Metsä Board Corporation’s operating result excluding non-recurring items was EUR 56.2 million in the first half of 2013

Metsä Board Corporation Interim Report 1 January – 30 June 2013, 1 August 2013 at 12:00 noon


Result for the first half of 2013

  • Sales were EUR 1,037.8 million (Q1–Q2/2012: 1,066.8).
  • The operating result excluding non-recurring items was EUR 56.2 million (25.9). The operating result including non-recurring items was EUR 63.7 million (158.4).
  • The result before taxes excluding non-recurring items was EUR 22.4 million (8.4). The result before taxes including non-recurring items was EUR 29.8 million (140.9).
  • Earnings per share excluding non-recurring items were EUR 0.06 (0.02) and including non-recurring items EUR 0.08 (0.38).


Result for the second quarter of 2013

  • Sales were EUR 502.8 million (Q1/2013: 535.0).
  • The operating result excluding non-recurring items was EUR 26.0 million (30.2). The operating result including non-recurring items was EUR 28.9 million (34.8).
  • The result before taxes excluding non-recurring items was EUR 18.5 million (3.9). The result before taxes including non-recurring items was EUR 21.3 million (8.5).
  • Earnings per share excluding non-recurring items were EUR 0.05 (0.01) and including non-recurring items EUR 0.06 (0.02).


Events in the second quarter of 2013

  • Delivery volumes of folding boxboard continued to increase slightly and market prices were stable.
  • Demand for white-top kraftliner continued to be very strong, and average prices increased a little as a result of the price increase implemented in the spring.
  • The delivery volumes of uncoated fine paper and coated papers weakened from the previous quarter, mainly due to seasonal reasons. The price of uncoated fine paper increased slightly, but the decline in the price of coated paper continued.
  • Pulp prices increased moderately.
  • The production of lightweight fully-bleached kraftliners began in Husum.


“Our profitability in the second quarter was at the previous quarter’s level. The positive development of our paperboard operations continued. Deliveries of folding boxboard continued to increase, and deliveries of kraftliners remained at a very good level. The white-top kraftliner price increase was carried out successfully.

In order to grow our kraftliner business, the production of lightweight fully-bleached kraftliners began at the Husum mill in Sweden in April. This year, we will move some of the uncoated grade volumes from the Kemi kraftliner mill, operating at full capacity, to Husum. We are also investigating how to further strengthen the competitiveness of our folding boxboard business in the future.

The situation in the paper market in Europe continues to be difficult, particularly in coated papers. The new kraftliner production at Husum will replace the mill's least profitable coated paper production volumes. This, together with the ongoing cost savings programme, is expected to improve the Husum mill's profitability.

The market situation of our main products is estimated to continue to be stable in the third quarter of 2013, although uncertainty in the general economy is continuing. Nevertheless, our result development in the third quarter will be affected negatively by the extensive maintenance shutdowns in accordance with the annual plan at the Husum and Kemi integrated mills.”

Mikko Helander, CEO

 

Adoption of the amended IAS19 standard

Metsä Board adopted the amended IAS 19 Employee Benefits standard retroactively on 1 January 2013. The most significant changes were the following: all actuarial profits and losses are recognised immediately, and the financial cost of retirement plans is determined on the basis of net funding.

The Group's equity decreased by approximately EUR 10.6 million due to the amendment on 31 December 2012. The 2012 operating result improved by EUR 1.4 million and financial expenses increased by EUR 3.2 million.

The impact on the balance sheet and the statement of comprehensive income is discussed in greater detail in the Notes (Note 1).

The amended key figures are presented in the Key Figures table (Key Figures, restate).

 

KEY FIGURES, restate 2013 2013 2012 2012 2013 2012 2012    
  Q2 Q1 Q2 Q1 Q1-Q2 Q1-Q2 Q1-Q4    
Sales, EUR million 502.8 535.0 522.2 544.6 1,037.8 1,066.8 2,107.6    
EBITDA, EUR million 52.7 61.4 189.9 25.7 114.1 215.6 321.4    
  excl. non-recurring items, EUR million 52.1 56.8 47.8 35.2 108.9 83.0 186.0    
EBITDA, % 10.5 11.5 36.4 4.7 11.0 20.2 15.3    
  excl. non-recurring items, % 10.4 10.6 9.2 6.5 10.5 7.8 8.8    
Operating result, EUR million 28.9 34.8 162.0 -3.6 63.7 158.4 221.1    
  excl. non-recurring items, EUR million 26.0 30.2 19.8 6.1 56.2 25.9 74.9    
EBIT, % 5.7 6.5 31.0 -0.7 6.1 14.8 10.5    
  excl. non-recurring items, % 5.2 5.6 3.8 1.1 5.4 2.4 3.6    
Result before taxes, EUR million 21.3 8.5 159.4 -18.5 29.8 140.9 173.9    
  excl. non-recurring items, EUR million 18.5 3.9 17.2 -8.8 22.4 8.4 27.7    
Result for the period, EUR million 17.6 8.0 140.6 -15.4 25.6 125.2 171.3    
  excl. non-recurring items, EUR million 15.3 3.4 14.0 -5.7 18.7 8.3 42.4    
Result per share, EUR 0.06 0.02 0.43 -0.05 0.08 0.38 0.52    
  excl. non-recurring items, EUR 0.05 0.01 0.04 -0.02 0.06 0.02 0.13    
Return on equity, % 8.5 3.8 72.8 -8.4 6.1 32.3 21.5    
  excl. non-recurring items, % 7.4 1.6 7.3 -3.1 4.5 2.1 5.3    
Return on capital employed, % 6.7 7.7 35.1 -0.2 7.1 17.5 12.4    
  excl. non-recurring items, % 6.1 6.8 5.1 1.9 6.3 3.6 4.8    
Equity ratio at end of period, % 32.4 33.3 31.1 27.9 32.4 31.1 33.2    
Gearing ratio at end of period, % 130 122 138 153 130 138 130    
Net gearing ratio at end of period, % 74 69 73 103 74 73 73    
Shareholders' equity per share at end of period, EUR 2.48 2.54 2.46 2.22 2.48 2.46 2.59    
Interest-bearing net liabilities, EUR million 605.9 577.6 595.4 758.5 605.9 595.4 625.2    
Gross investments, EUR million 21.5 9.2 17.5 9.7 30.7 27.2 66.1    
Deliveries, 1 000 tonnes                  
  Paperboard 311 311 289 295 622 584 1,188    
  Paper 158 186 165 185 344 350 681    
                   
Personnel at the end of period 3,401 3,239 3,597 3,818 3,401 3,597 3,279    
                   
Deliveries are not comparable due to restructuring.                  
EBITDA = Earnings before interest, taxes, depreciation and impairment charges

 

Near-term outlook
The delivery volumes of folding boxboard are estimated to be approximately at the previous quarter's level in the third quarter of 2013. Final decision on the possible folding boxboard price increase during the coming months has not yet been taken.

Demand for white-top kraftliner is expected to continue to be very strong, and delivery volumes are estimated to increase slightly in the third quarter of 2013, taking into account also the increasing sales volumes of fully-bleached kraftliner at Husum. The average price level of white-top kraftliner is estimated to be approximately at the previous quarter's level in the third quarter.

Delivery volumes of uncoated fine paper and coated paper are expected to be approximately at the previous quarter's level in the third quarter of 2013. No significant changes in the price of uncoated fine paper or coated paper are in sight. 

Delivery volumes of market pulp are estimated to be at the previous quarter's level. The average price of pulp is not estimated to change materially in the third quarter.

Production costs in the third quarter of 2013 are expected to be approximately at the same level as in the previous quarter.

Extensive maintenance shutdowns in accordance with the annual plan will be carried out at the Husum and Kemi integrated mills in the third quarter of 2013.  

Metsä Board’s operating result, excluding non-recurring items, is in the third quarter of 2013 expected to be weaker than in the second quarter of 2013 primarily due to the maintenance shutdowns at Husum and Kemi mills.

 

Disclosure procedure
Metsä Board Corporation follows the disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority and hereby publishes its Interim Report for January–June 2013 enclosed to this stock exchange release. Metsä Board's complete Interim Report is attached to this release in pdf-format and is also available on the company's web site at www.metsaboard.com .

 

METSÄ BOARD CORPORATION

Further information:

Matti Mörsky, CFO, tel. +358 (0)10 465 4913
Juha Laine, Vice President, Investor Relations and Communications, tel. +358 (0)10 465 4335

More information will be available starting from 1 p.m. on 1 August 2013. A conference call held in English for investors and analysts starts at 3 p.m. (EET). Conference call participants are requested to dial in and register a few minutes prior to the start of the conference call on the following numbers:

Europe: +44 (0)20 7162 0025

US: +1 334 323 6201

The conference ID is 933422.

 

 

Metsä Board is Europe’s leading producer of folding boxboard, the world’s leading manufacturer of coated white-top kraftliners, and a major paper supplier. It offers premium solutions for consumer and retail packaging, graphics and office end-uses. The company’s sales network serves brand owners, carton printers, corrugated packaging manufacturers, printers, merchants and office suppliers. Metsä Board is part of Metsä Group and its shares are listed in NASDAQ OMX Helsinki. In 2012, the company’s sales totalled approximately EUR 2.1 billion. The company has approximately 3,300 employees.

 

www.metsaboard.com

 

About Us

Metsä Boardwww.metsaboard.com Metsä Board is a leading European producer of premium fresh fibre paperboards including folding boxboards, food service boards and white kraftliners. Our lightweight paperboards are developed to provide better, safer and more sustainable solutions for consumer goods as well as retail-ready and food service applications. We work together with our customers on a global scale to innovate solutions for better consumer experiences with less environmental impact. The pure fresh fibres Metsä Board uses are a renewable resource, traceable to origin in sustainably managed northern forests. The global sales network of Metsä Board supports customers worldwide, including brand owners, retailers, converters and merchants. In 2016, the company’s sales totalled EUR 1.7 billion, and it has approximately 2,500 employees. Metsä Board, part of Metsä Group, is listed on the Nasdaq Helsinki.

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