Metsä Board Corporation’s operating result excluding non-recurring items was EUR 49 million in January–September 2012

Metsä Board Corporation Interim Report 1 January–30 September 2012, 1 November 2012 at 12 noon

Result for January–September 2012

  • Sales were EUR 1,599 million (Q1–Q3/2011: 1,961).
  • The operating result excluding non-recurring items was EUR 49 million (81). The operating result including non-recurring items was EUR 179 million (1).
  • The result before taxes excluding non-recurring items was EUR 18 million (33). The result before taxes including non-recurring items was EUR 149 million (-51).
  • Earnings per share excluding non-recurring items were EUR 0.05 (0.06) and including non-recurring items EUR 0.40 (-0.20).

Result for the third quarter of 2012

  • Sales were EUR 532 million (Q2/2012: 522).
  • The operating result excluding non-recurring items was EUR 25 million (19). The operating result including non-recurring items was EUR 22 million (161).
  • The result before taxes excluding non-recurring items was EUR 10 million (17). The result before taxes including non-recurring items was EUR 8 million (159).
  • Earnings per share excluding non-recurring items were EUR 0.02 (0.05) and including non-recurring items EUR 0.02 (0.43).

Events in the third quarter of 2012

  • Delivery volumes of paperboard and coated paper increased.
  • Delivery volumes of uncoated paper and pulp decreased.
  • There were no material changes in paper and paperboard prices. The market price of pulp decreased.

Events after the period

  • The biopower plant owned by Pohjolan Voima and Leppäkosken Sähkö was inaugurated at the Kyro mill.

“Our profitability improved further in the third quarter. Favourable development in the paperboard business continued, and delivery volumes increased as expected. Despite the extensive maintenance shutdown at the Husum mill, the operating result of the paper and pulp business remained at the second quarter level. 

The paper and paperboard order books and operating rates are currently at a normal level. Folding boxboard order inflows have in recent weeks slowed down somewhat, but the price situation is stable. Paperboard delivery volumes are estimated to be slightly lower in the fourth quarter than in the third quarter, due to seasonal factors. Market prices of pulp are expected to increase in the fourth quarter, but it is estimated that the average price of deliveries will be slightly lower than in the third quarter. The overall situation in the global economy is currently uncertain, which makes business forecasting more difficult than in normal conditions.

We completed the Paperboard business area’s investment programme as planned with the inauguration of the biopower plant at the Kyro mill. Our production machinery is now top class in the world, and our folding boxboard capacity, which was expanded by 150,000 annual tonnes, will be fully available from the beginning of 2013. New capacity is necessary in order for us to ensure the availability of board for our customers in all situations.”

Mikko Helander, CEO

  

KEY FIGURES 2012 2012 2012 2011 2012 2011 2011
  Q3 Q2 Q1 Q3 Q1-Q3 Q1-Q3 Q1-Q4
Sales, EUR million 532 522 545 616 1,599 1,961 2,485
EBITDA, EUR million 51 189 25 24 265 149 -23
  excl. non-recurring items, EUR million 54 47 34 36 135 172 180
EBITDA, % 9.6 36.2 4.6 3.9 16.6 7.6 -0.9
  excl. non-recurring items, % 10.2 9.0 6.2 5.8 8.4 8.8 7.2
Operating result, EUR million 22 161 -4 -13 179 1 -214
  excl. non-recurring items, EUR million 25 19 5 6 49 81 59
EBIT, % 4.1 30.8 -0.7 -2.1 11.2 0.1 -8.6
  excl. non-recurring items, % 4.7 3.6 0.9 1.0 3.1 4.1 2.4
Result before taxes, EUR million 8 159 -18 -29 149 -51 -281
  excl. non-recurring items, EUR million 10 17 -9 -11 18 33 0
Result for the period, EUR million 8 140 -15 -33 133 -64 -273
  excl. non-recurring items, EUR million 10 14 -6 -15 18 20 8
Result per share, EUR 0.02 0.43 -0.05 -0.11 0.40 -0.20 -0.83
  excl. non-recurring items, EUR 0.02 0.05 -0.02 -0.05 0.05 0.06 0.02
Return on equity, % 3.9 72.9 -8.4 -14.1 22.7 -8.9 -31.5
  excl. non-recurring items, % 4.8 7.3 -3.1 -6.3 3.1 2.7 0.9
Return on capital employed, % 5.2 35.9 -0.4 -1.5 13.4 0.4 -9.9
  excl. non-recurring items, % 5.7 5.8 1.7 2.0 4.4 5.4 3.4
Equity ratio at end of period, % 31.1 31.0 27.8 32.7 31.1 32.7 27.4
Gearing ratio at end of period, % 138 138 154 128 138 128 154
Net gearing ratio at end of period, % 70 73 104 83 70 83 106
Shareholders' equity per share at end of period, EUR 2.51 2.46 2.21 2.81 2.51 2.81 2.23
Interest-bearing net liabilities, EUR million 580 595 758 772 580 772 783
Gross investments, EUR million 11 17 10 17 38 60 95
Deliveries, 1 000 tonnes              
  Paperboard 306 289 295 346 890 1,099 1,388
  Paper 169 165 185 260 519 718 908
               
Personnel at the end of period 3,337 3,597 3,818 4,163 3,337 4,163 4,070
               
Deliveries are not comparable due to restructuring.              
EBITDA = Earnings before interest, taxes, depreciation and impairment charges

Near-term outlook

The situation in the global economy is currently uncertain, which makes business forecasting more difficult than in normal conditions.

Folding boxboard order books and operating rates are currently at a normal level, but the order inflows have recently slowed down somewhat. The average prices of folding boxboard are not expected to change materially in the coming months.

Linerboard order books and operating rates are at a strong level. Prices of linerboard will be slightly higher in the fourth quarter than in the third quarter, as a result of the price increase implemented in September.

It is estimated that in the fourth quarter the delivery volume of folding boxboard and linerboard will be slightly lower than in the third quarter, due to the seasonally weaker December. The slight increase in the price of linerboard is, however, not estimated to be sufficient to completely cover the negative result impact of the seasonally lower delivery volumes in the fourth quarter in the Paperboard business area.

The delivery volumes of paper and pulp are in the fourth quarter expected to be at least at the third quarter level. No material changes are on the horizon in paper prices. The USD denominated market price of long fibre pulp is estimated to increase somewhat during the fourth quarter. All in all, the average price of Metsä Board’s pulp deliveries in the fourth quarter is however estimated to be slightly lower than in the third quarter.

Production costs are not estimated to change materially in the coming months. 

Metsä Board’s operating result in the fourth quarter of 2012, excluding non-recurring items, is expected to be roughly at the third quarter of 2012 level.

Disclosure procedure

Metsä Board Corporation follows the disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority and hereby publishes its Interim Report for January-September 2012 enclosed to this stock exchange release. Metsä Board's complete Interim Report is attached to this release in pdf-format and is also available on the company's web site at www.metsaboard.com.

 

METSÄ BOARD CORPORATION

 

Further information:

Matti Mörsky, CFO, tel. +358 10 465 4913
Juha Laine, Vice President, Investor Relations and Communications, tel. +358 10 465 4335

More information will be available starting from 1 p.m. on 1 November 2012. A conference call held in English for investors and analysts starts at 3 p.m. (EET). Conference call participants are requested to dial in and register a few minutes prior to the start of the conference call on the following numbers:

Europe: +44 (0)20 7162 0025

US: +1 334 323 6201

The conference ID is 924020.

 

Metsä Board is Europe’s leading manufacturer of folding boxboard, the world’s leading manufacturer of coated white-top kraftliners and a significant supplier of paper, which offers customers high-quality cartonboard and papers for consumer and retail packaging as well as graphics industry and office end uses. The company’s sales network serves brand owners, carton printers, manufacturers of corrugated boards, printing houses, merchants and office suppliers. Metsä Board is part of Metsä Group and its shares are listed in NASDAQ OMX Helsinki. In 2011, the company’s sales totalled approximately EUR 2.5 billion. The company has approximately 3,300 employees.

www.metsaboard.com

 

About Us

Metsä Boardwww.metsaboard.com Metsä Board is a leading European producer of premium fresh fibre paperboards including folding boxboards, food service boards and white kraftliners. Our lightweight paperboards are developed to provide better, safer and more sustainable solutions for consumer goods as well as retail-ready and food service applications. We work together with our customers on a global scale to innovate solutions for better consumer experiences with less environmental impact. The pure fresh fibres Metsä Board uses are a renewable resource, traceable to origin in sustainably managed northern forests. The global sales network of Metsä Board supports customers worldwide, including brand owners, retailers, converters and merchants. In 2018, the company’s sales totalled EUR 1.9 billion, and it has approximately 2,400 employees. Metsä Board, part of Metsä Group, is listed on the Nasdaq Helsinki.

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