07 May 2014
AIM: AXS
NYSE Euronext Amsterdam: AXS
7 May 2014
ACCSYS TECHNOLOGIES PLC
("Accsys" or the "Company")
Trading Update
Accsys, the environmental science and technology company whose primary focus is on the production and technology licensing of Accoya(R) wood and Tricoya(R) wood elements, today issues a trading update for the full financial year ended 31 March 2014 (based on unaudited figures). Key highlights include:
-- Strong performance with total revenue increasing by 78% to EUR33.5m (2013: 25% growth to EUR18.8m);
-- Cash balance increased to EUR15.2m (December 2013: EUR14.4m) due to a combination of revenue growth, licence income and improvements in working capital;
-- Continuing growth in Accoya(R) wood revenue of 77% to EUR29.3m (2013: 22% growth to EUR16.6m). Excluding sales to Medite, Accoya(R) revenue increased by 61% to EUR26.4m (2013: 45% growth to EUR16.4m);
-- Total Accoya(R) volume sold increased by 88% to 25,391m(3) (2013: 9% growth to 13,471m(3) );
-- Arnhem plant profitability continues to improve, recording a positive EBITDA in the year;
-- The decision concerning Solvay's plant and its location is expected in the next few months;
-- Total of 59 Accoya(R) distributor and agency agreements now in place, an increase from 42 in 2013 and 35 in 2012; and
-- Tricoya Technologies Limited ('TTL'), our JV with INEOS, continues to make progress:
o Significant work carried out in developing the Process Design Package for Medite;
o Strong increase in demand for Medite Tricoya;
o Medite Tricoya project has been awarded Life+ subsidy from the EC, worth up to EUR2.1m.
Financial results (unaudited)
Total revenue for the year ended 31 March 2014 increased by 78% to EUR33.5m (2013: EUR18.8m). In the same period, excluding sales to Medite for the manufacture of Tricoya, Accoya(R) revenue increased by 61% to EUR26.4m (2013: EUR16.4m). Sales to Medite increased significantly compared to the previous year, during which Medite had been utilising their earlier initial build-up of stock. Total revenue also included EUR1.1m of licence income (2013: EUR0.6m).
Net cash balance as at 31 March 2014 of EUR15.2m represents an increase of EUR0.8m since 31 December 2013. The increase is due to the receipt of licence income and the positive effects of changes in our working capital, which included the utilisation of inventory which had been built up in advance of expected higher sales in the final quarter of the year. Cash outflow from operating activities before changes in working capital decreased significantly in the year ended 31 March 2014 compared to the prior year and this trend is expected to continue.
The overall loss for the year has reduced as expected, due to the higher revenue and resultant improvement in profitability. However, other operating costs have also increased, in part due to legal costs associated with the on-going Diamond Wood arbitration.
Accoya sales and production
Revenue from Accoya(R) customers increased by 61% in the year to 31 March 2014 compared to last year reflecting continuing strong growth in demand in all regions. Growth has been driven by both existing and new customers and, while the improving economic climate has helped, the growth continues to be driven by the ever increasing awareness of Accoya(R) in the global market place and its acceptance as the world's leading, high-technology, long-life wood.
We implemented Accoya(R) price increases in all regions during the last quarter of the year ended 31 March 2014. While the price increase was in part attributable to increasing raw material costs, taken together with increased sales volumes, we expect profitability to continue to improve in the new financial year.
We now have a total of 59 Accoya(R) distributor and agency agreements in place (an increase of two since February) covering most of Europe, Australia, Canada, Chile, China, India, Israel, Mexico, Morocco, New Zealand, South Africa, parts of South-East Asia and the USA.
Production of Accoya(R) from our Arnhem plant has increased significantly in order to meet customer demand. The significant ramp up in output has been achieved without significant investment in capital expenditure and the resulting improvements to our productivity have also contributed to our profitability.
We continue to invest in research and development focussing on productivity, capacity, new species and product development in order to meet our customer demands.
Licensing