Nanoco revenue jump driven by major US supply contract

Nano-materials developer Nanoco saw its shares dive on Wednesday despite forecasting a significant increase in revenue for the year ended 31 July.

In a trading update, the company, which manufactures and develops miniature semiconductors for flat-screen displays known as quantum dots, said it expects revenues of approximately £3.3m, up 154% from the same period last year.

The increase was driven by unaudited revenues of up to £2.5m arising from a February agreement with an undisclosed US- listed corporation, based on management's assessment that the project will be complete by 31 December.

The company also announced a further agreement with the same company in April.

Michael Edelman, chief executive of Nanoco, said: "The second half of 2018 has been transformational for Nanoco with the signing of the development and supply agreement with our large US-listed partner in our nano-materials division. We have made meaningful progress in display and lighting with first commercial products expected later this calendar year."

The company’s patented CFQD resin is being used in the production of gaming monitors which are on track to launch to the public for the 2018 end of year holiday season.

Elsewhere, Nanoco said its new manufacturing facilities in Runcorn are progressing as planned and that small-scale commercial shipments are expected to commence in second quarter and volume production in the second half of calendar 2019.

The company's unaudited cash position as at 31 July has increased by £5.0m to £10.7m over the same point last year.

Broker Peel Hunt reiterated its ‘buy’ rating for shares in the company , which stated that "the investment case remains intact" after the trading update.

Nanoco’s shares were down 10.64% at 42.00p at 1355 BST.