Zotefoams Share Discussion Threads

[battlebus2] 12/8/2014 07:42

Very pleased with todays results, lots to look forward too with MEL including a small increase in the dividend to 1.75p. The only downsides i can see are the currencies and an increase in debt.

Outlook

Demand remains strong in our Azote(R) Polyolefin foams business and we expect that this, along with some inventory increases at customers, will result in volume growth in all major regions in the second six months of the year. The price of LDPE, which has been relatively stable this year, has increased in July reacting to short-term supply constraints. However we expect the Euro prices for the remainder of the year to be relatively similar to 2013 unless driven by changes in the price of crude oil. In our HPP business sales grew by 51% in constant currency due to uses in aviation, clean-room insulation and general industrial markets and applications in these areas provide a solid base for second half sales to exceed those of the first six months. MEL's record order book also provides a leading indicator of strong future growth justifying our continued investment in this business. Foreign exchange rates are currently unfavourable for our business and, if they remain at the current levels, we expect second half sales to be adversely impacted by approximately 4% compared to exchange rates for the same period in 2013.

In the first half of 2014 we delivered a constant currency increase of 12% in Total Revenue and made significant capital investments to support our medium and longer-term growth potential. We enter the second half of the year with a good order book across all segments of our business and a strong portfolio of products to deliver further organic growth. Zotefoams continues to maintain a consistent strategy and approach while being mindful of economic uncertainty and the impact of foreign exchange in particular. We therefore remain confident in the long-term prospects for the business.

[coolen] 08/8/2014 22:18

That trade at 232p was a delayed trade from 2 days earlier when the price was a touch higher.

Since then, there's been plenty of stock available at 230p although I've also taken a slug out of the market, albeit not expecting a short term gain.

[battlebus2] 07/8/2014 18:26

Looks like a sizeable buy of 36k at 232.

[exbroker] 07/8/2014 14:34

There is a bit of stock in the market, most small caps feel offered and drifting, there is no reason to rush in ahead of the figures, the upside comes from a good update on the HPP and Mucell.

[battlebus2] 06/8/2014 17:35

Thanks exbroker, seems to be red on a daily basis now.

[exbroker] 04/8/2014 16:04

I think the currencies are hurting more than helping at the moment, figs on the 12, they are doing a lot of meetings the rest of that week I will report back what they say.

[battlebus2] 03/8/2014 18:48

Welcome back Woodcutter, i think the decision to turn a production line into the new technology shows the emphasis the company have in this new process and the possibilities they see for growth. This could be a pivotal moment in the co's history if proved successful and we can roll it out across the board, either way a great company to be holding imv.
Not sure how the currencies are effecting things.

[woodcutter] 23/7/2014 11:58

Having sold some time back i bought back in today with a small purchase.

The spike up was looking over cooked and supported by the TA but it's now settled so hopefully H1 will deliver decent figures.

I'd like to see HPP division continue it's revenue growth phase. If they can do 50% yoy that would be some achievement.

The FA looks compelling once the unilever deal is rolled out to other producers. Having said that the MuCell technology has the smallest revenue but very good growth potential.

No real strong TA at present and on reflection i should've held for the long haul. Will add depending on results.

dyor aimho etc etc

Woody

[exbroker] 02/7/2014 23:02

And thats how a market maker long of stock gets out of it!!

[battlebus2] 02/7/2014 12:06

Continuing to be marked up on every buy.

[battlebus2] 02/7/2014 07:38

Thanks Exbroker, made me laugh.

[exbroker] 01/7/2014 22:51

There is a buyer and seller trying to get together, so far no luck.
The other Broker Charles Stanley have an add and target of 285. The analyst cant sit the right way around on a toilet without help............
This is becoming an IP business and less of a manufacture, long term can only be good for the rating.

[battlebus2] 01/7/2014 18:51

Another good day here on relatively little volume, looks like they are marking these up to a more sensible level.

[battlebus2] 30/6/2014 18:18

Forgot to mention Investec lifted it's rating from add to buy today with a £3 target.

[battlebus2] 30/6/2014 18:12

Finished the day well on only a few k shares bought :))

[exbroker] 30/6/2014 12:55

Market are long so happy to see them better, there is about 150k still floating about......

[battlebus2] 30/6/2014 11:46

Well we have gone positive so can't be much stock left to place Exbroker.

[battlebus2] 30/6/2014 11:23

Thanks exbroker. Yes i thought that myself it's better if we keep control of it.

[exbroker] 30/6/2014 11:10

Hi bb2
There is still a bit of stock around from the indexing punters, I am trying to get this placed in safe hands, watch to see any volume.
I agree a good update MEL must have a lot of upside if the boys have switched a production line to R&D that would have taken some debate.
Good to see the technical side staying in the UK and not in the US.

[battlebus2] 30/6/2014 07:07

Looks like we are going all out with the new MEL technology....A good update imv.

High single-digit percentage volume growth in its Polyolefin business.
A very strong performance in our High-Performance Products business with growth approaching 50% in constant currency. Revenue from our MuCell Extrusion ("MEL") technology licensing business is expected to be at similar levels to the first six months of 2013

Trading Update

30 June 2014 - Zotefoams, a world leader in cellular material technology, is issuing this trading update for the first six months ended 30 June 2014.

For the first six months of 2014 the Company expects to have experienced high single-digit percentage volume growth in its Polyolefin business. We also expect a very strong performance in our High-Performance Products ("HPP") business with growth approaching 50% in constant currency. Revenue from our MuCell Extrusion ("MEL") technology licensing business is expected to be at similar levels to the first six months of 2013, although activity levels are high and the forward order book for machinery gives us confidence in our growth expectations for this business.

Recent technical innovations at MEL have shown extremely promising results in foaming a variety of polymers outside MEL's core focus on the consumer packaging market. Many of these materials are used in technical applications and have synergy with Zotefoams' HPP business but require further technical and market development. Given their longer-term nature Zotefoams has decided that the best way to exploit these innovations is to develop further expertise at its Croydon, UK site. This allows MEL to retain focus on existing products and markets while benefiting from our UK-based marketing and technical personnel.

Zotefoams' existing microZOTE(R) extrusion line, which was initially specified for the dual purposes of development and manufacturing, will now be used as a development line with manufacturing activity on this line curtailed. Following this decision by the Board the Company will take a one-off charge which is expected to be approximately GBP1.2 million for the write-down of these assets. This charge, which will have no cash effect, will be treated as an exceptional item in the Group's financial results for the six month period to 30 June 2014.

As a predominantly UK-based exporter we are influenced by raw material prices and currency. For the year to date the average euro price of our main raw material, LDPE (low density polyethylene), has been similar to the average euro price for 2013. With the strengthening of sterling in 2014 compared to 2013 we will benefit slightly from purchasing LDPE in euros although this will be outweighed by the impact on our foreign currency sales and assets.

Overall the Board remains confident of a satisfactory outcome for the year and continued progress in the future.

The Company expects to announce its interim results for the six months ended 30 June 2014 and provide an update on current trading on Tuesday, 12 August 2014.

[battlebus2] 19/6/2014 22:44

Thank you Exbroker.

[exbroker] 19/6/2014 22:40

The trade today was a fund to fund.

[battlebus2] 19/6/2014 10:14

Yes not sure what to make of it though they did lower the mid late on yesterday to accommodate it, exbroker may have a view. Not long to the trading update if they release on as per last year 8th July.

[janeann] 19/6/2014 09:31

and a 213000 share trade at mid price.

[battlebus2] 18/6/2014 12:22

Late reported 20k buy at 247.75, can't be much stock around now.