ANNUAL REPORT 2012

Responding to the Challenge

Challenge Achievement Commitment
Feedstock Feedstock Meet the changing needs of our customers and markets as we progress from a traditional peat only business to one that offers a range of sustainable feedstock alternatives. Achieve this by driving continuous efficiency in our supply chain resulting in improved competitiveness. Biomass supply increased We increased our biomass supply to the Edenderry power station to 15.1% of the fuel usage. A continued programme of transformational business change is ensuring that we are addressing the competitive pressures of the markets we serve. We are focused on the sourcing and supply of biomass products to complement our peat resource. This forms the cornerstone of our sustainability agenda in support of Bord na Móna’s vision ‘A New Contract with Nature’. We remain committed to continuous efficiency improvements in our supply chain.
Powergen Powergen The reduction in regulated capacity payments combined with the overhang of excess generation capacity in the market will require the continued drive for improved efficiency. Whilst progress has been made there remains the ongoing challenge to obtain planning consents and grid connections for wind farm developments. Generated renewable electricity increased Turnover increased by €17.9 million, while biomass co-firing achieved 15.1% dilution in the Edenderry power station. The levels of renewable electricity (RES-E) generated increased from 14.4% to 16.6% To build a diversified portfolio of generating assets, whilst decarbonising the electrical power produced. Co-firing with biomass at the Edenderry power station is a key component of this strategy and we remain committed to the target of 30% dilution by 2016. In so doing we will contribute significantly to Ireland’s EU RES-E targets.
Resource
Recovery Resource Recovery
The current economic climate has resulted in significant over capacity in the market and a negative impact on margins. Compliance with the EU Landfill Directive and increasing landfill levies are challenging in the short-term. Domestic customer numbers increased Domestic customer numbers increased to just under 100,000 through a combination of organic growth and the addition of the Kildare and Wexford County Council domestic waste collection services. The first stage of the commissioning of a 25,000 tonnes per annum brown bin composting plant was completed. The focus of our business is to deliver exceptional customer service and to maximise the re-use potential of managed waste materials. Where possible we will process and retain waste materials within the Bord na Móna Group as feedstock for growing media and for power generation.
Environmental
Anua Environmental Anua
The downturn in the construction sector continues to have a corresponding impact on the business and is forecast to continue for the foreseeable future. Tight credit availability and low levels of consumer confidence are impacting negatively on purchasing decisions. Business rebranded ‘Anua’ Our environmental business was rebranded ‘Anua’ during the year to align with our product offer and positioning in export markets. Revenue grew by 3.9% despite the economic challenges. The consolidation of the UK operations into a single unit in Bridgwater, Somerset facilitated good growth in the second half of the year giving optimism for the year ahead. This business is committed to progressing sustainability by providing environmentally friendly clean air and wastewater treatment solutions. This will be achieved through a combination of product, process and customer service innovation.
Retail Retail Increased focus on ‘value’ and a downturn in consumer confidence continue to be significant challenges in the retail business. Export business to the UK is experiencing increasing freight costs as a result of a reduction in inbound volumes. The UK peat dilution agenda will add complexity to our supply chain from procurement to product delivery. New Retail business unit established To respond to these growing challenges we established a new Retail business unit during 2012. New product introductions and increased distribution contributed to an increase in revenues in our horticultural products, up 3.4% year on year. In the UK a partnership with Vital Earth provides a platform for growth in a key market. The creation of the new Retail business demonstrates our commitment to a market-focused and customer-centric organisation with growth ambition. The business will provide a profitable and sustainable product range to satisfy the needs of consumers as they strive for value against a challenging economic backdrop. This will be achieved by creating an innovative culture ensuring focused product development and efficient supply chain capability.