ENCE increases its net profit by 115% in the first quarter to stand at € 29.5 million


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24 April 2018.– Ence-Energy & Pulp achieved a net profit of € 29.5 million in the first quarter of the year, representing a 115% increase over the same period of the previous year. The Group’s EBITDA improved by 54% after standing at € 62.9 million. The EBITDA of the Pulp business grew by 80%, driven by a 29% improvement in the average selling price. The EBITDA of the Energy business stood at € 9 million and remains on target to reach € 55 million in 2018.

Ignacio Colmenares, CEO of Ence, said, “Our expectations for the future trend of pulp prices continues to be very favourable. In the short term, the main producers of short fibre worldwide have announced additional price increases due to a tight supply and demand balance. In the longer term, the strength of pulp demand and the lack of new projects to increase production capacity, suggest a scenario of high prices for at least the next three years. In this price context, we reiterate our goal of achieving an EBITDA of more than € 300 million in 2018.”

Investments in ENCE’s Strategic Plan continue their successful execution. In March, a 30,000 ton capacity expansion of the Pontevedra bio-factory was carried out and investments have been made to implement a 80,000 ton expansion of the Navia bio-factory, scheduled for April 2019. In addition, the construction of the new Huelva 40 MW plant is progressing, and it will begin operating at the end of 2019 and generate an EBITDA of € 11 million/year.

ENCE’s strong free cash generation in the quarter has allowed € 17 million to be allocated to investments and net debt to be reduced by € 28 million. The Group’s leverage at the end of the quarter stood at just 0.5 times the EBITDA of the last 12 months, which will allow the company to accelerate the pending investments of the Strategic Plan, while maintaining an attractive remuneration for its shareholders, equivalent to 50% of the earnings per share in three annual payments.