German Pellets provides update of La. plant in financial report

By Erin Voegele | October 21, 2014

German Pellets has released financial results for the first half of the year, reporting increased net income. The company also indicated its Urania, Louisiana, facility is on track to begin production by the end of the year.

In its financial report for the first half of the year, German Pellets reported consolidated sales of €260.6 million ($333.38 million), which is up 10 percent compared to the first half of 2013. Earnings before interest, taxes, depreciation and amortization (EBITDA) was approximately €25 million during the first half of the year, up from €18.8 million during the first six months of the previous year. Earnings before taxes increased from €4.7 million during the first half of 2013 to €8.3 million for the first half of this year. Net income also increased, from €1.9 million during the first six months of last year to €5.1 million during the same period of this year.

According to German Pellets, the primary driver of growth was the launch of its 551,155-ton-per-year pellet plant in Woodville, Texas, during the third quarter of 2013. Production is expected to begin at the company’s 1.1 million-ton-per-year Urania facility later this year. That plant is the second U.S. pellet plant developed by the company.  

In its first quarter report, German Pellets indicated that the machine parts and parts of the unit are assembled at the Urania facility. The first phase of the project is expected to begin operations before the end of the year. The second phase of the project is currently scheduled for commissioning during the third quarter of 2015.

The company also noted the Woodville plant is producing according to plan, and added that demand for production quantities from the U.S. is slightly above the planned level.

We will be further pursuing our course of expanding U.S. capacities,” said Peter H. Leibold, managing partner of German Pellets GmbH, in a statement. “To access new stages in the value chain, German Pellets is examining options to build up saw-mills and sorting capacities at the U.S. sites.”

The company also indicated it plans to expand its sales network in Europe during the second half of the year. In addition, German Pellets reported that it is in an ongoing dialogue with European energy players interested in converting to wood pellets, as well as industrial plant operators of medium-sized boilers.

German Pellets currently expects its gross performance for the year to be approximately €550 million, with a stable EBITDA ratio at a level comparable to last year. The company operates 21 pellet plants in locations across Germany, Austria and the U.S.