Hygiene group buoyed by second half performance

Hygiene group Byotrol said its second half performance, to March 31, 2022, is showing significant improvements in product sales, against the first half, in a trading update by the Daresbury-based business today.

It said its order book remains strong in the year end and it expects product sales for the year of £5.2m which, although below the previous year, are in line with the results which were inflated by three months of COVID-related demand.

Byotrol said its results for the full year depend on exactly which IP (intellectual property) agreements it is able able and, dependent on terms, willing to close in the next four weeks.

If it does not conclude any large IP sales, it expects overall revenues to be no less than £6m, with positive underlying EBITDA for the year.

If this is the outcome for the year, it expects to conclude a number of IP sales in the first half of the next financial year.

Byrotrol said its balance sheet remains solid and debt-free and expects its cash position at year end to be no less than £1m without any new IP agreements. During the year it has absorbed more than £300,000 in restructuring and costs related to new hires.

It said underlying market trends are very favourable for long term growth.

Short term market conditions remain difficult, though, with too much supply still chasing too little consumption, especially in hand hygiene. This has been easing a little in the past three months as weaker competitors disappear and regulations bite harder, but it said the recovery is not smooth, and some suppliers are discounting very aggressively.

Byotrol said it has used the extra resources from additional COVID-related sales to completely change its organisation in readiness for the post-COVID world, with a full time CFO, three other new leadership hires, alongside continued heavy investment in technology.

The new team is focusing on a review of strategy for the new, post-COVID market conditions, that will result in:

• More resources put into products based on fewer technologies and sold into fewer market segments, but with greater emphasis on segmental marketing, sales and export markets
• Continued monetisation of the group’s technologies by way of IP agreements into non-core markets, including some non-core technology sales
• A more nuanced regulatory strategy, to account for increasing divergence between the UK and the EU post-Brexit. This was an unexpected development, but Byotrol believes the added complexity creates greater opportunity for the group
• Completing the pandemic-delayed integration of Medimark, and finally securing the significant revenue and cost synergies identified at the time of acquisition

Byotrol said: “The directors continue to believe that our IP-rich, technology-driven and regulatory-focused approach is the right one for success in the infection control industry. It builds trust with our direct customers, and with our corporate customers (that then in turn allows for IP agreements, which gets us into markets and products that we cannot access ourselves).

“Byotrol is now a financially solid, healthy business. We are now focusing our efforts on fewer technology platforms and our product sales in fewer market segments, with a new team that has the experience and expertise to deliver long term growth. We remain excited about the opportunities ahead.”