 96
USA 56,859 45,684 52,610
Total $57,140 $45,863 $52,706
Total liabilities
UK 145 116 153
USA 15,372 13,800 14,581
Total $15,517 $13,916 $14,734
Capital expenditures
UK - - -
USA 3,665 675 3,087
Total $3,665 $675 $3,087
4. Earnings per share
The calculation of earnings per ordinary share is based on profits of
$3,562,521 (H1 2022: $1,925,372) and the weighted average number of ordinary
shares outstanding of 191,858,408 (H1 2022: 191,858,408). After including
the weighted average effect of share options of 5,393,650 (H1 2022: 3,966,173)
the diluted weighted average number of ordinary shares outstanding was
197,252,058 (H1 2022: 195,824,581).
5. Bank loan facilities
Term loan
$'000
At 31 December 2021 $8,214
Term loan instalment repayments (1,429)
At 31 December 2022 $6,785
Term loan instalment repayments (714)
At 30 June 2023 $6,071
Due within one year 1,429
Due after one year 4,642
$6,071
Bank facilities are with First Financial Bank of Ohio, are fully secured by
fixed and floating charges, and the principal terms are:
Term loan
a) The term loan balance of $6.8m (2021 $8.2m) relates to a $10.0m loan drawn
down in September 2020 and repayable in full by equal monthly instalments over
the seven years to 30 September 2027. The interest rate on $7 million of the
loan has been fixed to maturity by a swap contract at 3.99%, and the interest
rate on the balance is variable monthly at 2.50% above the one month Secured
Overnight Financing Rate ("SOFR"), subject to a minimum SOFR rate of 1.00%.
Repayment of all or part of the loan may be made at any time without penalty.
Revolving loan facility
b) The revolving loan facility is for $6.0m over the period to 16 September
2025, and may be drawn and repaid in variable amounts at the Group's
discretion. Amounts that may be drawn are subject to a borrowing base of
sufficient eligible discounted monthly values of receivables and inventory,
and compliance on a quarterly basis with trailing 12 months financial covenant
ratios of 1) a maximum multiple of 2.5 total debt to EBITDA, and 2) a minimum
multiple of 1.2 EBITDA net of capital expenditure to the total of principal
and interest payments on the total debt. The interest rate is variable monthly
at 2.11% above SOFR, subject to a minimum SOFR rate of 1.00%. Iofina is
currently not drawing on this line of credit.
Project loan facilities
c) There is a $4 million term loan with a drawdown period through to July 1,
2024 to be used for IO#10 plant expenditures and other Capex projects as
appropriate. A seven-year term begins from July 1, 2024 with interest payable
during the drawdown period. The interest rate is 2.11% plus SOFR (1 month
Secured Overnight Financing Rate) subject to a minimum of 1%. No drawings have
as yet been made on this loan.
6. Share capital
Unaudited Unaudited Audited
30 June 30 June 31 December
2023 2022 2022
Authorised:
Ordinary shares of £0.01 each
-number of shares 1,000,000,000 1,000,000,000 1,000,000,000
-nominal value £10,000,000 £10,000,000 £10,000,000
Allotted, called up and fully paid:
Ordinary shares of £0.01 each
-number of shares 191,858,408 191,858,408 191,858,408
-nominal value £1,918,584 £1,918,584 £1,918,584
7. Share based payments
On 27 April 2023 options over 1,196,700 ordinary shares of the Company,
representing 0.62% of the Company's issued share capital at that date, were
granted to directors and key management personnel. The options are exercisable
at the closing share price on 27 April 2023 of 31.75p per share, with 50%
vesting after one year on 27 April 2024 and 50% vesting after two years on 27
April 2025. The options expire ten years from the date of grant. The above
options were valued using the Black Scholes model and the exercise price of
31.75p, an expected term of 5.75 years, historical volatility of 69.07% and a
risk-free rate of 3.59%. The resulting valuation of $300,355 is being
amortised over the vesting periods, and $39,409 has been charged as an expense
in respect of the period from 27 April 2023 to 30 June 2023. No options
lapsed or were forfeited or exercised during the six months to 30 June 2023.
There were 6,197,100 total options outstanding at 30 June 2023, representing
3.23% of shares in issue.
8. Taxation - deferred tax
The deferred tax charge of $1,103k (H1 2022 $675k) relates to amortisation of
the $4.07m deferred tax asset set up in the balance sheet at 31 December 2021
to recognise $19.4 million of accumulated US Federal tax losses expected to be
available for offset against future profits.
9. Adjusted EBITDA
Management uses certain non-IFRS performance measures to assess performance of
the Group, and considers them to provide useful supplementary information to
the IFRS results. EBITDA is profit before finance expense adjusted to exclude
depreciation and amortisation, and Adjusted EBITDA additionally excludes
exceptional items of non-recurring income and expense. Management considers
that this latter measure provides a fair representation of the period's
operating results excluding non-cash items. A reconciliation to Profit before
finance expense is set out below the Consolidated Statement of Comprehensive
Income.
10. Cautionary Statement
This report contains certain forward-looking statements with respect to the
financial condition, results of operations and businesses of Iofina plc. These
statements are made by the directors in good faith based on the information
available to them up to the time of their approval of this report. However,
such statements should be treated with caution as they involve risk and
uncertainty because they relate to events and depend upon circumstances that
will occur in the future. There are a number of factors that could cause
actual results or developments to differ materially from those expressed or
implied by these forward-looking statements. Nothing in this announcement
should be construed as a profit forecast.
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