- EBITDA of €61.1m down 15.9% (-€11.6m)
- Turnover marginally up 0.5% to €383.8m (382.0 )
- The company recorded a loss before tax of €2.9 million primarily due to a write down of €23.1m in the value of AES
- Underlying performance strong as profit before tax, excluding impairment at €20.7m
- Average employment increased by 29
- Operational cash flow strong at 42.1m
- Dividend of €4.3m
- Solid start to current financial year with trading ahead of expectations and prior year
Bord na Móna today announced its annual results for last year (year ending March 2012). Despite a solid operating performance, that saw a marginal increase in total revenue, EBITDA was down by 15.9% to €61.1 million from €72.7 million. This decrease in EBITDA is largely attributable to two factors, the prolonged closure of West Offaly Power Station while a refit was being carried out, and also reduced fuel sales resulting from a record mild winter. Notwithstanding the challenges of the previous year, first quarter results for 2012 show the company performing ahead of expectations.
A significant non-cash impairment to the company’s Resource Recovery business of €23.6m has resulted in a loss before tax of €2.9m. The company’s underlying profitability and performance remains strong and, excluding the significant impairment charge, the group made a profit before tax of €20.7m.
This impairment in AES reflects the experience of other businesses in the industry due to the general downturn in the waste market. The company has taken action by focusing on reducing costs and growing market share in its operating footprint, the benefits of which will accrue in the current year.
Other significant results for the year demonstrate the strong underlying performance of the Group and its balanced portfolio that underpins the resilience of the business to unique and specific negative factors.
These results show:
- The group had a strong cash flow before capital expenditure of €42.1 m
- Turnover was €383.8 million, a marginal increase of 0.5% from €382.0 in 2010/2011
- The average number employed in the group increased marginally to 2,141 from 2,112
Bord na Móna Group CEO, Gabriel D’Arcy, said: “This was an extremely resilient performance by a company performing well despite an unusual combination of environmental, economic and industry-based challenges, most of which were outside our control. These results add further impetus for the group to diversify and this year we can report that we have achieved real progress in this area. We continue to drive change and operational efficiency across the company. As part of this we have streamlined our retail operations in fuels and horticulture into one new business unit.
Our performance in 2011/2012 was impacted by a significant impairment charge in AES, our Resource Recovery business. We were also affected by one of the mildest winners in 23 years coupled with the temporary closure of the West Offaly Power station for a planned five month refit.
Since Bord na Móna acquired AES in 2007, the waste industry volumes have shrunk by 30%, while levies have increased by 325% which combined have given rise to a substantial fall in net income. As these industry factors have impacted on AES, we have taken action to improve our performance and made a number of changes in this business and these are already showing a positive impact on trading performance in 2012.
We have previously highlighted the unique and enormous potential of the Midlands region in terms of growth, investment and employment. Last December we announced the results of our analysis that showed our land bank has capacity to generate in excess of 2GW of wind energy. Bord na Móna is in a strong position not only to help deliver Ireland’s 2020 targets for renewable energy but also in parallel to develop a green energy hub for export to the UK, for the following reasons:
- We own the single biggest land bank in the midlands.
- We have already achieved the lowest grid connection costs in the country because our land bank straddles a significant part of the national grid.
- Our expertise in infrastructure planning and proven technical ability in this area Our reputation and long-standing ties to the community
We want to clearly state that we welcome the Minister’s recent announcement regarding energy co-operation with the UK and look forward to supporting initiatives in this area. For Bord na Móna, I’m proud to say this is not just an aspiration, we are already delivering the wind energy potential of the region, in support of national targets, and I am delighted that we have commenced work on our two new wind farm projects which will bring some 120 MW of wind energy on to the grid over the next 24 months. This represents an investment of €160m with some 150 people to be directly employed on the construction, operation and maintenance of these projects in the Midlands.”
We have also taken some further significant steps in our plan to innovate grow and diversify our company. Last December Bord na Móna announced a new collaboration with Enterprise Ireland which has added fresh impetus to the company’s innovation plans and will, in turn, create some 91 new jobs. We also pleased to announce the commissioning of the new 25,000 tonne brown bin composting facility, a vital part of our national infrastructure, at Drehid in Kildare which is in support of national policy in organic waste management.”
Mr D’Arcy concluded “Despite the challenges that it has had to deal with, Bord na Móna is a company that is confident about its future and optimistic about its prospects. In 2008 the company set out its vision for development in the ‘New Contract with Nature’ which placed sustainable business practices at the core of all our operations. This vision allied to the company’s ongoing commitment to responsible, compliant and competitive business activity place Bord na Móna in a strong position as it gears up to lead Ireland’s 21st Century energy transformation.”