BIOME TECHNOLOGIES PLC

Earnings Release • Jan 23, 2013

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RNS Number : 1409W

Biome Technologies PLC

23 January 2013

23 January 2013

Biome Technologies plc

("Biome" or "the Group")

Pre-close Trading Statement

Biome Technologies plc, the bioplastics and RF technology business, is pleased to provide a pre-close trading statement for the financial year ended 31 December 2012 ahead of the announcement of the audited Preliminary Results, which are scheduled to be published on 27 March 2013.

The Board reports that it expects the financial performance of Biome for the full year period to be in line with its expectations. As announced in the Group's most recent trading update, following the sale of its 50% share in Biotec Holding GmbH ("Biotec") in October 2012 for £5.2m, the Board is assessing various options to accelerate the development strategy of the Group and expects to provide a fuller update at the Preliminary Results.

Following the successful sale of Biotec, Biome is now able to focus on the commercialisation and development of its 100% owned intellectual property in the area of premium products. Biome began this work in 2008 and is now involved with a number of interesting customer opportunities with significant market potential. These include the pre-launch evaluation work with a leading manufacturer of high performance single-use foodservice products and the launch of multi-layer sealing film for single-use coffee capsules. The former project is progressing well and the latter was market tested in the fourth quarter of 2012 with a full launch now underway in January 2013 with some 40 tonnes delivered already. While the expected growth trajectories of both of these applications are potentially strong, their actual performance will be clearer by the second half of 2013.

Biome is also investigating opportunities for the manufacture of bio-based materials through the use of synthetic biology. This is an emerging technology and Biome has a small number of early stage collaborations with both academic and industrial partners.  The UK Government has identified the commercialisation of synthetic biology as an area of high priority where the UK can build a world leading position. The Board is exploring opportunities to accelerate the position of the business in this area in 2013 using mainly its intellectual, rather than its cash assets. To further this objective the business has an application for funding under consideration by the Technology Strategy Board (a Government body charged with making the UK a global leader in innovation) to support its research in this field.

The Stanelco RF Technologies team continues to explore opportunities to accelerate the expansion of the division and has a developing order book for the first half of 2013. This follows a slightly subdued end to 2012 as a number of optical fibre furnace deliveries were delayed due to some turbulence in the Chinese fibre market. Good progress continues on the Durapipe project and delivery timing for ten pre-production units is being finalised.  The business has recently been appointed as the UK sales and service agent for Forsstrom High Frequency AB ("Forsstrom"). Forsstrom is a world leading supplier of High Frequency welding equipment and this agreement extends Stanelco's product offering into larger welding equipment.

The Group continues to challenge all aspects of its cost base. The legacy long leases on buildings in Southampton remain a significant drag on the path towards profitability and the Board is exploring a number of strategies that might mitigate this outflow.

As outlined previously, the Board is giving consideration to returning funds from the sale of Biotec to shareholders that may be in excess of those required in the medium term. As this would require a re-organisation of capital, given the large accumulated losses and substantial share premium accounts, the Board is examining all the issues relevant to that and expects to update shareholders at the Preliminary results.

The Group's existing debt facility has remained unutilised for some time. Given current cash balances and working capital needs, this facility was terminated on 22 January and will result in modest future cost savings.  The Group's cash position at 31 December 2012 was up significantly to £6.3m (UK cash position 30 September 2012: £1.3m).

-Ends-

For further information please contact:

Biome Technologies plc                                            

Paul Mines, Chief Executive Officer

Declan Brown, Group Finance Director

www.biometechnologiesplc.com                                      Tel: +44 (0) 2380 867 100

Daniel Stewart & Company plc                                   

David Hart

www.danielstewart.co.uk                                                Tel: +44 (0) 20 7776 6550

First Columbus

Chris Crawford/Kelly Gardiner                 

www.first-columbus.com                                                 Tel: +44 (0) 20 3002 2070

FTI Consulting                                                

Oliver Winters/Latika Shah                                              Tel: +44 (0) 20 7831 3113

This information is provided by RNS

The company news service from the London Stock Exchange

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