Coillte announced its results for 2005 following its AGM in Dublin today.  The Group reported operating profits before exceptional items of €48.51 million, up 13% on 2004.  The underlying business performance was strong with good contributions from the Group's forestry, land development and SmartPly wood panel businesses. 

In the Group's forestry business, Coillte Forests, the volume of logs sold increased by 3% to 2.73 million m3. Sawlog sales increased by 2% to 1.8 million m3 while sales of pulpwood increased by 5% to 920,000 m3. However the margin on log sales decreased by 4%  continuing a downward trend in recent years that is a serious concern to Coillte.

Coillte's land development businesses had a very good year as waste management sites were sold to Cork, Kerry, and Wexford Co. Councils and Coillte also completed the sale of a major windfarm site in Co. Kerry.

SmartPly again performed well in 2005 following a strong performance in 2004.  Volume sales increased though prices were lower than in the previous year.  Investment in  improved process technology increased throughput and reduced unit costs.

Coillte's profit after tax was reduced to €19.65 million as a result of a number of exceptional items.  Coillte implemented an early retirement/voluntary parting scheme during the year under which 90 management/supervisory staff will have left the company by mid-2006.  €10.5 million was provided to cover both the cost of ex-gratia payments and a contribution to the pension fund to cover the additional pension cost for staff departing under the scheme.

The Christmas tree business has been extremely difficult in recent years - over supply in both the Irish and European markets has depressed prices and Coillte, like many other growers, has incurred trading losses. The Group has decided to write down its stock of trees by €4.3m.  The results also include an exceptional impairment provision of €3.25m against the Group's investment in Griffner Coillte Ltd. reflecting the trading conditions encountered by that company during its start up phase.

Coillte's Chief Executive Martin Lowery said that the Group had another excellent trading year.  In addition to increasing operating profits by 13% the Group had capital investment of €48.75 million most of which was invested in reforestation of sites previously harvested, road building, improvement of the estate and afforestation of bare land.  He also said that the net increase in value of forests and land during the year was €26.8 million bringing to €507 million the increase since 1989 when Coillte was set up, a very significant increase in shareholder value.

Looking to 2006 Brendan McKenna, Chairman said that the Group is focused on optimising the production potential of its forests and improving margins to underpin the value of the forest resource.  Coillte is also uniquely placed to meet the land requirements for major national infrastructure projects such as wind farms and will continue to identify innovative ways in which value can be added to the Group's land asset. 

SmartPly has a market leading position in OSB manufacturing and is examining ways to increase the production capacity and improve the cost competitiveness of the business. Griffner Coillte is a premium designer and builder of innovative houses and commercial buildings and the Group plans to consolidate progress made in establishing this business, during 2006.

Coillte also confirmed that it is in negotiations with Weyerhaeuser Company to purchase Weyerhaeuser Europe Ltd's medium density fibreboard business in Clonmel, Co. Tipperary.  This transaction is subject to confirmatory due diligence, Weyerhaeuser and Coillte Board approval and regulatory approval. 

Further information:
Gerry Egan, Company Secretary:  086 2591409
Máirín Delaney, Public Relations Manager: 086 2529609