Accsys Technologies PLC – Preliminary Results

Accsys Technologies PLC – Preliminary Results

Doubling of capacity in manufacturing footprint on track to meet strong demand

Accsys, the chemical technology group, focused on the acetylation of wood, today announces preliminary results for the twelve months ended 31 March 2018.

Year to

31 March 2018

Year to

31 March 2017

Underlying

Statutory

Underlying

Statutory

Total Group Revenue

€60.9m

€60.9m

€56.5m

€56.5m

Gross profit

€13.6m

€13.6m

€14.4m

€14.4m

EBITDA

(€3.5)m

(€5.7)m

(€1.5m)

(€1.2m)

Loss before tax

(€8.8)m

(€10.4)m

(€4.5m)

(€4.5m)

Year-end cash balance

€39.7m

€41.2m

Year-end net (debt)/cash balance

(€3.8m)

€18.0m

Major capacity expansion and strategic progress:

  • Accoya® plant expansion completed and in operation from June 2018 to increase annual capacity by 50% to at least 60,000 cubic metres;
  • Strong demand continues for Accoya®, large proportion is repeat business, expected to generate significant increase in sales and margins;
  • Construction of transformational Tricoya® plant in Hull remains on track for completion mid-2019 calendar year, supported by strong sales of Tricoya® panels which have increased by 26% compared to last year reflecting increased demand; and
  • Hull plant, with capacity of 30,000 metric tonnes expected to become cash flow generative sooner, as a result of the new Tricoya® licence with FINSA.

Financial highlights:

  • Total revenue up by 8% against last year, with Accoya® revenue up 11%, offset by reduced licensing income;
  • Accoya® sales volumes up by 7% to 42,676 cubic metres, with a 15% increase in the second half;
  • Accoya® gross margin improved to 24% in the second half reflecting both price increases,  significant volumes sold to Medite and Rhodia at lower prices and no Accoya® licence income;
  • Underlying EBITDA improved to a €0.7m loss in the second half of year compared to €2.8m loss in first half;
  • 30% gross margin from the manufacturing of Accoya® continues to be achievable; and
  • Increase in net debt reflects significant investment in capacity increases for both Accoya® and Tricoya®.

Paul Clegg, Chief Executive commented:

"At the time of the justifiable increased awareness of the critical importance of alternatives to man-made and fossil based materials, this year has been a milestone year for Accsys.  Our patented technology and products have seen strong endorsement from both trade and financial partners. We have continued to see strong demand for both Accoya® and Tricoya®, driven by both their recognised technical performance and their sustainable provenance, which is becoming increasingly important for both end users and specifiers alike.

This has been a tremendous boost for our capacity expansion and has been integral to the major financial backing we received from a variety of stakeholders during the year. We have reported excellent progress on the significant increase in our manufacturing footprint in both Arnhem and Hull to more than double our capacity by mid-2019, with a 50% increase going live now. This capacity transformation will make a real difference to both margins and sales volumes, which have been constrained to date. We are achieving good results from developing sales to both existing and new customers in our established markets, as well as newer ones. Our partnership with FINSA, a pioneer in the field of sustainable and renewable wood-based solutions, is another important development for accelerating the commercial future of the new Tricoya® plant in Hull.

It's an exciting time for the whole team at Accsys and we are looking forward to the next phase of our development with confidence."

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