Business Briefs

By Pellet Mill Magazine | May 29, 2020

Enviva posts strong Q1 results, produces through pandemic
With new workplace safety procedures in place to mitigate the risk of COVID-19 exposure in its U.S. pellet mills, Enviva Partners LP is continuing operations after announcing excellent first quarter financials in late April.

Enviva reported April 30 that its operational and financial results have not been materially impacted by COVID-19 and, in fact, the company’s Q1 2020 net revenue was up nearly 30% overall, or $46 million above the same quarter last year, with net revenue from product sales up $41 million. The company sold 1,004,000 metric tons of wood pellets in the first quarter, compared to 843,000 metric tons the previous year. The sales uptick resulted in net income of $7.6 million, as compared to a net loss of $8.9 million for the first quarter of 2019.

“Despite the COVID-19 pandemic in what is typically our most seasonally challenging quarter, we reported strong first quarter 2020 results representing a significant improvement over the first quarter of 2019,” said John Keppler, chairman and CEO of Enviva. “Thanks to the hard work as well as good, safe decisions and work practices of our teams, our operations continue largely unaffected. While uncertainty remains in the COVID-19 environment, we believe we are well-positioned to continue to maintain stable, growing cash flows that enable us to increase distributions sustainably over time.”

Enviva noted that government-issued guidance identifies biomass and pellet manufacturing facilities as “critical infrastructure,” and that guidance has been followed by states where its plants and terminals are located, meaning its production output has been largely unaffected by the pandemic.  

Financially sound, Drax donates to US communities in need  
Just days after helping communities in need near its U.S. facilities, Drax Group plc released a trading statement in late April confirming the company’s strong financial and operational position and ability to continue supporting its employees and customers during the COVID-19 crisis.

“At present, there has been no disruption to production caused by COVID-19, although the state of Louisiana is experiencing a high number of cases,” the company said in its April 22 trading statement. “The semi-automated nature of the pellet production process limits the need for individuals to be in contact with each other, and this has been enhanced by robust business continuity procedures to further reduce the risk to employees and contractors.”

The company also reported that its biomass supply chain has a high level of operational redundancy designed to mitigate potential disruptions. In addition to its own U.S. plants, Drax also sources biomass from across North America and Europe.

A week before announcing its solid operational and financial footing, the company’s U.S. subsidiary Drax Biomass donated $30,000 to help COVID-19- and tornado-impacted families in northeastern Louisiana and southwestern Mississippi.

Matt White, Drax Biomass senior vice president, said, “The tornadoes experienced by communities across the region in recent days have been devastating and they come at a difficult time as we are all dealing with the impact of the coronavirus pandemic. It’s important to support the people and businesses in the areas where we operate. Our thoughts are with all of those affected by these events.”