Coillte to stop selling its land

Coillte is to switch from a sale to a lease model with regard to non-core land assets in a bid to generate recurring income.

The State-owned forestry and renewable energy body is also targeting around a €50m boost to operating cash flow over the next five years which will help it to invest in new areas, pay down debt and pay a larger dividend to the State.

The company, used to a negative cash position in recent years, yesterday reported a 48% rise in operating cash flow to €6.5m for 2015.

Chief executive Fergal Leamy said that figure could rise to €50m-€60m by 2021.

While Coillte made €230m from the sale of land in Co Longford to holiday resort firm Center Parcs last year and sold land in Galway which will house Apple’s largest data centre, Mr Leamy said leasing such land will be a preferable option in future.

Coillte generated a profit of €47.6m last year, up 64%, and increased its annual dividend to the State by 25% to €5m.

Net debt fell by €22.2m to €154m and capital expenditure rose from €49.4m to €82.9m.

Financial close was achieved on three windfarm projects, with three more to follow this year. When the six are functioning they will provide enough energy for 300,000 homes.

Mr Leamy said that Coillte will likely branch out into solar energy farms in the next five years, but only as a complementary addition to its windfarm business.

“Our core foresty division has the potential to be a European leader as the market for timber and fibre doubles over the next 10 years. Our land solutions business has created a significant platform to be a leader in renewable energy and our panels business — recently rebranded as Medite Smartply — has the assets and products to be the number one value-added player in the markets for MDF (medium density fibreboard) and OSB (oriented strand board),” he said.

“We have a great opportunity to deliver a consistent positive cash yield and return to our shareholders from these three businesses while, at the same time, maintaining the public benefits we provide,” he added.

Mr Leamy said Coillte is on track to becoming the best forestry and land solutions business in Europe.


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