It was a cool start to the year, certainly as far as the temperature is concerned.

During the first quarter our turnover increased by approximately 10%.

All was peaceful and quiet on the procurement front. We’ve just had the hurricane Gudrun, so there was no indication that timber prices would increase.

We could only increase the production of pallets.
However, one could say that it was quiet before the storm.

Suddenly the prices stirred, slowly at first, and then moved faster, only to stop at 60% - 90% level at the end of year. But that was not the end. We started getting problems with obtaining sawn timber.

Despite the confirmed orders, we did not get the expected quantity of sawn timber. During the holiday period our reserves of sawn timber were so low that we had to buy additional stock from the building supplies shops. We managed to ensure delivery of the contracted products; additionally we provided support for other plants, including those outside Sweden, experiencing similar problems.

There is a problem with raw materials throughout Europe.

Finally NOW we are enjoying record high stocks of the sawn timber.

Of course pallet prices are also rising.
There is still a shortage of used europallets, although we have increased their sales in Sweden as well as outside the country.

Nonetheless, their prices are increasing.
There is also a shortage of new europallets.
However, it is encouraging for the market that we have sufficient numbers of used disposable pallets, in sizes 1200 x 800 and 1200 x 1000.
Additionally, we can offer pallet-containers at a fantastic price of 20.00 crowns per item!
Export wood packaging reached a new record level i.e. 3,280 items as compared with 2,708 items in 2005.

Sales of cases were also at a record level of 1,230 against 1,026 in 2005.

Plywood cases sales achieved level higher than expected.

Packaging accessories sales went from strength to strength.

Market conditions are considered to be highly favourable.

Polish plant had a good start and we hope that we might be able to start servicing Swedish firms in Poland and the rest of Europe.
In December we installed a new assembly line for the pallets and a new machine for assembling special products.

Our capabilities are now increased!

Looking back, we can celebrate now that GLF has increased its turnover for the 14th consecutive year!

We wish to thank our clients, as well as all our staff members, for a very inspiring year that was full of many challenges, which afforded us an opportunity to resolve many issues together.

I look forward to 2007 with confidence.

Kent Persson