Although we don’t believe in timing the market or panicking over every stock fluctuation, understanding how a business is performing, competing and changing is vital to sensible investment.
What: The share price of Iofina (LSE: IOF) — a company that specialises in the production of iodine and iodine specialty chemical derivatives — has rocketed 27% in trading so far this morning, following publication of an update on the company’s September production and the preliminary grant of a water permit in the State of Montana.
So What: Iofina says that there was a month-to-month production increase of 18.6%, which rose to 28 metric tonnes (MT) of crystallised iodine. That means that Iofina achieved its forecast monthly production target for September.
The company also announced that its wholly-owned subsidiary, Atlantis Water Solutions, has now been preliminarily granted a water permit by the State of Montana’s Department of Natural Resources and Conservation.
The permit allows for diversion of water (which is expected to be used in Dawson, McCone, Richland, Roosevelt and Sheridan counties in Montana for the majority beneficial use by oil field services companies for oilfield development), development of a water diversion site, and construction of ten-bay fill station depot.
Now What: Having now met its monthly production target for September, the company reiterated its year-end forecast for the production of 325–350 MT of crystallized iodine.
Iofina says that the next stage of the water permit process is a brief “public notice” period and that unless there are any objections (which is says is unlikely), the preliminary permit will be granted until the Atlantis Water Depot is completed, followed by the granting of a final permit.
With regard to what it describes as the “non-core water project”, Iofina says that it will be looking for a joint venture partner, or specific project financing, exclusively within Atlantis Water Solutions, rather than funding it with Iofina’s current cash-on-hand.
President and CEO Dr. Tom Becker commented:
“Our iodine production from our IOsorb plants continues to improve. We remain focused on optimization of these plants and I am pleased with the results to date.”
“The preliminary granting of Iofina’s water permit in Montana is a great accomplishment for the Company and we look forward to updating the market with regards to the future plans of our water division, Atlantis Water Solutions.“
Even with today’s massive rise, Iofina’s share price remains 67% down on this time in 2013, since when the AIM All-Share has only dropped 5%. And Iofina’s share price trails its index over five years, too, recording a 30% fall, compared with a 17.5% gain by the AIM All-Share.
