Biome shares tumble as bioplastics hit by coffee pod

Bioplastics and RF technology outfit Biome Technologies saw full-year revenues soar 42% year-on-year but a drop in revenues from its bioplastics division led to a sell-off in shares early on Thursday.

Biome reported revenues of £8.8m in the year ended 31 December, but a 17% drop in bioplastics revenues to £1.9m was enough to weigh on sentiment.

The AIM-listed firm said the drop in revenues was a result of efforts to significantly lower sales of outer packaging for the US single-serve coffee market. Sales of its non-woven filter mesh for the US coffee pods have increased, together with other revenues, by more than 50%, compared to the prior year, however.

Biome stated that it was continuing to build a "more diverse and extensive portfolio" of bioplastics applications - with new and existing customers expected to "contribute substantially" to sales in "the latter part of 2019".

Looking forward, Biome said: "As 2019 unfolds, we expect a gradual but substantial increase in bioplastics revenues."

Elsewhere, Biome turned in a 75% year-on-year increase in revenues to £7m over at its RF technology unit thanks to a "very strong demand" in the fibre optic furnace market for Far Eastern markets.

But, despite the positive movement, Biome warned that its firm order book for the RF Technologies was lower than it had been a year earlier, with 2019 expected to be better than 2017 for this division but not as good as 2018.

Biome shares, having risen more than sixfold in the past two years, had tumbled up 23.53% to 520p on Thursday morning.