Strong result and positive market conditions for Södra

Södra’s operating profit totalled SEK 421 million (400) for the third quarter. The strong results were due, inter alia, to higher prices and stable demand for both paper pulp and sawn timber. During the quarter, decisions were also taken about future-oriented initiatives for increased wood processing and biofuel production.

“Market conditions for forest industry products remained favourable, and higher prices for both market pulp and sawn timber contributed to a strong result. Production levels remained stable at all of Södra’s facilities during the quarter, while Södra is in its most extensive investment phase for decades,” said Lars Idermark, President and CEO.

“We also made decisions about important future initiatives during the period. These relate partly to increased wood processing in cross-laminated timber, and partly to the production of biofuel based on the by-product methanol from the pulp industry,” said Lars Idermark, President and CEO.

Net sales in the third quarter increased 8 percent to SEK 4,763 million (4,417). Operating profit increased 5 percent to SEK 421 million (400). Operating margin was 9 percent (9).

The Södra Skog business area reported operating profit of SEK 12 million (11) and a sales increase of 8 percent in the third quarter.

The Södra Wood business area reported operating profit of SEK 8 million (0). The increased result was mainly due to a positive price development and high demand for sawn timber. Sales decreased 8 percent due to restructuring and a deliberate product portfolio reduction.

The Södra Cell business area reported operating profit of SEK 421 million (377). The improved result was mainly due to strong demand. The new pulp mill in Värö is now fully operational and capacity has increased according to plan. The result was also positively impacted by the continuing high price level for softwood sulphate pulp.

For the January to September period, net sales amounted to SEK 15,105 million (13,915), operating profit to SEK 1,336 million (699) and operating margin to 9 percent (5). Return on capital employed was 11 percent (6) and equity ratio was 55 percent (53).

 

Quarterly report July-September 2017 in brief 2017 2016 2017 2016 2016
  Jul-Sep Jul-Sep Jan-Sep Jan-Sep Jan-Dec
Net sales 4,763 4,417 15,105 13,915 18,482
Operating profit before interest, taxes, depreciation and amortisation (EBITDA), SEK million 726 658 2,263  1,519 2,101 
Operating profit (EBIT), SEK million 421 400 1,336 699 1,005
Profit before income tax, SEK million 402 378 1,276 648 939
Operating margin, % 9 9 9 5 5

 

Watch the video interview with Lars Idermark

 

For more information, please contact:
Södra's Pressroom,
Tel: +46 (0)470-890 90
Email: press@sodra.com

Södra was founded in 1938 and is the largest forest-owner association in Sweden, with a membership of more than 50,000 forest owners. We engage in modern and responsible forestry, and operate state-of-the-art mills in which we process our raw material. Through value-generating relationships and a long-term approach, Södra is leading the way for the next generation of 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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