Active Energy, the AIM quoted international vertically-integrated renewable energy, forestry management and timber processing business, announces its final results for the year ended 31 December 2015.
Richard Spinks, CEO of Active Energy said, “This has been a transformational period for Active Energy with our core business, AEG WoodFibre, providing a cornerstone for the development of our diversified operations. We have invested in increasing capacity at AEG WoodFibre, which could increase revenue in 2016 to circa $50 million. With progress also made within AEG Timberlands in Alberta, which we expect to update the market on shortly, we believe we are entering an exciting period with significant milestones, which should have an important impact on the business and begin to show significantly stronger returns for our investors.”
In line with the Group’s strategy, no revenue was derived from the sale of Biomass woodchip during 2015 (2014: $5.9 million). Within AEG WoodFibre, wood chip for MDF trading volumes increased by 43% to 220,748 tonnes from 154,103 tonnes and revenues increased by 40% to $24.378 million from $17.395 million.
The results for 1Q and 4Q were strong, with combined margin per tonne for those two quarters up 57% compared to 2014. Unfortunately the business was negatively impacted in 2Q and 3Q by the Bulgarian and Ukrainian bans on the export of hardwood logs to Turkey. Prior to the ban Bulgaria supplied 11% of the hardwood for Turkey.
The resultant demand for alternative supply from Ukraine and the subsequent ban in Ukraine of the export of whole logs from the country temporarily distorted the market and substantially increased the price of our raw materials for several months. In order to maintain existing business relationships, the Board took the decision to continue to supply its Turkish client base and operated at a significant loss during those two quarters avoiding reputational and reliability damage. The upside to this is that we are now the only accredited supplier to our current clients in the Black Sea region, a 4 reward for our loyalty and recognition of our reliability. The downside is that it impacted heavily on the overall results for the year.
Active Energy has three trading divisions, which operate as independent business units but work together to optimise resources and opportunities: AEG CoalSwitch, AEG WoodFibre, AEG TimberLands.