Quadrise Fuels International PLC Directorate Change and Cost Reduction Initiatives (5641N)
August 10 2017 - 2:00AM
UK Regulatory
TIDMQFI
RNS Number : 5641N
Quadrise Fuels International PLC
10 August 2017
10 August 2017
Quadrise Fuels International plc
("Quadrise", "QFI" or the "Company")
Directorate Change and Cost Reduction Initiatives
Quadrise Fuels International plc (AIM: QFI) announces that in
addition to its existing rigorous approach to cost management, the
Company has taken a number of actions to further reduce costs,
whilst retaining its ability to deliver its active projects and
pursue business development opportunities in the power and marine
markets.
Directorate Change
Hemant Thanawala has agreed to step down as Finance Director and
will become a Non-executive Director, with immediate effect. This
enables the Board to restructure and streamline the number of
Executive Directors from three to two. The Company will retain its
focus on sound cash management, allied with strong project
accounting, led by the Financial Controller, David Scott, FCA. The
Finance Director functions will be absorbed within the existing
senior team.
Further Cost Reduction Initiatives
Mike Kirk, Executive Chairman, has agreed to reduce his cash
salary by 50% with effect from 1(st) September 2017 with an uplift
on the deferred element for potential future payment of 25%. In
addition, the Non-executive Directors of the Company, including Mr
Thanawala, have agreed to reduce their directors' fees to GBP24,000
per annum, with the balance being deferred, for potential future
payment with an uplift of 25%.
The General Manager roles have been restructured to enable the
three segments of Refinery, Power and Marine to be covered
effectively by two General Managers. In addition, the laboratory
personnel roles at the Quadrise Research Facility have been reduced
by one.
The Company's advisers have also agreed to significant
reductions in fees.
In total, these actions are expected to deliver annualised
cash-cost savings in excess of GBP500,000, around 18% of the
Company's underlying (non-project specific) annualised costs.
Business Development and Project Delivery
Quadrise continues to invest in its project delivery and
business development capabilities. Maersk's decision to end the
operational and LONO trial early, despite the positive results was
clearly disappointing. However, it was based on a policy decision
by Maersk to use low sulphur fuels, for IMO 2020 compliance and was
not based on any issues with the MSAR(R) fuel - with Maersk having
confirmed that good progress was made and no issues had arisen with
the use of MSAR(R).
Quadrise and many market commentators still believe that the use
of high sulphur fuels in conjunction with Exhaust Gas Cleaning
Systems, or scrubbers, will offer the lowest cost of compliance
with the IMO 2020 sulphur regulations. We will continue to use the
positive results of the trial, together with the interim LONO and
inspection report from Wärtsilä to actively pursue other
opportunities in the marine market.
In the power market, Quadrise has continued to invest
significant senior management time into driving the project in
Saudi Arabia forward and this is delivering substantive progress. A
more comprehensive update will be provided in due course, but the
project remains on track to commence later in 2017.
Mike Kirk, Executive Chairman, said:
"This has been a challenging period for Quadrise and we have
made some important cost reductions to ensure that we can still
actively pursue the significant opportunities for MSAR(R) in the
power and marine markets.
The cost savings are designed to have no impact on our
operational or business development capacity. As part of this
process, Hemant has agreed to move into a Non-Executive role, so
that we can continue to benefit from his experience and knowledge
of the business. I would like to formally thank Hemant for his
contribution to Quadrise over many years as the Finance Director
and I look forward to working with him in his new role as a
Non-Executive Director. I would also like to thank our
non-executive directors and advisers for their support in the cost
reduction initiatives.
We remain motivated and committed to delivering value to
shareholders from our unique technology."
Notes to Editors
QFI is the emerging supplier of MSAR(R) emulsion technology and
fuel, enabling a low-cost alternative to heavy fuel oil (one of the
world's largest fuels markets, comprising over 450 million tonnes
per annum) in the global shipping, refining and power generation
markets.
For further information, please refer to the Company's website
at www.quadrisefuels.com or contact:
Quadrise Fuels International Plc
+44 (0)20 7031
Mike Kirk, Executive Chairman 7321
Nominated Adviser
Smith & Williamson Corporate Finance
Limited
+44 (0)20 7131
Dr Azhic Basirov 4000
Ben Jeynes
Katy Birkin
Broker
Peel Hunt LLP
+44 (0)20 7418
Richard Crichton 8900
Ross Allister
Chris Burrows
Public & Investor Relations
FTI Consulting
+44 (0)20 3727
Ben Brewerton 1000
Sara Powell
This information is provided by RNS
The company news service from the London Stock Exchange
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