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Active Energy lifts output from wood fibre business

Active Energy (LON:AEG) told investors it expects to ship over 220,000 tonnes from its wood fibre business this year - a 43% increase on the 154,103 tonnes achieved in 2014 as it reported progress across all operating divisions...

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The firm told investors it expects to ship over 220,000 tonnes from its wood fibre business this year

Active Energy (LON:AEG) told investors it expects to ship over 220,000 tonnes from its wood fibre business this year -  a 43% increase on the 154,103 tonnes achieved in 2014 as it reported progress across all operating divisions.

Over the past 30 days, the division has processed and loaded over 42,000 tonnes of  finished product, a record, after 2015 has seen the group upgrade its handling and processing facilities at its plant in Yuzhny Port, Ukraine.

That said, despite profitable trading in the final quarter, the firm has not been able to reverse the losses seen in the third quarter, it revealed, which were due to price increases prior to the Ukrainian unprocessed wood export ban coming into effect, although that ban does not affect Active.

The group runs three operating divisions,  each with a distinct identity - the woodfibre business for MDF manufacturing, a biomass coal replacement business and a forestry management division.

At the latter, joint venture partners are currently finalising a detailed forestry management plan, to include stewardship, management and a number of environmentally-sensitive commercialisation strategies. 

The process is almost complete, and a series of consultation meetings with the Métis Settlement communities and Alberta government representatives are scheduled to take place between December 13 and 18 this year.

Active's chief executive Richard Spinks said: "To quote Aristotle, 'The whole is greater than the sum of its parts', and that is certainly true at AEG. 

"In the past three years we have considerably expanded our original wood fibre processing operations, and simultaneously introduced two entirely new - but complementary - business activities into the company.

"Although each our three trading divisions operate independently, the synergies between them are fundamental to the group's future success.  They not only allow us control of the entire timber supply chain - reducing our reliance on external suppliers and market factors - but enable us to maximise the value and margin potential across all of our activities, and have opened the doors to a number of exciting new market opportunities."

"As an example, introducing AEG CoalSwitch into our forestry development plans has not only dramatically increased the value of the low-grade and waste timber, which can be used as feedstock for fuel production, but has also enabled us to explore the potential for on-site CoalSwitch processing plants and power-generating facilities."

This strategy is now generating considerable interest internationally, said Spinks, who added that the firm was now developing high-level commercial and governmental relationships in each of the countries in which AEG operates. 

"They include the potential to manage in excess of one million hectares of forestry assets, for environmentally-responsible commercialisation using our unique 'forest to factory and fuel' business model."

Active Energy shares eased 3.65% to stand at 4.625p.

Quick facts: Active Energy Group PLC

Price: 0.675 GBX

LSE:AEG
Market: LSE
Market Cap: £8.11 m
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