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Last year, Czech the state enterprise Lesy \u010cesk\u00e9 republiky (L\u010cR) increased its net profit by 83 percent to 5.03 billion crowns (\u20ac195.18 million) from 2.74 billion crowns (\u20ac106.47 million) in 2021. This was the third highest profit in the company's history. The main reason for the increase in profit was the year-on-year increase in wood prices, up to 70 percent. The result was also positively influenced by the gradual management of the bark beetle calamity in all regions, company representatives said recently at a press conference on the company's economy. The company manages almost half of the forests in the Czech Republic.<\/span><\/p>\n \"Over the past three years, there has been a dramatic increase in wood prices, in all categories. Last year, prices were at their peak,\" said economic director Daniel Sz\u00f3r\u00e1d. According to \u0160afa\u0159\u00edk, the change in the structure of the wood business also contributed to the higher profit when the company strengthened the trading of raw wood under its own management. Last year, the company sold 42 percent of the traded wood on its own. The rest was mainly traded by the business partners of the company, which the state forests select for logging and cultivation work in annual tenders. The company sold a smaller part of the wood in so-called standing auctions.<\/p>\n Last year's profit was higher than Lesy \u010cR's return to the level of profits from the years before the bark beetle disaster that broke out in Czech forests in 2018. The company had higher profits only in 2014 and 2015, when they amounted to 6.8 and 5.4 billion crowns (\u20ac264.62 million and \u20ac210.66 million). On the contrary, in 2019, the company suffered a loss of 790 million crowns (\u20ac30.68 million) due to the bark beetle disaster, and in 2020 it maintained a modest profit of 44 million crowns (\u20ac1.71 million) only thanks to the acceptance of state compensation for the reduction of wood prices due to the disaster in the amount\u00a0of 2.3 billion crowns.<\/p>\n The rise in timber prices last year was reflected in a 27 percent increase in the company's sales to a record 18.5 billion crowns (740 million euros) from 14.6 billion crowns (584 million euros) in 2021. The company's sales increased despite the fact that logging fell by 19 percent to 9.22 million cubic meters. The company had record production at the height of the calamity in 2020, when it reached 14.4 million cubic meters.<\/p>\n Bark beetle wood logging last year in state forests fell by 47 percent to 2.95 million cubic meters from 5.6 million cubic meters the year before. So far, the record extraction of bark wood was in 2019, namely 9.7 million cubic meters. In the years before the bark beetle calamity, total extraction at Les\u016f \u010cR was around eight million cubic meters.<\/p>\n The priority of the company remains the restoration of forests after the disaster. Last year, at a cost of 1.5 billion crowns (60 million euros), the company reforested about 20,000 hectares and planted 81 million seedlings. This was less than in 2021, when the company reforested a record 22,000 hectares and planted approximately 90 million saplings. \"With the decrease in mining, the area of clearings also decreases,\" the company said about the decrease in plantings earlier. The company succeeded in restoring approximately 5,000 hectares naturally from the seeds and fruits of standing trees.<\/p>\n Lesy \u010cR expects profit to drop by a quarter this year. This year, the state enterprise Lesy \u010cR expects a year-on-year decrease in gross profit by roughly a quarter to 4.9 billion crowns (196 million euros) from last year's 6.7 billion crowns (268 million euros), due to lower logging level and the expected decline in wood prices.<\/p>\n Logging in state forests is expected to drop seven percent year-on-year to 8.5 million cubic meters this year, to levels before the outbreak of the bark beetle calamity in 2018. \"Of that, two million cubic meters should be bark beetle timber. This really means a return to ordinary management,\" said the company's CEO Dalibor \u0160afa\u0159\u00edk. He added that, in connection with the restoration of the company after the bark beetle calamity, the costs of cultivation work are also increasing significantly.<\/p>\n According to Sz\u00f3r\u00e1d, based on past experience, it cannot be expected that high wood prices would be maintained for a longer period of time. \"We are already registering it on the market, between the first and second quarters of this year there is a significant price drop, and this will be reflected in the following periods as well,\" said Sz\u00f3r\u00e1d.<\/p>\n The reduction in logging and prices will have an impact on sales, which should fall by 15 percent this year to 15.8 billion crowns from last year's record 18.5 billion crowns.<\/p>","protected":false},"excerpt":{"rendered":" Last year, Czech the state enterprise Lesy \u010cesk\u00e9 republiky (L\u010cR) increased its net profit by 83 percent to 5.03 billion crowns (\u20ac195.18 million) from 2.74 billion crowns (\u20ac106.47 million) in 2021. This was the third highest profit in the company’s … Continue reading