Setra Interim Report January-September 2008
• Consolidated net sales for the January – September 2008 period amounted to SEK 3,886 million (4,680). The reduction compared to the same period the previous year is the result of both lower prices and volumes. Net sales for the third quarter amounted to SEK 1,124 million (1,355).
• Operating profit for the January – September 2008 period amounted to SEK -174 million (703), which is SEK 877 million less than the same period the previous year. The weaker result is mainly an effect of lower selling prices and sustained high raw material costs. The operating profit for the third quarter amounted to SEK -97 million (220).
• Profit after tax for the January – September 2008 period amounted to SEK -155 million (486).
Earnings per share amounted to SEK -4.98 (15.38).
• Cash flow from operating activities for the January – September 2008 period amounted to SEK 175 million (190). The cash flow for the third quarter amounted to SEK 237 million (240). The positive cash flow in 2008 is mainly related to reduced stock levels.
Kent Torwald, President and CEO, comments:
“Setra is reporting an operating loss of SEK 97 million for the third quarter. The decline in profit compared to the same period the previous year is an effect of both lower prices and volumes. A large portion of the operating loss is attributable to the units in northern Sweden. Despite the weak result, on the positive side stock levels have fallen and the accumulated cash flow is in line with the previous year. Setra’s stocks of finished products were at a lower level at the end of the quarter than the same period last year.
Setra has implemented extensive measures to cut production, and the new production level is now 20% lower on an annual basis than the previous year. The decision to scale down production which was taken at the beginning of the year was intended to be a short-term measure. Today we believe that the new production level will be sustained throughout this financial year, although additional measures cannot be excluded.
We believe that the construction market, especially under the pressure of the financial crisis, will decline further. The next few quarters will continue to be tough, with weak profits and margins throughout the industry. To gain a better balance between supply and demand in a situation where we are continuing to see a fall in wood product consumption, it is crucial that the large production cuts announced by the major European producers are actually implemented.”