CHANGING WOOD TO
CHANGE THE WORLD
Annual Report and
Financial Statements 2023
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
01
WHAT’S
INSIDE
HOW WE ENHANCE
NATURE
Our acetylation
process
06
OUR BUSINESS MODEL
26
OUR STRATEGY
28
Overview
02 Key Highlights
OUR GLOBAL
TECHNOLOGY
CENTRE
10
Corporate Governance
74 Board of Directors
04 Our Business at a Glance
76 Senior Leadership Team
06 Case Study – How We Enhance Nature
78 Chair’s Statement of Governance
08 Case Study – Accoya Color
80 Corporate Governance
82 The QCA Corporate Governance
Code (the ‘QCA Code’) Statement
of Compliance 2023
88 Audit Committee Report
90 Nomination Committee Report
92 Health, Safety and Environment (‘HSE’)
Committee Report
93 Remuneration Report
108 Directors’ Report
112
Statement of Directors’ Responsibilities
10 Case Study – Our Global
Technology Centre
12 Reasons to Invest
14
Executive Chair’s Statement
Strategic Report
20 Our Products
22 Our Market
26 Our Business Model
28 Our Strategy
34 Business Review
44 Finance Review
50 Risk Management
56 Sustainability
67 Stakeholder Engagement
ACCOYA COLOR
08
BUSINESS REVIEW
34
Accsys is a fast-growing business with a purpose:
CHANGING WOOD TO
CHANGE THE WORLD
We combine technology and ingenuity to enhance the properties of wood to create products
that are extremely durable and stable, presenting new opportunities for the built environment.
FY23 has been a year of significant progress and change
We have also made good progress on the construction
for the Accsys business. It has also been a year that has
of our plant in Tennessee. However, the project has
produced some well documented challenges.
experienced some delays and cost inflation and, as a
The underlying health of the business has never been
stronger. We delivered our highest volume production
result, commercial operations are now expected to
commence in mid-2024.
ever in FY23 post the installation and start-up of reactor
Construction of the world’s first Tricoya plant in the
4, and the global demand for both Accoya and Tricoya
UK has been more challenging, with the project in a
continues to grow.
Post the year end, and with a new management team
in place, including the appointment of Dr. Jelena Arsic
van Os as CEO Designate and Steven Salo as Group
hold period while we assess its capabilities and funding
options. Our new management team is well positioned
to decide how to move forward in the best way for
the business.
CFO, the business is now well placed to capitalise on this
The future growth opportunity for Accsys is clear and
customer demand and execute against our ambitious
we are focused on delivering against our strategic
SUSTAINABILITY
capital projects.
growth plans.
56
Financial Statements
116
Independent Auditors’ Report to the
members of Accsys Technologies PLC
125 Consolidated Statement
of Comprehensive Income
126 Consolidated Statement
of Financial Position
127 Consolidated Statement
of Changes in Equity
128 Consolidated Statement
of Cash Flow
129 Notes to the Financial Statements
166 Company Statement
of Financial Position
167 Company Statement
of Changes in Equity
168 Notes to the Company Financial
Statements
Shareholder Information
175 Shareholder Information
We have made significant progress in growing production
capacity through the completion of a fourth reactor
at our plant in Arnhem, enabling us to produce record
volumes of Accoya in Q4.
34%
GROWTH IN REVENUE
AT €162.0m
6%
GROWTH IN ACCOYA
SALES VOLUMES AT
63,344m3
120%
GROWTH IN UNDERLYING
EBITDA1 AT €22.9m
FY23 has been a year of significant progress
and change for the Accsys business. It has
also been a year that has produced some
well-documented challenges.”
Stephen Odell
Executive Chair
View the latest results online at | www.accsysplc.com
Cover: Accoya cladding, windows and doors and shutters. Architect: Good Architecture. Builder: Winchester Construction Co., Inc.
Window & Door Manufacturer: Dover Windows & Doors. Landscape Architect: Lila Fendrick. Photography: Erik Kvalsvik. Interior Designer: Mona Hajj Interiors
For more information, please see the Executive Chair’s Statement | Page 14
1. On an underlying basis, including the Group’s attributable share of our USA joint venture
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS 02
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
03
Key Highlights
Financial highlights
2023
€162.0m
2023
€55.2m
2022
€120.9m
2022 €36.0m
2023
2022
€22.9m
€10.4m
GROUP REVENUE
GROSS PROFIT
UNDERLYING EBITDA1
€162.0m
€55.2m
€22.9m
+34%
2023
2022
GROSS PROFIT
MARGIN
34%
+53%
+120%
34%
2023
€11.0m
2023
€(44.1)m
30%
2022 €1.3m
2022 €(27.2)m
UNDERLYING PROFIT
BEFORE TAX
NET DEBT
€11.0m
€(44.1)m
1. On an underlying basis, including the Group’s attributable share of our USA joint venture
Operational and ESG highlights
ACCOYA
SALES VOLUME
63,344
CUBIC METRES
ACCOYA
SALES GROWTH
+6%
ACCOYA
SALES GROWTH H2 ON H1
+64%
See our Business Review | Page 34
HEALTH AND SAFETY
0.9
LOST-TIME INCIDENT
RATE
INCREASED RENEWABLE
ELECTRICITY USAGE AS
A PROPORTION OF TOTAL
ELECTRICITY TO
CERTIFIED SUSTAINABLE
(I.E. FSC® (CO12330)
WOOD SOURCES
63%
OF THE OVERALL MIX,
INCLUDING RECS
(2022: 39%)
100%
(2022: 100%)
More financial highlights | Page 44
For our Alternative Performance Measures details | Page 136
See our ESG highlights | Page 56
Project: Villa Harmony, Ibiza,
Balearic Islands, Spain
Distributor: Grupo Gámiz
Architect: Paco Candel
Carpentry: Carpintería Gil Almansa
For more Accoya projects go online at |
www.accoya.com/uk/projects
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
04
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
05
Our Business at a Glance
Our purpose
CHANGING WOOD TO
CHANGE THE WORLD
‘Changing wood’ is what we do, and ‘to
change the world’ is why we do it. Our
purpose gives us a common, aspirational
goal to work towards and is embraced
by our stakeholders: making the world
a better, more sustainable place.
Who we are
We combine technology and ingenuity to enhance the properties of wood to create products
that are durable and stable, presenting new opportunities for the built environment.
Our values
Our values represent what we believe in as a company. We use them to guide our strategy and actions
for the long term and on a daily basis. Our values are:
1Be ambitious – the world
depends on us
2Respect and value all
stakeholders
3Be committed to safety,
quality and sustainability
Our ambition is to change the world
– it doesn’t get much bigger than
that. We must be bold, agile and
committed to our goals. We have
to be ‘all in’ and move quickly and
decisively. To achieve our ambitions
we may make mistakes, but we must
not be afraid to try. We will always
learn from the experience.
Everyone we work with is important
– our colleagues, customers,
partners, suppliers, shareholders
and more. We act with integrity
and authenticity, encourage
collaboration, and build trust
through inclusion and mutual
respect. As a team, we will succeed.
Safety is of the utmost importance
in everything we do. We all share
responsibility for protecting people,
property and the environment at all
times. We strive to fulfil our brand
promise and delight our customers.
We commit to delivering consistently
high quality.
Our products
Accoya is the world’s leading high performance
sustainable wood. Manufactured from abundantly
available, FSC® certified wood species, it is sustainable,
durable, resistant to rot and Cradle to Cradle Certified®.
Tricoya wood chips are a feedstock for our licensees to
manufacture high performance Tricoya panel products
suitable for outdoor use.
Our sustainable business model
Through our sustainable business model we give the world a choice
to build sustainability and create value for all our stakeholders.
Our
activities
Responsible
sourcing
Proprietary
manufacturing
Global sales and
distribution
Working with
business partners
Research and
development (R&D)
Building new plants
and optimising
existing sites
Investing
in our
future
Read more |
Page 26
Our footprint
Kingsport Accoya site
Dallas sales office
Key
Accsys Locations
Product Distribution
Under Construction
Hull Tricoya site
Barry Accoya Color site
London Accsys head office
Arnhem Accoya site & office
Freiburg Accsys sales office
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS 06
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Case Study | INNOVATION IN ACTION
07
HOW WE
ENHANCE NATURE
As Accoya and Tricoya grow as global brands, the
outstanding qualities of our ultra-high performance and
sustainable wood products is becoming more widely
recognised by customers, manufacturers and distributors.
Our expertise in innovation has enabled us to transform fast-
growing softwood into some of the most durable, stable and
low maintenance wood products in the world.
Accoya and Tricoya undergo a process called acetylation
Reactor in Arnhem plant
through which the structure of natural wood is permanently
33%
ADDITIONAL CAPACITY
IN ARNHEM IN FY23
Find out more online | www.accsysplc.com/
products/what-is-acetylation/
Our proprietary
acetylation process
modified, giving it the same durable properties as more
carbon-intensive man-made materials.
The chemistry utilised in the acetylation process involves
changing the molecular structure of wood cell walls. Free
hydroxyls within these cell walls are responsible for the
absorption and retention of moisture, causing swelling and
eventual decay of the wood. Acetylation solves this problem
by replacing these free hydroxyls with stable acetyl groups
(already present in the wood), thereby reducing its ability to
retain moisture and making it dimensionally stable and durable.
Thorough real-world testing has been conducted over many
years on Accoya, which means we can confidently provide
industry-leading warranties of up to 50 years. Successfully
commercialising this technology allows Accoya and Tricoya
to become ideal wood products for a number of applications
including joinery (windows and doors), cladding and decking.
Innovation in technology allows us to truly enhance what nature
gives us so that we can change wood, to change the world.
Scan here for more on
our acetylation process
Lourens Van As, Project Engineer in Arnhem
Where other companies have tried and failed
over the years to commercialise what is often
described by those working in the industry
as a ‘wonder wood’, we have perfected the
process, which is protected with extensive
intellectual property including c.388 patents
and patent applications in 45 countries.”
Pablo Steenwinkel
Group Head of Technology
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
08
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Case Study | INNOVATION IN ACTION
ACCOYA
COLOR
Accoya Color is our latest innovation and despite
being available in only a few select markets, it is
already proving to be a great success.
Accoya Color is made initially in the same way as
regular Accoya wood but then undergoes a secondary
manufacturing process during which it is coloured,
surface to core, with a rich, grey tone. Colouring
the wood in this way gives the product a premium
Decking made out of Accoya Color
and durable aesthetic for commercial applications,
including decks and cladding projects.
Accoya Color has all the same advantages as Accoya
but with the additional benefit of being richly
coloured, removing the requirement of having to
manually stain or coat end users’ wooden decking
or cladding and also the associated time and cost
that comes with annual maintenance to keep the
product looking fresh and uniform, year after year.
Our technology means that Accoya Color remains
consistently grey, even if scratched, pierced or cut
through. It is also certified non-toxic and is barefoot
friendly in even the warmest climates.
In addition to the product’s existing markets of
Germany, Switzerland, Austria and North America,
Accoya Color was launched this year into the new
markets of Australia, New Zealand and France.
140%
INCREASE IN VOLUME
PRODUCTION OF ACCOYA
COLOR IN FY23
Find out more online | www.accoya.com/
products/decking/color-grey-decking
Accoya Color pool decking
with LED lighting, Austria
09
PRODUCT DETAILS
Project: Color decking for pool surround, Switzerland
Distributor: Holzagentur Schweiz
Supplier: SPA Sperrholz-Platten AG
Manufacturer: Brunner Zimmerei Holzbau GmbH
In 2022 Accoya Color was awarded Cradle to
Cradle® certification at the prestigious ‘Gold’
level, as well as being awarded ‘Platinum’ level
(the highest level) for both ‘Material Health’
and ‘Water Stewardship’. This certification
demonstrates that Accoya Color is a product
that adheres to very high standards of
sustainability, alongside the recognised high
performance and durability credentials of
the brand.”
George Neel
Managing Director, Accoya Color
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
10 | Accsys Technologies PLC | Annual Report and Financial Statements 2023
11
Case Study | INNOVATION IN ACTION
OUR GLOBAL
TECHNOLOGY
CENTRE
Our Global Technology Centre in Arnhem
Innovation is at the heart of what we do at Accsys
and this has enabled us to become a leading modified
wood manufacturer on the global stage. Situated
next to our manufacturing facilities in Arnhem, our
Global Technology Centre (GTC), led by Dr Pablo
Steenwinkel, is focused on many innovation projects.
The team is focused on both process and product
innovation which impact the short, medium and long-
term future of the business.
Process optimisation is of paramount importance
because of the growing global demand for our
products. A small reduction in the batch cycle time –
or a small volume-optimisation step in the production
process – can produce meaningful gains in annual
volume production, and with production capacity
recently expanded in Arnhem, process optimisation
and reliability remain core areas of focus for the
GTC team.
There is a large addressable market for our existing
product brands and we work closely with our Sales &
Marketing teams to understand evolving consumer
needs and to assess where innovation can meet
those needs.
Some of our most exciting innovation work is being
carried out with ‘system partners’ – businesses
that manufacture products that are often used
in conjunction with Accoya and Tricoya (such as
adhesives, coatings and hardware).
The GTC is core to the Accsys business, contributing
The new wood stacking process machinery at
the Arnhem plant
to our performance today and developing the
products and partnerships of the future.
Tamsin Stevens, ESG Manager,
visiting our Global Technology Centre
It’s fantastic when our system partners see
the value in the performance credentials
of our brands and collaborate with us to
create high performance product systems
to overcome technical obstacles.”
John Alexander
Group Sales Director
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS 12
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Reasons to Invest
WE BELIEVE THAT ACCSYS
TECHNOLOGIES REPRESENTS
A COMPELLING GROWTH
OPPORTUNITY FOR INVESTORS
13
Accoya cladding, Vilnius, Lithuania – Architect
Architekturos linija. Sub distributor Argilla
3
Scalable growth
SCALABLE
Our manufacturing process and modular industrial design is based upon
confidential technical know-how and protected IP which can be expanded and
replicated world-wide.
As demonstrated by our successful plant in
Our Accoya USA plant in Kingsport, Tennessee
Arnhem, the Netherlands, the Accsys know-
has been designed in anticipation of adding
how and intellectual property allows us to add
additional reactors to the site as demand for
additional capacity to existing sites.
the product grows.
Accoya Color Grey cladding - private residence in Scarborough
Hill, Christchurch New Zealand. Distributor ITI Timspec
See Our Strategy | Page 28
1
Substantial market
opportunity
2
Sustainability
There is a growing need and
regulatory push to move from
non-renewable to renewable
lower carbon construction
materials.
LOW
ENVIRONMENTAL
IMPACT
SUSTAINABLY
SOURCED
The properties of our products -
sustainability, strength, durability and
beauty - perform strongly against the
highest performing non-sustainable
and man-made materials. With the
building sector accounting for c.38%
of global CO2 emissions, renewable
lower-carbon construction materials
such as wood are gaining in popularity
in the global construction industry.
This presents a significant addressable
market for our products.
Our products meet the growing
demand for environmentally
friendly alternatives seen in
everyday life and in every
sector of manufacturing.
Our products are grown from
renewable sources, sequester carbon
and lock it in to a useful, recyclable
and non-toxic building material.
They enable creative and innovative
design and construction, while fitting
into a sustainable circular economy
bio-cycle, reducing embodied
carbon costs, and without risking
environmental contamination through
the leaching of chemicals or pollution.
4
World leaders in
wood technology
5
We have developed innovative,
proprietary and protected
technologies which chemically
modify wood through an
acetylation process.
WORLDWIDE
ACCREDITATIONS
ORGANISED
The resulting products benefit from
exceptional dimensional stability,
durability and many other qualities.
Our products are best-in-class
and are leading the revolution
of modified woods in a growing
building industry which is starting to
recognise and adopt the significant
long-term benefits of such materials.
Strong organisational
capability
Talented people are at the
core of Accsys, with skilled
employees at all levels and
committed and experienced
leadership. This means Accsys
has the ability to capitalise
on and develop on growth
opportunities.
Our Board and Senior
Leadership Team are highly
committed and experienced, with
varied backgrounds including from
the broad industrials, chemical,
manufacturing, consumer goods,
marketing and finance industries.
See Our Market | Page 22
See our Sustainability section | Page 56
See Our Products | Page 20
Our Board and Senior Leadership Team | Page 74
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
14
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Executive Chair’s Statement
15
A PROFITABLE
YEAR WITH
GOOD
FUTURE
PROSPECTS
Overview
Despite particularly challenging macro-economic
conditions, which include the ongoing war in
Ukraine, an energy crisis, rising inflation, supply
chain disruption and the pressing need to address
climate change, Accsys has made significant
progress in the 2023 financial year as we move
forward with our ambitious plans for growth. The
resilience of our business against this difficult
backdrop is testament to the attractiveness of our
products, the strength of our business model and
the talent and commitment of our people.
Despite delivery of strong
growth in revenue and EBITDA
in FY23, the year has not been
without its challenges.”
Stephen Odell
Executive Chair
€162.0m
Overview of performance
2023
2022
€120.9m
GROUP REVENUE
€162.0m
+34%
€22.9m
2023
2022
€10.4m
UNDERLYING EBITDA
€22.9m
+120%
The successful construction and completion
of a fourth reactor in our plant in Arnhem, the
Netherlands, together with reactors 1-3 returning
to production after the temporary shutdown of
the plant in April and May during the completion of
the R4 capacity expansion, led to our highest ever
volume production in Q4. Demand for our Accoya
and Tricoya wood has been strong as customers
continue to seek products that deliver outstanding
performance, durability and sustainability.
The year has not been without its challenges,
however. In November, we announced that, while
we had taken 100% control of the world-first
Tricoya project in Hull, we also put the project into
a hold period of at least six months to assess future
capability and funding options. While further work
is required to prove the working capabilities of the
plant, we have made good progress on this review
over the past six months.
We have also been assessing the cost to complete the
Group gross margin increased by 4 percentage points
project, developing extensive and detailed work packages
to 34%, aided by the higher average sales prices
in order to do so.
This work stream has confirmed our original assessment
outlined above. Underlying profit before tax increased
by €9.7m to €11.0m. Statutory loss before tax was €67.1m.
of the costs to complete the project as up to €35m.
Net debt increased by €16.9m in the year to €44.1m
Over the period we have also continued to sell Accoya to
our off-take partners, MEDITE and FINSA, both of which
convert Accoya wood into Tricoya and help seed the
market. We continue to see good levels of market demand
for the product, which reaffirms our view of the long-
term market potential for Tricoya. Ongoing discussions
due to the planned investment into Accoya USA, (€29m),
capex investments of €29.8m into the Arnhem reactor
4 and Tricoya Hull projects (partially offset by a placing
in May 2022 which raised net proceeds of approximately
€19.0m), the reduction in the NatWest loan (€9.4m) and
EBITDA generation during the year.
with both partners about future arrangements following
Our purpose, values and strategy
completion of the plant remain positive.
Our purpose at Accsys is to ‘Change Wood to Change
We have also been in discussions with certain strategic
the World’. Ambition, respect for our stakeholders and
partners with a view to providing appropriate funding
our commitment to safety, quality and sustainability
necessary to complete the Hull plant’s construction.
are the Company’s three core values. We have bold
To date, the Company has been unable to reach
ambitions for growth: we successfully enhanced our
acceptable terms with any of these strategic partners.
production capacity in Arnhem this year with reactor
In view of the strong market dynamics underpinning
Tricoya, the Board of Accsys continues to believe in the
underlying attractive economics and margins associated
with completing the construction of Hull and therefore
will continue to explore funding options to support the
plant’s construction, including strategic partners and
lending institutions. Absent the availability of third-party
funding, the Company will use modest levels of internally
generated cash to maintain the plant and progress certain
4 and remain fully committed to further expanding our
global production capability. Safety is of the utmost
importance to Accsys and all our colleagues have a
collective responsibility to protect people, property and
the environment. We continue to strive to fulfil our brand
promise and delight our customers with consistently high-
quality products. Sustainability and our impact on society
are core to what we do – not just for our products, but
also for how we operate as a company.
pre-construction works. The Board will continue to
Our strategy for growth is predicated on four priorities.
engage with stakeholders in respect of Hull and its future
They are:
prospects. Despite its belief in the future potential for
Tricoya, the Board is clear that the base Accsys business
must not be compromised to find a solution for Hull. In
the meantime, we will continue to work with our partners
to develop the Tricoya market using Accoya, including
1.
Grow product demand – developing market
opportunities to drive revenue growth;
2.
Practice manufacturing excellence – growing our
global manufacturing production capacity and doing
exploring the expansion of dedicated capacity for greater
things faster, better, and more safely;
volume production within our existing facilities.
We have made good progress with our Accoya USA JV
with Eastman. However, construction has experienced
some delays and cost inflation. Both Accsys and Eastman
remain fully committed to delivering the project, which will
replicate the proven technology of our successful plant
in Arnhem.
2023 financial performance
3.
Develop our technology – product R&D and process-
related technologies and IP to protect and grow our
leading market position; and
4.
Build organisational capability – developing our
people and organisational capability to enable us to
meet our growth objectives.
We provide an in-depth review of our progress against
these four priorities for growth in our Strategic Review
Accsys delivered revenues of €162.0m, a 34% increase
on pages 28 to 33.
on FY22, reflecting continuing strong demand for
our products, higher average sale prices and the
implementation of an Energy Price Premium to mitigate
higher gas prices. Underlying EBITDA was €22.9m, an
increase of 120% on the prior year, and ahead of our market
guidance of nearly doubling last year’s EBITDA of €10.4m.
OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS 16
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Executive Chair’s Statement continued
Award-winning and sustainable wood products
Our Board
During the year, Accoya’s high level of performance and
The Board’s composition brings depth and a range of
sustainability was recognised in various prestigious global
experience to Accsys, both supporting and challenging the
industry awards. Accolades include the EmiratesGBC
Executive team in the execution of the Company’s strategy.
‘Green Building Product of the year’ and the ‘Best of
Post the year end, there has been some considerable
Products’ award from The Architect’s Newspaper, USA for
change with the departure of Rob Harris and William
Accoya Color Grey. We continue to see strong customer
Rudge from the Board, together with the appointment of
support for our products, such as Google, where Accoya
Dr Jelena Arsic van Os as Chief Executive Office Designate
has been specified on its new HQ ‘landscraper’ building in
and Steven Salo as Chief Financial Officer. We also
King’s Cross, London.
Health & Safety
During the year, the Company rolled out a number of
dedicated safety learning programmes and initiatives,
including a Health & Safety month in February 2023
announced in May 2023 that Sean Christie, Sue Farr and
Alexander Wessels are to step down from the Company
as Non-Executive Directors at the forthcoming AGM in
September. Please see my Statement of Governance letter
on page 78 for further details on these changes.
which gave our colleagues the opportunity to participate
Our people and stakeholders
in group discussions on safety improvement, training
I would like to express my sincere appreciation to our
sessions and guest speaker events. Health & Safety
colleagues across the Company for their continued
continues to be a top priority for the Board and for Accsys,
dedication, loyalty and hard work. I would also like to
and the Board-level HSE Committee established in 2022
express my thanks to our shareholders, customers,
has helped support the Board’s focus on this key area.
business partners, suppliers, and contractors for their
ESG
Accsys is committed to growing and operating its
business in a responsible and sustainable way. Aligned
with our values and business strategy, our ESG framework
outlines 10 key material issues and impact areas on which
we are primarily focused.
Having completed Stage One of our 2020 sustainability
strategy roadmap, we are now in Stage Two and are focused
on establishing specific development plans, including
setting Science Based Targets (SBTs) to reduce our
emissions intensity per cubic metre of Accoya produced.
Building on our commitment to transparency, Accsys
participated for a second consecutive year in the S&P
Global Corporate Sustainability Assessment. Accsys
scored 43/100 - an improvement of five points (13%) on
the prior year, placing the Company in the top quintile
in the ‘Paper & Forest Products’ industry category.
Capital raise
continued support of Accsys Technologies.
Looking ahead
We expect to leverage the benefits from greater
economies of scale associated with higher
production volumes at our plants. FY24 will also be
a year of transition, during which we will implement
actions to ensure the future sustainable growth
of the business and to drive value creation for our
shareholders. These actions include moving towards
completion of the Kingsport plant, which will incur
higher costs this year as we invest in people and
infrastructure in readiness for start-up and making
key investments in the core business to support
higher volume production. In view of our increased
capacity at Arnhem and future capacity from
Kingsport, and in light of some softening of price
and demand in the global construction industry,
we are dedicating more resource to sales and
marketing, particularly in the US, to prepare for a
In May 2022, the Company completed a €19m net capital
greater level of supply as this project comes online.
raise from shareholders to support the completion of
current capital projects and increase working capital
and cash flow headroom. We extend our thanks to
shareholders for their continuing support and investment
in Accsys.
We have made a good start to FY24. With our new
executive management team in place to drive the
business forward, we are confident in delivering
further financial and operational progress in the
coming year, and in the longer-term demand and
growth opportunity for Accoya and Tricoya.
Stephen Odell
Executive Chair
26 June 2023
CASE STUDY
BARNSNAP
HOUSE PROJECT
West Sussex, United Kingdom
Located in West Sussex, Barnsnap House is a modern
five-bedroom property that was recently built on
a woodland clearing site. To keep in tune with the
natural surroundings of the previous woodland, timber
cladding was used for the exterior façade of the
family home.
The timber chosen was Accoya, which is made from
acetylated wood. Accoya has exceptional dimensional
stability, evident from its 50-year above-ground
warranty, and many other qualities, as well as being
sustainably sourced.
It was crucial for the client that the Accoya had a rustic
finish with a coating that was easy to maintain and
a colour that was between black and brown. James
E. Hatch & Son supplied sawn-face Accoya cladding
and produced an in house bespoke colour using a
coating system from Anker Stuy Coatings to match
the client’s requests.
The client was able to select from three rustic timber
finishes, each with slightly different shades and
appearances.
PRODUCT DETAILS
Supplier: James E. Hatch & Son
Coatings: Anker Stuy
For more Accoya projects go online to | www.accoya.com/uk/projects
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OVERVIEWGOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
18 | Accsys Technologies PLC | Annual Report and Financial Statements 2023
1919
STRATEGIC
REPORT
Strategic Report
20 Our Products
22 Our Market
26 Our Business Model
28 Our Strategy
34 Business Review
44 Finance Review
50 Risk Management
56 Sustainability
67 Stakeholder Engagement
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 20
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Products
ACCSYS PRODUCES
TWO PRODUCTS
Accoya is our acetylated solid wood product brand.
Tricoya wood chips are the principal ingredient used by
It is the world’s leading high performance sustainable
our licensees to manufacture Tricoya panel products
wood brand, sourced from fast growing, FSC® certified
(similar to MDF) with enhanced properties: exceptional
forests. It is both highly stable and resistant to rot, with
durability, very high dimensional stability and ideal for
properties that match or exceed those of the most
use in wet environments internally or externally. These
durable tropical hardwoods, plastics and other non-
properties open countless opportunities for specifiers,
renewable alternatives. Ideal for use across numerous
architects, joinery manufacturers and product designers.
internal and external applications, Accoya’s primary
applications are windows, doors, decking and cladding.
Find out more online |
www.accoya.com/uk/project/accoya-tricoya-natural-pool/
Accoya comparison chart
a
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✓ ✓ ✓ ✓ ( ✓) ✓ ( ✓) ✓ ( ✓)
✓ ✓
d
o
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w
d
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R
✓
✓ ✓ ✓
N/A
N/A
N/A
N/A
N/A
Lifespan
Warranty
Coatings performance
✓ ✓ ✓ ✓ ✓✓
Thermally insulated
✓ ✓
✓
Maintenance intervals
✓ ✓ ✓
✓ ✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓ ✓
✓
The number of X’s (1-3) are an indicative scale with one X being the
worst and 3 X’s being the best.
Find out more online | www.accoya.com
21
Our products are defined by three sets of credentials: performance, finish, and sustainability. It is with this
combination of product attributes that we seek to delight our customers and stand apart from the competition.
PERFORMANCE
FINISH
SUSTAINABILITY
Accoya and Tricoya redefine
Accoya and Tricoya products look
Both wood product brands compete
performance when it comes to
better for longer. Accoya affords
not only with other wood products,
timber. Both product brands
the option of being left uncoated
such as tropical hardwoods, but also
are highly durable with industry-
to weather naturally or opting for a
other carbon intensive materials
leading warranties of up to 50
coated finish. Due to the excellent
such as aluminium, steel, concrete
years above ground and 25 years
dimensional stability of both Accoya
and plastic. The durability of our
in ground or freshwater. Offering
and Tricoya, coatings last longer,
products means that we are well
outstanding dimensional stability in
with many coatings manufacturers
placed to substitute these less
their composition, both products
offering extended coating warranties
sustainable materials, as well as
are suited to extreme climates
on their products. Maintenance time
offering the additional sustainability
as well as offering high levels of
is reduced, saving time and money
benefits that building from wood
insect resistance.
over the long term. Versatility of
affords. All sourced wood that is used
products means design freedom
to manufacture both Accoya and
not normally achievable with other
Tricoya is FSC® certified. Our Accoya
wood products.
product brand is also certified by
Cradle to Cradle® at the Gold level.
WARRANTY FOR
REDUCTION OF OVER
CERTIFICATION
50years
ABOVE GROUND AND
25 YEARS IN GROUND
OR FRESHWATER
75%
IN SWELLING CAUSED
BY MOISTURE UPTAKE
DEMONSTRATING
LEADING SUSTAINABILITY
CREDENTIALS
25 & 50 YEAR
50 YEAR
WARRANTY
WARRANTIES
HIGHLY
HIGHLY
STABLE
STABLE
HIGHLY
HIGHLY
DURABLE
DURABLE
LONG
LONG
SERVICE LIFE
SERVICE LIFE
NATURAL
WOOD
LOW
LOW
MAINTENANCE
MAINTENANCE
MULTIPLE
FINISHES
MULTIPLE
FINISHES
LOW
LOW ENVIRON-
ENVIRONMENTAL
MENTAL IMPACT
IMPACT
SUSTAINABLY
SUSTAINABLY
SOURCED
SOURCED
100% RECYCLABLE
100%
RECYCLABLE
INSECT
INSECT
RESISTANT
RESISTANT
FOR ALL
FOR ALL
CLIMATES
CLIMATES
FEWER
FEWER CALL
CALL BACKS
BACKS
BESPOKE
BESPOKE
OPTIONS
OPTIONS
IDEAL FOR
COATING
WIDE BOARDS
WIDE BOARDS
AVAILABLE
AVAILABLE
NON TOXIC
NON TOXIC
WORLDWIDE
ACCREDITATIONS
WORLDWIDE
ACCREDITATION
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 22
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Market
A SIGNIFICANT
GROWTH OPPORTUNITY
Overview
Accsys’ products are positioned
within the global wood products
market, which is estimated to
be worth $748bn in 2023 with
a compound annual growth
rate (CAGR) of 7.4% (Source:
The Business Research Company).
Macro-economic trends, wider
societal ‘megatrends’ and market
penetration opportunities provide
us with significant growth and
demand drivers.
With demand for our products
exceeding our volume of supply,
increasing our production capacity,
as we have done in our plant in
Arnhem this year, is central to
sales growth.
The global wood products industry
• They compete with the high
produces approximately 800m cubic
value end of the outdoor wood
metres per annum (Source: The UN
market, which represents around
Food & Agriculture Organization).
25% of the global outdoor wood
As our products compete with
market; and
and displace other non-wood
building materials from concrete
to plastics, the market opportunity
is even greater.
• Our achievable market figure
reflects our focus on six key
geographic targets and four
product use categories.
Three key factors support our
view of the market potential for
our products:
• Our products outperform
competing materials most
strongly when used in an outside
environment. The global outdoor
wood market is estimated to be
around 14% of the global lumber
or sawnwood market;
63,344m3
Accoya sold in
this financial year
Demand drivers
There are three main of drivers of demand for our products:
1
Industry demand drivers
GDP
Rising GDP per capita, economic development
Underlying drivers include rising standards
and higher standards of living are fueling
around expectations of building usages,
construction, the principal driver of wood
performance and design, and regulatory
consumption, across the world.
changes (notably building safety, maintenance,
Construction & redevelopment
Our products are used in new constructions
and in the refurbishment, redevelopment and
remodelling of commercial and residential
buildings and projects.
sustainability and energy performance).
Construction and redevelopment is also
impacted by unexpected macro events, such
as the COVID-19 pandemic which led to
greater levels of home improvements from
consumers spending more time at home.
2
Megatrends
Sustainability
The built environment is responsible for
The trend is the same in the built environment:
almost 40% of global carbon emissions. In
around the world we can see evidence of
addition to decarbonisation, the ‘Race to
mass timber buildings using renewable,
Zero’, and setting of net zero carbon targets,
carbon-storing wood in place of concrete
there is also an increasing focus on renewable
and steel.
resources to reduce embodied carbon in
materials and buildings. In addition, many
countries and global businesses now have
mandatory, legislative targets to be carbon
neutral by 2050.
Shifting consumer priorities
Consumers in our geographic end markets
continue to shift towards products that have
a lower environmental impact, from shopping
bags and drinking straws to the cars we drive.
Lifestyle changes
Socio-economic changes are driving a
cultural shift in expectations for residences
and commercial buildings and there is an
increasing demand for high performance and
low maintenance wood products suitable for
outdoor use, with this segment expected to
grow faster than for softwood grades generally.
3
Market penetration
Our products are most frequently chosen
Market share and growth
for their characteristics, quality and
performance across all climate extremes,
and this is fundamental to our proposition.
This competitive advantage against other
woods and non-wood materials means we
believe we can grow faster than the market
through market penetration and share gains.
Since proving the commercial viability of
acetylated wood, Accsys has grown its
market share and brand awareness in the
industry through market seeding within
our current model of distributor supply
and manufacturer support.
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Market continued
Competitive advantage
and material substitution
The enhanced performance and
suitability for use in wet environments
Targeted segment
penetration
Accoya solid wood has best-in-class
properties that match or improve
upon unsustainable alternatives,
together with certified sustainability
credentials. Our acetylation process
substantially reduces the effects of
water on wood, dramatically reducing
susceptibility to swelling, shrinking
and decay.
of our Tricoya panels not only
improves their appeal compared to
traditional more expensive and less
easily handled panel products, but
also introduces new use scenarios
and design possibilities. Sales of
Tricoya panels have increased
significantly each year since
their introduction to the market
(please see pages 44 to 49 for
Architects, specifiers, manufacturers
further details).
and end users no longer need to
choose between performance
and sustainability, with Accoya
offering clear advantages over non-
renewable, unsustainable and heavily
polluting alternatives such as tropical
hardwoods, synthetics, plastics and
mined metals.
Both products also offer market-
leading warranties and service
life, along with the sustainable
benefits and credentials that make
them particularly attractive in
an increasingly environmentally-
responsible world.
With products that could be
described as disruptive to existing
materials, and with demand
exceeding production capacity, we
have focused on developing regions
and product applications which will
support rapid but sustainable growth.
The majority of Accoya sales are to a
network of timber distributors which
in turn supply a variety of industries,
principally for joinery (windows
and doors), decking and cladding.
Accoya is primarily selected for use
by architects, manufacturers and
specifiers for its high-performance
characteristics.
Tricoya panels are currently
manufactured using chipped Accoya
wood, in advance of the completion
of the dedicated Tricoya wood chip
acetylation plant in Hull, UK.
Product applications
Our products encourage manufacturers, architects, specifiers and consumers to make sustainable building
material choices on multiple global applications, without compromising on performance.
Agreements have been secured with
Route to market
MEDITE and FINSA, who use the
Tricoya acetylated wood elements
in place of traditional wood chip
feedstock to create, market and sell
Tricoya panels. Sales of Tricoya panels
have increased significantly each
year since MEDITE introduced them
to the market in 2012, being used
both in place of ‘traditional’ panels
and in applications where wood
panels would not have previously
been feasible.
By increasing our manufacturing
capacity around the world, we can
develop existing markets, expand
into new territories and grow our
product range and applications.
Our focus on marketing and selling to
our distributors and their customers
has proven to be a successful
route to establish our products
in the market as we challenge
traditional preconceptions about
material choice.
We have built and developed strong
relationships with our distributor
networks in key territories, achieved
through training, support and
engagement with both them and their
manufacturing customers. As a result,
we are able to develop brand and
product advocates throughout the
value chain.
We are also seeking to significantly
increase awareness of the benefits
of Accoya with end users and
consumers. Currently our extended
sales network, with our partners
and customers, is a major driver
of end user demand, expert
recommendation being highly
valued in our markets. However,
we are already seeing evidence of
Accoya in particular gaining a very
positive reputation with enthusiastic
property and homeowners.
The integration of our Approved
Manufacturer Programme with
location-and application-based
‘Where to Buy’ listings on our website
has resulted in significantly increased
throughput of demand to vendors
of Accoya products, benefitting
our brand, our customers, and
end consumers.
This year, we launched a new UK
national advertising campaign,
“Lasts a Lifetime”, highlighting the
high performance of Accoya wood
to homeowners. The campaign
launched with a commercial on
Sky TV targeting a subset of the
homeowner market audience,
supported by digital advertisements.
Scan here to view our
“Lasts a lifetime” commercial
DECKING
WINDOWS
DOORS
CLADDING
Wood decking has a look and feel of its own. Our
Classic looks with contemporary performance:
Industry-leading stability means that our products
Form and function combine perfectly as
products’ resistance to cracking, splinters, and
Accoya wood window frames deliver all the
won’t shrink and swell like other wood: reducing the
Accoya and Tricoya give designers, specifiers,
other effects of weather and water offers the choice
benefits and beauty of natural wood with none
chance of sticking or jamming in wet conditions,
woodworkers, architects and property
for genuinely sustainable, long-lasting decking of
of the downsides: superior thermal insulation,
and helping coatings last far longer before cracking
owners a material with boundless creative
unmistakable quality.
minimal upkeep, maximum stability, durability
or peeling. Tricoya and Accoya provide compelling
possibilities, world- leading sustainability
and sustainability.
advantages for all kinds of exterior doors.
credentials and best-in-class
long-term performance.
Demand drivers
There are three main types of drivers of demand for our products.
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Business Model
GIVING THE WORLD A CHOICE
TO BUILD SUSTAINABLY
Through sourcing, production, and bringing products to market, our business model enables Accsys to fulfil our purpose
and give the world a choice to build more sustainably.
Our activities
We combine chemistry, technology and ingenuity to make high performance wood products that are extremely durable
and stable, and opening new opportunities for the built environment. Our business and products add value at each
stage from sourcing to sale and use, through their quality, sustainability, competitive benefits and longevity.
Our activities also focus on strategic expansion of our business to capture the substantial global market opportunity
we believe is achievable with our products.
Proprietary
product
manufacturing
We manufacture our wood products
using our proprietary, wood
acetylation process at our existing
plant in the Netherlands.
Global sales and
distribution
We work with a network of global
distributors to get our sustainable
wood products to our customers,
who utilise Accoya and Tricoya
materials to create branded products
such as windows, doors, decking,
cladding, façades and other external
applications.
Responsible sourcing
We obtain the raw wood timber we
use to produce our products from
certified sustainable, well-managed
and fast-growing forests through
wood mills and wood chip suppliers
in New Zealand, Argentina, Uruguay
and the UK. We work with acetyls
providers to source acetic anhydride
and sell-back acetic acid, our reusable
by-product into the market.
Outputs
E C T S
I E R S
F
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E
P
C
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R
& S
EMPLO
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E
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S
S
R
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D
L
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R
A
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R
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N SU
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C
Our
Stakeholders
DISTRIBUTO R S
Our stakeholders
We work with our stakeholders across our business
activities. Through our business activities, we
create value for stakeholders in different ways.
Our Stakeholder Engagement report on page 67 sets
out further detail on our stakeholder relationships.
Building new plants
and optimising
existing sites
Research and
development
(R&D)
Working with
business
partners
We develop and optimise existing sites
and processes to benefit from existing
skills and leverage operational and
financial scale.
We identify new international locations
and appropriate partners to develop
additional capacity in order to meet
our longer-term growth potential in
global markets.
We have developed innovative,
proprietary and protected
technologies. We continue to
invest in R&D, focused on optimising
our existing product offering and
technologies and investing in focused
technology solutions.
Working with the right business
partners helps us maximise our
potential, enabling our growth to
realise the substantial global market
opportunity for our products.
We continue to advance our strategic
priorities, in particular by working
with partners which have resources
or technologies that complement
our own.
Forest Stewardship
Council® (FSC) certified
63,344m3
Accoya wood sold this year
+34%
FY23 revenue growth which continues
to be driven by ongoing distribution
customers
Accoya USA
joint venture with Eastman in
Kingsport, Tennessee
€1.5m
R&D investment* in FY23
* excludes capex on new technology
MEDITE
and FINSA
convert Accoya into Tricoya wood panels
Our differentiators
We utilise the following resources and relationships, which offer us a competitive advantage in our marketplace:
See our Stakeholder Engagement section | Page 67
Our technology and IP
We have developed families of patents,
providing robust protection over our
proprietary products and processes.
Our people and
engineering expertise
Our passionate employees are key to
the successful execution of the Group’s
strategy, together with their valuable
know-how and a dedication to the future
success of the Group.
Environment and
sustainability
Accoya & Tricoya fit perfectly in the
bio-cycle of the circular economy.
45 countries
in which we hold c.388
patent family members
Accoya is
Cradle to Cradle Certified®
at the Gold level
Strong industry
relationships
We work with equipment manufacturers,
wood suppliers, the acetyls industry,
testing and certification bodies, and
other system supply specialists, to help
us develop our technology, products
and their place in the market.
Industry-leading brands
Our brands Accoya and Tricoya are
globally registered trademarks,
portraying our products’ sustainable,
high quality and long-term performance.
Financial position
With continued growth in
revenue and a cash generative
Accoya business, our financial
position will support our
global growth plans.
Over 60 countries
in which our brands are
registered trademarks
+34%
Revenue growth
in FY23
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28 | Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Strategy
REALISING OUR AMBITIOUS
GLOBAL GROWTH PLAN
We have bold ambitions for growth: we successfully enhanced our production
capacity in Arnhem this year and are fully committed to further expanding our
global production capability with a focus on four strategic priorities.
Grow product
demand
Deliver manufacturing
excellence
Develop our
technologies
Continue to build our
organisational capability
200mm wide Accoya wood boards were used for the roof and fastened board-on-board. Design –
Unknown Architects, Photography – MWA Hart Nibbrig, Contractor – Kolthof BV, Location – The Netherlands
29
GROW PRODUCT DEMAND
Developing market opportunities to drive revenue growth
Our focus
• Drive sales growth in key markets and categories
• Maintain strong customer relationships,
service and support
• Build and protect our brands
• Maximise our competitive advantage through
product performance, quality, and sustainability
• Capitalise on our ideal positioning to benefit from
global sustainability and consumer megatrends
Material Issues
Sustainable & quality
products
Energy &
climate change
Responsible sourcing
Society & Communities
Read more about Our Products | Page 20
Governance, management and advocacy
2023 Progress
Looking forward
• Total sales volume up 6% at 63,344m3
• Continued strong product demand despite
• Strong customer demand with record sales in Q4
• Website conversion rate at an all-time high
• Further increase in lead generation funnel into
Approved Manufacturers
• Accoya Color sales growth in decking in DACH
region; new market launches in Australia, New
Zealand and France
• Modest volume growth and more significant
revenue growth in North America, despite major
supply constraint in H1 and a softening market
in H2
• Launch of first UK consumer (B2C) campaign:
national advertising campaign on Sky TV and digital
YouTube campaign. Total 11.2 million impressions
combined in Phase 1
slowdown in global construction industry and
softer price/demand in key timber markets; more
resource dedicated to Sales & Marketing to create
further demand as capacity becomes available
• Continued North American sales and brand
development
• System Partner expansion – co-branding with
coatings, adhesives, and hardware manufacturers
• Further expansion of B2B activities including
Approved Manufacturers Programme and
collaboration with customers
• Increasing B2C brand awareness in core markets to
drive consumer ‘pull’
• Accoya Color market expansion into North America
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 30
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Strategy continued
31
DELIVER MANUFACTURING EXCELLENCE
Growing our global manufacturing production capacity
Doing things faster, better, and more safely
Our focus
• Grow manufacturing capability and production capacity
in North America, Europe and internationally
• Optimise our plants and processes for scalable growth
• Replicate proven technology with continuous
improvements
• Ensure colleague safety across all our operations
• Partner fairly with third parties
Read more about our manufacturing expansion
in the ‘Executive Chair’s Statement’ | Page 14
2023 Progress
• Completion of Arnhem fourth reactor –
33% capacity expansion
• Good progress with Accoya USA JV with Eastman,
however project has experienced some delay and
cost inflation
• Accsys now has 100% control of Tricoya Hull plant,
construction substantially complete, project in Hold
Period while Board assesses future capability and
funding options (see page 14)
• In-year operational improvements to Accoya Color
plant in Barry to drive further volumes in FY24
• Further development of safety strategy and
culture, and increased monitoring and reporting
of safety indicators
Material Issues
Sustainable & quality
products
Energy &
climate change
Governance, management and advocacy
Responsible sourcing
Health and safety
People and wellbeing
Ecological footprint
Looking forward
• Ongoing ramp up to optimal capacity in Arnhem
• Conclusion of Board review into Hull Project and
decision on strategy going forward
• Commercial operations at Accoya USA plant now
expected mid-2024
CASE STUDY
ACCOYA DECKING
Monkey Mia, Australia
At Monkey Mia beach front, located 900km north
of Perth, Accoya decking was installed in late 2021.
These photos were taken several months later, in
August 2022, in front of the dolphin experience
centre. The area is well known for its frequently
visiting bottlenose dolphins, and the centre
maintains a positive relationship between the
dolphins and humans.
Accoya wood replaced wood-plastic composite
(WPC) decking, also being used this time for street
furniture along the boardwalk and steps to connect
the different levels. The replacement material was
required because visitors were unable to walk or sit
on the WPC decking as it got far too hot. Accoya
does not have this problem as even in the height
of summer, the low thermal gain ensures Accoya
decking is barefoot friendly.
Accoya approved distributor, M&B, supplied the
decking boards for this project uncoated. The
natural Accoya wood has already started weathering
and the photograph below of the steps shows the
colour difference in the first 10 months.
PRODUCT DETAILS
Distributor: M&B
For more Accoya projects go online to | www.accoya.com/uk/projects
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Our Strategy continued
33
DEVELOP OUR TECHNOLOGIES
R&D of product and process-related technologies and IP to
protect and grow our leading market position
Our focus
• Pursuing process technology to enhance efficiency
Material Issues
• Optimising existing products
• Protecting our IP
• Sourcing responsibly
• Lowering resource use and incorporating
circular processes
Sustainable & quality
products
Innovation and
technology
CONTINUE TO BUILD OUR
ORGANISATIONAL CAPABILITY
Developing our people and organisational capabilities to manage our growth
Our focus
• Talent management: adding new skills and talent
• Developing our people: Leadership & Training
• Engaged workforce
• Living our values and culture
Material Issues
Governance, management and advocacy
Read more about Innovation & Technology | Page 39
Read more about our Senior Leadership Team | Page 76
People & Wellbeing, Fair & Ethical Conduct
2023 Progress
Looking forward
2023 Progress
Looking forward
• Expansion of Global Technology Centre and R&D
• Ongoing improvements to overall production
team to drive growth through innovation and
process efficiencies, including new quality
continued improvements to Accoya and Tricoya
scanning capabilities of wood handling process and
business activities
equipment
• Installation and start up of new automated wood
• Longer-term research into potential for additional
handling equipment in Arnhem to improve wood
product categories as overall capacity increases
handling and efficiency
• Continued development and expansion of our IP
• Ongoing research into alternative sourced wood
portfolio to support business strategy
species’ performance, resulting in the commercial
launch of Accoya made from Taeda (see page 39)
• Steady production at Accoya Color plant in Barry;
improved production cycle time leading to
higher volumes
• Continued and expanded IP protection, and
safeguarding freedom to operate, in various areas
applicable to the Accoya and Tricoya businesses
• Continued research into, and assessment of,
alternative raw materials supply options
• Preparations for Kingsport Accoya production site
commissioning and start-up in mid-2024
• Further strengthening of manufacturing expertise
• Improving capital project delivery: stronger project
and leadership through appointments of new
management and contracting practices
Group Manufacturing and Projects Director and
new MDs for Hull and Barry plants
• Increased investment in training and development
to support skills and talent pipeline; significant
increase in colleague training modules and training
hours per colleague
• Post the year end, in April 2023 the Company
announced the appointments of a new CEO and
CFO, with significant experience in large capital
project management, cost management and
financial forecasting
• Ongoing progressive enhancement of processes
and management systems
• New leadership training programmes and talent
mapping, to ensure we have the right skills and
talent in place to grow our business effectively
• Continued improvements resulting from colleague
survey feedback
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 34
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Business Review
SUCCESSFUL
EXPANSION OF
CAPACITY IN FY23
The successful construction and completion of a fourth Accoya
reactor in Arnhem, together with reactors 1-3 returning to
production after the Arnhem plant’s shutdown in April and May,
has led to our highest ever volume production in Q4.
ACCOYA SALES VOLUME
63,344m3
Overview of the year
Demand for our Accoya and Tricoya
wood was strong (and in excess of
our capacity) as customers continued
to seek products that deliver
outstanding performance, durability
and sustainability.
Despite the production outages
linked to the completion of reactor
4 highlighted above, the Company
delivered very strong revenue growth
for the year, underpinned by strong
product demand and increases in
average sales prices.
Underlying EBITDA more than
doubled year on year, due to increased
average sales prices and an energy
price surcharge mechanism which
successfully offset raw material cost
increases, including the impact of high
and volatile prices for acetic anhydride
used in our acetylation process, and
energy prices in Europe. Despite
general price reductions in the global
wood products market, the Company
has maintained its prices in H2 and
into FY24. The energy price premium
ceased to be applied beyond the end
of FY23.
In November we announced that,
while we had taken 100% control of
the world-first Tricoya project in Hull,
we also put the project into a hold
period to assess future capability
and funding options. Please see the
Executive Chair’s statement on page
14 for further details on progress the
Board has made with its review.
35
We have made good progress with
our Accoya USA JV with Eastman.
However, construction of the plant
(which commenced in April 2022) has
experienced some delays and cost
inflation. Both Accsys and Eastman
remain fully committed to delivering
the project, which will replicate the
proven technology of our successful
Accoya plant in Arnhem.
FY23 has been another important
year for customer relationships,
during which we have had to manage
inflationary cost increases through
higher prices, ongoing disruption
to supply chains post the COVID-19
pandemic and our own production
capacity limit in the face of strong
customer demand. We are grateful
to our customers for their continued
support and have engaged in regular
dialogue with them as we navigate
Summary of financial
performance
Accsys delivered revenues of
€162.0m, a 34% increase on
FY22, reflecting continuing
strong demand for our
products, higher average sale
prices and the implementation
of an Energy Price Premium
to mitigate higher gas prices.
Sales volume grew by 6%
during the year to 63,344m3,
with H2 volumes of 39,387m3
representing growth of 64%
on H1, in excess of our targeted
50% increase.
Underlying Group EBITDA was
€22.9m, an increase of 120%
on the prior year, and ahead of
our market guidance of nearly
doubling last year’s EBITDA
these challenging market conditions.
of €10.4m.
During the year Accoya’s high level
of performance and sustainability
was recognised in several prestigious
global industry awards. Please see
page 16 for further details.
Group gross margin remained
above our long-term target
of 30% at 34%, aided by the
higher average sales prices
outlined above. In addition, we
continue to benefit from a partial
natural hedge on our acetyls raw
materials cost through the sale
of our acetic acid by-product,
revenues of which grew by 11%
in the year to €15.1m. Underlying
profit before tax increased by
€9.7m to €11.0m. Statutory loss
before tax was €67.1m.
Net debt increased by €16.9m
in the year to €44.1m due to
the planned investment into
Accoya USA, (€29m), capex
investments of €29.8m into
the Arnhem reactor 4 and
Tricoya Hull projects (partially
offset by a placing in May 2022
which raised net proceeds
of approximately €19m), the
reduction in the NatWest loan
(€9.4m) and EBITDA generation
during the year.
During the year, Accoya’s high level of
performance was recognised in several
prestigious global industry awards.”
Laura Keily
Head of Marketing
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
37
Business Review continued
Strategic Update
Accoya
During the period we were pleased to
complete the expansion of our plant
in Arnhem which adds a new 20,000
cubic metres reactor, enabling the
site’s maximum annual capacity to
increase to 80,000 cubic metres.
As previously reported, we
experienced some unexpected
delays in the final installation, tie-ins
and supply of certain equipment
for reactor 4, which resulted in an
unexpected second shutdown across
the plant in April and May 2022. In
addition, during the commissioning
and testing period in June, we
identified a number of defects to
equipment which were repaired over
the following eight weeks.
As a result, reactor 4 commenced
commercial operation in September.
Further work on optimising reactor
4 – to reduce cycle times and deliver
more capacity – is planned for the
coming year. In addition, investment
in new stacking technology is
ongoing which will provide efficiency
improvements across the plant’s
work centres.
North America represents the largest
potential regional market for our
product. Under our joint venture
with Eastman, a world leader in
the production of acetyls, we are
building an Accoya plant in the USA
with an initial approximate 43,000
cubic metres capacity at Eastman’s
Kingsport, Tennessee site. Under the
joint venture, Accsys holds a 60%
interest and Eastman a 40% interest.
We have made excellent progress
During the year we made operational
with the construction of the plant,
improvements to the site which
which commenced in April 2022. Key
enabled us to increase production by
milestones include the completion
140% to 4,010 cubic metres in FY23.
of ground works, ongoing steelwork
More importantly, this will allow us to
and main warehouse construction,
further increase future production
installation of the reactors on site,
in FY24 and to support growing
placement of multiple large sub-
customer demand.
contracts and procurement of more
than 80% of major equipment. As
we move towards completion of the
plant, we will increase our investment
in people and infrastructure in
readiness of start-up and as a result,
the project will incur higher losses
in the coming year. As announced
in May, the project has experienced
some delays related to mechanical
completion, as well as the impact
of cost inflation. Both joint venture
partners continue to be fully engaged
Accoya Color’s unique proposition
is proving to be very attractive to
customers in our target markets,
particularly in the decking category
where the surface-to-core grey
colour requires less maintenance to
retain over the long term. In addition
to the product’s existing markets
of Germany, Switzerland, Austria
and US, Accoya Color was launched
this year into the new markets of
Australia, New Zealand and France.
in delivering this strategically
Accoya Color generates a higher
important project, which will replicate
gross profit per cubic metre than
Accoya and will enhance our product
margins over time. As we increase
our Accoya production capacity, we
continue to expect increased Accoya
Color sales in the medium term.
the proven technology of our
successful plant in Arnhem.
In line with our group commitment
to Health & Safety, this has been
established as a key priority at the
site and by the FY23 year end we
were able to celebrate over 150,000
hours worked with only one minor
first aid injury.
Our 50,000 square foot Accoya Color
manufacturing plant in Barry, Wales,
has increased our ability to convert
Accoya wood into Accoya Color – a
product which combines the benefits
of Accoya wood with colour all the
way through the wood from surface
to core. The site has an maximum
capacity of 12,500 cubic metres
per annum.
CASE STUDY
PACIFIC COAST
HOME FEATURES
ACCOYA
San Diego, CA, United States
Accoya wood, known for its durability and resistance
to warping, was the ideal choice for a Pacific Ocean
residence designed by Greg Coleman Architects. The
project aimed to create a beautiful, long-lasting space
for the homeowners to enjoy the stunning ocean views.
The architects used approximately 1,900 square feet
of Accoya wood that was milled into 2×2 slats. The slats
were installed as a privacy screen around the second
floor decks and for the railing at the exterior stair for
the ADU. Accoya wood’s stability and resistance to
warping made it an ideal material for the 2×2 slats, as
other cladding options, such as Ipe, would have been
more challenging to work with.
AWARD WINNING
Accoya wood was chosen as it met the project’s goals
of creating a beautiful and durable outdoor space.
Due to its durability, Accoya wood requires less
maintenance and refinishing, which made it a cost-
effective and practical choice for the project.
The installation was completed by California Deck
Pros, who did an excellent job creating a beautiful
and functional outdoor space. RGB Inc. served as
the general contractor for the project and oversaw
the installation.
The project was honoured with the award for
Residential Project of the Year 2022 by AIA San Diego.
PRODUCT DETAILS
Accoya cladding
Architect: Greg Colman Architects
Installer: California Deck Pros
General Contractor: RGB Inc.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
39
Business Review continued
Strategic Update continued
Building Organisational
Capability
Innovation & Technology
This year we were pleased to see
We conduct regular strategic reviews
We are making good progress
of our engineering and technology
in developing our people and
capabilities and other actions to
organisational capabilities to
drive improved delivery of capital
manage growth. As we increase
and innovation projects. This led
our manufacturing output, we are
to the creation in FY22 of a Global
strongly focused on strengthening
Engineering Centre and Project
our manufacturing expertise and
Management Office, and further
leadership. Key senior management
development of our R&D function.
appointments during the year include
During the year, we increased our
a Group Manufacturing and Projects
skills and talent in key areas including
Director, a newly created role which
project and portfolio management
will support Accsys as we expand our
in addition to engineering,
operations and develop our global
wood (modification) science and
reach. Management has also been
analytical capabilities.
strengthened by the appointments
of new Managing Directors of Tricoya
UK and Accoya Color.
Our R&D team is focused on both
process and product innovation
positive results from long-term trials
of Accoya made from fast growing
Taeda pine from Argentina and
Uruguay with ideal growing conditions
and forestry practices and mills that
can meet our requirements. For
example, Accoya cladding made from
Taeda has been used to clad the
Starbucks building in Wakefield, UK.
Installed in 2020, it has shown the
same durability and performance as
Radiata pine. Being able to source
Taeda from South America also makes
it an ideal option for supply to the
Kingsport, Tennessee plant. Over the
coming year, we will be continuing this
work with the view to beginning official
commercial production of Accoya
which impact the short, medium and
with Taeda.
Image by FINSA
Tricoya
Accsys and its former consortium
partners in Tricoya UK Limited (TUK)
have been building the world’s first
Tricoya plant in Hull.
In November 2022, Accsys agreed
with its partners – Ineos, MEDITE,
BGF and Volantis – to acquire
100% ownership of the plant and
the Tricoya Group entities (Tricoya
Technologies Limited and TUK), in
exchange for 11.9m new shares in
Accsys, representing 5.74% of its
issued share capital at that date.
Ineos and MEDITE remain commercial
partners with Accsys, retaining
their respective acetyls supply
and acetylated wood chip off-take
agreements.
The reorganisation gives Accsys the
The Company stopped site activity
option to take the Tricoya Hull Project
in November, placing the project
forward on its own terms and to
into a hold period to mitigate the
benefit from 100% of the long-term
risk of weaker economics on start-up
returns from Tricoya, including any
(due to the high and volatile acetyls
future licencing in respect of the
raw material prices in Europe) and
global Tricoya market opportunity.
to allow the Board time to assess
At the same time, the Company
announced the restructuring of the
debt arrangements between TUK and
the economics and capability of
the plant and its potential returns
on investment.
NatWest, resulting in the principal
While further work is required to
debt being reduced by €9.4m to
prove the working capabilities of
€6.0m with a new seven-year term,
the plant, we have made significant
and no capital repayments during
and positive progress on this review
this period.
over the past six months. Please see
further details on progress with the
Board’s review on page 14 of the
Executive Chair’s Statement.
Post the year end, the Company
long-term future of the business.
has also boosted its expertise in
With production capacity recently
the areas of large capital project
expanded in Arnhem, process
management, cost management
optimisation and reliability remain
and financial forecasting through
core areas of focus. Our R&D
the appointments in April 2023 of
team works closely with our Sales
a new CEO and CFO, both of whom
& Marketing teams to understand
have significant experience in these
evolving consumer needs and to
areas. For full details of these key
assess where innovation can meet
appointments, please see page 16.
those needs.
We rely on the skills, experience
To build resilience and mitigate risk in
and commitment of our people to
our supply chain, our R&D and supply
meet our business goals and to that
chain teams have been exploring
end, are committed to investing in
alternative wood species to Radiata
their careers. During the year we
pine. The properties of Radiata pine
increased the number of training
from certain regions make it well
and development opportunities for
suited to our proprietary acetylation
our colleagues around the Group,
process. It is also fast growing and
providing 8,579 total training hours
available from certified sources,
in FY23, representing 32.5 training
making it a sustainable choice.
hours per colleague. This year’s
However, we want to broaden our
performance is an increase of 526
wood supply, both in terms of species
hours on the prior year and 4,619
and source location to de-risk our
hours since FY21. Together with new
operations as we grow.
leadership training programmes and
talent mapping, this is an ongoing
process to ensure we have the right
skills and talent in place to grow our
business effectively.
Accsys produces acetic acid as a
by-product of its wood acetylation
process. This Accsys acetic acid has
been proven to be of good quality
and of low environmental footprint.
For years, Accsys acetic acid
customers have recognised these
qualities and proven that it can be
used, undiluted or diluted, for many
standard acetic acid applications, e.g.
in water treatment or as chemical
raw material for solvents like acetic
anhydride. However, it does have
some differences to glacial acetic
acid (notably, a slightly lower purity
with some content from wood
extractives or slightly higher colour).
To address these differences, Accsys
acetic acid from wood acetylation
can be further purified in order to
reach a quality equivalent to standard
glacial acetic acid. This purified acetic
acid can be used with almost no
restriction in most glacial acetic acid
markets/applications (e.g. in Vinyl
Acetate, Acetic Anhydride, Mono
Chloro Acid, Pure Terephthalic Acid,
Butyl or Ethyl Acetate).
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 40
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Business Review continued
Intellectual Property
Building on our commitment to
During FY23, we held regular safety
Accsys continues to invest in
developing and protecting its
valuable portfolio of intellectual
property and confidential
information. Our technology covers
not only the physical equipment
and engineering that underpins our
manufacturing and production, but
transparency, Accsys participated
briefings for all colleagues and have
for a second consecutive year in the
issued monthly communications
S&P Global Corporate Sustainability
to encourage greater awareness
Assessment. Accsys scored 43/100 –
of safety. As awareness around
an improvement of five points (13%)
safety grows, we have seen
on the prior year, placing the Company
corresponding improvements in key
in the top quintile in the ‘Paper &
HSE performance metrics. During the
Forest Products’ industry category.
year, we introduced a digital version
also the processes and methodology
Through our expanding safety
we follow in our supply and
programme, which includes increased
production chain: from the way we
monitoring, a defined strategy
and increasing awareness, we are
building a stronger safety culture
across the organisation. During
the year, the Company rolled out a
number of dedicated safety learning
programmes and initiatives, including
a Health & Safety month in February
2023 which gave our colleagues the
opportunity to participate in group
discussions on safety improvement,
training sessions and guest
speaker events.
of our safety observation card,
submissions of which grew from 1,060
in FY22 to 1,316 this year. In addition,
we have maintained our momentum
in leadership safety tours, holding
almost 700 tours over the year. We
are pleased to report that our Total
Recordable Incidence Rates improved
from 5.2 to 3.6 per 200,000 hours
worked. Our Lost Time Incident Rate
per 200,000 hours worked, however,
increased from 0.52 to 0.96 (versus
our target 0.5).
Energy & Climate Change
Our approach to Energy & Climate
During the year, we completed a
includes a focus on energy efficiency
Board performance evaluation and
and process optimisation, assessing
internal review which complements
the carbon impact of our products
our three-yearly cycle of external
and integrated climate considerations
evaluations. The results of the
and activities across multi-functions
evaluation confirmed the individual
across the business.
source our wood, through our wood
modification process, to the way we
market and sell Accoya and Tricoya.
Accsys’ holds c.388 patent family
members covering 28 distinct
inventions in 45 countries with 75%
of the patent family members now
granted. The core technologies
associated with our current and
future plants for the production of
Accoya and Tricoya wood products
are protected by using a combination
of patenting and trade secrets
to maintain our differentiation in
the marketplace and interest to
potential licencing partners. Our
principal trademark portfolio covers
our Accoya and Tricoya brands, the
Trimarque device and the Accsys
company name, protected by
registrations in over 60 countries.
ESG
and collective commitment and
effectiveness of Directors. The
evaluation also supports the Board in
understanding areas of focus as part
of its continuous improvement.
With its stated purpose of ‘Changing
wood to change the world’, Accsys is
Health & Safety (HSE)
committed to growing and operating
Health & Safety is a top priority
its business in a responsible and
sustainable way. Aligned with our
for the Board and for Accsys, and
the Board-level HSE Committee,
values and business strategy, our ESG
established in 2022, has helped
framework outlines 10 key material
support the Board’s focus on this
issues and impact areas on which we
key area. Accsys has set ‘Zero Harm’
as a key target for our operations
and is committed to developing best
practice HSE across the Company.
are primarily focused.
Having completed Stage One of our
2020 sustainability strategy roadmap,
we are now in Stage Two and are
focused on establishing specific
development plans, including setting
Science Based Targets (SBTs) to
reduce our emissions intensity per
cubic metre of Accoya produced.
We are innovating to minimise
our environmental impact across
our operations, in accordance
with our Climate Change Policy,
whilst sourcing our raw materials
responsibly. In 2023, we established
a steering committee at our Arnhem
site to focus on carbon intensity
reduction per cubic metre of
Accoya produced. Additionally, we
are using our Scope emissions data
to set carbon reduction targets in
alignment with the Science Based
Targets initiative (SBTi). Scope 1 and
2 emissions can be seen on page 62.
41
CASE STUDY
THE RISE OF THE
‘CRESCENDO’
SERIES
Ouray, Colorado, United States
Award winning artist Cie Hoover created the first of
many inspirational sculptures out of Accoya wood.
In 2020, Cie had a wood-based sculpture titled
‘Balance in the Fray’ permanently installed in a covered
setting in the town of Alamosa, Colorado. From there,
he wanted to continue to explore the realm of public
art and set out on a quest to find a wood suitable for
outdoor installations…and thus came across Accoya.
‘Crescendo’ stands at roughly nine feet tall and is now
installed in the town of Fraser, Colorado. (Photo shown
is from a temporary installation of the sculpture for
Telluride Art + Architecture in July of 2022).
A second, even larger version of the sculpture is
currently being created, and will permanently reside in
the town of Ridgway, Colorado.
Art can be expensive and is
not always accessible to many
individuals…this is why public art
is so important. It allows art to
be accessible to EVERYONE.”
Cie Hoover
Artist
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Business Review continued
Society & Communities
Accsys has developed a more
Sustainable & Quality
Products
Board Update
The Board’s composition brings
structured approach to charitable
We are committed to a more
depth and a range of experience
and community support and its
sustainable world and use abundantly
to Accsys, both supporting and
environmental impact through
available wood sources, certified
challenging the Executive team in the
tools such as charitable giving and
as sustainable by the FSC®. Our
execution of the Company’s strategy.
colleague engagement. During
commitment to responsible sourcing
the year, our colleagues chose
and manufacturing is recognised by
three official charity partners to
leading accreditation bodies. This
support, pledging total donations
year we achieved Cradle to Cradle®
of €72,219, and participating in our
(C2C) gold certification for Accoya
chosen charities’ missions through
Color Grey, as well as being awarded
a number of activities, events and
‘Platinum’ level (the highest level) for
presentations.
In January, we organised a colleague
volunteering day with our charity
partner Trees4All. Accsys colleagues
both ‘Material Health’ and ‘Water
Stewardship’. Our core product,
Accoya, has held C2C certified status
since 2010.
The last 12 months has seen
considerable change, with Rob Harris,
Accsys’ Chief Executive Officer,
stepping down after three years,
and Will Rudge deciding to leave the
Company after 12 years as Finance
Director. Rob Harris is succeeded
by Dr Jelena Arsic van Os, who will
become Accsys’ Chief Executive on
1 July 2023, at which point Stephen
Odell will return to his prior role as
were invited to join volunteers from
C2C certification is the global
Independent Non-Executive Chair
across the Netherlands to plant
standard for products that are safe,
of Accsys.
trees in the Groene Woud, NL. The
circular, and responsibly made.
day resulted in around 2,000 trees
Accoya wood is one of the very few
going into the ground and gave our
building products to have acquired
colleagues the opportunity to give
C2C certification on the stringent
back to the local community and learn
Gold-level. This represents very high
standards of sustainability, alongside
the recognised high performance and
durability credentials of the brand.
about reforestation.
A one-off donation was also approved
by our Charities Committee to
support the Turkey/Syria Earthquake
appeal in support of several
colleagues who had relatives and
friends in affected areas.
Jelena has over 20 years’ experience
in senior executive leadership roles
in large-cap multinational companies
and has a proven track record in
transforming and driving complex
businesses, delivering on profitable
growth targets and successfully
delivering large capital projects.
Accoya window and doors, Brighton, United Kingdom
43
Will Rudge is succeeded by Steven
Salo, who joined Accsys on 1 April
2023 as Chief Financial Officer.
Steven brings significant experience
in senior financial leadership roles,
executing high-value corporate and
business development transactions,
and driving and shaping businesses
for profitable growth.
Post the year end, in May 2023 the
Company announced that as they
reach the end of their nine-year
terms, Sue Farr and Sean Christie,
who chairs the Audit Committee,
will step down from the Board at the
conclusion of the AGM in September
2023. In addition, due to increases
in his executive commitments,
Alexander Wessels, who chairs the
Company’s Remuneration Committee,
will also step down from the Board at
the upcoming AGM.
As at the date of this report, the
Board is seeking to appoint two
new high-quality and experienced
Independent Non-Executive
Directors, with the intention of one
as Chair of the Audit Committee,
and the second as Chair of the
Remuneration Committee.
Further reading
See Our Strategy |
Pages 28 to 33
See our Sustainability section |
Pages 56 to 66
See our Finance Review |
Pages 44 to 49
ZahBuilt
Outlook
In the coming year, we expect to leverage the benefits from greater
economies of scale associated with higher production volumes at
our plants. FY24 will also be a year of transition, during which we will
implement actions to ensure the future sustainable growth of the
business and to drive value creation for our shareholders. These actions
include moving towards completion of the Kingsport plant, which will
incur higher costs this year as we invest in people and infrastructure in
readiness for start-up and making key investments in the core business
to support higher volume production. In view of our increased capacity
from the expansion of Arnhem and future capacity from Kingsport, and
in light of the softening of price and demand in the global construction
industry, we are dedicating more resource to our sales and marketing
activity globally, particularly in the US, to create more demand as supply
becomes available.
The Board of Accsys continues to believe in the underlying attractive
economics and margins associated with completing the construction
of Hull and therefore will continue to explore financing options to fund
the plant’s construction, including strategic partners and lending
institutions. Absent the availability of third-party funding, the Company
will use modest levels of internally generated cash to maintain the plant
and progress the pre-construction works. The Board will continue to
engage with stakeholders in respect of Hull and its future prospects.
Despite its belief in the future potential for Tricoya, the Board is clear
that the base Accsys business must not be compromised to find a
solution for Hull. In the meantime, we will continue to work with our
partners to develop the Tricoya market using Accoya, including exploring
the expansion of dedicated capacity for greater volume production
within our existing plants.
We have made a good start to FY24, with performance in line with our
expectations. With our new executive management team in place to drive
the business forward in its next phase of growth, we are confident in
delivering further financial and operational progress in the coming year, and
in the longer-term demand and growth opportunity for Accoya and Tricoya.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
44
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Finance Review
Accsys delivered a good performance in
the year, with 34% revenue growth and
a 120% increase in Underlying EBITDA.”
Steven Salo
Chief Financial Officer
Group Revenue
Gross Profit
Underlying EBITDA
Underlying EBIT
Underlying profit before tax
Statutory (loss)/profit before tax
Cash
Adjusted cash
Net debt
Accoya Sales volume
2023
2022
€120.9m
GROUP REVENUE
€162.0m
+34%
€162.0m
Introduction
Accsys has delivered a good
performance in the year, with 34%
revenue growth and a 120% increase
in Underlying EBITDA to €22.9m,
driven by increased sales prices
and strong ongoing demand for
our products.
Net debt increased by €16.9m in the
year to €44.1m due to the planned
investment into Accoya USA, (€29m),
capex investments of €29.8m into
the Arnhem reactor 4 and Tricoya
Hull projects (partially offset by a
successful placing in May 2022 which
raised net proceeds of approximately
€19m), the reduction in the NatWest
loan (€9.4m) and EBITDA generation
during the year.
In November 2022, Accsys agreed to
acquire full ownership of the Tricoya
entities, including the Tricoya Hull
Change
%
34%
53%
120%
243%
FY23
FY22
€162.0m
€120.9m
€55.2m
€22.9m
€14.4m
€11.0m
(€67.1m)
€26.6m
€16.8m
€36.0m
€10.4m
€4.2m
€1.3m
€1.7m
€42.1m
€4.3m
(€44.1m)
(€27.2m)
63,344m3
59,649m3
6%
plant from its consortium partners
for a consideration in Accsys shares
(valued at €9.5m). At the same time,
the debt facility between TUK and
NatWest was restructured, resulting
in the principal debt being reduced
to €6m, with a new seven-year term
and no capital repayments during
this period.
Following these events, an
impairment assessment was required
to be performed under IAS 36
(Impairment of Assets) on the
Tricoya segment’s gross assets with
an impairment loss of €86m being
recognised as non-cash exceptional
item. The calculated impairment was
impacted by:
(1) A previously reported increase
in the capex to complete the
construction of the Tricoya Hull
plant of €35m, commencing in
2 years;
45
2023
€11.0m
2022 €1.3m
UNDERLYING PROFIT
BEFORE TAX
€11.0m
+€9.7m
2023
€(44.1)m
2022 €(27.2)m
NET DEBT
€(44.1)m
+€16.9m
(2) A higher pre-tax WACC rate
Sales volumes increased by 18% to
(used for the discount rate)
our Tricoya customers (MEDITE and
increasing by 3.0% to 13.5%
FINSA) following a drop in allocation
principally due to higher market
in FY22. These sales to MEDITE
interest rates; and
and FINSA for the manufacture of
(3) A decrease in the production
volume forecast for the plant to
24,000MT (from 30,000MT).
Statement of
comprehensive income
Group revenue increased by 34%
to €162.0m for the year (FY22:
€120.9m), driven by continuing
strong market demand for Accoya
and Tricoya and an increase in
average sales prices during the
year and prior year implemented to
address rising raw material costs. An
energy price premium (surcharge)
was also successfully added to
Tricoya panels are used to develop
the market for Tricoya products
and represent 24% of Accoya sales
volumes (FY22: 22%).
Other Revenue, which predominantly
relates to the sale of our acetic acid
by-product, increased by 21% to
€16.8m (FY22: €13.9m) due to higher
acetic acid sales volume following the
ramp up of production from reactor 4
in Arnhem. Accsys’ sales of its acetic
acid by-product back into the same
acetyls market continued to act as
a partial hedge to the higher acetic
anhydride costs. The net acetyls cost
increased by 19% compared to the
customer sales prices in H1 to offset
prior year.
a significant increase in acetyl costs.
Accoya sales volumes increased 6%
to 63,344m3 following the successful
commissioning and operation of
reactor 4 in September 2022.
We have continued to see strong
underlying demand for Accoya across
our regions and with our Tricoya
panel manufacturing partners. The
FY23 regional sales trend on a year-
on-year basis reflects a 10% increase
in sales volumes in North America,
Raw wood input costs were
moderately higher although more
stable than the wider lumber market
as we purchase appearance-grade
wood under long-term supply
contracts with many of our partners.
Cost of sales increased by 26%, on
6% higher sales volumes and higher
cost of raw materials, primarily
in higher raw wood and acetic
anhydride costs.
where we continue to increase
Group gross profit of €55.2m was
marketing, sales, and allocation
53% higher than the prior year
of product volumes available to
(FY22: €36.0m) and gross profit
customers as we develop this market
margin increased 4 percentage
ahead of our US capacity expansion.
points to 34%.
Sales volume by end market
UK & Ireland
Tricoya
Rest of Europe
Americas
Rest-of-World
Total
FY23
m3
14,667
15,193
16,584
10,574
6,326
63,344
FY22
m3
14,905
12,860
16,809
9,575
5,500
59,649
Change
%
(2%)
18%
(1%)
10%
15%
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
46
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Finance Review continued
Underlying other operating costs
An exceptional foreign exchange gain
Underlying earnings per share
(excluding depreciation and
of €1.4m was recognised related to
increased to €0.05 per share
amortisation) increased from €25.4m
US dollars held as cash for investment
(FY22: €0.01 per share). A statutory
to €31.6m. This is due to Tricoya’s
into Accoya USA, which were invested
loss per share was recognised of
ongoing running costs being treated
into the joint venture in the first
€0.19 per share (FY22: profit of
as operating expenditure in the
half. Following the May 2021 capital
€0.01 per share).
did not decrease the amount raised
below the future US dollar investment
(FY22: €11.4m), reflecting continued
second half following the introduction
raise, the amount raised to invest
of Tricoya UK’s hold period and
into Accoya USA was translated into
increased legal, insurance and staff
US dollars and held in cash, ensuring
costs during the year.
that foreign exchange movements
Depreciation and amortisation
charges increased by €2.1m to €8.3m
following commercial production
from reactor 4 in September 2022.
into Accoya USA. This treatment
did not meet the requirements for
hedge accounting under IFRS 9,
Underlying finance expenses
Financial Instruments, and therefore
increased €0.3m to €3.2m following
the foreign exchange gain on the
the interest on Tricoya UK’s NatWest
revaluation of the US dollars has been
facility not being capitalised post the
accounted for in Finance Expenses as
introduction of the hold period for
an Exceptional item.
Tricoya UK and a full year of interest
cost on the De Engh €10m loan which
was entered into March 2022.
In the prior year, redundancy costs
of €0.1m were recognised in relation
to the purchase of assets in Barry,
Cash flow
Cash flows generated from operating
activities before changes in working
capital increased by €11.3m to €22.7m
good operational cash flow generated
by our plant in Arnhem.
Inventory levels increased by €9.6m
during the year with higher raw
material levels held due to the ramp
up of the fourth reactor, which
increases production capacity by
33% but which was also partially
impacted by the delay in start-up of
reactor 4 and the long lead time for
raw material purchases from New
An impairment loss (exceptional item)
UK and €1.6m early termination costs
Zealand. Inventory balances started
of €86.0m has been recognised
in the year relating to the Tricoya
related to the refinance of the Group
to decrease in H2 and are expected
debt facilities in October 2021, with
to continue to decrease further in the
segment. The calculated impairment
both classified as exceptional items.
next financial year.
is described in the Introduction and
has been recognised as a non-cash
exceptional item.
No other adjustments have been
recognised in the current year, which
were previously also excluded from
In regard to the Tricoya Consortium
underlying results. These other
reorganisation completed during the
adjustments related to foreign
year, the following exceptional items
exchange differences on the US
In May 2022, Accsys completed a
successful placing for an issue of
shares in the Company, raising net
proceeds of approximately €19.0
million which have been used to
strengthen the Group’s balance
sheet, increase liquidity headroom
and provide additional working capital
and fund additional costs to complete
Arnhem’s expansion project.
At 31 March 2023, the Group held
cash balances of €26.6m, a €15.5m
decrease in the year, attributable
to construction costs relating to
dollar cash pledged to ABN Amro for
the Letter of Credit provided to First
Horizon Bank (‘FHB’) as part of the
Accoya USA funding arrangements
and Pound sterling loan notes repaid
in the October 2021 Group refinance.
See note 5 for further details.
Underlying profit before tax increased
have been recognised:
• €1.5m expense for advisory
fees incurred;
• €9.4m income related to the
restructuring of the NatWest loan,
decreasing the principal debt from
€15.4m to €6m; and
• €1.4m expense related to the value
recovery instrument provided to
NatWest, allowing NatWest to
recover up to approximately €9.4m,
on a contingent basis, depending
on the profitability of the Tricoya
Hull plant once operational (see
note 23).
by €9.7m to €11.0m (FY22: €1.3m).
the Arnhem plant expansion project
After taking into account exceptional
(€7.9m), Tricoya Hull project (€20.1m),
items (including the impairment
loss) and other adjustments, loss
before tax amounted to €67.1m
(FY22 profit: €1.7m).
The tax charge increased by €1.8m to
€2.8m (FY22: €1.0m).
the planned investment into Accoya
USA (€29m) and the increase in
inventory referred to above. This was
partially offset by the placing, €10.0m
of proceeds from loans (explained
further below), and cash flow
generated from operating activities.
For more Accoya projects go online to |
www.accoya.com/uk/projects
47
CASE STUDY
MOVEART
CHOOSES ACCOYA
FOR SCULPTURE
London, United Kingdom
To create a sense of peace and inspiration in a densely
populated area, leading manufacturers moveART
designed these Accoya wood sculptures, which have
successfully brightened up Nine Elms in London.
The regeneration of Battersea Power Station, located
in Nine Elms, opened its doors in late 2022, attracting
people to visit its shops, restaurants, and other
attractions for the first time. Therefore, the tranquillity
the moveArt sculpture brings is more essential than
ever, specifically for the increasing number of residents
in the Nine Elms area.
moveART is a Swiss company established by designer
Norbert Roztocki, who is passionate about keeping
people physically and mentally healthy, especially in
overpopulated urban areas. moveArt does this by
providing art, functionality, and security to public
spaces that integrate and inspire people.
Roztocki specifically chooses Accoya sustainable wood
for all sculptures due to its exceptional durability
and stability and the all the sustainability benefits
that come with such a high-performance wood.
Swiss moveArt sculptures is another example of
Accoya moveART.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
48
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Finance Review continued
When adjusting for the cash pledged
Trade and other payables decreased
Net debt increased by €16.9m in the
for the Letter of Credit provided to
€4.0m to €25.9m (FY22: €29.9m),
year to €44.1m (FY22: €27.2m) due
FHB of $10.0m (see note 30), and
with a decrease in accruals following
to capex investments of €29.8m,
in the prior year adjusting for the
the completion of the Arnhem
investment into Accoya USA (€29m)
remaining cash raised in the May
expansion project and the decrease
and the increase in inventory partially
2021 equity raise to be invested
in activity on the Tricoya plant in Hull.
offset by the successful placing
into Accoya USA, Adjusted Cash
increased during the year to €16.8m
(see note 30).
Financial position
Plant and machinery additions of
€21.4m (FY22: €41.0m) consisted
of the construction of reactor 4 in
Arnhem and the Tricoya plant in Hull.
Trade and other receivables
Amounts payable under loan
agreements increased to €65.9m
(FY22: €64.0m) due to the drawdown
of €5.0m on the ABN Revolving credit
facility and €5.0m on the Tricoya
NatWest €17.2m facility, capitalisation
of interest on the Tricoya NatWest
loan before the Tricoya NatWest
facility was restructured, decreasing
the principal debt from €15.4m
increased to €18.1m (FY22: €16.9m),
to €6.0m.
primarily due to higher sales following
the ramp up of reactor 4.
(net proceeds of €19.0m), cash flow
generated from operating activities
and the restructuring of the Tricoya
NatWest facility, decreasing the
principal debt on the facility by
€9.4m to €6.0m.
49
Group Underlying EBITDA 2019-2023
€ million
£22.9m
£0.9m
FY19
£7.0m
FY20
£10.1m
£10.4m
FY21
FY22
FY23
Going concern
The consolidated financial statements
are prepared on a going concern
basis, which assumes that the Group
will continue in operational existence
for the foreseeable future, and at
In both scenarios, the Directors
The Directors believe that while
have assumed no commitment will be
some uncertainty always inherently
made to complete the construction
remains in achieving the budget,
and start-up of the Tricoya plant
in particular in relation to market
in Hull until appropriate funding
conditions outside of the Group’s
arrangements have been put in place.
control, under both the base
least 12 months from the date these
The Directors have taken into
financial statements are approved.
account the reorganisation of the
As part of the Group’s going concern
review, the Directors have assessed
the Group’s trading forecasts,
working capital requirements
and covenant compliance for the
foreseeable future under a base case
scenario, taking into account the
Group’s financial resources including
the current cash position and
banking and finance facilities which
are currently in place (see note 30
for details of these facilities).
Tricoya consortium and restructuring
of its bank debt completed in
November 2022 which resulted in
Accsys becoming the 100% owner
of the Tricoya Hull plant and the
commitment to fund ongoing working
capital during the hold period. The
Directors have also considered the
scenario and severe but plausible
downside scenario, there is
sufficient liquidity and covenant
headroom such that there is no
material uncertainty with respect
to going concern and have
prepared the financial statements
on this basis.
Steven Salo
Chief Financial Officer
possible amount and timing of capital
26 June 2023
expenditure required to complete
the Accoya plant in the USA, noting
that notwithstanding that the
construction project benefits from
The Directors have also assessed
certain contractual measures in place
a severe but plausible downside
with the lead construction contractor,
scenario with reduced sales volumes
Accsys has committed to fund its
and lower gross margin, also
60% share of cost overruns, should
reflecting the possible impact of
they arise.
volatile raw material costs.
The Directors believe there are a
These forecasts indicate that in order
sufficient number of alternative
to continue as a going concern the
actions and measures within the
Group is dependent on achieving
control of the Group that can and
certain operating performance
would be taken in order to ensure
measures relating to the production
on-going liquidity including reducing/
and sales of Accoya wood from the
deferring costs in some discretionary
plant in Arnhem with the collection
areas as well as larger capital projects
of on-going working capital items in
if necessary.
line with internally agreed budgets.
Accoya cladding, Villa Harmony, Ibiza, Balearic Islands, Spain
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 50
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Risk Management
HOW WE IDENTIFY,
EVALUATE AND
MITIGATE RISKS
Global companies continue to
The current Chair of the Audit
New and emerging risks
Our risk management
framework incorporates
a top-down approach,
setting the risk appetite
and identifying our principal
risks, together with a
bottom-up approach to
identify our operational risks:
Accsys’ Risk Committee remains alert
to the presence of new or emerging
risks to the business, as well as to any
changes in the status or prevalence
of existing risks to the business.
Emerging risks identified during
the past year can be found in the
following tables and marked as ‘New’
All employees have a role
in the management of risk
within the Group.
H
S
E
Review of
operational
controls
Accsys also has an executive-led Risk
in the ‘Risk trend’ column.
51
C o l l eagues
Group
Controls
a m
e
ershi p T
une r a
m
e
R
d
a
e
L
r
o
i
n
e
S
t
i o n
No
m
i
n
Board of
Directors
a
t
i
o
n
S
e
n
i
o
r
L
e
a
d
ership T
A u dit
e
am
Colleagu e s
Risk culture
As part of Accsys’ commitment to
good risk management practices,
it is focused on developing cultural
awareness of risk and embedding
good risk management practices
at all levels of the organisation.
Company initiatives that reinforce
risk culture include a requirement for
employees to complete training on
certain risk topics and the employee
annual appraisal process requires
managers to check completion of
the training by the employees. These
training modules cover:
• Data management;
• Anti-corruption;
• Market abuse; and
• Anti-slavery.
A summary of the principal risks facing the Group is set out below. The below is subject to ongoing review and
change. The risks should not be read in any order of priority. The ‘Risk trend’ column indicates the risk trend
in the reporting period compared to the last Annual Report and, where appropriate, commentary has been provided
on risk trend changes.
Risk
Description
Mitigation
Risk
trend
Finance
A lack of strong financial control and planning
may adversely impact the Group, both in
respect of its short-term requirements, as well
as enabling it to complete key capital projects.
Given the Group’s size relative to the scale
of capital-intensive projects necessary for it
to meet its growth strategy, the Group may
be adversely affected by cost overruns on
those projects. Further, if additional capital
is required to fund cost shortfalls, such
additional capital may not always be readily
available, or if it is, the cost of capital may be
relatively higher.
Relevant members of the Senior Leadership
Team, with oversight from the Finance team,
are tasked with ensuring sufficient planning and
management of demand creation, raw material
inventory management and operational production
to maximise working capital efficiency and cash
generation.
Accsys has appropriate measures in place to monitor
and control operational and capital expenditure.
During FY23, Accsys took a number of steps to
improve its FP&A capability and, in FY24, it plans
to commence an upgrade programme of its
ERP platform to further develop its control and
planning systems. The Accsys Board also held
additional meetings throughout the year to ensure
an appropriate level of focus on the Company’s
financial position.
face significant headwinds, and
Committee is Sean Christie. Sean
identifying, evaluating, managing and
understands business and financial
mitigating risk remains an essential
risk and related controls and
corporate activity.
Risk governance
At Accsys, the Board is ultimately
responsible for risk management.
Ongoing risk assessment is delegated
to the Audit Committee which seeks
to ensure that Accsys’ risk processes
remain focused and robust.
The Audit Committee’s terms
of reference ensure it has the
capability and structure to operate
independently of the Accsys
executive team, specifically:
• the Committee is required to
have a particular focus on Accsys’
processes for the management of
business and financial risk;
• Committee members should
have the ability to understand
control processes through being an
experienced audit committee chair
and a long executive career which
included group finance director roles
at large multinational organisations.
Committee which reports to the Audit
Committee on risk management within
Accsys’ business and operations.
Accsys’ Risk Committee meets at least
quarterly and is comprised of several
members of the Senior Leadership
Team. The Risk Committee conducts
regular and structured reviews of risk,
which it then reports to, and further
reviews and discusses with, the Audit
Committee. The Audit Committee then
seeks to ensure that risks have been
suitably identified and evaluated with
appropriate mitigation plans in place.
key business and financial risks
The Risk Committee maintains a
and related controls and control
detailed risk register and seeks to:
processes;
• the Committee is entitled to obtain,
at Accsys’ expense, independent
legal, accounting or other
professional advice on any matter it
believes is necessary to do so; and
• at least one member of the
Committee should be literate in
business and financial reporting
and control and have past
experience in finance or accounting
or other comparable experience
or background.
• identify and rank key risk areas,
including existing and new risks;
• allocate a Senior Leadership Team
member with day to day oversight
of each risk;
• evaluate the likelihood and impact
of each risk;
• highlight to the Audit Committee
changes in the risk register;
• identify steps that are being taken
to mitigate the risk; and
• traffic light those areas of
particular concern.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
52
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Risk Management continued
53
Risk
Description
Mitigation
Risk
trend
Risk
Description
Mitigation
Risk
trend
Health,
Safety and
Environment
The Group’s manufacturing business and
operation of industrial plants involve the use of
both raw wood and certain chemicals, where
there is a risk of health, safety or environmental
(HSE) incidents at our sites such as injury,
damage, explosion, contamination, or death.
These represent ongoing risks with potentially
catastrophic impact.
Where Accsys is involved in constructing new
plants, there is also HSE risk present in the
nature of construction activities.
The Group maintains and continues to invest in HSE
processes and systems internally. Our aim is also
to continually increase HSE awareness among our
people. In February 2023, the Group held a Health
and Safety Month, providing additional training
and activities on health and safety. The benefit of
the focus in FY23 on safety awareness continues
to be seen, with all employees understanding their
important role to play in their own safety and the
safety of others.
Accsys’ Group HSE Director is responsible for
implementing and (where necessary) improving HSE
matters across the Group. The Group HSE Director
is supported by dedicated full-time HSE managers at
our operational sites and reports frequently to the
Senior Leadership Team.
The HSE Committee also plays an important role in
reviewing and assessing HSE matters to ensure the
Group’s HSE approach and strategy are appropriate
depending on the risk profile. During FY23, the
Board approved a change in the HSE Committee’s
terms of reference to ensure a strong emphasis
on oversight of management and operational
HSE activities.
Hull Plant
Failing to conclude the construction of
the new Tricoya plant in Hull, including its
commissioning and start-up, in a timely
manner, or at all, may affect the Group’s ability
to generate revenue or develop its Tricoya
business as planned.
Finalising the verification of cost to complete Hull
and the evaluation of funding options remains a key
priority for the Senior Leadership Team and the
Board. It is a priority for the Board that any course
of action taken in respect of Hull does not have an
adverse financial impact on Accsys.
It is possible that Accsys may not be able
to obtain funding at an acceptable and/or
necessary level and cost relative to the project
requirements.
Whilst a decision on Hull is pending, the Senior
Leadership Team ensures that maintenance costs at
the plant remain within the Board’s expectations and
are funded by internally generated cash flow.
Kingsport
Plant
The construction of the new Accoya plant
in Kingsport, Tennessee, including its
commissioning and start-up, may affect the
Group’s ability to generate revenue as planned
if the commencement of the commercial
operation of the plant is materially delayed
and/or costs materially more than budgeted.
The joint Accsys and Eastman Chemical Company
team is intensively and continually reviewing the
progress of the project. They have appointed
experienced project and construction managers to
monitor progress to ensure that the plant proceeds
to commercial production materially on time and
within budget.
NEW
Licensing/
Partnering and
Protection of
Intellectual
Property
Market and
Supply Chain
Disruption
A loss of demand for technology licences
or interest in partnering with us for new or
existing plants may adversely impact our ability
to realise value from our IP and grow in line
with our strategy.
Similarly, a failure of our existing business
partners, including contractors, licensees,
and suppliers to perform as expected under
our agreements could adversely impact our
financial performance.
In addition, as a business which materially
benefits from IP, the loss of confidential
information, patent rights, trademarks and
other intellectual property is a key risk. A
failure to maintain and grow its portfolio of
IP, by patenting new inventions, acquisition
or by prevailing in any IP litigation may have
a material adverse impact on the Group.
Together these risks could weaken the Group’s
competitive advantage in its Tricoya and
Accoya businesses.
Planned and/or unplanned macroeconomic
effects and/or specific market dislocations
may cause direct and indirect impacts on the
price and/or availability of natural gas, raw
materials and logistics. Given the relatively
high proportion of input cost attributable
to acetic anhydride and raw wood, material
disruption in these markets may adversely
impact Accsys’ business.
Commentary on risk trend: During the year,
risk factors increased due to a number of
macro events, including asymmetry between
acetic anhydride and acetic acid markets
and continued strain on logistics providers.
Manufacturing
The Group’s ability to generate revenue
and progress EBITDA relies heavily on its
manufacturing capability. Manufacturing
capability may be materially and adversely
impacted by operational issues, including
inadequate and/or insufficient preventative
maintenance, engineering capability,
equipment performance, activity planning,
and site level procurement practice.
Developing strong relationships with current and
future business partners to embed a pipeline of new
business opportunities and foster key relationships
is an important focus of Accsys’ dedicated Business
Development team. Accsys’ Sales, Marketing and
Licensee Support teams will also work with these
partners to help them to grow their Accoya or
Tricoya businesses.
Accsys has dedicated resource to manage its IP
which, together with external IP attorneys, are
responsible for maintaining and developing the
Group’s IP portfolio. Accsys uses confidentiality
and IP agreements when dealing with its business
partners. To mitigate risk in relation to IP protection,
training is given to employees to help ensure
awareness of the need to protect our IP.
Building long-term relationships with key suppliers
of raw materials, including new and existing suppliers
of acetic anhydride, continues to be of paramount
importance to Accsys. Maintaining a diversity
of supply is key, as is ensuring good supplier
relationships that provide Accsys with materials on
time, in line with its expectations.
In managing the supply chain for raw wood sourcing,
risk is mitigated through a number of supplier
screening, selection and monitoring steps and
processes. It is also a requirement that Accsys’ wood
suppliers are FSC certified. Further information on
Accsys’ approach to supply chain risk management
and biodiversity can be found on the Sustainability
and ESG section of the Accsys corporate website.
The Group has continued testing new species of
raw wood from different geographic regions which
would be suitable for application in respect of both
Accoya and Tricoya. The Group also continued
to build up resilience in its supply chain through
further contractually binding arrangements with
raw material suppliers.
During FY23, Accsys commissioned and brought
into commercial production Reactor 4 at its Arnhem
facility, providing a material increase in capacity at
the plant. At Arnhem, Accsys has also implemented
a range of activities to mitigate manufacturing risk
and drive resilient profitability at the site, including
hiring an experienced Head of Manufacturing
and Operations, enhancing equipment reliability
plans and looking to continuously improve the
performance of site mechanical stacking and
de-stacking capability.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 54
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Risk Management continued
Risk
Description
Mitigation
Risk
trend
Talent
The potential inability to source or attract a
sufficient number of capable people, retain
sufficient numbers of people (including
adequate engagement and enablement) and
ineffective performance management and
leadership of Accsys’ people, could, if not
mitigated, have a material adverse effect
on Accsys’ ability to deliver its strategy.
Sale of
Products
Environmental,
Social and
Governance
(ESG) and
Sustainability
Accsys relies on high levels of demand for its
premium products, driven principally by the
unique qualities and sustainability credentials
that Accoya and Tricoya deliver. A key risk
for Accsys is that changes in demand may
arise out of macroeconomic events beyond
the Group’s control which may affect end-
consumers’ appetite to purchase premium
products, together with changes in building
material trends and/or increased competitive
offerings increasing the relative substitutability
of Accsys’ products.
Commentary on risk trend: During the year,
inflationary headwinds have built momentum
globally, which if sustained for an extended
period, would be an increased risk factor.
Through its products, Accsys offers the world
a choice to build more sustainably, and ESG
goes to the heart of what the Group does. An
inability to recognise ESG issues and mitigate
ESG risks may be materially detrimental to the
Group’s prospects as a company with strong
ESG credentials. In addition, failing to achieve
crucial environmental product credentials,
such as Cradle to Cradle® certification, could
adversely impact Accsys’ position in the market
as a supplier of superior sustainable materials.
The Group maintains an ability to attract and
retain skilled people through various processes
and policies under the leadership of the Group’s
HR function. In addition, Accsys values and invests
in colleague engagement and communication to
maintain a positive and motivated culture. The
Group made further progress in FY23 with respect
to appointments in a number of key roles.
Detailed reviews of functional requirements aim to
ensure that the Group can appropriately resource
its organisational needs at a time of rapid growth.
Evaluations are carried out to identify those
functions that are of critical importance for the
Group and individuals within those functions that are
themselves critical and/or are considered of high
potential. Accsys also operates a Group-wide bonus
scheme, together with a long-term incentivisation
plan which seeks to reward, incentivise, motivate,
attract, and retain critical personnel by way of
share-based awards with deferred vesting.
The Group maintains structured Sales, Marketing
and Product Quality functions which focus on
supporting and growing our sales and customer
demand, while ensuring the quality of our products.
Research and development continues, with the goal of
increasing overall product quality by way of enhancing
quality control standards and carrying out root
cause analysis.
The Group has seen strong demand for Accoya
Color, particularly in the USA, and it continues to
seek to develop this demand globally.
Accsys has a robust approach to ESG governance
in key ESG areas including health and safety, people
and wellbeing, ensuring fair and ethical conduct,
producing and selling products that are sustainable
and sourced responsibly, controlling Accsys’ impact
on the environment, and seeking to benefit the
broader society and communities around Accsys.
The Board engages with the Senior Leadership
Team in setting meaningful sustainability targets.
During FY23, Accsys continually focused on ensuring
awareness of upcoming legislation and took steps
to comply with frameworks such as TCFD and
disclosures such as GRI and SASB.
The Group is planning to apply for apply for
Cradle to Cradle® recertification in FY24 and
made progress in FY23 towards ensuring that this
is achieved.
55
Description
Mitigation
Risk
trend
Risk
IT
As a company with valuable technological
IP and with manufacturing processes that
depend on IT systems, a failure of IT security,
continuity or inadequate management
information may have a serious impact on the
Group’s business.
Risks relating to IT and cybersecurity are
considered by the Audit Committee as part of
its regular review of the Group’s Risk Register.
Commentary on risk trend: The increased
prevalence observed globally of ransomware
and similar cybersecurity risks, has become an
additional risk factor.
Governance,
Compliance
and Law
A failure to maintain appropriate governance
structures or a lack of a clear business
strategy may lead to poor decision making and
operational performance. It may also increase
the risk of the Group failing to meet or stay
compliant with applicable laws and regulations.
Accsys maintains a high level of IT security through
the adoption of a continuous improvement in
enterprise information and data security process,
and policy compliance. Physical device and systems
security software and industry-leading security
platforms have been implemented to monitor and
manage the continually-evolving threat landscape.
Accsys continues to develop and implement
processes and procedures to support its ongoing
operational security, in particular towards the
strategic objective of achieving ISO 27001
compliance. Approximately 90% of the Group’s
IT environment is service based/cloud hosted,
and supported by organisations which are ISO
27001 certified.
Accsys conducts third-party vulnerability scanning
and analysis including simulated hacker attacks,
and has IT business continuity plans in place with
disaster recovery and incident response testing
held annually.
Accsys has adopted the QCA Corporate
Governance Code and reports against it on a comply
or explain basis. In addition to the disclosures set
out in this Report and Accounts, Accsys’ current
Statement of Compliance relating to the QCA Code
explains how Accsys complies with the Code and,
in turn, mitigates risk. A copy of Accsys’ current
QCA Compliance Statement can be found at
www.accsysplc.com/qca-compliance.
Accsys also has dedicated legal and governance
resource, headed by the General Counsel and
Company Secretary, who is responsible for the
Group’s legal and Company secretarial affairs.
Accsys regularly monitors legal and regulatory
matters at a Group and business level, consulting
with specialist advisers as necessary.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 56 | Accsys Technologies PLC | Annual Report and Financial Statements 2023
Sustainability
OUR APPROACH TO
SUSTAINABILITY
At Accsys we are committed to our purpose of
Changing Wood to Change the World
2023 highlights
CLIMATE CHANGE
Reporting Scope 3 emissions for the first
time and continuing to report Scope 1 and 2
emissions
RESPONSIBLE SOURCING
100% of Accoya from FSC® (CO12330)
certified sources
GOVERNANCE
13% year-on-year improvement in S&P Global
Corporate Sustainability Assessment
Task Force on Climate-related Financial
Disclosure (TCFD framework) action plan
developed
SUSTAINABLE & QUALITY PRODUCTS
Accoya Color Grey Cradle to Cradle
Certified® (Gold)
HEALTH AND SAFETY
Continued commitment to Zero
Harm culture
57
The Accsys Environmental Social Governance
(ESG) Framework is the foundation of our
approach to sustainability.
It comprises Accsys’ 10 material issues that are aligned to the United Nations Sustainable
Development Goals. The framework is also guided by internationally recognised ESG reporting
frameworks such as CSA (S&P), GRI and SASB.
Supported at the Accsys Board level, and with ESG targets integrated into our Executive
remuneration, our approach to these issues is a core part of both our purpose of ‘changing
wood to change the world’ and our integrated business and growth strategy.
Progress on sustainability strategy
Over the last year, we have entered Stage 2 of our
sustainability strategy roadmap, which focuses on
impactful action and data-led direction. We have
continued to dedicate resources with the aim of
delivering best-in-class ESG reporting for our
shareholders and demonstrating ESG leadership
in our industry.
Looking ahead
We are now focusing on using the data we have been
collecting to start setting realistic, ambitious, and
attainable targets based on the Science Based Targets
Our goals for FY24 include:
initiative (SBTi) to reduce our carbon intensity. We
• Setting science-based carbon intensity
are streamlining how we collect our data as the
reduction targets whilst considering our
business expands to ensure the right processes are
business’s growth trajectory;
implemented from the beginning of new projects.
Over the following pages we highlight our key
developments on the material issues pertaining
to our ESG framework.
• Continuing to ensure our products
are recognised as best-in-class for
sustainability through third party
accreditations;
• Implementing our action plan for the
TCFD framework;
• Promoting our products as alternatives
to carbon intensive man-made materials;
• Developing our corporate governance
through implementing new policies on
human rights and other key ethics areas; and
• Further improvement of our S&P
CSA score.
More information and detail is also available in our SASB and
GRI Content Index | www.accsysplc.com/esg-reporting
and queries can be directed to | sustainability@accsysplc.com
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Sustainability continued
Over the following pages we describe our approach, key highlights and metrics on each aspect of ESG as well
59
as next steps for FY24.
Our ESG Framework
People &
wellbeing
Health
& safety
Innovation &
technology
Fair &
ethical
conduct
Society &
communities
Governance
management
& advocacy
a
h
W
t w e d o as a busin
e
s
s
Changing
wood…
Sustainable
& quality
products
…to change
the world
H
o
w we make a n i m p
a ct
Responsible
sourcing
Ecological
footprint
Energy &
climate change
Our contribution to the
United Nations Sustainable
Development Goals (SDGs)
Our main contributions focus on
SDGs 9, 11, 12, 13 and 15, as these
areas are where our business can
have the most meaningful impacts.
Aside from these targeted
areas, the strong sustainability
performance of our business
and product also align with
a broader group of SDGs.
Our focus on TCFD
The Task Force on Climate-
related Financial Disclosures
(TCFD) provides a framework
for companies to disclose
climate-related financial risks and
opportunities in their operations,
governance, and strategies.
At Accsys, we are committed
to following best practices in
sustainability governance and
reporting, going above and beyond
regulatory obligations. As part of
this we have conducted an initial
review of the TCFD. In FY24, we will
focus on key actions which Accsys
is able to implement related to
the TCFD recommendations, as
we understand the importance of
evolving our approach to climate
risk and resilience.
In the coming years, Accsys will do the following to
implement the TCFD recommendations:
1.
Conduct a climate risk assessment: analysis of how physical,
transition, and liability risks from climate change across
different temperature scenarios may affect our business
operations, supply chains, assets, and financial performance;
2.
Integrate climate risks and opportunities into strategy and
governance: we will incorporate climate considerations into
our decision-making processes and risk management systems;
3.
Set climate-related targets and metrics: we are in the
process of establishing measurable science-based metrics to
support targets on our greenhouse gas emissions, increase
our energy efficiency and adapt to climate risks;
4.
Disclose climate-related information: we will look to report
our climate-related risks, opportunities, and impacts in a way
that is aligned with the TCFD's recommended disclosures;
5.
Engage with stakeholders: we will engage with investors,
customers, colleagues, and other key internal and external
stakeholders on climate-related issues; and
6.
Monitor and improve: we will monitor and review these
climate-related disclosures, targets, and performance and
ensure our approach remains aligned with developing practice.
Sustainability strategy roadmap
We are on track with our sustainability strategy roadmap. This year we have further developed our approach,
processes and action plans for our material issues, with particular focus on improving measurement,
monitoring, reporting and management of performance.
Stage 1:
Evaluation and
strategy refinement
Stage 2:
Impactful action
and data-led direction
2022
2023
5+ years
• Improve assessment, monitoring and
data management
• Review and, where necessary, set up new
formal policies, oversight and workflows
• Initial actions for improvement in each
material issue
• Establish baseline statistics and metrics
• Use improved data to refine action
plans & set realistic, ambitious and
attainable targets
• Implement and support new
programmes and initiatives
• Manage and reassess material
issues and stakeholder priorities
to ensure continued relevance
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 60
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Sustainability continued
61
ENVIRONMENT
CASE STUDY
ENVIRONMENT
CASE STUDY
Environment
The environment is at the core of our business. Our product
enables the world to build more sustainably, and we are
committed to producing it in the most responsible and
circular way.
We continue to innovate to minimise our environmental
impact across our operations, in accordance with our
Climate Change policy, whilst sourcing our raw materials
responsibly. We work collaboratively with our suppliers
and forge new partnerships to ensure the secure supply
of sustainable materials.
Our products continue to meet the highest standards
of quality and sustainability by achieving third party
accreditations and certifications – while always meeting our
customers’ needs. We publish our Environmental Product
Declarations (EPDs) on Accoya.com.
50,827 tCO2
sequestered in products sold (FY22: 47,838 tCO2)*
Zero waste to landfill (FY22: 0)
100% certified sustainable (i.e. FSC® (CO12330) wood
sources (FY22: 100%)
60 tonnes reclaimed Accoya wood re-processed for
Tricoya (FY22: 134 tonnes)
100% suppliers screened using social and
environmental criteria (FY22: 100%)
100% of new supplier wood mills visited before supply
(2021: 100%) and 81% of wood supply mills visited
within three years (FY22: 85%)
100% of operations subject to human rights reviews
or impact assessments (FY22: 100%)
0.11 tCO2e/m3 Scope 1 & 2 emissions intensity
(FY22: 0.09 tCO2e/m3) see Greenhouse Gas Emissions
information on page 62 for more information.
* These figures are unaudited
FY23 highlights
• Increased renewable electricity usage as a proportion of
total electricity: renewables now 63% of the overall mix,
including RECs (FY22: 39%)
• Continuing to research new wood sources and locations:
positive results from long-term trials of Accoya made from
fast growing Taeda pine from Argentina and Uruguay
• Steering group for carbon reduction intensity:
established an internal committee (SteerCo) to focus on
carbon intensity reduction
• Cradle to Cradle Certified®: in May 2022, Accoya Color was
Cradle to Cradle Certified® at the prestigious ‘Gold’ level
•
Enhancing production circularity: embracing new
technologies for closed loop acetic acid recycling and
continuing to develop our offcuts reclamation programme
• Minimising impacts of raw materials sourcing: refreshed
Lifecycle Analysis (LCA) of all existing and potential acetic
anhydride supply options to guide future sourcing decisions
Looking forward
• Maintain 100% certified sustainable wood sources in FY24
• Set Science Based Targets for reducing our carbon intensity
• Increase in-person wood mill supplier engagement
• Continue to maximise the use of raw materials and reduce
the impact of our supply chain through:
– Expanding the use of lower grade woods for our
engineered wood products to maximise the use of forest
resources
– Continuing to explore the use of other suitable wood
species, source locations and supply options for more
sustainable and lower impact wood sourcing
– Ongoing evaluation of acetic anhydride supply sourcing,
reuse and recycling of acetic acid
co-product
• Conduct feasibility study of using biomass at Barry, UK
• Increase annual volume (m3) of Accoya offcut reclamation
being remanufactured for Tricoya
Cradle to Cradle
Certified® –
demonstrating
performance and
sustainability go
hand in hand
At Accsys, we are proud that our products are high
performing, while contributing to a more sustainable
built environment. Externally assessed accreditations and
certifications allow us to demonstrate our sustainability
attributes and ensure that we are progressing and focusing
on the right areas.
Cradle to Cradle Certified® (C2C) is an independent
global standard for products that are safe, circular and
responsibly made. It helps companies ensure the impact of
their products on people and the planet is a positive one.
Companies must reapply for C2C status every two years.
Accoya has held Gold C2C Certified® status, since 2010,
highlighting the company’s impressive sustainable wood
sourcing strategy, non-toxic product and use of more than
50% renewable energy in production. The separate Platinum
certification in the Material Health category recognises that
the product poses no danger to either the environment or
human health, and is the highest possible certification level.
In May 2022, Accoya Color was Cradle to Cradle Certified®
at the prestigious ‘Gold’ level. It also achieved ‘Platinum’
(the highest level) for both ‘Material Health’ and ‘Water
Stewardship’. This recognises that Accoya Color as a product
adheres to very high standards of sustainability, alongside
it’s recognised high performance and durability credentials.
Maximising nature’s
resources
Wood is the natural ingredient for our product. We
are very conscious of making sure that the wood we
use is replenished and we only take supply from FSC®
(CO12330) certified sources (or equivalent). While trees
are a renewable resource, we are careful to use them
responsibly and maximise the use of the resources we
take. This benefits the environment as well as making
good business sense.
In 2021, we started a programme to take back Accoya
wood trimmings from some of our trusted manufacturing
partners and using them to manufacture Tricoya wood
chips. This involves reclaiming these trimmings and
putting them through a rigorous quality control process,
including inspections by our trained operators, to ensure
that all the material meets the quality required for Tricoya
chips. The Accoya offcuts are already acetylated, making
it a highly efficient process to create Tricoya chips
directly from them – and minimising waste. Since we
started, we have reclaimed 683m3 of Accoya offcuts for
use to make Tricoya wood chips.
Although our offcuts and reuse programme is still in its
early stages, our goal is to develop it further over time
and open it up to more and more of our customers – and
potentially their customers too. This not only keeps the
carbon locked into our materials for longer, but also
enhances value, reduces waste, and further embeds
our sustainable and circular economy philosophy.
Accsys Technologies is participating in Timber
Development UK’s (TDUK) Responsible
Purchasing Policy (RPP) which includes, where
applicable, gathering and reporting of annual
import/purchasing data, conducting and
continuously improving Due Diligence
in line with the UK and/or EU Timber
Regulation (UKTR/EUTR) or submitting
an annual declaration of no imports.
ResponsiblePurchaserTimber Development UKbuilding a better world with woodFINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
63
Scope 1, 2 & 3 Emissions Methodology
• We have reported on emission
• Emissions have been calculated
Our net market-based figure takes
sources required under the
following the GHG Protocol
into account RECs and offsets
Companies Act 2006 (Strategic
– Corporate Accounting and
retired in the reporting year.
Report and Directors’ Reports)
Reporting (revised edition) using
Regulations 2013 and the
the following databases: IPCC
Streamlined Energy and Carbon
2006 Guidelines for National
Reporting requirements.
Greenhouse Gas Inventories, 2007
• We report on all existing
sites where we have active
operations, this includes our
manufacturing facility in Arnhem,
the Netherlands, our Accoya Color
IPCC Fourth Assessment Report;
and IEA factors (2022). We also
use the UK Government GHG
Conversion Factors for Company
Reporting (2022).
facility in Barry, UK, our Dallas
• Following the Environmental
office, our Tricoya site which is
reporting guidelines: including
under construction in Hull and
Streamlined Energy and Carbon
our London office. Our energy
Reporting requirements’(BEIS,
consumption at our Kingsport
DEFRA 2019), carbon offsets
site is currently below the
may be accounted for separately
reporting thresholds.
as a ‘NET’ figure, while the
• Scope 2 emissions are reported
in both location-based and
market-based approaches to
take into account the purchase
of Renewable Energy Certificates
(RECs), a market-based instrument.
• We have purchased 2,834 tCO2e
of carbon credits to offset a
proportion of our GHG emissions.
The credits are Voluntary
Emissions reductions from
the Verified Carbon Standard
(VCS) and Climate, Community
& Biodiversity Standards (CCB)
through EcoAct’s portfolio.
original electricity consumption
figures should be presented as
a ‘GROSS’ figure.
Sustainability continued
Greenhouse Gas Emissions
Scope 1 & 2
Scope 1: direct emissions from company owned or controlled sources; Scope 2: indirect emissions
from the generation of purchased energy, such as electricity.
5,479
tCO2e SCOPE 1 EMISSIONS
(FY22: 4,715)
1,547
tCO2e SCOPE 2 EMISSIONS MARKET-BASED
(FY22: 680), 4,783 tco2e RECs retired (FY22: 7,502)
Scope 1 & 2 Greenhouse gas (GHG) emissions information
Scope 1 emissions
Scope 2 emissions location-based
Scope 2 emissions market-based
Total scope 1 and 2 emissions market-based
Carbon offsets purchased
Renewable Energy Certifications (RECs)**
Scope 1 and 2 emissions (net value)
Accoya wood product produced
tco2e
tco2e
tco2e
tco2e
tco2e
tco2e
tco2e
m3
Net Scope 1 and Scope 2 emissions intensity per wood product produced
Energy consumption associated with Scope 1 and 2 emissions
tco2e/m3*
MWh
* The 2022 figures have been updated following improvements in our methodology.
** We retired renewable energy certificates to green our consumption.
We use market-based emissions to calculate our GHG inventory. These figures are not subject to assurance or audit.
FY23 Total
FY22* Total
5,479
3,238
1,547
7,027
2,843
4,783
4,184
63,344
0.11
40,296
4,715
2,817
680
5,395
3,910
7,502
1,485
59,649
0.09
34,603
Changes to previous year
Our Scope 1 and 2 emissions saw a year-on-year increase. This can be attributed to increased engineering activity
during the expansion of our Arnhem site and the subsequent increased production and natural gas use. Additionally,
we use Renewable Energy Certificates (RECs) to reduce our climate impact at our manufacturing sites and we retired
considerably fewer RECs in FY23 than FY22.
Scope 3 emissions reporting
• At Accsys we have long focused on credible assessments on our environmental impact. We have conducted product
life cycle assessment of Accoya wood for 20 years.
• This year we built on our progress and have conducted Scope 3 emissions internal reporting. These can be seen in
the ESG data table on the Accsys website.
• For the next steps, we will be assessing our impacts in more detail as we look towards developing our near to
longer-term commitments.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
65
Focus on:
Health and Safety
Building a Zero Harm culture
During the year, we introduced a digital version of our
Safety Observation Card (SOC) to make it easier for
colleagues to report and suggest safety improvements.
As a result we saw our SOCs increase to 1,316 which is a
significant increase on the prior year.
0 fatalities (FY22: 0)*
1.0 Lost Time Incident Rate (LTIR) (FY22: 0.5)**
1.04 Incident severity rate (FY22: 8.97)
Over the last 12 months, we have been focusing
on areas to continuously improve and enhance our
existing approach to health and safety.
During the whole of February 2023, we organised
a Health and Safety month, where we held various
694 Management Safety Tours (FY22: 741)***
events, including H&S training, AED demonstrations
1316 Safety Observation Cards submitted (FY22: 1060)
28 working days lost due to accidents (FY22: 8)
for all staff, PPE inspections and had numerous guest
speakers. We also used this event as a launchpad for
Life Saving Rules – several key safety rules to keep
colleagues safe when carrying out higher risk activities.
Our number one priority is ensuring all our colleagues
The event was a great success and a follow up
go home safely every day. We are embedding a health
questionnaire found that 89% of respondents valued
and safety culture throughout the organisation, with
the event, with 77% saying that it made them think
the ultimate aim of zero harm. This year, we have made
more about health and safety.
good progress on further building health and safety
into our working culture.
64
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Sustainability continued
SOCIAL
CASE STUDY
Social
At Accsys, we are committed to looking after our colleagues
and communities by operating in a safe and supportive
working environment. We seek to have a positive social impact
through a variety of activities aligned with our business
purpose of ‘Changing wood to change the world’.
As a manufacturing company, health and safety always comes
first. We will continue to practice health and safety excellence,
improve monitoring, raise awareness of our safety policies and
strategy, and embed the importance of health and safety in
our company culture. Our ambition is ultimately for zero harm.
We know the best results come from people who are engaged,
motivated and have opportunities to develop. We have an
extensive learning and development programme for all
colleagues and we also give our colleagues the opportunity to
participate in an employee share plan, enabling them to share
in the success of the Company.
78%
bi-annual colleague engagement survey response rate
0 incidents of discrimination (FY22: 0)
22% colleagues invested in the FY23 Employee Share
Plan (FY22: 36%)
34 total hours of training and development per person
(FY22: 29)
88% “I feel able to be myself at work” survey response
€72,219 donated to charitable activities (FY22: €20,875)
Non-Executive Board Members
Senior managers*
All employees
Note: Table reflects FY23
% Male
% Female
71
80
84
29
20
16
*
Senior managers include our Executive Board Members, Senior Leadership Team,
and senior managers with highest levels of strategic influence for the organisation.
Beyond Accsys:
ESG in our supply chain
Our suppliers are a critical part of our ESG strategy and
we are committed to working with suppliers who share
our values as well as meeting our quality requirements and
standards. We have been working to broaden our wood
supply, looking for alternative wood sourcing locations
and species. Working with our wood supplier CMPC, we
identified a mill in a rural area of North-Eastern Argentina
that had the potential to meet our requirements. However,
this mill was not currently FSC® certified and needed some
quality improvements.
Working in close collaboration with the Product
Development team at CMPC, we explained to the mill how
they could benefit from FSC® certification. We then worked
with CMPC to help the mill reach the quality necessary to
become an Accsys supplier and to support them on the
FSC® certification process. The mill now expects to be
certified later this year. At this point we plan to appoint them
as a supplier.
By becoming FSC® certified the mill will not only improve
ESG practices, it will also be able to command a higher
price for its product and benefit from increased market
opportunities. This, in turn, will enable additional and better
paid jobs to be created in an economically depressed area.
A win-win for the mill and the local community!
FY23 highlights
• Increased focus on HSE awareness, including the first
Accsys Health and Safety Month in February 23
Looking forward
• Launching the Life Saving Rules programme to enhance
health and safety around certain higher risk activities
• Launch of Digital Safety Observation cards to make it
• Assessing opportunities for continuous improvement in
easier and quicker to report safety issues
health and safety across the sites we control
• Continued commitment to Learning and Development:
including the launch of the ‘Accsys Leadership Club’ to
develop future leaders from within
• Diversity and Inclusion: Establishment of an internal
working group focusing on developing and implementing
a Diversity and Inclusion policy
• Volunteering day: Engaging colleagues and supporting
the community through a tree planting day with our
charity partner, Trees For All
• Support delivered to communities through monetary
donations and charitable product donations
(with screening criteria through the Charity Committee)
• Further development of our global HSE systems, including
systems development for Hull and Kingsport
• Focus on reducing lost time incidents to meet our target
0.5 LTIR**
• Create an online learning and development system to
facilitate training
** Per 200,000 hours worked
*** With the completion of reactor 4 and stacker projects at Arnhem and the hold position for Hull we are currently working significantly fewer hours.
*
The below are all employee related metrics. Contractor related metrics can also be found in the ESG section of our corporate website.
** Per 200,000 hours worked.
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67
Sustainability continued
Stakeholder Engagement
GOVERNANCE
CASE STUDY
Embedding quality
into everything we do
In February 2022, Accsys’ Arnhem site was granted ISO 9001
accreditation. This certification has been awarded for the
first time in Accsys’ history.
ISO 9001 is an internationally recognised accreditation
for quality management. It acts as a strong indicator
that a business is well-run and credible, helping ensure
partnerships are secure, risk is minimised and customer
satisfaction is the best it can be.
ISO 9001 certification is not an obligation – it’s a choice.
And by choosing to be accredited we are demonstrating
our commitment to organisational excellence.
Our journey towards ISO 9001 accreditation began in
mid-2020. Over the past two years a tremendous level of
effort and teamwork has gone into the granting of this
accreditation, from introducing new systems and internal
auditing processes, to training and educating colleagues on
the ISO 9001 principles and support methodologies.
As well as giving customers and external partners
confidence in our business, the certification will benefit
colleagues through ensuring we have clearly defined and well
managed processes.
As part of our ongoing commitment to ISO 9001, our quality
management system will now be subject to an external audit
at least once a year.
Looking forward
• TCFD (Task Force on Climate-related Financial Disclosures)
implementation commencement
• Continuous improvement of Board focus on ESG
• Monitoring new mandatory reporting frameworks e.g.
EU Taxonomy
• ISO 45001 and ISO 14001 certification action
plan developed
• Further improvement to data management processes
Governance
We strive for first-class governance, management and
stakeholder relationships to sustain our growing scale.
We will uphold our commitment to high ethical standards,
ensuring our processes and procedures are strengthened
as we continue to grow.
0 incidents
of bribery and corruption (FY22: 0 incidents)
1 fine* and 0 non-monetary sanctions from
non-compliance with environmental laws and/or
regulations (FY22: 0)
0 incidents of bribery and corruption (FY22: 0 incidents)
3rd annual GRI and SASB reporting disclosure
1 ’meet the Board’ event held for Accsys colleagues
100% relevant colleagues (including Board)
communicated with and completed refresher training
on anti-corruption policies and other key topics
(FY22: 100%)
€4,109 regulatory fines, sanctions or settlements
(FY22: €0)
€0 direct spend on political campaigns, lobbying or think
tanks (FY22: €0)
FY23 highlights
• Accsys scored 43/100 in the S&P Global Corporate
Sustainability Assessment - reflecting an improvement
of 5 points (+13%) over last year’s score of 38/100
• Continued adherence to QCA Corporate Governance Code
(see page 82 for more information)
• ISO 9001 Quality Management certification awarded to
Arnhem site
• Continuing to integrate ESG principles into procurement
practices
• Monitoring and training in relation to key governance topics,
including Anti-Bribery, Market Abuse and Modern Slavery
*
Related to a small chemical spillage. There was no significant health exposure.
Promoting the success of the Company for the
benefit of all its stakeholders
In discharging their duty this year, the Directors (both individually and collectively) confirm that during the year under
review, they acted to promote the long-term success of the Company for the benefit of its members as a whole, whilst
having due regard to the matters set out in Section 172(1)(a) to (f) of the Companies Act 2006 (‘Section 172(1)’).
The following symbols a
b
c
d
e
f refer to the Section 172(1) factors (a) to (f).
a
b
c
The likely consequences of any
The interests of the company’s
The need to foster the company’s
decision in the long term
employees
business relationships with
suppliers, customers and others
d
e
f
The impact of the company’s
The desirability of the company
The need to act fairly as between
operations on the community
maintaining a reputation for high
members of the company
and the environment
standards of business conduct
The Board is regularly updated
As part of their induction, all
The table on the following page,
on engagement and feedback
Directors are briefed on their
summarises the Group’s key
from Accsys’ broad spectrum of
statutory duties including Section
stakeholders and highlights the
stakeholders to enable it to consider
172(1) and can access professional
issues which matter the most to
such views during relevant decision-
advice on these – either through the
them. It goes on to further illustrate
making processes, taking into
Company or via external advisers.
how the Board engages with each
account the impact of decisions on
During the course of the year,
stakeholder group and ties in key
stakeholder groups.
key duties and other corporate
decision making against the Section
governance matters are reviewed
172(1) (a) to (f).
at Board meetings.
Listening, engaging
and partnering with
stakeholders across
our business activities
helps us to address our
business impacts and
improve outcomes for
people, health and safety,
and the environment.
Y A N D
N M E N T
N I T
V I R
O
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C O M
THE E N
SUPP
BUSIN
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E
S
S P
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R
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A
N
B
U
D
T
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O
O
R
N
S
,
S
U
M
E
R
S
Board of
Directors
SHAREHOLD E R S
A
A
R
N
T
D
N
E
R
S
S
E
E
Y
O
L
P
EM
See more about our business activities in our Business Model | Page 26
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
68
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Stakeholder Engagement continued
69
STAKEHOLDER GROUP
WHAT MATTERS TO THIS STAKEHOLDER GROUP
HOW THE BOARD ENGAGES
BOARD ACTIVITY AND KEY DECISIONS
STRATEGIC PRIORITY
The following symbols a
b
c
d
e
f refer to the Section 172(1) factors (a) to (f) on previous page.
Shareholders
• Financial performance of the business
• Annual general meetings
• Capital raising
• Operational performance of the
• Investor relations-led engagements
business
• Risk management
• Board composition and succession
• Long-term sustainable and
profitable growth
• ESG issues relating to climate change
• Strong governance
during the year
• The Board reviews and approves
communication that is circulated to
investors including trading updates,
Annual Report, RNS announcements
• Investor feedback following the
communication of the Company’s full
and half year results to investors
• Direct investor engagement
periodically
• Restructure of the Tricoya consortium
• Board restructure/Directorate changes
• Monitoring progress on key capital projects
a
b
c
d
e
f
• Build organisational capability
• Develop our technology
Suppliers and
business partners
• Terms and conditions
• Key account management
• Monitoring key supply chain metrics and decision making
• Grow product demand
• Modern slavery (in the supply chain)
• Data protection/GDPR
• Relationship management
• Business conduct and reliability
• Responsible sourcing
• Business performance
• Review and approval of the Modern Slavery statement and review of
supply chain and business partner risk identification and mitigation
• Consolidating relationships with joint venture partners and key suppliers
• Practice manufacturing excellence
a
b
c
d
e
f
Distributors, customers
• Product quality and performance
and consumers
• Level of customer service and
• Board monitoring of sales metrics and product quality
• Grow product demand
• Approval of the strategic expansion of Arnhem (reactor 4) to bring
• Practice manufacturing excellence
Employees
accountability
• Product availability
• Communication and regular dialogue
• Collaboration on sales and marketing
• Sustainability objectives
• Standards of business conduct
• Protection of data
• Health and safety
(and working conditions)
• The Company’s financial position
• Learning and development
opportunities
• Diversity and equality
• Pension scheme
• Impact of technology on the workforce
• Empowerment
• Having a stake in the business
more product to market and meet customer demand for more
product availability
• Approval of the enhancing customer and distributor engagement
programme and sales/marketing resources
• Approving initiatives such as the Approved Ambassadors Programme
• Approval of the Approved Manufacturers Programme and support for
promotional marketing activities
a
c
e
• Regular communication up-dates
in different forms, from in-person
meetings to video-conferences
and forums
• Employee feedback and questions are
also actively encouraged
• Ensures appropriate whistle-blowing
platform in place
• Directorate changes
• Build organisational capability
• Approval of the Employee Share Participation Plan
• Commitment to an all-employee learning and development programme
• Prioritising health and safety and commitment to building a zero
incident culture
a
b
c
d
e
Community and the
• Impact on the development,
• Climate change policy
• Commitment to ensuring our product continues to have a positive impact
• Practice manufacturing excellence
environment
performance and position of the
Company and the Company’s impact
on climate change
• How the Company assesses climate
change expertise
• Understanding of local community, the
communities in which it operates and
being a responsible employer
• Societies and Communities strategy
• Commitment to certification. (Accoya is Cradle to Cradle® certified
Gold, and Platinum for Material Health, recognising its circular
economy benefits)
• Commitment to sourcing 100% of our wood from FSC® (or PEFC)
certified sustainable and well managed sources.
• Embedding ESG into the Company’s incentivisation targets
a
b
d
e
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE
70
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Stakeholder Engagement continued
71
Long-term view
The Directors aim to ensure that the business and its
Statement of engagement with other
business relationships
Statement of engagement
with employees
values-led vision is not only a commercial success in the
Delivering our strategy requires strong relationships
The Directors recognise that our people are key to the
short-term, but also in the long-term. The evaluation
and alignment with suppliers, customers, distributors,
success of our business.
of long-term consequences of decisions involves the
licensees and business partners, as well as investors
Board managing responsibly as Accsys continues to
and other business relationships. The Company has
advance technologies and solutions for a better world.
developed a strong network of global distributors
The Directors hold a strong belief that the Company has
which has seen Accoya being sold into all continents
a collective social responsibility to use and develop its
of the world. Important relationships with suppliers in
technology to make the world a better, more sustainable
the wood and acetyls industries have been fostered
place. This belief, together with health and safety, remains
over more than a decade to mitigate risk and promote
a fundamental priority of the business.
success. Accsys provides training to its end-users (most
In order to assess the likely consequence of a decision in
the long term, the Directors focus on Accsys’ key values
and stated purpose: ‘Changing wood to change the world’,
to ensure that strategic aims provide long-term benefits
and success for the business and its stakeholders.
Good business conduct
Accsys is committed to a policy of minimising any negative
social and environmental impact that may flow from its
activities. Such expectations are clearly communicated,
for example, in the Accsys Sustainability Report, Anti-
Corruption, Bribery and Tax Evasion Policy, Modern
Slavery Statement and Accsys’ Whistleblowing Policy.
Accsys is committed to improving its practices for
combatting and eliminating slavery and human trafficking.
The Board periodically reviews and approves such policies
and statements (where relevant) to ensure that its high
standards are maintained both within the business and
by business partners, with training rolled out across the
Group to ensure understanding and compliance with
key principles.
frequently joineries) and distributors in relation to
Accoya, including information for usage applications,
manufacturing, environmental and social benefits.
Accsys also maintains frequent contact with and, when
possible, visits to customers to ensure regular and open
dialogue. The Company’s relationships with suppliers,
and with business partners such as Eastman Chemical
Company in relation to Accoya USA, are key elements
of the success of its business. These relationships and
ventures also create value for our partners, where the
new plants under construction will create new long-term
demand and supply opportunities for their businesses
where the sustainable nature of the finished products that
they contribute to also supports their own sustainable
development. We believe that our Accoya and Tricoya
products will serve a long-term role in replacing non-
renewable hardwoods and environmentally damaging
man-made products while crucially being able to offer all
of the attributes desired of a high-performance product.
To ensure strong and positive employee engagement,
Accsys holds regular communication updates in different
forms, from in-person meetings to video-conferences on
a wide range of topics, including: health and safety; the
Company’s financial position; strategy; and updates on
project progress and team activities. Employee feedback
and questions are also actively encouraged. These
communication forums combine a strong structure with
an informal environment to facilitate and promote real
engagement and open dialogue throughout all levels and
functions of the organisation.
The Company has an annual Employee Share Participation
Plan as an additional benefit of employment. This is open
to all employees, providing an opportunity to acquire an
ownership interest in shares and is intended to engage,
retain and motivate colleagues, thereby promoting the
long-term growth and profitability of the Company.
The Company intends to ensure that we remain a
responsible and well-regarded employer, by considering
factors from health and safety, skills and competency
development to pay and benefits, and the implications
of decisions on employees.
FINANCIAL STATEMENTSOVERVIEWSTRATEGIC REPORTGOVERNANCE 72 | Accsys Technologies PLC | Annual Report and Financial Statements 2023
73
GOVERNANCE
Corporate Governance
74 Board of Directors
76 Senior Leadership Team
78 Chair’s Statement of Governance
80 Corporate Governance
82 The QCA Corporate Governance Code
(the ‘QCA Code’) Statement of Compliance 2023
88 Audit Committee Report
90 Nomination Committee Report
92 Health, Safety and Environment (‘HSE’)
Committee Report
93 Remuneration Report
108 Directors’ Report
112
Statement of Directors’ Responsibilities
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 74
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
75
Board of Directors
Key to Committees
Audit Committee
Nomination Committee
Remuneration Committee
Health, Safety and Environment Committee
Chair of Committee
Stephen Odell
Steven Salo
Sue Farr
Sean Christie
Trudy Schoolenberg
Alexander Wessels
Louis Eperjesi
Executive Chair
Chief Financial Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director
(Senior Independent Director)
Non-Executive Director
Non-Executive Director
Appointed to the Board
23 June 2020
Appointed to the Board
1 April 2023
Appointed to the Board
27 November 2014
Appointed to the Board
Appointed to the Board
Appointed to the Board
Appointed to the Board
27 November 2014
1 April 2018
18 September 2020
14 June 2022
Background and Experience
Background and Experience
Background and Experience
Background and Experience
Background and Experience
Background and Experience
Background and Experience
Stephen assumed the position of Executive
Chair of the Board on an interim basis on
1 April 2023. On 1 July 2023 Stephen will
revert to Independent Non-Executive Chair.
Stephen came to Accsys as Chair following
38 years of service at Ford Motor Company,
including extensive Board and Chair
positions. This included appointments
as Chairman and Chief Executive of Ford
Europe, Middle East and Africa, CEO of
Volvo Cars, overseeing the sale to Geely and
Global Senior Managing Director of Mazda
Corporation, operating out of Japan.
He most recently held the position
of Executive Vice President of Global
Marketing, Sales and Service and oversaw
these areas for all of Ford’s operations
globally, following work for the company in
the USA, Asia and Europe.
Steven, a chartered accountant, brings
significant experience in senior financial
leadership roles, executing high-value
corporate and business development
transactions, and driving and shaping
businesses for profitable growth. His
experience includes substantial construction
and engineering work.
Prior to joining Accsys, Steven was Group Chief
Financial Officer at Depa PLC. Steven was also
interim CEO of Design Studio Group Ltd from
2019 to 2021 and, prior to joining Depa, was
Head of Strategy, Corporate Development and
M&A at Arabtec Holding PJSC.
Steven formerly worked in investment
banking for both Citigroup and Dresdner
Kleinwort Wasserstein and began his career
at PwC in Australia.
Sue is a highly experienced marketing and
communications professional.
She has been Chair of both the Marketing
Group of Great Britain and The Marketing
Society. A previous Advertising Woman of the
Year, she was awarded an Honorary Doctorate
by the University of Bedfordshire in 2010.
Her previous experience includes being on
the executive management team at Chime
Communications PLC; Europe MD of leading PR
firm Golin Harris, Director of Corporate Affairs
for Thames Television, and she was the BBC’s
first ever female Director of Marketing and
Communications. She was also Non-Executive
Director of Motivcom PLC; a Trustee of the
Historic Royal Palaces; and a Non-Executive
Director of Dairy Crest Group PLC and of
Millennium & Copthorne Hotels PLC.
Sean has extensive knowledge
of finance and strategy in major
businesses and is an experienced
Audit Committee Chair.
Sean’s previous experience has
included being Group Finance
Director of Croda International
PLC and Group Finance
Director of Northern Foods
PLC. He also served as a Non-
Executive Director of: KCOM
Group PLC; Eminate Limited,
a wholly owned subsidiary of
The University of Nottingham;
Cherry Valley Farms Limited
and Produce Investments PLC:
Applied Graphene Materials
PLC and Turner-Townsend LLP.
He is a Fellow of both the
Chartered Institute of
Management Accountants
and the Association of
Corporate Treasurers.
As well as strategy and growth
experience, Dr Schoolenberg
has strong operational
knowledge, gained both during
her time at Shell and thereafter
at Akzo Nobel.
Trudy has nearly 30 years’
experience working for
blue-chip companies in the
chemicals, engineering and high
performance product sectors,
including over 20 years with
Royal Dutch Shell where she led
business strategy and growth
plans for Shell Chemicals, a
business unit with a multi-billion
dollar turnover.
Louis joined the Board following
a successful 33 year career in
the building materials sector.
Louis brings a strong
background of manufacturing
and supply of building products
in international markets,
together with commercial,
strategy development,
M&A and change management
experience.
He was most recently CEO of
Tyman Plc and prior to this,
held senior executive roles in
Kingspan Plc, Baxi Group Ltd,
Lafarge SA and Caradon Plc.
Alexander brings over 30 years
of chemical, pharmaceutical and
process industry knowledge
and experience to Accsys. He
is currently Chief Executive
Officer of Caldic B.V. and
Vice Chairman of Archroma, a
colour and speciality chemicals
company, where he was CEO
for over six years leading the
business through a significant
period of growth and success.
With an MSc in Molecular
Sciences, and an MBA,
Alexander has a strong
track record of improving
business performance and
transformational growth. He
has international experience
including in the Netherlands,
the USA and Switzerland
and has held executive and
management positions with
DSM, Campina and Unilever.
External Appointments
External Appointments
External Appointments
External Appointments
External Appointments
External Appointments
External Appointments
Member of the University of Nottingham
Council (effective 1 August 2021)
None
Sue is currently a Non-Executive Director of:
• British American
Tobacco PLC
• Unlimited Marketing Group Limited
• Helical PLC
• Lookers PLC
• THG PLC
Sean is currently a
Non-Executive Director of:
• Optibiotix Health PLC
Trudy is currently a
Non-Executive Director of:
• SPIE SA
• Elementis PLC
• TI Fluid Systems PLC
Alexander is currently Chief
Executive Officer of Caldic B.V.
Alexander is also a
Non-Executive Director of:
• Archroma (Vice Chairman)
• Agrifirm
• Topigs Norsvin
Louis is currently a
Non Executive Director of:
• Trifast PLC
• Howden Joinery Group plc
•
Ibstock Plc
Louis is also the Chair
of the Trustees at the
Cheltenham Trust.
Notes
• Stepping down at the AGM in September 2023 will be Sean Christie, Sue Farr and Alexander Wessels.
• External appointments includes significant or listed company appointments only.
• Rob Harris stepped down as Chief Executive and ceased to be a Director of Accsys on 31 March 2023.
• William Rudge ceased to be a Director of Accsys on 23 September 2022.
• Nick Meyer stepped down from the Board as a Non-Executive Director on 23 September 2022.
• External appointments includes significant or listed company appointments only.
For a full list of Directors during the year | See the Directors’ Report on page 108
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 76
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Senior Leadership Team
77
The Senior Leadership Team includes the two Executive Directors
and the following individuals:
Group activities are driven and managed by a Senior Leadership Team of which we are particularly proud.
Experts in their fields, the Senior Leadership Team boasts a broad range of sector knowledge and specialism.
Committed to ensure we deliver on our plans for growth and commercial success; it is their hard work and
advice that has supported the growth of Accsys Technologies PLC.
Natalia Bikkenina Hans Pauli
Nick Hartigan
Eddie Pratt
Hal Stebbins
John Alexander
Stephen Cox
George Neel
Jason Jones
Pablo Steenwinkel
Chief People Officer
Director of Corporate
Development
General Counsel and
Company Secretary
Director of Business
Development
Director of Quality,
Supply Chain and
Customer Service
Group Sales Director
Group Manufacturing
and Projects Director
Group Director
of Marketing and
Communications
Group HSE Director
Group Head of
Technology
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Background and
Experience
Natalia is responsible for
all aspects of global HR,
including responsibility
for developing a
comprehensive global HR
strategy which supports
business growth and
expansion, attracts and
retains top talent and
drives high performance.
Natalia joined Accsys in
September 2017, having
worked in a number of
international industrial and
technology businesses.
In her role, Natalia is able
to use her experience of
working for start-ups and
high growth companies
to facilitate the Group
expansion plan. Natalia has
both an MBA and a degree
in Languages.
Hans has held financial
positions across
the banking and biotech
sectors and has significant
experience in investment,
manufacturing, licensing
and distribution. Hans
holds a BA in Business
Administration and has
completed an MA in
Fiscal Economics from the
University of Amsterdam.
His commercial career
began in the banking
sector where he worked
for various institutions
including Barclays, where
he gained investment
and M&A experience. He
has worked for a number
of biotech companies as
Chief Financial Officer,
including Euronext-listed
Pharming Group N.V.
Hans is a Non-Executive
Director of BioTech VC,
MedSciences.
Nick is responsible for
the legal affairs of the
Accsys Group and is also
the Company Secretary,
having joined Accsys in
2022. Nick has particular
legal and regulatory
expertise in corporate
transactions, capital
raisings (equity and debt),
lender management and
complex litigation.
Nick qualified at a leading
UK international law firm.
He has gained extensive
experience working with
or for companies in the oil
and gas, construction,
building materials and
manufacturing sectors.
Eddie led the initial
establishment of the wood
acetylation business in
2003, subsequent flotation
as Accsys Technologies
PLC, and development of
both the Accoya brand
and the production
facility in Arnhem. His
in-depth knowledge
of the business helps
develop new markets and
partnerships for Accsys
and its branded products,
including licensing and
establishment of joint
ventures. Eddie led
the development and
negotiation of the Accoya
USA joint venture with
Eastman.
Eddie’s earlier career was
in investment banking,
receiving his training with
JP Morgan and working
at its affiliate Saudi
International Bank where
he specialised in corporate
and project finance.
Hal has spent most of
his career leading global
marketing, sales and
services operations for
a variety of businesses,
including IBM’s forest
products solutions team.
His formal education
culminated in graduating
summa cum laude with an
MBA in International
Management from the
Anderson School at the
University of New Mexico.
When he joined Accsys
in 2007, Hal was initially
responsible for the Group’s
first worldwide marketing
strategy. Since then,
Hal has led the growth
of our international
distributorship and
licensing management.
Currently he leads teams
responsible for wood and
chemical supply critical
to production, customer
service and quality
assurance.
John is responsible for all
aspects of product sales
for Accsys, managing a
team across the globe.
With a degree in Forestry
and Forest Products from
the University of Wales
and an MSc in Timber
Engineering from the
University of Maine, USA.
John’s career in the wood
product industry started
as technical manager at
Jeld-Wen, the world’s
largest manufacturer of
windows and doors, and
he subsequently moved to
BSW Timber, the largest
forestry and sawmilling
group in the UK.
Initially joining Accsys
as Head of Product
Development in 2010, John
became Director of Sales
and Product Development
in 2015 and in 2020
tightened the focus of
his role on sales activities
and strategy.
Stephen joined Accsys
in March 2023, taking on
a newly created role. He
oversees Accsys’ global
manufacturing sites
and projects, and drives
forward operational
efficiencies. This role
supports and reinforces
Accsys’ global expansion
plans, as well as the
Company’s commitment
to, and drive for, achieving
operational and project
excellence.
Stephen spent 25 years at
the manufacturer Coats
PLC, rising to the position
of Group Manufacturing
Director. He brings a
wealth of experience
in manufacturing
transformation, strategy
and ramp up.
George joined Accsys
in August 2019 with
responsibility for marketing
and communications
across the Group. He and
his team also lead ESG
and sustainability strategy
development, promotion
and implementation
across the organisation.
George began his career
at L’Oréal on the Graduate
Management Scheme
having studied Modern
Languages at the
University of Bristol.
He subsequently worked at
the drinks company Diageo
in commercial planning
before transitioning into
marketing. George gained
experience working in
a series of European
and Global marketing
roles, latterly heading up
the European Shopper
Marketing Team.
Jason joined Accsys in
November 2020 and is
responsible for driving
HSE across the business.
A mechanical engineer
by trade, Jason began his
career at the British Vita
business –Vitamol. In 1994,
he joined the British Vita
QHSE function as one of
its Group HSE Managers
to its global business.
Jason subsequently
established a HSE
consultancy business
before eventually joining
Warburtons in 2011 as
Head of HSE.
In 2014, he became the
European HSE Director
for Ecobat Logistics,
the world’s largest
lead smelter and was
responsible for HSE
improvements across 16
European operations.
With 20+ years of
technology leadership
experience in the
chemicals industry, Pablo
started his career at
Accsys in January 2021
and is responsible for all
aspects of product and
process support and
innovation for Accsys,
leading the Global
Technology Centre (GTC),
a global team of experts
in the fields of wood
(modification) science,
chemistry, process
technology and intellectual
property development.
Pablo has an MSc in
Chemistry from the
University of Leiden (NL)
and a PhD in Chemistry
from the University
of Utrecht (NL) and
previously worked at
Zeneca Resins (now part of
Covestro), Avery Dennison
and, most recently, at Flint
Group as Senior Technical
Director Packaging
Inks EMEA.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 78
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Chair’s Statement of Governance
79
The Board of Directors
It has been a year of change on the Board, and
at the year end, in order to provide stability and
reassurance, I stepped in as Executive Chair
on an interim basis, pending the appointment
of a permanent CEO. We were pleased to
announce recently that Dr Jelena Arsic van Os
will join the Board on 27 June 2023 and then
take up her role as Chief Executive Officer on
1 July 2023, at which point I will return to my
previous role as an Independent Non-Executive
Chair of the Board. Jelena’s considerable and
relevant experience makes her a great fit for
Accsys and well qualified to lead the business
into the next phase of growth as we continue
with our mission of changing wood, to change
the world. I look forward to welcoming her to
the Company.
We are grateful to former CEO Rob Harris, who
left the business on 31 March 2023 and wish him
success in his future endeavours.
We were pleased to welcome Steven Salo to the
Board on 1 April 2023 as our new Chief Financial
Officer. Steven’s background as an international
Group CFO with experience focused on driving
improvement in financial fundamentals will be
Sustainability is at the very
heart of what we do and
as a Board, we are hugely
aware of our impact both
in terms of climate change
and responsible sourcing.”
Stephen Odell
Executive Chair
Dear Shareholder,
I am pleased to introduce this report, which sets out
highly beneficial to Accsys as we enter our next
our governance framework and compliance with the
growth phase. Will Rudge stepped down from
ten principles of the Quoted Companies Alliance
the Board at the conclusion of the 2022 AGM
Corporate Governance Code. The Board is committed
and ultimately left the Group on 19 April 2023.
to maintaining high standards of corporate
We take this opportunity to thank Will Rudge for
governance to help Accsys make a lasting impact
staying on to support Accsys and transition his
on the world, deliver its strategic goals and achieve
responsibilities to Steven and wish him all the best
long-term success for the benefit of its stakeholders.
with the next step in his career.
The Company has also announced a number of
Non-Executive Director changes. As they reach
the end of their nine-year terms, Sue Farr and
Sean Christie will step down from the Board
at the conclusion of the Company’s AGM in
September 2023. Further, due to increases in
his executive commitments, Alexander Wessels
has decided not to stand for a further three-
year term and will therefore step down from the
Board at the AGM when his term concludes. On
behalf of the Board, I would like to thank Sue
and Sean for their considerable contribution
to Accsys over the last nine years and for the
support and guidance they have given to newer
members of the Board including myself.
I would also like to thank Alexander for his input to Accsys
Sustainability is at the very heart of what we do and
over the last three years where his extensive experience,
as a Board, we are hugely aware of our impact both
including providing perspective from the view of an active
in terms of climate change and responsible sourcing.
CEO, has been invaluable.
While searching for replacement Non-Executive Directors,
we decided to reduce the size of the Board, reflecting our
commitment to best practice in corporate governance
and also to improve efficiency and decision-making as
we focus on delivering profitable growth and value for
shareholders. As we announced in June 2023, the Board is
seeking to appoint two new high-quality and experienced
Independent Non-Executive Directors, with the intention
of one acting as Chair of the Audit Committee, and the
second as Chair of the Remuneration Committee. The
search for both these roles is well underway and the
Company plans to give further updates ahead of the AGM
in September.
It has been a busy year for the Board. Reflecting on the
executive changes above, together with ensuring an
appropriate level of scrutiny and input on key issues such as
the review of Hull, the Board committed a significant amount
of time to Board meetings well over and above the scheduled
meetings for the year. This reflects the professionalism,
passion and determination the Board has in ensuring the long-
term sustainable success of the Company. See the Directors’
Report on page 108 for further information.
For further detail on the Board membership during the year,
see the Directors’ Report | Page 108
Board performance
This year we improved our Standard and Poor’s
Global Corporate Sustainability Assessment by 13%
compared to last year. Please see pages 56 to 66 for
further details of our FY23 ESG performance and
outlook for FY24.
Quoted Companies Alliance
Corporate Governance Code (the QCA Code)
Accsys has adopted the QCA Code and follows and
reports against it on a comply-or-explain basis.
As a company with strong values and purpose, this
also shapes our relationships with our stakeholders
from our employees to our distributors, licensees
and others. We want to ensure that our business
is not only a commercial success, but also run in
a responsible fashion as we continue to advance
technologies for a better and more sustainable world.
The Board believes that good governance plays a key
part in Accsys’ ability to achieve its strategic aims,
the successful long-term development of the Group,
and the creation of value for all our stakeholders.
As such, corporate governance and social
responsibility lies at the very core of our business
and remains a key focus for the Board.
In the following section we outline the Company’s
approach to corporate governance and the QCA
Code. For further detail on each section please refer
During the year, the Board participated in an internal
to the Statement of Compliance of the QCA Code which
Board effectiveness review and key actions were identified
can be found on our website at www.accsysplc.com.
and will be implemented during the coming months.
Noting the recent Board restructure, the action plan will
focus on establishing relationships and strengthening the
cohesiveness of the Board to ensure it works together as
effectively as possible to achieve long-term sustainable
success of the business. The current Board is united in
the view that its priority for the year ahead is to work
together to achieve the purpose of the Company for the
benefit of all its stakeholders.
ESG
We recognise the importance of environmental,
social and governance (ESG) as a key area of focus
for our stakeholders, and as a business we are very
mindful of the impact on the environment and the
communities in which we operate.
AGM
We will notify shareholders about our AGM in due
course, with our intention being that it will be held
in person on 20 September 2023. For further details
please refer to the AGM Notice that will be sent out
to shareholders under separate cover.
The year ahead
As we look ahead through FY24, the Board will be
focusing on embedding the new CEO and CFO and
finalising the appointment of new Non-Executive
Directors, all with a view to supporting the
Company to deliver on its strategic objectives
in the year.
Stephen Odell
Executive Chair
26 June 2023
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Corporate Governance
81
Board Leadership
Directors’ attendance record
The Board meets regularly and is responsible for strategy, performance, approval of major capital projects and the
The following table shows the attendance record of individual Directors at scheduled meetings of the Board and
framework of internal controls. To enable the Board to discharge its duties, all Directors receive appropriate and timely
its Committees in the year to 31 March 2023. In addition to the scheduled meetings, Directors attended a number
information. Briefing papers are distributed to all Directors in advance of Board meetings.
of additional meetings throughout the year including Board Committee meetings, Non-Executive Director only
All Directors have access to the advice and services of the Company Secretary. The appointment and removal of the
Company Secretary is a matter for the Board as a whole. In addition, procedures are in place to enable the Directors to
obtain independent professional advice in the furtherance of their duties, if necessary, at the Company’s expense.
During the year, serving Directors attended the scheduled Board meetings either by video conference or in person.
In addition to the scheduled meetings, a number of ad hoc meetings were convened including Committees of the
Board with delegated authority from the Board. There is frequent contact between all the Directors in connection with
the Company’s business including Audit, Nomination, Remuneration and HSE Committee meetings which are held as
required, but as a minimum twice per annum unless the relevant terms of reference require more.
All Directors are subject to annual re-election by the shareholders at Annual General Meetings.
Day-to-day operating decisions are made by the Executive Directors with support from the Senior Leadership Team.
Governance framework
Board roles and responsibilities
Chair
• Leads the Board and is
responsible for the overall
effectiveness of Board
governance
• Sets the Board’s agenda,
with emphasis on strategy,
performance and
value creation
• Shapes the culture of
the Board
Chief Executive
Officer
• Develops strategies, plans
and objectives to propose
to the Board
• Leads the organisation
to ensure the delivery
of the strategy
Senior Independent
Director
• Acts as a sounding board
for the Chair
• Available to shareholders
if they require contact
generally and if normal
channels are not
appropriate
• Leads the annual appraisal
of the Chair
Non-Executive
Directors
• Demonstrate independence
and impartiality
• Bring experience and
special expertise to
the Board
• Constructively challenge
the Executive Directors
• Monitor the delivery of
the strategy within the
risk and control framework
set by the Board
• Monitor the integrity
and effectiveness of the
Group’s financial reporting,
internal controls and risk
management system
Leadership structure
Board of Directors
Audit Committee
Remuneration Committee
Nomination Committee
HSE Committee
Senior Leadership Team
meetings and other meetings as dictated by business need (see notes below table).
Director
Stephen Odell1
Robert Harris
Sean Christie
Louis Eperjesi2
Sue Farr
Montague John ‘Nick’ Meyer3
William Rudge4
Dr Geertrui ‘Trudy’ Schoolenberg
Alexander Wessels
Board
Audit
Committee
Remuneration
Committee
Nomination
Committee
HSE
Committee
Attended
Attended
Attended
Attended
Attended
6/6
6/6
6/6
5/5
6/6
2/3
3/3
5/6
6/6
3/3
n/a
3/3
3/3
2/3
n/a
n/a
3/3
3/3
5/5
n/a
5/5
3/3
5/5
n/a
n/a
4/5
5/5
6/6
n/a
6/6
5/5
6/6
n/a
n/a
6/6
6/6
2/2
4/4
n/a
n/a
n/a
n/a
n/a
4/4
2/4
1 Stephen Odell attended two HSE Committee meetings in the capacity of Alternate Director.
2 Louis Eperjesi was appointed to the Board on 14 June 2022.
3
Nick Meyer was determined to be a Non-Independent Director on 16 June 2020 and stepped down from membership of all Board Committees on that date.
He was subsequently invited to join Committee meetings as a guest. He subsequently resigned from the Board with effect on 23 September 2022.
4 William Rudge stepped down from the Board on 23 September 2022 and was subsequently invited to join certain Committee meetings as a guest.
Notes
‘x/x’ indicates the number of scheduled meetings attended out of the number of possible meetings the Director could have attended during the year.
In addition to the scheduled meetings indicated above, a further 16 Board meetings, one meeting of the Audit Committee, four meetings of the Remuneration
Committee, and six meetings of the Nomination Committee were held throughout the year.
Not all Directors are members of the Board Committees and these are recorded as n/a in the table. However, it should be noted that these Directors often
attended Committee meetings by invitation as required.
For biographical details of the Board and Senior Leadership Team | See pages 74 to 77
For diversity of the Board | See page 91
For Board activity | See pages 68 to 69
Audit, Risk and Internal financial control
The Board is responsible for establishing and maintaining the Company’s system of internal financial control and
places importance on maintaining a strong control environment. The consideration of opportunities and risks
remains a key area of focus for the Board. The Board reviews Accsys’ risk appetite annually and regularly considers
the key and emerging risks relevant to Accsys’ business, together with mitigations and controls. The key procedures
which the Directors have established with a view to providing effective internal financial control are as follows:
• The Company’s organisational structure has clear lines of responsibility
• The Company prepares a comprehensive annual budget that is approved by the Board
• Monthly results are reported against the budget and variances are closely monitored by the Directors
• The Board is responsible for identifying the major business risks faced by the Company and for determining
the appropriate courses of action to manage those risks.
The Directors recognise, however, that such a system of internal financial control can only provide
reasonable, not absolute, assurance against material misstatement or loss.
For the Audit Committee Report | See pages 88 to 89
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83
The QCA Corporate Governance Code (the ‘QCA Code’)
Statement of Compliance 2023
The QCA Code is constructed around ten broad principles of which our Company complies with all ten. Set out below
are the principles of the QCA Code and a summary explanation of the Company’s application against each key principle.
Principle 1. Establish a strategy and business model which promote long-term value for
shareholders
Compliant
How this was applied
•
The Company’s strategy is to:
(i) develop market opportunities to drive revenue growth by
increasing the Accoya and Tricoya volume sold and number
of distributors by developing market opportunities into
core business;
Where to find further
information in the Accounts
• Business model and strategy
(page 26 and 28)
• Company’s Corporate
Governance QCA Compliance
Statement (page 82)
(ii) grow its global manufacturing production position and production
• Strategic Report (page 20)
capacity in Europe, the USA and Malaysia and establish new platforms
in key markets in support of, and to enable, demand growth;
(iii) develop research and development of product and process-
related technologies and IP programmes to protect and grow its
• Board activity (pages 68 to 69)
• Stakeholder engagement
(page 67)
leading market position; and
(iv) develop its people and organisational capability to enable Accsys
to meet its growth objectives.
•
The Board’s annual schedule of agenda items ensures that the
strategy and Business Model is reviewed at least once every year.
•
The programme of Board effectiveness review considers whether
the Board spends enough time on strategy and its business model.
• Decisions made in Board meetings consider key stakeholder groups
and long-term value (including for shareholders). If, and to the extent,
issues come to light which challenge the Company’s ability to meet its
strategy and Board model, the Board proactively addresses these.
Our Statement of Compliance explains in further detail the Company’s
key strengths which in turn promote long-term value for shareholders.
Principle 2. Seek to understand and meet shareholder needs and expectations
Compliant
How this was applied
Where to find further
information in the Accounts
• Communications with shareholders are given high priority to ensure
• Corporate Governance
that its strategy, business model and performance are clearly
QCA Compliance Statement
understood. There is regular dialogue with shareholders, including
(page 82)
webcast presentations after the Company’s preliminary announcement
of the year-end results and six monthly results, regular Regulatory
• Stakeholder engagement
(page 67)
News Service announcements and trading updates.
• Accsys also organises investor roadshows in the UK and Netherlands
offering significant shareholders an opportunity to discuss the
business, management and strategy of the Company with the Executive
Directors. Representatives of the Company meet regularly with
shareholders. For example, during FY23, the Company met with 121
shareholder representatives from 31 unique institutions, engaging
in dialogue with 59.5% of its shareholder register. This degree of
engagement helped the Board to better understand shareholders’
expectations and motivations.
• Accsys also remains informed of shareholders’ views via regular
dialogue with its corporate brokers.
• The Board uses the Annual General Meeting to communicate with
investors and welcomes their participation. The Chairs of the Board
and all Board Committees, together with all other Directors, routinely
attend the AGM and are available to answer questions from investors.
Principle 3. Take into account wider stakeholder and social responsibilities and their
implications for long-term success
Compliant
How this was applied
Where to find further
information in the Accounts
• The Company’s business model identifies that investment in key
• Stakeholder engagement
resources on which the business relies – Accsys’ intellectual
(page 67)
• Corporate Governance
QCA Compliance Statement
(page 82)
• See www.accsysplc.com/ for
the Sustainability Report and
Modern Slavery Statement
property, expertise, innovation, research and development,
branding, employees and relationships with numerous third parties
including business partners, equipment manufacturers, wood
suppliers, distributors and customers – underpins all that Accsys
does. Investment from the Company’s other key stakeholders, its
shareholders and finance providers make this possible.
• The Board regularly receives reports on the status of key
stakeholders, including investor relations led updates in respect of
shareholders and updates on all levels of the workforce from the
Chief People Officer. This is complemented by frequent briefings
on ESG and customer and supplier issues to members of the Board.
These sources support the Board to consider stakeholders’ views
during relevant decision-making processes.
•
In addition to the above, the Board takes steps to verify feedback.
For example, each year, the Board invites personnel to attend
‘Meet the Board Lunches’ at its offices, providing an informal
forum to facilitate and encourage engagement and open dialogue
between the Board and the Company’s workforce.
• Further evidence of Accsys’ awareness of and commitment
to acting in a socially responsible way is set out in the Accsys
Sustainability Report. This Report includes details of the impact
that Accsys’ business and operations has on the wider community.
Furthermore, the Company has increased reporting scope and
transparency, including reporting to established global reporting
frameworks GRI and SASB. The Company published its first
reports under these standards in FY22 and is going to publish
reports under these standards again for FY23. The information
required for GRI reporting has increased and so the Company will
be providing more information than FY22 on its compliance with
these standards. The ‘further information’ column provides details
of where the Sustainability Report can be downloaded from.
• The Company is committed to continuing research and
development concerning its products and processes.
• During FY23, Accsys participated in a number of shareholder
ESG surveys. Feedback from these surveys was positive,
including scoring the highest rating possible in one survey.
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85
The QCA Corporate Governance Code (the ‘QCA Code’)
Statement of Compliance 2023 continued
Principle 4. Embed effective risk management, considering both opportunities and threats,
throughout the organisation
Compliant
How this was applied
Where to find further
information in the Accounts
• The Board meets regularly and is responsible for strategy,
• Risk and risk management
performance, approval of major capital projects and the framework
(page 50)
• Corporate Governance
QCA Compliance Statement
(page 82)
• See www.accsysplc.com/ for
the Sustainability Report/
Modern Slavery Statement
and Audit Committee Terms
of Reference
• Audit Committee Report
(page 88)
• Strategic Report (page 20)
of internal controls. To enable the Board to discharge its duties, all
Directors receive appropriate and timely information. Briefing papers
are distributed to all Directors in advance of Board meetings.
• The Board is responsible for establishing and maintaining the
Company’s system of internal risk management, including in relation to
its priority surrounding health, safety and the environment, and places
importance on maintaining a strong financial control environment. The
key internal procedures which the Directors have established with
a view to providing effective internal controls include clear lines of
responsibility within the organisation structure, a comprehensive annual
budget that is approved by the Board and the identification of major
business risks to enable appropriate action. Furthermore, monthly
results are reported against the budget and variances are closely
monitored by the Directors.
• The Audit Committee is responsible for monitoring compliance with
accounting and legal requirements and for reviewing the annual and
interim financial statements prior to their submission for approval by
the Board.
• The Risk Committee – comprised of the Executive Directors and certain
members of the Senior Leadership Team – regularly meet and update
a risk register which outlines the nature of principal risks facing the
Company and any mitigating factors required to protect against such
risks. The Risk Committee reports on the risk register to the Audit
Committee and thereafter the Audit Committee reports on the same to
the Board.
Principle 5. Maintain the Board as a well-functioning, balanced team led by the Chair
Compliant
How this was applied
Where to find further
information in the Accounts
• The Board has gone through a period of change. The Nomination
• Board of Directors (page 74)
Committee’s Terms of Reference require it to ensure recommendations
are made to the Board on the Board’s composition, including with
regard to diversity of skill, thought, background and experience.
• As at the date of this Annual Report, the Board is comprised of one
Executive Chair (appointed as such on an interim basis with effect from
1 April 2023, having previously been Independent Non-Executive Chair),
five Independent Non-Executive Directors, one of whom acts as Senior
Independent Director, and the Chief Financial Officer. On 1 July 2023,
the Executive Chair will revert to his prior role of Independent Non-
• Directors’ attendance record
(page 81)
• Audit Committee Report
(page 88)
• Nomination Committee Report
(page 90)
• Remuneration Committee
Report (page 93)
Executive Chair and Jelena Arsic van Os – will join the Board as Chief
• HSE Committee Report
Executive Officer.
• The Board has constituted four standing Committees: the Audit
Committee, the Nomination Committee, the Remuneration Committee
and the HSE Committee, with ad hoc committees constituted
as required.
•
In addition to regular scheduled Board meetings, there is frequent
contact between all the Directors in connection with the Company’s
business including Audit, Nomination and Remuneration Committee
meetings which are held as required, but as a minimum twice per annum.
• Non-Executive Directors’ terms of appointment provide that they will
spend as much time as necessary and/or reasonably requested by the
Board for the fulfilment of their duties. This is anticipated to be in the
order of 20 (or more) days per annum, although this is not definitive.
All Executive Directors are engaged on a full-time basis.
• The Board has a Board effectiveness review programme. The Board
receives updates and information on a structured basis through Board
and Committee meeting packs, together with ad hoc information
and dialogue provided as necessary by the Executive Directors
between meetings.
(page 92)
• See www.accsysplc.com
(‘Investors’ page) for the
Company’s Corporate
Governance QCA Compliance
Statement, Sustainability
Report, Modern Slavery
Statement, Terms of Reference
Audit Committee, Terms
of Reference Nomination
Committee, Terms of
Reference Remuneration
Committee and Terms of
Reference HSE Committee
Principle 6. Ensure that between them the Directors have the necessary up-to-date
experience, skills and capabilities
Compliant
How this was applied
Where to find further
information in the Accounts
• The Board is satisfied that it has the appropriate balance of financial,
• Board of Directors (page 74)
public markets and sector skills and experience, as well as an
appropriate balance of personal qualities and capabilities and where
• Corporate Governance
QCA Compliance Statement
appropriate, each Director keeps their skills up-to-date, for example by
the completion of the Group’s online training programme, attendance
(page 82)
at seminars, briefings and through literature.
• Through the Nomination Committee, the Board ensures that it
understands and challenges its own diversity, including gender balance,
as part of reviewing the Board’s composition.
• Expert advisors support the Group’s businesses and contribute relevant
industry and commercial experience. These advisors are drawn from
industry, finance, legal and other advisory groups. For example, Deloitte
LLP is appointed by the Remuneration Committee as an independent
adviser and assisted the Board in the drafting of the Remuneration
Policy that was approved by the shareholders at the 2021 AGM. Further
information on the engagement and role of external advisors can be
found in our Statement of Compliance of the QCA Code.
• All Directors have access to the advice and services of the Company
Secretary and in-house legal counsel. In addition, procedures are in
place to enable the Directors to obtain other independent professional
advice (legal or otherwise) in the furtherance of their duties, if
necessary, at the Company’s expense.
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87
The QCA Corporate Governance Code (the ‘QCA Code’)
Statement of Compliance 2023 continued
Principle 7. Evaluate Board performance based on clear and relevant objectives,
seeking continuous improvement
Principle 9. Maintain governance structures and processes that are fit for purpose and support
good decision making by the Board
Compliant
How this was applied
Where to find further
information in the Accounts
Compliant
How this was applied
Where to find further
information in the Accounts
• The Board undertakes an annual review process whereby each
• Corporate Governance
Director completes a ‘Board and Director Review and Evaluation Paper’,
QCA Compliance Statement
ensuring that the Board regularly undertakes a formal and rigorous
(page 82)
evaluation of its own performance and that of its Committees and
• Board performance (page 79)
individual Directors.
• During FY23, the Board made progress against recommendations made
in the 2023 Board Evaluation.
• An internal Board effectiveness review was carried out in 2023 with an
external review planned for 2024.
• The results of the Board evaluation were shared with the Board as
a whole while the results of any individual assessments remained
confidential between the Chair and the Director concerned. The results
of the 2023 internal Board evaluation were discussed with the Board
at a meeting in May 2023 and areas for development will be reviewed
further in FY24.
Principle 8. Promote a corporate culture which is based on ethical values and behaviours
Compliant
How this was applied
Where to find further
information in the Accounts
• Since Accsys is an eco-friendly company that combines chemistry,
• Statement of Compliance of
technology and ingenuity to create high performance, sustainable wood
the QCA Code (page 82)
• Sustainability Report
(page 56)
• Statement of Engagement
with Employees (page 71)
• Stakeholder engagement
(page 67)
• Environmental, Social
and Governance
Statements (available
at www. Accsysplc.com
‘Investors’ page)
building products, a focus on social responsibility lies at the very core
of its business.
• Accsys aims to reduce the use of environmentally unfriendly building
materials and products by the utilisation of its propriety technology
and the introduction and uptake of its products around the world.
The planet continues to consume endangered materials like tropical
hardwood and non-renewable, high emitting building materials such
as plastics, concrete and metals at an alarming rate. Accsys’ acetylated
wood products offer alternative, sustainable new materials that resolve
many of the environmental limitations that commonly used building
materials have, whilst not compromising on performance. At present,
Accoya is the only building product perfectly fitting in the biocycle of
the circular economy while having the same performance as typical
techno-cycle building products such as plastics and metals which
cannot be renewed.
• The strategy and business model of the Company in relation to
ethical values is readily promoted throughout and is evident from the
Company’s accreditations.
• The Board receives updates from the Executive on corporate culture
which enables it to monitor and provide input into how Accsys’ ethical
values and behaviours are implemented through the organisation.
• The Board meets regularly and is responsible for strategy,
• Corporate Governance
performance, approval of major capital projects and the framework
QCA Compliance Statement
of internal controls. To enable the Board to discharge its duties, all
(page 82)
Directors receive appropriate and timely information. Briefing papers
are distributed to all Directors in advance of Board meetings.
• See www.accsysplc.com for
Sustainability Report, Modern
• Board meetings are usually held in London with site visits scheduled to
Slavery Statement, Terms of
take place annually in at least Arnhem to ensure the Board has a deep
Reference Audit Committee,
understanding of the Group’s operations. In addition to the scheduled
Terms of Reference
meetings there is frequent discussion between all the Directors in
Nomination Committee
connection with the Company’s business including Audit, Nomination,
and Terms of Reference
Remuneration Committee and HSE Committee meetings which are held
Remuneration Committee.
• Section 172(1) Statement
(page 67)
as required, but as a minimum twice per annum, save where the relevant
Committee Terms of Reference require a higher frequency. Copies
of the Terms of Reference for the Committees are available on the
Corporate Governance page of our website, www.accsysplc.com.
• Day-to-day operating decisions are made by the Executive Directors
with support from the Senior Leadership Team.
• The Board is responsible for the long-term success of the Company.
There is a formal schedule of matters which are reserved for the Board,
including matters relating to strategy and management, structure and
capital, financial reporting and controls, internal controls, contracts,
communications, board memberships, remuneration, delegation of
authority, corporate governance and Group policies. This schedule
of ‘matters reserved’ is reviewed periodically, and was updated in
September 2021 to reflect the Group’s evolution as a business and to
update it in line with best corporate governance practice, as applicable
for Accsys.
Principle 10. Communicate how the Company is governed and is performing by maintaining
a dialogue with shareholders and other relevant stakeholders
Compliant
How this was applied
Where to find further
information in the Accounts
• The Company regularly communicates with shareholders including
• Corporate Governance
presentations after the Company’s preliminary announcement of the
QCA Compliance Statement
year-end results and six-monthly results and bi-annual webcasts. The
(page 82)
Board uses the Annual General Meeting to communicate with investors
and welcomes their participation.
• The Company issues regular news to its stakeholders via RNS, all of
which are displayed on the Company website (News).
• Constitutional and governance information, including relating to
shareholder meetings and the outcome of shareholder votes, can also
be found on the Company website (Corporate Governance).
• As noted above, the Board has constituted four standing Committees:
the Audit Committee, Nomination Committee, Remuneration
Committee and HSE Committee, with ad hoc Committees constituted
as required. Details of the Committees’ work during the year can be
found in the Further Reading links opposite.
• Nomination Committee
Report (page 90)
• Audit Committee Report
(page 88)
• Remuneration Report
(page 93)
• HSE Committee Report
(page 92)
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Audit Committee Report
89
The Committee’s role is to
act on behalf of the Board
of Directors and oversee all
material aspects of the Group’s
financial reporting, internal
control and audit functions.”
Sean Christie
Chair of the Audit Committee
MEMBERSHIP
Sean Christie (Chair of the Audit Committee)
Stephen Odell
Trudy Schoolenberg
Sue Farr
Louis Eperjesi
Alexander Wessels
Responsibilities
• Financial reporting
• Narrative reporting
• Risks and controls
• External auditors
• Internal Audit
• External corporate financial and tax advisors
In exercising its role, the Directors have regard to the
recommendations put forward in the QCA Corporate
Governance Code. Sean Christie is the Committee
member with recent and relevant audit experience.
Role of the Committee
The Committee’s role is to act on behalf
of the Board of Directors and oversee all
material aspects of the Group’s financial
reporting, internal control and audit
functions. The Committee’s role includes a
particular process on the qualitative aspects
of financial reporting to shareholders and
on Group processes for the management of
business/financial risk and for compliance
with significant applicable legal, ethical and
regulatory requirements.
The Audit Committee has primary
responsibility for monitoring the quality
of internal controls and ensuring that the
financial performance of the Company is
properly measured and reported on. The
responsibilities of the Audit Committee
include approving certain related party
transactions, and identifying irregularities in
the management of the Company’s business,
through consultation with the Company’s
external auditors, and proposing remedial
measures to the Board of Directors.
The Audit Committee meets at least twice a year.
For attendance at Audit Committee meetings
see Directors’ attendance record | Page 81
The Terms of Reference for the Audit Committee are
available on the Company’s website |
www.accsysplc.com/investors/corporate-governance
The Audit Committee considers the independence and objectivity of the external auditors on an annual basis, with
particular regard to non-audit services.
The Audit Committee is entitled to obtain, at Accsys’ expense, independent legal, accounting or other professional
advice on any matter it believes is necessary to do so.
Key matters addressed by the Committee during the year
Financial reporting
External audit matters
– Review of the integrity of key financial
– Reviewed the independence, objectivity and
announcements (including the interim results)
effectiveness of PwC
– Review of the Annual Report and Financial
– Reviewed PwC’s external audit plan taking
Statements to confirm the report as a whole
account of the scope, materiality and audit
was fair, balanced and understandable
risks and agreeing the audit fees
– Reviewed and discussed PwC’s reports to
– Monitored the value of non-audit services
the Committee
– Reviewed the going concern basis of
provided by PwC, ensuring the services
do not affect the auditors’ objectivity and
accounting and the longer-term forecasts and
independence
– Reviewed the Key Accounting and Financial
reporting issues
– Review of PwC fees and approval of PwC as
Auditor for the financial year ending 2023 and
– Review of tender process for the financial year
ending 2024
Risk management
Areas of focus
– Undertook a detailed review of the Group’s
– Impairment Review
risk register and the related mitigations,
ensuring that risks are appropriately identified,
evaluated and mitigated, as appropriate.
See Risk section from page 50
– Guarantee to FHB as part of Accoya USA
financing
– Accoya USA – Joint venture formation
– Cleantech Building Materials PLC valuation
– Corporation Tax
Corporate governance
– Reviewed changes in the field of corporate
governance
Sean Christie
Chair of the Audit Committee
26 June 2023
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Nomination Committee Report
91
It has been a significant year
for Accsys in terms of Board
changes.”
Stephen Odell
Chair of the Nomination Committee
MEMBERSHIP
Stephen Odell (Chair of the Nomination Committee)
Sue Farr
Sean Christie
Trudy Schoolenberg
Louis Eperjesi
Alexander Wessels
Responsibilities
• Ensure that there is a formal, rigorous and transparent
procedure for appointments to the Board;
Board and Chair Independence
Appointments to the Board are controlled by
the Nomination Committee. The Nomination
Committee’s Terms of Reference state that
a majority of Committee members should
be Independent Non-Executive Directors.
The majority of the Board of Directors are
Independent Non-Executive Directors who
provide constructive challenge, strategic
guidance and advice on certain areas. During
FY23, the Non-Executive Chair (as he then was),
Stephen Odell, and the Senior Independent
Non-Executive Director, Trudy Schoolenberg,
were independent. The Committee
recommended to the Board that Stephen Odell
assume the role of Executive Chair of the Board
on an interim basis with effect 1 April 2023 in
order to bridge the gap between the departure
of Rob Harris and the appointment of his
successor. On 1 July 2023, Stephen Odell will
return to his prior role of Non-Executive Chair.
Role of the Committee
The Committee is responsible for the orderly
succession of both the Board and senior
• Lead the process for appointments and make
leadership positions and for overseeing the
recommendations to the Board;
development of a diverse pipeline.
• Assist the Board in ensuring its composition is
regularly reviewed and refreshed, taking into
account the length of service of the Board as a
whole, so that it is effective and able to operate in
the best interests of shareholders;
• Ensure plans are in place for orderly succession to
positions on the Board, the Company Secretary and
the Executive Committee members;
• Oversee the development of a diverse pipeline for
succession; and
• Work and liaise with other Board committees, as
appropriate, including the Remuneration Committee
in respect of any remuneration package to be
offered to any new appointee of the Board.
In exercising its role, the Committee has regard to
the recommendations put forward in the QCA
Corporate Governance Code.
Key matters discussed during the year
It has been a significant year for Accsys in
terms of Board changes including the following
significant appointments:
Appointment of Chief Financial Officer
Accsys announced on 24 March 2023 that
Steven Salo had been appointed Chief Financial
Officer and a member of the Board of Accsys,
with effect from 1 April 2023.
For attendance at Nomination Committee meetings
see Directors’ attendance record | Page 81
The Terms of Reference for the Nomination Committee
are available on the Company’s website |
www.accsysplc.com/investors/corporate-governance
Appointment of Executive Chair and appointment
of Chief Executive Officer
Former CEO Rob Harris left the business on 31 March 2023
and in order to provide Accsys with continuity whilst the
search process was underway, Stephen Odell, Chair of the
Board of Directors, assumed the role of Executive Chair of
Accsys on an interim basis on 1 April 2023.
Executive Director appointment process
1. Independent search consultants
2. Review of the balance of skills, knowledge,
independence, diversity and experience
required was conducted by the Committee
On 4 April 2023, the Board announced the appointment of
3. Shortlist of candidates was compiled and
Dr Jelena Arsic van Os as Chief Executive Officer Designate.
She will join the Board of Accsys on 27 June 2023 and become
reviewed by the Committee
Chief Executive Officer on 1 July 2023. Upon her appointment
4. Interviews were held
becoming effective, Stephen Odell will step down as
Executive Chair and revert to his position as an Independent
Non-Executive Chair of the Board.
Board appointments
The Terms of Reference require the Nomination Committee
to give full consideration to succession planning for both
the Directors and the Senior Leadership Team. In doing
so, the Committee must consider the challenges and
5. The Committee recommended the candidates
for appointment to the Board
6. The Board reviewed and approved the
candidates for appointment
Internal Board effectiveness review
opportunities facing the Company as well as the skills,
1. Board agreed basis and scope of review
diversity (including diversity of gender, social and ethnic
backgrounds, cognitive and personal strengths), and
2. Tailored questionnaires distributed
experience required on the Board and Senior Leadership
to Board members
Team both now and in the future. The length of service of
the Board as a whole and the need for its membership to
be refreshed is regularly reviewed. All Board appointments
are made on an objective basis and on merit.
Stephen Odell
Chair of the Nomination Committee
26 June 2023
3. Board members considered and
completed questionnaires
4. Responses were compiled and presented to
Board by the Company Secretary
5. Board discussion on results
Board gender
Board Independence
6. Agreed action plan of continuous improvement
Male
Female
5
2
Independent
Non-Independent
5
2
Senior manager gender
Length of Tenure
of Directors1
Male
Female
9
1
0-3 years
4-6 years
6-9 years
4
1
2
1
Tenure is calculated on number of complete years to 30 June 2023.
7. Update to be provided in the Annual Report
for the year ending 2024
FY23 progress
FY24 enhancements
During FY23, the Board
made progress against
recommendations made in
the 2022 Board Evaluation
including:
During FY24, the Board
will review the 2023 Board
Evaluation results in more
detail, with expected actions
to include:
• annual strategy reviews
• reviewing key Board
• enhanced advance
engagement with
Directors on agenda
topics
• increased input on
regulatory topics
documentation
• enhancing ways of working
with the new Executive
Directors
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT
92
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
93
Health, Safety and Environment (‘HSE’) Committee Report
Remuneration Report
The HSE Committee
formulates, advises on, reviews
and approves the HSE strategy,
ambition and corporate actions
of the Company.”
Trudy Schoolenberg
Chair of the HSE Committee
MEMBERSHIP
Trudy Schoolenberg (Chair of the HSE Committee)
Alexander Wessels
Robert Harris (replaced by Stephen Odell in his
capacity as Executive Chair)
Responsibilities
• Review and approve the HSE framework
(including policy) and strategy of the Company;
• Review and monitor HSE matters arising from the
Company’s activities and operations, including
monitoring performance against targets;
• Review HSE workplans and activities;
• Ensure the Company has appropriate measures in
place that enable it to assess, verify and monitor
its compliance with applicable material HSE laws
and regulations;
• Receive and review regular reports from the
business on key HSE issues and the Company’s
performance in managing any risks associated with
such issues; and
• Oversee any incidents relating to any fatality or
major/serious incident or near-miss.
In exercising its role, the Committee has regard to
the recommendations put forward in the QCA
Corporate Governance Code.
Role of the Committee
The HSE Committee formulates, advises
on, reviews and approves the HSE strategy,
ambition and corporate actions of the Company.
The Committee also, on behalf of the Board,
reviews and monitors HSE matters connected
to the Company’s activities and operations,
endorses HSE policies and procedures and
ensures the Company meets or exceeds HSE
legal obligations.
Key matters discussed during the year
• Review of the Committee’s Terms of
Reference
• Deep dive operational review on the HSE
performance of Accsys controlled sites
• Review of regulatory visits at Accsys’
Arnhem site
Trudy Schoolenberg
Chair of the HSE Committee
26 June 2023
For attendance at HSE Committee meetings
see Directors’ attendance record | Page 81
The Terms of Reference for the HSE Committee
are available on the Company’s website |
www.accsysplc.com/investors/corporate-governance
Our Policy is designed to
be simple and transparent,
aligned with delivering
our purpose led strategy,
and ultimately supporting
the creation of long-term
sustainable shareholder
value. Our aim is to always
consider the wider workforce,
our shareholders, and other
stakeholders by taking a
fair, prudent, and balanced
approach to remuneration.”
Alexander R. Wessels
Chair of the Remuneration Committee
MEMBERSHIP
Alexander Wessels
(Chair of the Remuneration Committee)
Sean Christie
Louis Eperjesi
Sue Farr
Stephen Odell
Trudy Schoolenberg
Whilst Stephen Odell was a member during the period, he stepped down
as a member from 1 April 2023.
On behalf of the Board, I am pleased to
present our Remuneration Report for
the year ended 31 March 2023.
We obtained shareholder approval for
our Directors’ Remuneration Policy at the
2021 AGM, with 99.92% of all votes cast in
favour. Shareholders have shown a similarly
high level of support for our Directors’
Remuneration Report for the year ended
31 March 2022, with 99.94% of votes in
favour. These high levels of support reflect
our responsible approach to executive
pay. Later in FY24 we will be reviewing our
Policy to ensure that it continues to support
strategic priorities under the leadership of
Dr Jelena Arsic van Os as Chief Executive
Officer and Steven Salo as Chief Financial
Officer. We will consult with our shareholders
in advance of the next triennial shareholder
vote on the policy at the 2024 AGM.
For ease of reference, the policy table
summarising the Remuneration Policy
is included on pages 97 to 98. The full
Remuneration Policy is available in the 2021
Annual Report on the Company’s website.
The Annual Report on Remuneration
(on pages 97 to 107) describes how the
Remuneration Policy has been applied for
the year ended 31 March 2023, and how
we intend to implement the Remuneration
Policy for the year ahead. This part of the
report will be subject to an advisory vote
at our AGM.
For attendance at Remuneration Committee meetings
see Directors’ attendance record | Page 81
The Terms of Reference for the Remuneration Committee
are available on the Company’s website |
www.accsysplc.com/investors/corporate-governance
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 94
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Remuneration Report continued
Remuneration in the context of our
business performance and outcomes
for our key stakeholders
As set out in detail in the Executive Chair’s Statement,
Accsys made significant progress in FY23 against a
challenging macro-economic backdrop with significant
input cost inflation and supply chain disruption which
we managed through a careful balance of strong market
demand for our products, higher average sale prices, the
implementation of an Energy Price Premium to mitigate
for higher gas prices and cost discipline. We continue to
make good progress on strategic growth projects with
the Arnhem plant reactor 4 expansion leading to record
volume production in Q4. During the year, we delivered
revenues of €162.0m, a 34% increase on FY22. Underlying
Group EBITDA was €22.9m, an increase of 120% on the
These challenges are naturally having the biggest impact
on people with modest salaries. The Committee was,
therefore, fully supportive of the Board’s decision to make
a one-off cost of living payment in March 2023. Payments
were made to all employees whose base salary fell below
€50,000. A payment of €900 was made to those on
salaries up to €45,000 and a payment of €600 to those
on salaries between €45,000 and €50,000.
Board changes
This year has been one of considerable change with the
departure of Rob Harris, Chief Executive Officer and
William Rudge, Finance Director, from the Board, together
with the appointment of Dr Jelena Arsic van Os as Chief
Executive Officer Designate and Steven Salo as Chief
Financial Officer.
prior year, and ahead of our market guidance of nearly
As announced on 3 August 2022, William Rudge stepped
doubling last year’s Underlying EBITDA of €10.4m.
down from the Board with effect from the close of the
Net debt increased by €16.9m in the year to €44.1m due
to the planned investment into Accoya USA, (€29m),
capex investments of €29.8m into the Arnhem reactor 4
and Tricoya Hull projects (partially offset by a successful
placing in May 2022 which raised net proceeds of
approximately €19.0m), the reduction in the NatWest loan
(€9.4m) and EBITDA generation during the year.
However, the year has not been without its specific
challenges. In November, we announced that, while we
had taken 100% control of the world-first Tricoya plant
AGM on 23 September 2022. His remuneration earned
to that date is included in the table on page 103. He
remained an employee until 1 February 2023 following
which he provided consultancy services to the Group
until 27 April 2023. William Rudge was not eligible to earn
a bonus in respect of FY23 and his LTIP awards, which
were in their performance periods, lapsed when he left
employment. In accordance with the Policy, William Rudge
retained his LTIP award which vested in June 2021 and
was in a holding period until June 2023, and his deferred
bonus award granted in respect of his bonus for FY22
project in Hull, we also put the project into a hold period
which will vest in July 2024 as originally envisaged.
of at least six months to assess future capability and
funding options. Further detail is included in the Executive
Chair’s statement.
Building on our commitment to growing and operating
our business in a responsible and sustainable way, Accsys
participated for a second consecutive year in the S&P
Global Corporate Sustainability Assessment. Accsys
scored 43/100 - an improvement of five points (13%) on
the prior year, placing the Company in the top quintile
in the ‘Paper & Forest Products’ industry category.
During the year, Accoya’s high level of performance and
sustainability was also recognised in various prestigious
global industry awards.
Our growth ambition and progress against our strategic
priorities for growth is set out in our Strategic Report on
pages 28 to 33.
Recognising the cost of living impact on
our people
As announced on 12 December 2022, Robert Harris
stepped down from the Board on 31 March 2023, at
which point his service agreement also came to an end.
Details of his remuneration earned in respect of FY23 are
included in the table on page 102. As he was a Director
for the full financial year ended 31 March 2023, Robert
Harris was eligible to earn a bonus in respect of FY23,
subject to the achievement of the applicable performance
measures. Having regard to his intended departure and
the benefits of an orderly handover, the weightings of
the performance conditions applying to his bonus were
adjusted, with 25% of the overall opportunity (31.25%
of salary) being subject to the achievement of personal
objectives linked to the implementation of the Group’s
strategy. Further details are included on page 103. The
Committee exercised discretion to treat Robert Harris
as a “Good Leaver” for his in-flight LTIP awards, which will
vest subject to the satisfaction of performance conditions
and a pro-rated reduction to reflect his departure from
The Committee has been very mindful of the impact on
the business before the end of the vesting period. To the
our colleagues in relation to inflation and the cost of living
extent the awards vest, they will remain subject to the
challenges during the last year.
originally envisaged post-vesting holding periods.
95
Further information is included on page 105 along with
Buy-out awards
information on certain other payments made to Robert
Harris. Robert Harris retained his deferred bonus award
granted in respect of his bonus for FY22 which will vest in
July 2024 as originally envisaged.
In line with the Policy, we have agreed to make the
following awards to Dr Jelena Arsic van Os in respect
of remuneration at her former employer that she will
forfeit as a result of joining Accsys.
Stephen Odell assumed the role of Executive Chair on an
interim basis with effect from 1 April 2023. Dr. Jelena Arsic
van Os joins the Board on 27 June 2023 and will then take
up the role of Chief Executive Officer with effect from
1 July 2023, at which point Stephen Odell will revert to
Independent Non-Executive Chair. In recognition of the
additional time commitments associated with his interim
role, Stephen Odell will receive a salary during this period
of £26,400 per month. Stephen will not receive any
pension or participate in any incentive pay arrangements
in respect of his period of service as Executive Chair.
When he reverts to the position of Independent Non-
Executive Chair, Stephen’s fee will return to £97,000
per annum.
• A payment of £78,700 in respect of a forfeited bonus
otherwise payable in respect of the former employer’s
financial year ended 31 December 2022. The bonus
will be subject to Accsys’ ordinary clawback rules
and a specific clawback requirement if Jelena gives
voluntary notice of cessation of her employment with
Accsys during her first year of employment.
• An award in respect of forfeited performance shares
which had vested to Jelena. This buy-out award will
be granted in shares to ensure continued alignment
with the interests of Accsys’ shareholders and will be
granted over a number of Accsys shares with a value
equal to the value of the forfeited shares. The award
will be granted as soon as practicable after Jelena
We announced on 24 March and 4 April 2023 respectively
commences employment, and details will be included
the appointment of Steven Salo and Dr Jelena Arsic van
in the FY24 Directors’ Remuneration Report. The
Os as our new Chief Financial Officer and Chief Executive
award will vest on the first anniversary of the date on
Officer Designate respectively. We were delighted to be
which Jelena commences employment with Accsys.
able to appoint new Executive Directors of this calibre.
Jelena’s considerable and relevant experience makes her
a great fit for Accsys and well qualified to lead the business
Incentive outcomes for the year ended
31 March 2023
into the next phase of growth. Steven’s background as
As explained above, William Rudge was not eligible to
an international Group CFO with experience focused
earn a bonus in respect of FY23. Robert Harris’ annual
on driving improvements in financial fundamentals
will be highly beneficial to Accsys as we enter our
next growth phase. Steven joined the business with
bonus opportunity was up to 125% of salary. Details
of the performance conditions are set out on page
103, taking into account the re-weighting described
effect from 1 April 2023. I have summarised below the
above. Reflecting the financial performance over the
remuneration packages for each of Steven and Jelena.
Group in the year and delivery against non-financial
In agreeing these packages, we were cognisant of the
objectives, Robert Harris earned a bonus of 56.875%
need to secure candidates with the required experience.
of the maximum (125% of salary), equivalent to 71.09%
The overall packages were determined having regard to
of salary. 59.3% of salary was paid in cash and 11.8% of
market positioning against companies of a similar size
salary will be delivered in deferred shares to be held for
and complexity, the competitive recruitment market,
two years, strengthening alignment of executive and
and the candidates’ previous remuneration.
shareholder interests.
Chief Executive
Officer Designate
Robert Harris’ LTIP award granted in 2020 was subject
to performance conditions based on EBITDA per
Chief Financial Officer
share in FY23 (60% weighting) and Sales Volume (40%
Salary
Pension
£390,000
£265,000
8% of salary, aligned with other employees in the
business in the UK (or cash in lieu)
Annual Bonus
Up to 125% of salary
LTIP
125% of salary
100% of salary
weighting), measured for three years. Because the
EBITDA threshold and Sales Volume threshold were not
achieved the overall vesting was nil. William Rudge’s LTIP
award granted in 2020 lapsed when he left the business.
Buy-out awards See below
N/A
The Committee considers the incentive outcomes to
Notice period
12 months for the first
6 months
be reflective of the overall performance of the Group
year of employment.
Thereafter 6 months.
during the relevant period and no discretion was
exercised in respect of the outcomes.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 96
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Remuneration Report continued
97
LTIP awards – grant 2022
Context for executive pay
2022 LTIP awards were granted to Robert Harris, William Rudge, and other participants on 11 July 2022. The LTIP
This report is prepared in accordance with the UK regulations for reporting executive pay. Our admission to
awards are nil priced options over Ordinary shares of €0.05 each in the Company. In line with the Remuneration
trading on AIM in the UK and listing on NYSE Euronext in the Netherlands, combined with our UK incorporated
Policy approved at the 2021 AGM, Robert Harris and William Rudge were granted awards of 215,178 and 100,851 shares
status, means that we fall within the definition of a ‘quoted company’ in the UK Companies Act. Accordingly, and
respectively. Further details of the performance conditions are set out on page 103. William Rudge’s award lapsed when
exceptionally amongst AIM companies, we are legally required to comply with the regulations for reporting and
he left the business.
Remuneration – at a glance
We operate a simple and transparent overall structure. The key components and features of our framework are
summarised in the table below.
Salary
• Salaries are normally reviewed annually by the Committee, taking into account relevant factors that may include
individual performance, corporate performance, changes to an individual’s role and responsibilities, and appropriate
market data.
• The salaries for the Executive Directors for FY24 are set out on page 95.
Benefits and
• Benefits consist of private medical insurance and life insurance.
pension
• Pension allowance of 8% of salary, aligned with other employees in the business in the UK.
Annual bonus
• Maximum annual bonus opportunity of 125% of base salary.
• Target opportunity of 62.5% of salary.
• Based on a mix of financial, strategic and operational objectives, with stretching targets.
• 20% deferral into fixed number of shares for two years, strengthening alignment of executive and shareholder
interests. No leaver provisions.
• Malus and clawback provisions apply.
Long-term
incentive plan
• As described above, the LTIP grant for the CEO and the CFO for FY24 will be 125% and 100% of salary respectively.
• The number of shares that vest will be subject to performance measured over a period of three years. Details of the
targets and weightings are set out on page 101. These will be kept under review for future awards.
• Vested awards will be subject to an additional two-year holding period, aligned with best practice for UK-listed and
Dutch companies and in excess of typical practice for AIM-listed companies.
• Malus and clawback provisions apply.
Shareholding
• Executive Directors are expected to build up and retain a shareholding of at least 250% of salary for CEO and 225%
guidelines
of salary for CFO.
Our Policy retains the flexibility to offer incentive award opportunities exceeding those set out above if appropriate
in the circumstances. It retains the discretions for the Committee to provide a maximum bonus opportunity up to the
formal cap of 200% of salary in respect of a particular financial year or to make annual LTIP awards of up to 300%
of salary.
New LTIP
Our existing 2013 Long Term Incentive Plan was approved by shareholders at the 2013 AGM and will reach the end of
its 10-year life in September 2023. At the 2023 AGM we will seek shareholder approval for a new 2023 LTIP, the principal
terms of which will be set out in the Notice of AGM.
2023 AGM
The Remuneration Committee remains committed to operating remuneration arrangements which align with our
strategic priorities and the best interests of our stakeholders. We believe the approach we have adopted
is appropriate and responsible and I look forward to receiving your support at our AGM.
Yours sincerely
Alexander R. Wessels
Chair of the Remuneration Committee
26 June 2023
approval of Directors’ remuneration by companies listed on the main market, including a binding vote on the
Directors’ Remuneration Policy.
Directors’ Remuneration Policy
Our remuneration policy was approved by shareholders at our AGM on 17 September 2021, supported by over 99%
of the votes cast. We have set out below, the policy table. Our full Remuneration Policy is set out in the 2021 Annual
Report available in the Investors section of the Company’s website at www.accsysplc.com.
Element
Purpose and operation
Maximum
Performance measures
Base salary
An appropriate level of fixed remuneration to
There is no prescribed maximum.
N/A
reflect the individual’s skills and experience.
Salaries are normally reviewed annually
by the Committee, taking into account
Any percentage increase to
salaries would normally be in line
with those awarded to the wider
relevant factors that may include: individual
workforce. Larger increases may
performance, corporate performance, changes
be awarded in circumstances
to an individual’s role and responsibilities,
considered appropriate by the
and appropriate market data.
Committee, such as an increase
in the size of the business or
the responsibilities of the role,
or changes in the competitive
marketplace.
Benefits
To provide a market competitive benefits package.
There is no prescribed maximum.
N/A
Benefits may comprise a car allowance, private
The level of benefits is set at an
medical insurance, life insurance and reimbursed
appropriate market rate.
business expenses (including any associated tax
liability) incurred when travelling in performance
of duties.
The Committee may determine that other
benefits be provided where appropriate
(for example – relocation costs).
Pension
Contributions to the Company’s pension scheme,
The maximum level of pension
N/A
or an equivalent cash supplement, is provided.
contribution (or cash allowance in
lieu) for Executive Directors will
be aligned with the contribution
level for the wider workforce in
the relevant country.
Current contributions are 8% of
salary for the Executive Directors.
Annual Incentive
To drive and reward the delivery of business
The current maximum annual
Awards will normally be based
Plan
objectives for the financial year.
opportunity for all Executive
on a combination of financial
The bonus is discretionary and any pay-out
Directors is 125% of salary.
and non-financial goals
is determined by the Committee based on
The Committee retains
performance. Targets are set and assessed
discretion to provide a maximum
opportunity of up to 200% of
salary in respect of a particular
financial year.
by the Committee each year.
Normally no more than 80% of any bonus
will be paid in cash, with the balance paid
in deferred shares.
Deferred shares typically vest after two years
with no further performance conditions.
Malus and clawback and dividend provisions
apply (see notes to the table).
Amounts may be satisfied in cash, or at the
Committee’s discretion, in shares.
measured over one financial
year, with at least 50% of the
maximum annual opportunity
normally assessed against
financial metrics.
The Committee retains
discretion to adjust
performance measures and
targets during the year to take
account of events outside of
management control which were
unforeseen when the measures
and targets were initially set.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 99
Directors’ service contracts
The notice periods under the service contracts of the current Executive Directors are set out in the following table:
Name
Dr Jelena Arsic van Os
Steven Salo
* Reducing to six months after the first year of employment.
Notice period from
individual (months)
Notice period from
Company (months)
12*
6
12*
6
Executive Directors’ service contracts, which do not contain expiry dates, provide that compensation provisions for
termination without notice will include salary, certain fixed benefits, and pension. In the case of both the CEO and
CFO, sums may be paid in instalments and decrease or cease if the individual finds an alternative role.
The Company’s general policy on recruiting a new Executive Director is to provide a service contract terminable
after six months. However the Committee reserves the right to introduce a longer notice period (of up to 12
months) which would reduce to six months over time. Provisions for compensation for termination would normally
follow those described above. Directors’ service contracts are kept available for inspection at the Company’s
registered office.
Outside appointments
Subject to Board approval, Executive Directors are permitted to accept (and retain the fees from) outside
appointments on external boards as long as these are not deemed to interfere with the business of the Group.
Policy Table for Non-Executive Directors (NEDs)
Element
Purpose and operation
Maximum
Performance measures
Chair and NEDs
Fees for the Chair and for the NEDs are set
There is no prescribed maximum
N/A
by the Board (excluding the NEDs).
annual increase or fee level.
Fees are based on the responsibilities and
Fee levels are reviewed on a periodic
time commitment of the role. The Chair
basis, with reference to the time
receives a single fee. NED fees include a base
commitment of the role and market
fee and may include additional fees for other
levels in companies of comparable
Board or Committee duties. Supplementary
size and complexity.
fees may be paid for other responsibilities
or time commitments
Fees are paid in cash. NEDs are not eligible
to participate in incentive arrangements or
receive pension provision or other benefits.
Non-Executive Directors may be reimbursed
for business expenses (and any associated
tax liabilities) incurred when travelling in
performance of duties.
98
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Remuneration Report continued
Element
Purpose and operation
Maximum
Performance measures
Long-term
To reward Executive Directors for the delivery of
For awards made in FY22
Performance targets are
incentive plan
long-term performance and align their interests
onwards, the award will be a
measured over a period of
(LTIP)
with shareholders.
fixed number of shares. In FY22
at least three financial years,
Awards are made under, and subject to the terms
of, the 2013 LTIP approved by shareholders at
the 2013 AGM.
Awards may be in the form of nil or nominal
cost options, or any other form allowed by the
Plan rules. Awards vest over a period of at least
three years, subject to performance. Awards
are subject to an additional holding period
of at least two years following the end of the
three-year performance period.
Clawback and dividend equivalent provisions
apply (see notes to the table).
this fixed number of shares
using performance measures
was equivalent to 125% of
aligned to the delivery of
salary for the former CEO and
the strategy and long-term
100% of salary for the former
shareholder value.
Finance Director.
25% of awards vests for
In future years, for which this
attaining threshold level
policy applies, it was intended
of performance.
that the former Executive
Directors would each be awarded
the same fixed number of shares
as in FY22.
The Committee retains
discretion to use different
or additional performance
measures or weightings to
The fixed number of shares
ensure that awards remain
awarded will be restricted so that
appropriately aligned to
it does not exceed the overall
the business strategy and
maximum LTIP award opportunity.
objectives.
The Committee retains discretion
to make annual awards of up to
Non-financial performance
measures will normally be
300% of salary.
subject to a financial underpin.
Shareholding
To increase long-term alignment between
N/A
guidelines
executives and shareholders. Executive Directors
are expected to build up and retain a beneficial
holding of at least 250% of salary for CEO and
225% of salary for the Finance Director/CFO.
The Committee will
consider the Group’s
overall performance before
determining the final
vesting level.
N/A
Notes to the Policy table:
1. Deferred shares and LTIP awards which vest under this Policy may benefit from the right to receive an amount equal to the value of, if applicable, any dividends
which would have been paid on vested shares up to the time of vesting (or where the award is subject to a holding or deferral period, up to the time of release).
2. The Annual Incentive Plan and LTIP contain malus and clawback provisions in the event of a material misstatement of results, censure by a regulatory authority
or any other serious damage to the Company reputation, or fraud or gross misconduct. The cash and, if applicable, share elements of the Annual Incentive Plan
may be clawed back for a period of three years from the date on which the Annual Incentive Plan payment is made. Awards under the LTIP may be cancelled or
reduced (prior to vesting), or clawed back for a period of three years post vesting.
3. The remuneration framework for other employees is based on broadly consistent principles used to determine the policy for Executive Directors. All Executives
and Senior Managers are generally eligible to participate in some form of annual incentive arrangement. Participation in the LTIP may be extended to
executives, senior managers and other key staff, with LTIP performance conditions generally consistent across all levels. Individual salary and pension levels and
incentive award sizes vary according to the level of seniority and responsibility.
4. The choice of the performance measures applicable to the Annual Incentive Plan reflects the Committee’s view that incentives should be aligned to the Group’s
key annual financial, strategic and ESG objectives. For the LTIP, the measures and targets for the FY24 award are set out at page 101. For both the Annual
Incentive Plan and the LTIP, the Committee sets challenging targets taking into account the Board’s objectives for the business. Performance conditions
may be amended or substituted by the Committee if an event occurs which causes the Committee to determine an amended or substituted performance
condition would be more appropriate and not materially more or less difficult to satisfy. The Committee may use its discretion to adjust payouts under the
Annual Incentive Plan and LTIP to Executive Directors, within the range of the minimum to maximum opportunity, including reducing it down to zero. Such
discretion will only be used where the Committee believes that performance against the prescribed targets does not accurately reflect the Company’s
underlying performance.
5. The Committee reserves the right to make any remuneration payments and/or payments for loss of office (including exercising any discretion available to it in
connection with such payments) notwithstanding that they are not in line with the Policy set out above where the terms of the payment either agreed: (i) prior
to the Policy set out above came into effect; (ii) during the term of, and were consistent with, any previous policy approved by shareholders; or (iii) at a time
when the relevant individual was not a Director of the Company and, in the opinion of the Committee, the payment was not in consideration for the individual
becoming a Director of the Company.
6. The terms of any deferred shares or LTIP shares may be adjusted to take account of a Company reorganisation, such as a variation of capital, rights issue,
demerger or special dividend.
In respect of the shareholding guideline, vested but unexercised LTIP shares and the 20% deferred element of
the Annual Incentive Plan will count towards the guideline (on a net of tax basis). It is anticipated that the level of
shareholding set out in the guideline will normally be met within five years of appointment as an Executive Director
(or from the date that the increased shareholding guideline comes into effect i.e. from the approval of this Policy).
The Committee will take into account LTIP vesting levels and personal circumstances when assessing progress
against the guideline.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 100
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Remuneration Report continued
101
NED contracts
Annual bonus
The NEDs, including the Chair, have letters of appointment which set out their duties and responsibilities. Appointment
For the year ending 31 March 2024, the maximum annual bonus opportunity for each of Dr Jelena Arsic van Os and
is for a fixed term of three years, terminated by three months’ notice on either side.
Name
Stephen Odell1
Sean Christie
Sue Farr
Trudy Schoolenberg
Alexander Wessels
Louis Eperjesi
Notes:
Unexpired term
(months)
36
5
5
9
3
24
1 Stephen Odell is employed subject to the terms of an Executive Chair Service Agreement which is scheduled come to an end on 1 July 2023 when he reverts to
the position of Non-Executive Chair. Dr Jelena Arsic van Os will take up the role of Chief Executive Officer with effect from 1 July 2023.
Consideration of employment conditions elsewhere in the Group
As explained in the general policy section of the Remuneration Policy, the Committee takes into account Group-wide
pay and employment conditions. The Committee reviews the average Group-wide base salary increase and bonus costs
and is responsible for all discretionary and all-employee share arrangements, and major benefits including by reference
to benchmarking data provided by third parties. The Committee did not consult directly with employees in preparing
the Directors’ Remuneration Policy, but feedback on reward policies and/or remuneration is gathered directly or
indirectly through employee surveys and Remuneration Committee discussions about employee value proposition.
Steven Salo will be 125% of salary in accordance with the Policy, pro-rated in the case of Dr Jelena Arsic van Os to
reflect her period of service in the year. 20% of any earned bonus will be deferred in shares for two years. Payouts
will be determined based on the delivery of stretching financial, operational, and personal objectives with the
weightings for the various components as follows:
Name
Group EBITDA
Cash generation
Working capital management
ESG Agenda development
Strategic progress Kingsport
Personal objectives1
Total
Weighting (% of bonus)
CEO
45%
15%
10%
5%
10%
15%
CFO
45%
15%
10%
5%
10%
15%
100%
100%
1 Pay-out under the personal objectives element is subject to an underpin and will be capped at 5% of maximum unless the future capability and funding
options for the Tricoya project in Hull have been resolved to the satisfaction of the Board.
The Committee believes that the underlying targets are commercially sensitive and cannot be disclosed at this
stage. The Committee retains the discretion to award a bonus in excess of 125% (but within the policy limit of 200%)
in the event of exceptional events resulting in significant unexpected value creation for the Group. Stephen Odell
will not participate in a bonus arrangement in respect of FY24.
Consideration of shareholder views
Long-term incentives
The Committee consulted with major shareholders in respect of the development of this Remuneration Policy in 2021.
For FY24 Dr Jelena Arsic van Os and Steven Salo will be granted awards of options at the level of 125% and 100% of
We thank shareholders for their time and input into this process. The feedback received was taken into account in
salary respectively.
finalising the Policy. During each year, the Committee considers shareholder feedback received in relation to the AGM,
along with any additional feedback received through other engagement. The Committee also regularly reviews the
Policy in the context of published shareholder guidelines.
Implementation of the Remuneration Policy for the year ending 31 March 2024
A summary of how the Directors’ Remuneration Policy will be applied during the 2024 financial year is set out below.
Base salary
The base salaries for the Executive Directors (including Stephen Odell while he serves as Executive Chair) are set out in
the letter from the Remuneration Committee Chair on page 93.
As set out in the letter from the Remuneration Committee Chair, the salaries for Dr Jelena Arsic van Os and Steven Salo
from appointment are £390,000 and £265,000 respectively.
Pension arrangements
In accordance with the Policy, Dr Jelena Arsic van Os and Steven Salo will receive pension contributions (or cash
supplements) of 8% of base salary, in line with the pension contribution for wider employees. Stephen Odell will not
participate in a pension arrangement in respect of the period when he is Executive Chair.
The performance conditions are set out below.
Vesting (% of maximum)
Underlying EBITDA per share in FY26
Cumulative Revenue (FY24-FY26)
ESG – Improvement in reporting ratings
Weighting
(% of award)
Threshold
Maximum
45%
45%
10%
25%
18p
€500m
100%
20p
€600m
FY26 S&P score
FY26 S&P score
improves to 49%
improves to 52%
• Vesting is on a straight-line basis between the above points.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
The Committee also has the ability to exercise discretion to make adjustments to the formulaic vesting outcome if
it is not considered to be appropriate taking into account business performance during the performance period
including consideration of strategic progress over the three year performance period.
Stephen Odell will not receive an LTIP award in connection with his interim appointment as Executive Chair.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 102
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Non-Executive Directors
The fees for the Non-Executive Directors (NED) for FY23 and proposed fees for FY24 (to be reviewed during the
course of FY24) are set out in the table below.
Metric
Base NED fee
Additional fees:
Non-UK Resident Non-Executive Director Fee
Senior Independent Director
Committee chairpersonship per Committee
Year ending
March 2024
£45,000
Year ended
March 2023
£45,000
£4,000
£5,400
£5,400
£4,000
£5,400
£5,400
With effect from 17 September 2021, Non-UK resident Non-Executive Directors‘ fees are supplemented by an
additional fee of £4,000 p.a. to take account of the additional time commitment required by non-UK resident
Accsys Non-Executive Directors (including but not limited to travelling to Board meetings).
As described on page 78, Stephen Odell assumed the role of Executive Chair on an interim basis with effect from
1 April 2023. Dr Jelena Arsic van Os will join the Board on 27 June 2023 and take up the role of Chief Executive Officer
with effect from 1 July 2023, at which point Stephen Odell will revert to the position of Independent Non-Executive
Chair and his fee will be £97,000 per annum.
Remuneration received by Directors in the year ended 31 March 2023 (audited)
Directors’ remuneration for the 2023 financial year (and for the 2022 financial year) is shown in the following tables:
Currency
Salary/
Fees
Benefits
in Kind1 Pension3
Total
Fixed
Remuneration
Annual
Bonus
LTIPs
Vested/
Expected
to Vest2
Total
Variable
Remuneration
2023
Total
Remuneration
2023
Total
Remuneration
EUR
Executive Directors
Robert Harris
William Rudge6
Non-Executive Directors
Sean Christie
Sue Farr
Montague John
‘Nick’ Meyer4
Trudy Schoolenberg
Stephen Odell
Alexander Wessels
Louis Eperjesi5
£
£
£
£
£
£
£
£
£
308
85
50
44
36
54
95
54
36
38
1
—
—
—
—
—
—
—
25
7
—
—
—
—
—
—
—
371
93
50
44
36
54
95
54
36
226
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
226
—
—
—
—
—
—
—
—
597
93
50
44
36
54
95
54
36
688
110
57
51
43
62
110
62
41
103
Currency
Salary/
Benefits
Fees in
Kind1 Pension3
Total
Fixed
Remuneration
Annual
Bonus
LTIPs
Vested/
Expected
to Vest2
Total
Variable
Remuneration
2022
Total
Remuneration
2022
Total
Remuneration
EUR
Executive Directors
Robert Harris
William Rudge6
Non-Executive Directors
Sean Christie
Sue Farr
Montague John
‘Nick’ Meyer4
Trudy Schoolenberg
Stephen Odell
Alexander Wessels
£
£
£
£
£
£
£
£
295
173
47
44
42
49
90
47
3
2
—
—
—
—
—
—
23
14
—
—
—
—
—
—
321
189
121
80
47
44
42
49
90
47
—
—
—
—
—
—
—
—
—
—
—
—
—
—
121
80
—
—
—
—
—
—
442
269
47
44
42
49
90
47
519
317
55
52
49
58
106
55
Figures are shown in thousands. Figures are shown in the currency in which the majority of remuneration is received.
The final column converts remuneration into the Company’s reporting currency using the monthly exchange rate
when the costs are incurred.
1 Taxable benefits for the Executive Directors in the year included car allowance, private medical insurance, life insurance. Due to an administrative error
Robert Harris had not received his £10,000 per annum car allowance since joining on 20 November 2019 and therefore received a backdated payment of
£30,000 which is shown in the FY23 single figure.
2 For 2022, none of the 2019 LTIP award vested and for 2023 none of the 2020 LTIP vested.
3 Robert Harris received cash in lieu of pension.
4 Nick Meyer stepped down from the Board following the AGM on 23 September 2022.
5 Louis Eperjesi was appointed to the Board with effect from 14 June 2022.
6 William Rudge stepped down from the Board following the AGM on 23 September 2022 and remained an employee of the Group until 1 February 2023. In the
table above, his remuneration for 2023 is his remuneration earned up to 23 September 2022.
Annual bonus for the year ended 31 March 2023 (audited)
For the year ended 31 March 2023, the maximum annual bonus opportunity for Robert Harris was 125% of salary in
accordance with the Policy. Having regard to his intended departure and the benefits of an orderly handover, the
weightings of the performance conditions applying to his bonus were adjusted, with 25% of the overall opportunity
(31.25% of salary) being subject to the achievement of personal objectives linked to the implementation of the
Group’s strategy. The payout was determined based on performance, taking into account the delivery of stretching
financial and operational objectives with the weightings for the various components as set out in the table below.
William Rudge was not eligible to earn a bonus in respect of the year.
Group scorecard
weightings
Out-turn for Group
scorecard
Weighting as % of
maximum for CEO
Out-turn for CEO
Group Objectives:
Group EBITDA (including Tricoya)
Cash Management
Progression with Hull plant
Raw materials supply
ESG agenda
Strategic progress
45%
15%
15%
10%
5%
10%
22.5%
5%
0%
8%
5%
2%
Sub-total – Group Objectives:
100%
42.5%
Personal Objectives:
Final bonus outcome (% of maximum)
33.75%
11.25%
11.25%
7.50%
3.75%
7.50%
75%
25%
16.88%
3.75%
0%
6.00%
3.75%
1.50%
31.88%
25%
56.88%
The detailed performance targets remain commercially sensitive and cannot be disclosed at this time.
Overall, the bonus outcome was 56.88% of the maximum (125%) equivalent to 71.09% of salary. In line with the
Remuneration Policy 59.3% of salary was paid in cash and 11.8% of salary will be delivered in deferred shares that
would be expected to vest in July 2025. The Committee believes this outcome is an appropriate reflection of
performance against objectives in the year.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 104
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105
LTIP vesting in respect of performance to the year ended 31 March 2023 (audited)
Payments to past Directors and payments for loss of office (audited)
The vesting of the LTIP awards granted on 15 July 2020 was subject to performance conditions as summarised in
William Rudge’s remuneration earned for FY23 to the point at which he stepped down from the Board is included in
the table below by reference to EBITDA (60% weighting) and Sales Volume (40% weighting) performance over
the table on page 102. No payment for loss of office was made to Mr Rudge. Mr Rudge remained an employee until
a three-year period.
Total vesting (% of maximum)
EBITDA per share in FY23
Total Sales Volume
Weighting
(% of award)
60%
40%
Threshold
Stretch
Maximum
Actual
performance
Vesting
(% maximum)
25%
€0.14
70%
€0.19
100%
€0.24
€0.11 per share
90,000m3
105,000m3
112,720m3
63,344m3
0%
0%
0%
• Vesting is on a straight-line basis between points in the schedule. There is no vesting for performance below
the threshold.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
• EBITDA per share targets are set and determined so as to exclude licensing income.
• Sales Volume is defined as combined sales volume (in cubic metres, or equivalent) of Accoya and Tricoya.
1 February 2023 receiving his salary, pension allowance and benefits in the normal way. He continued to provide
consultancy services to the Group for a period following the end of his employment. Mr Rudge retained his LTIP
award over 35,152 shares which vested in June 2021 and is subject to a holding period to June 2023 and his deferred
bonus award over 14,569 shares granted in 2022 which will vest in July 2024.
Robert Harris’ remuneration earned for FY23 is included in the table on page 102. Following the end of FY23, Mr
Harris received a payment of £83,364 in lieu of salary and pension for the balance of his notice period and accrued
but untaken holiday. The Company continued to provide medical insurance and life assurance for three months
following the end of his employment and made a payment of £65,000 in respect of outplacement support and of up
to £3,250 in respect of legal expenses. Mr Harris retained his deferred bonus award over 21,918 shares granted in
2022 which will vest in July 2024. He will also be granted a deferred bonus award in 2023 over shares with a value
of 11.8% of his base salary (£37,550) that would expect to vest in July 2025. Mr Harris also retained the following
LTIP awards, which will vest subject to the satisfaction of the performance conditions and a time based reduction
to reflect the cessation of employment before the end of the vesting period. Each award will remain subject to the
• Vesting of the Sales Volume component will be subject to the achievement of a threshold level of EBITDA.
applicable post-vesting holding period.
Scheme interests awarded during the year (audited)
In line with the Policy, 2022 awards were made to the Executive Directors on 11 July 2022, as set out below.
Type of Award
Basis of
award granted
Face value of award
€000s1
% of maximum vesting for
threshold performance
Robert Harris
Nil cost options
125% of salary
William Rudge2
100% of salary
260
122
25%
25%
Performance period
Three years to 31 March 2025
Three years to 31 March 2025
1 Face value determined using share price determined at grant of €1.21 per share.
2 William Rudge’s award lapsed on 1 February 2023.
The performance targets for these awards are as follows:
Weighting
(% of award)
25%
25%
Threshold
25%
206,000m3
49.60%
Maximum
100%
232,000m3
55.00%
Vesting (% of maximum)
Cumulative Sales Volume 1 (FY23–FY25)
Average Gross Contribution
Relative share price performance compared to
companies in the AIM Index excluding financial
services and natural resources companies –
opening share price based on average price
for the last week of September 2022
40%
Median
Upper quartile
ESG – Improvement in reporting ratings
10%
score over the three year period
score over the three year period
15% improvement in S&P ESG
20% improvement in S&P ESG
• Vesting is on a straight-line basis between the above points.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
Date of grant
23 June 2021
11 July 2022
Number of shares
before time
based reduction
Number of
shares after time
based reduction
End of
performance period
End of
holding period
215,178
215,178
101,612
161,384
31 March 2024
23 June 2026
31 March 2025
11 July 2027
There are no other payments for loss of office or payments to former Directors to be disclosed.
Statement of Directors’ shareholdings and share interests (audited)
Robert Harris
William Rudge
Sean Christie
Sue Farr
Montague John ‘Nick’ Meyer
Stephen Odell
Trudy Schoolenberg
Alexander Wessels
Louis Eperjesi
Shares beneficially held1
as at 31 March 2023 (or if
earlier the date on which
they ceased employment)
109,485
324,075
83,369
35,000
155,489
40,650
44,444
—
—
Vested but
unexercised LTIPs
—
35,153
—
—
—
—
—
—
—
Unvested
LTIP awards2
262,995
—
—
—
—
—
—
—
—
Unvested
Deferred bonus
awards
21,918
14,569
—
—
—
—
—
—
—
1
Includes shares held by connected persons. This includes shares held by William Rudge at the date he left employment which he acquired following his
exercise of LTIP options during the year ended 31 March 2022 over 93,490 shares.
2 Excluding the LTIP granted in July 2020 which has lapsed after year end as disclosed above.
There has been no change in the beneficial holdings of the Directors between the year end and the date of
this report.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 106
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Remuneration Report continued
The unvested LTIP awards consist of 2021 and 2022 LTIP awards. The performance conditions for the 2020 and 2022
awards are summarised in the sections above. The performance conditions for the 2021 award are summarised in the
table below.
2021 LTIP
Vesting (% of maximum)
EBITDA per share in FY24
Cumulative Sales Volume (FY22-FY24)
ESG – Improvement in reporting ratings
Weighting
(% of award)
Threshold
Maximum
60%
30%
10%
25%
€0.15
267,000m3
(see below)
100%
€0.24
297,000m3
(see below)
Further detail on ESG targets:
33% on attaining each of the three-year milestones:
Y1 – Attain investor ESG external rating/score
Y2 – Improve/maintain ESG external rating/score
Y3 – Improve/maintain ESG external rating/score
• Vesting is on a straight-line basis between the above points.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
Relative importance of spend on pay
During the year ended 31 March 2023, the total pay for all Group employees increased by 9% to €18,584,000
(2022: €17,007,000). There were no dividends or share buybacks in either year.
Remuneration for all employees
€18,584,000
€17,007,000
9%
FY23
FY22
Difference as a
percentage vs FY22
Annual percentage change in remuneration of Directors and employees
The following table has been prepared in accordance with the UK reporting regulations.
Name
Salary/fees1
FY20 to FY21
Benefits
Bonus
FY21 to FY22
FY22 to FY23
FY20 to FY21
FY21 to FY22
FY22 to FY23
FY20 to FY21
FY21 to FY22
FY22 to FY23
Chief Executive
remuneration2
Finance Director
Remuneration3
Non-Executive
Chair4
Average
Non-Executive
Director
remuneration5
Average of
all employees
of UK PLC6
(7%)
9%
4%
0%
2%
11%
5%
(43%)
87%
3%
9%
2%
8%
3%
4%
57%
(30%)
N/A
0%
0%
6%
N/A
N/A
N/A
N/A
N/A
N/A
(5%)
7%
3%
N/A
N/A
N/A
N/A
N/A
N/A
(1%)
(13%)
11%
10%
(14%)
37%
14%
(63%)
68%
1 Table above includes a 20% reduction in salary for the Chief Executive, Finance Director and Non-Executive Directors for the period April to July 2021.
For the remaining UK employees below the Senior Management Team, any reduction in salary for the initial COVID-19 period was repaid, therefore the
repayment has been included in the table above.
2 Robert Harris (Chief Executive) was appointed to the Board on 20 November 2019. In the above table, the annual change from FY20 to FY21 for his salary,
benefits and bonus have used annualised FY20 salary, benefits, and bonus awarded amounts to provide an effective year-on-year comparison.
3 William Rudge (Finance Director) resigned from the Board on 23 September 2022. In the above table, the annual change from FY20 to FY21 for his salary
and benefits have used annualised FY23 salary and benefits to provide an effective year on year comparison. As Mr Rudge was not eligible to earn
a bonus for FY23, the percentage change between FY22 and FY23 is not considered a meaningful comparison.
4 Stephen Odell was appointed Chair on 18 September 2020. In the above table, the annual change in FY20 to FY21 is based on his annualised FY20 fees an
effective year on year comparison.
5 Average Non-Executive Director remuneration comparison includes adjustment for annualised salary for Alexander Wessels, who was appointed to the Board
on 18 September 2020 and for Louis Eperjesi who was appointed to the Board on 14 June 2022.
6 The 13% decrease in average UK PLC employee salary between FY21 and FY22 is attributed to the further employee growth of blue collar employees, with lower
salary levels.
107
Performance graph and CEO remuneration
The following graph shows the Company’s performance for the past ten years on the London Stock Exchange AIM
compared with the performance of the FTSE AIM All Share index. The FTSE AIM All Share index has been selected for
this comparison as it is a broad-based index which the Directors believe closely reflects the performance of other
companies with similar characteristics to the Company.
300
250
200
150
100
50
0
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
Accsys TSR index
FTSE AIM All Share index
Since joining in late 2019, the CEO’s total remuneration together with the proportion attributable to bonus or vested
incentives is as set out in the table below:
2014
€’000
2015
€’000
2016
€’000
2017
€’000
2018
€’000
2019
€’000
2020
(P.Clegg)1
€’000
2020
(R.Harris)2
€’000
2021
€’000
2022
€’000
2023
€’000
Total remuneration
% Bonus of Total
% Bonus of Cap
% vested LTIPs of maximum
676
51%
N/A
N/A
783
54%
68%
N/A
613
1,632
36%
33%
N/A
18%
48%
58%
502
32%
28%
N/A
809
26%
36%
50%
477
16%
17%
45%
216
38%
33%
N/A
579
43%
41%
N/A
519
27%
21%
N/A
688
37%
36%
N/A
As no formal cap or maximum bonus existed before 2015, no figure has been disclosed setting out this percentage.
Consideration of matters relating to Directors’ remuneration
The Remuneration Committee consisted of Alexander Wessels (Committee Chair), Stephen Odell, Trudy Schoolenberg,
Sean Christie, Sue Farr, and Louis Eperjesi. All members of the Remuneration Committee (including the Chair on
appointment) are considered to be independent. For the duration of his Executive Chair position, Stephen Odell
was not an Independent NED and did not participate as a member of the Remuneration Committee, although was
invited to attend Remuneration Committee meetings. No individual was present when their own remuneration was
being discussed.
Following appointment in 2018, Deloitte LLP (Deloitte) continues to be engaged as independent adviser to the
Committee. The Committee is satisfied that Deloitte remains independent of the Company and that the advice
provided is impartial and objective. Deloitte is a founding member and signatory of the Code of Conduct for
Remuneration Consultants, details of which can be found at www.remunerationconsultantsgroup.com. Their total
fees for the provision of remuneration services to the Committee during the financial year to 31 March 2023 were
£30,400 (plus VAT).
Statement of voting at general meeting
The AGM held on 17 September 2021 included an ordinary resolution in respect of the approval of the Directors’
Remuneration Report (excluding the Remuneration Policy) for the year ended 31 March 2021. 109,668,788 (98.82%)
votes were cast for the resolution, 1,304,803 against and 54,662 withheld. At the AGM held on 17 September 2021,
an ordinary resolution was also passed in respect of the approval of the Directors’ Remuneration Policy for the year
ended 31 March 2021 100,572,490 (99.92%) votes were cast for the resolution, 81,332 against and 10,374,431 withheld.
At the AGM held on 23 September 2022, an ordinary resolution was passed in respect of the approval of the Directors’
Remuneration Report (excluding the Remuneration Policy) for the year ended 31 March 2022. 112,098,476 (99.94%)
votes were cast for the resolution, 69,452 against and 13,664 withheld.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT
108
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Directors’ Report
for the year ended 31 March 2023
109
The Directors are pleased to present their report
Principal activities
All Directors will stand for election or re-election at
Post balance sheet events
together with the audited consolidated financial
statements for the year ended 31 March 2023.
The principal activities of the Group are the production
and sale of Accoya solid wood and Tricoya wood elements,
The Company has chosen, in accordance with s414C (11)
technology and product development, as well as the
of the Companies Act 2006, to provide disclosures and
licensing of technology for the production and sale of
information in relation to a number of matters which are
Accoya and Tricoya via the Company’s subsidiaries: Titan
covered elsewhere in this Annual Report and Accounts.
Wood Limited, Titan Wood B.V., Titan Wood Technology
The Corporate Governance Report approved by the
B.V., Titan Wood Inc., Accoya Color UK Limited, Tricoya
Board is provided on pages 80 to 81 and the Sustainability
Technologies Limited, Tricoya UK Limited, Accsys
Report on page 56 are incorporated by reference
into this Directors’ Report. The Company elects to
(Accoya USA) Holdings LLC, Accsys USA Holdings Inc
and its joint venture Accoya USA, LLC (collectively the
report under the Quoted Company Alliance Corporate
‘Group’). Manufactured through the Group’s proprietary
Governance Code.
Statutory information
acetylation processes, these products exhibit superior
dimensional stability and durability compared with
alternative natural, treated and modified woods as
Information required to be part of the Directors’ Report
well as more resource intensive man-made materials.
can be found elsewhere in this document, as indicated
in the table below, and is incorporated into this report
A review of the business is set out in the Executive
Chair’s Statement on page 14 and the Business Review
by reference:
Topic
Section of Annual Report
on page 34.
Page
number
Strategic Report
Stakeholder engagement
Stakeholder Engagement
67
• Statement of engagement
with employees
• Statement of engagement
with other business
relationships
The Strategic Report, which can be found on pages 20
to 71, sets out the Group’s strategy, business model, key
performance indicators; and a description of the principal
risks and uncertainties; and the main trends and factors
likely to affect the future development, performance and
Financial instruments
Note 33 of the financial
163
position of the Group’s business.
statements
Greenhouse gas emissions
Sustainability Report
(‘GHG’)
Corporate Governance
Corporate Governance
Statement 2023
Report
Environmental matters
Sustainability Report
Social and community issues
Sustainability Report
Principal risks and
uncertainties
Strategic Report
Research and development
Financial review
Sustainability Report
Financial statements
Charitable donations
Sustainability Report
Directors’ interest in shares
Remuneration Report
62
80
60
64
50
44
56
125
64
105
Registered number: 05534340
Registered office address:
4th Floor, 3 Moorgate Place, London, EC2R 6EA
Incorporated in: England and Wales
Type: Public Limited Company
Accsys Technologies PLC has securities admitted to
trading on London Stock Exchange AIM and listed
and admitted to trading on Euronext Amsterdam.
Board of Directors
The Directors of the Company during the year and up
to the date of signing the financial statements were:
Stephen Odell
Steven Salo (appointed on 1 April 2023)
Susan Jane Mair (known as Sue Farr)
Michael Christie (known as Sean Christie)
Geertrui Schoolenberg (known as Trudy Schoolenberg)
Alexander Wessels
Louis Eperjesi (appointed as a Director on 14 June 2022)
William Rudge (ceased being a Director on
23 September 2022)
Robert Harris (ceased being a Director on 31 March 2023)
Montague John Meyer (ceased being a Director on
23 September 2022)
the 2023 AGM with the exception of Sean Christie
and Sue Farr, who, having attained nine years’ service as
Non-Executive Directors, will be standing down, and
No material events have occurred between the year end
date of 31 March 2023 and the date of this report.
Alexander Wessels, who will be stepping down due to
Share capital
commitments from his other roles.
For more information on the Board of Directors, including their
biographies | See pages 74 to 75
Directors’ indemnities
The Company maintains Directors’ and Officers’ liability
insurance which gives appropriate cover for legal action
brought against its Directors. The policy was in force
throughout the period and at the date of the approval
of these financial statements.
Employment policies
The Group promotes diversity and inclusion with
respect to recruitment and selection, from training and
development, through appraisal and promotion and to
retirement. It is our policy to promote an environment
The Company’s issued share capital comprises Ordinary
shares of €0.05 each which are admitted to trading on
London Stock Exchange AIM and listed and admitted
to trading on Euronext Amsterdam. As at 31 March
2023, the Company’s issued share capital comprised
219,381,693 Ordinary shares.
For more information see note 25 of the financial
statement | See page 157
Share issues
During the year, the Company issued 26,620,371
Ordinary shares as follows:
• In May 2022, 13,793,103 Ordinary shares were issued
to raise gross proceeds of approximately €20 million.
(€19 million less expenses).
free from discrimination, harassment and victimisation,
• In November 2022, 11,875,801 Ordinary shares were
where everyone receives equal treatment regardless
issued as part of the as part of the Tricoya consortium
of gender, race, religion or belief, disability, age, marital
restructure.
status, pregnancy or maternity or sexual orientation.
All decisions relating to employment practices will be
objective, free from bias and based solely upon work
criteria and individual merit.
• Between August 2022 and February 2023, 435,774
Ordinary shares were issued following the exercise of
nil cost options granted under the Company’s 2013
Long Term Incentive Plan (‘LTIP’).
Information on the gender ratio of our employees is
• In February 2023, following the subscription by
available in the Sustainability section on page 64.
employees in the prior year for shares under the
Disabled employees
The Group gives full consideration to applications
for employment from disabled persons when the
requirements of the role can be adequately fulfilled.
Where existing employees become disabled, it is the
Group’s policy to provide continuing employment under
normal terms and conditions whenever possible. More
information regarding our approach to diversity and
inclusion can be found on page 109.
Employee Share Participation Plan (the ‘Plan’), 174,122
shares were issued as ‘Matching Shares’ at nominal
value under the Plan.
• In addition, various employees newly subscribed
under the Plan for 203,906 shares at an acquisition
price of €0.812 per share, with these shares issued to
a Dutch foundation, to be released to the employees
after one year, together with an additional share on
a matched basis (subject to continuing employment
within the Group).
Likely future developments
• In February 2023, a total of 137,665 of shares were
Details of likely future developments can be found in
the section marked ‘Looking ahead’, contained in the
Executive Chair’s Statement on page 16.
Political donations
allotted to the Company’s Employee Benefit Trust
(EBT) in relation to one-off incentivisation awards
for certain employees. The terms of the award to
relevant employees require the shares to be held on
trust by the EBT until July 2023, subject to relevant
There were no political donations made during the year
employees remaining in employment during the
or the previous year.
prior year.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT
110
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Directors’ Report continued
111
Results and dividends
Significant shareholdings
Statement of Directors’ Responsibilities
The consolidated statement of comprehensive income for
So far as the Company is aware (further to formal
The Directors confirm to the best of their knowledge:
the year is set out on page 125.
notification), the following shareholders held legal or
The Directors do not recommend the proposal of a final
dividend in respect of the current year, consistent with
the prior year.
Principal risks and uncertainties
The business, financial condition or results of operations
of the Group could be adversely affected by any of the
risks set out in the Strategic Report. The Group’s systems
of control and protection are designed to help manage
beneficial interests in Ordinary shares of the Company
exceeding 3% as at 31 March 2023:
Shareholder
De Engh B.V.
Number of
Ordinary shares/
voting rights
Percentage
of Ordinary
shares
23,114,360
10.57%
15.78%
4.73%
3.43%
Teslin Participaties Coöperatief U.A.
34,482,422
Janus Henderson Group PLC
10,345,655
INEOS Acetyls Investments Limited
7,500,000
and control risks to an appropriate level rather than to
There are no restrictions in respect of voting rights.
eliminate them.
The Directors consider that the principal risks to
achieving the Group’s objectives are set out in the
Strategic Report.
Health and safety
Health and safety is a priority at all levels of the Group,
in particular taking into account the chemical industry
in which Accsys operates. Group companies have a
responsibility to ensure that all reasonable precautions
are taken to provide and maintain working conditions for
employees and visitors alike, which are safe, healthy and in
Going concern
The Directors have formed a judgement, at the time
of approving the financial statements that there is a
reasonable expectation that the Group has access to
adequate resources to continue in operational existence
for at least the next 12 months. Further details are set out
in note 1 to these financial statements.
Disclosure of information to auditors
Each of the persons who is a Director at the date of the
approval of the Annual Report confirms that:
compliance with statutory requirements and appropriate
• So far as the Director is aware, there is no relevant
codes of practice.
audit information of which the Company’s auditors are
The avoidance of occupational accidents and illnesses is
given a high priority. Detailed policies and procedures
are in place to minimise risks and ensure appropriate
action is understood in the event of an incident. The
Group HSE Director has oversight over health and
safety for the Group and in addition, dedicated health
and safety personnel are retained at the Group’s
manufacturing facilities.
In September 2021, the Board of Directors constituted a
HSE Committee to, amongst other things, review health,
safety and environmental strategy, matters arising from
the Company’s activities and operations and endorse HSE
policies, workplans and activities.
unaware; and
• The Director has taken all the steps that he or
she ought to have taken as a Director in order to
make himself or herself aware of any relevant audit
information and to establish that the Company’s
auditors are aware of that information.
This confirmation is given and should be interpreted in
accordance with the provisions of s418 of the Companies
Act 2006.
Independent auditors
PricewaterhouseCoopers LLP (PwC) has been the
external auditor of the Company since April 2010. The
Company is undertaking a competitive tender process in
respect of the audit for the year ending 31 March 2024.
• The Group financial statements have been prepared
in accordance with international accounting standards
in conformity with the requirements of the Companies
Act 2006 and in accordance with international financial
reporting standards adopted pursuant to Regulation
(EC) No 1606/2002, as it applies in the European Union
and give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Group.
• The Annual Report includes a fair review of the
development and performance of the business and the
financial position of the Group and the Parent Company,
together with a description of the principal risks and
uncertainties that they face.
Amendment of the Articles
The Company’s Articles of Association may only be
amended by a special resolution at a general meeting
of shareholders. No amendments are proposed to
be made to the existing Articles of Association at the
forthcoming AGM.
Approved by the Board and signed on its behalf by:
Nick Hartigan
Company Secretary
26 June 2023
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 113
112
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Statement of Directors’ Responsibilities
in respect of the financial statements
The Directors are responsible for preparing the Annual
• make judgements and accounting estimates that are
Report and the financial statements in accordance with
reasonable and prudent; and
applicable law and regulation.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the
Directors have prepared the Group financial statements
in accordance with UK-adopted international accounting
standards and the Company financial statements in
accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Accounting
Standards, comprising FRS 101 “Reduced Disclosure
Framework”, and applicable law).
The Group has also prepared financial statements
in accordance with international financial reporting
standards adopted pursuant to Regulation (EC) No
1606/2002 as it applies in the European Union and the
Dutch Financial Markets Supervision Act.
Under Company law, Directors must not approve the
financial statements unless they are satisfied that they
give a true and fair view of the state of affairs of the
Group and Company and of the profit or loss of the Group
for that period. In preparing the financial statements, the
Directors are required to:
• select suitable accounting policies and then apply
them consistently;
• state whether applicable UK-adopted international
accounting standards and international financial
• prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
Group and Company will continue in business.
The Directors are responsible for safeguarding the
assets of the Group and Company and hence for taking
reasonable steps for the prevention and detection of
fraud and other irregularities.
The Directors are also responsible for keeping adequate
accounting records that are sufficient to show and explain
the Group’s and Company’s transactions and disclose with
reasonable accuracy at any time the financial position of the
Group and Company and enable them to ensure that the
financial statements comply with the Companies Act 2006.
The Directors are responsible for the maintenance
and integrity of the Company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
The Directors are responsible for presenting the
consolidated financial statements in compliance with
the requirements set out in the Delegated Regulation
2019/815 on European Single Electronic Format
(‘ESEF Regulation’).
Directors’ confirmations
reporting standards adopted pursuant to Regulation
(EC) No 1606/2002 as it applies in the European Union
have been followed for the Group financial statements
The Directors consider that the Annual Report and
accounts, taken as a whole, is fair, balanced and
understandable and provides the information necessary
and United Kingdom Accounting Standards, comprising
for shareholders to assess the Group’s and Company’s
FRS 101 have been followed for the Company financial
position and performance, business model and strategy.
statements, subject to any material departures
disclosed and explained in the financial statements;
Each of the Directors, whose names and functions are
listed in Directors’ Report confirm that, to the best of
their knowledge:
• the Group financial statements, which have been
prepared in accordance with UK-adopted international
accounting standards and international financial
reporting standards adopted pursuant to Regulation
(EC) No 1606/2002 as it applies in the European Union,
give a true and fair view of the assets, liabilities, financial
position and loss of the Group;
• the Company financial statements, which have
been prepared in accordance with United Kingdom
Accounting Standards, comprising FRS 101, give a
true and fair view of the assets, liabilities and financial
position of the Company; and
• the Strategic Report (including but not limited to
the Executive Chair’s statement, Business Review
and Finance Review) includes a fair review of the
development and performance of the business and the
position of the Group and Company, together with a
description of the principal risks and uncertainties that
it faces.
In the case of each Director in office at the date the
Directors’ report is approved:
• so far as the Director is aware, there is no relevant
audit information of which the Group’s and Company’s
auditors are unaware; and
• they have taken all the steps that they ought to have
taken as a Director in order to make themselves aware
of any relevant audit information and to establish that
the Group’s and Company’s auditors are aware of
that information.
FINANCIAL STATEMENTSOVERVIEWGOVERNANCESTRATEGIC REPORT 114
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
115
FINANCIAL
STATEMENTS
Financial Statements
116
Independent Auditors’ Report to the members of
Accsys Technologies PLC
125 Consolidated Statement of Comprehensive Income
126 Consolidated Statement of Financial Position
127 Consolidated Statement of Changes in Equity
128 Consolidated Statement of Cash Flow
129 Notes to the Financial Statements
166 Company Statement of Financial Position
167 Company Statement of Changes in Equity
168 Notes to the Company Financial Statements
Shareholder Information
175 Shareholder Information
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 116
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
117
Independent Auditors’ Report to the members
of Accsys Technologies PLC
Report on the audit of the financial statements
Opinion
In our opinion:
• Accsys Technologies PLC’s Group financial statements and Company financial statements (the “financial statements”)
give a true and fair view of the state of the Group’s and of the Company’s affairs as at 31 March 2023 and of the
Group’s loss and the Group’s cash flows for the year then ended;
• the Group financial statements have been properly prepared in accordance with UK-adopted international
accounting standards as applied in accordance with the provisions of the Companies Act 2006;
• the Company financial statements have been properly prepared in accordance with United Kingdom Generally
Accepted Accounting Practice (United Kingdom Accounting Standards, including FRS 101 “Reduced Disclosure
Framework”, and applicable law); and
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and
the Dutch Financial Markets Supervision Act.
We have audited the financial statements, included within the Annual Report and Financial Statements (the “Annual
Report”), which comprise: the Consolidated and Company statements of financial position as at 31 March 2023; the
Consolidated statement of comprehensive income, the Consolidated statement of cash flow, and the Consolidated
and Company statement of changes in equity for the year then ended; and the notes to the financial statements, which
include a description of the significant accounting policies.
Our opinion is consistent with our reporting to the Audit Committee.
Separate opinion in relation to international financial reporting standards adopted
pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union
As explained in note 1 to the financial statements, the Group, in addition to applying UK-adopted international
accounting standards, has also applied international financial reporting standards adopted pursuant to Regulation (EC)
No 1606/2002 as it applies in the European Union.
In our opinion, the Group financial statements have been properly prepared in accordance with international financial
reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”), International
Standards on Auditing issued by the International Auditing and Assurance Standards Board (“ISAs”) and applicable
law. Our responsibilities under ISAs (UK) and ISAs are further described in the Auditors’ responsibilities for the audit
of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Independence
We remained independent of the Group in accordance with the ethical requirements that are relevant to our audit
of the financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable to listed public interest
entities, and the International Code of Ethics for Professional Accountants (including International Independence
Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code), and we have fulfilled
our other ethical responsibilities in accordance with these requirements.
To the best of our knowledge and belief, we declare that non-audit services prohibited by either the FRC’s Ethical
Standard or Article 5(1) of Regulation (EU) No 537/2014 were not provided.
We have provided no non-audit services to the Company or its controlled undertakings in the period under audit.
Our audit approach
Overview
Audit scope
• We performed full scope audits over three reporting units, audit work over material financial statement line items for four
reporting units including the joint venture entity in North America which cumulatively accounted for 100% (2022: 100%)
of the Group’s revenue.
• The UK based Group audit team maintained regular contact with our component team in the Netherlands throughout
the planning and execution of their work. The audit in respect of the North America subsidiary business was carried
out by the Group team in the UK.
Key audit matters
• Impairment of non-current assets (Group)
• Recoverability of investments in subsidiary undertakings (Company)
Materiality
• Overall Group materiality: 1,600,000 EUR (2022: 1,100,000 EUR) based on 1% of Total Revenue.
• Overall Company materiality: 1,520,000 EUR (2022: 950,000 EUR) based on 1% of Total Assets but capped at 95%
of Group materiality.
• Performance materiality: 1,200,000 EUR (2022: 825,000 EUR) (Group) and 1,140,000 EUR (2022: 712,000 EUR)
(Company).
The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the
financial statements.
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the
audit of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) identified by the auditors, including those which had the greatest effect on:
the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team.
These matters, and any comments we make on the results of our procedures thereon, were addressed in the context of
our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
This is not a complete list of all risks identified by our audit.
Recoverability of investments in subsidiary undertakings (Company) is a new key audit matter this year. Going Concern
& Cost capitalisation, which were key audit matters last year, are no longer included because of the changes to the
business in relation to the hold on construction of the Tricoya plant in Hull has lowered the risk associated with these
areas particularly around going concern. There have been lower amounts of internal cost capitalised this year given the
completion of the work in Arnhem and current hold period for Hull during the year. Otherwise, the key audit matters
below are consistent with last year.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 118
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Independent Auditors’ Report continued
119
Key audit matter
How our audit addressed the key audit matter
How we tailored the audit scope
Impairment of non-current assets (Group)
At 31 March 2023 the Group carried €4.2m of goodwill (2022:
In respect of the impairment charge booked, we assessed the
€4.2m), €6.3m of other intangible assets (2022: €6.6m), and €106.1m
methodology for determining the recoverable amount of the CGUs.
of tangible fixed assets (2022: €176.7m) all of which are material.
We assessed the appropriateness of the discount rate and assumptions
Refer to note 15 & 16. Management is required to perform an annual
applied and assessed the reasonableness of the impairment charge
impairment review of goodwill and perform an impairment assessment
calculated. We satisfied ourselves that it was appropriate. The
when a trigger has been identified in accordance with IAS 36. The
headroom in the Accoya CGU was significant and therefore, our audit
carrying value of non-current assets are contingent on future cash
work primarily focussed on the Tricoya CGU given recent decision
flows of the underlying cash generating units (‘CGUs’) and if there is
to hold the development of the plant. We satisfied ourselves that the
a risk that these cash flows do not meet the Directors’ expectations,
forecasts were reasonable and had been prepared with appropriate
the non-current assets will be impaired. The assessment over the
Board involvement. With the assistance of our valuation experts we
recoverable amount of the underlying CGUs is judgemental and
tested the value-in-use models, including challenging management
includes a number of key assumptions, changes to which could
forecasts and key assumptions particularly around the timing of
result in a materially different outcome. Following management’s
the Hull plant hold period as well as the additional cost required
assessment, an impairment of €86.0m was booked to reduce the
for completion. We also considered other key assumptions such as
carrying value of the Tricoya CGU to its recoverable amount due
production and sales volume, price and discount rate, and found that
to increased uncertainty over the timing and quantum of costs to
these assumptions were reasonable. We assessed the mathematical
complete the Hull Plant. The key assumptions underpinning this
accuracy and integrity of the impairment models and determined
charge included timing of the hold period, discount rate, long term
that the impairment charge had been appropriately calculated. Given
growth rate, production and sales volumes and price. We focussed
the estimation uncertainty inherent in the impairment calculations,
on this area because of the inherent judgement and estimation
the financial statements include a sensitivity analysis (refer to note
uncertainty involved in determining the key assumptions.
16). Having re-performed the sensitivity calculations and considered
whether any other sensitivities might be more appropriate, we are
satisfied that the financial statements adequately disclose the potential
risk of future impairment and reversal. We satisfied ourselves that any
reasonable possible change that results in a material adjustment to the
impairment charge had been considered.
Recoverability of investments in subsidiary undertakings
(Company)
Refer to note 4 in the Parent Company financial statements.
We evaluated management’s assessment and considered the
The Parent Company had €17.4m of investments in subsidiary
consistency with other audit procedures performed. We verified
undertakings. There is a risk that the performance of the subsidiary
that the inputs to the assessment were mathematically accurate and
undertakings is not sufficient to support their carrying value and
compared the carrying value of the investments to the recoverable
the assets may be impaired. As part of their considerations the
amounts determined by the value in use model. Based on our work
Directors compared the carrying amount of the investment to their
we found that the Directors’ view that there was no impairment to
recoverable amount using a value in use model. Having performed
recognise was appropriate.
this assessment, no impairment was recognised.
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the
financial statements as a whole, taking into account the structure of the Group and the Company, the accounting
processes and controls, and the industry in which they operate.
The Group’s accounting process is structured around a central finance function based in the UK. The accounting
records for each of the territories in which the Group operates is managed through the central finance function
except for the Netherlands entity which maintains their own accounting records and controls and reports to the
central finance function through the submission of management reporting packs. We used our component auditor
(PwC Netherlands), who are familiar with the local laws and regulations, to perform an audit of the complete financial
information in respect of the subsidiary. In order to direct and supervise the component audit, the Group engagement
team sent detailed instructions to the local audit team. These included communication of the areas of focus and
other required communications. The consolidation, financial statement disclosures and a number of complex items
were audited by the Group engagement team at the head office. These included the going concern assessment,
share based payments, tax accounting and impairment assessment in respect of non-current assets. Taken together,
these procedures gave us the evidence we needed for our opinion on the financial statements as a whole.
The impact of climate risk on our audit
We made enquiries of management to understand their process to assess the extent of the potential impact of
climate change risks on the Group and its financial statements. We used our knowledge of the Group to consider
the completeness of the risk assessment, giving consideration to both physical and transition risks. Management has
outlined within their Strategic Report their sustainability goals, highlighting a focus on producing sustainable wood
products that are responsibly sourced from certified sustainable, well managed and fast growing forests. This has been
factored into their strategy and future business plans. Whilst the impact of climate change is uncertain there were no
indications that the useful lives of the assets are currently impacted by climate change. We also read the disclosures
made in relation to climate change, in the other information within the Annual Report, and considered their consistency
with the financial statements and our knowledge from our audit.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
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Independent Auditors’ Report continued
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the
nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and
in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:
Overall materiality
1,600,000 EUR (2022: 1,100,000 EUR).
1,520,000 EUR (2022: 950,000 EUR).
Financial statements – Group
Financial statements – Company
How we determined it
1% of Total Revenue
1% of Total Assets but capped at 95% of Group materiality
Rationale for
Given that the business is in a growth stage, revenue
The Company is a non-trading holding Company
benchmark applied
was considered the most appropriate measure to
and accordingly we conclude that total assets is
use and is a generally accepted benchmark.
an appropriate benchmark.
For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group
materiality. The range of materiality allocated across components was 786,000 EUR to 1,520,000 EUR. Certain
components were audited to a local statutory audit materiality that was also less than our overall Group materiality.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of
uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality
in determining the scope of our audit and the nature and extent of our testing of account balances, classes of
transactions and disclosures, for example in determining sample sizes. Our performance materiality was 75%
(2022: 75%) of overall materiality, amounting to 1,200,000 EUR (2022: 825,000 EUR) for the Group financial statements
and 1,140,000 EUR (2022: 712,000 EUR) for the Company financial statements.
In determining the performance materiality, we considered a number of factors – the history of misstatements, risk
assessment and aggregation risk and the effectiveness of controls – and concluded that an amount at the upper end
of our normal range was appropriate.
We agreed with the Audit Committee that we would report to them misstatements identified during our audit above
80,000 EUR (Group audit) (2022: 55,000 EUR) and 76,000 EUR (Company audit) (2022: 40,000 EUR) as well as
misstatements below those amounts that, in our view, warranted reporting for qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors’ assessment of the Group’s and the Company’s ability to continue to adopt the going
concern basis of accounting included:
• Understanding of the approach adopted by management through discussions with appropriate individuals within and
outside the finance function and in particular with the Group CFO.
• Tested the integrity of the model used for the going concern assessment covering the period through to
30 September 2024, by recalculating certain outputs and checking the mathematical accuracy of the formulas within
the model. We also agreed the forecasts used to the FY24 board approved budget, tested the accuracy of the inputs
of the model by agreeing back to source documentation and obtained the loan agreements and recomputed the
financial covenants in the models.
• Discussions with management to understand the status of the Hull Tricoya plant and the decision and ability to delay
any further development of the plant for two years, as well as understanding the recent debt restructure which
reduces liquidity risk in the short term.
• Using our knowledge from the audit and the assessment of management’s ability to forecast accurately, we applied
our own stress test to management’s severe but plausible downside and in particular to the timing and additional
investment in respect of the completion of the Kingsport plant. We considered the potential mitigating actions
included in management’s severe but plausible case and assessed whether those are within management’s control.
121
Based on the work we have performed, we have not identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast significant doubt on the Group’s and the Company’s ability to
continue as a going concern for a period of at least twelve months from when the financial statements are authorised
for issue.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the
Group’s and the Company’s ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and
our auditors’ report thereon. The directors are responsible for the other information. Our opinion on the financial
statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the
extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency
or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement
of the financial statements or a material misstatement of the other information. If, based on the work we have
performed, we conclude that there is a material misstatement of this other information, we are required to report that
fact. We have nothing to report based on these responsibilities.
With respect to the Strategic report and Directors’ Report, we also considered whether the disclosures required by
the UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain
opinions and matters as described below.
Strategic report and Directors’ Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report
and Directors’ Report for the year ended 31 March 2023 is consistent with the financial statements and has been
prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the Group and Company and their environment obtained in the course of
the audit, we did not identify any material misstatements in the Strategic report and Directors’ Report.
Directors’ Remuneration
In our opinion, the part of the Remuneration Report to be audited has been properly prepared in accordance with the
Companies Act 2006.
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of Directors’ Responsibilities, the directors are responsible for the preparation
of the financial statements in accordance with the applicable framework and for being satisfied that they give a true
and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Group’s and the Company’s ability
• We have challenged management on the appropriateness of disclosures within the Annual Report on Page 129 and in
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
note 1 of the Group financial statements and Page 168 and note 1 of the Company financial statements in respect of
basis of accounting unless the directors either intend to liquidate the Group or the Company or to cease operations, or
going concern and are satisfied that they are appropriate.
have no realistic alternative but to do so.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
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Independent Auditors’ Report continued
123
The directors are responsible for presenting and marking up the consolidated financial statements in compliance
As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism
with the requirements set out in the Delegated Regulation 2019/815 on European Single Electronic Format
throughout the audit. We also:
(“ESEF Regulation”).
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
ISAs (UK) and ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
the economic decisions of users taken on the basis of these financial statements.
Group’s and Company’s internal control.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by management.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on
Based on our understanding of the Group and industry, we identified that the principal risks of non-compliance with
laws and regulations related to UK corporate tax legislation, UK employment legislation and equivalent local laws and
regulations applicable to the component team, and we considered the extent to which non-compliance might have a
material effect on the financial statements. We also considered those laws and regulations that have a direct impact
on the financial statements such as Companies Act 2006. We evaluated management’s incentives and opportunities
for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined
that the principal risks were related to posting inappropriate journal entries to achieve desired financial results
and management bias in accounting estimates. The Group engagement team shared this risk assessment with the
component auditors so that they could include appropriate audit procedures in response to such risks in their work.
Audit procedures performed by the Group engagement team and/or component auditors included:
• Gaining an understanding of the legal and regulatory framework applicable to the Group and the industry in which
it operates and considering the risk of acts by the Group which were contrary to applicable laws and regulations,
including fraud. We held discussions with Group management and the Group’s legal counsel,including consideration
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Group’s and Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the
disclosures, and whether the consolidated financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Group and Company to express an opinion on the consolidated financial statements. We are responsible
for the direction, supervision and performance of the Group and Company audit. We remain solely responsible for
our audit opinion.
of known or suspected instances of non-compliance with laws and regulation, that could give rise to a material
We communicate with those charged with governance regarding, among other matters, the planned scope and timing
misstatement in the Group and Company financial statements.
of the audit and significant audit findings, including any significant deficiencies in internal control that we identify
• Challenging assumptions and judgements made by management in its significant accounting estimates,in particular
in relation to the going concern assessment, the refinance of Group finance facilities and impairment of assets.
during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
• We did not identify any key audit matters relating to irregularities, including fraud. We also addressed the risk of
requirements regarding independence, and to communicate with them all relationships and other matters that may
management override of internal controls, including testing journals, and evaluated whether there was evidence of
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or
bias by the directors that represented a risk of material misstatement due to fraud.
safeguards applied.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances
From the matters communicated with those charged with governance, we determine those matters that were of most
of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the
significance in the audit of the consolidated financial statements of the current period and are therefore the key audit
financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about
detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our
misrepresentations, or through collusion.
report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
Our audit testing might include testing complete populations of certain transactions and balances, possibly using
benefits of such communication.
data auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than
It is also our responsibility to assess whether the consolidated financial statements have been prepared, in all material
testing complete populations. We will often seek to target particular items for testing based on their size or risk
respects, in compliance with the requirements laid down in the ESEF Regulation.
characteristics. In other cases, we will use audit sampling to enable us to draw a conclusion about the population
from which the sample is selected.
A further description of our responsibilities for the audit of the financial statements in accordance with ISAs (UK)
is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the Company’s members as a body in
accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these
opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or
into whose hands it may come save where expressly agreed by our prior consent in writing.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 124
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
125
Independent Auditors’ Report continued
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
• we have not obtained all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been
received from branches not visited by us; or
• certain disclosures of Directors’ remuneration specified by law are not made; or
• the Company financial statements and the part of the Remuneration Report to be audited are not in agreement with
the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Appointment
We were appointed by the members on 8 September 2011 to audit the financial statements for the year ended 31 March
2011 and subsequent financial periods. The period of total uninterrupted engagement is 13 years, covering the years
ended 31 March 2011 to 31 March 2023.
Report on other legal and regulatory requirements
We have checked the compliance of the consolidated financial statements of the Company as at 31 March 2023 with the
relevant statutory requirements set out in the ESEF Regulation that are applicable to financial statements. That is, for
the Company:
• The consolidated financial statements are prepared in a valid xHTML format;
• The XBRL markup of the consolidated financial statements uses the core taxonomy and the common rules on markups
specified in the ESEF Regulation.
• In our opinion, the consolidated financial statements of the Company as at 31 March 2023, identified as Accsys
Technologies PLC – Annual Report and Financial Statements 2023, have been prepared, in all material respects,
in compliance with the requirements laid down in the ESEF Regulation.
Jonathan Lambert (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
26 June 2023
Consolidated Statement of Comprehensive Income
for the year ended 31 March 2023
2023
€’000
Note
Underlying
2023
€’000
Exceptional
items and
other
adjustments*
143,493
1,374
329
16,822
162,018
(106,852)
55,166
–
–
–
–
–
–
–
2023
€’000
2022
€’000
Total
Underlying
143,493
105,053
1,374
329
16,822
1,459
416
13,924
162,018
120,852
(106,852)
(84,852)
55,166
36,000
(39,878)
(87,453)
(127,331)
(31,541)
15,288
(87,453)
(72,165)
4,459
–
–
(3,224)
9,350
–
6,126
Accoya wood revenue
Tricoya panel revenue
Licence revenue
Other revenue
Total revenue
Cost of sales
Gross profit
Other operating costs
Operating profit/(loss)
Finance income
Finance expense
3
4
8
9
10
Profit/(Loss) before taxation
Tax expense
11
Profit/(Loss) for the year
Items that may be reclassified to
profit or loss
(Loss)/gain arising on translation of
foreign operations
Gain/(loss) arising on foreign currency
cash flow hedges
Total other comprehensive (loss)/gain
Total comprehensive gain/(loss)
Share of net loss from joint venture
accounted for using the equity method
29
(1,036)
–
(1,036)
11,028
(2,787)
8,241
(78,103)
(67,075)
–
(2,787)
(78,103)
(69,862)
(61)
42
(19)
–
–
–
(61)
42
(19)
153
–
153
for the year
8,222
(78,103)
(69,881)
443
474
Total comprehensive gain/(loss)
for the year is attributable to:
Owners of Accsys Technologies PLC
Non-controlling interests
Total comprehensive gain/(loss)
for the year
Basic profit/(loss) per ordinary share
13
Diluted profit/(loss) per ordinary
9,509
(1,287)
(48,566)
(39,057)
(29,537)
(30,824)
8,222
€0.05
(78,103)
(69,881)
€(0.19)
2,083
(1,640)
443
€0.01
474
–
474
share
13
€0.04
–
€0.01
* See note 5 for details of exceptional items and other adjustments.
The notes on pages 129 to 165 form an integral part of these financial statements.
2022
€’000
Exceptional
items and
other
adjustments*
–
–
–
–
–
–
–
(136)
(136)
–
544
–
408
–
408
–
66
66
–
(2,893)
(261)
1,305
(1,015)
290
2022
€’000
Total
105,053
1,459
416
13,924
120,852
(84,852)
36,000
(31,677)
4,323
–
(2,349)
(261)
1,713
(1,015)
698
153
66
219
917
2,557
(1,640)
917
€0.01
€0.01
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
126
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Consolidated Statement of Financial Position
as at 31 March 2023
Registered Company 05534340
Non-current assets
Intangible assets
Investment accounted for using the equity method
Property, plant and equipment
Right of use assets
Financial asset at fair value through profit or loss
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Corporation tax receivable
Derivative financial instrument
Current liabilities
Trade and other payables
Obligation under lease liabilities
Short term borrowings
Corporation tax payable
Net current assets
Non-current liabilities
Obligation under lease liabilities
Other long term borrowings
Financial guarantee
Financial liability at amortised cost
Net assets
Equity
Share capital
Share premium account
Other reserves
Accumulated loss
Own shares
Foreign currency translation reserve
Capital value attributable to owners of Accsys Technologies PLC
Non-controlling interest in subsidiaries
Total equity
Note
15
29
16
17
18
21
22
30
24
17
30
17
30
32
23
25
26
27
2023
€’000
10,491
30,859
106,051
4,044
–
2022
€’000
10,834
3,216
176,661
4,632
–
151,445
195,343
29,946
18,075
26,593
459
–
20,371
16,934
42,054
435
3
75,073
79,797
(25,896)
(29,880)
(980)
(9,500)
(6,082)
(1,024)
(11,654)
(3,184)
(42,458)
(45,742)
32,615
34,055
(3,755)
(4,193)
(56,420)
(52,335)
–
(1,383)
–
–
(61,558)
(56,528)
122,502
172,870
10,963
250,717
114,743
9,638
223,326
114,701
(254,042)
(210,505)
(8)
129
122,502
–
122,502
(6)
190
137,344
35,526
172,870
The financial statements on pages 125 to 165 were approved by the Board of Directors on 26 June 2023 and signed on
its behalf by
Stephen Odell
Director
Steven Salo
Director
The notes on pages 129 to 165 form an integral part of these financial statements.
127
Consolidated Statement of Changes in Equity
for the year ended 31 March 2023
Share
capital
Ordinary
€000
Share
premium
€000
Other
reserves
€000
Own
Shares
€000
Foreign
currency
translation
reserve
€000
Balance at 01 April 2021
8,466
189,598 114,635
(36)
Profit/(Loss) for the year
Other comprehensive
income for the year
Share based payments
–
–
–
Shares issued
1,172
–
–
–
–
Premium on shares issued
Share issue costs
–
–
35,922
(2,194)
–
66
–
–
–
–
–
–
–
30
–
–
37
–
153
–
–
–
–
Accumulated
Loss
€000
(213,263)
2,338
–
463
(43)
–
–
Balance at 31 March 2022
9,638 223,326
114,701
(6)
190
(210,505)
Total equity
attributable to
equity shareholders
of the Company
€000
99,437
2,338
219
463
1,159
35,922
(2,194)
137,344
Non-Controlling
interests
€000
Total
Equity
€000
37,166
136,603
(1,640)
698
–
–
–
–
–
219
463
1,159
35,922
(2,194)
35,526
172,870
–
(39,038)
(39,038)
(30,824)
(69,862)
Loss for the year
Other comprehensive
gain/(loss) for the year
Share based payments
Shares issued
Premium on shares issued
Share issue costs
Acquisition of subsidiary
shares from non-controlling
–
–
–
731
–
–
–
–
–
–
19,526
(1,086)
interests
594
8,951
–
42
–
–
–
–
–
–
–
–
(2)
–
–
–
(61)
–
–
–
–
–
–
366
(22)
–
–
(4,843)
Balance at 31 March 2023
10,963
250,717
114,743
(8)
129
(254,042)
Share capital is the amount subscribed for shares at nominal value (note 25).
(19)
366
707
19,526
(1,086)
–
–
–
–
–
(19)
366
707
19,526
(1,086)
4,702
122,502
(4,702)
–
–
122,502
Share premium account represents the excess of the amount subscribed for share capital over the nominal value of
these shares, net of share issue expenses. Share issue expenses comprise the costs in respect of the issue by the
Company of new shares.
See note 26 for details concerning Other reserves.
Non-controlling interests relate to the previous investment of various parties into Tricoya Technologies Limited and
Tricoya UK Limited. The Group purchased the remaining shareholding in the Tricoya entities in the year (see notes 27
and 28).
Foreign currency translation reserve arises on the re-translation of the Group’s USA subsidiary’s net assets which are
denominated in a different functional currency, being US dollars.
Accumulated losses represent the cumulative loss of the Group attributable to the owners of the parent.
The notes on pages 129 to 165 form an integral part of these financial statements.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
128
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Consolidated Statement of Cash Flow
for the year ended 31 March 2023
(Loss)/ profit before taxation
Adjustments for:
Amortisation of intangible assets
Depreciation of property, plant and equipment, and right of use assets
Impairment loss
Net finance (income)/expense
Equity-settled share-based payment expenses
Accsys portion of Licence fee received from joint venture
Share of net loss of joint venture
Currency translation gains
Cash inflows from operating activities before changes in working capital
(Increase) in trade and other receivables
(Decrease) in deferred income
(Increase) in inventories
Increase in trade and other payables
Net cash from operating activities before tax
Tax received
Net cash from operating activities
Cash flows from investing activities
Interest received
Investment in property, plant and equipment
Foreign exchange deal settlement related to hedging of Hull Capex
Investment in intangible assets
Investment in joint venture
Net cash (used in) investing activities
Cash flows from financing activities
Proceeds from loans
Other finance costs
Interest Paid
Repayment of lease liabilities
Repayment of loans/rolled up interest
Proceeds from issue of share capital
Share issue costs
Net cash from financing activities
Net decrease in cash and cash equivalents
Effect of exchange rate changes on cash and cash equivalents
Opening cash and cash equivalents
Closing cash and cash equivalents
The notes on pages 129 to 165 form an integral part of these financial statements.
2023
€’000
(67,075)
780
7,512
86,000
(6,126)
366
300
1,036
(70)
22,723
(1,154)
–
(9,596)
4,673
16,646
87
16,733
2022
€’000
1,713
745
5,419
–
2,350
463
600
261
(171)
11,380
(5,058)
(33)
(8,110)
4,034
2,213
56
2,269
–
–
(29,773)
(44,612)
(81)
(437)
190
(714)
(28,979)
(3,751)
(59,270)
(48,887)
10,000
54,500
(250)
(2,429)
(940)
–
20,258
(1,086)
25,553
(16,984)
1,523
42,054
26,593
(392)
(2,241)
(1,089)
(46,939)
37,094
(2,194)
38,739
(7,879)
2,335
47,598
42,054
129
Notes to the Financial Statements
for the year ended 31 March 2023
1. Accounting Policies
Basis of accounting
The Group’s financial statements have been prepared under the historical cost convention (except for certain financial
instruments and equity investments which are measured at fair value), in accordance with UK-adopted international
accounting standards and with the requirements of the Companies Act 2006 as applicable to companies reporting
under those standards. In addition, the financial statements are also prepared in accordance with international financial
reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union and the
Dutch Financial Markets Supervision Act.
Going Concern
These consolidated financial statements are prepared on a going concern basis, which assumes that the Group will
continue in operational existence for the foreseeable future, and at least 12 months from the date these financial
statements are approved.
As part of the Group’s going concern review, the Directors have assessed the Group’s trading forecasts, working
capital requirements and covenant compliance for the foreseeable future under a base case scenario, taking into
account the Group’s financial resources including the current cash position and banking and finance facilities which are
currently in place (see note 30 for details of these facilities). The Directors have also assessed a severe but plausible
downside scenario with reduced sales volumes and lower gross margin, also reflecting the possible impact of volatile
raw material costs.
These forecasts indicate that, in order to continue as a going concern, the Group is dependent on achieving certain
operating performance measures relating to the production and sales of Accoya wood from the plant in Arnhem with
the collection of on-going working capital items in line with internally agreed budgets. In both scenarios, the Directors
have assumed no commitment will be made to complete the construction and start-up of the Tricoya plant in Hull until
appropriate funding arrangements have been put in place.
The Directors’ have taken into account the reorganisation of the Tricoya consortium and restructuring of its bank
debt completed in November 2022 which resulted in Accsys becoming the 100% owner of the Tricoya Hull plant and
the commitment to fund ongoing working capital during the hold period. The Directors’ have also considered the
possible amount and timing of capital expenditure required to complete the Accoya plant in the USA, noting that
notwithstanding that the construction project benefits from certain contractual measures in place with the lead
construction contractor, Accsys has committed to fund its 60% share of cost overruns, should they arise.
The Directors believe there are a sufficient number of alternative actions and measures within the control of the
Group that can and would be taken in order to ensure on-going liquidity including reducing/deferring costs in some
discretionary areas as well as larger capital projects if necessary. The Directors believe that while some uncertainty
always inherently remains in achieving the budget, in particular in relation to market conditions outside of the Group’s
control, under both the base scenario and severe but plausible downside scenario, there is sufficient liquidity and
covenant headroom such that there is no material uncertainty with respect to going concern and have prepared the
financial statements on this basis.
Exceptional Items
Exceptional items are events or transactions that fall outside the ordinary activities of the Group and which by
virtue of their size or incidence, have been separately disclosed in order to improve a reader’s understanding of the
financial statements. These include items relating to the restructuring of a significant part of the Group, impairment
losses (or the reversal of previously recorded exceptional impairments), expenditure relating to the integration and
implementation of significant acquisitions and other one-off events or transactions, such as re-financing of Group
borrowings. See note 5 for details of exceptional items.
Business combinations
Where the Company has the power, either directly or indirectly, to govern the financial and operating policies of
another entity or business so as to obtain benefits from its activities, it is classified as a subsidiary. The consolidated
financial statements present the results of the Group as if they formed a single entity. Inter-Company transactions and
balances between Group companies are therefore eliminated in full.
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131
Notes to the Financial Statements continued
for the year ended 31 March 2023
1. Accounting Policies continued
Business combinations continued
The consolidated financial statements incorporate the results of business combinations using the purchase method.
In the consolidated statement of financial position, the acquirer’s identifiable assets, liabilities, and contingent liabilities
are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the
consolidated statement of comprehensive income from the date on which control is obtained.
As allowed under IFRS 1, some business combinations effected prior to transition to IFRS, were accounted for using the
merger method of accounting. Under this method, assets and liabilities are included in the consolidation at their book
values, not fair values, and any differences between the cost of investment and net assets acquired were taken to the
merger reserve. The majority of the merger reserve arose from a corporate restructuring in the year ended 31 March
2006 which introduced Accsys Technologies PLC as the new holding Company.
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with
equity owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of
the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between
the amount of the adjustment to non-controlling interests and any consideration paid or received is recognised within
equity attributable to Accsys Technologies PLC.
When the Group ceases to consolidate or equity account for an investment because of a loss of control, joint control
or significant influence, any retained interest in the entity is remeasured to its fair value, with the change in carrying
amount recognised in profit or loss.
Revenue from contracts with customers
Revenue is measured at the fair value of the consideration receivable. Revenue is recognised to the extent that it is
Where the funds used to finance a project form part of general borrowings, the amount capitalised is calculated using
a weighted average of rates applicable to relevant general borrowings of the Group during the construction period.
The capitalisation of borrowing costs is suspended during extended periods in which it suspends active development
of a qualifying asset.
Share based payments
The Company awards nil cost options to acquire ordinary shares in the capital of the Company to certain Directors
and employees. The Company has also previously awarded bonuses to certain employees in the form of the award of
deferred shares of the Company.
In addition the Company has established an Employee Share Participation Plan under which employees subscribe
for new shares which are held by a trust for the benefit of the subscribing employees. The shares are released to
employees after one year, together with an additional, matching share on a 1 for 1 basis.
The fair value of options and deferred shares granted are recognised as an employee expense with a corresponding
increase in equity. The fair value is measured at grant date and is charged to the consolidated statement of comprehensive
income over the vesting period during which the employees become unconditionally entitled to the options or shares.
The fair value of share options granted is measured using a modified Black Scholes model, taking into account the
terms and conditions upon which the options were granted. The amount recognised as an expense is adjusted to
reflect the actual number of share options that vest only where vesting is dependent upon the satisfaction of service
and non-market vesting conditions.
Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest
at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on
the number of options which eventually vest. Market vesting conditions are factored into the fair value of the options
highly probable that a significant reversal will not occur based on the consideration in the contract. The following
granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
specific recognition criteria must also be met before revenue is recognised.
Manufacturing revenue
Revenue is recognised from the sale of goods at a point in time and is measured at the amount of the transaction price
received in exchange for transferring goods. The transaction price is the expected consideration to be received, to the
extent that it is highly probable that there will not be a significant reversal of revenue in the future. Revenue is recognised
when the Group’s performance obligations under the relevant customer contract have been satisfied. Manufacturing
revenue includes the sale of Accoya wood, Tricoya panels and other revenue, principally relating to the sale of acetic acid.
Dividends
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid.
Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
Pensions
The Group contributes to certain defined contribution pension and employee benefit schemes on behalf of its
employees. These costs are charged to the consolidated statement of comprehensive income on an accruals basis.
Licensing fees
Taxation
Licence fees are recognised over the period of the relevant agreements according to the specific terms of each
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the consolidated
agreement or the quantities and/or values of the licensed product sold. The accounting policy for the recognition of
statement of comprehensive income except to the extent that it relates to items recognised directly in equity, in which
licence fees is based upon satisfaction of the performance obligations set out in the contract such as an assessment of
case it is recognised in equity.
the work required before the licence is signed and subsequently during the design, construction and commissioning of
the licensees’ plant, with an appropriate proportion of the fee recognised upon signing and the balance recognised as
the project progresses to completion. The amount of any cash received but not recognised as income is included in the
financial statements as deferred income and shown as a liability.
Finance income
Interest accrues using the effective interest method, i.e. the rate that discounts estimated future cash receipts
through the expected life of the financial instrument to the net carrying amount of the financial asset.
Finance expenses and borrowing costs
Finance expenses include the fees, interest and other finance charges associated with the Group’s loan notes, credit
facilities and leases, which are expensed over the period that the Group has access to the loans, facilities and leases.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively
enacted at the reporting date together with any adjustment to tax payable in respect of previous years. Current tax
includes the expected impact of claims submitted by the Group to tax authorities in respect of enhanced tax relief for
expenditure on research and development.
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for:
• the initial recognition of goodwill;
• the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a
business combination;
• differences relating to investments in subsidiaries to the extent that they will probably not reverse in the
Foreign exchange gains or losses on the loan notes are included within finance expenses.
foreseeable future.
Interest on borrowings directly relating to the construction or production of qualifying assets are capitalised until such
time as the assets are substantially ready for their intended use or sale. Where funds have been borrowed specifically
to finance a project, the amount capitalised represents the actual borrowing costs incurred.
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying
amount of assets and liabilities, using tax rates enacted or substantively enacted at the reporting date. Recognition
of deferred tax assets is restricted to the extent that it is probable that future taxable profits will be available against
which the temporary differences can be utilised.
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
1. Accounting Policies continued
Foreign currencies
The individual financial statements of each Group Company are presented in the currency of the primary economic
environment in which it operates (the functional currency). For the purposes of the consolidated financial statements,
the results and financial position of each Group Company are expressed in Euro, which is the functional currency of the
parent Company, and the presentation currency of the consolidated financial statements.
In preparing the financial statements of the individual companies, transactions in currencies other than the entity’s
functional currencies are recognised at the rates of exchange prevailing on the date of the transactions. At each
reporting date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates
prevailing at that date. Non-monetary items that are measured in terms of historical cost in a foreign currency are
not retranslated.
Exchange differences are recognised in profit or loss in the period in which they arise.
133
Joint venture
The Group has entered into a joint venture agreement with Eastman Chemical Company, forming Accoya USA LLC. The
Group applies IFRS 11 for this joint arrangement, and following assessment of the nature of this joint arrangement, has
determined it to be a joint venture. Interest in the joint venture is accounted for using the equity method, after initially
being recognised at cost.
Further details concerning the Accoya USA LLC joint venture with Eastman Chemical Company are included in note 29.
Other intangible assets
Intellectual property rights, including patents, which cover a portfolio of novel processes and products, are shown in
the financial statements at cost less accumulated amortisation and any amounts by which the carrying value is assessed
during an annual review to have been impaired. At present, the useful economic life of the intellectual property is
considered to be 20 years.
Internal development costs are incurred as part of the Group’s activities including new processes, process
For the purposes of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign
improvements, identifying new species and improving the Group’s existing products. Research costs are expensed
operations are translated at exchange rates prevailing on the reporting date. Income and expense items are translated
as incurred. Development costs are capitalised when all of the criteria set out in IAS 38 ‘Intangible Assets’ (including
at the average monthly exchange rates prevailing in the month in which the transaction took place. Exchange
criteria concerning technical feasibility, ability and intention to use or sell, ability to generate future economic benefits,
differences arising, if any, are recognised in other comprehensive income and accumulated in the foreign currency
ability to complete the development and ability to reliably measure the expenditure) have been met. These internal
translation reserve. Such translation differences are reclassified to profit and loss only on disposal or partial disposal
development costs are amortised on a straight line basis over their useful economic life, between 8 and 20 years.
of the overseas operation.
Foreign exchange hedging
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any impairment charged. Cost
The Group has adopted IFRS 9 hedge accounting in respect of the cash flow hedging instruments that it uses to
includes the original purchase price of the asset as well as costs of bringing the asset to the working condition and
manage the risk of foreign exchange movements impacting on future cash flows and profitability.
location of its intended use. The capitalisation of costs is suspended during extended periods in which it suspends
The Group has prospectively assessed the effectiveness of its cash flow hedging using the ‘hedge ratio’ of quantities
of cash held in the same currency as future foreign exchange cash flow quantities related to committed investment in
plant and equipment. The Group has undertaken a qualitative analysis to confirm that an ‘economic relationship’ exists
active development of a qualifying asset. Depreciation is provided at rates calculated to write off the cost less
estimated residual value of each asset, except freehold land, over its expected useful life on a straight line basis,
as follows:
between the hedging instrument and the hedged item. It is also satisfied that credit risk will not dominate the value
Plant and machinery
These assets comprise pilot plants and production facilities. These facilities are depreciated
changes that result from that economic relationship.
from the date they become available for use over their useful lives of between 5 and 20 years
At the end of each reporting period the Group measures the effectiveness of its cash flow hedging and recognises the
Office equipment
Useful life of between 3 and 5 years
effective cash flow hedge results in Other Comprehensive Income and the Hedging Effectiveness Reserve within Equity,
together with its ineffective hedge results in Profit and Loss. Amounts are reclassified from the Hedging Effectiveness
Reserve to property, plant and equipment once construction has been completed or Profit and Loss when the
associated hedged transaction affects Profit and Loss. Further details are included in note 5.
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be
received and the Group will comply with the attached conditions. When the grant relates to an expense item, it
is recognised as income over the period necessary to match the grant on a systematic basis to the costs that it is
intended to compensate. Where the grant relates to an asset they are credited to a deferred income account and
released to the statement of comprehensive income over the expected useful life of the relevant asset on a straight
line basis.
Goodwill
Goodwill arising on the acquisition of a subsidiary undertaking is the difference between the fair value of the
consideration paid and the fair value of the identifiable assets and liabilities acquired. It is capitalised, and is subject
to annual impairment reviews by the Directors. Any impairment arising is charged to the consolidated statement of
comprehensive income. Where the fair value of the identifiable assets and liabilities acquired is greater than the fair
value of consideration paid, the resulting amount is treated as a gain on a bargain purchase and is recognised in the
consolidated statement of comprehensive income.
Leased land and buildings Land held under a finance lease is depreciated over the life of the lease
Freehold land
Freehold land is not depreciated
Impairment of non-financial assets
The carrying amount of non-current non-financial assets of the Group is compared to the recoverable amount of the
assets whenever events or changes in circumstances indicate that the net book value may not be recoverable, or in
the case of goodwill, annually. The recoverable amount is the higher of value in use and the fair value less cost to sell.
In assessing the value in use, the expected future cash flows from the assets are determined by applying a discount
rate to the anticipated pre-tax future cash flows. An impairment charge is recognised in the consolidated statement
of comprehensive income to the extent that the carrying amount exceeds the assets’ recoverable amount. The revised
carrying amounts are amortised or depreciated in line with Group accounting policies. A previously recognised
impairment loss, other than on goodwill, is reversed if the recoverable amount increases as a result of a reversal of
the conditions that originally resulted in the impairment. This reversal is recognised in the consolidated statement of
comprehensive income and is limited to the carrying amount that would have been determined, net of depreciation,
had no impairment loss been recognised in prior years. Assets are Grouped at the lowest levels for which there are
separately identifiable cash flows (cash generating units) for purposes of assessing impairment.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
134
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
135
Notes to the Financial Statements continued
for the year ended 31 March 2023
1. Accounting Policies continued
Leases
To the extent that a right-of-control exists over an asset subject to a lease, a right-of-use asset, representing the
Group’s right to use the underlying leased asset, and a lease liability, representing the Group’s obligation to make lease
payments, are recognised in the consolidated statement of financial position at the commencement of the lease.
The right-of-use asset is measured initially at cost and includes the amount of initial measurement of the lease liability,
any initial direct costs incurred, including advance lease payments, and an estimate of the dismantling, removal and
restoration costs required in terms of the lease. Depreciation is charged to the consolidated income statement so as
to depreciate the right-of-use asset from the commencement date to the earlier of the end of the useful life of the
right-of-use asset or the end of the lease term. The lease term shall include the period of an extension option where it
is reasonably certain that the option will be exercised. Where the lease contains a purchase option the asset is written
off over the useful life of the asset when it is reasonably certain that the purchase option will be exercised.
The lease liability is measured at the present value of the future lease payments, including variable lease payments that
depend on an index and the exercise price of purchase options where it is reasonably certain that the option will be
exercised, discounted using the interest rate implicit in the lease, if readily determinable. If the implicit interest rate
cannot be readily determined, the lessee’s incremental borrowing rate is used. Finance charges are recognised in the
consolidated statement of comprehensive income over the period of the lease.
Lease expenses for leases with a duration of one year or less and low-value assets are not recognised in the
consolidated statement of financial position, and are charged to the consolidated income statement when incurred.
Low-value assets are determined based on quantitative criteria.
The Group has used the following practical expedients permitted by the standard:
• The use of a single discount rate to a portfolio of leases with reasonably similar characteristics
• Reliance on previous assessments on whether leases are onerous
• The use of hindsight in determining the lease term where the contract contains options to extend or terminate
the lease.
Inventories
Financial assets
Financial assets and financial liabilities are recognised in the Group’s consolidated statement of financial position when
the Group becomes party to the contractual provisions of the instrument.
Financial assets are initially measured at fair value and in the case of investments not at fair value through profit or loss,
fair value plus directly attributable transaction costs.
Except where a reliable fair value cannot be obtained, unlisted shares held by the Group are classified as fair value
through other comprehensive income and are stated at fair value. Gains and losses arising from changes in fair value
are recognised directly in other comprehensive income, with dividends recognised in profit or loss. Where it is not
possible to obtain a reliable fair value, these investments are held at cost less provision for impairment.
Loans and receivables, which comprise non-derivative financial assets with fixed and determinable payments that are
not quoted on an active market, are initially recognised at fair value plus transaction costs that are directly attributable
to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method,
less provision for impairment.
Trade and other receivables
Trade receivables are initially recognised at fair value and are subsequently measured at amortised cost using the
effective interest rate method, less allowance for impairments. The Group has elected to apply the IFRS 9 practical
expedient option to measure the value of its trade receivables at transaction price, as they do not contain a significant
financing element. The Group applies IFRS 9’s ‘simplified’ approach that requires companies to recognise the lifetime
expected losses on its trade receivables. At the date of initial recognition, the credit losses expected to arise over the
lifetime of a trade receivable are recognised as an impairment and are adjusted, over the lifetime of the receivable, to
reflect objective evidence reflecting whether the Group will not be able to collect its debts.
Cash and cash equivalents
Cash and cash equivalents in the consolidated statement of financial position comprise cash at bank and in hand and
short-term deposits, including liquidity funds, with an original maturity of three months or less. For the purpose of the
statement of consolidated cash flow, cash and cash equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts. Cash and cash equivalents includes cash pledged to ABN Amro as collateral for the
$20million Letter of Credit provided to FHB. See note 30.
Raw materials, which consist of unprocessed timber and chemicals used in manufacturing operations, are valued at the
lower of cost and net realisable value. The basis on which cost is derived is a first-in, first-out basis.
Financial liabilities
Other financial liabilities
Finished goods, comprising processed timber, are stated at the lower of weighted average cost of production or
net realisable value. Costs include direct materials, direct labour costs and production overheads (excluding the
depreciation/depletion of relevant property and plant and equipment) absorbed at an appropriate level of capacity
utilisation. Net realisable value represents the estimated selling price less all expected costs to completion and costs
to be incurred in selling and distribution.
Fair value measurement
Trade payables and other financial liabilities are initially recognised at fair value and subsequently carried at amortised
cost using the effective interest method.
Loans and other borrowings are initially recognised at the fair value of amounts received net of transaction costs and
subsequently measured at amortised cost using the effective interest method.
Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled
or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred
Assets and liabilities that are measured at fair value, or where the fair value of financial instruments has been disclosed
to another party and the consideration paid, including any noncash assets transferred or liabilities assumed, is
in notes to the financial statements, are based on the following fair value measurement hierarchy:
recognised in profit or loss as other income or finance costs.
• level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities;
Financial guarantee contracts
• level 2 – inputs other than quoted prices included within level 1 that are observable for the asset or liability, either
directly (that is, as prices) or indirectly (that is, derived from prices); and
Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued.
The liability is initially measured at fair value, which is determined based on the present value of the difference in cash
• level 3 – inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).
flows between the contractual payments required under the FHB borrowing (provided to the Company’s joint venture
Specific valuation methodologies used to value financial instruments include:
– Accoya USA) and the payments that are estimated to be required without the guarantee being provided by Accsys to
FHB. To calculate the fair value of the guarantee, the present value calculation is then weighted by the probability of the
• the fair values of foreign exchange contracts are calculated as the present value of expected future cash flows based
guarantee being called by FHB.
on observable yield curves and exchange rates; and
• other techniques, including discounted cash flow analysis, are used to determine the fair values of other financial
instruments
Where guarantees in relation to loans or other payables of associates are provided for no compensation, the fair values
are accounted for as contributions and recognised as part of the cost of the investment.
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
1. Accounting Policies continued
Share capital
Financial instruments issued by the Group are treated as equity only to the extent that they do not meet the definition
of a financial liability. The Group’s shares are classified as equity instruments.
Segmental Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Executive
Officer. The Chief Executive Officer is responsible for allocating resources and assessing performance of the operating
segments and has been identified as steering the committee that makes strategic decisions.
Alternative Performance Measures
The Group presents certain measures of financial performance, position or cash flows in the Annual Report and financial
statements that are not defined or specified according to IFRS (International financial reporting standards). These
measures, referred to as Alternative Performance Measures (APMs), are prepared on a consistent basis for all periods
presented in this report.
The most significant APMs are:
Net debt
A measure comprising short term and long-term borrowings (including lease obligations) less cash and cash
equivalents. Net debt provides a measure of the Group’s net indebtedness or overall leverage.
Underlying EBITDA
Operating profit/(loss) before Exceptional items and other adjustments, depreciation and amortisation and includes
the Group’s attributable share of our USA joint venture’s underlying EBITDA. Underlying EBITDA provides a measure
of the cash-generating ability of the business that is comparable from year to year.
Underlying EBIT
Operating profit/(loss) before Exceptional items and other adjustments and includes the Group’s attributable share
of our USA joint venture’s underlying EBIT. Underlying EBIT provides a measure of the operating performance that is
comparable from year to year.
Net Debt/Underlying EBITDA
137
2. Accounting judgements and estimates
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances.
Accounting estimates
Goodwill
The Group tests annually whether goodwill has suffered any impairment in accordance with the accounting policy stated
above. The recoverable amounts of cash-generating units have been determined based on value in use calculations.
These calculations require the use of judgements in relation to discount rates and future forecasts (See note 15 & 16).
The recoverability of these balances is dependent upon the level of future licence fees and manufacturing revenues.
While the scope and timing of the production facilities to be built under the Group’s existing and future agreements
remains uncertain, the Directors remain confident that revenue from own manufacturing, existing licensees, new
licence or consortium agreements will be generated, demonstrating the recoverability of these balances.
Intellectual property rights (IPR) and property, plant and equipment
The Group tests the carrying amount of the intellectual property rights and property, plant and equipment whenever
events or changes in circumstances indicate that the net book value may not be recoverable. These calculations require
the use of estimates in respect of future cash flows from the assets by applying a discount rate to the anticipated
pre-tax future cash flows. Within this process, the Group makes a number of key assumptions including operating
margins, production volumes, discount rates, terminal growth rates and forecast cash flows. Additional information is
disclosed in note 15 & 16, which highlights the estimates applied in the value-in-use calculations for those CGUs that
are considered most susceptible to changes in key assumptions and the sensitivity of these estimates. The Group also
reviews the estimated useful lives at the end of each annual reporting period (See note 15 & 16). The price of Accoya
wood and the raw materials and other inputs vary according to market conditions outside of the Group’s control.
Should the price of the raw materials increase greater than the sales price or in a way which no longer makes Accoya
competitive, then the carrying value of the property, plant and equipment or IPR may be in doubt and become impaired.
The Directors consider that the current market and best estimates of future prices mean that this risk is limited.
Valuation of value recovery instrument (“VRI”)
These calculations require the use of estimates in respect of future cash flows and by applying a discount rate to the
anticipated future cash flows. The same future cashflows modelled in Property, plant and equipment testing are used
Net debt divided by trailing 12-month underlying EBITDA. A measure of the Group’s net indebtedness relative to its
for this calculation. Additional information is disclosed in note 16 & 23.
cash-generating ability.
Accoya Manufacturing margin
Accoya segmental underlying gross profit excluding Accoya underlying licence revenue and marketing services
expressed as a percentage over Accoya segmental total revenue excluding Accoya underlying licence revenue and
marketing services. Accoya Manufacturing margin provides a measure of the profitability of the Accoya operations
relative to revenue.
Adjusted Cash
Cash & cash equivalents less restricted cash and cash raised through an equity raise to be invested into Accoya USA
Joint Venture. See note 30.
Accounting judgements
In preparing the Consolidated Financial Statements, management has to make judgments on how to apply the Group’s
accounting policies and make estimates about the future. The critical judgements that have been made in arriving
at the amounts recognised in the Consolidated Financial Statements and the key sources of uncertainty that have a
significant risk of causing a material adjustment to the carrying value of assets and liabilities in the next financial year
are discussed below:
Financial asset at fair value through profit or loss
The Group has an investment in listed equity shares carried at nil fair value as a reliable fair value cannot be obtained
since there is no active market for the shares and there is currently uncertainty around the future funding of the
business. The Group makes appropriate enquiries and considers all of the information available to it in order to
determine the fair value (See note 18).
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| Accsys Technologies PLC | Annual Report and Financial Statements 2023
139
• Deferred Tax related to Assets and Liabilities arising from a Single Transaction – amendments to IAS 12; and
• Disclosure of Accounting Policies – Amendments to IAS 1 and IFRS Practice Statement 2.
Accoya segmental underlying EBITDA
Accoya underlying Licence revenue
The amendments listed above did not have any impact on the amounts recognised in prior periods and are not
Accoya segmental underlying EBITDA (excluding. Licence Income)
Notes to the Financial Statements continued
for the year ended 31 March 2023
2. Accounting judgements and estimates continued
New standards and interpretations in issue at the date of authorisation of these financial
statements:
New standards, amendments and interpretations
The following amendments to Standards and a new Interpretation have been adopted for the financial year beginning
on 1 April 2022:
• Onerous Contracts – Cost of Fulfilling a Contract – Amendments to IAS 37;
• Annual Improvements to IFRS Standards 2018-2020;
• Reference to the Conceptual Framework – Amendments to IFRS 3;
expected to significantly affect the current or future periods.
New standards, amendments and interpretations not yet adopted
Certain new accounting standards and interpretations have been published that are not mandatory for 31 March 2023
reporting periods and have not been early adopted by the Group. These standards are not expected to have a material
impact on the entity in the current or future reporting periods and on foreseeable future transactions.
3. Segmental reporting
The Group’s business is the manufacturing of and development, commercialisation and licensing of the associated
proprietary technology for the manufacture of Accoya wood, Tricoya wood elements and related acetylation
technologies. Segmental reporting is divided between corporate activities, activities directly attributable to Accoya,
to Tricoya or research and development activities.
Accoya
Year ended
31 March
2023
Underlying
€’000
143,494
300
16,773
160,567
(105,608)
54,959
(22,621)
32,338
32,338
(912)
31,426
6,832
211
38,469
Year ended
31 March
2023
Exceptional
items & Other
Adjustments
€’000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Accoya wood revenue
Licence revenue
Other revenue
Total Revenue
Cost of sales
Gross profit
Other operating costs
Profit from operations
Profit from operations
Accoya USA EBIT
EBIT
Depreciation and amortisation
Accoya USA Depreciation and amortisation
EBITDA
Accoya Segment
Year ended
31 March
2023
Year ended
31 March
2022
TOTAL
€’000
Underlying
€’000
143,494
105,053
300
16,773
160,567
400
13,879
119,332
(105,608)
(83,435)
54,959
(22,621)
32,338
32,338
–
32,338
6,832
–
35,897
(19,116)
16,781
16,781
(261)
16,520
4,787
–
Year ended
31 March
2022
Exceptional
items & Other
Adjustments
€’000
–
–
–
–
–
–
(133)
(133)
Year ended
31 March
2022
TOTAL
€’000
105,053
400
13,879
119,332
(83,435)
35,897
(19,249)
16,648
(133)
16,648
–
(133)
–
–
–
16,648
4,787
–
All costs of sales are allocated against manufacturing activities in Arnhem and in Barry (Wales) unless they can be
directly attributable to a licensee. Other operating costs include all costs associated with the operation of the Arnhem
and Barry manufacturing sites, including directly attributable administration, sales and marketing costs.
See note 5 for explanation of Exceptional items and other adjustments.
Average headcount = 175 (2022: 162)
The below table shows details of reconciling items to show both Accoya EBITDA and Accoya Manufacturing gross profit,
both including and excluding licence and licensing related income, which has been presented given the inclusion of
items which can be more variable or one-off.
2023
€’000
38,469
(300)
38,169
54,959
2022
€’000
21,307
(400)
20,907
35,897
(300)
(400)
54,659
34.1%
2023
54,659
63,344
863
35,497
29.8%
2022
35,497
59,649
595
Year ended
31 March
2022
Exceptional
items & Other
Adjustments
€’000
–
–
–
–
–
–
(3)
(3)
(3)
–
–
Year ended
31 March
2022
TOTAL
€’000
1,459
16
45
1,520
(1,417)
103
(3,814)
(3,711)
(3,711)
505
–
Year ended
31 March
2023
Underlying
€’000
Year ended
31 March
2023
Exceptional
items & Other
Adjustments
€’000
1,373
29
49
1,451
(1,244)
207
–
–
–
–
–
–
Tricoya Segment
Year ended
31 March
2023
Year ended
31 March
2022
TOTAL
€’000
1,373
29
49
1,451
(1,244)
207
Underlying
€’000
1,459
16
45
1,520
(1,417)
103
(3,811)
(3,708)
(5,823)
(86,000)
(91,823)
(5,616)
(86,000)
(91,616)
(5,616)
(86,000)
(91,616)
(3,708)
527
–
–
527
86,000
86,000
505
–
Accoya segmental underlying gross profit
Accoya underlying Licence revenue
Accoya manufacturing gross profit
Accoya Manufacturing Margin
Accoya Manufacturing gross profit–€’000
Accoya sales volume–m3
Accoya manufacturing gross profit per m3
Tricoya
Tricoya panel revenue
Licence revenue
Other revenue
Total Revenue
Cost of sales
Gross profit
Other operating costs
Loss from operations
Loss from operations
Depreciation and amortisation
Impairment
EBITDA
Revenue includes the sale of Accoya, licence income and other revenue, principally relating to the sale of acetic acid and
other licensing related income. Revenue also includes sales of lower visual grade Accoya to Tricoya customers for the
purposes of producing Tricoya panels as a temporary work-around until the dedicated Tricoya Hull plant is operational.
See note 5 for explanation of Exceptional items and other adjustments.
Average headcount = 23 (2022: 36), noting a substantial proportion of the costs to date have been incurred via
recharges from other parts of the Group or have resulted from contractors.
39,170
21,307
(133)
21,435
Other operating costs includes pre-operating costs for the Tricoya Hull Plant.
(5,089)
–
(5,089)
(3,203)
(3)
(3,206)
Revenue and costs are those attributable to the business development of the Tricoya process and establishment of
Tricoya Hull Plant.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 140
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
3. Segmental reporting continued
Corporate
Year ended
31 March
2023
Underlying
€’000
Year ended
31 March
2023
Exceptional
items & Other
Adjustments
€’000
Corporate Segment
Year ended
31 March
2023
Year ended
31 March
2022
TOTAL
€’000
Underlying
€’000
Year ended
31 March
2022
Exceptional
items & Other
Adjustments
€’000
Year ended
31 March
2022
TOTAL
€’000
–
–
–
–
–
–
(9,976)
(9,976)
(9,976)
866
(9,110)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1,453)
(1,453)
(11,429)
(11,429)
(7,430)
(7,430)
(1,453)
(11,429)
(7,430)
–
866
805
(1,453)
(10,563)
(6,625)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(7,430)
(7,430)
(7,430)
805
(6,625)
Accoya wood revenue
Licence revenue
Other revenue
Total Revenue
Cost of sales
Gross result
Other operating costs
Loss from operations
Loss from operations
Depreciation and amortisation
EBITDA
Corporate costs are those costs not directly attributable to Accoya, Tricoya or Research and Development activities.
This includes management and the Group’s corporate and general administration costs including the head office in
London. See note 5 for explanation of Exceptional items and other adjustments.
Average headcount = 33 (2022: 37)
Research and Development
Research & Development Segment
Year ended
31 March
2023
Underlying
€’000
Year ended
31 March
2023
Exceptional
items & Other
Adjustments
€’000
Year ended
31 March
2023
Year ended
31 March
2022
TOTAL
€’000
Underlying
€’000
Year ended
31 March
2022
Exceptional
items & Other
Adjustments
€’000
Year ended
31 March
2022
TOTAL
€’000
–
–
–
–
–
–
(1,458)
(1,458)
(1,458)
67
(1,391)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1,458)
(1,458)
(1,184)
(1,184)
(1,458)
(1,184)
67
(1,391)
68
(1,116)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1,184)
(1,184)
(1,184)
68
(1,116)
Accoya wood revenue
Licence revenue
Other revenue
Total Revenue
Cost of sales
Gross result
Other operating costs
Loss from operations
Loss from operations
Depreciation and amortisation
EBITDA
Research and Development costs are those associated with the Accoya and Tricoya processes. Costs exclude those
which have been capitalised in accordance with IFRS (see note 15).
Average headcount = 13 (2022: 9)
141
Year ended
31 March
2022
TOTAL
€’000
106,512
416
13,924
120,852
(84,852)
36,000
(31,677)
4,323
–
(2,349)
(261)
1,713
Year ended
31 March
2022
TOTAL
€’000
4,323
–
4,323
6,164
–
–
Total
Accoya/Tricoya revenue
Licence revenue
Other revenue
Total Revenue
Cost of sales
Gross profit
Year ended
31 March
2023
Underlying
€’000
144,867
329
16,822
162,018
(106,852)
55,166
Year ended
31 March
2023
Exceptional
items & Other
Adjustments
€’000
–
–
–
–
–
–
Total
Year ended
31 March
2023
Year ended
31 March
2022
TOTAL
€’000
Underlying
€’000
144,867
106,512
329
16,822
416
13,924
162,018
120,852
(106,852)
(84,852)
55,166
36,000
Other operating costs
(39,878)
(87,453)
(127,331)
(31,541)
Profit/ (loss) from operations
15,288
(87,453)
(72,165)
4,459
Finance income
Finance expense
Investment in joint venture
–
(3,224)
(1,036)
–
9,350
–
6,126
–
(1,036)
Profit/(Loss) before taxation
11,028
(78,103)
(67,075)
–
(2,893)
(261)
1,305
See note 5 for details of Exceptional items and other adjustments.
Reconciliation of Underlying EBIT and EBITDA
Year ended
31 March
2022
Exceptional
items & Other
Adjustments
€’000
–
–
–
–
–
–
(136)
(136)
–
544
–
408
Year ended
31 March
2023
Underlying
€’000
Year ended
31 March
2023
Exceptional
items & Other
Adjustments
€’000
Year ended
31 March
2023
Year ended
31 March
2022
TOTAL
€’000
Underlying
€’000
Year ended
31 March
2022
Exceptional
items & Other
Adjustments
€’000
Profit/(loss) from operations
15,288
(87,453)
(72,165)
4,459
Accoya USA EBIT
EBIT
Depreciation and amortisation
Accoya USA Depreciation and amortisation
Impairment
EBITDA
(912)
14,376
8,292
211
–
–
–
(87,453)
(72,165)
–
–
8,292
–
86,000
86,000
(261)
4,198
6,164
–
–
22,879
(1,453)
22,127
10,362
(136)
10,487
(136)
–
(136)
–
–
–
Analysis of Revenue by geographical area of customers:
UK and Ireland
Rest of Europe
Americas
Rest of World
2023
€’000
55,395
63,635
29,778
13,210
2022
€’000
43,053
45,980
21,069
10,750
162,018
120,852
Revenue generated from two customers exceeded 10% of Group revenue of 2023. These two customers represented
35% & 34% of the revenue from the United Kingdom and Ireland, relating to Accoya revenue. Revenue generated from
two customers exceeded 10% of Group revenue of 2022. This included 37% & 34% of the revenue from the United
Kingdom and Ireland, relating to Accoya revenue.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 142
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
3. Segmental reporting continued
Assets and liabilities on a segmental basis
Accoya
2023
€’000
Tricoya
2023
€’000
Corporate
2023
€’000
R&D
2023
€’000
TOTAL
2023
€’000
Accoya
2022
€’000
Tricoya
2022
€’000
Corporate
2022
€’000
R&D
2022
€’000
TOTAL
2022
€’000
143
During the period, €437,000 (2022: €714,000) of internal development & patent related costs were capitalised
and included in intangible fixed assets, including €287,000 (2022: €488,000) which were capitalised within Tricoya
Technologies Limited (‘TTL’). In addition €171,000 of internal costs have been capitalised in relation to our current
Arnhem Accoya plant expansion project (2022: €375,000) and €566,000 of internal costs have been capitalised in
relation to our plant build in Hull, UK (2022: €739,000). Both are included within tangible fixed assets. The impairment
Non-current assets
120,459
27,047
3,777
162
151,445
91,278
99,718
4,119
228
195,343
loss is in relation to Tricoya assets, refer to note 5 and 16.
Current assets
52,699
3,872
13,630
4,872
75,073
36,899
4,425
33,452
5,021
79,797
Current liabilities
(22,947)
(4,156)
(15,299)
(56)
(42,458)
(19,399)
(21,112)
(5,156)
(75)
(45,742)
5. Exceptional items and other adjustments
Net current assets/
(liabilities)
Non-current
liabilities
Net assets/
(liabilities)
29,752
(284)
(1,669)
4,816
32,615
17,500
(16,687)
28,296
4,946
34,055
(2,545)
(8,665)
(50,289)
(59)
(61,558)
(2,826)
(1,252)
(52,339)
(111)
(56,528)
147,666
18,098
(48,181)
4,919
122,502
105,952
81,779
(19,924)
5,063
172,870
The Investment accounted for using the equity method (Investment in Accoya USA) is included in the Accoya segment.
See note 29
Analysis of non-current assets (Other than financial assets and deferred tax):
UK
Other countries
Un-allocated–Goodwill
2023
€’000
30,485
116,729
4,231
2022
€’000
107,861
83,251
4,231
151,445
195,343
The segmental assets in the current year were predominantly held in the UK, USA and mainland Europe (prior year UK and
mainland Europe). Additions to property, plant, equipment and intangible assets in the current year were predominantly
incurred in the UK and mainland Europe (Prior Year UK and mainland Europe). The increase in Investment accounted for
using the equity method (investment into Accoya USA) incurred in USA. There are no significant intersegment revenues.
4. Other operating costs
Other operating costs consist of the operating costs, other than the cost of sales, associated with the operation of
the plant in Arnhem, Barry, the offices in Dallas and London and certain pre-operating costs associated with the plant
in Hull:
Sales and marketing
Research and development
Other operating costs
Administration costs
Exceptional Items
Other operating costs excluding depreciation and amortisation
Depreciation and amortisation
Impairment – exceptional item
Total other operating costs
2023
€’000
5,219
990
9,720
15,657
1,453
33,039
8,292
86,000
127,331
2022
€’000
5,121
1,116
6,856
12,284
136
25,513
6,164
–
31,677
Administrative costs include costs associated with Business Development and Legal departments, Intellectual Property
as well as Human Resources, IT, Finance, Management and General Office and includes the costs of the Group’s head
office costs in London and the US Office in Dallas.
Group average headcount increased from 244 in the year to 31 March 2022, to 245 in the year to 31 March 2023.
Redundancy costs in relation to purchase of assets to grow Accoya Color production
Early termination of loans–redemption fee & accelerated amortisation of transaction costs
Advisor fees in relation to Tricoya consortium reorganisation
Impairment of the Tricoya segment assets
Partial net derecognition of NatWest loan
Recognition of Valuation Recovery Instrument ‘VRI’ liability
Foreign exchange differences on Corporate USD cash held for investment in to USA JV–incl. in Finance expense
Total exceptional items
Foreign exchange differences arising on Tricoya & Corporate cash held–Operating costs
Foreign exchange differences arising on Loan Notes–incl. in Finance expense
Foreign exchange differences on Tricoya–Other comprehensive income/(loss)
Revaluation of USD cash pledged to ABN Amro–incl. in Finance expense
Revaluation of FX forwards used for cash-flow hedging–Other comprehensive income/(loss)
Total other adjustments
Tax on exceptional items and other adjustments
Total exceptional items and other adjustments
Exceptional Items
2023
€’000
–
–
(1,453)
(86,000)
9,353
(1,383)
1,380
(78,103)
–
–
–
–
–
–
–
(78,103)
2022
€’000
(133)
(1,619)
–
–
–
–
2,080
328
(3)
231
8
(148)
58
146
–
474
In November 2022, Accsys agreed to acquire full ownership of TUK (Tricoya UK Limited) and TTL (Tricoya Technologies
Limited), from its Consortium Partners (see note 28).
The advisor fees are associated with advising Accsys on options and resulting corporate restructuring of the
Tricoya consortium.
In November 2022, NatWest agreed to restructure its TUK debt facility, reducing the principal amount by €9.4m to
€6m, under a new 7-year term (see note 30). This resulted in the derecognition of the balance drawn on the NatWest
loan on the date of the restructure of €15.4m and recognition of the new €6m loan.
Separate to, and in addition to the amended €6m loan, NatWest will be entitled to obtain recovery, via the Value
Recovery Instrument (‘VRI’) agreement, of up to approximately €9.4m, on a contingent basis, depending on profitability
of the Tricoya Hull plant once operational. The contingent payments to NatWest are based upon free cash-flow
generated by the Hull plant.
A financial liability has been recognised of €1.4m (see note 23) in respect of the VRI.
The impairment of the Tricoya segment assets is caused by
(i) As reported in November 2022, Identification of additional time and costs (€35m) to complete the plant;
(ii) A decrease in the production volume forecast for the plant to 24,000MT (from 30,000MT);
(iii) Update to the discount rate applied, 13.5% (increased from 10.5% at 31 March 2022). Refer to note 16 for review
of impairment.
Foreign exchange differences recognised due to US dollars held for investment into the Accoya USA Joint Venture.
Following the May 2021 equity raise, the amount raised to invest into Accoya USA was translated into US dollars
and held in cash ensuring that foreign exchange movements did not decrease the amount raised below the US
dollar investment into Accoya USA. This treatment did not meet the requirements for hedge accounting under IFRS
9, Financials instruments, and therefore the foreign exchange gain on the revaluation of the US dollars has been
accounted for in Finance expenses.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 144
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
5. Exceptional items and other adjustments continued
Exceptional Items continued
145
The Group made contributions to one (2022: one) Director’s personal pension plan, with Robert Harris receiving cash in
In the prior year, Accsys purchased certain assets, equipment, technology and its manufacturing plant in Barry, Wales
lieu of pension.
in a prior period (see note 30). These exchange rate differences are included as finance expenses.
Research & Development (excluding staff costs)
from Lignia Wood Company Limited and its administrators for a consideration of €1.2m, including €0.5m for raw wood
inventory. As part of this purchase, redundancy costs of €133,000 were incurred in relation to staff at the Barry site.
In the prior year, Accsys completed the refinance of its Group debt facilities, with a new bilateral agreement with ABN
Amro. Loans previously held with ABN Amro, Cerdia Produktions GmbH, Bruil, Volantis and Business Growth Fund (BGF)
were repaid. Early redemption fees totalling €1.4m were paid, and the amortisation of previously capitalised transaction
fees related to these repaid loans was accelerated.
Other Adjustments
Other adjustments included in the prior year are no longer disclosed for the year ended 31 March 2023.
In the prior year, foreign exchange differences in the Tricoya segment have occurred during the year due to pounds
sterling held for the Hull plant build and to a lesser extent, pounds sterling held within the Corporate segment for
future sterling corporate costs. The effective portion of the foreign exchange movement is recognised in other
comprehensive income, with the ineffective portion recognised in Operating costs.
In the prior year, foreign exchange differences also arise on the pounds sterling denominated loan notes, entered into
6. Employees
Staff costs (including Directors) consist of:
Wages and salaries
Social security costs
Other pension costs
Share based payments
2023
€’000
18,584
2,838
1,573
201
23,196
Pension costs relate to defined contribution plan contributions.
The average monthly number of employees, including Executive Directors, during the year was as follows:
Sales and marketing, administration, research and engineering
Operating
7. Directors’ remuneration
Directors’ remuneration consists of:
Directors’ emoluments
Company contributions to money purchase pension schemes
2022
€’000
17,007
2,620
1,381
140
21,148
2022
134
110
244
2023
142
103
245
2023
€’000
2022
€’000
1,170
38
1,208
1,168
43
1,211
Compensation of key management personnel included the following amounts:
Rob Harris
William Rudge
Salary, bonus
and short
term benefits
€’000
642
102
744
Share based
payments
charge
€’000
(53)
(10)
(63)
Pension
€’000
30
8
38
2023
Total
€’000
619
100
719
2022
Total
€’000
568
308
876
William Rudge stepped down from the Board following the AGM on 23 September 2022. In the table above, his
remuneration is included up to 23 September 2022.
The figures in the above table are impacted by foreign exchange noting that the remuneration for R Harris and
W Rudge are denominated in Pounds Sterling.
8. Operating profit
This has been arrived at after charging/(crediting):
Staff costs
Depreciation of property, plant and equipment, and right of use assets
Impairment
Amortisation of intangible assets
Operating lease rentals
Foreign exchange (gains)
Fees payable to the Company’s auditors for the audit of the Group’s annual financial statements
Fees payable to the Company’s auditors for other services:
– audit of the Company’s subsidiaries pursuant to legislation
– audit related assurance services
Fees payable to Component auditor for audit of subsidiaries
Total audit and audit related services:
2023
€’000
23,196
7,512
86,000
780
77
(70)
469
183
205
–
182
570
2022
€’000
21,148
5,419
–
745
103
(171)
416
145
110
36
117
408
Additional audit fees were agreed for the 2022 audit of €170,000 which are not included in the table above, including
€80,000 for fees payable for the audit of the Group’s annual financial statements and €90,000 for fees payable for the
audit of subsidiaries.
9. Finance income
Interest receivable on bank and other deposits*
2023
€’000
–
2022
€’000
–
*
€1,000 interest received in the year ended 31 March 2023 (31 March 2022: €8,000) in relation to cash balances held in Tricoya UK Ltd was netted off with
borrowing costs incurred, with the net borrowing cost amount related to the Hull project capitalised and included within property, plant and equipment.
10. Finance expense
Arnhem land and buildings lease finance charge
Interest on loans
Interest on lease liabilities
Other finance expenses
Total underlying finance expenses
Exceptional items and other adjustments
Foreign exchange (gain)/loss on loan notes
Revaluation of USD cash pledged to ABN Amro
Early termination of loans–redemption fee & accelerated amortisation of transaction costs
Foreign exchange (gain)/loss on Corporate USD cash held for investment in to USA JV
Partial derecognition of NatWest loan
Recognition of Valuation Recovery Instrument “VRI”
Total Finance expense
2023
€’000
179
2,500
115
430
3,224
–
–
–
(1,380)
(9,353)
1,383
(6,126)
2022
€’000
183
2,282
139
289
2,893
(231)
148
1,619
(2,080)
–
–
2,349
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
146
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
11. Tax expense
(a) Tax recognised in the statement of comprehensive income comprises:
Current tax charge
UK Corporation tax on losses for the year
Research and development tax (credit)/ expense in respect of current year
Overseas tax at rate of 15%
Overseas tax at rate of 25%
Deferred Tax
Utilisation of deferred tax asset
Total tax charge reported in the statement of comprehensive income
(b) The tax charge for the period is higher than the standard rate of corporation tax in the UK
(2023 & 2022: 19%) due to:
Profit/(Loss) before tax
Expected tax charge at 19% (2022–19%)
Expenses not deductible in determining taxable profit
Tricoya segment assets impairment
Tax (income)/losses for which no deferred income tax asset was (utilised)/recognised
Effects of overseas taxation
Research and development tax charge/(credit) in respect of prior years
Research and development tax (credit) in respect of current year
Total tax charge reported in the statement of comprehensive income
2023
€’000
2022
€’000
–
(121)
(121)
32
–
(314)
(314)
24
2,876
1,305
–
2,787
2023
€’000
(67,075)
(12,744)
148
16,340
(1,654)
818
3
(124)
2,787
–
1,015
2022
€’000
1,713
325
142
–
541
320
(190)
(123)
1,015
Deferred tax
€‘000
At 1 April
Credited/(charged) to the consolidated income statement
At 31 March
Deferred tax assets
Deferred tax liabilities
2023
484
137
621
2022
–
484
484
2023
(484)
(137)
(621)
2022
–
(484)
(484)
Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these
financial statements. See note 19.
12. Dividends Paid
Final Dividend €Nil (2022: €Nil) per Ordinary share proposed and paid during year relating to the previous
year’s results
2023
€’000
2022
€’000
–
–
147
13. Basic and diluted profit/(loss) per ordinary share
The calculation of profit per ordinary share is based on profit after tax and the weighted average number of ordinary
shares in issue during the year.
Basic earnings per share
2023
Underlying
2023
Total
2022
Underlying
2022
Total
Weighted average number of Ordinary shares in issue (‘000)
210,693
210,693
190,446
190,446
Profit/(Loss) for the year attributable to owners of Accsys Technologies PLC
(€’000)
Basic profit/(loss) per share
Diluted earnings per share
Weighted average number of Ordinary shares in issue (‘000)
Equity options attributable to BGF – see note 31
Weighted average number of Ordinary shares in issue and potential ordinary
shares (‘000)
Profit/(Loss) for the year attributable to owners of Accsys Technologies PLC
(€’000)
Diluted profit/(loss) per share
9,528
€0.05
(39,038)
€(0.19)
1,930
€0.01
2,338
€0.01
210,693
8,449
219,142
9,528
€0.04
–
–*
–
–
–*
190,446
190,446
8,449
8,449
198,895
198,895
1,930
€0.01
2,338
€0.01
*
Diluted loss per share is not disclosed for Total diluted loss per share. IAS 33 “Earning per share” defines Dilutive share options as share options which would
decrease profit per share or increase loss per share. Equity options to BGF are disclosed in note 31, which if exercised, would decrease Total loss per share.
As a result, these are anti-dilutive and therefore shown as nil.
14. Share based payments
The Group operates a number of share schemes which give rise to a share based payment charge. The Group operates
a Long Term Incentive Plan (‘LTIP’) in order to reward certain members of staff including the Senior Management team
and the Executive Directors.
Options – total
The following figures take into account options awarded under the LTIP, together with share options awarded in
previous years under the 2008 Share Option schemes.
Outstanding options granted are as follows:
Date of grant
19 September 2013 (LTIP)
24 June 2016 (LTIP)
20 June 2017 (LTIP)
18 June 2018 (LTIP)
25 June 2019 (LTIP)
20 November 2019 (LTIP)
23 December 2019 (LTIP)
15 July 2020 (LTIP)1
23 June 2021 (LTIP)
12 July 2022 (LTIP)
Total
Number of outstanding
options at 31 March
Weighted average remaining
contractual life, in years
2023
2022
2023
2022
443,675
599,880
130,099
100,651
185,840
–
–
–
183,320
326,999
185,840
475,258
105,699
41,468
850,540
1,172,290
511,112
868,889
352,486
–
2,574,403
3,959,643
0.5
3.3
4.3
5.3
6.3
6.7
6.8
7.3
8.3
9.3
6.1
1.5
4.3
5.3
6.3
7.3
7.7
7.8
8.3
9.3
–
6.8
1
850,540 nil cost options are outstanding in the 2020 LTIP award at 31 March 2023 but no options are estimated to vest on the relevant vesting dates in the 2023
calendar year.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
148
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
14. Share based payments continued
Options – total continued
Movements in the weighted average values are as follows:
Outstanding at 01 April 2021
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
Outstanding at 31 March 2022
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
Outstanding at 31 March 2023
Weighted average
exercise price
€0.01
€0.00
€0.00
€0.00
€0.50
Number
3,971,371
918,659
(210,928)
(629,459)
(90,000)
€0.00
3,959,643
€0.00
620,698
€0.00
(1,570,164)
€0.00
€0.00
(435,774)
–
€0.00
2,574,403
The exercise price of options outstanding at the end of the year was €nil (for LTIP options) (2022: €nil) and their
weighted average contractual life was 6.1 years (2022: 6.8 years).
Of the total number of options outstanding at the end of the year 860,265 (2022: 1,296,039) had vested and were
exercisable at the end of the year.
Long Term Incentive Plan (‘LTIP’)
In 2013, the Group established a Long Term Incentive Plan, the participants of which are key members of the Senior
Management Team, including Executive Directors. The establishment of the LTIP was approved by the shareholders
at the AGM in September 2013.
2013 LTIP Award performance conditions and 2016 outcome
The LTIP in 2013 awarded 4,103,456 nil cost options and 2,472,550 vested in the financial year ended 31 March 2017.
443,675 nil cost options remain as at 31 March 2023 after allowing for forfeitures and options exercised in the year.
2016 LTIP Award performance conditions and 2019 outcome
The LTIP in 2016 awarded 1,070,255 nil cost options and 494,433 vested in the financial year ended 31 March 2020.
130,099 nil cost options remain as at 31 March 2023 after allowing for forfeitures and options exercised in the year.
2017 LTIP Award performance conditions and 2020 outcome
The LTIP in 2017 awarded 1,087,842 nil cost options and 326,999 vested in the financial year ended 31 March 2021.
100,651 nil cost options remain as at 31 March 2023 after allowing for forfeitures and options exercised in the year.
2018 LTIP Award performance conditions and 2021 outcome
The LTIP in 2018 awarded 1,170,160 nil cost options and 185,840 vested in the financial year ended 31 March 2022.
185,840 nil cost options remain as at 31 March 2023 after allowing for forfeitures and options exercised in the year.
2019 LTIP Award performance conditions and 2022 outcome
The LTIP in 2019 awarded 810,520 nil cost options and no options vested in the financial year ended 31 March 2023.
149
Awards made in July 2020 and LTIP Award performance conditions
During the prior year, a total of 1,326,966 LTIP awards were made primarily to members of the Senior Management team
including the Executive Directors:
The performance targets for 1,255,829 of these awards are as follows:
Metric
Vesting (% of maximum)
EBITDA per share in FY23
Total sales volume in FY23 (m3)
Weighting
(% of award)
60%
40%
Threshold
Stretch
Maximum
25%
€0.14
70%
€0.19
90,000
105,000
100%
€0.24
112,720
• Vesting is on a straight-line basis between points in the schedule.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
• EBITDA per share targets are set and determined so as to exclude licensing income.
• Sales Volume is defined as combined sales volume (in cubic metres, or equivalent) of Accoya and Tricoya.
• Vesting of the Sales Volume component will be subject to the achievement of a threshold level of EBITDA.
Element
Grant date
Share price at grant date (€)
Exercise price (€)
Expected life (years)
Contractual life (years)
Vesting conditions (Details set out above)
Risk free rate
Expected volatility
Expected dividend yield
Fair value of option
Element A
(EBITDA per share)
Element B
(Sales volume growth)
15 July 20
15 July 20
1.00
0.00
3
10
EBITDA
–0.69%
20%
0%
€1.00
1.00
0.00
3
10
Sales volume growth
–0.69%
20%
0%
€1.00
The remaining 71,137 of the awards made in summer 2020 were specific to individuals dedicated to the Tricoya
consortium with performance measures linked to progress and development of the Tricoya plant and its subsequent
operation. The fair value of these options were €0.998 on their Grant date.
All of the above awards, made in summer 2020 are subject to a three year performance period (i.e. year end March
2023) and a further two year holding period. In addition, awards are also subject to malus/claw-back provisions.
As at 31 March 2023, no share options are estimated to vest.
Awards made in July 2021 and LTIP Award performance conditions
During the year, a total of 918,659 LTIP awards were made primarily to members of the Senior Management team
including the Executive Directors:
The performance targets for 863,624 of these awards are as follows:
Metric
Vesting (% of maximum)
EBITDA per share in FY24
Cumulative Sales Volume (FY22 to FY24) (m3)
ESG – improvement in reporting ratings
Weighting (% of award)
60%
30%
10%
Threshold
25%
€0.15
267,000
Maximum
100%
€0.24
297,000
33% on attaining each of the 3 year milestones:
Y1 – Attain investor ESG external rating/score
Y2 – Improve or at least maintain ESG external rating/score
Y3 – Improve or at least maintain ESG external rating/score
•
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 150
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
151
Notes to the Financial Statements continued
for the year ended 31 March 2023
14. Share based payments continued
Long Term Incentive Plan (‘LTIP’) continued
• Vesting is on a straight-line basis between points in the schedule.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
• EBITDA per share targets are set and determined so as to exclude licensing income.
• Sales Volume is defined as combined sales volume (in cubic metres, or equivalent) of Accoya and Tricoya.
Element
Grant date
Share price at grant date (€)
Exercise price (€)
Expected life (years)
Contractual life (years)
Vesting conditions (Details set out above)
Risk free rate
Expected volatility
Expected dividend yield
Fair value of option
Element A
(EBITDA per share)
Element B
(Sales volume growth)
Element C
(ESG Reporting Metrics)
23 Jun 21
23 Jun 21
23 Jun 21
2.06
0.00
3
10
EBITDA
-0.67%
20%
0%
€2.06
2.06
0.00
3
10
2.06
0.00
3
10
Sales volume growth
ESG reporting metrics
-0.67%
20%
0%
€2.06
–0.67%
20%
0%
€2.06
The remaining 55,035 of the awards made in summer 2021 were specific to individuals dedicated to the Tricoya
consortium with performance measures linked to progress and development of the Tricoya plant and its subsequent
operation. The fair value of these options were €2.06 on their Grant date.
All of the above awards, made in summer 2021 are subject to a three year performance period (i.e. year end March
2024) and a further two year holding period. In addition, awards are also subject to malus/claw-back provisions.
Awards made in July 2022 and LTIP Award performance conditions
During the year, a total of 620,698 LTIP awards were made primarily to members of the Senior Management team
including the Executive Directors:
The performance targets for these awards are as follows:
Metric
Vesting (% of maximum)
Cumulative Sales Volume (FY23 to FY25) (m3)
Average Gross contribution (%)
Share performance compared to AIM Index
Weighting (% of award)
25%
25%
40%
Threshold
25%
206,000
49.60%
Median
Maximum
100%
232,000
55%
Upper quartile
15% improvement in
20% improvement in
S&P ESG score over
S&P ESG score over
ESG – improvement in reporting ratings
10%
the three year period
the three year period
• Vesting is on a straight-line basis between points in the schedule.
• Appropriate adjustments may be made to ensure fair and consistent performance measurement over the
performance period in line with the business plan and intended stretch of the targets at the point of award.
• Gross contribution defined as Revenue from sale of Accoya/Tricoya less Net acetyls and raw wood cost.
• Sales Volume is defined as combined sales volume (in cubic metres, or equivalent) of Accoya and Tricoya.
• Share performance is compared to AIM Index performance excluding Financial services and natural resource stocks.
Element
Grant date
Share price at grant date (€)
Exercise price (€)
Expected life (years)
Contractual life (years)
Element A
(Sales volume growth)
Element B
(Gross Contribution %)
Element C
(Share price growth)
Element D
(ESG Reporting Metrics)
12 Jul 22
12 Jul 22
12 Jul 22
12 Jul 22
1.21
0.00
3
10
1.21
0.00
3
10
1.21
0.00
3
10
1.21
0.00
3
10
Vesting conditions (Details set out above)
Sales volume Gross Contribution %
Share price ESG reporting metrics
Risk free rate
Expected volatility
Expected dividend yield
Fair value of option
0.45%
20%
0%
€1.21
0.45%
20%
0%
€1.21
0.45%
20%
0%
€0.90
0.45%
20%
0%
€1.21
All of the above awards, made in summer 2022 are subject to a three year performance period (i.e. year end March
2025) and a further two year holding period. In addition, awards are also subject to malus/ claw-back provisions.
Employee Benefit Trust – Share bonus award
137,665 new Ordinary shares are held by an Employee Benefit Trust as part of the annual bonus, in connection with
the employee remuneration and incentivisation arrangements for the period from 1 April 2021 to 31 March 2022,
the beneficiaries of which are primarily senior employees. Such new Ordinary shares vest if the employees remain in
employment with the Company at the vesting date, being 1 July 2023 (subject to certain other provisions including
regulations, good-leaver, take-over and Remuneration Committee discretion provisions). As at 31 March 2023, the
Employment Benefit Trust was consolidated by the Company and the 137,665 shares are recorded as Own Shares
within equity.
Employee Share Participation Plan
The Employee Share Participation Plan (the ‘Plan’) is intended to promote the long term growth and profitability of
Accsys by providing employees with an opportunity to acquire an ownership interest in new Ordinary shares (‘Shares’)
in the Company as an additional benefit of employment. Under the terms of the Plan, the Company issues these Shares
to a trust for the benefit of the subscribing employees. The Shares are released to employees after one year, together
with an additional Share on a 1 for 1 matched basis provided the employee has remained in the employment of Accsys
at that point in time (subject to good leaver provisions). The Plan is in line with industry approved employee share plans
and is open for subscription by employees once a year following release of the interim financial results. The maximum
amount available for subscription by any employee is €5,000 per annum. In January 2023, various employees subscribed
for a total of 203,906 Shares at an acquisition price of €0.81 per Share.
Also during the year, 1 for 1 Matching shares were awarded in respect of subscriptions that were made in the previous
year as a result of the participants continuing to remain in employment at the point of vesting. 174,144 matching shares
were issued to employees in January 2023.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 152
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
15. Intangible assets
Impairment review
153
Internal
Development
costs
€’000
Intellectual
property
rights
€’000
Goodwill
€’000
Total
€’000
Cost
At 01 April 2021
Additions
At 31 March 2022
Additions
At 31 March 2023
Accumulated amortisation
At 01 April 2021
Amortisation
At 31 March 2022
Amortisation
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 31 March 2021
7,464
178
7,642
57
7,699
2,510
384
2,894
385
3,279
4,420
4,748
4,954
74,456
536
74,992
380
75,372
72,776
361
73,137
395
73,532
1,840
1,855
1,680
4,231
–
4,231
–
4,231
–
–
–
–
–
4,231
4,231
4,231
Refer to note 16 for the recoverability assessment of these intangible assets.
16. Property, plant and equipment
86,151
714
86,865
437
87,302
75,286
745
76,031
780
76,811
10,491
10,834
10,865
Total
€’000
168,294
41,473
7
Land and
buildings
€’000
Plant and
machinery
€’000
Office
equipment
€’000
17,976
146,433
3,885
–
–
41,012
–
461
7
17,976
187,445
4,353
209,774
–
–
21,376
–
341
3
21,717
3
17,976
208,821
4,697
231,494
995
358
–
1,353
358
–
–
1,711
16,265
16,623
16,981
25,945
3,550
–
29,495
5,397
–
86,000
120,892
87,929
157,950
120,488
1,797
461
7
2,265
572
3
–
2,840
1,857
2,088
2,088
28,737
4,369
7
33,113
6,327
3
86,000
125,443
106,051
176,661
139,557
Cost or valuation
At 01 April 2021
Additions
Foreign currency translation gain
At 31 March 2022
Additions
Foreign currency translation gain
At 31 March 2023
Accumulated depreciation
At 01 April 2021
Charge for the year
Foreign currency translation gain
At 31 March 2022
Charge for the year
Foreign currency translation gain
Impairment loss
At 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 1 April 2021
Plant and machinery assets with a net book value of €24,851,000 are held as assets under construction and are not
depreciated, relating to the Hull Plant (31 March 2022: €93,560,000).
The carrying value of the property, plant and equipment, internal development costs and intellectual property rights
are split between two cash generating units (CGUs), representing the Accoya and Tricoya segments and the carrying
value of Goodwill is allocated to the Accoya segment. The recoverable amount of these CGUs are determined based on
a value-in-use calculation which uses cash flow projections for a period of 5 to 7 years based on latest financial budgets
and discounted at a pre-tax discount rate of 13.5% (31 March 2022: 10.5%) to determine their present value. A cash
flow projection period of 7 years was used for the Tricoya segment calculation to reflect the future cashflows of the
plant, considering the estimated hold period, remaining completion activities and production ramp-up.
The key assumptions used in the value in use calculations are:
• the manufacturing revenues, operating margins and future licence fees estimated by management,
• the timing of completion of the Tricoya Hull plant,
• the timing of completion of construction of additional facilities (and associated output),
• forecast UK natural gas prices,
• the long term growth rate and
• the discount rate.
The Directors have determined that an impairment totalling €86 million should be recognised in the Tricoya CGU.
The impairment of the Tricoya segment assets is caused by:
(i) As reported in November 2022, identification of additional time and costs (€35m) to complete the plant;
(ii) A decrease in the production volume forecast for the plant to 24,000MT (from 30,000MT)
(iii) Update to the discount rate applied to 13.5% (increased from 10.5% at 31 March 2022).
Key assumptions applied to the Tricoya CGU were as follows:
• a discount rate of 13.5%;
• project capital costs to bring the plant into commercial operation of €35m;
• a production capacity of 24,000MT
• a “hold period” of 2 years (from 31 March 2023) (period in which no construction activities is performed); and
• a long-term growth rate of 2.5%;
The impact the following changes to these key assumptions would have, if made in isolation, on the impairment
calculated for the Tricoya CGU is as follows:
• a 1% increase in the discount rate: increase of €7m
• a 1% decrease in the long-term growth rate: increase of €4m
• a 12 month extension in the hold period: increase of €9m
• a 1,000MT increase in the production capacity: decrease of €4m
• a €10m increase in the capital costs to bring the plant into commercial operation: increase of €7m
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 154
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
17. Leases
(i) Amounts recognised in the statement of financial position
The statement of financial position shows the following amounts relating to leases:
Right-of-use assets
Properties
Equipment
Motor Vehicles
Amounts payable under lease liabilities:
Within one year
In the second to fifth years inclusive
After five years
Less: future finance charges
Present value of lease obligations
Additions to the right-of-use assets during the financial year were €590,000 (2022: €801,000).
(ii) Amounts recognised in the statement of profit and loss
The statement of comprehensive income shows the following amounts relating to leases:
Depreciation charge of right-of-use assets
Properties
Equipment
Motor Vehicles
Interest expense (included in finance cost)
Expense relating to short-term leases (included in cost of goods sold and administrative expenses)
Expense relating to leases of low-value assets that are not shown above as short-term leases (included in
administrative expenses)
Expense relating to variable lease payments not included in lease liabilities (included in administrative expenses)
The total cash outflow for leases in 2023 was €940,000 (2022: €1,089,000)
The Group’s leasing activities and how these are accounted for:
Right-of-use assets
2023
€’000
2,880
1,148
16
4,044
2022
€’000
4,023
569
40
4,632
Minimum lease payments
2023
€’000
2022
€’000
1,132
2,085
3,502
(1,984)
4,735
1,250
2,390
3,972
(2,395)
5,217
2023
€’000
2022
€’000
893
255
34
1,182
294
60
18
–
807
209
34
1,050
322
83
20
–
The Group leases various offices, land, equipment and cars. Rental contracts are typically made for fixed periods of
1-10 years, although, if appropriate, a longer term may be entered into. Lease terms are negotiated on an individual
basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants,
but leased assets may not be used as security for borrowing purposes. Lease extension options and lease termination
options are only included in the calculation of the lease liability if there is reasonable certainty that they will be
exercised. Some of the Group’s leases have extension and termination options attached to them.
Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the statement of
comprehensive income over the lease period to produce a constant periodic rate of interest on the remaining balance
of the liability for each period. The right of use asset is depreciated over the shorter of the asset’s useful life and the
lease term on a straight-line basis.
155
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net
present value of the following lease payments:
• Fixed payments (including in-substance fixed payments), less any lease incentives receivable;
• Variable lease payments that are based on an index or a rate;
• Amounts expected to be payable by the lessee under residual value guarantees;
• The exercise price of a purchase option if the lessee is reasonably certain to exercise that option; and
• Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the Group’s incremental borrowing rate, being the rate that the Group would
have to pay to borrow the funds necessary to obtain an asset of similar economic environment within similar terms
and conditions.
Right of use assets are measured at cost comprising the following:
• The amount of initial measurement of lease liability;
• Any lease payments made at or before the commencement date less any lease incentives received;
• Any initial direct costs; and
• Restoration costs.
Payments associated with short-term leases and leases of low value are recognised on a straight-line basis as an
expense in the statement of comprehensive income. Short-term leases are leases with a lease term of 12 months or less.
Low-value assets comprise of small items of office furniture and equipment.
18. Financial asset at fair value through profit or loss
Financial asset at fair value through profit or loss
Shares held in Cleantech Building Materials PLC
2023
€’000
–
2022
€’000
–
Accsys Technologies PLC has previously purchased a total of 21,666,734 unlisted ordinary shares in Diamond Wood
China. On 23 December 2016, Cleantech Building Materials PLC acquired Diamond Wood China. On 19 April 2017
Cleantech Building Materials acquired the 21,666,734 shares previously owned by the Company and in return the
Company has been issued with 520,001 shares in Cleantech Building Materials PLC, a listed Company trading on the
Nasdaq First North market in Copenhagen.
There continues to be no active market for these shares as at 31 March 2023. As such a reliable fair value cannot be
calculated and the investment is carried at a nil fair value (2022: nil).
A total of 498,522 shares were held at 31 March 2023.
19. Deferred taxation
The Group has a recognised deferred tax asset of €621,000 (2022: €484,000) offsetting a recognised deferred tax
liability of €621,000 (2022: €484,000). See note 11.
The Group also has an unrecognised deferred tax asset of €62m (2022: €42m) which is largely in respect of trading
losses of the UK subsidiaries and has been calculated using the tax rate which is expected to be applicable when the tax
losses are expected to be utilised The deferred tax asset has been recognised only to the extent of the deferred tax
liability, due to the uncertainty of the timing of future expected profits of the related legal entities which is dependent
on the profits attributable to licensing and future manufacturing income.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 156
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
20. Subsidiaries
23. Financial liability at amortised cost
157
A list of subsidiary investments, including the name, country of incorporation and proportion of ownership interest is
given in note 4 to the Company’s separate financial statements.
21. Inventories
Raw materials and work in progress
Finished goods
2023
€’000
24,220
5,726
29,946
2022
€’000
16,978
3,393
20,371
The amount of inventories recognised as an expense during the year was €89,357,000 (2022: €67,698,000). The cost
of inventories recognised as an expense includes a net credit of €9,000 (2022: credit of €20,000) in respect of the
inventories sold in the period which had previously been written down to net realisable value.
22. Trade and other receivables
Trade receivables
Other receivables
VAT receivable
Prepayments
2023
€’000
14,398
1,154
1,472
1,051
18,075
2022
€’000
13,162
736
2,203
833
16,934
The Directors consider that the carrying amount of trade and other receivables is approximately equal to their fair
value. Trade and other receivables in the above table are stated net of provision for doubtful debts. The majority of
trade and other receivables is denominated in Euros, with €1,633,000 of the trade and other receivables denominated
in US Dollars (2022: €3,342,000).
The age of receivables past due but not impaired is as follows:
Up to 30 days overdue
Over 30 days and up to 60 days overdue
Over 60 days and up to 90 days overdue
Over 90 days overdue
2023
€’000
1,361
290
–
14
2022
€’000
1,248
–
–
24
1,665
1,272
In determining the recoverability of a trade receivable the Group considers any change in the credit quality of the
trade receivables from the date credit was initially granted up to the reporting date. Included in the provision are trade
receivables and accrued income with a balance of €25,002,000 (2022: €25,002,000).
Movement in provision for doubtful debts:
Balance at the beginning of the year
Net (decrease)/increase of impairment
Balance at the end of the year
2023
€’000
25,002
–
2022
€’000
25,002
–
25,002
25,002
Value Recovery Instrument (‘VRI’)
2023
€’000
1,383
2022
€’000
–
In November 2022, NatWest agreed to restructure its TUK debt facility, reducing the principal amount by €9.4m to
total €6m, under a new 7-year term (see note 30). Separate to, and in addition to the amended €6m loan, under the
Value Recovery Instrument (‘VRI’) agreement, NatWest will be entitled to obtain recovery of up to approximately
€9.4m, on a contingent basis, depending on the profitability of the Tricoya Hull plant once operational.
The valuation of the VRI was calculated on the same future cashflows modelled for the Tricoya impairment. See note 16
for a list of the key assumptions.
24. Trade and other payables
Trade payables
Other taxes and social security payable
Accruals and deferred income
2023
€’000
17,942
1,083
6,871
2022
€’000
16,655
1,754
11,471
25,896
29,880
The decrease in trade and other payables primarily relates to the timing of accruals associated with the construction of
the Hull plant.
25. Share capital
Allotted–Equity share capital
219,381,693 Ordinary shares of €0.05 each (2022: 192,761,322 Ordinary shares of €0.05 each)
All ordinary shares are called up, allotted and fully paid.
In the year ended 31 March 2022:
2023
€’000
10,963
10,963
2022
€’000
9,638
9,638
In May 2021, 20,005,325 Placing Shares and 2,418,918 Open Offer Shares were issued as part of the capital raise to fund
the Company’s investment in expanding its Accoya business into North America through the construction of a new
Accoya plant in the USA through its joint venture, Accoya USA LLC, with Eastman Chemical Company (see note 29), as
well as to provide additional capital to support the Company’s continued growth. The Shares were issued at a price of
€1.65 (£1.40) per ordinary share, raising gross proceeds of €36.7 million (before expenses).
Between June and September 2021, a total of 629,460 shares were issued following the exercise of nil cost options,
granted under the Company’s 2013 Long Term Incentive Plan (‘LTIP’).
In February 2022, following the subscription by employees in the prior year for shares under the Employee Share
Participation Plan (the ‘Plan’), 189,931 shares were issued as “Matching Shares” at nominal value under the Plan.
In addition, various employees newly subscribed under the Plan for 193,424 Shares at an acquisition price of €2.015 per
share, with these shares issued to a trust, to be released to the employees after one year, together with an additional
share on a matched basis (subject to continuing employment within the Group).
In the year ended 31 March 2023:
In May 2022, 13,793,103 Placing and Subscription Shares were issued as part of the capital raise to strengthen the
Company’s balance sheet, increase liquidity headroom and fund additional costs to complete the Arnhem Plant Reactor
4 capacity expansion. The Shares were issued at a price of €1.45 (£1.23) per ordinary share, raising gross proceeds of
€20 million (before expenses).
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 158
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
159
25. Share capital continued
28. Business combinations
Between August and December 2022, 435,774 Shares were issued following the exercise of nil cost options, granted
In November 2022, Accsys reached agreement to acquire full ownership of TUK (Tricoya UK Limited) and TTL
under the Company’s 2013 Long Term Incentive Plan (‘LTIP’).
In July 2022, 137,665 shares were issued to an Employee Benefit Trust (EBT) at nominal value, as part of the annual
bonus, in connection with the employee remuneration and incentivisation arrangements for the period from 1 April
(Tricoya Technologies Limited), from its Consortium Partners (INEOS, MEDITE, BGF & Volantis). Under the agreement
Accsys acquired the remaining 38.2% holding in TUK that TTL did not already own and the 23.5% holding in TTL that it
did not already own.
2021 to 31 March 2022. These shares will vest in July 2023, subject to the employees continuing employment within
Consideration of 11.9 million new ordinary Accsys shares was provided to the other Tricoya Consortium Partners valued
the Group.
at €9.5m (€0.81 per share).
In November 2022, 11,875,801 shares were issued to the Tricoya Consortium Partners (INEOS, MEDITE, BGF & Volantis)
INEOS and Medite’s respective supply and offtake agreements for the Hull plant will continue on their current terms.
at a price of €0.80 (£0.71) per share. This formed part of a Sales Purchase Agreement with the Tricoya Consortium
Partners whereby Accsys acquired the remaining 38.2% holding in TUK that TTL did not already own and the 23.5%
holding in TTL that it did not already own. See note 28.
Tricoya UK and TTL were consolidated in the Group results in the prior year and continue to be consolidated
following this purchase. The below table reflects the accounting for this acquisition, whereby the difference between
the consideration paid and the Non-controlling interest balance at the end of October 2022 has been allocated to
In January 2023, following the subscription by employees in the prior year for shares under the Employee Share
accumulated loss.
Participation Plan (the ‘Plan’), 174,144 shares were issued as “Matching Shares” at nominal value under the Plan.
In addition, various employees newly subscribed under the Plan for 203,906 Shares at an acquisition price of €0.81 per
share, with these shares issued to a trust, to be released to the employees after one year, together with an additional
share on a matched basis (subject to continuing employment within the Group).
26. Other reserves
Balance at 01 April 2021
Total comprehensive income for the period
Balance at 01 March 2022
Total comprehensive income for the period
Balance at 31 March 2023
Capital redemption
reserve
€000
148
–
148
–
148
Merger
reserve
€000
106,707
–
106,707
–
106,707
Hedging
Effectiveness reserve
€000
Other
reserve
€000
Total Other
reserves
€000
229
66
295
42
337
7,551
114,635
–
66
7,551
114,701
–
42
7,551
114,743
The closing balance of the capital redemption reserve represents the amounts transferred from share capital on
redemption of deferred shares in a previous year.
The merger reserve arose prior to transition to IFRS when merger accounting was adopted.
The hedging effectiveness reserve reflects the total accounted for under IFRS 9 in relation to the Tricoya segment
(see note 1).
The other reserve represents the amounts received for subsidiary share capital from non-controlling interests net with
the carrying amount of non-controlling interests issued (see note 27).
27. Transactions with non-controlling interests
In the year ended 31 March 2022:
No shares were issued in the year ended 31 March 2022.
The total carrying amount of the non-controlling interests in TTL and Tricoya UK at 31 March 2022 was €35.5m
(2021: €37.2m).
In November 2021, Accsys agreed a new €17m loan to Tricoya UK to be used towards the Hull plant construction
project alongside existing funding in place for Tricoya UK. The loan accrues interest, which is rolled up, at a rate
between 5.25 and 6.75% above EURIBOR. The loan is secured and is repayable by 30 September 2023. At 31 March
2022, the Group had lent to Tricoya UK €8.8m under the facility.
In the year ended 31 March 2023:
In November 2022, Accsys purchased the remaining ownership of TTL and Tricoya UK which it did not previously own
via a Sales Purchase Agreement (‘SPA’) with the Tricoya consortium partners. See note 28 for further details.
Non controlling interest balance as at 31 March 2022
NCI share of losses during the year ended 31 March 2023
Accsys Technologies PLC share issue as consideration
Difference recognised as attributable to the Accsys Technologies PLC
Non controlling interest balance as at 31 March 2023
29. Investment in Joint Venture
2023
€’000
35,526
(30,824)
(9,545)
4,843
–
In August 2020, Accsys together with Eastman Chemical Company formed a new Company, Accoya USA LLC, 60%
owned by Accsys and 40% owned by Eastman. Accoya USA LLC is constructing and will operate an Accoya plant
in Kingsport, Tennessee (USA) to serve the North American market. The plant is designed to initially produce
approximately 43,000 cubic metres of Accoya per annum and to allow for cost-effective expansion.
Under IFRS 11 – Joint arrangements, the two parties are assessed to jointly control the entity and Accoya USA is
accounted for as a joint venture and equity accounted for within the financial statements.
At 31 March 2023, Accsys and Eastman have contributed equity of $61m to Accoya USA LLC, with a further $5m
committed to be contributed.
An eight-year term loan of $70 million has been provided by First Horizon Bank (‘FHB’) of Tennessee, USA. FHB are
also providing a further $10 million revolving line of credit to be utilised to fund working capital. The FHB term loan
is secured on the assets of Accoya USA and will be supported by Accoya USA’s shareholders, including $50 million
through a limited guarantee provided on a pro-rata basis, with Accsys’ 60% share representing $30 million
(see note 32). The interest rate varies between 1.3% to 2.1% over USD LIBOR. Principal repayments commence
one year following the completion and start-up of the facility, and are calculated on a ten-year amortisation period.
The carrying amount of the equity-accounted investment is as follows:
Opening balance
Investment in Accoya USA
Less: Accsys proportion (60%) of Licence fee received
Loss for the year
Closing balance
The Group has equity accounted for the joint venture in these consolidated accounts.
2023
€’000
3,216
28,979
(300)
(1,036)
30,859
2022
€’000
326
3,751
(600)
(261)
3,216
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 160
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
161
29. Investment in Joint Venture continued
ABN Debt Facilities
The income statement, balance sheet and cashflows for Accoya USA LLC, are set out below:
In October 2021, Accsys completed the refinance of its Group debt facilities through a new bilateral agreement with
Accoya USA LLC recorded a loss from operations of €1,727,000 for the year ended 31 March 2023, (€435,000 for the
ABN Amro. The new €60m 3-year bilateral facilities agreement with ABN Amro comprised a
period ended 31 March 2022). The loss attributable to Accsys Technologies PLC was €1,036,000 for the year ended
• €45m Term Loan Facility and,
31 March 2023, (€261,000 for the period ended 31 March 2022).
Balance Sheet
Non-current assets
Property, plant and equipment
Right of use assets
Current assets
Trade and other receivables
Cash and cash equivalents
Current liabilities
Trade and other payables
Obligation under lease liabilities
Net current liabilities
Non-current liabilities
Obligation under lease liabilities
Other long term borrowing
Net assets
Cash flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net increase in cash and cash equivalents
30. Commitments under loan agreements
Loan obligations:
Within one year
In the second to fifth years inclusive
In greater than five years
Present value of loan obligations
Amounts payable under loan agreements – undiscounted cashflows:
Within one year
In the second to fifth years inclusive
After five years
Less future finance charges
Present value of loan obligations
2023
€’000
69,327
6,242
75,569
236
8,701
8,937
2022
€’000
17,589
6,403
23,992
–
235
235
(14,682)
(10,412)
(455)
(345)
(6,200)
(10,522)
(5,875)
(9,781)
(15,656)
53,713
2023
€’000
(1,147)
(49,568)
59,181
8,466
2023
€’000
9,500
50,288
6,132
(5,993)
243
(5,750)
7,720
2022
€’000
(209)
(7,310)
7,753
234
2022
€’000
11,654
52,335
–
65,920
63,989
10,312
52,976
9,962
(7,330)
65,920
12,973
59,506
–
(8,490)
63,989
• €15m Revolving Credit Facility (‘RCF’).
• The Term Loan is partially amortising, with 5% of the principal repayable per annum after 18 months.
• The applicable interest rate for the Term Loan varies between an all in cost of 1.75% and 3.25% depending on net leverage.
• The RCF interest rate varies between 2.0% and 3.5% above EURIBOR.
The RCF was subsequently increased to €25 million as part of the Accoya USA financing referred to below, with
approximately €20 million utilised for the Letter of Credit provided by ABN Amro to FHB in support of the Accoya USA
JV funding arrangements, the remaining €5million was drawn at 31 March 2023.
The new facilities are secured against the assets of the Group which are 100% owned by the Company and include
customary covenants such as net leverage and interest cover which are based upon the results and assets which are
100% owned by the Company.
Tricoya NatWest facility
In March 2017, the Company’s subsidiary, Tricoya UK Limited entered into a six-year €17.2 million finance facility
agreement with Natwest Bank plc in respect of the construction and operation of the Hull Plant. The facility is secured
by fixed and floating charges over all assets of Tricoya UK Limited.
In November 2022, as part of the Tricoya consortium restructure (see note 28) NatWest agreed to restructure its TUK
debt facility, reducing the principal amount by €9.4m to total €6m, under a new 7-year term. Interest will accrue and be
rolled up at Euribor plus a margin, with the margin ranging from 325 to 475 basis points. No repayments are due until
the facility maturity date.
At 31 March 2023, the Group had €6.0m (2022: €9.9m) borrowed under the facility.
Separate to, and in addition to the amended €6m loan, NatWest will be entitled to obtain recovery, via the Value
Recovery Instrument (‘VRI’) agreement, of up to approximately €9.4m, on a contingent basis, depending on profitability
of the Tricoya Hull plant once operational. (See note 23)
Accoya USA facility & De Engh facility
In March 2022, the Company’s joint venture, Accoya USA, agreed an eight-year $70 million loan from First Horizon Bank
(‘FHB’) of Tennessee, USA in respect of the construction and operation of the Accoya USA plant. FHB are also providing
a further $10 million revolving line of credit to be utilised to fund working capital. The FHB term loan is secured on the
assets of Accoya USA and is supported by Accoya USA’s shareholders, including $50 million through a limited guarantee
provided on a pro-rata basis, with Accsys’ 60% share representing $30 million (see note 29 & 32). The interest rate varies
between 1.3% to 2.1% over USD LIBOR. Principal repayments commence one year following the completion and start-up
of the facility, and are calculated on a ten-year amortisation period. Accoya USA is equity accounted for in these financial
statements, therefore this Borrowing is not included in the Group’s borrowings. (See note 29)
To support Accsys’ limited guarantee, Accsys provided a $20 million Letter of Credit (‘LC’) to FHB. The LC is issued
by ABN Amro, utilising part of the revolving credit facility agreed in October 2021. To further support the LC, Accsys
agreed a €10 million convertible loan with De Engh BV Limited (‘De Engh’) in March 2022, an investment Company
based in the Netherlands (the ‘Convertible Loan’). The Convertible Loan proceeds were placed with ABN Amro solely as
cash collateral to enable ABN Amro to grant the $20 million LC to FHB.
The Convertible Loan is unsecured and carries an interest margin of 6.25% above Euribor. If the Convertible Loan is not
repaid within two years, De Engh has an option (from the end of year two) to convert the outstanding loan balance to
ordinary shares in Accsys at €2.30 per share, otherwise the interest rate increases by 2% in year three and by a further
2% the following year if the loan has not been repaid or converted after 3 years. The maximum term of the Convertible
Loan is 3.5 years from March 2022.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 162
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
30. Commitments under loan agreements continued
Reconciliation to net debt
Cash and cash equivalents
Less:
Amounts payable under loan agreements
Amounts payable under lease liabilities (note 18)
Net debt
Restricted cash
163
2023
€’000
26,593
(65,920)
(4,735)
(44,062)
2022
€’000
42,054
(63,989)
(5,217)
(27,152)
32. Guarantee provided to FHB
In March 2022 the Company’s joint venture, Accoya USA agreed an eight-year $70million loan from First Horizon
Bank (‘FHB’) of Tennessee, USA in respect of the construction and operation of the Accoya USA plant and a further
$10 million revolving line of credit to be utilised to fund working capital (see note 28 & 29). The FHB term loan is
supported by Accoya USA’s shareholders, including $50 million through a limited guarantee provided on a pro-rata
basis, with Accsys’ 60% share representing $30 million (see note 28).
To support Accsys’ limited guarantee, Accsys provided a $20 million Letter of Credit, issued by ABN Amro, to FHB
(see note 30).
The $30 million limited guarantee provided to FHB is held at a fair value of €nil, representing a present value calculation
of €8.2 million weighted by the estimated probability of FHB calling on the guarantee being 0%.
The cash and cash equivalents disclosed above and in the Consolidated statement of cash flow includes $10 million
which is pledged to ABN Amro as collateral for the $20 million Letter of Credit provided to FHB (see note 29 & 32).
Reconciliation to adjusted cash
33. Financial instruments
Financial instruments
Lease liabilities
Cash and cash equivalents
Less: Remaining cash raised through May 2021 equity raise to be contributed to Accoya USA
Less: Cash pledged to ABN for Letter of Credit
Adjusted Cash
2023
€’000
26,593
–
(9,828)
16,765
Liabilities from financing activities
Other assets
Net debt as at 01 April 2021
Cash flows
New leases
Foreign exchange adjustments
Other changes
Net debt as at 31 March 2022
Cash flows
New leases
Foreign exchange adjustments
Other changes
Net debt as at 31 March 2023
31. Equity options
Borrowings
€’000
(54,290)
(7,561)
–
231
(2,369)
(63,989)
(8,445)
–
–
6,514
(65,920)
Leases
€’000
(5,532)
1,089
(801)
(7)
34
(5,217)
940
(590)
67
65
(4,735)
Sub-total
€’000
(59,822)
(6,472)
(801)
224
(2,335)
(69,206)
(7,505)
(590)
67
6,579
(70,655)
Cash
€’000
47,598
(7,879)
–
2,335
–
42,054
(16,984)
–
1,523
–
2022
€’000
42,054
(27,857)
(9,852)
4,345
Total
€’000
(12,224)
(14,351)
(801)
2,559
(2,335)
(27,152)
(24,489)
(590)
1,590
6,579
26,593
(44,062)
On the 29 March 2017, the Company announced the formation of the Tricoya Consortium and as part of this, funding
was agreed with BGF (Business Growth Fund). In addition to the issue of the Loan Notes, which have since been repaid
as part of the Group re-finance in October 2021 (see note 30), the Company issued 8,449,172 options over Ordinary
Shares of the Company to BGF exercisable at a price of £0.62 per Ordinary Share at any time until 31 December 2026
(the ‘Options’).
At 31 March 2023 a total 8,449,172 Options exist attributable to BGF. This represents 3.9% (2022: 4.4%) of the issued
share capital of the Company as at 31 March 2023.
See notes 30 & 35 for details on the convertible loan agreed with De Engh BV Limited.
Lease creditors of €4,735,000 as at 31 March 2023 (2022: €5,217,000) relates to various offices, land, equipment and
cars that the Group leases (see note 17).
Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while
maximising the return to shareholders.
The capital structure of the Group consists of cash and cash equivalents and equity attributable to owners of the
parent Company, comprising share capital, reserves and accumulated losses.
The Board reviews the capital structure on a regular basis. As part of that review, the Board considers the cost of
capital and the risks associated with each class of capital. Based on the review, the Group will balance its overall capital
structure through new share issues and the raising of debt if required.
The Group’s strategy is to maintain a Net Debt/EBITDA ratio of below 2.5x over the longer term while remaining within
covenant levels set in its ABN Amro facility. One of the key covenants under the ABN Amro facility is the Net Debt/
EBITDA ratio based upon the results and assets which are 100% owned by the Company, with the covenant test
reducing over time from an initial maximum of 4x to 2.5x. On this basis, Net Debt/EBITDA ratio was calculated at 1.3
for the year ending 31 March 2023.
No final dividend is proposed in 2023 (2022: €nil). The Board deems it prudent for the Company to protect as strong
a statement of financial position as possible during the current phase of the Company’s growth strategy.
Financial Instruments by category
2023/ €‘000
Financial assets
Trade and other receivables
Financial asset investments
Derivative financial instruments (FX forward)
Cash and cash equivalents
Total
2022/ €‘000
Financial assets
Trade and other receivables
Financial asset investments
Derivative financial instruments (FX forward)
Cash and cash equivalents
Total
Fair value
hierarchy
At amortised
cost
At fair value
though profit
or loss
At fair value
through OCI
Level 2
Level 2
15,552
–
–
26,593
42,145
–
–
–
–
–
–
–
–
–
–
Fair value
hierarchy
At amortised
cost
At fair value
though profit
or loss
At fair value
through OCI
Level 2
Level 2
13,898
–
–
42,054
55,952
–
–
3
–
3
–
–
–
–
–
Total
15,552
–
–
26,593
42,145
Total
13,898
–
3
42,054
55,955
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
164
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Financial Statements continued
for the year ended 31 March 2023
165
33. Financial instruments continued
Financial instruments continued
2023/ €‘000
Financial liabilities
Borrowings–loans
Lease liabilities
Trade and other payables
Value Recovery Instrument (‘VRI’)
Derivative financial instruments (FX forward)
Total
2022/ €‘000
Financial liabilities
Borrowings–loans
Lease liabilities
Trade and other payables
Fair value
hierarchy
At amortised
cost
At fair value
though profit
or loss
At fair value
through OCI
(65,920)
(4,735)
(17,942)
(1,383)
–
(89,980)
Level 2
Level 2
–
–
–
–
–
–
–
–
–
–
–
–
Fair value
hierarchy
At amortised
cost
At fair value
though profit
or loss
At fair value
through OCI
(63,989)
(5,217)
(16,655)
–
–
–
–
–
–
–
–
–
–
Total
(65,920)
(4,735)
(17,942)
(1,383)
–
(89,980)
Total
(63,989)
(5,217)
(16,655)
–
(85,861)
Derivative financial instruments (FX forward)
Level 2
–
Total
(85,861)
Money market deposits are held at financial institutions with high credit ratings (Standard & Poor’s rating of A).
All assets and liabilities mature within one year except for the lease liabilities, for which details are given in note 17 and
loans, for which details are given in note 30.
Trade payables are payable on various terms, typically not longer than 30 to 60 days with the exception of some major
capex items.
Market risk
Credit risk management
The Group is exposed to credit risk due to its trade receivables from customers and cash deposits with financial
institutions. The Group’s maximum exposure to credit risk is limited to their carrying amount recognised at the balance
sheet date.
The Group ensures that sales are made to customers with an appropriate credit history to reduce the risk where this is
considered necessary. The Directors consider the trade receivables at year end to be of good credit quality including
those that are past due (see note 22). The Group is not exposed to any significant credit risk exposure in respect of
any single counterparty or any Group of counterparties with similar characteristics other than the balances which are
provided for as described in note 22.
The Group has credit risk from financial institutions. Cash deposits are placed with a Group of financial institutions with
suitable credit ratings in order to manage credit risk with any one financial institution. All Financial institutions utilised
by the Group, and with which the Group holds cash balances have investment grade credit ratings.
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board, which has built an appropriate liquidity
risk management framework for the management of the Group’s short, medium and long term funding and liquidity
management requirements. The Group manages liquidity risk by maintaining adequate reserves and banking facilities
by continuously monitoring forecast and actual cash flows and matching the maturity profile of financial assets and
liabilities. See note 17 & 30.
Fair value of financial instruments
In the opinion of the Directors, there is no material difference between the book value and the fair value of all financial
assets and financial liabilities.
34. Capital Commitments
Contracted but not provided for in respect of property, plant and equipment
2023
€’000
–
2022
€’000
8,327
Included in the above, are amounts relating to the Tricoya plant under construction in Hull and committed items related
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and
to the Reactor 4 expansion project in Arnhem.
interest rates.
Financial risk management objectives
The above table excludes the remaining cash committed to be contributed to Accoya USA. See note 29 & 30.
The Group’s treasury policy is structured to ensure that adequate financial resources are available for the development
of its business whilst managing its currency, interest rate, counterparty credit and liquidity risks. The Group’s treasury
35. Related party transactions
Loan from De Engh BV Limited
strategy and policy are developed centrally and approved by the Board.
Foreign currency risk management
The Group’s functional currency is the Euro with the majority of operating costs and balances denominated in Euros.
An increasing proportion of costs will be incurred in pounds sterling as the Group’s activities associated with the
Tricoya plant in Hull increase, although future revenues will be in Euros or other currencies. Equity contributions into
Accoya USA and a smaller proportion of revenue and expenditure are incurred in US dollars and expenditure is also
incurred in pounds sterling. In addition some raw materials, while priced in Euros, are sourced from countries which
are not within the Eurozone. The Group monitors any potential underlying exposure to other exchange rates.
If exchange rates changed by 5% from exchange rates at 31 March 2023, the effect on the P&L from the revaluation of:
• Trade Receivables – P&L impact would not be material. The details of the Trade receivables per Currency is disclosed
As part of the Accoya USA JV funding arrangements, Accsys provided a $20 million Letter of Credit (‘LC’) to FHB
(see note 30 & 32). To support the LC, Accsys agreed a €10 million convertible loan with De Engh BV Limited (‘De Engh’)
in March 2022, an investment Company based in the Netherlands (the ‘Convertible Loan’) and a Accsys shareholder
holding 10.57% of Accsys’ issued share capital at 31 March 2023. The Convertible Loan proceeds were placed with ABN
Amro solely as cash collateral to enable ABN Amro to grant the $20 million LC to FHB.
The Convertible Loan is unsecured and carries an interest margin of 6.75% above Euribor. If the Convertible Loan is not
repaid within two years, De Engh has an option (from the end of year two) to convert the outstanding loan balance to
ordinary shares in Accsys at €2.30 per share, otherwise the interest rate increases by 2% in year three and by a further
2% the following year if the loan has not been repaid or converted after 3 years. The maximum term of the Convertible
Loan is 3.5 years from March 2022.
in note 22 with the US Dollar receivables held in Titan Wood Inc, which has a US Dollar reporting currency.
36. Events occurring after 31 March 2023
• Trade payables – P&L impact would be approximately €211,000.
Interest rate risk management
Some of the Group’s borrowings have variable interest rates based on a relevant benchmark (ie. EURIBOR) plus an
agreed margin. Surplus funds are invested in short term interest rate deposits to reduce exposure to changes in
interest rates. The Group does not currently enter into any interest rate hedging arrangements, although will review
the need to do so in respect of the variable interest rate loan facilities.
There have been no material reportable events since 31 March 2023.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
166
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
167
Company Statement of Financial Position
as at 31 March 2023
Company Statement of Changes in Equity
for the year ended 31 March 2023
Non-current assets
Investments in subsidiaries
Right of use assets
Financial asset at fair value through profit or loss
Current assets
Debtors
Cash at bank and in hand
Creditors: amounts falling due within one year
Net current assets
Creditors: amounts falling due after more than one year
Net assets
Capital and reserves
Called up Share capital
Share premium account
Reserve for own shares
Capital redemption reserve
Profit and loss account
Total shareholders’ funds
Note
2023
€’000
2022
€’000
4
5
6
17,384
17,018
3
–
26
–
17,387
17,044
287,481
12,062
261,139
9,841
299,543
270,980
7
(22,485)
(14,113)
277,058
256,867
8/9
(50,288)
(52,340)
244,157
221,571
10
10,963
250,717
(8)
148
(17,663)
244,157
9,638
223,326
(6)
148
(11,535)
221,571
The financial statements were approved by the Board and authorised for issue on 26 June 2023 and signed on its
behalf by:
Stephen Odell
Director
Steven Salo
Director
The notes on pages 168 to 174 form an integral part of the parent Company financial statements.
Balance at 1 April 2021
Loss for the financial year
Share based payments
Shares issued
Premium on shares issued
Share issue costs
Balance at 31 March 2022
Loss for the financial year
Share based payments
Shares issued
Premium on shares issued
Share issue costs
Balance at 31 March 2023
Called up
Share capital
€000
Share
premium
account
€000
Capital
redemption
Reserve
€000
Own Shares
€000
Profit and loss
account
€000
Total
Shareholders
Funds
€000
8,466
189,598
148
–
–
1,172
–
–
–
–
–
35,922
(2,194)
–
–
–
–
–
9,638
223,326
148
–
–
1,325
–
–
10,963
–
–
–
28,477
(1,086)
250,717
–
–
–
–
–
(36)
–
–
30
–
–
(6)
–
–
(2)
–
–
(6,863)
(5,092)
463
(43)
–
–
(11,535)
(6,472)
366
(22)
–
–
191,313
(5,092)
463
1,159
35,922
(2,194)
221,571
(6,472)
366
1,301
28,477
(1,086)
148
(8)
(17,663)
244,157
The profit and loss account includes €8,010,000 of non-distributable reserves arising from the liquidation of Accsys
Chemicals Limited in the year ended 31 March 2007. The profit and loss account also includes €10,871,000 of non-
distributable reserves relating to share based payments.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE
168
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
Notes to the Company Financial Statements
for the year ended 31 March 2023
169
1. Accounting policies
Deferred taxation
The principal accounting policies applied in the preparation of these financial statements are set out below.
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment
These policies have been consistently applied to all the years presented, unless otherwise stated.
of certain items for taxation and accounting purposes except for deferred tax assets which are only recognised to
Basis of preparation
The separate financial statements of Accsys Technologies PLC (‘the Company’) have been prepared in accordance with
Financial Reporting Standard 101, ‘Reduced Disclosure Framework’ (FRS 101) for the year ended 31 March 2023. The
the extent that the Company anticipates making sufficient taxable profits in the future to absorb the reversal of the
underlying timing differences. Deferred tax balances are not discounted.
Dividends
financial statements have been prepared under the historical cost convention, as modified by the revaluation of land
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid.
and buildings and derivative financial assets and financial liabilities measured at fair value through profit or loss, and in
Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
accordance with the Companies Act 2006.
The preparation of financial statements in conformity with FRS 101 requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting
policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are
significant to the financial statements are disclosed in note 2 of the Group financial statements.
The following exemptions from the requirements of IFRS have been applied in the preparation of these financial
statements, in accordance with FRS 101:
• The Company has taken advantage of the exemption in FRS 101, and has not disclosed information required by the
standard as the consolidated financial statements, in which the Company is included, provide equivalent disclosures
for the Group under IFRS 7 ‘Financial instruments: disclosures’.
• The Company has taken advantage of the exemption available under FRS 101 and not disclosed related party
transactions with wholly owned subsidiary undertakings.
Financial assets
Debtors & Cash at bank and in hand
The Company follows the Group’s accounting policies for Debtors and Cash. See note 1 to the Group financial
statements.
Financial liabilities
Other financial liabilities
Trade payables and other financial liabilities are initially recognised at fair value and subsequently carried at amortised
cost using the effective interest method.
Accounting judgements
In preparing the Financial Statements, management has to make judgments on how to apply the accounting policies and
make estimates about the future. The critical judgements that have been made in arriving at the amounts recognised in
the Financial Statements and the key sources of uncertainty that have a significant risk of causing a material adjustment
• The Company has taken advantage of the exemption available under FRS 101 and the requirements of IAS 7 to not
to the carrying value of assets and liabilities in the next financial year are discussed below:
disclose a Statement of Cash Flows.
As permitted under section 408 of the Act the Company has elected not to present its own profit and loss account for
the year. The loss for the financial year was €6,472,000 (2022: €5,092,000).
Going concern
The Company from a going concern perspective is inextricably linked to the Group. As explained in note 1 to the
Financial asset at fair value through profit or loss
The Company has an investment in listed equity shares carried at nil fair value as a reliable fair value cannot be obtained
since there is no active market for the shares and there is currently uncertainty around the future funding of the
business. The Company makes appropriate enquiries and considers all of the information available to it in order to
determine the fair value.
Group’s consolidated financial statements, the Directors have concluded that it is appropriate to prepare the Group’s
Carrying value of interCompany receivables and investments in subsidiaries
consolidated financial statements on a going concern basis. This conclusion also applies to the preparation of the
Company’s financial statements for the reasons set out in that note.
Investments
Except where a reliable fair value cannot be obtained, unlisted shares held by the Company are stated at historical cost
less any provision for impairment.
Share based payments
When the parent entity grants options over equity instruments directly to the employees of a subsidiary undertaking,
then in the parent Company financial statements the effect of the share based payment is capitalised as part of the
investment in the subsidiary as a capital contribution, with a corresponding increase in equity.
The fair value of the options granted is measured using a modified Black Scholes model, taking into account the terms
and conditions upon which the options were granted. The amount recognised as an expense is adjusted to reflect
the actual number of share options that vest only where vesting is dependent upon the satisfaction of service and
non-market vesting conditions.
Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest
The recoverable amounts of these balances have been determined based on value in use calculations. These
calculations require the use of judgements in relation to discount rates and future forecasts. The recoverability of these
balances is dependent upon the level of future licence fees and manufacturing revenues relating to Group companies.
While the scope and timing of the production facilities to be built under the Group’s existing and future agreements
remains uncertain, the Directors remain confident that revenue from own manufacturing, existing licensees, new
licence or consortium agreements will be generated, demonstrating the recoverability of these balances.
2. Profit and loss account
A loss of €6,472,000 (2022: €5,092,000) is dealt with in the Company financial statements of Accsys Technologies PLC.
The Directors have taken advantage of the exemption available under section 408 of the Companies Act 2006 and
not presented a profit and loss account for the Company. Fees payable to the Company’s auditors for the audit of the
Group’s annual financial statements was €183,000 (2022: €145,000). Fees payable to the Company’s auditors for the
audit of the Company’s subsidiaries was €205,000 (2022: €110,000), fees payable to Component auditors for audit
of subsidiaries was €182,000 (2022: 117,000), fees payable for audit related assurance services and was €nil (2022:
€36,000). Additional audit fees were agreed for the 2022 audit of €170,000 which are not included in the numbers
above, including €80,000 for fees payable for the audit of the Group’s annual financial statements and €90,000 for
at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on
fees payable for the audit of subsidiaries.
the number of options which eventually vest. Market vesting conditions are factored into the fair value of the options
granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The information disclosed in the Group’s consolidated financial statements under IFRS2 ‘Share-based payment’ is within
note 14, providing further information regarding the Company’s equity settled share based payment arrangements.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 170
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
171
Notes to the Company Financial Statements continued
for the year ended 31 March 2023
3. Employees
The principal activities of these companies were as follows:
The Company had no employees other than Executive Directors (2023: 2 and 2022: 2) during the current or prior year.
Non-executive Directors received emoluments in respect of their services to the Company of €442,000 (2022: €375,000).
Details have been included in the Remuneration Report. The Company did not operate any pension schemes during the
current or preceding year.
4. Investments in subsidiaries
Cost
At 1 April 2021
Share based payments
At 31 March 2022
Share based payments
At 31 March 2023
Impairment
At 1 April 2021 and 1 April 2022 and 31 March 2023
Net book value
At 31 March 2023
At 31 March 2022
At 31 March 2021
€’000
21,235
463
21,698
366
22,064
4,680
17,384
17,018
16,555
The Directors have considered the recoverability of the carrying values, taking into account the net assets as well as
the long term expected performance of the subsidiaries and do not consider that any impairment is currently required.
The recoverable amount is determined based on a value in use calculation which uses cash flow projections based on
Board approved financial budgets. Cash flows have been projected for a period of 5 to 7 years plus a terminal value
discounted at a pre-tax discount rate of 13.5% per annum (2022: 10.5%) and a 1.8% to 2.5% growth rate to determine
their present value. The key assumption used in the value in use calculations is the level of manufacturing revenues and
future licence fees estimated by management over the budget period. These have been based on past experience and
expected future revenues but are limited to existing assets and those under construction.
The following were the principal subsidiary undertakings at the end of the year and have all been included in the
financial statements:
Subsidiary undertakings
Titan Wood Technology BV (Netherlands)
Titan Wood BV (Netherlands)
Titan Wood Limited (UK)
Titan Wood Inc (USA)
Accsys (Accoya USA) Holdings LLC (USA)
Accsys USA Holdings Inc (USA)
Tricoya Technologies Limited (UK)
Tricoya UK Limited (UK)
Accoya Color UK Limited (UK)
Joint venture undertakings
Accoya USA LLC (USA)
2023
% shares and
voting rights held
2022
% shares and
voting rights held
100
100
100
100
100
100
100
100
100
60
100
100
100
100
100
100
77
47
100
60
Class
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
The shares in Titan Wood BV, Titan Wood Inc, Accsys (Accoya USA) Holdings LLC, Accsys USA Holdings Inc, Accoya USA
LLC, Accoya Color UK Limited, Tricoya Technologies Ltd and Tricoya UK Ltd are held indirectly by the Company.
Titan Wood Technology B.V. *
The provision of technical and engineering services to licensees, and the technical development
Titan Wood B.V. *
Titan Wood Limited **
of acetylation opportunities.
The manufacture and sale of Accoya acetylated wood.
Establishing global market penetration of Accoya and Tricoya as the premium wood and wood
elements brands respectively for external applications requiring durability, stability and reliability
through the licensing of the Group’s proprietary process for wood acetylation.
Titan Wood Inc. ***
Provision of Sales, Marketing and Technical services.
Accsys (Accoya USA) Holdings LLC ***
Holdings Company
Accsys USA Holdings Inc ***
Holdings Company
Tricoya Technologies Limited **
Engaged in the commercialisation of technology for the production of Tricoya Wood Elements
around the world.
Tricoya UK Limited **
The construction and operation of manufacturing plant for Tricoya wood chips as the premium
wood elements brand for external applications requiring durability, stability and reliability.
Accoya Color UK Limited (UK) **
The manufacture of colored acetylated wood.
Accoya USA LLC ***
The construction and operation of a manufacturing plant for Accoya acetylated wood to serve
the North American market.
Registered office of subsidiaries:
* P.O. Box 2147, 6802 CC, Arnhem, The Netherlands
** 4th Floor, 3 Moorgate Place, London, EC2R 6EA, United Kingdom
*** 5000 Quorum Drive, Suite 620, Dallas, Texas 75254, U.S.A
5. Financial asset at fair value through profit or loss
Shares held in Cleantech Building Materials PLC
2023
€’000
–
2022
€’000
–
Accsys Technologies PLC has previously purchased a total of 21,666,734 unlisted ordinary shares in Diamond Wood
China. On 23 December 2016, Cleantech Building Materials PLC acquired Diamond Wood China. On 19 April 2017
Cleantech Building Materials acquired the 21,666,734 shares previously owned by the Company and in return the
Company has been issued with 520,001 shares in Cleantech Building Materials PLC, a listed Company trading on the
Nasdaq First North market in Copenhagen.
There continues to be no active market for these shares as at 31 March 2023. As such a reliable fair value cannot be
calculated and the investment is carried at a nil fair value (2022: nil).
A total of 498,522 shares were held at 31 March 2023.
6. Debtors
Amounts owed by Group undertakings
Prepayments and accrued income
2023
€’000
2022
€’000
286,862
260,994
619
145
287,481
261,139
The amounts owed by Group undertakings currently have no repayment plans in place, however the intention is for
the Group’s subsidiaries to repay this balance in the future. A repayment plan will be determined and commence for
the loan when the subsidiaries have surplus cash and the Group requires the cash for other purposes. The Directors
have considered the recoverability of the balances, taking into account the net assets as well as the long term expected
performance of the subsidiaries and do not consider that any impairment is currently required. The recoverable amount
is determined based on a value in use calculation which uses cash flow projections based on latest board approved
financial budgets. Cash flows have been projected for a period of 5 to 7 years plus a terminal value discounted at
a pre-tax discount rate of 13.5% (2022: 10.5%) and a 1.8% to 2.5% growth rate to determine their present value.
Refer to note 16 of the Group financial statements for the key assumptions and sensitivity analysis for this calculation.
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 172
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
173
Notes to the Company Financial Statements continued
for the year ended 31 March 2023
7. Creditors: amounts falling due within one year
10. Called up Share capital
Trade creditors
Amounts owed to Group undertakings
Obligation under lease liabilities
Short term borrowings
Accruals and deferred income
The amounts owed to Group undertakings are payable upon demand and are unsecured.
8. Commitments under lease liabilities
Amounts payable under lease liabilities:
Within one year
In the second to fifth years inclusive
After five years
Less: future finance charges
Present value of lease obligations
9. Commitments under loan agreements
Amounts payable under loan agreements:
Within one year
In the second to fifth years inclusive
After five years
Less future finance charges
Present value of loan obligations
2023
€’000
908
11,695
3
9,500
379
22,485
2022
€’000
228
11,708
10
1,869
298
14,113
2023
€’000
2022
€’000
3
–
–
–
3
10
4
–
–
14
2023
€’000
2022
€’000
10,311
52,977
–
(3,500)
59,788
1,935
59,506
–
(7,236)
54,205
The balance relates to loans with ABN and DeEngh. Further details can be found in note 30 of the Group financial
statements.
Allotted–Equity share capital
219,381,693 Ordinary shares of €0.05 each (2022: 192,761,322 Ordinary shares of €0.05 each)
All ordinary shares are called up, allotted and fully paid.
In the year ended 31 March 2022:
2023
€’000
10,963
10,963
2022
€’000
9,638
9,638
In May 2021, 20,005,325 Placing Shares and 2,418,918 Open Offer Shares were issued as part of the capital raise to
fund the Company’s investment in expanding its Accoya business into North America through the construction of a
new Accoya plant in the USA through its joint venture, Accoya USA LLC, with Eastman Chemical Company (see note
29 to the Group financial statements), as well as to provide additional capital to support the Company’s continued
growth. The Shares were issued at a price of €1.65 (£1.40) per ordinary share, raising gross proceeds of €36.7 million
(before expenses).
Between June and September 2021, a total of 629,460 shares were issued following the exercise of nil cost options,
granted under the Company’s 2013 Long Term Incentive Plan (‘LTIP’).
In February 2022, following the subscription by employees in the prior year for shares under the Employee Share
Participation Plan (the ‘Plan’), 189,931 shares were issued as “Matching Shares” at nominal value under the Plan.
In addition, various employees newly subscribed under the Plan for 193,424 Shares at an acquisition price of €2.015 per
share, with these shares issued to a trust, to be released to the employees after one year, together with an additional
share on a matched basis (subject to continuing employment within the Group).
In the year ended 31 March 2023:
In May 2022, 13,793,103 Placing and Subscription Shares were issued as part of the capital raise to strengthen the
Company’s balance sheet, increase liquidity headroom and fund additional costs to complete the Arnhem Plant Reactor
4 capacity expansion. The Shares were issued at a price of €1.45 (£1.23) per ordinary share, raising gross proceeds of
€20 million (before expenses).
Between August and December 2022, 435,774 Shares were issued following the exercise of nil cost options, granted
under the Company’s 2013 Long Term Incentive Plan (‘LTIP’).
In November 2022, 11,875,801 shares were issued to the Tricoya Consortium Partners (INEOS, MEDITE, BGF & Volantis)
at a price of €0.80 (£0.71) per share. This formed part of a Sales Purchase Agreement with the Tricoya Consortium
Partners whereby Accsys acquired the remaining 38.2% holding in TUK that TTL did not already own and the 23.5%
holding in TTL that it did not already own.
In July 2022, 137,665 shares were issued to an Employee Benefit Trust (EBT) at nominal value, as part of the annual
bonus, in connection with the employee remuneration and incentivisation arrangements for the period from 1 April
2021 to 31 March 2022. These shares will vest in July 2023, subject to the employees continuing employment within
the Group.
In January 2023, following the subscription by employees in the prior year for shares under the Employee Share
Participation Plan (the ‘Plan’), 174,144 shares were issued as “Matching Shares” at nominal value under the Plan.
In addition, various employees newly subscribed under the Plan for 203,906 Shares at an acquisition price of €0.81 per
share, with these shares issued to a trust, to be released to the employees after one year, together with an additional
share on a matched basis (subject to continuing employment within the Group).
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE 174
| Accsys Technologies PLC | Annual Report and Financial Statements 2023
175
Notes to the Company Financial Statements continued
for the year ended 31 March 2023
Shareholder Information
11. Reconciliation of movements in shareholders’ funds
Accsys Technologies PLC is a public limited Company incorporated in the United Kingdom
Loss for the financial year
Share based payments charged to subsidiaries
Proceeds from issue of shares
Share issue costs
Shares issued related to Employee share plans
Own shares
Net increase in shareholders’ funds
Opening shareholders’ funds
Closing shareholders’ funds
12. Dividends Paid
Final Dividend €Nil (2022: €Nil) per Ordinary share proposed and paid during year relating to the previous
year’s results
13. Deferred taxation
2023
€’000
(6,472)
366
29,802
(1,086)
(22)
(2)
22,586
221,571
244,157
2022
€’000
(5,092)
463
37,094
(2,194)
(43)
30
30,258
191,313
221,571
2023
€’000
2022
€’000
–
–
The Company has an unrecognised deferred tax asset of €6.7m (2022: €6.4m) which is largely in respect of trading
losses and has been calculated using the tax rate which is expected to be applicable when the tax losses are expected
to be utilised. The deferred asset has not been recognised due to the uncertainty of the timing of future expected
profits of the fellow subsidiary (in which the Company is in the same tax Group) attributable to licensing activities.
14. Guarantee provided to FHB
In March 2022, the Company’s joint venture, Accoya USA agreed an eight-year $70million loan from First Horizon
Bank (‘FHB’) of Tennessee, USA in respect of the construction and operation of the Accoya USA plant and a further
$10 million revolving line of credit to be utilised to fund working capital (see note 29 & 30 in the Group financial
statements). The FHB term loan is supported by Accoya USA’s shareholders, including US$50 million through a limited
guarantee provided on a pro-rata basis, with Accsys’ 60% share representing $30 million (see note 29 in the Group
financial statements).
Directors
Stephen Odell
Sean Christie
Sue Farr
Trudy Schoolenberg
Alexander Wessels
Louis Eperjesi
Steven Salo
Executive Chair
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Chief Financial Officer
Company Secretary
Nick Hartigan
Company Number
Registered Office
05534340
4th Floor
Bankers
Registrars
3 Moorgate Place
London
EC2R 6EA
Barclays Bank
One Churchill Place
London
E14 5HP
ABN AMRO Bank
Velperweg 37
6824 BM Arnhem
The Netherlands
Link Group
Central Square
29 Wellington Street
Leeds
LS1 4DL
NatWest Bank
250 Bishopsgate
London
EC2M 4AA
Independent Auditors
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory auditors
Lawyers
1 Embankment Place
London, WC2N 6RH
Slaughter & May
One Bunhill Row
London
EC1Y 8YY
Joint Broker and Nomad
Numis Securities Ltd
Joint Broker
45 Gresham Street
London, EC2V 7BF
Investec Bank PLC
30 Gresham Street
London
EC2V 7QP
Corporate Access,
ABN Amro Bank N.V.
The Netherlands
Gustav Mahlerlaan 10
1082 PP Amsterdam
Netherlands
Investor Relations
FTI Consulting
200 Aldersgate Street
Barbican
London, EC1A 4HD
OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSGOVERNANCE Accsys Technologies PLC
4th Floor
3 Moorgate Place
London
EC2R 6EA
United Kingdom
+44 (0)20 7421 4300
Accsys®, Accoya®, Tricoya® and the Trimarque Device are registered trademarks owned by Titan Wood Limited (‘TWL’), a wholly owned subsidiary
of Accsys Technologies PLC, and may not be used or reproduced without written permission from TWL, or in the case of the Tricoya® registered
trademark, from Tricoya Technologies Limited, who have exclusive rights to exploit the Tricoya® brand. © Accsys Technologies PLC 2023
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100% of the inks used are HP Indigo ElectroInk which complies with RoHS legislation and meets the chemical requirements
of the Nordic Ecolabel (Nordic Swan) for printing companies, 95% of press chemicals are recycled for further use and, on
average 99% of any waste associated with this production will be recycled and the remaining 1% used to generate energy.
The paper is Carbon Balanced with World Land Trust, an international conservation charity, who offset carbon emissions
through the purchase and preservation of high conservation value land. Through protecting standing forests, under
threat of clearance, carbon is locked-in, that would otherwise be released.