LONDON (Alliance News) - Oil re-refining group HydroDec Group PLC on Tuesday said it has made "significant progress" towards its objectives since the start of 2016, with its ultimate aim being to achieve a profitable 2016.
At a statement to be made at HydroDec's annual general meeting on Tuesday, Chief Executive Chris Ellis said that, following the disposal of its UK operations announced in March, it has made good progress in the next stage of its plan to refocus on the core transformer oil re-refining technology.
This part of the plan is focused on "delivering increased operational performance, reduced costs and ultimately the achievement of a profitable 2016", Ellis said.
Ellis said the core objective this year has been to optimise the performance of its Canton oil refinery facility in Ohio, US and to increase production levels.
"These improvements have been validated by the significantly lower number of production hours lost due to unscheduled stoppages and the record monthly production performances of the plant in March of 2.6 million litres superseded in May with 2.8 million litres produced," Ellis said.
HydroDec has also been looking to improve the sales mix between the higher margin transformer oil and lower margin base oil produced at its Canton plant, and said it has made "significant improvements in this area". In January transformer oil represented 19% of US volumes sold, and in May this had reached 54% of sales. June's confirmed orders would indicate transformer oil made up 80% of US volumes sold, Ellis said.
The chief executive noted the company's focus on Australia, and said in May the Australian business enjoyed "one of its highest feedstock acquisition months since 2012 and the underlying pipeline is growing steadily".
HydroDec has also lowered corporate costs this year, Ellis said, although it continues to seek to make improvements.
"We expect the benefits from more recently implemented initiatives to filter through in the second half with corporate costs and overheads forecast to reduce by USD767,000 or 40% when comparing the second half of 2016 and second half of 2015," Ellis said.
"Our key objective during the rest of the year is to strengthen margins as we grow market share whilst continuing the program of cost reduction," the chief executive added.
Shares in HydroDec were up 6.9% at 1.95 pence on Tuesday.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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