M-REAL?S Q3 RESULT IMPROVED SLIGHTLY, PR
M-real Corporation Stock Exchange Bulletin 27.10.2003 at 13.00 1 (17)
M-REALS Q3 RESULT IMPROVED SLIGHTLY, PROFITABILITY IS STILL
UNSATISFACTORY
In the third quarter M-real Groups operating profit rose to EUR 28.9
million from EUR 14.8 million in Q2. The profitability of Consumer
packaging, Publishing and Metsä Tissue improved, whereas the result
reported by Home & Office, Commercial printing and Map Merchants
declined. In the current market situation the result was
unsatisfactory. However, cost-savings programmes are moving ahead in
line with plans.
Key figures in the third quarter:
- Earnings per share: EUR -0.10 negative (previous quarter: EUR -0.01
negative)
- Result before extraordinary items: a loss of EUR 3.9 million (loss
of 9.7)
- Operating profit: EUR 28.9 million (14.8)
- Cash flow from operations: EUR 107.7 million (31.2)
- Return on capital employed: 2.3 per cent (1.4)
- Turnover: EUR 1,467.2 million (1,507.8)
- Equity ratio at the end of the period: 33.1 per cent (32.9)
- 80 per cent capacity utilization rate at the paper mills (85), 87
per cent at the board mills (78)
The improvement in the Consumer packaging business areas
profitability was achieved mainly by lower costs. The earnings
improvement for magazine paper was driven by the rise in the delivery
volume and improved production efficiency at the mills. Metsä
Tissues profitability was boosted by lower raw material costs and an
improved product mix.
President and CEO Jouko M. Jaakkola commented on the market situation
and the year end as follows:
The key economic indicators are still not showing any clear
direction for the future. Nevertheless, there are signs of a pick-up
in the economy in the United States. In Europe, we are seeing a
seasonal upswing in the demand for coated papers in September-
November. Our previously announced EUR 295 million savings programmes
are moving ahead in line with plans and will for the most part reach
completion by the end of the year. Weak demand will dampen their
effect to some extent. The actions has been started to develop sales
and marketing and productivity of certain production units. Earnings
in the latter part of the year will also be affected by shutdowns, in
line with collective labour agreements, at the mills in Finland in
December. The last quarter is likely to be in the red.ö
M-REAL CORPORATION
Corporate communications
For further information, contact:
Jouko M. Jaakkola, President and CEO, M-real Corporation, tel. +358
10 469 4118, GSM +358 50 2261
Heikki Saarinen, Senior Vice President & CFO, M-real Corporation,
tel. +358 10 469 4686, GSM +358 50 598 7142
M-REAL CORPORATION
INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2003
JULY-SEPTEMBER EARNINGS COMPARED WITH THE PREVIOUS QUARTER
In the third quarter M-real Groups operating profit rose to EUR 28.9
million from EUR 14.8 million in the previous quarter. Operating
profit amounted to 2.0 per cent of turnover (Apr.June 2003: 1.0).
The profitability of Consumer packaging, Publishing and Metsä Tissue
improved, whereas the result reported by Home & Office, Commercial
printing and Map Merchants worsened.
The improvement in the Consumer packaging business areas
profitability was achieved mainly by lower costs. The average
selling price in euros fell slightly. Paperboard deliveries totalled
265,000 tonnes (265,000). Production curtailments amounted to 43,000
tonnes (59,000). The capacity utilization rate was 87 per cent (78).
The total volume of paper delivered was down on the previous quarter.
The weakening in the profitability of fine paper was due primarily to
the fall in the delivery volume and selling price. The earnings
improvement for magazine paper was driven by the rise in the delivery
volume and improved production efficiency at the mills. The average
selling price of paper in euros declined somewhat. The delivery
volume of coated fine paper fell by one per cent and that of uncoated
fine paper by 10 per cent. However, the delivery volume of magazine
paper rose by three per cent. The total volume of paper deliveries
was 905,000 tonnes (927,000). A high level of production curtailments
had to be continued, amounting to 195,000 tonnes (126,000). The
capacity utilization rate of the paper mills was 80 per cent (85).
The effect of the change in foreign exchange rates taking into
account hedging income on operating profit was EUR 8.4 million
negative (a gain of 6.2 million). By the end of September the US
dollar had weakened by 2.0 per cent and the British pound sterling by
0.4 per cent compared with the end of June. The average exchange rate
of the dollar against the euro over the June-September period was
nevertheless 1.0 per cent stronger and pound against the euro 0.4 per
cent stronger than in the previous quarter.
Turnover was EUR 1,467.2 million (1,507.8).
The share of the profit of associated companies includes M-reals
proportion of the capital gain on the sale of Logisware Oys business
operations, EUR 7 million.
Other operating income amounted to EUR 14.7 million (23.2). The sum
does not include major non-recurring items.
Net financial expenses were EUR 32.8 million (24.5). Financial
expenses include a foreign exchange loss on financial items of EUR
0.5 million (a gain of 5.3). Net interest and other financial
expenses amounted to EUR 32.3 million (29.8).
The result before extraordinary items was a loss of EUR 3.9 million
(compared with a loss of 9.7 million in the previous quarter).
The result for the third quarter after taxes and minority interests
was a net loss of EUR 18.0 million (a net loss of 2.0 in Q2). Taxes,
including the change in the imputed deferred tax liability, were EUR
14.0 million negative (tax expenses of 8.3 million).
Earnings per share were EUR -0.10 negative (-0.01 negative).
The return on capital employed was 2.3 per cent (1.4). The return on
equity was 3.0 per cent negative (0.2 per cent negative).
EARNINGS IN JANUARY-SEPTEMBER COMPARED WITH THE SAME PERIOD OF 2002
Operating profit in January-September was EUR 111.1 million (Jan.-
Sep. 2002: 273.6 million). The profitability of all business areas
weakened except for the Map Merchants business. The main factors that
weakened profitability were the lower selling prices of paper as well
as the average drop of 20 per cent in the exchange rate of the US
dollar and the 10 per cent fall in the British pound as well as the
increased proportion of deliveries to markets outside Europe. The
cheaper dollar hit the profitability of the Consumer packaging
business area particularly hard. Operating profit was also reduced by
the disposal of the shareholding in Albbruck in June 2002. *(On the
previous page it states a 2.0 per cent fall in the exchange rate for
the US dollar and a 0.4 per cent fall for the pound sterling.)
Turnover was EUR 4,569.9 million (4,976.9). Turnover was lowered by
the same factors as impacted operating profit. In comparable terms,
the fall in turnover was 7.8 per cent.
Consolidated profit before extraordinary items was EUR 25.0 million
(124.2).
PERSONNEL
The number of personnel at the end of September was 19,988 employees
(20,421 employees at 30 September 2002), of which 5,955 employees
worked in Finland (6,157). The net increase in personnel as a
consequence of acquisitions and divestments was 360 employees. The
payroll at the end of 2002 was 20,323 employees.
The Groups personnel includes 47 per cent of Metsä-Botnias
employees.
CAPITAL EXPENDITURES ON FIXED ASSETS
M-reals total capital expenditures in January-September amounted to
EUR 136 million. In addition, M-real paid a total of EUR 154 million
for shares in Metsä Tissue and other acquired companies.
On 17 September, M-reals Board of Directors decided to build a new
chemithermal mechanical (BCTMP) pulp mill in Kaskinen. The planned
production capacity is 300,000 tonnes a year, all of which will be
used as the raw material for the Groups own paper mills. The new
facility will contribute to improving the quality of paper grades and
lowering costs. The pulp mill will be completed in the autumn of 2005
and provide employment for about 65 people. The total price of the
investment is about EUR 180 million and the financing requirement for
it will be spread over 2004 and 2005.
ACQUISITIONS, DIVESTMENTS AND RESTRUCTURING
During January-June, M-real purchased all the Metsä Tissue shares
owned by SCA and other shareholders. Metsä Tissue was delisted from
the Main List of Helsinki Exchanges on 19 June. The total price of
the shares and stock options was about EUR 128 million.
In March, M-real purchased 24.7 per cent of the shares in Oy Hangö
Stevedoring Ab, becoming the companys sole owner. Metsä Tissues
holding in its subsidiary Zaklady Papiernicze Krapkowicach SA rose to
100 per cent during the report period.
The acquisition of the Czech office paper merchant Narpex, which Map
Merchant Group agreed, entered into force in the Czech Republic in
January. Furthermore, Map Merchants Group acquired the shares held by
minority shareholders in its Danish subsidiary Schramm-Papirgros A/S
in accordance with the shareholder agreement in January. In March,
Metsä-Botnia purchased 60 per cent of the shares in the Uruguayan
company Compania Forestal Oriental S.A (FOSA) from Shell
International Renewables BV.
In June, M-real announced it had made a bid to the Portuguese State
for a 25 per cent stake in the Portuguese pulp and paper company
Portucel Group. As part of its offer, M-real was to transfer its Home
& Office business area to Portucel. In September, M-real issued a
press release announcing that the company had not reached its
objectives in the negotiations with the Portuguese government
following its tender offer. In practice, this meant retracting the
offer.
In June, M-real announced an agreement with IBM Global Services
concerning transfer of M-reals own information technology services
and the entire operations of its associated company Logisware Oy to
IBMs organization. The agreement entered into force on 1 September
2003.
In October, M-real announced it was closing its present market pulp
business at the Lielahti chemithermal mechanical pulp mill and would
use the mills entire production in its own paperboard manufacture.
FINANCING
Interest-bearing net liabilities amounted to EUR 3,132 million at the
end of September (Dec. 2002: 3,019).
The equity ratio was 33.1 per cent (Sep. 2002: 33.8, Dec. 2002: 34.2)
and the gearing ratio was 132 per cent (Sep. 2002: 121, Dec. 2002:
119).
Liquidity is good. The Groups liquidity at the end of September was
EUR 1,436 million, of which EUR 1,278 million consisted of committed
long-term credit facilities and EUR 158 million represented liquid
funds and investments. In addition, in order to meet its short-term
financing needs the Group had at its disposal non-binding domestic
and foreign commercial paper programmes and credit facilities
amounting to about EUR 600 million.
At the end of September an average of 3.2 months of net foreign
currency flow was hedged. The degree of hedging during the report
period has varied between 3 and 5 months. At the end of the report
period, about 103 per cent of the foreign shareholders equity was
hedged.
In August Moody´s Investor Service placed Baa3/PRIME-3 ratings of M-
real and Metsä Group Financial Services Oy on review for possible
downgrade.
At the end of September the Groups liabilities were tied to fixed
interest rates for a period of 18 months. During January-September,
the interest rate maturity has varied from 12 to 18 months.
In September, Metsä-Botnia signed an agreement on a five-year EUR 210
million syndicated revolving credit facility. The credit will be used
as a general stand-by credit facility for the company and also for
refinancing the existing loan arrangement.
SHARES
The highest price of M-reals Series B shares on Helsinki Exchanges
during the January-September period was EUR 8.99, whereas the lowest
was EUR 6.21. The average share price was EUR 7.17, compared with EUR
8.28 in 2002. The price of the Series B share was EUR 7.82 at the end
of the report period on 30 September 2003.
Turnover of the Series B share was EUR 429 million, or 42 per cent of
the shares outstanding. The market value of the Series A and B shares
on 30 September 2003 totalled EUR 1,404 million.
As of 30 September 2003 Metsäliitto Osuuskunta owned 38.5 per cent of
M-real Corporations shares and 64.2 per cent of the voting rights
conferred by these shares. International investors owned 35.3 per
cent of the shares.
The Board of Directors does not have valid authorizations to carry
out a share issue or issues of convertible bonds or bonds with
warrants.
NEAR-TERM OUTLOOK
The recession in Europe is still continuing and an upswing is not
expected over the next few months. In the United States, there are
patchy signs of a pick-up in the economy and paper consumption, but
the main economic indicators still do not clearly point the course
developments will take in the near-term. In Europe there are no
unambiguous signs of an improvement in the demand for paper.
Nevertheless, a perceptible seasonal upswing in the demand for coated
papers in September-November seems to be under way. Production
curtailments will have to be continued over the next few months.
Apart from the world economy and foreign exchange rates, fourth-
quarter earnings will be affected by shutdowns, in line with
collective bargaining agreements, at the Finnish mills in December. M-
reals fourth-quarter result is likely to be in the red.
Espoo, 27 October 2003
BOARD OF DIRECTORS
BUSINESS AREAS AND MARKET TRENDS
Consumer packaging
III II I IV III 2002 II-III
03 03 03 02 02 03
change
Turnover 214. 211. 229. 227. 231. 921. 1.5%
8 6 9 0 7 1
Operating profit 15.2 2.0 18.6 7.0 25.3 83.4
Operating profit % 7.1 0.9 8.1 3.1 10.9 9.1
Return on capital 6.8 1.3 7.8 3.7 11.1 9.1
employed %
Mill deliveries 1,000 265 265 283 283 284 1.12 0.0%
t 9
Board mills capacity 87 78 94 92 94 91
utilization rate %
The Consumer packaging business areas operating profit improved over
the previous quarter and was EUR 15.2 million (2.0). The previous
quarters weak earnings were attributable to the strong drop in
demand in the main markets, the appreciation of the euro and the low
capacity utilization rate of the new production line at Äänekoski.
Cost-saving measures that have been carried out improved
profitability in the report period. Delivery volumes remained at the
previous quarters level, but were down 7 per cent on the same period
last year. Euro-denominated average prices declined by about 1 per
cent on the third quarter. Capacity utilization of the new production
line at Äänekoski remained low and profitability was weak. The
average capacity utilization rate was 87 per cent (78). The order
book at the end of September was 13 days.
Total demand for folding boxboard in Europe increased by 3 per cent
over the previous quarter. All in all, M-reals deliveries of folding
boxboard were at the same level as the second quarter. Deliveries to
Europe grew in line with aggregate demand and were up by 3 per cent.
However, delivery volumes to the USA and Asia fell short of the level
reached in the previous report period. No significant change occurred
in the average price of folding boxboard during the report period
compared with the previous period.
The total volume of linerboard delivered was on a par with the second
quarter. Demand in North America has improved and deliveries were up
by 17 per cent from the second quarter. The average price remained at
the previous level.
Demand for fluting remained weak. Nevertheless , deliveries were up
by 7 per cent on the previous quarter. Average prices weakened
somewhat.
Worldwide demand for wallpaper base weakened further. The volume of
deliveries held up at the previous quarters level. Average prices
declined slightly.
Commercial printing
III II I IV III 2002 II-III
03 03 03 02 02 03
change
Turnover 364. 372. 403. 368. 403. 1,638. -2.1%
9 8 6 1 6 4
Operating profit -2.2 5.1 18.3 16.6 22.9 106.7
Operating profit % -0.6 1.4 4.5 4.5 5.7 6.5
Return on capital -0.4 1.4 5.3 4.4 5.6 7.1
employed %
Mill deliveries 1,000 433 439 460 425 419 1,757 -1.4%
t
Capacity utilization 82 83 86 79 74 81
rate %
The Commercial printing business area reported an operating loss of
EUR 2.2 million (profit of 5.1). The decline in the operating result
was due mainly to a lower delivery volume. The average price in euros
slipped a bit compared with the previous quarter.
Deliveries by west European producers of coated fine paper rose by 4
per cent, compared with the previous quarter. The delivery volume of
the Commercial printing business areas products fell by 1 per cent.
The average running time of the paper machines was one day shorter
than in the previous quarter and the capacity utilization rate was 82
per cent (83). At the end of September, orders for 10 days of
production had been placed in the order books.
Zanders was transferred to the Commercial printing business area as
from the beginning of 2003. The figures for 2002 have been adjusted
accordingly.
Home & Office
III II I IV III 2002 II-III
03 03 03 02 02 03
change
Turnover 151. 170. 191. 200. 183. 782. -11.3%
3 5 6 8 4 7
Operating profit 3.9 13.9 21.8 19.6 28.3 102.
8
Operating profit % 2.6 8.2 11.4 9.8 15.4 13.1
Return on capital 2.0 5.7 9.4 10.0 11.0 11.0
employed %
Mill deliveries 207 229 246 211 218 902 -9.6%
1,000 t
Capacity utilization 73 89 93 79 88 89
rate %
The Home & Office business area generated turnover of EUR 151.3
million (170.5) and operating profit of EUR 3.9 million (13.9).
Profitability was weakened by the fall in prices in west Europe. In
particular, the drop in the delivery volume, which declined on a
seasonal basis and the tough price competition, weakened profits.
Deliveries by west European producers of uncoated fine paper declined
by 8 per cent compared with the previous quarter. The Home & Office
business areas delivery volume declined by 10 per cent. The average
running time of the paper machines was 13 days shorter than in the
previous quarter. Owing to low demand and the fall in product stocks,
the capacity utilization rate was only 73 per cent (89). The order
book at the end of September was about two weeks.
Publishing
III II I IV III 2002 II-III
03 03 03 02 02 03
change
Turnover 199. 187. 204. 204. 191. 790. 6.5%
3 1 2 0 0 1
Operating profit 12.1 -6.7 10.3 8.8 16.5 43.1
Operating profit % 6.1 -3.6 5.0 4.3 8.6 5.5
Return on capital 4.0 -2.1 3.5 2.7 5.8 3.6
employed %
Mill deliveries 265 258 269 255 234 977 2.7%
1,000 t
Capacity utilization 84 84 93 87 87 84
rate %
The Publishing business areas operating profit was EUR 12.1 million
(-6.7 ). Profitability improved substantially compared to the
previous quarters weak performance. However, the Q2 figures were
adversely affected by annual maintenance costs for the Finnish mills.
The earnings improvement was attributable to better production
efficiency at all the mills and a higher delivery volume.
Deliveries by west European producers of coated magazine paper (LWC)
rose by 3 per cent on the previous quarter. The Publishing business
areas delivery volume also rose by 3 per cent. The average running
time of the paper machines was 2 days longer than in the previous
quarter and the capacity utilization rate was 84 per cent (84). The
order book was 15 days at the end of September.
Map Merchant Group
III II I IV III 2002 II-III
03 03 03 02 02 03
change
Turnover 332. 345. 367. 375. 371. 1,542. -3.6%
5 0 5 0 7 8
Operating profit -2.7 3.4 5.4 -9.3 -5.9 -14.9
Operating profit % -0.8 1.0 1.5 -2.5 -1.6 -1.0
Return on capital -2.3 4.0 5.8 -9.0 -4.0 -3.0
employed %
Delivery volumes 312 317 328 311 307 1,270 -1.6%
1,000 t
The Map paper merchanting business area reported an operating loss of
EUR 2.7 million (3.4). The weakening of profitability was due to the
fall in the delivery volume and non-recurring write-downs of about 2
million euros on real-estate properties. The market situation
remained difficult.
OTHER BUSINESSES
Metsä Tissue Corporation
III II I IV III 2002 II-III
03 03 03 02 02 03
change
Turnover 164. 169. 164. 170. 162. 647. -2.4 %
9 0 7 7 2 8
Operating profit 13.8 8.3 11.7 5.9 17.2 43.1
Operating profit % 8.4 4.9 7.1 3.5 10.6 6.7
Return on capital 16.6 10.2 14.5 7.6 21.0 13.2
employed %
Metsä Tissues operating profit in the third quarter was EUR 13.8
million (8.3). Turnover and delivery volume declined on a seasonal
basis. Profitability was boosted by lower raw material costs and an
improved product mix.
Operating profit in January-September was EUR 33.8 million (Jan.-Sep.
2002: 37.2 million). Profitability was boosted by the rise in the
delivery volume together with an improved product range.
Profitability was weakened mainly by paper machine maintenance
shutdowns and the extra costs of starting up new production lines.
Average selling prices were slightly below the previous years level.
M-REAL GROUP (All figures unaudited)
PROFIT AND LOSS ACCOUNT 1-9/03 % 1-9/02 %
(EUR million)
Turnover 4 569.9 100.0 4 976.9 100.0
Interest in -1.1 -3.0
associated companies
Other operating 50.0 46.7
income
Operating expenses 4 147.4 4 396.0
Depreciation 360.3 351.0
Operating profit 111.1 2.4 273.6 5.5
Net exchange 11.0 -35.5
gains/losses
Other financial -97.1 -1.9 -113.9 -3.1
income
and expenses
Profit before 25.0 0.5 124.2 2.4
extraordinary items
Extraordinary items 0.0 144.5
Profit before taxes and 25.0 0.5 268.7 5.4
minority interest
Taxes -23.0 -58.0
Minority interest -1.0 -8.7
Profit for the period 1.0 0.0 202.0 4.1
PROFIT AND LOSS ACCOUNT Change % 1-12/02 %
(EUR million)
Turnover -407.0 -8.2 6 564.2 100.0
Interest in 1.9 -4.9
associated companies
Other operating 3.3 73.4
income
Operating expenses 248.6 5 850.7
Depreciation -9.3 457.7
Operating profit -162.5 -59.4 324.3 4.9
Net exchange 46.5 -30.5
gains/losses
Other financial 16.8 -159.5 -2.9
income
and expenses
Profit before -99.2 -79.9 134.3 2.0
extraordinary items
Extraordinary items -144.5 144.5
Profit before taxes and -243.7 -90.7 278.8 4.2
minority interest
Taxes 35.0 -59.8
Minority interest 7.7 -10.1
Profit for the period -201.0 -99.5 208.9 3.2
PROFIT AND LOSS ACCOUNT 7-9/03 %
(EUR million)
Turnover 1 467.2 100.0
Interest in 7.2
associated companies
Other operating 14.7
income
Operating expenses 1 339.5
Depreciation 120.7
Operating profit 28.9 2.0
Net exchange -0.5
gains/losses
Other financial -32.3 -2.3
income
and expenses
Profit before -3.9 -0.3
extraordinary items
Extraordinary items 0.0
Profit before taxes and -3.9 -0.3
minority interest
Taxes -14.0
Minority interest -0.1
Profit for the period -18.0 -1.2
Taxes include taxes corresponding to profit for the period.
BALANCE SHEET 9/2003 % 9/2002 %
(EUR million)
Assets
Fixed assets 4 806.2 67.0 4 874.8 65.5
Current assets
Inventories 822.2 11.5 823.2 11.1
Other current assets 1 381.6 19.3 1 512.9 20.3
Liquid funds 158.4 2.2 230.0 3.1
Total 7 168.4 100.0 7 440.9 100.0
Liabilities
Shareholders´ equity 2 349.7 32.8 2 446.8 32.9
Minority interest 22.3 0.3 67.8 0.9
Provisions for liabilities 58.6 0.8 102.4 1.4
and charges
Long-term liabilities 2 904.3 40.5 2 954.3 39.7
Short-term liabilities 1 833.5 25.6 1 869.6 25.1
Total 7 168.4 100.0 7 440.9 100.0
BALANCE SHEET 12/2002 %
(EUR million)
Assets
Fixed assets 4 934.5 66.6
Current assets
Inventories 814.9 11.0
Other current assets 1 460.9 19.7
Liquid funds 199.9 2.7
Total 7 410.2 100.0
Liabilities
Shareholders´ equity 2 461.0 33.2
Minority interest 74.6 1.0
Provisions for liabilities 66.3 0.9
and charges
Long-term liabilities 3 030.3 40.9
Short-term liabilities 1 778.0 24.0
Total 7 410.2 100.0
CASH FLOW STATEMENTS 1-9/03 1-9/02 1-12/02 7-9/03
(EUR million)
Profit before extraordinary 25.0 124.2 134.3 -3.9
items
Depreciation 360.3 351.0 457.7 120.7
Taxation -38.7 -64.0 -56.7 -10.4
Other changes 8.2 2.0 -14.3 -15.3
Funds from operations 354.8 413.2 521.0 91.1
Change in working capital -62.3 58.0 145.4 16.6
Cash flow from operations 292.5 471.2 666.4 107.7
Gross capital -289.9 -180.0 -310.0 -46.8
expenditures 1)
Disposal and other changes 0.0 245.4 223.9 0.0
in fixed assets
Cash flow after capital 2.6 536.6 580.3 60.9
expenditure
Interest-bearing net debt of -8.5 9.4 -9.0 0.0
companies acquired and
divested
Dividend -107.4 -108.4 -108.4 0.0
Change in interest-bearing -113.3 437.6 462.9 60.9
liabilities
(+ decrease / - increase)
1) Excl. interest-bearing net debt of acquired companies.
KEY FIGURES 1-9/03 1-9/02 1-12/02 7-9/03
Earnings per share EUR 0.01 0.32 0.36 -0.10
(diluted 1-9/03; 0.01 EUR)
Return on capital employed % 2.9 6.5 5.8 2.3
Return on equity % 0.1 3.6 3.0 -3.0
Gross capital expenditures 290 180 310 47
EUR million 1)
Personnel, averages 20 562 21 276 21 070 21 014
9/03 9/02 12/02
Shareholders´ equity per 13.13 13.67 13.75
share EUR
Equity ratio % 33.1 33.8 34.2
Gearing ratio % 132 121 119
Securities and guarantees EUR 9/03 9/02 12/02
million
For own loans 400 356 487
For associated companies 0 0 0
For affiliated companies 5 4 26
For others 10 23 5
Total 415 383 518
Open derivative contracts Gross Gross Gross
EUR million amount amount amount
9/03 9/02 12/02
Interest rate derivatives 13 214 15 545 9 998
Currency derivatives 6 616 6 626 4 832
Total 19 830 22 171 14 830
1) Excl. interest-bearing net debt of acquired companies.
TURNOVER Quarter I-III Quarterly
EUR Million 2003 2002 III 03 II 03 I 03 IV 02 III 02
Consumer 656.3 694.1 214.8 211.6 229.9 227.0 231.7
packaging
Commercial 1141.3 1270.3 364.9 372.8 403.6 368.1 403.6
printing
Home & Office 513.4 581.9 151.3 170.5 191.6 200.8 183.4
Publishing 590.6 586.1 199.3 187.1 204.2 204.0 191.0
Map Merchant 1045.0 1167.8 332.5 345.0 367.5 375.0 371.7
Group
Metsä Tissue 498.6 477.1 164.9 169.0 164.7 170.7 162.2
Internal sales 124.7 199.6 39.5 51.8 33.4 41.7 60.5
and other
operations
GROUP TOTAL 4569.9 4976.9 1467.2 1507.8 1594.9 1587.3 1604.1
OPERATING PROFIT Quarter I-III Quarterly
AND RESULT
EUR Million 2003 2002 III 03 II 03 I 03 IV 02 III 02
Consumer 35.8 76.4 15.2 2.0 18.6 7.0 25.3
packaging
Commercial 21.2 90.1 -2.2 5.1 18.3 16.6 22.9
printing
Home & Office 39.6 83.2 3.9 13,9 21.8 19.6 28.3
Publishing 15.7 34.4 12.1 -6.7 10.3 8.8 16.5
Map Merchant 6.1 -5.6 -2.7 3.4 5.4 -9.3 -5.9
Group
Metsä Tissue 33.8 37.2 13.8 8.3 11.7 5.9 17.2
Other -41.1 -42.1 -11.2 -11.2 -18.7 2.1 -7.2
operations
OPERATING 111.1 273.6 28.9 14.8 67.4 50.7 97.1
PROFIT
% of turnover 2.4 5.5 2.0 1.0 4.2 3.2 6.1
Net exchange 11.0 -35.5 -0.5 5.3 6.2 5.0 -16.9
gains/losses
Other financial -97.1 -113.9 -32.3 -29.8 -35.0 -45.6 -38.7
income and
expenses
PROFIT BEFORE 25.0 124.2 -3.9 -9.7 38.6 10.1 41.5
EXTRAORDINARY
ITEMS
% of turnover 0.5 2.5 -0.3 -0.6 2.4 0.6 2.6
OPERATING Quarter I-III Quarterly
PROFIT %
2003 2002 III 03 II 03 I 03 IV 02 III 02
Consumer 5.5 11.0 7.1 0.9 8.1 3.1 10.9
packaging
Commercial 1.9 7.1 -0.6 1.4 4.5 4.5 5.7
printing
Home & Office 7.7 14,3 2.6 8.2 11.4 9.8 15.4
Publishing 2.7 5.9 6.1 -3.6 5.0 4.3 8.6
Map Merchant 0.6 -0.5 -0.8 1.0 1.5 -2.5 -1.6
Group
Metsä Tissue 6.8 7.8 8.4 4.9 7.1 3.5 10.6
GROUP TOTAL 2.4 5.5 2.0 1.0 4.2 3.2 6.1
RETURN ON CAPITAL I - III Q Year
EMPLOYED %
2003 2002 2001
Consumer packaging 5.3 9.1 14.9
Commercial printing 2.1 7.1 6.2
Home & Office 5.8 11.0 6.2
Publishing 1.8 3.6 5.7
Map Merchant Group 2.5 -3.0 -0.8
Metsä Tissue 13.8 13.2 10.3
GROUP TOTAL 2.9 5.8 6.9
CAPITAL EMPLOYED, 9/03 12/02 12/01
EUR Million
Consumer packaging 969.0 991.0 934.0
Commercial printing 1 587.4 1 567.5 1 621.1
Home & Office 860,0 973,7 1 018,4
Publishing 1 240.9 1 256.2 1 378.2
Map Merchant Group 392.1 410.4 484.8
Metsä Tissue 334.8 325.5 342.3
Other assets 411.5 372.8 515.1
GROUP TOTAL 5 795.6 5 897.1 6 293.8
PERSONNEL, I - III Q I - III Q I - IV Q
Average 2003 2002 2002
Consumer packaging 3 106 3 196 3 151
Commercial printing 5 340 5 916 5 831
Home & Office 2 123 2 127 2 125
Publishing 1 618 1 834 1 769
Map Merchant Group 2 566 2 779 2 745
Metsä Tissue 3 337 2 950 3 067
Other operations 2 472 2 474 2 382
GROUP TOTAL 20 562 21 276 21 070
PRODUCTION Quarter I-III Quarterly
1000 tonnes 2003 2002 III 03 II 03 I 03
Commercial printing 1 338 1 321 431 446 461
Home & Office 670 708 200 233 237
Publishing 1) 807 734 270 254 283
Paperboard 509 506 172 154 183
Fluting 136 167 50 38 48
Liner 2) 110 114 36 33 41
CTMP 247 204 88 77 82
Metsä-Botnias pulp 2) 854 808 305 269 280
M-reals pulp 904 883 290 303 311
PRODUCTION Quarterly
1000 tonnes IV 02 III 02 II 02 I 02 IV 01
Commercial printing 436 406 448 467 432
Home & Office 207 231 233 244 207
Publishing 1) 256 244 235 255 242
Paperboard 173 167 169 170 152
Fluting 57 64 49 54 60
Liner 2) 37 40 39 35 36
CTMP 76 79 63 62 49
Metsä-Botnias pulp 2) 249 294 250 264 234
M-reals pulp 308 290 304 289 264
1) Includes 50 % of the production of Albbruck (until 30.6.2002).
2) Equals to M-real´s ownership (47 %).
