Antimicrobial and textile odour control materials developer HeiQ (LON: HEIQ) says trading conditions have worsened because of weak consumer spending. The share price has more than halved to 26p.
The market deteriorated late in 2022. There are also high levels of inventory in the market, which has hit reorder levels. HeiQ also points out that customers are hesitant to invest in product innovation. Management does not believe it has lost customers, but the revenues are delayed.
Cenkos has reduced its forecast revenues for 2022 and 2023. This means that HeiQ will make a loss in 2022. In 2023, forecast net income has been slashed from $4.25m to $115,000. Cash of $7.19m is forecast for the end of 2023.
HeiQ is acquiring Tarn-Pure for £850,000 in cash and shares. Tarn-Pure has IP relating to regulatory registrations to sell elemental copper and elemental silver for use in disinfecting hygiene applications, where HeiQ already has sales. Tarn-Pure has annual revenues of $400,000 generated from royalty income.
Prior to Christmas, HeiQ increased its stake in probiotics ingredients business HeiQ Chrisal from 51% to 71%. The additional shareholding cost €2.9m in shares at 75.1p each.