Accoya’s acetylated wood producer’s shares climb 40%

Thursday 17 Apr 2014

When Paul Clegg was drafted into Accsys Technologies five years ago to turn the loss-making business around, it was haemorrhaging cash and struggling to convince global construction companies and timber groups to pay a premium for its modified wood products.

Accsys, a spin-out of Queen Mary University of London, invented a method for turning cheap soft wood into a durable construction material to rival expensive hard wood. Accsys's acetylated wood, branded Accoya, is now being used on everything from doors and decking to electricity pylons, coy carp ponds in China and entire buildings in the monsoon regions of India.

The firm listed on Aim in 2005 raising €27m (£22.5m) to build a demonstrator plant. In 2007, a further listing on Euronext gave Accsys a market capitalisation of €600m. The plan in those early days was to license the technology around the world. However, the business model was flawed. The demonstrator plant was used primarily as a research and development centre, which placed a huge drain on the balance sheet. The business was restructured.

Rather than cold-calling prospective licensees, Mr Clegg turned Accsys into the global shop window for acetylated wood, finding customers in new markets and shipping wood all over the world. "We seeded these markets," he says. "We focused on windows, doors, decking and cladding - 150m cubic metres of wood are used for these applications each year."

Today, Accsys has distribution agreements spanning 45 countries. Once customers began working with Accoya, the licence requests started flowing in. In its interim management statement for the six months to December 2013, sales were up 60% to £18m year-on-year.

The company has benefited from increasing environmental awareness and tougher building regulations, requiring carbon and energy neutral specifications. While other modified and engineered woods are available, no other companies have successfully commercialised Accsys's proprietary acetylation process.

Mr Clegg is keen to prove to investors that Accsys will generate significant returns. After a tough few years, he believes that the company is on a sound footing. In the past six months, the share price has increased by almost 40 %.

As part of this year's Wood Innovations 2014 event covering wood preservation, wood modification and wood composites, Accsys Technologies Director of Business Development, Eddie Pratt (founder of Accsys Technologies (then called Titan Wood) and the first CEO of Accsys Technologies PLC) from the UK will be speaking to local companies on the technology and growth of the company.

Details of the event running in mid-September in both New Zealand and Australia can be found on the event website,

Source: Sunday Telegraph

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