Financial Highlights
· Solid performance in terms of revenue from sales of Accoya® wood which increased by 81% to €6.5m (2009: €3.6m);
· Total revenue of €7.2 million (2009: €9.3 million) included €nil attributable to licence income (2009: €5.4m);
· Significant improvement in manufacturing gross margin from 48% loss in 2009 to 2% loss in 2010. Total margin (including licence income) decreased from a 22% profit to a 2% loss;
· Pre-tax loss of €7.6 million (2009: loss of €8.0 million);
· Management action to reduce other operating costs resulted in a decrease by 24% to €7.4m when compared to the same period in previous year (see note 4 for details of other operating costs);

· Net cash position of €6.6 million (2009: €9.5m); and

· In order to meet the expected demand for Accoya®, the expansion of our Arnhem plant is being planned, with the intention of increasing capacity by 50%.

Operational Highlights

· Detailed discussions in progress with potentially significant licensing and strategic partners;

· Record production and sales volume of Accoya® wood from Arnhem production plant, with sales volumes increasing by 93% to 6,537m3 compared to the same period last year;

· Our licensee, Diamond Wood, announced it has signed an agreement with an Asian investor group and the imminent funding of its first Accoya® wood factory in Asia by the end of 2010;

· Three additional distribution agreements signed in the period including a New Zealand distributor and a US tolling agreement making a total of 21 distribution, agency or supply agreements;

· First shipments of Accoya® wood to India;

· Gordon Campbell appointed Chairman replacing Willy Paterson-Brown and Patrick Shanley appointed as a Non-Executive Director;

· Restructuring exercise has resulted in a predominantly new senior management team leading focused business units; and

· Further successful full scale trial production run of the manufacture of Medite Tricoya®.