Precious Woods Amazon
Difficult first half-year
The production volume in the first half-year was 10 % lower than in the same period of the previous year, amounting to 11 737 m3 (previous year: 13 116 m3). The reasons include later resumption of production in January due to maintenance work as well as overtime compensation from the previous year. Net sales were EUR 5.5 million, 11.3 % lower than the previous year level of EUR 6.2 million. The operating result (EBITDA) shrank to EUR – 0.1 million (previous year: EUR 1.7 million). The delayed sales, increased personnel costs, and the BRL/EUR exchange rate contributed to this worsening of the result. Deliveries were impaired until the beginning of March 2017 due to the strikes at the end of 2016.
Thanks to expansion investments, seasoning capacity was increased by 70 % as of 1 June 2017. This will contribute to higher added value and achievable margins. Changes to the production process and reductions of the teams working in the forest will lead to an increase in productivity. The harvest began in July as planned and will be concluded in December. The order backlog for the new harvest is about 3 months.
The Brazilian government wants to grant concessions for sustainable management of forest areas in accordance with FSC guidelines. Precious Woods is acting in an advisory capacity and is also interested in receiving a larger concession. The goal of this expansion must be to increase the production volume and thus improve economic efficiency. This includes investments in the saw mill that can be financed through local banks.