German Pellets GmbH, largest producer of wood pellets worldwide, has expanded its leading position in the 2012 business year. Based on provisional figures, Group turnover grew from 286 m. Euro to 519 m. Euro. Earnings before interest, taxes, depreciation and amortisation (EBITDA) grew to a level of 39.6 m. Euro (2011: 29.6 m. Euro); earnings before interest and taxes (EBIT) increased by 8 m. Euro to reach 23.4 m. Euro.
The positive development in business results from the strong demand for wood pellets in almost all Western European countries. Double-digit growth rates for pellet-based heating units and pellet stoves have led to increasing demand for wood pellets in the private consumer market. The corporate client sector has also recorded substantial growth, for instance in supplying heating to residential-property companies, as well as clinics and industrial enterprises. The power-station sector should also be named as a driver of growth, due to the expansion of biomass-fuelled power stations in the United Kingdom, producing electricity and heating from wood pellets. Likewise, the takeover of the Austrian Glechner Group, effective as of 1 January 2012, contributed to the growth in turnover. In acquiring the Glechner Group, German Pellets expanded its production and sales capacity in Austria, an important market for pellets. Overall, German Pellets proved to be in a position to expand its leading position in its Western European sales markets over the last business year. For the first time, FireStixx Holz-Energie GmbH, taken over in the middle of business year 2011, was also consolidated 100 %.
'The development in turnover and earnings in 2012 fulfilled our expectations. Our sales network, and thereby also sales in our core markets - Germany, Austria, Denmark, Italy and Belgium - have grown more rapidly than expected. Added to this, the power-station sector in the United Kingdom has become a further important market. At the same time, in expanding production capacity in the USA, we are ensuring a secure supply of pellets', notes Peter H. Leibold, Managing Partner of German Pellets GmbH.
Positive prospects for the pellet sector
The global pellet market continues to offer good growth opportunities. Pöyry Management Consulting concludes that the demand for pellets is growing by approximately 15 % p.a. on average, and is set to reach 58 m. tonnes in 2020. Key drivers in the private-customer sector are pellets' price advantage compared to fossil-based fuels (up to 40 % in relation to oil and gas) and the trend towards sustainable and crisis-proof supply of heating. The high number of old and inefficient heating units in Western Europe, needing to be substituted in the years to come, will further fuel the market for wood pellets. Take Germany as an example: more than 3 m. heating units are more than 24 years old and attain low levels of efficiency.
In the medium-sized customer segment (industry and trade), there is a continued expansion in the numbers of wood-pellet-based heating systems installed. Beyond this, large energy-supply companies in Europe, above all in the United Kingdom, are to an increasing degree completely converting their power stations to pellets, or respectively it is specifically planned to do so.
Overall, German Pellets is taking it as its basis that the course of growth will continue. The quantities produced by German Pellets in its facilities in the USA are taking on strategic significance. They will contribute to covering the demand for pellets in Europe. The first site, in Texas, is currently entering the production stage. Construction will start in the near future for a second facility, in the wood-rich state of Louisiana. Long-term supply contracts have already been concluded for both sites with European energy-supply companies.
The complete Group accounts for the German Pellets Group will be published at the end of June 2013.