23rd Jul 2009 07:00
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For immediate release |
23 July 2009 |
There will be a conference call for investors and analysts to discuss this announcement today at 11:00 (BST). Dial-in details are as follows: UK Access Number: +44 (0)20 8609 1435, US toll free number: 1866 793 4279, PIN code: 356088#. A replay of the conference call will be available for one month via UK: 0800 358 2189 or 020 8609 0289, US: 1 866 676 5865. Conference reference number: 268811#.
TYRATECH, INC.
("TyraTech" or "the Company")
Trading Update
TyraTech, Inc. (AIM: TYR), a leading independent novel clean technology company for human, animal and environmental health, today provides an update on trading for the six month period ended 30 June 2009. The Company will announce its interim results on 16 September 2009.
Product sales for the first half of 2009 continue to grow, supported particularly by the Company's first orders of insecticide by its new partner, Terminix. However, the Board anticipates that revenues and profits for the full year 2009 will be significantly below current market expectations. Cash balances are expected to be at or near market expectations at year end. The reduction in revenue projection ties to a reduced activity in certain low-margin business areas, and the difficulty in accurately forecasting the size and timing of new orders for the Company's major commercial businesses - notably its commercial partner Terminix and its Sustainable Solutions division - that are otherwise showing material sales growth. Directors' expectations of year end cash levels being near to, or at, current market expectations are due to improved working capital management and close operational management of expenses and have been arrived at, assuming revenue from contracts in hand or which are close to completion.
While additional contracts and orders are expected in 2009, the Company will communicate these developments to the market, when they are accurately known.
TyraTech's main commercial programs are progressing well. The development project with Kraft Foods is on track for 2009 and no reductions in revenue are expected. TyraTech's partnership with Terminix has developed ahead of schedule and has already led to two major product orders, the first of which has been delivered and the second of which is scheduled for the next few weeks. Terminix's marketing of the SafeShield insecticide product is only in the initial stages, and though underway, accurate forecasting of new orders is difficult until some experience is gained.
TyraTech's other partnerships with Arysta and TyraChem are continuing to develop well and the Company will provide guidance to the market as significant changes in revenue expectations occur.
One line of projected business revenue for 2009 was expected though the Company's commercial partner in India. Based on difficulties in getting payments and slow market development of what has been a low margin opportunity, TyraTech will no longer continue this commercial activity, and has included this decision in its revised guidance.
TyraTech's Sustainable Solutions business is progressing well with a significant amount of interest in the division's products. Revenues for the year are largely to come from the sales of its WasteSolver and SolidSolver equipment to dairy farms for effective waste management. Sales have been adversely affected largely due to the price of milk in the USA, which has dropped by 44% since January 2008, and dairy farmers are cautious about taking on new financial commitments. This situation has resulted in a reduction in the projected revenue for 2009. However, the level and rate of completed purchase contracts has increased in late Q2 2009, and the business is expected to show revenue growth through 2009 as new installations are commissioned. TyraTech has engaged advisors to explore bringing in a new strategic investor to further accelerate its rate of growth.
Commenting on the announcement, Douglas Armstrong Ph.D., Chief Executive Officer of TyraTech, said: "In 2009, TyraTech has successfully demonstrated a transition from the development state to a growing commercial company with several product lines and market adoption. Revenues are on the rise led by our relationships with Terminix and Kraft Foods, along with the progress in our Sustainable Solutions Division. Our multiple paths of revenue business model is beginning to clearly be demonstrated.
"While the business operations have progressed well, we are cautious about how quickly our markets will expand and we are therefore carefully controlling our costs and working capital investments. We remain positive that we can execute our business plan and strategy and that there is a potential for high gross margins on products and additional material payments from partnering and licensing deals. We believe that we will be able to evidence this progress through announcements during the rest of 2009 and we will carefully expand expectations as the business grows into 2010."
For further information please contact:
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TyraTech Inc.
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Douglas Armstrong Ph.D., Chief Executive Officer
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+1 (321) 409 7723
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Keith Bigsby, Chief Financial Officer
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+1 (321) 409 7714
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www.tyratech.com
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Nomura Code Securities
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Charles Walker / Clare Terlouw
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+44 (0)20 7776 1200
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www.nomuracode.com
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Buchanan Communications
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Mary-Jane Elliott / Lisa Baderoon
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+44 (0)20 7466 5000
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/ Catherine Breen / Stasa Filiplic
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www.buchanan.uk.com
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About TyraTech
TyraTech was formed in 2004 to develop and commercialise products for the control of invertebrate pests and pathogens using the Company's proprietary technology. TyraTech, which already has a product on the market, is positioned for human health, animal health and pesticide market opportunities which total over $32 billion globally. TyraTech's technology provides the Company with a wide variety of product and business opportunities in many markets and geographic regions. The differentiating feature of these products is the potential to have a combined level of potency and safety that other invertebrate control products are unable to offer. TyraTech's platform brings many of the principles of drug discovery and development to the fields of insecticides and parasiticides. By targeting specific chemoreceptors that are found in invertebrates but not in humans and animals, TyraTech can produce products that use natural plant derived compounds targeting these receptors.
TyraTech's plan for the use of its technology is to develop selected proprietary active ingredients which can then be used across a wide variety of market segments, either by development partners or by TyraTech itself. TyraTech already has products or partnerships in the areas of professional and horticultural insect control. TyraTech also has an innovative partnership with Kraft to use its natural oils to develop functional foods for improving the health of the more than 2 billion people worldwide subject to intestinal parasitic infections.
TyraTech also has a separate technology with associated intellectual property that is the basis for the Sustainable Solutions business. This technology has been incorporated into specialised dairy farm equipment for processing cattle manure waste to a usable material for TyraTech to sell as a commercial plant growing medium. For more information please visit www.tyratech.com.
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