Plant Health Care plc – Digital Summary Report 2021
Overview
- Plant Health Care is a leading provider of biological products, helping farmers to feed the world sustainably.
- The market for biological products is growing at 12% per annum and is projected to be a $19 billion market by 2026.
- Plant Health Care’s core patented products act as “vaccines for plants”, making plants healthier, better able to resist disease and stress, thereby improving crop yield and quality.
- Sales of the Group’s Harpin product increased by 55% in 2021, as market shares grew in core markets; the Commercial business is profitable and cash generative.
- The Company has invested more than $25 million in PREtec, a powerful new platform technology, since 2012.
- PREtec products are targeting markets worth more than $5 billion around the world.
- The first PREtec product Saori™, was launched in Brazil in 2021, through our partner Nutrien, generating a very positive response from growers.
Commercial Products
Plant Health Care’s Commercial business is driven by sales of Harpin αß, a recombinant protein which acts as a powerful biostimulant, promoting the yield and quality of crops. The Group sells the proprietary soil treatment Myconate in selected countries. The Group sells Harpin αß and Myconate through specialist distributors around the world. In Mexico, the Group also distributes third-party biological products.
Products
| HARPIN αß |
New technology
Plant Health Care’s New Technology is focused on PREtec – plant response elicitors. These are peptides (short chains of amino acids) which stimulate plants to increase yield and resist disease. In September 2021, the Group successfully launched Saori™ in soybeans for Asian soybean rust control through our partner Nutrien.
Technology
| PREtec | ||
| INNATUS 3G | T-REX 3G | Y-MAX 3G |
Global reach
Farmers confront many challenges in providing food for a rapidly growing and more prosperous world. These challenges include reducing the use of potentially harmful agrochemical products. Biological products are becoming an increasingly important part of the solution because of the benefits they offer.
- Harpin αβ is sold as H2Copla into sugar cane in Brazil, through Coplacana, the largest distributor of inputs for this crop. Sales in Brazil sugarcane grew 100% under challenging drought conditions throughout 2021. In-market sales into the sugar cane market since 2019 have grown at 103% CAGR.
- The Group received registration for Harpin αβ in Argentina for use in corn and soybeans in August 2021 with first year sales planned for the 2022 cropping season.
- In September 2021, the Group successfully launched Saori™ in soybeans for Asian soybean rust control through our partner Nutrien.
NORTH AMERICA (CORN)
- Harpin αβ is sold into corn through the second largest distributor in the USA. Farmers apply Harpin αβ to the seed prior to planting; the crop comes up stronger and taller and better able to resist stress such as drought. Higher yields result. Sales of Harpin αβ increased 29%, reaching 841,000 acres in 2021. In-market sales into the Corn market since 2019 have grown at 55% Compound Annual Growth Rate (“CAGR”).
NORTH AMERICA (FRUITS AND VEGETABLES)
- Harpin αβ is also sold into the specialty market through our partner Wilbur-Ellis. Sales of Harpin αβ increased 142% to 157,000 ounces in 2021 due to increased sales into the California almond and grape markets. In-market sales into the fruits and vegetable markets since 2019 have grown at 116% CAGR.
- In Spain, Harpin αβ is sold as ProAct AA, where sales into fruit and vegetable crops have now reached $1.2 million.
- Sales growth in Spain was driven by Harpin αβ sales into citrus and expansion into the greenhouse market.
- In the UK, Harpin αβ is sold through Headland, a major distributor supplying to the professional turf market. Many leading golf courses and football fields are greener and more resilient to abiotic stress as a result.
- The Group signed an exclusive Harpin αβ distribution agreement with UK market leader Agrii in July 2021.
- Plant Health Care Mexico sells a range of sustainable products to farmers in Mexico. Harpin αβ represented 23% of sales in 2021, with third-party products making up the remainder. Plant Health Care Mexico employs a staff of 16, including sales and technical specialists in the field, selling to retailers throughout the country.
- Sales in Mexico were held back in 2021 due to decreased domestic demand for fruits and vegetables and reduced plantings in Baja California due to adverse weather conditions.
- Harpin αβ is sold as H2Copla into sugar cane in Brazil, through Coplacana, the largest distributor of inputs for this crop. Sales in Brazil sugarcane grew 100% under challenging drought conditions throughout 2021. In-market sales into the sugar cane market since 2019 have grown at 103% CAGR.
- The Group received registration for Harpin αβ in Argentina for use in corn and soybeans in August 2021 with first year sales planned for the 2022 cropping season.
- In September 2021, the Group successfully launched Saori™ in soybeans for Asian soybean rust control through our partner Nutrien.
NORTH AMERICA (CORN)
- Harpin αβ is sold into corn through the second largest distributor in the USA. Farmers apply Harpin αβ to the seed prior to planting; the crop comes up stronger and taller and better able to resist stress such as drought. Higher yields result. Sales of Harpin αβ increased 29%, reaching 841,000 acres in 2021. In-market sales into the Corn market since 2019 have grown at 55% Compound Annual Growth Rate (“CAGR”).
NORTH AMERICA (FRUITS AND VEGETABLES)
- Harpin αβ is also sold into the specialty market through our partner Wilbur-Ellis. Sales of Harpin αβ increased 142% to 157,000 ounces in 2021 due to increased sales into the California almond and grape markets. In-market sales into the fruits and vegetable markets since 2019 have grown at 116% CAGR.
- In Spain, Harpin αβ is sold as ProAct AA, where sales into fruit and vegetable crops have now reached $1.2 million.
- Sales growth in Spain was driven by Harpin αβ sales into citrus and expansion into the greenhouse market.
- In the UK, Harpin αβ is sold through Headland, a major distributor supplying to the professional turf market. Many leading golf courses and football fields are greener and more resilient to abiotic stress as a result.
- The Group signed an exclusive Harpin αβ distribution agreement with UK market leader Agrii in July 2021.
- Plant Health Care Mexico sells a range of sustainable products to farmers in Mexico. Harpin αβ represented 23% of sales in 2021, with third-party products making up the remainder. Plant Health Care Mexico employs a staff of 16, including sales and technical specialists in the field, selling to retailers throughout the country.
- Sales in Mexico were held back in 2021 due to decreased domestic demand for fruits and vegetables and reduced plantings in Baja California due to adverse weather conditions.
How we performed
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- Revenue was $8.4 million (2020: $6.6 million), a 28% increase on the prior year, 24% in constant currency*.
- Proprietary product revenue increased $2.2 million or 58% to $6.1 million (2020: $3.9 million).
- The Commercial business was EBITDA and cash positive for the second year straight.
- On-ground sales** in Brazil and the USA increased 48% and 85%, respectively.
* Constant currency is defined on page 10.
** On-ground sales is defined as sales by our distributors to growers.
- Successful launch of Saori™ in Brazil.
- PHC949 was submitted for registration in the USA.
- Low-cost manufacture of PREtec peptides was demonstrated at the pilot scale.
- The Group has a rich pipeline from the PREtec platform.
- PREtec is a patented platform technology, targeting $5 billion market opportunities. These ‘vaccines for plants’ use environmentally friendly peptides, derived from natural proteins, to make plants healthier and help growers produce larger yields and better quality crops.
- Cash used in operations increased to $3.2 million (2020: $2.5 million).
- Adjusted LBITDA*** increased to $4.6 million (2020: $3.3 million).
- Cash and cash equivalents including investments at 31 December 2021 were $9.2 million (2020: $4.1 million).
- The Company successfully raised £6.6 million ($9.1 million) through the issuance of new ordinary shares in March 2021.
*** Adjusted LBITDA: loss before interest, tax, depreciation, amortisation, share-based payments and intercompany foreign exchange
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- Revenue was $8.4 million (2020: $6.6 million), a 28% increase on the prior year, 24% in constant currency*.
- Proprietary product revenue increased $2.2 million or 58% to $6.1 million (2020: $3.9 million).
- The Commercial business was EBITDA and cash positive for the second year straight.
- On-ground sales** in Brazil and the USA increased 48% and 85%, respectively.
* Constant currency is defined on page 10.
** On-ground sales is defined as sales by our distributors to growers.
- Successful launch of Saori™ in Brazil.
- PHC949 was submitted for registration in the USA.
- Low-cost manufacture of PREtec peptides was demonstrated at the pilot scale.
- The Group has a rich pipeline from the PREtec platform.
- PREtec is a patented platform technology, targeting $5 billion market opportunities. These ‘vaccines for plants’ use environmentally friendly peptides, derived from natural proteins, to make plants healthier and help growers produce larger yields and better quality crops.
- Cash used in operations increased to $3.2 million (2020: $2.5 million).
- Adjusted LBITDA*** increased to $4.6 million (2020: $3.3 million).
- Cash and cash equivalents including investments at 31 December 2021 were $9.2 million (2020: $4.1 million).
- The Company successfully raised £6.6 million ($9.1 million) through the issuance of new ordinary shares in March 2021.
*** Adjusted LBITDA: loss before interest, tax, depreciation, amortisation, share-based payments and intercompany foreign exchange
2021 in review
2021 has been an excellent year of delivery against promise. The market for sustainable agriculture is growing at more than 12% per annum; Plant Health Care aims to grow faster than that market. Sustainability is at the heart of everything we do.
DR RICHARD WEBB
Non-executive Chairman
Plant Health Care’s encouraging performance in 2021 demonstrated the strength of our competitive position. In our sector of sustainable products for agriculture, we have a unique combination of proven products, with low costs of goods and very strong market access.
DR CHRISTOPHER RICHARDS
Chief Executive Officer
Revenues in 2021 increased by 28% to $8.4 million (2020: $6.6 million). On a constant currency basis revenue increased 24% or $1.6 million driven by strong growth in the sugar cane and the corn and specialty markets in Brazil and the USA, respectively.
Jeffrey Hovey
Chief Financial Officer