Shares in Nanoco Group PLC, the Cheshire-based Manchester University spin-out specialising in materials for infrared sensing applications, plummeted in early trading after the company announced the loss of a major European customer.
The news sent shockwaves through the market, with Nanoco's share price falling by 30% to 9.85 pence. The company attributed the customer's decision to its own strategic priorities, emphasising that it was not a reflection on the performance of Nanoco's materials.
Christopher Richards, non-executive chairman of Nanoco, acknowledged the disappointment of the situation, stating that it "reflects the nature of high technology supply chains for consumer electronics." He stressed that the customer's decision was not based on a lack of faith in Nanoco's technology, but rather on its own strategic goals.
Richards highlighted the company's strong financial position and its commitment to pursuing alternative opportunities. "Smaller scale opportunities are available for this technology in the short to medium term," he said, "and we aim to address those niche markets directly and in partnership with other companies."
Despite the setback, Nanoco remains confident in its future prospects. The company highlighted its ongoing collaboration with an Asian customer on a Joint Development Agreement for second-generation sensing materials, with potential production orders in the medium term. Additionally, Nanoco continues to engage in small-scale commercial ventures with other customers interested in display materials, along with ongoing new business development activities.
The loss of the European customer is expected to impact Nanoco's revenue for the 2025 financial year. The company anticipates revenues to be approximately 25% lower than consensus forecasts. Currently, Nanoco is negotiating end-of-project terms with the departing customer.
While the news of the customer loss has shaken investor confidence, Nanoco remains committed to its long-term vision. The company's focus on innovation and its strong financial position provide a foundation for future success, even in the face of this temporary setback.
