There would seem to be no operational reason for the drop so watching this closely....sub 0.2 and I may well be tempted to add. It's a risk though as the litigation is a big drag (in terms of cash drain and sentiment) but IF we can get positive news there and confirmation of the site of the new plant this could spring higher....sadly Accsys seems to be the slowest of slow burners but I've waited years for it to come good (albeit managing to pick up a bundle of shares when lowly rated) so I'll happily wait a couple more ;-)
Seems to be a run of automatic sells today - maybe an opportunity to top-up coming soon?
10 Jul '14
RE: Growth potential?
I agree. They need the new factory to achive economies of scale in order to bring the price down to be more copmpetitive. This has been touched on in their recent RNS (new factory). Initial demand though appears good and so hopefully this will give them the confidence to invest ( or partner) in a new factory. I concur that while I am sitting on a nice profit I also want some more news before I put any more money in.
9 Jul '14
Having talked to a timber specialist recently I believe that the challenge for Accsys continues to be the high price of its Accoya product which has to compete with similarly-priced tropical hardwoods like Teak that have been used for a long time. Some timber markets tend to be very conservative and resistant to new products. Also the feedstock wood species is Radiata Pine which needs coating as it is otherwise an unappealing colour and may stain without coating. Some of its modified wood competitors are durable without coating. Having said that, although uncoated cladding is widely used, in some markets coating is very popular and Accoya takes the coating well. Accsys have a single plant in Holland at the moment so production is currently limited. Will that change in the near term? Will they have the capacity to support the newly opened US market recently vacated by Eastman due to "the challenging economics of the product market"? I am happy to hold the shares I have which are showing a nice profit but I won't be adding until some of these basic market acceptance issues are clarified.
7 Jul '14
I am in agreement with you. I suspect the next 12 months will be key. 1 Diamond Wood arbitration is put to bed in AXS favour 2 AXS starts to show a profit 3 New plant agreed and works commenced. I have a sneaking suspecion the recent License deal covering the USA will be key especially as there is no competitor and the Americans build with a hell of a lot with Wood. I also think that the DW problem is stopping many other II and PI's from buying more shares. However while I predicted that this should be sorted out by the end of the year I do not have anything to back that up. £750000 worth of legal fees is very high but then again so are the stakes. I understand the Arbitartion process but not sure for example who the Arbitartor will be etc. No doubt this is a complex case and the respective lawyers will love it for the fees.
7 Jul '14
Well the market doesn't seem to have liked the results too much. From my brief view they seemed very much in track but I suppose they were somewhat cautious. Looks like it's more wait and see with Accsys although everything looks to be moving in the correct direction so will look to add if the SP slips further. Sickening to see 10m and now another 1m wasted on Diamond wood, getting that out if the way would be great news.... Add in the upcoming news on a new plant I'm still positive here but must admit was hoping for a bit more guidance re what is required for profitability to be reached.
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