Enviva provides update of expansion projects

Enviva Partners LP released second quarter financial results on July 28, announcing progress with capacity expansion projects and reporting a 70 percent increase in net revenue when compared to the same period of 2020.  

The company said production continues to ramp up at the recently constructed expansion projects at Enviva’s pellet plants in Northampton, North Carolina, and Southampton, Virginia. The facilities are expected to reach their respective nameplate production capacities of 750,000 and 760,000 metric tons per year by the end of 2021.

Expansion projects at the Hamlet, North Carolina; Sampson, North Carolina; and Cottondale, Florida, pellet plants are expected to be complete by the end of 2022. These projects, referred to as the multi-plant expansions, aim to de-bottleneck manufacturing processes, eliminate certain costs, and increase production capacity while reducing greenhouse gas (GHG) emissions, according to Enviva.

Enviva’s sponsor is also developing new pellet production capacity, including facilities in Epes, Alabama, and Bond, Mississippi. The Epes plant is permitted to produce more than 1 million metric tons per year, with the proposed Bond plant being designed to produce between 750,000 and more than 1 million metric tons per year of wood pellets.

“During the second quarter of 2021, Enviva delivered results in line with our expectations for the quarter and laid the foundation for a very strong back half of the year,” said John Keppler, chairman and CEO of Enviva. “With the benefit of the commissioning and ramp of our Northampton, Southampton, and Greenwood plant expansions, continued progress on our Multi-Plant Expansions, and the substantial contracted cash flow acquired with the drop-downs of the Lucedale plant and Pascagoula terminal, we were pleased to increase our guidance for 2021, announce guidance for 2022, and complete a sizeable equity raise. We believe Enviva is firmly on track to deliver a strong full-year 2021 and an even more robust 2022.”

Enviva reported net revenue of $285 million for the second quarter, up 70 percent when compared to the same period of 2020. The company primarily attributed the growth to increased product sales.

Gross margin fell to $27.3 million, down 1.3 percent, due to higher revenue being offset by higher costs of goods sold. Adjusted gross margin reached $56.1 million, up 33.4 precent. Adjusted gross margin per metric ton was down 17.2 percent.

Net income was $2.8 million, down from $8.5 million, while adjusted net income was up 12.7 percent.  Adjusted EBITDA for the second quarter was up 30.7 percent, primarily due to higher sales volumes.