To our shareholders

Dear Shareholders

Precious Woods was able to increase sales by 21.3 % to EUR 65.9 million in 2022. This was due to increased production volumes, internal effects, and higher sales prices for our sawn timber products. At the same time, we faced massive cost increases, in particular due to higher diesel prices in Gabon. We had to take drastic measures and create provisions at the end of the year. All these effects mean that the operating performance of our companies and employees in Gabon, Brazil, Switzerland, and Trading – but also the progress within our management and process organization – cannot be clearly expressed in economic terms. Overall, we are reporting an EBITDA margin of 20.2 % and an EBIT margin of 10.5 %. Although these margins are smaller than in the previous year, they are still sizeable in my view, with or without considering the valuation effects of the change in biomass.

The question is how you, as shareholders, interpret this result. Allow me to give you my very personal assessment one last time:

Our customers/sales markets

Tropical woods have excellent technical and aesthetic properties. In the wake of the increased general demand for wood and wood-based materials, the demand for sustainably produced wood products made from tropical timber will also increase. Our international, and in Brazil increasingly local, customers appreciate Precious Woods as a partner for secure and sustainable tropical forest management.

Our work

Over many years, Precious Woods has demonstrated that our use of the tropical forests we manage is sustainable, meeting all ecological requirements, preserving the functions of the forest, and making valuable contributions to the protection of biodiversity and the climate. Today, we have the infrastructure and expertise to process and distribute our products and services. We are also able to rely on the specialists and managers of today and tomorrow who are committed to the future and to continue develop the company.

Our business environment

Working with tropical timber in countries such as Gabon or Brazil remains challenging. During my 15 years of work for our company, I have learned to accept the facts, but also to work vigorously on all the tasks we are able to influence. This includes demanding performance, dedication, and flexibility, developing local specialists and managers, but also trusting people who drive our company forward with their knowledge and skills and who never get tired of acting, debating, and pursuing our three goals with persistence and credibility – with their heads, their hearts, and their hands. It’s an easy task to explain the strong development of Precious Woods in a difficult business environment. The key is the people who – at all levels and in all areas – show dedication every day to our company and our mission.

Our potential

I am still convinced that if Precious Woods didn’t exist, we would have to invent it. Our credibility in sustainable tropical forest management is an asset that I believe is very important and significant if we, as a society, are to answer questions about how to deal with forest resources in future. Sustainable forest management – also in tropical forests – continues to be an important concept for solving the imminent challenges. Precious Woods offers the potential to contribute to climate, resource, and energy policy – and, as an employer, to contribute to all tasks aimed at ensuring social, environmental, and economic stability locally in Brazil, Gabon, or even other locations in future.

Our challenges

The further development of Precious Woods requires resources – especially capital. Investments in internal value creation are necessary to enhance customer value and profitability and to eliminate weaknesses. And we see potential to expand our operations. What is still urgently necessary for us, is to refinance our debt capital and repay loans.

Refinancing means that we need additional equity to reduce our interest burden. Our aim must be to reduce debt in relation to the result generated.

Our thanks

First and foremost, we would like to thank you, our shareholders, for placing your trust in us and for supporting us in our mission. We would also like to thank all our lenders for their generous support.

On behalf of the entire Board of Directors, I would like to thank all our employees for their daily commitment and for what they achieve. I would also like to thank the managers in Gabon, Brazil, and Switzerland who guide the company’s destiny.

And I would like to thank my colleagues on the Board of Directors for our good and constructive work together and, in particular, Markus Brütsch for his great dedication.

I am very grateful to have served as part of this extraordinary company, and I will continue to do so as a shareholder. I sincerely wish the future leadership, the Board of Directors, management, and all the employees of Precious Woods every success, good decisions, and the full confidence of our shareholders and investors.

Yours faithfully

Katharina Lehmann

Chairwoman of the Board of Directors