Coillte profits up 79% as company looks to expand in renewable energy


Coillte - the state-owned company operating in forestry, land management, renewable energy and panel products - has announced that 2007 profits were up 79% to €40.1 million - from €22.46 million in 2006.

The main drivers of this strong Group performance were high log and wood panel prices and strong customer demand, which resulted in strong performances by the Forest and Panel Products divisions, in particular.

During the period, Coillte recorded turnover of €318 million - up 48.8% on 2006. Exports accounted for 54% of sales, establishing the Group as an international forestry and forest products business. The largest export market was the UK with  Medite MDF and SmartPly OSB panel products generating the bulk of sales there. The year also saw log sales break the €100 million mark for the first time at €106 million.

During 2007, significant steps were taken to develop Coillte’s recreation offering - supported by Failte Ireland and the Department of Community, Rural and Gaeltacht Affairs. The €5 million ‘Welcome Initiative’ was launched in partnership with Failte Ireland, late in 2007. Approximately 250 kilometres of trails were upgraded and the dedicated recreation website - - was launched. Coillte has over eighteen million visitors to its forests annually, which creates a value to users of €97 million.

The Board adopted a new Corporate Strategy in 2007 to support future development and growth. It focuses on sectors where Coillte has a proven competitive advantage – forestry, land development, panel products and renewable energy - and these will be the main drivers of the business for the next 5 years.

Chairman, Brendan McKenna said - “2007 proved an excellent year - with profits up 79% and turnover reaching €318 million. Our core forestry business had a very strong year and we continue to invest heavily in this business, with €49m invested in 2007 in reforestation, roads, farm partnerships and acquisition of immature forests. These measures will all sustain and enhance the productivity of our estate. Medite Europe has made a very positive contribution in its first year and has become an integrated part of the Group.”

David Gunning, Chief Executive noted - “In line with our Corporate Strategy, we are expanding our current involvement in renewable energy - an area we are uniquely positioned to operate in, given our extensive land holdings across the country and the nature of those holdings. Approximately 20% of the current wind generation capacity in Ireland is on land which was formerly owned by Coillte.

“We are currently 50% partners in 3 joint venture projects with a total generating capacity of approx 130MW. In addition we have also submitted Gate 3 applications for over 900 MW across 17 sites.”

The Group’s forestry business made a strong contribution during 2007, mainly due to strong demand and higher prices for logs. In 2007, Coillte Forest sold 2.56 million m³ of roundwood, which generated €106 million in revenue. The company also had its Forest Stewardship Council (FSC) certification renewed - a clear endorsement that Coillte manages its forests in accordance with strict economic, environmental and social principles.

During 2007, the Group sold approximately 600 hectares of land for a wide range of projects - over 60% of which were for national infrastructure projects, including wind farms. Other projects included land for roads, sports clubs, schools and youth organisations. Significant progress was made in 2007 with the renewable energy strategy, securing Board approval to pursue the development of wind farms.

The Panels business - comprising SmartPly in Waterford and Medite Europe Ltd business in Clonmel - had a good year. SmartPly recorded a good financial outturn in 2007 on the back of a strong production performance.  Medite had a very successful first full year in Coillte’s ownership, delivering a strong financial performance.  A significant fibre optimisation project was initiated at the Medite plant, which will increase operational efficiencies and increase throughput.

2007 Highlights -

  • Strong growth in profit - up by 79% to €40.1 million
  • 2.6 million cubic metres of timber sold
  • Log sales over €100 million for first time at €106 million
  • Capital expenditure of €58.41 million in 2007 - up 18%
  • Turnover up by 48.8% to €318 million
  • Exports accounted for 54% of sales
  • Retained FSC Certification that forests are managed responsibly
  • Integration of Medite into Coillte Panel Products and strong performance in 2007
  • Opening of Lough Key Forest & Activity Park by Minister Mary Coughlan TD
  • Launch of €5 million 'Welcome Initiative' with Fáilte Ireland and completion of trails upgrade and new recreation website
  • Restoration of 2,500 hectares of raised and blanket bogs by EU LIFE Bog restoration projects.

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