Pinnacle’s quarterly result impaired by lower margins

29.11.2018 − 

Although Canadian Pinnacle Renewable Energy Group recorded an increase of 6.4 % in sales revenue for the third quarter to 87.6m CAD, adjusted EBITDA fell by almost 14 % to 14.5m CAD compared to the corresponding period in the preceding year. Lower miscellaneous costs and a reduction in financing costs, on the other hand, played a part in considerably raising net profit for the period under review to +1.5m CAD.

The adjusted gross margin in the third quarter was 17.9m CAD or 20.5 % of the sales revenue as opposed to 19.4m CAD or 23.5 % a year earlier. According to Pinnacle, the lower gross margin was mainly attributable to higher capital costs in connection with the start-up of the 400,000-t pellet works in Entwistle, Alberta. Higher repair and maintenance expenditure due to problems with raw-material quality and a lower level of production arising from delays in building the storage silo in Entwistle led to cost increases to the tune of 3.7m CAD. Business activity was further impaired by the forest fires in British Columbia and delays in transport by rail.

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