Highly robust first quarter

Södra reported highly robust operating profit of SEK 938 million (490) for the first quarter of 2018, up more than 90 percent compared with the year-earlier period. Strong demand with a positive price trend underlie these figures, and the higher volumes generated by the expansion investments are reflected in the results.

Consolidated net sales rose 12 percent to SEK 5,717 million compared with the year-earlier period, and the operating margin improved to 16 percent (10). Return on capital employed increased to 22 percent (12) and the equity ratio to 58 percent (56).

“There are several reasons for this robust earnings trend. The favourable global economy has contributed to high demand and a positive price trend for Södra’s products in both market pulp and the sawn timber area. We are also seeing the positive effects of our comprehensive expansion investments in the pulp mills, and the efficiencies and restructuring we have achieved in sawn timber production,” said Lars Idermark, President and CEO.

“Our efforts with new innovations and sustainability have continued unabated. Södra’s investments to increase liquid biofuel production are on track, as well as investments in sawn timber processing. These strategic investments in the future are helping to create new business opportunities. They also represent steps towards a fossil-free society, and a sustainable bioeconomy in which forests can play a key role,” said Lars Idermark.

In the Södra Skog business area, operating profit totalled SEK 19 million (16) for the period. The results were charged with higher transport costs due to the intermittently challenging wood supply situation during the first quarter.

In the Södra Wood business area, operating profit totalled SEK 91 million (3) for the period, mainly reflecting the positive price level and strong demand for sawn timber. The ongoing operational changes in Södra Interiör are proceeding as planned.

In the Södra Cell business area, operating profit totalled SEK 926 million (496) for the period. The earnings trend was mainly attributable to the strong upward price trend and higher volumes.

Watch the video interview with Lars Idermark
 

January-March 2018 in brief: 2018 2017
  Jan-Mar Jan-Mar
Net sales, SEK million 5,717 5,098
Operating profit before depreciation, amortisation and impairment, SEK million 1,216 750
Operating profit, SEK million 938 490
Profit before tax, SEK million 941 430
Operating margin, % 16 10

 

For questions, please contact:
Lars Idermark, President and CEO, Södra
Tel: +46 (0)470 894 36

Anna Belfrage, CFO Södra
Tel: +46 (0)470-890 40

Södra’s Pressroom,
Tel: +46 (0)470-890 90
E-mail: press@sodra.com

Södra was founded in 1938 and is the largest forest-owner association in Sweden, with a membership of more than 51,000 forest owners. We engage in modern and responsible forestry, and operate state-of-the-art mills in which we process our raw material. Net sales in 2017 were 20.5 SEK billion and there were 3,400 employees. Through value-generating relationships and a long-term approach, Södra is leading the way for the future of sustainable forestry.

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Södra was founded in 1938 and is the largest forest-owner association in Sweden, with a membership of more than 51,000 forest owners. Södra is also an international forest industry Group, with 3,400 employees around the world. Net sales in 2017 were 20.5 SEK billion. Balancing production efficiency with nature conservation guides everything that we do. We produce timber, interior wood products, pulp for paper and textiles, and green energy. We use every part of the tree, and are always looking to develop new products from this fantastic, renewable raw material. Södra is a world-leading producer of market pulp and also owns one of the largest sawmill operations in Europe. Through value-generating relationships and a long-term approach, Södra is leading the way for the future of sustainable forestry.

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There are several reasons for this robust earnings trend. The favourable global economy has contributed to high demand and a positive price trend for Södra’s products in both market pulp and the sawn timber area. We are also seeing the positive effects of our comprehensive expansion investments in the pulp mills, and the efficiencies and restructuring we have achieved in sawn timber production.
Lars Idermark, President and CEO.