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Symphony Environmental (SYM) Shares Fell 10.5% on £1M Equity

Simon Mugo trader
Updated 1 Aug 2022

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Key points:

  • Symphony Environmental shares plunged 10.5% on a £1m capital raise.
  • The company also released a trading update for the first half of 2022.
  • Its revenues plunged, fueling the drop in its share price.

The Symphony Environmental Technologies plc (LON: SYM) share price plunged 10.5% after announcing that it had raised £1 million via an equity subscription of 5.55 million ordinary shares sold at 18 each, representing a discount to Friday’s closing price.

Investors reacted negatively to the discounted share price offered to the new investor, given that SYM shares fell 10.5% to trade at 17p following the announcement. As a result, the sustainable plastics and rubber products company sold the shares to Sea Pearl Ventures Limited.

Also read: 12 Best Shares To Buy As A Beginner.

The market’s reaction to the announcement was significantly adverse, given that the new shares were sold at a 5% discount to Friday’s closing price, yet SYM shares fell 10.5% today. The sustainable plastics company also granted 4 million warrants to Sea Pearl Ventures, which are exercisable at 25p each within a year of the subscription.

Symphony Environmental also noted that it had transferred the entire ownership interest of Vincel Holdings Sea Pearl Ventures, which will now own 17.4% of Symphony. Sea Pearl is owned by Mrs shruti Lohia, the daughter of Mr S P Lohia, the chairman of Indorama Corporation, Singapore.

Symphony also released a trading update for the six months that ended 30 June 2022, where it generated revenues worth £3.0 million, representing a significant drop from the £4.9 million recorded in H1 2021.

The company attributed the lower revenues to short-term logistics and resource issues, which have since been resolved. Revenues from its d2p (designed to protect) product range rose 300% to £345,000 compared to the £111,000 recorded in a similar period last year.

Symphony Environmental’s board reiterated its belief that its full-year revenues and profits will meet market expectations. Some of the report’s key highlights included signing a supply agreement with Groupo Bimbo or Symphony’s d2p AM bread technology, which is FDA approved.

The company also signed a $340,000 contract with Rivulis Irrigation Ltd for its d2p AI products, with more orders expected in H2. The company’s d2w products also received regulatory approval in Peru, with regulatory approvals expected in other Central and South American countries.

*This is not investment advice. Always do your due diligence before making investment decisions.

SYM share price.

Symphony Environmental share price 01-08-2022
Source: Tradingview

Symphony Environmental share price plunged 10.52% to trade at 17.00p, falling from Friday’s closing price of 19.00p.

Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading