Accsys, which produces Accoya modified wood and Tricoya wood elements for modified wood panels, also said its gross profit increased by 37% to €18.6m driven by higher volumes, improved Accoya gross margin and licence income.

Wood modification is designed to transform plantation softwoods into products whose performance mirrors or exceeds that of durable tropical hardwoods.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of €2.3m for the second half of the year resulted in positive underlying EBITDA for the full year of €0.9m (2018: €3.5m loss). The pre-tax loss was €7.7m (2018: €10.4m loss).

The company also announced that long-serving CEO Paul Clegg is to step down from his role at the end of the year.

Accoya sales volumes were up 16% compared to the previous year, with a 33% increase in the second half (vs H1 2019), benefitting from the third modification reactor coming on stream at the Arnhem production site.

Accoya underlying EBITDA was up 94% to €9m for the year (2018: €4.6m). Sales of Tricoya wood elements to wood-based panel producers MEDITE and FINSA increased by 49% to support seeding of key European markets ahead of Tricoya wood elements production in Hull.

Significant capital investment of €48.2m during the year reflected capacity increases for both Accoya and Tricoya. Further major capacity expansion is taking place as demand is exceeding capacity.

The third reactor is up and running and annualised capacity has increased by 50% to 60,000m3. Plans are progressing to add a fourth Accoya reactor in Arnhem to further increase capacity to 80,000m3.

“We are delighted to report continued increasing demand for our sustainable alternatives to tropical hardwoods, man made plastics and fossil based building materials,” said Accsys CEO Paul Clegg.

“The strong demand for both Accoya and Tricoya continues to be driven by both product quality and their sustainable credentials, reflecting the increasing importance for all building an construction activities to become more environmentally responsible.”

He said construction issues at the new Tricoya wood elements plant in Hull have been resolved and strong sales to partners MEDITE and FINSA underlined the long term potential for the Hull project.