Herbicide deal ends investors' long wait

By LIAM DANN primary industries editor

Certified Organics boss David Warrick, with the kind of blunt honesty one doesn't always hear from chief executives, said shareholders had had about as bad a ride as they could have.

Warrick has little choice but to be upfront about the environmentally friendly agricultural pest control company's past.

Most of its shareholders have been part of an evolutionary process which has seen the company change its name and business direction and lose large sums of money over the past several years.

"We have about 5000 shareholders, of whom around 4000 came from the company's previous incarnation - Aquaria 21," Warrick said.

"So 80 per cent of our shareholders thought they'd invested in aquariums and unfortunately the managers or directors of that enterprise basically lost all their money."

Certified Organics moved into the shell of Aquaria 21 in 2001 and Warrick took over shortly after.

A British native, Warrick is a qualified chartered accountant. He has worked with Unilever and pest control giant Rentokil in a range of finance positions.

Certified Organics, little more than a start-up when it was first exposed to the rigours of the stock exchange, has had a tough few years.

But last month its long-suffering shareholders finally received some good news with the announcement that it had won a $250,000 initial order for its Interceptor Seed Eradicator organic herbicide from the South Australian state government.

The South Australians will use the initial purchase to field-test the Interceptor product - a pine extract - on what has been described as the world's most destructive weed, branched broomrape.

For a company of Certified's size that is a sizeable order. If it goes well it could lead to an ongoing deal and significant regular income.

Broomrape was a big problem in the horticultural areas of the United States and in Spain, Israel and other parts of the Middle East, Warrick said.

So South Australia could be a stepping stone. Results of the trial will be available this year.

Warrick believes the product is a "world-beater", citing interest from America, Europe and Japan.

The focus for Certified Organics is now on finding international partners to help get the product through local regulatory hoops and then provide distribution networks.

It has already found partners in Germany, Austria and Switzerland. The Swiss company has distribution rights for Spain, Portugal and Italy as well as Switzerland.

These partners were not all organic companies, Warrick said.

"Our German distributor is the largest distributor of glyphosates [the active chemical in traditional pesticides such as Roundup] in Europe.

"They have a problem in that glyphosates have been banned for use by every local council in Germany. So while they might see themselves as a traditional pesticide company they need a radical alternative or they won't get into those local authority markets."

Certified Organics has had to overcome the perception that it was a "greenie" company.

"We don't claim organics are going to totally replace everything that exists," said Warrick.

He aimed to develop sales in four key areas.

There was a home and garden market for people who did not want chemicals around their home.

There was the market for local authority maintenance (which was where the South Australian contract fitted in).

There was the organic grower, who remained a standard bearer for the company, Warrick said.

"That is a niche, but it's a niche in a huge world market."

Then finally, and perhaps most importantly, there were the increasing numbers of conventional growers who wanted to lower pesticide usage and were looking for products that compete on price.

"We are getting serious interest from growers who are struggling to comply with the likes of the European GAP regulations," he said.

"We're not saying organics is the only answer but it is a great answer. Interceptor has no residues so it is an effective tool in that armoury."

New Zealand had been a great testing ground.

Although Certified Organics has high hopes for Interceptor it does have other products in the pipeline.

Interceptor inventor Rod Innes is still on the board and retains an active role in new product development.

Most of the new products are based on the pine-extract technology he developed.

Certified Organics

Key products:

* Organic Interceptor - non-chemical weed killer.

* Spray and Go - organic moss, mould and lichen spray.

* Organic Enhancer - certified organic blossom-thinner.