Ence – Energía y Celulosa today held a Capital Markets Day in which it has presented to the market its growth strategy for the next five years, both in its pulp business and in renewable energy and forestry area.
As explained by the President and CEO of Ence, Ignacio Colmenares, the company’s strategy is to “promote growth from the biofactory of Navia (Asturias), while we continue with the legal defense of the extension of the concession of the biofactory of Pontevedra.
In the Renewable Energy business, through its subsidiary Magnon Green Energy, the group will continue to focus on its pipeline of biomass and photovoltaic projects. It is also launching other opportunities linked to energy management, biofuels, biogas and storage, thus contributing to the stability of the system and facilitating the incorporation of renewable energy and energy transition.
Along with the executive chairman of Ence, have also participated in this day the CEO of Celulosa, Jordi Aguiló, the CEO of Magnon Green Energy (the subsidiary of Renewable Energy Group), Marc Gomez, and CFO of Ence, Alfredo Avello.
Ence’s commitment to growth in cellulose is embodied in “Navia Excelente”. An investment plan of €105 million, capable of boosting the business and creating value, fully aligned with the notion of circular bioeconomy.
Based in Navia, this initiative includes different projects, focused on the promotion of differentiated products; diversification in Fluff cellulose (special for absorbent hygiene products); and an innovative decarbonisation project, which will reduce the environmental footprint (specifically, the company will reduce its CO2 emissions by 50,000 tonnes per year from 2024, through the recovery of lignin as biofuel), coupled with an improvement in efficiency.
At the same time, the company will continue to defend in court the legality of the extension of the concession for its Pontevedra biofactory. The Supreme Court has recently admitted the appeal against one of the rulings handed down last July by the National High Court. It will be necessary to wait for the High Court to issue a ruling on the matter in the coming months.
In any case, and in compliance with accounting regulations, Ence has already made provisions in 2021 for €200 million, anticipating the potential impact of the closure of this facility.
On the other hand, Ence has big plans for growth in Renewable Energy, which is reflected in the prominence given to its Renewable Energy subsidiary. Precisely yesterday Wednesday was publicly presented the new name and the new visual identity of this subsidiary, Magnon Green Energy, which make visible this firm commitment.
Ence is the majority shareholder of this subsidiary (which also forms part, as a minority partner, the investment fund Ancala Partners), which consolidates its results within the parent company.
The company expects to record strong cash generation in the coming years in all possible scenarios, even in the event of a hypothetical closure of the Pontevedra biofactory, thanks to investments in its Asturian biofactory.
Having already exceeded the hedges and provisions made in 2021, Ence has significant competitive advantages in the two markets in which it operates and has multiple opportunities for value creation, as well as projects that will allow it to grow and maintain a solid balance sheet