Disappointing share price no measure of future success, says CropLogic boss
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Agtech CropLogic says it’s confident it has planted the seeds of success, despite lagging investor confidence.
The Kiwi stock debuted on the ASX in September, after raising $8 million at an issue price of 20c — but closed at 8.7c on Friday, down 56.5 per cent.
It has been a rocky start for the company, still yet to reach its issue price on the open market.
Managing director Jamie Cairns put the lower share price down to the exit of early investors.
“The company started in 2010 with angel investment so I think it would be logical that those might have sold out by this stage,” Mr Cairns told Stockhead.
“Operationally, everything that we have achieved so far is exactly what we said we would do.”
That’s a reference to the successful 2017 potato growing season in Washington, where CropLogic generated revenue of more than $2 million in service income of approximately 100 probes.
With their crop production technology, sensors monitor the water, soil, plant, pest and weeds from their mobile app and decrease the necessity for agronomists to make site visits.
They say the tech has the potential to improve the bottom line for potato producers by as much as 90 per cent.
That’s certainly been the case for their 60,000 acres of crops under management and a land size Mr Cairns hopes will only increase.
“Acquisition will be a large part of our strategy,” he told Stockhead.
“Our approach is two-fold, we can acquire businesses and make them more profitable, when we can start optimising the decision-making process we end up with a potential yield increase.”
While the US has been the key initial market, the latest executive appointment of former NAB banker David Thorn is hoped to spur movements into Asia, leveraging their proximity from across the Tasman.
“While agritech in Asia is still a developing field, CropLogic is looking to expand its sphere of influence with new Asian partners and companies to tackle global agricultural problems,” they told the market at his appointment.
“As a New Zealand company, CropLogic is interested in partnerships that can provide solutions on feeding cities that can’t currently rely on existing agricultural systems.”