The Calix Ltd (ASX: CXL) share price is deep in a sea of red on Friday, plunging 18% to an intraday low of $4.30 near the open.
Shares in the environmental technology company have clawed back some ground and are currently swapping hands at $4.62, still 15.7% lower than the company's closing price of $5.48 yesterday.
Calix has plunged alongside the materials sector, which is currently the worst-performing sector in the ASX by a substantial margin.
The S&P/ASX 200 Materials Index (ASX: XMJ) is down 3.37%, while the S&P/ASX 200 Index (ASX: XJO) is now fielding a 0.47% loss. The All Ordinaries (ASX: XAO) is down with a 0.58% loss.
It shouldn't be surprising then that Calix is not the only materials share that's taking a beating. Sector peers such as Bellevue Gold Ltd (ASX: BGL) and Jervois Global Ltd (ASX: JRV) are down 3.25% and 4.42% respectively.
But why is the Calix share price falling further than its peers on Friday? One likely explanation is that it made a negative announcement to the market this morning. Let's cover what happened.
Image source: Getty Images
Government withdraws carbon capture technology program
Calix has been informed that the Federal Government will not proceed with its previously announced carbon capture, use and storage (CCUS) hubs and technologies program.
The initiative was first revealed as part of the Federal budget on 25 October, and Calix was due to receive $11 million in funding, which has now been cancelled.
The funds were earmarked for a joint project between Calix and Adbri Ltd (ASX: ABC) to develop low-emissions lime.
However, the Government is due to open a new carbon capture technologies program in 2023, and will reportedly allocate $141.1 million in grants over ten years to projects that support this effort.
Calix said it was waiting on more details from the government about this program while also pursuing alternative forms of government funding at regional and state levels.
What did management say?
Responding to the news, Calix managing director and CEO Phil Hodgson said:
Calix acknowledges our partners for their commitment to achieving carbon neutral cement and lime. We are also grateful for the Australian Government's support of carbon capture and storage technologies for cement and lime, which is an essential technology to mitigate the unavoidable production of CO2 during the cement and lime manufacturing process.
Hodgson continued:
We believe the Leilac technology can also play an important role in urgently decarbonising this essential and hard-to-abate sector of the Australian economy. We look forward to continuing to work with Australian governments and industry to help achieve Australia's emissions reduction targets.
Calix share price snapshot
The Calix share price is down 33.46% year to date. In comparison, the S&P/ASX 200 Index has lost 8.64% over the same period.
The company's market capitalisation is around $1.02 billion.
