Itaconix Hits Break-Even Adjusted EBITDA As Revenue Jumps 72%

Itaconix (LON: ITX), which makes specialty ingredients used in detergents and other consumer products, said on Tuesday it reached break-even adjusted EBITDA for the first time in the six months to June, as revenue jumped 72% to $8.3m.

Shares rose 6.28% to 220p in early trade, a fresh 52-week high, up from Monday’s close of 207p. The stock has climbed from a 52-week low of 97p since the company first flagged the growth on 17 July.

Tuesday’s unaudited interim results confirm figures the company pre-announced on 17 July, when shares jumped 18% on the same revenue growth and an upgraded full-year guidance. The genuinely new detail is the break-even adjusted EBITDA, a measure of underlying operating profitability, against a $0.2m loss in the same period last year. Management reiterated full-year guidance of at least $14.8m revenue and small positive EBITDA, alongside a medium-term ambition of $30m revenue.

Growth was driven by Itaconix Performance Ingredients, where revenue rose 104% to $6.7m after the company signed two new large detergent customers, pushing EMEA revenue up 166% to 49% of group sales from 32% a year earlier. Gross profit rose 74% to $3.0m, with margin broadly stable at 35.6%. Net cash and investments rose to $5.1m from $4.4m at the end of December, as operating cash flow turned positive at $0.9m versus an outflow a year earlier.

Chief executive John R. Shaw said: “Our half year results are major milestones for our commercial progress, our revenue potential, and our use of cash. We generated our fourth consecutive half of growth to achieve record revenues and break-even adjusted EBITDA whilst still investing in new long-term revenue opportunities.”

With a market capitalisation under £28m, Itaconix remains a thinly traded small-cap where much of Tuesday’s confirmation had already been priced in since July, leaving shares still short of the 220p touched intraday ahead of the results.