Coillte announced its results for 2002 following its AGM in Dublin today. The Group reported a slight increase in profits in 2002, up 2% to €18.74 million. The Group performed solidly in most areas with increased log sales, improved performance at OSB manufacturer SmartPly Europe and good results in its land-based businesses.

In the Group's forestry business, Coillte Forest, total log sales revenue increased by 9%. This resulted from a record level of sawlog volume sold of 1.78 million m³, up 6% on 2001, and increased volume of pulpwood sold of 0.93 million m³, up 8%. This is a reflection of strong demand especially for construction timber, and increased demand from SmartPly where pulpwood intake increased by 48%. However, the benefit of higher volume sales was offset by depressed sawlog prices, a change in the product mix sold and increased costs. According to Coillte Chief Executive Martin Lowery future demand for logs is underpinned by significant investment in recent years in modern, competitive sawmilling and panel board processing capacity.

During 2002 Coillte assumed 100% ownership of SmartPly Europe Ltd. This was a strategically important acquisition as it moved the Group firmly into the international forest products business. It also secured an important outlet for pulpwood from Irish forests. SmartPly has a strong market position in Ireland and the UK and demand is continuing to grow at about 30% per annum in Europe. The business continues to be loss making, due to overcapacity in Europe, but losses were halved in 2002. Coillte has to account for 100% of these losses since the date of acquisition, 1 May 2002, compared to 35% in prior years. Coillte is confident that further progress will be made in 2003 towards moving this business into profit as the European market for OSB continues to grow strongly and supply and demand come into balance.

Performance varied in 2002 across Coillte Enterprises, which manages Coillte's non-forestry businesses. Significant progress was made in the Group's land-based businesses and co-development agreements were completed with four significant participants in the wind energy sector leading to the potential development of windfarms on Coillte land. 2002 was a difficult year, however, for Forestry Services (responsible for tree planting) and Nurseries, both of which were severely affected by Government forestry cutbacks announced last November.

Commenting on the performance Coillte Chief Executive, Mr. Martin Lowery, stated that, "Increasing profits in 2002 was a considerable achievement taking into account difficult trading conditions, absorption of 100% of losses at SmartPly compared with 35% in previous years, and the impact of external factors such as Government expenditure cutbacks."

Looking to 2003 Brendan McKenna, Chairman of Coillte said that the Group is firmly focused on managing its forests as efficiently as possible and working with our customers to optimise the value of the forest resource; moving SmartPly into a profitable position by building on progress made since Coillte assumed 100% control; and identifying ways in which business opportunities can be realised by adding value to the Group's land asset.

Further information:
Gerry Egan, Company Secretary: Tel: 01 6635277 / 086 2591409
Máirín Delaney, Public Relations Manager: Tel: 01 6635279 / 086 2529609