Shares in industrial pipemaker Tubi (ASX:2BE) shot up 313 per cent this morning on news it had been producing more pipes during COVID-19.
The company’s HDPE pipes service the oil, gas, irrigation, water, mining and infrastructure sectors in the US.
Tubi’s materials are designed to make pipes stronger and more cost-effective.
In the last quarter, the company achieved a production volume increase of 55 per cent.
This was off the back of an 85 per cent increase from April to May and another 51 per cent from May to June.
The company put this down to an increase in orders from clients. “Significant orders from key strategic clients are increasing in frequency, product diversity and volumes,” CEO Marcello Russo said.
Last November the company projected lower demand and consequently lower earnings, which prompted it to shelve its expansion plans.
But in the last quarter Tubi increased its industrial plant tally from one to three. It opened two plants in Florida in addition to its inaugural plant in Texas.
Falling into the category of an “essential service”, the plants did not have to close due to the pandemic.
Tubi now anticipates earnings will be better than it had earlier expected.
“I am looking forward to confirming (after the audit) the company returning to a monthly profit in the last quarter of FY20 and continuing monthly profitability throughout the first quarter of FY21,” Russo said.
Shares hit an intra-day high of 33c on Friday before edging back to 15c — still an 87.5 per cent increase.
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Barry Stroman was a reporter for Zerg Watch, before becoming the lead editor. Barry has previously worked for Wired, MacWorld, PCWorld, and VentureBeat covering countless stories concerning all things related to tech and science. Barry studied at NYU.