is good business Verdo's CEO Kim Frimer looks back on a year, which with an EBITDA of DKK 260 million and pre-tax profit of DKK 61 million, was yet another financial record result in a time of crisis and difficult market conditions. But most of all, he will remember it as the year when everything went green. "2012 was definitely Verdo's 'greenest ever'. We increased incineration with biomass fuel at our plant in Randers from 98 to 100%, and we now run exclusively on biomass. We received the first deliveries of wood chips by ship from Ghana, and installation of solar cell panels really took off. We also cemented our position as one of Europe's leading distributors of biomass," states Frimer. Good business The reason for green success according to Frimer, is that Verdo does not go in for green energy for the sake of being politically correct. It also has to make good business sense. Verdo is also gearing up within alternative forms of energy, because the world's stocks of fossil fuels are limited. That's why sustainability is an important theme. "Our import of wood chips from Ghana is an excellent example of how we think green at Verdo. Verdo's use of African wood chips from rubber trees is not only good business, but good for the environment. Rubber production is exhausted, and the trees are therefore no further use for their original purpose. They are chipped and shipped to Denmark. One of their best features is that they release a lot less carbon than coal when burned. We can thus combine good business with sustainability," says Frimer. No price rises Revenue generated, including that from trading in biomass, meant that Verdo was able to maintain or even reduce prices to the customer for heating and electricity at a time when energy costs are rising, and many competitors are putting their prices up. The price of heat has even been held for four years in a row. "The profit from our foreign trading in biomass helps keep supply prices steady, and even reduced in some cases for our local customers in Randers, Hobro and
Annual Report 2012
HillerĂ¸d. Having activities which supplement the classic utilities supply business provide us with a big advantage, and contribute to earnings and jobs," adds Frimer. Green heat in Grenaa Verdo's interest in green energy is on the rise. The company bought the Grenaa CHP plant in 2012, and Verdo also boosted the sale of solar cell panel installations to businesses and the public sector, and intensified the sale of heat pumps and wood pellet boilers. "Our plan is to focus and become even better at what we are good at. We have a particularly high degree of expertise in solar cell panels and biomass. We intend to intensify our international trading in biomass over the next few years, including considering the idea of opening our own Asian office, and bolstering distribution in Italy," explains Frimer. No wind energy On the other hand, wind energy is not a field the group intends to explore any further. "Our mission is to create green energy, but that does not mean that we have to have the entire range. So wind energy is not something we intend to specialise in. On the other hand, we are looking into long-term potential with Verdo Hydrogen, in terms of generating green energy solutions. 2012 was a challenging year for Verdo Renewables, whereas 2013 already holds more promise," concludes Frimer. Apart from continued focus on green solutions, 2013 will see more rationalisation, customer focus and increased sales. The group-wide IT-based Work Smarter project is designed to increase efficiency and the quality of internal processes, and another project has been launched to create a more customer-oriented culture.
We combine good business with sustainability
Annual Report 2012