Xeros shares tumble as it slashes revenue, earnings expectations
Xeros Technology Group
0.72p
16:55 13/09/24
Textile industry environmental innovator Xeros Technology announced a delay in the mass market launch of a new nine-kilogram washing machine by its Indian licensee IFB Industries on Thursday.
FTSE AIM All-Share
745.23
17:09 13/09/24
Industrial Engineering
12,454.96
16:44 13/09/24
The AIM-traded firm said the launch, originally scheduled for 2024, was now expected in 2025 due to changes in machine specifications and recent leadership shifts within IFB's home appliances division.
It said the delay had led it to lower its revenue expectations for the 2024 and 2025 financial years to £0.5m and £3.8m, respectively.
Adjusted EBITDA losses were projected at £4.2m for 2024 and £1m for 2025, with the company forecasting cash reserves of £2.9m by the end of 2024.
Despite the setbacks, Xeros said it was optimistic about its medium-term prospects, as it actively pursued new licensing agreements with major global OEMs for its care and filtration technologies.
It also announced a significant milestone by securing a licensing agreement with Donlim Group, a leading manufacturer of electrical appliances.
Under the new agreement, Donlim would produce Xeros's XF3 external filter and XF1 internal filter, expanding its licensee network and leveraging Donlim’s extensive manufacturing capabilities.
The partnership would also involve joint marketing efforts and future product development, with mass production of the XF3 set to start in the second quarter of the 2025 financial year.
“We are delighted to announce this strategic partnership and contract with Donlim,” said chief executive officer Neil Austin.
“It forms a key part of our commercialisation plan and, whilst we are hugely excited by the wider possibilities for our collaboration, in the short-term we will focus solely on helping Donlim bring XF3 to market successfully.”
Austin said accessory sales of external microfibre-capture devices for domestic washing machines were forecast to be “significant” in Europe in the coming years, adding that XF3 was “the perfect plug and play solution” to meet such demand.
“Working with Donlim not only enables scaled production but allows us to work together to promote wider industry take up.”
At 1342 BST, shares in Xeros Technology Group were down 42.86% at 0.7p.
Reporting by Josh White for Sharecast.com.