16th Jun 2015 08:27
LONDON (Alliance News) - Accsys Technologies PLC Tuesday said it expects to be cash-flow positive over the year ahead, as it posted a narrowed pretax loss for its recently ended financial year.
Accsys is a chemical technology company focused on the acetylation of wood.
For the year to end-March the company posted a pretax loss of EUR7.7 million, narrowed slightly from a pretax loss of EUR8.2 million a year before, as a rise in revenue to EUR46.1 million from EUR33.5 million was offset by exceptional costs of EUR2.9 million related to its arbitration with Diamond Wood China Ltd.
Accsys terminated its license with Diamond Wood last year, alleging that Diamond Wood had failed to comply with contractual obligations. Accsys was ordered to pay damages and legal costs to Diamond Wood, and the arbitration tribunal ruled that the licence agreement between the two is to continue.
Accsys said that it has since recommenced its working relationship with Diamond Wood, and continues to believe that the China and South-East Asia region offers "substantial opportunities for Accoya in the long term".
Revenue growth was driven by a strong performance from its Accoya wood product. Sales volumes of Accoya wood rose 32% in the year, which Accsys said shows improvement in market acceptance of the product, and its ongoing investment in brand and marketing activities.
The company said it has seen positive trading in its current financial year against an improving market backdrop, which has resulted in further sales growth.
It intends to further improve its plant to match increasing demand, but said that ultimately it can only meet long-term demand by new manufacturing facilities, and it is "exploring all options in this respect."
"Our position now is stronger than at any point in our history and we continue to evolve our business model as we build towards becoming cash-flow positive in the year ahead and, longer term, achieving profitability," said Chief Executive Paul Clegg in a statement.
Shares in Accsys are trading down 10% at 67.00 pence Tuesday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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