The good news keeps coming for crop enhancement specialist Plant Impact (PIM:AIM). The £50.7 million cap today flags a strong start to full year 2016 trading across all its geographies, and the market likes what it hears, bidding the stock 4.6% higher to 62p.
Turnover almost doubled in the first quarter with sales in the three months to October rising to £3.7 million from £1.9 million the year before.
Veritas, the group's soy crop enhancement product, drove the lion's share of turnover, after the group received higher orders from South America ahead of the 2015/16 growing season. It's no surprise therefore that Plant Impact used this update to appraise investors of its plans to 'make a significant investment to support Veritas, expanding its field tech team of agronomists in the Cerrado and Southern growing regions.'
Shares in the company have soared 78% so far this calendar year, and Shares flagged recent full year results as a crucial milestone in its move into profitability, largely thanks to soy.
Plant Impact continues to devote up to a third of revenue to R&D and chief executive John Brubaker has told Shares that the group’s stated aim going forward is target to new crops and geographies.
This strategy is exemplified by Plant Impact’s partnership with Arysta LifeScience, the top company in West African crop protection. Arysta is working with Plant Impact to bring crop enhancement products to cocoa growers in West Africa. Cocoa is one of the few high value crops for which Africa is the essential global supplier.'
Peel Hunt sees the group as a buy with a 70p target price. ‘Plant Impact’s technology has demonstrated material improvement to crop production and the deals with Bayer and Arysta provide the company with the opportunity to build material revenue streams in two key global crops. The company has significantly enhanced its internal resources, which should accelerate the ability to commercialise the existing products as well as develop the pipeline.’