Stobart highlights biomass growth in 2014 annual report

By Erin Voegele | March 02, 2015

The Stobart Group has published its 2014 annual report, announcing that its biomass division supplied nearly 1 million metric tons biomass last year, up 42 percent when compared to the prior year.

Tonnage supplied in 2013-’14 exceeded 900,000 metric tons, up from 650,000 metric tons in 2012-’13. This includes solid recovered fuel (SRF) shipped to Denmark and a substantial increase in road exports to Belgium and France. Within the report, the Stobart Group indicates that the 900,000 in tonnage supplied last year included 400,000 metric tons of virgin product that was sourced primarily from fast-growing plantation forestry, much of which achieves chain of supply accreditation from the Forestry Stewardship Council and other relevant bodies. It also includes 500,000 metric tons of life-expired timber, much of which would have been landfilled. The wood waste is processed and marketed by Stobart as fuel, fiber for the paper and box board industry, and raw material for the panel bard used in furniture and construction.

In his report, Andrew Tinkler, CEO of Stobart, said that some major long-term contracts for the biomass division were consolidated last year, including those with Iggesund and Helius. The division also signed 15-year fuel supply agreements with biomass plants at Port Talbot and Evermore, he said.

“The year ahead will see us consolidate our position within the biomass and renewable energy sectors, making co-investments in targeted developments where we can ensure solid and sustainable returns,” Tinkler wrote in his statement.

“Mindful of the importance of the supply element of our biomass business, we have retained the biomass transport business following the recent transaction,” he continued. “This means that our comprehensive offering of fuel source and supply, matched with premier logistics capability, remains fully intact and we are well placed to increase our rate of growth of supply throughout the year.” In his statement, Tinkler explained that the Stobart Group sold a portion of Eddie Stobart Logistics last year. The group, however, has retained the Eddie Stobart brand through a licensing agreement, along with the biomass transport obligations, which comprises 8 percent of the vehicle fleet and is being integrated into the Stobart Biomass fuel supply business.  

In its annual report, Stobart also reported its biomass business has seen an increase in operating margins and has increased its employees by 37.5 percent. Looking forward into 2015, the company expects that trade in both the U.K. and overseas markets will increase, with continued growth in the Belgian and French markets. “To service this business expansion a number of new processing sites are planned, with contracts being put in place with U.K. suppliers of raw materials. Small-scale sales will be an area of development, with volumes supplied to the rapidly expanding poultry biomass heating market and material for health sector CHP plants increasing the development of these markets, reflecting the government’s important Renewable Heat Incentive allowance,” said the Stobart group in its report.

The biomass division reported EBITDA of £4.4 million ($6.76 million) last year, up from £4.1 million in 2013. Revenue for the biomass division was £28.1 million, up from £16.4 million in 2013.

Overall, the Stobart Group reported underlying profit before taxes of £5.4 million, down from £6.3 million during the prior year. Total revenue was £99.18 million, up from £76.79 the previous year. The company reported a loss before tax from continuing operations of £10.2 million, compared to a profit of £3 million before tax from continuing operations in 2013.