In the first half of 2023, Precious Woods' sales amounted to Euro 32.9 million, and earnings before interest and taxes (EBIT) amounted to Euro -0.2 million, or -0.6 %. Sales growth was 5.0 % compared to the same period of the previous year, and EBIT fell by Euro 3.0 million. This disappointing result reflects the difficult economic environment with substantial cost increases.
Working capital increased again by Euro 0.6 million, reaching a new high of Euro 24.8 million. At the beginning of the year, operations in Gabon had to be shut down for about five weeks because diesel supplies could no longer be replenished due to a landslide. Another shutdown occurred in June, lasting several days. Maintenance work was performed earlier than scheduled, compensating for part of the shortfall in production.
The sawmills in both Gabon and Brazil produced 21 % less sawn timber in the first six months. In December 2022, it was not possible to transport the entire harvested volume in Brazil, leading to a shortage of logs in the first half of 2023. Moreover, not all goods ready for shipment could be shipped, because transport routes once again did not function properly. Consequently, the Group’s net result in the first half-year was Euro -3.1 million (same period of the previous year: Euro -0.3 million).
The generated cash flow was below expectations due to the high level of capital tied up in inventory. Debt increased by Euro 1.6 million from the end of the previous year, mainly due to the CHF/EUR exchange rate. The outlook and expectations for 2023 as a whole are being downgraded, given that no positive impulses can be expected from the market environment in the coming months.
Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to Euro 2.0 million (previous year: Euro 5.1 million), corresponding to a margin of 6.1 %. Earnings before interest and taxes (EBIT) reached Euro -0.2 million (previous year: Euro 2.8 million) and a margin of -0.6 %.
The financial result was below the previous year period at Euro -2.2 million (previous year: Euro -2.0 million). The current interest charge amounted to Euro 1.5 million (previous year: Euro 1.3 million). The net result was Euro -3.1 million (previous year: Euro -0.3 million); EUR 0.5 million of this decline was due to exchange rate effects.
Precious Woods is a global leader in the certified and sustainable management of tropical forests.
