Byotrol announces new licensing deals and confirms strong sales momentum

Byotrol, the AIM-listed Cheshire-based hygiene group, has announced two new license agreements, and confirmed continued strong trading, in a market update this morning.

Orders for its sanitising products have soared since the outbreak of the coronavirus.

The Daresbury-based group said it has agreed a technology license over Byotrol24, its EPA-registered long-lasting germ kill sanitiser spray, with a consortium of investors and experienced market professionals under the umbrella of Integrated Resources International (IRI), based in Tennessee.

The license is 10 years in term and gives exclusive rights over Byotrol 24 and patents that support it in the Americas, subject to certain clawback rights.

In return for those rights, IRI has paid to Byotrol an initial license fee of $250k and will pay a quarterly royalty payment based on product sales – with material minimum annual guaranteed payments – thereafter.

The team behind Integrated Resources is already well-known to the group, including via its sister company Advanced Hygienics, which is currently licensing a Byotrol formulation of hand sanitisers in the USA.

This new agreement immediately injects additional resources and expertise into the sales and marketing effort for Byotrol24, without losing ownership of the brand and the technology. Subsequent to this deal, Byotrol will no longer incur material costs in the US.

Byotrol said its last trading update included reference to “a material but delayed new license contract that was eventually closed in mid-April”.

Having now completed legal formalities, the group has announce this agreement is a multi-year license agreement with SC Johnson Professional, in alcohol-free hand sanitisers.

This represents a strengthening in its existing relationship, moving from a relatively short-dated supply and manufacturing agreement to a longer-term technology license with guaranteed revenues, with no changes to the previously announced market scope.

Today’s trading update revealed that, as the group starts a new financial year, it reports that sales momentum remains strong.

It expects to generate record sales in the first quarter of the year and is optimistic that high levels of demand will continue for the remainder of the first half, at least.

Sales in March and April 2020 each exceeded £1m and the group is expecting to show a similarly strong performance in May.

The order book at the end of April stood at more than £2m. The group said its supply chain is working well, despite the global shortage of biocidal ingredients, exacerbated by unpredictable national lockdowns and border closures.

Chief executive, David Traynor, said: “We continue to make and supply as much of our excellent technologies as we can and expect the current record level of sales to persist in the short-term and potentially beyond.

“Our team is now increasingly focused on the longer-term, positioning for the post COVID-19 world by entering into new agreements that will increase distribution into markets that we could not easily access ourselves and at a speed that we could not achieve ourselves.

“The agreement with Integrated Resources and the new agreement with SC Johnson Professional are two such examples and we expect to complete more as the year continues.”