State forestry agency Coillte has posted record revenues of over €420 million for 2021 due to strong demand and higher prices.

As a result of the exceptional financial performance, Coillte has recommended paying its largest-ever dividend to the State of €30 million.

Earnings before interest, depreciation, tax and amortisation (EBIDTA) of almost €160 million were well ahead of the 2020 figure of €66 million, while operating cash levels reached €73 million (up from €24 million in 2020).

The agency’s revenue in 2021 reached €422 million, compared to €285 million in 2020. Operating profit increased from €29 million in 2020 to €124 million last year.

In its annual financial results for 2021, Coillte noted that there was “exceptional global demand” for sawnwood and timber products in its core markets.

The report outlined that the forestry sector, like many others, was impacted by significant pandemic supply chain constraints.

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Commenting on the results the chair of Coillte chief executive, Imelda Hurley, said:

“During 2021, end-market prices for timber and panel board products reached record levels, driven by high demand in the construction and home improvement sectors.

“Pricing was also influenced strongly by a global supply and demand imbalance which created a series of supply challenges in key markets,” she continued.

“When taken together, these factors resulted in Coillte achieving a record financial performance in 2021.

“In the coming years, forestry will play a key role in our economy and society as we deal with the twin challenges of climate action and biodiversity protection,” Hurley said.

Coillte recently launched its new forestry strategic vision which includes the creation of 100,000ha of new forests by 2050.

It also established a new joint venture, FuturEnergy Ireland, with ESB aiming to deliver 1GW of new renewable energy.

Coillte said that the war in Ukraine has quickly emerged as “a defining feature of 2022” with wide-ranging impacts.

Although the market is currently demonstrating solid demand, Coillte noted that the impact of the current “high-inflationary environment” on its cost base “is of significant concern”.

“While there are many unknowns, the company anticipates that its financial returns in 2022 will reflect a material reduction on the record high levels achieved in 2021,” the financial statement concluded.