Interim Report January-June 2002

KLIPPAN AB - Interim report January - June 2002 * Profit after net financial items MSEK 34.2 (11.5) * The integration of KLIPPAN Mölndal is progressing according to plan * New issue carried out General KLIPPAN AB bought Stora Enso Mölndal AB as at 2 April 2002, whereupon this company changes its name to KLIPPAN Mölndal AB. The acquisition has meant that certain historical comparison figures are not relevant. The acquisition has partly been financed through a new issue, which was completed during the month of July. The effects of this are therefore not shown in the report. Sales Orders received by European fine paper mills during the first half of the year continued to be unsatisfactory. Compared to the very weak period last year, orders received increased by only 2% for coated paper, while uncoated paper showed an increase of 7%. The general price level in Europe has been under pressure, in particular for coated qualities, during the first six months of the year. For KLIPPAN's part, the level of orders received has been satisfactory and all the paper machines have been working according to plan. The integration of KLIPPAN Mölndal has been fortunate from a marketing point- of-view, and KLIPPAN has strengthened its positions significantly. [REMOVED GRAPHICS]The price level for most product groups have been maintained or strengthened during the period and there are hopes that price increases can be carried out during the autumn in certain markets. Order books are currently at 3-5 weeks, depending on the paper machine, which is fairly optimal. Production The year's production of paper amounted to 68,950 tons (48,050). KLIPPAN Mölndal's proportion of the manufacturing was 16,050 tons. Pulp manufacture increased by just over 400 tons to 15,700 tons. As part of the restructuring of the production units, Klippan Mill has reintroduced a fifth shift for PM7 and PM10 as from August 2002. Result Operating profit for the group amounted to MSEK 43.8 (18.9) and profit after financial items amounted to MSEK 34.2 (11.5). The return on capital employed for the latest 12 month period was 13.8% (12.1 for the entirety of 2001). The improved result was in the main due to reduced costs, which has improved margins. The exchange rate development during the second quarter has been favourable to KLIPPAN. The Swedish krona weakened against the euro, while strengthening against the US dollar. At the end of the second quarter, the number of employees at work was 887 (509). Investments Investments in the parent company during the period was MSEK 76.4 (4.8). the majority of which related to the acquisition of KLIPPAN Mölndal AB. To this are added investments into KLIPPAN Mölndal of MSEK 8.1. Large investment projects in addition to the company acquisition were the A4 line in Mölndal, a new pulp tower in Lessebo and the acquisition of further shares in Inveresk PLC. Changes to equity Opening equity 2002-01-01 208.0 Dividend paid to -6.2 shareholders Translation differences -0.2 Result for the six 25.1 month period Closing equity 2002-06-30 226.7 Liquidity and financing Group liquid assets, including the unused proportion of the bank overdraft facility, amounted to MSEK 135.8 (62.9) at the end of the six months. The interest-bearing net liability has increased by MSEK 200.6 since the year-end to MSEK 339.6. Solidity amounted to 24.5% (34.4) and the debt/equity ratio to 1.5 (1.0). Cash flow analysis New share issue for KLIPPAN completed During July, the new issue for KLIPPAN AB was completed. It was fully subscribed and raised MSEK 41.3 for the company. Of these, MSEK 39 have been used to amortize loans. After the new issue, the number of shares in KLIPPAN AB amounts to 8,266,666, each of a nominal SEK 5. Purchase of shares in Inveresk PLC During the second quarter, KLIPPAN has increased its shareholding in the paper producing company Inveresk PLC. A further 500,000 shares have been purchased, which means that KLIPPAN now owns around 8.5% of the company. Together with associated interests, KLIPPAN now controls just over 24% of Inveresk. Next report KLIPPAN's interim report will be presented on 24 October 2002. Klippan, 29 August 2002 Bengt Östensson President/CEO Audit report We have reviewed the periodic report for the period 1 January - 30 June 2002 and thereby followed the recommendations issued by the Swedish Institute of Authorized Public Accountants (FAR). A review is considerably limited in comparison with an audit. Nothing as emerged to indicate that the periodic report does not fulfil the requirements of the Annual Accounts Act. Gert Frej Berith Ehrenpohl Authorized Public Accountant Authorized Public Accountant For further information, please contact the President Bengt Östensson, tel +46(0)70 595 86 27 or Vice-President Finance Kenneth Nellros, tel +46(0)70 542 93 25. SUMMARY INCOME STATEMENT AND BALANCE SHEET [REMOVED GRAPHICS] * Reported annually ** Share price as at 02-06-30 SEK 39.00, as at 01-12-31 SEK 21.00, as at 01-06-30 SEK 18.50 ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/09/03/20020903BIT00270/wkr0001.doc The full report http://www.waymaker.net/bitonline/2002/09/03/20020903BIT00270/wkr0002.pdf The full report