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Woodbois reports record revenues, completes sawmill retooling

Increased revenues were achieved without increasing administration expenses, with operating expenses decreasing roughly 20%

Woodbois Limited -

Woodbois Ltd (LON:WBI) said revenues increased by around 48% last year to around US$20mln after four successive record quarters from its forestry and trading businesses.

The sustainable hardwood producer, which manages and operates around 1mln acres of natural forest concessions and associated manufacturing facilities in Gabon and Mozambique, said the increased revenues were achieved without increasing administration expenses.

Moreover, operating expenses decreased roughly 20% year-on-year, the company said.

The trading division’s revenues are expected to come in at US$13mln, with margins improving to 11% from 10% during the first half.

With a Gabon sawmill re-tooled within budget before the year-end deadline, Woodbois said it had immediately realised a “step-change” in recovery rates and the expected resulting increased future profit margins “fully justifies” the capital expenditure and time committed last year.

“The business has continued its rapid and consistent growth path throughout 2019 with revenues once again rebased year-on-year,” said Woodbois chief executive Paul Dolan. 

“Management have also executed effectively on the group's capital expenditure led strategic plans, building Woodbois brand value and positioning the group to achieve significant levels of growth and profitability in the decade ahead.”

The premium quality sawn timber now being produced by the retooled Gabon sawmill is anticipated to lead to this enhanced brand recognition.

Dolan added: “While aiming to continue the delivery of significant levels of top-line growth during 2020, the group will also implement measures to strengthen its cash balance and improve margins, while further leveraging its fixed cost base to improve overall profitability."

Envision, to which the company sold its Tanzanian agriculture business, has not yet paid the agreed initial payment and, with a lack of resolution from mediation, management said they "will now be guided by our legal advisers on next steps".

Quick facts: Woodbois Limited

Price: 2.15 GBX

LSE:WBI
Market: LSE
Market Cap: £30.76 m
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