Iofina targets record iodine output as profits surge

Iofina PLC (AIM:IOF, OTC:IOFNF) expects to pump out record volumes of iodine this year, with a wave of new plants set to drive the AIM-listed producer towards its long-held expansion goal. The company, which extracts iodine from brine water and turns it into speciality chemicals, said it remained on track to meet full-year market forecasts. It expects to produce between 460 and 485 metric tonnes of crystalline iodine in the second half, building on a bumper first six months. The upbeat outlook came as Iofina reported a sharp jump in profitability for the half year to 30 June. Adjusted core earnings more than doubled to $6.6 million, while operating profit almost trebled to $4.9 million. Revenue rose 7% to a record $31.3 million, but the bigger story was margins, with gross profit up 62% as costs fell. Production did the heavy lifting, climbing 29% to 393.3 tonnes and beating the company's own raised target. Iodine prices, meanwhile, held firm at just under $75 a kilogram, giving that extra output somewhere profitable to go. The stronger trading fed straight through to the balance sheet, which swung to net cash of $7.2 million from a small net debt position a year earlier. Crucially, Iofina funded all $5.8 million of its first-half investment from its own cash flow, without dipping into loans. Much of that spending is going on new capacity. A plant known as IO#12, the first in the Permian Basin, is due to come online near the end of this quarter, adding up to 220 tonnes a year. Two further plants in central Oklahoma are contracted to start up by...