REG - Accsys Technologies - Accsys Trading Update

Accsys TechnologiesAnnouncement

26/01/2023 07:00

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RNS Number : 8978N  Accsys Technologies PLC  26 January 2023

AIM: AXS

Euronext Amsterdam: AXS

 

26 January 2023

 

Accsys Technologies PLC

("Accsys", the "Group" or the "Company")

 

Trading update for the nine months ended 31 December 2022

Strong growth  in the third quarter to 31 December 2022 reflects demand for
our products, greater capacity at our Arnhem plant and pricing power for our
portfolio of sustainable wood building products.

 

Accsys, the fast-growing and eco-friendly company that combines chemistry and
technology to create high performance, sustainable wood building products,
today announces a trading update for the nine months ended 31 December 2022
('nine months'), on an unaudited basis.  Comparative percentage change
figures in this statement reflect comparisons with the corresponding nine
months in the prior financial year.

 

                          9 months to Dec 2022  9 months to Dec 2021  % change
 Total Group revenue      €109m                 €83m                  32%
 Accoya(®) wood revenue   €97m                  €72m                  35%
 Total sales m(3)         42,972                42,536                1%
 Net (debt)               (€52m)                (€61m)(1)

(1) Net debt as of 30 September 2022

Financial highlights

·      Strong  growth in Group revenue, up 32% to €109m, driven by
higher production at Arnhem facility (production levels from Reactors 1-3 at
capacity in Q3 and the new fourth reactor ('R4') ramping up) and further
increases in average sale prices

·      Accoya(®) sales volumes in Q3 (October to end December) were
19,015m(3) versus total H1 FY23 volumes of 23,957m(3) reflecting increased
capacity at Arnhem from Reactors 1-3 returning to full production following
the completion of R4 in September, new production from R4 and some unwinding
of higher inventory (work in progress) levels.

·      Customer demand for Accoya(®) remains resilient, with a visible
Q4 customer order book despite some slowdown in the broader construction
industry.  The higher average sales prices reflect price increases
implemented in H1, plus a further small increase in Q3.  In addition, we have
continued to successfully manage the effect of volatile chemical raw material
prices through the Energy Price Premium which increased in Q3, although this
is expected to reduce in Q4 as European energy market indices subside.

·      The combination of price increases and efficiency of operating at
higher production volumes has enabled further progression in the profit per
cubic metre of Accoya(®) sold in Q3.

·      Net debt of €52m, represents a reduction of €9m compared to
September 2022, reflecting the reduction in the NatWest loan balance resulting
from the Tricoya(®) restructure announced on 2 November.  Cash outflow
resulting from a reduction in payables from the Hull project as it moved into
the hold period in Q3 was partially offset by positive cash flow from the
Accoya(®) business.  While inventory balances remained higher than required
due to the long lead times of previous commitments and delivery timings around
holiday periods, these are expected to reduce by the year-end.

 

Continued good progress on strategic growth projects:

·      Accoya(®) (Arnhem) plant - R4 expansion commenced commercial
operation in September 2022 and performing well, with production now
successfully ramping up over forecast two years.

·      Accoya(®) USA JV - Construction of new 43,000m(3) plant
continues to progress well and remains on track to commence commercial
operation by March 2024.

·      Tricoya(®) (Hull) plant currently in an at least six-month hold
period from November 2022:

o  The Board continues to assess the economics and capability of the plant
and its potential returns on investment.

o  In parallel, the Board is also evaluating funding options, as outlined in
previous company announcements, which include discussions with potential
third-party partners and contractors.

o  Verification of the final cost and time to complete the plant is ongoing,
and while it is too early to give an exact figure, there are no indications
that this will exceed the up to €35m previously identified by the Company.

o  The Board of Accsys continues to see the market potential of Tricoya(®)
and will consider all relevant commercial factors in deciding whether or not
to proceed with the Hull plant and if so, on what basis.

 

Management update

The Company is making good progress on the recruitment for a new Chief
Executive and will issue an update in due course.  The process to appoint the
Chief Financial Officer is ongoing.  To ensure continuity of management while
that process concludes, the Board is pleased to announce that Will Rudge
(Finance Director) will stay on for a further short period of time to support
the Company.

 

Commenting on today's announcement, Rob Harris, Chief Executive of Accsys
Technologies, said:

"I am pleased with our performance over the last three months.  We have
delivered strong revenue growth in our Accoya® business due to enhanced
capacity from our Arnhem plant. Notwithstanding ongoing macro-economic
uncertainty, our expectations for customer orders continue to provide
confidence in demand and growth opportunities for both our market-leading
products, Accoya®  and Tricoya®. We remain on track for sales volumes in H2
to increase by 50% compared to H1 and, as a result, we continue to target our
previously stated ambition of nearly doubling underlying EBITDA for the full
year.''

Ends

For further information, please contact:

 Accsys Technologies PLC                 ir@accsysplc.com (mailto:ir@accsysplc.com)

Katharine Rycroft, Investor Relations
 Numis Securities (London)               +44 (0) 20 7260 1000
 Oliver Hardy (NOMAD), Ben Stoop
 Investec Bank plc (London)              +44 (0) 20 7597 5970
 Carlton Nelson, Alex Wright

                                       +31 20 344 2000
 ABN Amro (Amsterdam)
 Richard van Etten, Dennis van Helmond
 FTI Consulting (UK)                     +44 (0) 20 3727 1340

Matthew O'Keeffe, Alex Le May
 Off the Grid (The Netherlands)          +31 681 734 236

Frank Neervoort, Yvonne Derske

 

Notes to editors:

 

Accsys (Accsys Technologies PLC) is a fast-growing business with a purpose:
changing wood to change the world. The company combines chemistry, technology
and ingenuity to make Accoya(®) wood and Tricoya(®) wood elements:  high
performance wood products that are extremely durable and stable, opening new
opportunities for the built environment and giving the world a choice to build
sustainably. Accsys transforms fast-growing, certified sustainable wood into
building materials with an up to 50-year warranty, locking carbon stored in
the wood into useful products for decades, with performance characteristics
that match or better those of non-renewable, resource-depleting and polluting
alternatives.  Accsys is listed on the London Stock Exchange AIM market and
on Euronext Amsterdam, under the symbols 'AXS'.  Visit www.accsysplc.com
(http://www.accsysplc.com)

Accoya(®) solid wood is sustainable, durable, and stable with exceptional
performance, finish and sustainability. Accsys' proprietary acetylation
process makes the wood more dimensionally stable and because it is no longer
easily digestible, extremely durable. It is one of very few building materials
to be Cradle to Cradle Certified™ at the Gold level, with a Platinum rating
for Material Health, confirming that no harmful or toxic additives or
chemicals are present to leach out into the environment. Primary applications
for Accoya(®) wood include windows, doors, cladding and decking, where the
combination of performance and sustainability benefits compete favorably
against hardwoods, plastics, metals and concrete. Visit www.accoya.com
(http://www.accoya.com)

Tricoya(®) acetylated wood elements are produced for use in the fabrication
of panel products such as medium density fibreboard (MDF). Panel products made
with Tricoya(®) wood elements are truly durable and stable enough for use
outdoors and in wet environments, unlocking new possibilities for design and
construction. They have been lauded as the first major innovation in the wood
composites industry in more than 30 years and bring the flexibility of
traditional panel products and sustainability benefits of wood to a whole new
range of applications. Visit www.tricoya.com (http://www.tricoya.com)

Any references in this announcement to agreements with Accsys shall mean
agreements with either Accsys or its subsidiary entities unless otherwise
specified. 'Accsys' and 'Accsys Technologies' are trading names of Titan Wood
Limited ("TWL"), a wholly-owned subsidiary of Accsys Technologies PLC.
Accoya(®), Tricoya(®) and the Trimarque Device are registered trademarks
owned by TWL, and may not be used or reproduced without written permission
from TWL, or in the case of the Tricoya(®) registered brand trademark, from
Tricoya Technologies Limited, a subsidiary of TWL with exclusive rights to
exploit the Tricoya(®) brand.

 

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