Chemeq boosts manufacturing capacity

By Ruth Beran
Wednesday, 01 February, 2006

Chemeq (ASX:CMQ) has upped the production capability of its Rockingham manufacturing facility, announcing today that it can now produce as much as 280,000 litres of the company's polymeric antimicrobial each year.

In April last year, the Perth-based company said the plant's production levels were up to 100,000 litres of product, or 25 per cent of plant capacity. Ultimately, the plant was expected to reach a production output of 400,000 litres of finished product.

"In December, we advised shareholders that the plant was operating consistently at a rate of about 200,000 litres per annum," said Chemeq CEO David Williams in a statement. "We are now very confident that the plant will achieve 100 per cent nameplate capacity of about 360,000 litres per annum in the first quarter of this year."

Chemeq's investor relations manager, Sarah Thorn, said that when Williams started with the company in August he identified a number of aspects of the plant which needed to be "changed and tweaked".

"It's not one major component of the plant that's been fixed, because the plant is very complex," said Thorn. "It's tweaking different areas, which is what we've been doing since David came on board. [Williams' policy] is that it's not going to be about blue sky announcements, it's going to be about solid performance and ticking it off as we go along -- to get back credibility in the market."

The improvements to the plant have been validated in accordance with Chemeq's GMP registration.

"It has taken time to implement the changes, and validate the batches that go through, so that we're able to say that we have actually upped the production capacity," said Thorn. "This is just a step in the right direction. Obviously the other milestones are to say we're at 100 per cent nameplate capacity and to get sales orders on the board that we can announce. We're on track."

Chemeq's shares were trading at $0.73 at the time of writing, up $0.06 from $0.67 when the market opened today.

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