It was a positive December quarter for ASX-listed CFOAM with the inorganic carbon material producer successfully delivering on its turnaround strategy from the previous quarter.
Shipments of its CFOAM and PFOAM products by volume increased significantly to existing and new clients. Actual shipments to customers were 1,119 units, more than double the sales volume of the previous quarter (546 units).
CFOAM production quality, which had impacted the business in the September quarter, appeared to have improved as evidenced by the growth in sales from its major customer Touchstone Advanced Composites (TAC) while quarterly sales to other customers achieved highest levels in the company’s history.
Sales achieved in Q4 2017, on an accrual basis, were 79% higher than those realised in Q3 2017.
We anticipate the ramp-up in shipments will continue over the coming quarters through an increase of sales to new and existing customers,”CFOAM executive director Alain F. Bouruet-Aubertot said.
Mr Bouruet-Aubertot said the implementation of the Phase 1 platform expansion program – which is now fully funded through non-dilutive State and bank provided financing – was proceeding as planned and expected to be ready to ship 25,000 cubic feet per annum of C-FOAM/P-FOAM product from August 2018.
“We continue to actively work on the operational and financing planning of our Phase 2 expansion program, with a formal decision to be made during Q3 2018,” he said.
Looking ahead, CFOAM expects cash flow generation will strongly increase in the next quarters, as a result of growing sales and revenue, more favourable/less “lumpy” timing in receivables, and the coverage of the Phase 1 capital outlays by loans disbursed by WVJIT and Summit.
The company also expects to have a significant ramp-up of CFOAM and PFOAM product sales starting in early-2018, including sales to both TAC and other existing/new customers.
The Company anticipates Q1 2018 shipments to rapidly reach, and exceed, previous record levels achieved during the first half of 2017, well before current nameplate capacity increases markedly post the start-up of the Phase 1 capital program in August.
CFOAM carbon foam is designed to meet growing demand for ultra-high performance engineering materials in the military, industrial, aerospace, and commercial product markets.
Shares in CFOAM closed Wednesday at 25.5c.
