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i n v e s t o r s i n p a u l o w n i a

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In t roduc t ion

Our s tor y i s a l l about paulownia t imber product ion and the exc i t ing oppor tun i t ies avai lable to inves tors .

Pau lownia L td i s a European fores t r y inves tment management company spec ia l i s ing in paulownia t imber p lan ta t ions . Based in London wi th admin is t ra t ive and operat ional o f f ices in both UK and Spain, we prov ide managed paulownia t imber inves tments . P lan ta t ions under development inc lude our own €4M paulownia pro jec t in the region of A lbacete, Spain and fur ther major pro jec ts across Europe wi th in our inves tment communi t y.


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Paulownia L td was created to explo i t marke t demand for t imber. Wi th an exper t team of agr icu l tu ra l , energy, env i ronmenta l and fores t r y profess ionals , European leaders and p ioneers in paulownia t imber p lan ta t ions across Europe, we of fer an unr iva l led suppor t f ramework for our paulownia p lan ta t ion pro jec ts . Together , we are dr iv ing towards our main objec t ive o f supply ing demand for paulownia, a t imber var ie t y wi th un ique charac ter i s t ics .

T imber demand far exceeds supply in count r ies l i ke Spain wi th the def ic i t made up by impor t s . Wi th such favourable marke t condi t ions we are h igh ly focussed on generat ing increased paulownia t imber product ion and explo i t ing these exc i t ing marke t oppor tun i t ies . Together wi th our inves tors we seek to mutual ly benef i t f rom th i s new and fas t growing t imber supply chain .

So what do we of fer an inves tor? We of fer new or mature, profess ional ly man-aged paulownia p lan ta t ions . We fac i l i ta te t imber inves tment in a f lex ib le way. We source land and prov ide a comple te management ser v ice inc luding land prepara-t ion, i r r igat ion, p lan t ing and fu l l care o f the p lan ta t ion through to cropping and del iver y to t imber processors . The inves tor can se lec t a p lan to su i te the i r appet i te : the s ize o f the p lan ta t ion; number o f t rees ; dura t ion of inves tment and whether to buy or ren t the land.

01 In t roduc t ion

02 Why jo in us

03 Why paulownia?

04 The demand

05 Pro jec t locat ion

06 Pro jec t management

07 Forecas t & fees

09 The nex t s tep

10 Contac t us

Why jo

in us

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Someone’s sitting in the shade today because someone planted a tree a long time ago.

Warren Buf fe t ti n v e s t o r s i n p a u l o w n i a

We are inv i t ing inves tors to become involved wi th th i s fan tas t ic oppor tun i t y wi th assured re turns and bel ieve our products wi l l appeal to a wide range of c l ien ts f rom indiv idual inves tors to subs tan t ia l funds .

Key to our s t ra tegy i s our European Paulownia Net work™ of par tners and assoc ia tes in the paulownia marke t . Wi th c lear ev idence of success fu l paulownia product ion across many p lan ta t ions we demons t ra te a proven t rack record. We have inves ted our own funds in paulownia p lan ta t ions and together wi th our Net work compr ise the mos t re l iab le and larges t source of paulownia t imber p lan ta t ions in Europe.

Al though paulownia grows in many areas around the wor ld not a l l paulownia i s the same or su i table for ever y se t o f env i ronmenta l condi t ions . Our b io logica l and agrosc ience adv isors have success fu l ly produced and paten ted a t rademark pro tec ted var ie t y, 8 years in deve lopment , which by far ou tper forms any o ther paulownia var ie t y tha t

grows wi th in our European weather and c l imate condi t ions . Our paten ted paulownia c lone i s cu l t i va ted for exce l len t t imber qual i t y to enhance i t s va lue as a qual i t y t imber inves tment .

To fur ther improve va lue and guarantee provenance our paulownia i s un iquely to be cer t i f i ca ted wi th a Qual i t y T imber Cer t i f i ca te (QWF) regula ted by the European Union Min is t r y o f Agr icu l tu re .

We have a fas t growing, super ior qual i t y paulownia var ie t y tha t wi l l command premium pr ices in the marke tp lace and maximise a prof i tab le ex i t s t ra tegy.

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WHY PAULOWNIA

Paulownia i s , by far , the fas tes t growing hardwood on the p lanet . Our h igh per formance paten ted paulownia var ie t y together wi th care fu l ly se lec ted pro jec t locat ions and outs tanding profess ional techn ica l management can de l iver 1m3 of t imber wi th in 8 to 10 years . Th i s unr iva l led growth speed bu i lds t imber vo lume far in excess o f o ther t ree t ypes which can take 25 years or more to ach ieve the same volume.

Paulownia has a un ique se t o f charac ter i s t ics . I t i s ex t remely l igh t , s t rong, f lex ib le, a ver y good insu la tor , has h igh temperature res i s tance and i t s combus t ion temperature i s a lmos t double tha t o f many convent ional hard and sof t woods . I t ’s no t surpr i s ing tha t paulownia i s known as the a lumin ium of the t imber wor ld .

Paulownia t imber ’s demand across Europe, Af r ica and Middle Eas t ar i ses f rom many of these ou ts tanding charac ter i s t ics . Appl ica t ions such as bu i lding mater ia l s , windows, doors , b l inds, arch i t rave, fu rn i tu re, a i rc raf t f i t t ings, boats , mus ica l ins t ruments and spor t equ ipments are some of the mos t common and bes t per forming paulownia t imber uses .

I t ’s a l so an ideal subs t i tu te for MDF and f ibre g lass which are recognised as pol lu tan ts wi th long decompos i t ion t ime. A l l o f th i s , p lus the fac t tha t paulownia t imber can be de l ivered wi th in 10 years , makes i t an ideal var ie t y for processors and manufac turers to p lan product for.


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The dem

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In one year you have a pole, in two years you have an umbrella and in five years you have sawn lumber

10th Centur yi n v e s t o r s i n p a u l o w n i a

Dur ing the pas t few years the paulownia in i t ia t ive has been bu i lding, s tudy ing, tes t ing and exper iment ing wi th innovat ive new products th rough the good work o f members o f the European Paulownia Net work™ inc luding research ins t i tu t ions , un ivers i t ies and some of the larges t t imber merchants wi th in the European t imber marke tp lace.

Al l agree tha t paulownia t imber has great advantages not jus t to supply common t imber products bu t to ou tper form and innovate due to qu ick growth, s t rength, l igh t weigh t and h igh temperature res i s tance.

One of these exc i t ing new products i s ep i tomised by the wor ld renowned sk i brand, Ross ignol ’s Soul7 sk ies , incorporat ing a l igh t weight paulownia core which reduced weight by 20% for eas ier tour ing, enhanced agi l i t y and u l t ra- l igh t swing weight . I t was ISPO awarded as 2013 bes t and mos t innovat ive new product be ing in t roduced around the wor ld . There i s s t rong demand f rom the sk i ing, water spor t s and mar ine indus t r ies for paulowna t imber.

Other examples inc lude bu i lding br icks made of 60% paulownia powder resu l t ing in reduced br ick weight and a s ign i f ican t reduc t ion in t ranspor t cos t s . Amazing new appl ica t ions are be ing developed us ing bacter ic idal nanopar t ic le cover ings to make paulownia based, l igh t weight , bac ter ia res i s tan t fu rn i tu re for the k i tchen indus t r y and bacter ia prevalen t areas such as hospi ta l s and nurser ies .

These are jus t a few reasons why i t i s our miss ion to supply and develop the lucra t ive and in teres t ing poten t ia l o f paulownia t imber.

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p05 i n v e s t o r s i n p a u l o w n i a

We have chosen Spain as the key count r y for our paulownia p lan ta t ion development s t ra tegy to take advantage of i t s favourable t imber marke t condi t ions bu t a l so because i t so wel l located to meet demands f rom i t s Nor th Af r ican ne ighbours .

Spain cur ren t ly consumes double the amount o f i t s indigenous t imber product ion . I t produces 15M m3 per year which represents 1% of g lobal product ion in sp i te o f hav ing ex tens ive fores ta t ion, much of which i s pro tec ted or under-developed for t imber product ion .

S ince 2012, a Spanish nat ional ac t ion p lan to reduce t imber impor ta t ion by 33% by 2030 has been pu t in to ac t ion . The objec t ive i s to increase t imber product ion to 50M m3 by 2050 and reduce impor ta t ion to less than 20% of the nat ional demand.

Not on ly Spain has large t imber product ion def ic i t s , ne ighbour ing count r ies such as those in Nor th Af r ica and fur ther away in the Middle

Eas t impor t near ly 100% of the i r t imber. Wi th major por t s , such as Valenc ia and Algec i ras , we have economical ly v iable t ranspor t rou tes in to these marke ts .

For Paulownia L td, the oppor tun i t y to supply local and ne ighbour ing demand i s a mass ive a t t rac t ion and, consequent ly, a major imperat ive to expans ion of our product ion capaci t y.

Th i s favourable marke t s i tua t ion a long wi th the except ional year round c l imate condi t ions , ideal p lan ta t ion locat ions and f i rs t c lass ra i l , road and sea t ranspor t fac i l i t ies are the reasons we se lec ted Spain to be our bus iness hub.

Project M

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Give me six hours to chop down a tree and I will spend the first four sharpening the axe

Abraham L incolni n v e s t o r s i n p a u l o w n i a

Al l o f our t imber p lan ta t ions are carefu l ly managed, cont ro l led and super v i sed by an exper t techn ica l team of agro sc ien t i s t adv isors , b io logis t s and fores t r y profess ionals wi th many years o f exper ience.

In addi t ion to success fu l ly es tabl i sh ing more than 500 hec tares o f paulownia p lan ta t ion in Spain, Romania, I ta ly and South Amer ica, they have managed and been di rec t ly respons ib le for thousands o f hec tares o f v ineyards, a lmonds, o l ives and many o ther agr icu l tu ra l pro jec ts over the las t 30 years .

For an annual fee, we manage the en t i re product ion cyc le f rom supply ing the paulownias to the fu ture sa le o f the t imber, inc luding land preparat ion, ins ta l l ing i r r igat ion sys tems, p lan t ing, fer t i l i s ing, water ing, prun ing, cu t t ing and del iver ing the t imber to the marke t . Look ing af ter a paulownia p lan ta t ion requi res regular and cont inuous a t ten t ion to maximise per formance.

We work c lose ly wi th local town hal l s who are keen on what they v iew as impor tan t local cont r ibu t ions to the i r economy, employment and land usage. We employ and t ra in local labour and a lso subcont rac t to profess ional ser v ice prov iders to prov ide main tenance and ins ta l la t ion ser v ices under our ins t ruc t ion and super v i s ion .

A t any t ime, inves tors are welcome to v i s i t the i r p lan ta t ion to be gu ided through the progress and updated wi th la tes t ach ievements . P lan ta t ion progress repor t s are prov ided on a quar ter ly bas i s and we encourage a f r iendly regular dia logue to main ta in a cont inu ing pro jec t invo lvement .

PlantationKey Financial Elements

Standard Calculation

Area 1 Hectare

Nº trees 600 600 trees /Ha

Initial Reservation Fee* € 4,000 € 4,000/Ha

Initial Investment** € 12,000 €12,000/Ha

Total 1st year Investment € 16,000

Annual Fees*** € 36,000 € 4,000/Ha /Year

Total Investment € 52,000 10 years (1st year + 9)

Cropping Cost**** € 36,000 € 60 / tree

Sale of Timber € 168,000 1 tree= 0.7m3 @ €400/ m3

INVESTMENT RETURN € 132,000

Foreca

st & Fees

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Inves tmen t

One hec tare o f paulownia p lan ta t ion i s p lan ted wi th 600 paulownia t rees .

A paulownia t ree produces about 1m3 of t ree and 0.7m3 of usable t imber wi th in 8-10 years which to ta l s 420m3 of usable t imber per hec tare

The cur ren t marke t va lue for paulownia in count r ies l i ke Aus t ra l ia and China for f i rs t qual i t y t imber has exceeded $1,500 per m3. In Europe, impor ted paulownia t imber i s be ing bought for over €500 per m3. These va lues should ensure tha t our qual i t y s tamped, t rademarked, paulownia t imber es t imate o f €400 per m3 i s a reasonable and safe forecas t .


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P lan ta t ion example paulownia

Internal ra te o f re turn over 10 years - 16.4%

In ternal ra te o f re turn in f la ted @ 7% af ter 10 years - 24.7%

*In i t ia l Reser vat ion Fee: Pau lownia L td wi l l organise paulownia p lan ts , local labour and land preparat ion .

**In i t ia l inves tment : Th i s covers land preparat ion, p lan t ing process and f i rs t year p lan ta t ion management .

***Annual Fees : €4,000 per year per hec tare are paid towards p lan ta t ion man-agement : labour, fer t i l i sers , water , herb ic ides, insec t ic ides and techn ica l di rec t ion e tc .

**** Cropping Cos t : The t ree i s now ready to be har ves ted. Th i s cos t wi l l be de -duc ted f rom the sa le o f the t ree .

Wi th t imber sa les pr ices be ing €400

P lan ta t ion example paulowniaFo

recast &

Fees

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Money doesn’t grow on trees. Unless, that is, you are in the timber business. . .

F inanc ia l T imesi n v e s t o r s i n p a u l o w n i a

We, a t Pau lownia L td, be l ieve i t i s reasonable to cons ider a conser vat ive 5% growth per annum f rom today’s marke t va lue for paulownia t imber wi th in the nex t 10 years . Our Inves tment P lans show the In ternal Rate o f Re turn i f t imber pr ices remained f la t a t today’s va lues and what would happen i f a l l va lues increased a t 7% per annum. Inves tors should make the i r own judgements .

*Per formance Fee: A per formance fee of 20% wi l l apply to the ne t prof i t on sa les greater than the es t imated sa les pr ice agreed a t the t ime of cont rac t .

Cash fl ow for 10 yr growth cycle - rental (10 hectare plantation)

Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Outcome

Investment 160,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000

Revenue 0 0 0 0 0 0 0 0 0 0 1,320,000

Cashfl ow -160,000 -200,000 -240,000 -280,000 -320,000 -360,000 -400,000 -440,000 -480,000 -520,000

Next step

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The nex t s tep

BOOK A VISIT TO OUR PAULOWNIA PLANTATIONS.

Don’ t take i t for granted, come and v iew i t for yourse l f !

We encourage t imber inves tors to come and v iew the en t i re paulownia operat ion for themselves . We can organise group tours as wel l as independent v i s i t s to our p lan ta t ions and suppor t in f ras t ruc ture .

A t yp ica l tour cons i s t s o f 2-3 days and inc ludes co l lec t ion a t Valenc ia Ai rpor t and compl imentar y t rans fer to your hote l fo l lowed by:

V is i t to the laborator ySee the b i r th o f a paulownia t ree! You wi l l be shown around the larges t in v i t ro cu l t i va t ion laborator y in Spain and second larges t in Europe, expla in ing the micro-propagat ion process , v iewing how paulownia c lones are mul t ip l ied, unders tanding the s tep by s tep process o f each c lone pr ior to p lan t ing. A fan tas t ic learn ing exper ience!

P lan ta t ion ToursAf ter learn ing how our paulownia c lones are carefu l ly c reated and mul t ip l ied, we wi l l take you through a number o f p lan ta t ions wi th di f fe ren t age ranges to he lp you unders tand paulownia’s growing cyc le . We wi l l a l so show you avai lable p lan ta t ions and ta i lor made inves tment oppor tun i t ies tha t would match your t imber inves tment requi rements .

Unders tanding the en t i re Bus iness Cyc leDur ing your v i s i t we wi l l take you to the saw mi l l s tha t process paulownia t imber, l i s ten to the i r exper ience wi th the qual i t y o f our paulownia t imber and prov ide an ins igh t in to the wide var ie t y o f appl ica t ions and products for which paulownia i s su i tab le . We wi l l show you some examples o f these products .Th i s wi l l br ing to l i fe the en t i re cyc le o f the paulownia inves tment bus iness .

De ta i led inves tment explanat ion and legal purchase procedureWe wi l l a l locate some t ime dur ing your v i s i t to expla in the benef i t s o f t imber inves tment , work ou t some numbers for you and in t roduce you to legal exper t i se to expla in the inves tment process . Th i s wi l l a l so a l low you to dec ide whether i t i s be t ter for you se t up a Spanish company or inves t as an indiv idual to maximise your inves tment poten t ia l .


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Co

ntact us

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Timber has risen steadily in price for 200 years and has returned an average of 6,5% a year for the last century

Jeremy Granthami n v e s t o r s i n p a u l o w n i a

Jo in us on th i s exc i t ing ven ture and see for yourse l f the t imber inves tment oppor tun i t ies avai lable . Learn about paulownia and i t s un ique t imber qual i t ies by v i s i t ing us dur ing a long weekend. I t wi l l be a fu l l weekend’s learn ing exper ience bu t led in a f r iendly and re laxed way wi thout pressure . You wi l l no t regre t i t !

+44 (0)203 2827178

[email protected]

Paulownia L tdOmnibus Bus iness Cent re42 Nor th RoadLondonN7 9DP