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TyraTech may miss second half targets but voices confidence about 2016

Last updated: 02:50 24 Sep 2015 EDT, First published: 10:55 24 Sep 2015 EDT

TyraTech hails strong first half but second half trading may miss targets
Vamousse was the fastest-growing branded head lice product in the US

--- Updates with comment from chief executive, share price ---

Life sciences group TyraTech (LON:TYR) blamed distribution issues for lower-than-expected second-half trading, but said it was confident about 2016.

After a strong first half in which sales rose 267%, they continued to rise since June 30, but had been behind the firm's forecast expectations.

The group, which develops natural insect and parasite control products, said second-half results would be lower than expected if the trend continued - but materially better than the first half.

TyraTech said its Vamousse lice treatment & protective shampoo, which drove the increase, was the fastest-growing branded head lice product in the US and was extremely well positioned.

It now has new products in more than 8,000 stores in chains such as Wal-Mart and CVS in the US.

But it said it continued to be in uncharted territory from a forecasting perspective, not having experienced, as yet, a full year with current distribution arrangements in place.

Chief executive Bruno Jactel said it had taken a while to get the products "on the shelf".

"We suffered from that at the beginning of the year and lost a few months of sales, but we're well prepared for next year," Jactel told Proactive Investors in an interview.

"I think we're very well positioned to have fast growth in the year coming up."

Shares in Tyratech fell 0.62p to 4.88p in afternoon trading in London.

TyraTech said it was poised to develop and launch alternatives to pesticides in a number of other target markets.

Since the end of the first half, TyraTech has launched Vamousse Treatment and Shampoo in Ireland, introduced Vamousse shampoo in Boots and secured a distribution deal with Well pharmacies, previously known as the Co-op. It also wants to expand in other European markets.

It added: "There is good evidence the market for head lice products is growing year-on-year and we believe we're well positioned with our product range and the quality of our customer base to benefit from this growth.

"In addition, we believe there will be additional contributions next year from the animal health and equine products."

Gross profit increased by about 150% to $2mln from the effect of new product commercialisation.

Loss from operations reduced to $1.7mln for the first half of 2015 from $2.6mln a year ago, resulting primarily from increased product sales.

The net loss before and after taxes decreased to $1.5mln from $3.1mln last time.

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