(Alliance News) - Itaconix PLC on Tuesday warned sales and adjusted earnings would be below management's previous expectations after it failed to agree terms with an existing customer.

Shares in Itaconix, the London-based maker of sustainable plant-based polymer consumer products, slumped 18% to 215.00 pence in London on Tuesday.

In a statement, Itaconix said revenue and adjusted earnings before interest, tax, depreciation and amortisation for 2024 and 2025 are expected to be below management's previous expectations, although gross profit margin will improve.

In 2024, Itaconix predicted revenue in the range of USD6.0 million to USD6.5 million.

In 2023, the company expects to report revenue of USD7.9 million, up 41% USD5.6 million in 2022.

Itaconix said it had been unable to reach "satisfactory commercial terms" with one of its major existing customers in North America for supply in 2024.

This was due to a strategic decision to decline low-margin business and focus on diversifying the revenue base for its performance ingredients.

Whilst talks on 2024 pricing and volumes are continuing, and some order volumes remain likely, the impact is likely to be much lower volumes and revenue from this customer in 2024 compared to 2023, the firm said.

Itaconix said it remains "highly optimistic" about the company's future and commercial progress.

"The company is securing new detergent customers in Europe and North America and expanding the use of its performance ingredients into new user bases. These efforts are focused on building a more diverse, profitable, and sustainable revenue base to achieve Itaconix's goal of being a large and profitable specialty ingredient company," it commented.

By Jeremy Cutler, Alliance News reporter

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