30 million in profit for Moelven
Increased delivery volumes in the Group’s woodworking business and a positive trend in the Swedish part of the module and interior business gave Moelven an operating profit of NOK 30 million in the first quarter of this year.
This meant that Moelven increased operating profit by NOK 8 million over the same period last year. Revenues in the first quarter increased by 13 percent to NOK 2605 million (2316 million).
CEO Morten Kristiansen of Moelven Industries ASA says that there has been a satisfactory demand for sawn timber in the quarter.
“In the export markets, the currency situation helped to maintain margins. Demand from the construction sector in Scandinavia has been good. Delivery volumes were higher, but at lower prices, compared to the same period last year,” says Kristiansen.
Good supply of raw material
Raw material supply for the wood and timber divisions was satisfactory during the period. Prices for sawn timber were somewhat lower than in the same period last year.
“In the building systems division, the activity level was higher than in the same period last year. The main reason was an excellent order intake in the module business in Sweden throughout 2015. The Norwegian module business has also managed to improve its productivity. There are also favourable market conditions for the Moelven Modus interior business in Sweden.
In Norway, however, we see a decline in demand in our interior business. This is particularly in the southwest, where the downturn in the oil economy has affected demand in the Norwegian market,” says Kristiansen.
Intensive improvement work
Kristiansen says there are still units with rather poor results that have a negative effect on the Group’s profit.
“In the action plan we have drawn up to achieve the Group’s profitability targets, substantial resources have been allocated to improvement in these units. This work will continue with high intensity throughout 2016. Otherwise, we are keeping to our strategic plan in our improvement work,” says Kristiansen.
A positive development in the international market for sawn wood is expected. The currency situation is still helping us to maintain competitiveness in our export markets.
“In Norway, the demand for processed wood products is expected to be at a similar level to last year, but with regional differences. Building activity in and around the main cities and towns is expected to remain high, with the exception of the southwest. In Sweden, demand for new homes remains strong and activity in the new build market is high. The RME market is also seeing a good level of activity,” says Kristiansen.
Demands for short construction time
For glulam, the positive trend of choosing wood for load-bearing structures is expected to continue.
“We are also pleased to note strong demand in Norway and Sweden for modular buildings for residential purposes. Demands for short construction time are growing. This applies to homes, schools, retirement homes and especially refugee centres. The market for interior systems is seeing a very high activity level in Sweden, primarily in Stockholm, Gothenburg and Malmø. But the Norwegian market is declining, and capacity adjustments will be needed,” says Kristiansen.
All in all, the result for 2016 is expected to be somewhat better than in 2015.
For further information, please contact:
Group Managing Director Morten Kristiansen - Mobile No. +47 91118250
Director of Communications and HR Kristin Bjørnstad - Mobile No. +47 90713701
Communications Manager Tom E. Holmlund - Mobile No. +47 91668668