Accsys announces closure of Tricoya plant in Hull

19th Sep 2024 11:45

(Sharecast News) - Accsys Technologies, a provider of sustainable wood building materials, announced its decision to discontinue operations at the Tricoya plant in Hull on Thursday.

The AIM-traded firm said the move came after a strategic review by the board, which concluded that closing the plant was in the best interests of the company and its shareholders.

It said the decision to halt production at the Hull facility, owned by its wholly-owned subsidiary Tricoya UK, came after it explored various strategic and funding options for the plant.

The board's review was conducted in response to ongoing challenges and uncertainties surrounding the project's viability.

It said the discontinuation would result in a final non-cash impairment charge of about €20m, and a cash cost of around €4.5m, which would be reflected in its financial results for the first half of the 2025 financial year.

Despite the closure, Accsys said it would continue to produce materials for its Tricoya product range at its existing production site in Arnhem, the Netherlands.

The company retained the intellectual property rights for Tricoya and intended to meet growing demand for the materials through its established production facilities.

"Whilst this is a difficult decision, the board is confident that this is the right course of action for the company and its shareholders," said chief executive officer Dr Jelena Arsic van Os.

"Discontinuing the Hull plant further derisks and simplifies our business and enables us to fully focus on maximising returns from our existing assets.

"Today's actions, alongside our expansion in Arnhem and newly opened Kingsport facility, underpin our confidence in delivering profitable growth as we progress towards our target of 100,000 cubic metres of production by the end of the 2027 financial year."

At 1201 BST, shares in Accsys Technologies were down 2.07% at 52p.

Reporting by Josh White for Sharecast.com.