TIDMWBI
RNS Number : 4580M
Woodbois Limited
12 January 2023
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014 which forms part of UK
law by virtue of the European Union (Withdrawal) Act 2018
("MAR").
12 January 2023
Woodbois Limited
("Woodbois", the "Group" or the "Company")
Q4 Update
Financial (preliminary and unaudited)
-- $23.1m total revenue FY 2022 vs $17.5m FY 2021, a 32% increase.
-- FY 2022 gross profit up 69% to $5.9m vs FY 2021 of $3.5m.
-- FY 2022 gross profit margin increased to 25% vs 20% in FY 2021.
-- FY 2022 EBITDAS [i] of >$3m was >3x the $1.0m in FY 2021.
-- Finance charge of $1m for FY 2022 vs $0.6m for FY 2021.
-- Q4 2022 revenue rose 25% to $6m vs $4.8m in Q4 2021.
-- Cash balance of $2.3m as at 31(st) December 2022.
-- Period end working capital [ii] of $10.1m, of which inventory
was $4.6m and excluding bank and other loans of $14.3m.
Operational
-- 2022 sawn timber production of approximately 18,600m3, a 42% increase year-on-year ("YOY").
-- 2022 veneer production of approximately 5,200m3, a 38% increase YOY.
-- Installation of second veneer line completed during H2 2022,
with further volume increase expected in 2023.
-- First afforestation application: decision awaited.
-- In Mozambique, conditions remain challenging and the Group
continues to review its strategic options.
-- The search for a further independent non-executive director is in progress.
Reflections on 2022 and outlook for 2023
2022 marked another solid year of progress for the Group with
increased levels of production at both factories in Gabon resulting
in an unaudited revenue increase of 32% to $23.1m and a 69% rise in
Gross Profit to $5.9m. EBITDAS increased by more than 3x.
Sawn timber provided the largest contribution to the growth of
revenues with the investment made in plant and machinery in our
sawmill over the last three years reflected in consistently higher
levels of production. The contribution from sales of veneer was
more muted owing to logistical delays in the commissioning of the
second production line, completed in H2 2022. The shortfall in
expected veneer revenue was partially made up by log sales to other
veneer producers in Gabon.
Our focus on higher value-add products and markets, in
combination with the gradual decline in shipping costs throughout
the year, allowed an improvement in gross profit margins to 25%, up
from 20% in 2021.
We dealt with a number of challenges during 2022, including an
increase in the cost and, at times, limited supplies of diesel, as
well as a later and heavier than usual rainy season severely
affecting forestry operations and transportation of raw material.
The latter led to us shutting our factories two weeks earlier than
planned at the beginning of December. Normal operations have
resumed on time in January.
In 2023 our overriding priority is to generate consistent,
positive cash flow from our substantial forestry assets to ensure
that we continue to grow the business and meet any debt repayments.
The scale at which we are able to grow and generate net cash in the
immediate future will be partially subject to external economic
conditions, which we continue to monitor closely and respond
to.
We will continue to invest in delivering further operational
productivity improvements, development of our in-house systems to
optimise sales of our own products and working towards our FSC
certification, which will continue to be a high priority and for
which we are currently more than 60% complete. The investment and
work that has been undertaken to this point provide grounds for
optimism that the Company will deliver further improvements in
profitability.
Carbon division
Having attended COP27 as part of Gabon's delegation, the Company
remains in close contact with the relevant ministries in Gabon
regarding our application for our first large-scale afforestation
project. An initial, limited pilot planting project will commence
during 2023 either in our concession area or in an area under
discussion with the relevant ministry. This will be scaled up once
any grant of land has been confirmed and the pilot has been proven
successful.
Financing
We are grateful to our largest shareholder, Lombard Odier, for
agreeing to extend the duration of our $1.0m working capital
finance facility. The loan remains fully drawn and is repayable as
receivables are settled, with further re-draw requests remaining at
their discretion . The interest rate remains at 8.5% per annum and
the loan is expected to be amortised and repaid during 2023. We
were also pleased to have been able to expand our working capital
loan with our bank partners by $1m, which was drawn in Q4 2022.
Share capital
Following a final adjustment in relation to the 2017 purchase of
Woodbois Aps, the Company has received 19,138,147 ordinary voting
shares. Following this , the Company's total number of Ordinary
Shares in issue will remain 2,489,988,873 and this will consist of
2,235,850,726 Voting Ordinary Shares, 19,138,147 Treasury Shares
and 235,000,000 Non-Voting Ordinary Shares. The aforementioned
figure of 2,235,850,726 Voting Ordinary Shares may be used by
shareholders in the Company as the denominator for the calculations
by which they will determine if they are required to notify their
interest in, or a change to their interest in the Company under the
Financial Conduct Authority's Disclosure Guidance and Transparency
Rules.
Commenting on today's announcement, CEO Paul Dolan said:
Our team feels justifiably proud of what it has delivered in
2022. We are prepared for the challenges and optimistic for the
outcomes that await us in the year ahead. Plans to continue the
operational and financial growth are in place. Our ambition is to
continue strive for a position of leadership within a fragmented
industry, whilst moving further up the value chain. The headwinds
facing the global economy as we enter 2023 reinforce our management
team's primary focus on becoming cash flow generative on a
consistent and sustainable basis and thence to become dividend
paying .
(i) EBITDAS is a non-IFRS measure and refers to Earnings Before
Interest, Tax, Depreciation, Amortisation and Share based
payments.
(ii) Working Capital is a non-IFRS measure and consists of Cash,
plus Inventory, plus Receivables, less Payables.
Enquiries:
Woodbois Limited +44 (0)20 7099 1940
Paul Dolan - Chief Executive Officer
Carnel Geddes - Chief Financial Officer
Canaccord Genuity, Nominated Advisor +44 (0)20 7523 8000
Henry Fitzgerald-O'Connor
Harry Pardoe
Gordon Hamilton
Background on Woodbois
Woodbois Limited (AIM:WBI) is an African-focused forestry
company, divided into three distinct, but highly complementary
divisions comprising the production and supply of sustainable
African hardwood products, the trading of hardwood and hardwood
products, and a reforestation and carbon credit division.
Woodbois' forestry division has production facilities in Gabon
and Mozambique, managing a total of c470,000 hectares of natural
forest concessions. The trading division comprises a highly
experienced team of timber specialists, who source and supply
sustainable timber to a global customer base. Its proprietary
technology developed in-house, captures, stores and presents data,
providing a matching engine to build scale and optimise trading
opportunities with its global customer base.
The Company's carbon sequestration and trading division was
formed in March 2021 and aims to generate voluntary carbon credits
for corporate partners through the delivery of large-scale
reforestation projects.
The Company's focus on the transparency and sustainability of
its timber operations has been recognised by The Zoological Society
of London, which ranked Woodbois joint sixth in its Sustainability
Policy Transparency Toolkit ('SPOTT") ESG policy transparency
assessments for the worldwide timber and pulp industries for
2021.
Please follow the Company on Twitter: @WoodboisLtd
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END
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