Next Investors logo grey

Alexium a growth story unfolding as fiscal 2021 approaches


Published 30-APR-2020 11:06 A.M.


3 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.

Click Here to View Latest Articles

Alexium International Group Ltd (ASX:AJX) released its March quarter result on Thursday which included a promising business update for the three month period.

Of course, this comes only days after the company signed a Supply and Evaluation Agreement with a major flame retardant chemical company as a strategic business partner for the market launch of Alexiflam® NF.

This along with a supply agreement signed with Soft-Tex International, Inc., has seen the company make a stellar start to the June quarter.

However, harking back to the March quarter, it is important to note that the group came into the new calendar year well poised with a strong management team and a revitalised capital structure to drive the commercialisation of its flame retardant and thermal management products.

These same strengths also prepared the company for the unprecedented impact of COVID-19 on the global economy.

Management emphasised that it has been focused on maintaining operations while looking after the health and safety of its employees, and this will continue to be the focus until the pandemic subsides.

In discussing the recent developments against the COVID-19 backdrop, Alexium chief executive Bob Brookins said, “Despite these challenges, significant progress has been made this quarter.

‘’Two key milestones have been satisfied with the signing of an exclusive supply agreement with Soft-Tex and the supply/evaluation agreement for the commercialisation of Alexiflam® NF.

‘’Both partners will be an important contributor to Alexium’s success, and the team looks forward to working with them.

‘’The company’s liquidity remains strong after the successful $22.3 million capital raise which was completed in January 2020.

‘’This positions Alexium well to manage the near future of the COVID-19 pandemic as we continue to grow the company.”

Alexium’s resilience has been reflected in the group’s share price over the last five weeks or so with it more than doubling from 2.8 cents to 6.3 cents, just shy of its three month high.

Soft-Tex agreement represents a major milestone

Casting an eye to the future and bearing in mind that the new fiscal year is now only two months away, it is worth examining the significance of the Soft-Tex agreement.

In mid-April, Alexium announced the signing of a supply agreement with Soft-Tex International, Inc., to exclusively purchase Alexicool® products for bedding systems based on Soft-Tex’s Reactex® technology for top-of-bed and mattress applications.

00 - AJX

Terms of exclusivity apply to both current and future PCM-based products from Soft-Tex International.

The agreement has an initial two-year term and may be automatically renewed.

The agreement specifies the provisions for the commercial relationship, including pricing, supply capabilities, and Alexium’s analytical support for Soft-Tex commercial efforts.

It is important to understand that this transaction was far more than a one-off supply agreement as it established a key strategic partner for Alexium, cemented its position in an established supply chain, and represented a key milestone for the first two growth pillars management had flagged at the half-year mark.

Consequently, Alexium continues to be a news-driven story with the potential for significant share price upside.

General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.