INTERIM REPORT 1 JANUARY TO 31 MARCH 2015 Inhalt 1. Summary Seite 3 2. Group Report on Developments in the First Three Months of 2015 Seite 5 ...
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Inhalt 1. Summary

Seite 3

2. Group Report on Developments in the First Three Months of 2015

Seite 5


Interim Report 1 January to 31 March 2015

1. Summary In the first months of 2015, the German Pellets Group proved itself to be able to continue its development. Among other things, the measures taken to expand sales operations in the European core markets noticeably contributed to this. Accordingly, in the first quarter of this year German Pellets was able to attain group-wide quantity growth. The last winter was characterised by interchanging colder and warmer periods; all in all, in most sales regions it turned out to be cooler than the immediately-preceding, mild winter. As a result, in the first quarter of 2015 the German Pellets Group was able to increase its total output significantly, to EUR 144.4 m. (previous year: EUR 135.9 m.). At the start of this year, with the successful launch of operations for the second US site operated by German Pellets, namely in Urania, the company consistently continued to pursue the strategy aimed at expansion of international production capacity. These production quantities are already sold on a long-term basis. Substantial steps have already been taken to establish the planned saw-mill and product-sorting capacities at the US site in Woodville. The land purchase was concluded. Having obtained the so-called „air permit“ means that the company has the most important approval for construction. Development works have already started. Completion means that raw-material sourcing is further optimised within the group; at the same time, the company is establishing its position in new stages of the value-creation chain. The timber quantities are sold on a long-term basis. The joint venture with ZG Raiffeisen Energie GmbH, directed at joint pellet sales in south-west Germany, was successfully launched in the first quarter of this year under the name of „best:Pellets Handelsgemeinschaft“. Further market shares were able to be acquired and new sales regions opened up. With the takeover of Nord Energie GmbH & Co. KG in February of this year, the German Pellets Group further expanded its end-customer business in northern Germany. An encouraging factor is the high level of acceptance among Nord Energie customers with regard to German Pellets as a new supplier. Within only a few weeks, a large part of the client base was able to be supplied with German Pellets Premium Pellets for the first time.


Internally, the Group has further developed the professionalism of its operations: Optimisation of sales and better customer-care were points of emphasis in employee-training courses in the first quarter of this year, the aim being to establish a long-term customer-supplier bond based on the Group‘s brands. With a view to the future‘s growth markets, German Pellets is concentrating on France, among other countries. In forming a sales company of its own, the company will position itself on this market on an long-term basis. This spring saw a new impetus from the boilers sector. Germany, Austria and France have improved the subsidy conditions that apply to pellet-fired heating units and pellet stoves, which has directly led to increased demand from private and commercial users for heating facilities. At the same time, German Pellets has extended its sales-promotion operations, acting jointly with leading producers of pellet-fuelled boilers. The development of sales is also favoured by the fact that the competitiveness of wood pellets has been clearly restored in comparison to heating oil, after the ups and downs of the oil price, and the price gap between the two has stabilised. After a new subsidy was announced on the Dutch industrial and power-station market, German Pellets is in discussion with energy groups and brokers. Likewise, other industrial and power-station markets in Europe expect stable growth. It has proved to be the right decision that, over the last year, German Pellets has also made its entry into the market for wood chip. The conclusion from the latest forecasts is that this market will grow at an over-proportional rate in the near future. German Pellets will soon be loading its first ship with wood-chip supplies.

Interim Report 1 January to 31 March 2015


Interim Report 1 January to 31 March 2015

2. Group Report on Developments in the First Three Months of 2015 2.1. Framework Developments in the energy and pellet markets April 2015 saw the ARGUS European Biomass Trading Conference in London, with numerous players from the European and global pellet market taking part. In summary it can be stated that globally a substantial growth in quantities is expected. Insights were provided into the most important power-station companies‘ current plans as regards the conversion to biomass. For the first time, a large part of the discussions was accounted for by the developments on the European markets for heating and also by the latter‘s interactions with the power-station market. London-based Hawkins Wright, the consultancy and news service, assumes as the basis of its current forecast, an increase in the global demand for pellets to 29 m. tonnes by the end of this year (2014: 25 m. tonnes). What Hawkins Wright expects is a growth in global pellet consumption to 54 m. tonnes by 2023; of this, 31 m. would be needed in the industrial and power-station market and 23 m. tonnes in the heating market. In the reporting period the developments on the energy and pellet markets were characterised by the fluctuating oil prices in Europe, among other factors. Thanks to the oil price upturn at the end of the first quarter of 2015, the competitiveness of wood pellets was clearly restored in comparison to other fuels. In Germany, wood pellets‘ price advantage compared to heating oil averaged 20% in March (source: German Pellets Institute – Deutsches Pelletinstitut); in Italy the corresponding figure was even 150%, while in France and Austria the advantage was around 50% Pellets in the heating market The winter of 2014/15 can be summarised as follows: characterised by interchanging periods of cold and warm, this winter was indeed predominantly cooler than the winter of 2013/14, yet it was still milder than the average figure spanning several years (statistical data: daily figures for degrees of temperature – source: Deutscher Wetterdienst (German Meteorological Service)). Accordingly, the first


Global pellet demand for industry and heating, from 2015 to 2023. Forecast by Hawkins Wright research, „The outlook for Wood Pellets“, First Quarter 2015.

quarter of this business year recorded a higher demand for pellets than the corresponding period last year did. This is also reflected in production output in Germany, recording an increase of around 40,000 tonnes in the first quarter of 2015 (2015: 486,630 tonnes; 2014: 447,200 tonnes). However, the second rather mild winter in succession led to price adjustments in the pellet market, the result being that there was only a moderate seasonal price increase in the winter just ended. Compared to the same period last year, prices were lower. In Germany, the price index of the German Wood Fuel and Pellet Association in March 2015 recorded the figure of EUR 255.85 per tonne (March 2014: EUR 273.69 per tonne). At the start of the year, the Italian Government in Rome raised the value-added-tax rate for pellets from 10% to 22%, so as to generate extra state revenue. The calculation is that in that country, recording Europe‘s highest consumption level of pellet-fired heating, additional income of EUR 96 m. can be expected. Market participants are working on the basis that this will have no effect on the dynamic growth in the Italian market for pellets, due to the sustained high prices for fossil-based energies and wood pellets‘ substantial price advantage compared to fossil fuels.

Interim Report 1 January to 31 March 2015

Developments in the pellet-boiler market At the key leading trade fairs in the sanitation, heating and air-conditioning sector at the start of this year, energy efficiency and renewable energies were once again defining topics. It was noted in summary that Europe‘s principal markets for pellet-fired boilers continued to grow in 2014. This will be in the upper single-digit or respectively in the double-digit range – around 12% in Germany, for example; in Austria, the figure is 6% and in Italy 10%. Producers of boilers and components are at the ready with innovations and further developments in boiler technology and in storage. Accordingly, in March, at the world‘s largest trade fair for sanitation, heating and air conditioning – ISH in Frankfurt – a new pellet-based condensing boiler was presented, one that is independent of return temperatures. Up until then boilers were predominantly dependent on low return temperatures of radiant-panel heating systems. Subsidies in Germany, Austria and France increased Well-timed to coincide with the ISH fair in March, the German Government announced that the subsidy rates for renewable heating would rise, with effect from 1 April 2015. Simultaneously, grants were also increased in Austria and in France. In Germany, the subsidy for pellet-fired heating units was raised, with a minimum value of EUR 3,000 (previously EUR 2,400) and a maximum value of EUR 8.000 (previously EUR 3,600). The boiler manufacturers state that this has already led to an upturn in demand. In Austria, the federal (i.e. national-government) subsidy for pellet-fired heating units was raised from EUR 1,400 to EUR 2,000; this can also be added to by existing subsidies provided by the individual Austrian states. France also improved the subsidy conditions applying to pellet-fuelled heating systems as of the start of 2015. This means that, for those upgrading their existing facilities, 30% of the investment costs are now tax-deductible whereas up until then it was 15%. In addition, the subsidy is not dependent on the recipient‘s income, as has been the case before.


Development in heating costs – a European comparison: Wood pellets‘ price advantage in relation to heating oil is clearly restored. Pellet price according to the price index provided by the German Wood Fuel and Pellet Association: oil prices on the cut-off date, according to the energyinformation service; quantities customary in household consumption. Graphic: German Pellets

Pellets in the industrial and power-station market United Kingdom In the UK, what is by quite a margin the largest individual consumer of pellets is emerging: the DRAX power-station in Selby, in the county of North Yorkshire. Annual consumption, currently at around 5 m. tonnes of wood pellets, is set to increase to 7.5 m.; this is due to the conversion of a third power-station block. This power-station thereby represents Europe‘s largest CO2 reduction project, involving a total annual saving of 12 m. tonnes of CO2. In January 2015, the European Union (EU) approved the first British power-station project for the new financialsupport system CfD (Contract for Difference). Approval is expected in the near future for two more sites. CfD offers energy groups in the UK greater planning security and financial security in making the switch from coal to wood pellets. For the autumn of this year, Britain‘s Department of Energy & Climate Change has announced a further allocation round for CfD biomass projects.

Interim Report 1 January to 31 March 2015

The Netherlands In the Netherlands, after negotiations about sustainability criteria and a capping of maximum permissible use of biomass, there will be a resumption of the use of pellets in coal-fired power-stations. From 2015, power-station operators once again receive subsidies for also using wood pellets in coal-fired power stations. According to experts, annual demand could climb as high as 3.5 m. tonnes. Denmark In Denmark, the industrial use of wood pellets continues to be attractive because of the high level of CO2 tax applied to coal. Accordingly, the Danish energy company DONG is pressing ahead with its consistent plan whereby coal will predominantly be replaced by wood fuels. For its Avedøre power station in Copenhagen, the group has begun converting one power-station unit to 100% use of biomass. An annual pellet demand of around 1.5 m. tonnes is expected for this. Another facility being converted is Dong‘s combined heat and power facility in Studstrup; in the future, this will need as much as 800,000 tonnes of wood pellets annually.

Government‘s „Renewable Portfolio Standard“ (RPS) that entered into force in 2014. Initially, 14 of the country‘s energy companies are taking part in this; they are required to produce a defined percentage of their energy by using renewable sources. The latest upturn in demand for wood pellets primarily results from the use of wood pellets in the semi-state-owned group KEPCO. A continuation of robust market growth is expected for the future. Because of the country‘s dearth of forest stocks of its own, most of the wood pellets have to be imported. Demand for wood chip Likewise, at ARGUS there was also much talk of numerous new power-station projects using wood chip. The use of biomass as a long-term option for fuel entails the establishment of new power-stations; these usually use a circulating fluidised-bed combustion system and can thus also use wood chip. In this segment, the expectation at ARGUS is a growth in wood-chip use, rising from 1.5 m. tonnes in 2015 to 6 m. tonnes in 2016.

Sweden According to Hawkins Wright, the 2 m.-ton threshold of pellet consumption in Sweden could be crossed this year for the first time ever. In Sweden the government‘s ambitious climate-protection goals are being put into practice; among other policies, this involves the systematic conversion of combined power-and-heating facilities to the use of wood pellets. Belgium In Belgium, the final decision is expected this summer regarding the conversion of an additional coal-fired power-station to the use of wood pellets. For this, the annual demand is estimated to be around 2 m. tonnes of wood pellets. Asia At the ARGUS conference in London, there was a lot of interest in the developments in Asia‘s markets, especially those in South Korea. Pellet consumption climbed there by 1 m. tonnes within one year, reaching around 2 m. tonnes in 2014. The market-driver is the South Korean


Interim Report 1 January to 31 March 2015

Overall economic framework As was the case throughout the preceding year, the reporting period saw further stable growth in the global economy. In its current (April 2015) world economic forecast, the International Monetary Fund (IMF) takes as its basis 3.5% growth this year and 3.8% in the coming year. Yet the world economic outlook reveals a split. Numerous industrial countries have seen a continuation of the dynamic of growth during the reporting period, whereas in many threshold countries there has been a downturn in terms of growth.

all the greater, Energycomment observes, the longer that this low-price-phase for oil lasts.

In western Europe the economy has continued to recover. An end of the recession made itself felt in most southern countries. In eastern Europe, development is still burdened by the tensions between Russia and Ukraine. The IMF‘s latest forecast for Europe predicts slight economic growth, at 1.5% this year and 1.6% next year. An aside: price-risks on the global oil market The world‘s oil market is currently experiencing unusual efforts by competitors to oust one another out of the market. On the one hand, this is due to over-supply in the market; on the other, the OPEC cartel is lamed in its efforts to agree upon a cutback of production. The result: the market and investors can no longer rely on decades-old mechanisms used in the global oil market. According to a short study produced by Energycomment, capital-intensive oil projects with a long-term focus can be expected to have difficulties in the future with regard to getting the goahead from companies‘ boards of management and from banks. Investment cutbacks today would result in this oil not being available in the 2020s. The study notes that a downturn is already noticeable in America‘s shale oil sector. The production quantities are projected to decline, starting in the early summer, according to the study, with the quantity of active drilling platforms already having been halved. The study goes on to note that, outside the USA, the expansion of production capacity in countries rich in natural resources is endangered because of crises. Libya, Syria, Iraq and Yemen are consumed by civil war. Iran and Russia are having to deal with economic sanctions. Venezuela and Nigeria, it is also noted, are undergoing severe fiscal and domestic-policy crises. Amid a continued increase in global demand for oil, the report points to „huge price risks in the medium term“. The price risk is


Interim Report 1 January to 31 March 2015


Interim Report 1 January to 31 March 2015

2.2. Business development Acquisition of raw materials Due to favourable weather conditions for timber hauling, the first quarter of 2015 featured a good supply situation among some large saw-mill companies. Accordingly, business activity was continuous, at a medium level of economic dynamism. This meant that the pellet industry had sufficient availability of saw-mill residual wood. The amount of felling by the saw-mill industry was noticeably increased in March; this made itself evident on the market for residual wood, in the form of larger available quantities; this meant that, even though a large saw-mill company operated at limited capacity, this exerted no influence on the market for residual wood. Due to the build-up of stocks, the price for residual wood discernibly came under pressure, so spot quantities from Germany and northern Europe were already offered at more favourable conditions. All in all, during the reporting period the German Pellets Group‘s sites were able to be supplied sufficiently with saw-mill residual wood, and price-cuts were already able to be attained for the second quarter of 2015. The market for energy-wood (renewable resources) showed itself in the reporting period as continuing to be stable at a high quantitative level; at the same time, prices took a downturn because of the lower level of demand from heating stations, and it became increasingly problematic to place product with customers. The German Pellets Group was also able to benefit from this. In the course of the first quarter of 2015, there was a strengthening in the demand for imports, both of saw-mill residual wood and of logs; in part, this gave further impetus to the internal German market for residual wood. There was increased dynamism in the level of shipments as part of existing import contracts for residual wood and industrial wood; security purchases by the pulp industry provided the background for this. In Austria, the first quarter of the business year 2015 saw partial restrictions on the supply of wood shavings. In the case of sawdust, it was confirmed that supply available on the market was sufficient. Consistent with the time of year, the first quarter of the current business year saw a partial price increase with regard to saw-mill residual wood.


The supply of saw-mill residual wood was sufficient in the 1st quarter of 2015. Price cuts proved to be able to be attained for the 2nd quarter of 2015.

In the first quarter of this business year, at the site operated by the German Pellets Group in Woodville, Texas, having continuous supply from a regional provider proved its worth. Occasional lower volumes of logs, because of long rain periods in the region, were able to be compensated by the increase in quantities of wood chip and sawdust. Likewise, raw-materials supply was stable for the second production facility in the USA launched at the start of the year, in Urania, Louisiana. Here German Pellets has successfully built up its own chain of suppliers. Sale of pellets In the first quarter of the year, German Pellets was able to boost its turnover group-wide compared to the corresponding previous-year period, benefiting from more favourable weather conditions. In addition, the investments in the expansion of sales are now producing a return. In Germany, German Pellets attained an increase in quantity in the first quarter of 2015, compared to the corresponding previous-year period. Contributions to this came from (among other factors) the takeover of Nord Energie GmbH & Co. KG, based in Riesum-Lindholm, which was positively received by established customers, as well as the successful business-start for best:Pellets Handelsgemeinschaft, a joint venture with ZG Raiffeisen Energie GmbH, formed at the end of 2014. Here growth proved possible due to the expansion of the sales area, among other factors.

Interim Report 1 January to 31 March 2015

Alongside the sales to private consumers, in the reporting period, the German Pellets Group was also able to expand its business in the industrial heating market. Compared to the previous-year period, the quantity sold increased by more than 50% in this business segment. The reasons for this are, firstly, the sustained high quantity of new installations in this segment (growth in 2014: + 20%), because this is where the amortisation periods are particularly short. Secondly, German Pellets has succeeded over the past business year in generating several new orders for the medium-term to long-term. In this segment, the amount of sales staff was increased in the first quarter of this year. At the start of the year, German Pellets expanded its salespromotion activities in cooperation with leading producers of pellet-fired boilers in Germany; it was thus able to increase the quantity of new customers. In Austria, there were further reinforcements to resources in sales, marketing and the vehicle fleet. Market shares were able to be added, with the result that there was growth in quantity and turnover in the first quarter of the current business year, compared to the previous year‘s corresponding period. In Austria also, the mild weather meant that there were only moderate seasonal price increases in the direct business with end-customers.

arrangements. This applies both to the sourcing of electricity for energy companies and to the production of process heat from wood pellets, in the case of industrial companies. German Pellets is currently conducting contractual negotiations in this regard. Responding to the dynamic market development in Asia, since the first quarter of 2015 German Pellets has employed a member of staff in South Korea whose task is to build-up sales. Sales of animal-hygiene products In the animal-hygiene product segment, the first quarter is typically a strong one for sales. The sales figures in this area were able to be maintained at a very good and satisfactory level. In the segment for small-animal-bedding, strongly-profiled advertising initiatives by one particular specialist dealer led to an increase in sales. Participation in current invitations to tender mean that the continuation or respectively the expansion of existing supply contracts in the small-animal-bedding segment can be expected in the course of this business year.

Compared to the previous year, the reporting period also recorded a distinct increase with regard to wood pellets supplied as bagged goods. Accordingly, sales to specialist distribution channels in France were able to be increased by more than 100%, with a double-digit-percentage increase in Italy. With a sales subsidiary in France currently in the process of being formed, German Pellets is moving to capitalise on this market development. A new branch facility is being set up as part of this, with a further increase in the sales force. So as to supply the specialist distribution channels in France and Belgium, German Pellets is now using a port facility in Belgium and bagging the pellets on the spot.

An increase in sales was able to be achieved in the small-animal-bedding segment – here: wood-based clumping litter. Further invitations to tender are in progress.

In the reporting period as compared to the previous year, trade business in the industrial and power-station market grew once again, with further contracts coming into effect. From 2017, the newly-established subsidy arrangements in force in the Netherlands will lead to a significant increase in demand for new quantities ordered in contractual

The horse-bedding and livestock-bedding segment was also able to generate good sales figures and, for the most part, increases. There was also positive sales development for products marketed under the brand name „German Horse Pellets“ and commanding a high margin. A growing


Interim Report 1 January to 31 March 2015

In the reporting period, operations were launched at the US site operated by German Pellets in Urania, Louisiana. Here: the incoming-goods section for saw-mill residual wood at the company site.

rate of export to overseas markets merits mention in this context. Large bales of product are transported in container ships, to Dubai, Singapore and South Korea, as well as other countries in the Far East. The continuation of the supply contract concluded with a major customer in southern Germany being confirmed. At the world‘s largest horse-related trade-fair „Equitana“ in March 2015, at which German Horse Pellets GmbH had a stand, numerous new contacts were able to be established with potential customers. Pellet production

Alongside saw-mill residual wood, it is primarily wood-chip produced internally that serves as a pre-product used for pellet production in Urania.

At the start of the business year, the second US site run by the German Pellets Group, in Urania, Louisiana, began the process of going fully operational, a process to be completed in the second quarter of 2015. Because of what remains a tense situation in terms of rawmaterial supply at the German Pellets Sachsen GmbH facility in Torgau, short-time working was continued during the reporting period. The production quantities are being replaced by merchandise. Site developments have begun to establish saw-mill and product-sorting capacities at the US site in Woodville, Texas. The land purchase was able to be completed during the reporting period. Obtainement of the so-called ‘air permit’ means that the company already has the most important approval for construction.


The vehicle fleet in Urania is at the ready. From here, the pellets are transported to the storage and loading facility at Port Arthur, Texas.

Logistics Due to both the seasonal downturn in freight volume in Germany‘s logistics market and also to the low oil prices, German Pellets was able to secure a reduction on freight rates in the first quarter of the year. Similarly, in the

Interim Report 1 January to 31 March 2015

company‘s own vehicle fleet, costs were reduced during the reporting period, by exchanging vehicles for models with more efficient fuel consumption. The first quarter of 2015 saw a further expansion in the rail-transport consignments of finished goods for dispatch to the most significant European markets. Reportage: Pellets on the move - 20th large ship loaded up in Port Arthur, USA This spring, German Pellets filled up its 20th large shipload at Port Arthur and dispatched a consignment of pellets to Europe. Pellet consignments sent by sea link the USA, as an important provider of pellets, with the European market for pellets. Bulk-goods freighters, able to accommodate correspondingly large loads, make it possible to transport wood pellets efficiently across great distances. With its storage and loading resource in Port Arthur, Texas, on the Gulf of Mexico, German Pellets is able to load bulk-goods freighters up to Panamax class, i.e. with up to 60,000 tonnes. The five pellet-silos in the harbour store up to 75,000 tonnes of wood pellets. For loading the wood pellets onto the bulk-goods freighters, German Pellets uses a loading technique, applied to fine-consistency bulk-goods, that involves encapsulation and the use of filter installations. This enables dust-free loading of the consignment. In Port Arthur, German Pellets can load up to 14,000 tonnes of wood pellets per day,

thereby achieving short down-times for the ships and also efficient logistics in a broader sense. During the filling process, samples are extracted on an ongoing basis; these are examined for parameters of importance for wood pellets, such as heating value, humidity, ash content and bulk density. Via the Gulf of Mexico and the North Atlantic, the ships head for Europe, reaching their destination ports there after 14 to 16 days.

The pellets are transported by truck from the US production facilities, at Woodville and Urania respectively, to the harbour at Port Arthur. Small picture: Unloading product at the harbour.


Interim Report 1 January to 31 March 2015


InterimShip‘s Report 1 January to Arthur. 31 March 2015 arrival at Port The port facility as seen from the silo towers for the pellets.

To guarantee high quality of the wood pellets, prior to each loading of product the freighter‘s storage areas are examined, checking for impurities such as residues of previously-loaded product, as well as for dirt, humidity and rust.

Depending on the ship‘s size, the loading of product can take from two to five days.

The loading facility at Port Arthur can load up to 14,000 tonnes of wood pellets per day.

The pellet-storage facility in Port Arthur: The five silos jointly hold 75,000 tonnes of wood pellets.


Conical piles are distributed; accordingly, optimum use is made of the freighter‘s loading area.

Interim Report 1 January to 31 March 2015

Corporate bond/profit participation rights As of 31 March 2015, the prices quoted for the three bonds issued by German Pellets (WKN: A1H3J6 (term expires 2016), A1TNAP (term expires 2018), and A13R5N (term expires 2019); coupon: each respectively 7.25 %) were, in part, significantly above nominal value. In all instances, throughout their whole terms the bonds are characterised by a stable share-price development, one that is usually significantly above nominal value. This shows the investors‘ great trust in German Pellets as a company and wood pellets as a fuel. Energy management Renewable Energies Act (EEG): Cost-Apportionment At its German production facilities, the German Pellets Group is making use of the limitation that applies to the cost-apportionment forming part of the Renewable Energies Act (EEG); this limitation applies within the framework of the special compensatory ruling. All German Pellets Group‘s production sites in Germany count as energyintensive; according to the certified management system (ISO 50001), they benefit from the limitation set according to the special compensatory ruling. The advantages amount to a single-digit number of millions in the business year 2015. For the first time, the Wilburgstetten site was also included. DIN EN ISO 50001 energy management system In the spring, the recertification audits take place with regard to continuing the validity of the energy-management system certificatein 2015, according to DIN EN ISO 50001. The recertification gives substantial competitive advantages to German Pellets, in the form of the limitation set on the Renewable Energies‘ Act (EEG) cost-apportionment, as well as the reimbursement of the electricity tax. In total, this results in significant financial advantages for German Pellets. The certification contributes to an enhancement of the company‘s image. Functioning energymanagement among the group of companies also makes a constant process of improvement possible in terms of energy-related performance. For the first time, it is the group of companies‘ energy-management appointee who is conducting the internal audit. This will lead to improved quality of the results while simultaneously reducing costs for the audit process.


At the start of the 2015 business year, the process of certification was begun with regard to Glechner Pellets‘ production; this company forms part of the group and is based in Oberweis/Gmunden, Austria. This would mean that all ‚Glechner sites‘ are certified. For two sites – Mattighofen, Austria, and Pfarrkirchen, Germany – first-time certification took place in 2014. Recertification will now take place in the spring, including the facility in Oberweis/ Gmunden, Austria. Obtaining electricity In 2015, at German Pellets‘ German production sites, the company is benefiting significantly from attractive conditions for electricity supply. In this context, it is especially relevant for the German Pellets‘ group of companies to plan on a long-term and sustainable basis, anticipating challenges ahead and guaranteeing a secure and economically-viable supply of energy to its facilities. In the coming years, the costs for sourcing electricity will go down even further, due to favourable contracts already concluded for electricity supply. CO2 certificate At the Wismar and Ettenheim sites respectively, the German Pellets group of companies is operating biomassbased combined heat-and-power plants for producing process heating: these are subject to emissions-trading requirements. For this, the group annually receives an allocation of emission rights in the form of CO2 certificates. As a result, in the first quarter of 2015, German Pellets was able to sell certificates valued at around EUR 560 k. Social-Affairs Report As an average for the first quarter of 2015, the German Pellets Group employed 634 staff (2014: 628). Of these, 427 were manufacturing-staff (previous year: 416), 192 were administrative staff (previous year: 198) and 15 were trainees (previous year: 2014). During the reporting period, a crucial point of emphasis in further-training activities for employees was training courses and coaching in gaining new customers, developing the business with these customers, and providing customer-care.

Interim Report 1 January to 31 March 2015


Interim Report 1 January to 31 March 2015

2.3. Revenue and earnings

Consolidated earnings

Total output Cost of sales and purchased services Gross profit Other operating income Personnel costs Operating expenses EBITDA Net financial result Earnings before depreciation and taxes Depreciation Net income

01.01. to

01.01. to



























Wismar, 30 May 2015

signed Peter H. Leibold Managing Director


Interim Report 1 January to 31 March 2015

German Pellets GmbH Am Torney 2a 23970 Wismar / Germany Tel.: +49 (0) 3841 - 303060 Fax: +49 (0) 3841 - 303069100 [email protected]