World News

Plantic Technologies has extended its agreement with DuPont to market its plastic packaging made from renewable resources in Japan.

This follows the Australia-based firm's previous deal, signed last September, for DuPont to market its starch-based sheet materials in North America and injection-moulding resins globally, excluding Australia and New Zealand.

Plantic said Japan was a "key market" for biodegradable plastics and should provide a "strong platform" for growth.

The firm's share price rose by 4% to 51p following the announcement this morning (29 April).

Plantic also reported a loss of A$10.26m (£4.8m) on sales of A$1.5m in its full-year results to 31 December 2007.

However, chairman Ian Wightwick said the firm had made "significant progress" in several "key areas", which would form the basis for long-term growth.

He said the amount of packaging material sold increased by 22% to 299,000kg in 2007, but the decision to concentrate on sheet material rather than trays had reduced the average selling price and led to flat revenue compared with the previous year.

In addition, the first agreement with DuPont took longer than expected to finalise and a series of compliance tests had to be conducted, leading to a delay in Plantic receiving revenues from injection-moulding resins.

"Plantic's financial position remains strong, with a year-end cash position of A$38m," said Wightwick.

The firm spent A$3.6m on research and development in 2007, compared with A$2.1m in 2006.

Product development agreements were signed with National Starch to provide Plantic with high-amylose cornstarch, the raw material for its materials, and with US packaging company Bemis to develop flexible packaging films and to supply products for sale into the US market.

UK customers for Plantic's products include Marks & Spencer and Sainsbury's.

Plantic launched HP1, a new high-performance biodegradable packaging sheet, at this week's Interpack in Düsseldorf.