CBM Cambrex Corp

25 August 2017

CLEANTECH BUILDING MATERIALS PLC, NASDAQ FIRST NORTH, COPENHAGEN

TICKER: CBM

Cleantech Building Materials plc

Unaudited Interim Results to 30 June 2017

Cleantech Building Materials plc ("CBM" or the "Company"), presents its unaudited results for the six months ended 30 June 2017. The financial statements are appended to this announcement.

Business Overview

On 23 December 2016, the Company's shares were admitted to trading on the Nasdaq First North market in Copenhagen and the acquisition of Diamond Wood was completed. With the successful completion of the admission to Nasdaq First North, Copenhagen, our attention has turned to delivering on Diamond Wood's objective of constructing an Accoya® wood factory in China.

Financial Overview

The revenues of the Company and its subsidiaries ("Group") for the six months ended 30 June 2017 fell to €294,000 (six months ended 30 June 2016: €403,000) despite a strong order book during the same period.  This was mainly due to constrained supply of Accoya® wood from the Group's licensor, Accsys Technologies plc ("Accsys").  The growth of the Accoya® brand worldwide, combined with the delayed expansion of Accsys' manufacturing facility in the Netherlands has led to a shortage of supply of Accoya® wood to the Group.  This is likely to be a short-term issue as the first stage of Accsys' expansion is due to be finalised in 2017.  In addition, the Group's own Accoya® wood manufacturing facility is scheduled to commence production during 2019.

The Group realised a net loss of €2,209,000 for the six months ended 30 June 2017 (six months ended 30 June 2016: €1,939,000). The net loss for the current period was mainly due to salaries and professional costs.

Since reaffirming its Accoya® licence with Accsys in 2015, the Group has appointed 11 distributors of Accoya® in the ASEAN region and is currently working on several exciting reference site projects to further build brand awareness. The Group and its distributors are due to attend an Accoya® wood conference in Shanghai during November to further educate and assist distributors with sales of Accoya® wood in their respective regions.

Once the Group is producing its own Accoya® wood, the Board believes the financial performance of the Group will be radically transformed. In the meantime, Accsys has announced it will be increasing the capacity of its Accoya®

 wood factory during 2017, which should help to bridge the gap between demand and supply until the Group's anticipated Accoya® wood facility is in operation.

As at 30 June 2017, the Group had cash and cash equivalents of €1,000 (30 June 2016: €116,000), € Nil (30 June 2016: €4,477,000) in interest-bearing borrowings from independent third parties and net current liabilities of €1,027,000 (30 June 2016: €5,087,000). The Company increased its existing loan facility by a further €2 million during May 2017 to provide sufficient working capital to continue the expansion of its marketing and sales activities in China and the ASEAN markets, and to progress the financing and build plans for its own Accoya® wood factory in China.  The Group continues to closely manage its cash position to ensure that any costs of financing are mitigated as fully as possible.

The interim financial information for the six months ended 30 June 2017 was approved by the Board on 25 August 2017.

Future Developments

The primary strategic objectives for 2017 are to:

1. Secure the financing required to commence the construction of its own Accoya® wood manufacturing facility.

2. Secure a build and operate agreement with an experienced global firm to ensure the Accoya® wood manufacturing facility is constructed and operated efficiently.

3. Grow sales of Accoya® wood both to new and existing distributors and directly to wood manufacturers.

4. Build strong relationships with major Chinese wood manufacturers in anticipation of the forecast significant Accoya® wood sales in China once the Group has commenced its commercial production of Accoya® wood.

5. Develop its marketing and sales initiatives to further enhance the Group's ability to reach its target markets.

The Company has made significant progress towards achieving these objectives during the six months ended 30 June 2017, especially in relation to the expansion of its marketing and sales team and advanced-stage negotiations of an agreement with a Chinese state-owned chemical group for the financing, construction and operation of its own Accoya® wood manufacturing facility in China.

THE DIRECTORS OF CLEANTECH BUILDING MATERIALS PLC ACCEPT RESPONSIBILITY FOR THE CONTENTS OF THIS ANNOUNCEMENT

Further information may be found at the Company's website at www.cbm-plc.com  

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