Coillte Operating Profit Before Exceptional Items of €35m for 2012

Coillte, Ireland’s leading natural resources company today announced an operating profit before exceptional items of €35m for 2012. The annual results published today, also show the company paid a dividend of €2m to the State. Coillte Group turnover increased by €3m during 2012 to €262.2m an increase of 1%. 

Acting Chief Executive Mr. Gerry Britchfield said “Coillte delivered a strong financial performance in 2012, a challenging year in our main markets, and I am pleased to report that we delivered an operating profit of €35m.”

Coillte employs 1,000 people in Ireland, the UK and Europe, across four main business areas: forestry management, manufacture and export of wood panel products, renewable energy and land management. Export sales account for 56% of Coillte Group turnover and 65% of this figure was sold into the UK market in 2012.

Coillte Forest, the division that manages all aspects of the forestry business, had a satisfactory financial performance in 2012, with prices for both standing and harvested timber performing well.

Mr. Britchfield said “Demand for sawn timber in the UK was strong in the first half of 2012 and this was reflected in demand from Irish sawmills. The second half of the year was significantly more challenging with the UK market once again dipping into recession.

“The construction sector, where Coillte generates the majority of its revenue, remains a challenging environment both domestically and overseas. I am confident however that we can continue to face  these challenges by seeking out new markets and increasing the range of products and services we offer. In 2012 as part of our transformation we restructured our forest business, with a view to enhancing the commercial value of all stages of the forestry production cycle.”

In addition to the business performance Coillte continues to deliver world class recreation facilities managing Ireland’s network of trails, forest parks and recreation sites, as well as managing 20% of its estate for biodiversity. 2012 saw the fifth annual National Trails Day take place across the country with record numbers participating in the initiative. Coillte also made significant progress in the development of the “Wild Nephin” Wilderness Project in Co. Mayo in 2012 which has been built upon during 2013. These are examples of the range of public goods which Coillte provides that have an estimated value of €500m per annum.

Coillte Panel Products which manufactures SmartPly OSB and Medite MDF had a turnover of €154m in 2012. Mr. Britchfield said “In our panel products business, while prices were relatively stable, they were lower than anticipated and this remains a key issue for us in 2013. However, last year we exported to a record 32 countries and 90% of turnover is now derived from export sales, as a result of a strategic plan to seek out new markets for our products.”

“We have also been driving innovation in this area and with this in mind the Board of Coillte approved plans to invest in our SmartPly facility in Waterford Port, subject to shareholder approval. This investment will protect the value of the Irish forest products sector as SmartPly is the primary pulpwood outlet on the island and will underpin 400 direct and indirect jobs in the South East and provide a strong platform for further job creation.”

In 2012 Coillte Enterprise, the venturing division of Coillte Group which seeks to extract value from the Group’s broad asset base, made significant progress in delivering the company’s wind energy strategy and biomass business. Mr. Britchfield said “Coillte is now established as a major player in the wind energy sector, making a real contribution to achieving  the  Government’s renewable energy target of delivering 40% of Ireland’s electricity from renewable sources by 2020.”

Mr. Britchfield also commented on the decision by the Government in relation to the proposed sale of harvesting rights and restructuring of Coillte saying “Coillte fully supports the Government decision and will participate fully and proactively in evaluating how to give effect to a beneficial merger of Coillte with Bord na Mona to create a strong commercial state company operating in the bio energy and forestry sectors.

“Coillte is confident that the outcome of the restructuring process will provide a strong platform to capture the significant future opportunities for growth available to the company and so enhance its performance and contribution to the State.”

Looking forward Mr. Britchfield said “While the economic environment continues to be challenging across Europe, I am confident of another strong performance in 2013 and that Coillte will continue to progress as a company that is recognised as a major player in the wood fibre industry.

“Coillte is committed to our core purpose of enriching lives, locally, nationally and globally through innovative and sustainable management of natural resources,” he said.

In June 2013 Coillte received major international recognition for its sustainability credentials when it was Ireland’s only winner at the prestigious European Business Awards, taking the prize in the category of Environmental & Corporate Sustainability. 15,000 European companies entered the awards and Coillte was one of 10 overall category winners.