Accsys Technologies (AXS)

Sector:

Manufacturing

Index:

FTSE AIM All-Share

49.80p
   
  • Change Today:
      0.050p
  • 52 Week High: 69.80p
  • 52 Week Low: 48.40p
  • Currency: UK Pounds
  • Shares Issued: 240.41m
  • Volume: 53,585
  • Market Cap: £119.72m
  • RiskGrade: 210
  • Beta: 0.01

Accsys revenue rises, but profit margins narrow

By Josh White

Date: Tuesday 21 Nov 2023

LONDON (ShareCast) - (Sharecast News) - Wood products specialist Accsys Technologies reported a 21% increase in first-half revenue on Tuesday to €71.2m.
The AIM-traded firm put the growth down to strong product demand, higher average sales prices, and expanded production capacity following the launch of reactor four in September last year.

Accoya, one of its flagship products, saw a 20% increase in sales volumes, totalling 28,807 cubic metres.

The growth was particularly pronounced in the rest of the world and the rest of Europe markets, with increases of 42% and 28%, respectively.

Accoya for Tricoya production also saw 30% growth to 8,393 square metres, reaffirming Accsys' confidence in the Tricoya market potential.

However, Accsys did report a two percentage point decline in its gross profit margin, to 29%, due to higher raw material costs and inventory optimisation for wood.

Moreover, the company faced a significant challenge with a 64% decrease in underlying EBITDA to €1.6m.

The board blamed the drop on increased pre-operational costs at the Accoya plant in Kingsport, US, slated for completion in mid-2024, as well as heightened operating expenditure in sales and marketing, executive recruitment, and engineering.

Accsys said it was actively pursuing strategic growth projects, including the successful performance of its Arnhem plant, ongoing efficiency improvements, and the construction of the new 43,000-metre Accoya plant in Kingsport, which was progressing as planned for completion and commercial operation in mid-2024.

However, the firm said it was reevaluating its Tricoya UK plant project due to the current operating environment and its focus on the Accoya plant in Kingsport.

The Tricoya UK plant's viability, strategic interest, and financial capabilities will be reviewed early next year.

Accsys also reported an exceptional item of €1.2m related to organisational realignment and cost-saving initiatives, aiming to deliver annual cost savings of €3m or more.

Additionally, a non-cash impairment loss of €7m was recognised for the Tricoya segment, primarily due to changes in discount rates and market interest rates.

As of 03 September, Accsys had a net debt of €48.2m, representing a €4.1m increase since the end of the 2023 financial year.

That was attributed to capital spending of €2m, changes in working capital, inventory positions, and scheduled loan interest payments, partially offset by EBITDA generation.

In response to a challenging macroeconomic trading environment, Accsys announced a fundraising initiative to raise gross new proceeds of €24m and extend its debt facilities.

The funds would be used to complete the Accoya plant in Kingsport by mid-2024, strengthen its balance sheet, and provide additional working capital.

Accsys said it was taking decisive actions to secure the funds to support its growth strategy.

"In navigating the challenging macroeconomic conditions of the first half of the year, our new management team has shown unwavering commitment in reshaping Accsys towards a less complex business model with increased execution focus," said chief executive officer Dr Jelena Arsic Van Os.

"As we reflect on our business performance, we acknowledge and proactively address short-term obstacles.

"However, our confidence in our innovative product range remains unshaken, with the conviction that our Accoya and Tricoya premium offerings set us apart in the market, representing substantial untapped potential.

"To ensure delivery on this potential, the company has raised today approximately €24m of new proceeds from our shareholders to improve near-term liquidity and enable us to finalise the construction of our Accoya plant in Kingsport, US, which alongside our wider operations, strengthens Accsys's position for growth in both the medium and longer term."

At 1101 GMT, shares in Accsys Technologies were down 4.68% at 60.05p.

Reporting by Josh White for Sharecast.com.

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

AXS Market Data

Currency UK Pounds
Share Price 49.80p
Change Today 0.050p
% Change 0.10 %
52 Week High 69.80p
52 Week Low 48.40p
Volume 53,585
Shares Issued 240.41m
Market Cap £119.72m
Beta 0.01
RiskGrade 210

AXS Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
23.53% below the market average23.53% below the market average23.53% below the market average23.53% below the market average23.53% below the market average
16.67% below the sector average16.67% below the sector average16.67% below the sector average16.67% below the sector average16.67% below the sector average
Price Trend
58.09% below the market average58.09% below the market average58.09% below the market average58.09% below the market average58.09% below the market average
69.23% below the sector average69.23% below the sector average69.23% below the sector average69.23% below the sector average69.23% below the sector average
Income Not Available
Growth
30.75% above the market average30.75% above the market average30.75% above the market average30.75% above the market average30.75% above the market average
84.62% above the sector average84.62% above the sector average84.62% above the sector average84.62% above the sector average84.62% above the sector average

What The Brokers Say

Strong Buy 1
Buy 0
Neutral 1
Sell 0
Strong Sell 0
Total 2
buy
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AXS Dividends

No dividends found

Trades for 03-Oct-2024

Time Volume / Share Price
15:55 10,000 @ 49.20p
15:55 10,000 @ 49.40p
15:54 11,964 @ 49.45p
13:10 5,000 @ 49.20p
13:10 500 @ 49.20p

AXS Key Personnel

CEO Jelena Arsic van Os
CFO Sameet Vohra

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