Metsäliitto Group s operating profit excluding non-recurring items
was up 56% amounting to EUR 270 million in January-September
Metsäliitto Group Stock Exchange release 25.10.2007
Result for January-September
- Sales EUR 6,604 million (6,919). Comparable sales grew by 7 per
cent compared with the corresponding period in 2006.
- Operating profit excluding non-recurring items improved by 56 per
cent, amounting to EUR 270 million (173). Operating result including
non-recurring items increased to EUR 203 million (139).
- Result before tax and excluding non-recurring items was EUR 96
million (32).
Result for July-September
- Sales EUR 2,178 million (2,246). Comparable sales grew by 8 per
cent compared with the corresponding period in 2006.
- Operating profit excluding non-recurring items improved by 43 per
cent, amounting to EUR 93 million (65). Operating result including
non-recurring items increased to EUR 98 million (68).
- Result before tax and excluding non-recurring items was EUR 30
million (11).
Events during the third quarter of 2007
- M-real sold Map Merchant Group to Antalis, a wholly-owned
subsidiary of Sequana Capital. The total value of the sale was EUR
382 million and M-real is expected to book a sales gain of
approximately EUR 80 million for the transaction. The EU Commission
has approved the transaction on 24 October.
- The construction and installation works at Metsä-Botnia's pulp mill
in Uruguay are, technically, nearly complete. The start-up process
will be set in motion as soon as the permit procedure with the
Uruguayan environmental authorities has been finalised.
- Metsäliitto's new Wood Supply organisation started operations in
the beginning of September 2007."Metsäliitto Group's performance improved markedly compared to the
previous year despite the difficult operating environment. This
testifies to the efficiency of our extremely hard restructuring
efforts. As a result of divestments and restructuring, within the
past 18 months the Group's personnel will have been reduced by 9,000
by the end of this year, which is a strong signal of the drastic
nature of the restructuring process. Due to seasonal factors, the
fourth-quarter result of 2007 will remain below the previous
quarter's levels. The strict strategic efforts aimed at transforming
the Group into a new kind of forest company will also continue during
the last quarter of the year and beyond the year-end."
Kari Jordan, President and CEO, Metsäliitto Group
Metsäliitto Group
Income statement 2007 2006 2007 2006 2006
(EUR mill.) 1-9 1-9 Q3 Q3 1-12
Sales 6 604 6 919 2 178 2 246 9 271
Other operating income 100 129 37 40 175
Operating expenses -6 143 -6 533 -2 008 -2 092 -8 761
Depreciation and impairment -358 -376 -109 -126 -707
losses
Operating profit 203 139 98 68 -22
Share of results in associates 5 4 2 2 6
Net exchange gains / losses -4 6 -1 4 6
Other financial income & -176 -151 -64 -60 -212
expenses
Result before tax 28 -2 35 14 -222
Income tax -65 -46 -18 -21 -37
Result for the period -37 -48 17 7 -259
Metsäliitto Group
Key figures 2007 2006 2007 2006 2006
1-9 1-9 Q3 Q3 1-12
Operating profit, EUR mill. 203 139 98 68 -22
- " -, excluding non-recurring 270 173 93 65 254
items
Return on capital employed, % 4.8 3.2 6.5 4.4 0.1
- " -, excluding non-recurring 6.2 3.9 6.1 4.2 4.4
items
Return on equity, % -2.1 -2.4 2.9 -1.1 -10.3
- " -, excluding non-recurring 1.7 -0.7 2.0 -1.5 0.7
items
Equity ratio, % 27.8 29.7 27.8 29.7 28.0
Net gearing ratio, % 160 145 160 145 150
Interest-bearing net liabilities, 3 633 3 787 3 633 3 787 3 527
EUR mill.
Capital expenditure, EUR mill. 318 552 124 163 744
Personnel at end of period 23 325 28 762 23 325 28 762 25 007
Business areas
Sales and Operating Wood Paper Tissue and
profit Wood Products Pulp *) and Cooking
1-9/2007 Supply Industry Industry Board Papers
(EUR mill.) Industry
Sales 1 243 1 078 1 028 4 158 632
Other operating income 11 8 14 213 6
Operating expenses -1 218 -964 -805 -3 974 -579
Depreciation & -4 -34 -77 -253 -37
impairment losses
Operating profit 32 88 160 144 22
*) Represents 100%. The Metsäliitto Group consolidates 53% of the
Pulp Industry's figures.
The Interim Report is unaudited
METSÄLIITTO GROUP
INTERIM REPORT 1 January - 30 September 2007
Sales and result
Metsäliitto Group's sales for January-September were EUR 6,604
million (6,919). As a result of divestments and capacity closures,
sales fell by 4.6 per cent from the corresponding period last year.
Comparable sales grew by approximately 7 per cent.
Operating profit excluding non-recurring items was EUR 270 million
(173). Net non-recurring items totalled EUR -67 million (-34), of
which EUR -62 million (0) were booked during the first quarter of the
year, EUR -11 million (-37) during the second quarter of the year and
EUR +6 million (+3) during the third quarter of the year. The most
important non-recurring items during the third quarter were the
reduction in the cost provisions for completing the closedown of the
Sittingbourne mill by approximately EUR 7 million, and the EUR 2.5
million provision for completing the closure of the converting unit
in the Canary Islands by the end of the year. The majority of the
non-recurring items booked during the year consist of cost provisions
related to profit improvement programme of M-real's operations.
Operating profit including non-recurring items was EUR 203 million
(139).
Metsäliitto Group's net financial expenses were 2.6 per cent (2.1) of
sales in January-September. Financial income was EUR 24 million (17),
income from associates was EUR 5 million (4) and financial expenses
were EUR 200 million (168). Net exchange gains/losses booked in
financial items were EUR -4 million (+6). At the end of September,
the exchange rate of the US dollar against the Euro was 12.0 per cent
weaker and that of the pound sterling 2.8 per cent weaker than at the
end of September last year. On average, the dollar weakened by 7.9
per cent and the pound by 0.1 per cent.
The result before tax and excluding non-recurring items was EUR 96
million (32) and including non-recurring items EUR 28 million (-2).
Taxes, including changes in deferred tax liability, were EUR 65
million (46).
The result for the period was EUR -37 million (-48), of which EUR +50
million (+27) was attributable to the owners of the parent company
and EUR -87 million (-75) to the minority.
The Group's return on capital employed was 4.8 per cent (3.2) and
return on equity was -2.1 per cent (-2.4). Excluding non-recurring
items, return on capital employed was 6.2 per cent (3.9) and return
on equity was 1.7 per cent (-0.7).
Balance sheet and financing
Metsäliitto Group's overall liquidity at the end of September was EUR
1.4 billion (31 December 2006: 2.0). Of this, 0.2 billion (0.2) was
in terms of liquid assets and investments, and 1.2 billion (1.8) in
binding credit facility agreements not included in the balance sheet.
In addition, the Group can satisfy short-term financial needs with
non-binding commercial paper schemes in Finland and abroad, as well
as credit lines amounting to EUR 0.6 billion.
The Group's equity ratio was 27.8 per cent in September and net
gearing ratio was 160 per cent (31 December 2006: 28.0% and 150%,
respectively). Interest-bearing net liabilities were EUR 3,633
million (31 December 2006: 3,527). The equity ratio of the parent
company, Metsäliitto Cooperative, was 53.0 per cent at the end of the
period under review and gearing ratio 37 per cent (31 December 2006:
51.7% and 23%, respectively).
Metsäliitto Cooperative's members' capital grew by EUR 16.5 million
net in January-September. The actual members' capital grew by EUR 6.9
million, the additional members' capital A by EUR 9.5 million and the
additional members' capital B by EUR 0.1 million. Metsäliitto
Cooperative had 131,157 members at the end of September (31 December
2006: 131,139).
Personnel
Metsäliitto Group employed an average of 24,389 people (29,388)
during the period under review. The reduction in the number of
personnel was a result of the divestments and restructuring. The
number of personnel was 23,325 (28,762) at the end of September. The
parent company, Metsäliitto Cooperative, employed 3,185 people
(3,185) at the end of the period.
Investments, acquisitions and divestments
In January-September, Metsäliitto Group's capital expenditure and
corporate acquisitions totalled EUR 318 million (552). The share of
Metsä-Botnia's total investments corresponding to Metsäliitto's
holding was EUR 168 million (218).
Capital expenditure
The bleaching alteration investment at Metsä-Botnia's Rauma mill was
introduced in June. The aim of the investment is to improve the
quality characteristics of pulp, enhance cost-efficiency and increase
the mill's production capacity.
In May, M-real announced that it would exercise its purchase option
for the gas combi power plant in Kyröskoski and the real properties
on which the Kyröskoski mills are located. The acquisition is worth
approximately EUR 13 million and was finalised on 1 July 2007.
In February, Metsäliitto Wood Products Industry decided to build a
birch plywood upgrading unit in Suolahti. The unit will start up at
the beginning of 2008. The new unit will employ some 20 people, and
the cost of the project is estimated at EUR 15 million.
Divestments
In July, M-real sold Map Merchant Group to Antalis. The total value
of the sale is EUR 382 million and M-real is expected to book a sales
gain of approximately EUR 80 million for the transaction. M-real's
net gearing ratio is estimated to decrease about 20 percentage
points due to the deal. The deal will also have a significant impact
on the net gearing ratio of the entire Metsäliitto Group. The EU
Commission has approved the transaction on 24 October.
On 31 May 2007, M-real sold the entire share capital of its
subsidiary Tako Carton Plant Ltd to Pyroll Oy. At the beginning of
June, M-real sold the entire share capital of its subsidiary Petöfi
Nyomda Kft to the German STI Group. The aggregate debt-free selling
price of these carton plants, located in Finland and Hungary, was
approximately EUR 35 million. As a result of these divestments,
M-real booked a loss of approximately EUR 2 million in its result for
the second quarter.
Metsäliitto Cooperative sold 18.3 per cent of Neomarkka Plc's shares
to Neomarkka's main owner, Reka Corporation. The selling price was
EUR 10.45 million and the sales gain for the deal was approximately
EUR 0.6 million.
Metsä-Botnia's Russian subsidiary Svir Timber acquired two Russian
harvesting companies in February. This enhances wood supply for the
Svir Timber sawmill and Metsä-Botnia's long-term strategy in Russia.
Pulp mill project in Uruguay
The construction and installation works at the Uruguay pulp mill are,
technically, nearly complete. The mill, which has a production
capacity of one million tonnes of bleached eucalyptus pulp, was
originally estimated to start up by the end of the third quarter of
2007. The cost estimate for the pulp mill project is USD 1.2 billion.
To commence commercial production the mill requires a final
environmental permit from Uruguayan authorities who are currently
finalising this procedure.
Business areas
Wood Supply
Wood Supply sales were EUR 1,243 million (1,082) in
January-September, and operating profit amounted to EUR 32 million
(30). Operating profit includes sales gains on fixed assets of
approximately EUR 3 million (4). Wood Supply Finland accounted for
EUR 864 million (859) of the sales and EUR 21 million (17) of the
operating profit.
Metsäliitto has carried out a reform of the organisation of Wood
Supply in Finland. Procurement districts were strengthened and
previous area organisations were abolished. The new organisation will
be implemented by the end of the year, but wood supply operations
have already been carried out according to the new model since 1
September 2007.
Wood trade had a brisk start in the autumn season in Finland.
Similarly to the spring season, supply was nevertheless largely
dominated by logs. The purchase volume of the forest industry from
private forests grew to approximately 41 million cubic metres, which
is about 16 million cubic metres more than the corresponding figure
last year.
Metsäliitto increased its purchasing target for 2007 to over 18
million cubic metres after the summer season. In January-September,
wood purchasing clearly outperformed the plan. The price of softwood
logs took a downturn, and the price development of pulpwood levelled
off.
Russia introduced new export duties on wood at the beginning of July.
Customer clearance procedures varied throughout the third quarter.
While felling started at a normal level after the summer, delivery
volumes to Finland remained clearly short of the previous year's
levels. In January-September, Metsäliitto's imports from Russia to
Finland amounted to 1.4 million cubic metres (2.0).
In the Baltic countries, the wood market overheated in the spring and
prices remained very high even in the early autumn. In Sweden, wood
trade was brisk, receiving a boost from the satisfactory increase in
prices and storm damage in Southern Sweden. In Central Europe, storm
damage increased the market supply of wood in the spring and summer,
yet in the early autumn fresh wood was already in short supply.
Due to the changed customer clearance procedures in Russia and
shortage of transportation equipment, the supply situation has been
difficult, particularly with pulpwood. While sufficient quantities of
wood were supplied to the mills, temporary arrangements were made to
supply Finnish plants with wood from areas affected by storm damage
in Sweden and Germany. In production, special arrangements such as
advancing maintenance shutdowns were necessary. Deliveries to the
mills totalled 27.5 million cubic metres (26.7) in the entire
operating area.
Wood Products
Metsäliitto Wood Products Industry's sales stood at EUR 1,078 million
(1,563), and operating profit was EUR 88 million (61). The decrease
in sales is particularly attributable to the divestment of Moelven
Industrier ASA, whose sales in the corresponding period last year
amounted to approximately EUR 600 million. Comparable sales increased
by 16 per cent during the period under review.
The demand for wood products is still at a good level and sales
prices have increased in all product groups. This trend is due to
strong growth in the economy and construction in Europe. Furthermore,
Metsäliitto Wood Products Industry has successfully managed to steer
its product portfolio towards more challenging and profitable end use
segments.
Implementation of the ongoing investment and cost-efficiency
programmes continued during the third quarter. The birch plywood
upgrading mill is scheduled to start up in the first quarter of 2008.
During the year, log prices have climbed so high in Finland that this
will significantly weaken Metsäliitto's cost competitiveness compared
with foreign operators. For this reason, Metsäliitto has been forced
to announce the initiation of statutory labour negotiations at two of
its sawmill units.
Pulp
Pulp Industry's sales stood at EUR 1,028 million (971), and operating
profit was EUR 160 million (152). Both sales and operating profit
improved due to the strong development of pulp price.
Foreign-currency-denominated market prices for softwood pulp were, on
average, 18 per cent higher compared with the corresponding period
last year. The average prices of hardwood pulp increased by 9 per
cent.
The price of pulp has risen steadily during the year. In Europe,
softwood pulp was selling at USD 730 and hardwood pulp at USD 670 in
January. The corresponding figures for September were USD 830 for
softwood pulp and USD 720 for hardwood pulp.
The most significant factors that negatively affected the result were
the weakening of the dollar against the euro and the increases in
wood raw material prices.
The pulp market remained stable throughout the year and demand was at
a good level. Pulp stocks in the entire supply chain have varied
between low and normal levels. The shortage of wood in Finland,
Russia and Indonesia caused disturbances in the supply of pulp and
necessitated unscheduled shutdowns.
M-real's result includes 30 per cent (Q3/06: 39%) of the Pulp
Industry's operating profit. In total, 53 per cent of the figures for
Pulp Industry are consolidated into Metsäliitto Group's financial
statements.
Paper and Board
Paper and Board Industry's sales totalled EUR 4,158 million (4,186),
and operating profit excluding non-recurring items was EUR 77 million
(31). While profitability improved due to successfully implemented
cost savings measures, it currently seems that the savings achieved
will not be quite able to offset the cost increases in 2007.
The average sale price of uncoated papers increased by approximately
9 per cent, while the market price of coated find papers was down
approximately one per cent on the previous year. The selling price of
magazine papers was also lower than in the previous year.
The profitability of board improved mainly due to higher delivery
volumes, since the market price of folding boxboard remained below
last year's levels. The profitability of the paper and board industry
was burdened by the weaker dollar and higher raw material costs.
Net non-recurring items totalled EUR +67 million (56) in
January-September. M-real's first-quarter operating result included a
non-recurring income of EUR 135 million from the sale of
Metsä-Botnia's shares to Metsäliitto Cooperative and a total of EUR
62 million as non-recurring expenses. The most important expense
items were the EUR 14 million and EUR 29 million cost provisions for
completing the closedown of mills at Sittingbourne and Wifsta. In
addition, EUR 16 million was entered as an impairment loss. During
the second quarter, M-real booked non-recurring expenses to a total
of EUR 13 million, of which EUR 11 million represented cost
provisions and impairment losses related to the profit improvement
programme of M-real's operations in Finland and EUR 2 million
represented losses on the sale of the carton plants. During the third
quarter, the cost provision for completing the closedown of the
Sittingbourne mill was reduced by EUR 7 million.
Operating profit including non-recurring items was EUR 144 million
(-25). Net interest and other financial expenses totalled EUR 119
million (96), income from associates was EUR 0 million (0) and net
exchange gains/losses booked as financial items were EUR -5 (+4).
The result for the period before tax was EUR 20 million (-117),
earnings per share were EUR -0.01 (-0.40) and return on capital
employed was 4.6 per cent (-0.2). Excluding non-recurring items, the
result was EUR -47 million (-61), earnings per share were EUR -0.25
(-0.23) and return on capital employed was 2.6 per cent (1.4).
The equity ratio was 32.7 per cent at the end of September and net
gearing ratio was 117 per cent (31 December 2006: 30.9% and 126%,
respectively).
Tissue and Cooking Papers
Tissue and Cooking Paper Industry's sales stood at EUR 632 million
(578), and operating profit was EUR 22 million (14). Comparable sales
were up approximately 4 per cent in January-September. The increase
in sales was attributable to an increase in the average selling
prices and revision of the product portfolio. The operating profit
includes EUR 2.5 million as a non-recurring cost related to the
closedown of the converting unit located on the Canary Islands by the
end of this year.
The increase in the price of pulp and recycled fibre caused an
additional cost of approximately EUR 10 million compared with the
corresponding period last year. Electricity and oil prices were also
higher than in the previous year. However, the improved sales of own
brands and price increases were sufficient to offset the impact of
higher raw material prices.
On the Nordic tissue paper market, the sales of Metsä Tissue's
own-label brands, Lambi and Serla, increased by over 10 per cent
compared with the corresponding period last year. The brands Katrin,
Mola and Tento also achieved good growth in Central Europe.
Events after the review period
M-real sold its Zanders Reflexin specialty paper mill in Germany to
Arjowiggins Group on 12 October 2007. M-real will book a loss of
approximately EUR 20 million from the transaction. This will not have
any material impact on M-real's operating profit excluding
non-recurring items. The transaction is expected to be completed by
the end of 2007 and it will be booked in the result for the last
quarter of the year. The transaction is subject to approval by the
competition authorities.
Risks and uncertainties
Since the forward-looking statements in this interim report are based
on current plans, estimates and projections, they involve risks and
uncertainties which may cause actual results to differ from those
expressed in such forward-looking statements. Information regarding
the risk factors is presented in the Metsäliitto Group's Annual
Report 2006.
Outlook
Demand for wood in Finland is good, particularly for pulpwood, and
the price level is at a record high. Due to the low stock levels and
the difficulties in Russian deliveries, the supply of wood to mills
requiring pulpwood will be challenging in the next quarter. Weather
conditions will have a strong impact on the success of this task.
In Wood Products Industry, increased stock levels of sawn timber
products will create price pressure at the end of the year. Higher
log prices will also have a negative impact on the fourth quarter
result. In other product groups, the prospects for the near future
are mainly positive.
The short-term outlook in the pulp market continues to be positive,
and the 2007 result is expected to remain almost at the same level as
last year. In 2008, the balance between supply and demand in pulp is
affected by new hardwood pulp production capacity entering the
market, as well as local shortages in raw material.
The demand for and price development of office paper and packaging
board is expected to remain good also during the last quarter of the
year. In magazine papers, the market situation should offer
opportunities for price increases around the turn of the year. Price
increases concerning coated fine papers are also tentatively planned
for the last quarter of the year.
Metsä Tissue's sales are expected to pick up slightly during the
final quarter of the year. On the other hand, higher raw material
costs will weaken profitability. A particular challenge for the
fourth quarter will be to ensure the availability of sufficient
amounts of recycled fibre in Central Europe.
Metsäliitto Group's 2007 operating profit excluding non-recurring
items is anticipated to improve from the previous year. Due to
increased wood raw material costs, weakened dollar and seasonal
factors, the operating profit for the last quarter is anticipated to
fall below third-quarter levels.
Espoo, 25 October 2007
Metsäliitto Group
Board of Directors
For further information, please contact:
Ilkka Pitkänen, Group CFO, Metsäliitto Group, tel. +358 10 469 4260
Lauri Peltola, Group CCO, Metsäliitto Group, tel. +358 50 570 5606
Unaudited
METSÄLIITTO GROUP
Income statement 2007 2006 2007 2006 2006
(EUR mill.) 1-9 1-9 Change Q3 Q3 1-12
Sales 6 604 6 919 -315 2 178 2 246 9 271
Other operating income 100 129 -29 37 40 175
Materials and services -4 331 -4 288 -43 -1 439 -1 390 -6 037
Employee costs -935 -1 081 146 -287 -337 -1 451
Other operating expenses -877 -1 164 287 -282 -365 -1 273
Depreciation and -358 -376 18 -109 -126 -707
impairment losses
Operating profit 203 139 64 98 68 -22
Share of results in 5 4 1 2 2 6
associates
Net exchange gains / -4 6 -10 -1 4 6
losses
Other financial income 24 17 7 -1 3 23
Other financial expenses -200 -168 -32 -63 -63 -235
Result before tax 28 -2 30 35 14 -222
Income taxes -65 -46 -19 -18 -21 -37
Result for the period -37 -48 11 17 -7 -259
Attributable to
Owners of parent company 50 27 23 21 13 -25
Minority interest -87 -75 -12 -4 -20 -234
-37 -48 11 17 -7 -259
Unaudited
2007 2006 2006
Balance sheet 30.9. 30.9. 31.12.
ASSETS
Non-current assets
Intangible assets 596 859 617
Tangible assets 4 104 4 208 4 197
Biological assets 80 51 71
Shares in associated and other companies 197 200 197
Interest-bearing receivables 39 54 52
Deferred tax receivables 77 82 77
Other non-interest-bearing receivables 3 8 13
5 096 5 463 5 225
Current assets
Inventories 1 247 1 140 1 095
Interest-bearing receivables 7 7 145
Non-interest-bearing receivables 1 661 1 672 1 617
Cash and cash equivalents 164 153 246
3 079 2 972 3 103
Assets classified as held for sale 33 376 103
TOTAL 8 208 8 811 8 431
MEMBERS' FUNDS AND LIABILITIES
Members' funds 1 315 1 343 1 289
Minority interest 960 1 269 1 064
Total members' funds 2 275 2 612 2 353
Non-current liabilities
Deferred tax liabilities 376 429 382
Retirement benefit obligations 229 249 238
Provisions 77 73 91
Other non-interest-bearing liabilities 65 75 56
Interest-bearing liabilities 3 313 3 256 3 455
4 060 4 082 4 222
Current liabilities
Non-interest-bearing liabilities 1 333 1 217 1 314
Interest-bearing liabilities 527 670 512
1 860 1 887 1 826
Total liabilities 5 920 5 970 6 048
Liabilities classified as held for sales 12 229 30
TOTAL 8 208 8 811 8 431
Unaudited
Fair
value Trans-
Change in Share and lation
members' Members' premium other differ- Retained Minority
funds capital reserve reserves ences earnings interest Total
(EUR mill.)
Members' 558 32 42 6 690 1 317 2 646
funds
1.1.2006
Translation -5 -5
differences
Dividends -37 -24 -61
paid
Increase in 20 7 27
members'
capital
Effects of 0
financial
instruments
Transfers 1 -3 2 0
between
items
Change in 54 54
minority
interest
Other 2 -3 -1
changes
Result for 27 -75 -48
the period
Members' 578 32 50 -2 684 1 269 2 612
funds
30.9.2006
Members' 577 30 48 6 628 1 064 2 353
funds
1.1.2007
Translation -7 -5 -12
differences
Dividends -33 -13 -46
paid
Increase in 16 16
members'
capital
Effects of 0
financial
instruments
Transfers 4 -4 0
between
items
Change in 4 4
minority
interest
Other -1 -3 -4
changes
Result for 50 -87 -37
the period
Members' 593 30 52 -1 641 960 2 275
funds
30.9.2007
Unaudited
Cash flow statement 2007 2006 2006
(EUR mill.) 1-9 1-9 1-12
Cash flow from operations
Result for the period -37 -48 -259
Adjustments total 565 520 898
Change in working capital -200 48 193
Cash generated from operations 328 520 833
Finance costs, net -174 -164 -189
Income taxes paid -60 -39 -54
Net cash from operations 94 317 590
Cash flow from investments
Acquisitions -10 -139 -136
Purchases of assets -308 -414 -608
Sold assets and others 93 54 69
Net cash from investments -224 -499 -675
Cash flow from financing
Increase in equity 21 97 98
Change in long-term loans and
other financial items 78 117 102
Dividends paid -51 -62 -62
Net cash flow from financing 48 152 138
Change in cash and cash equivalents -83 -30 53
Cash at beginning of period 246 194 194
Change in cash and cash equivalents -83 -30 53
Cash in assets classified as held for sale 1 -11 -1
Cash at end of period 164 153 246
Unaudited
BUSINESS SEGMENTS
Consumer Packaging I-III/07 I-III/06 QIII/07 QIII/06 I-IV/06
Sales 709 730 231 236 971
EBITDA 141 122 56 44 154
Depreciation & impairment -65 -68 -21 -23 -96
losses
Operating profit 76 54 35 21 58
Papers I-III/07 I-III/06 QIII/07 QIII/06 I-IV/06
Sales 2 251 2 340 740 767 3 118
EBITDA 164 151 82 70 172
Depreciation & impairment -170 -191 -53 -63 -388
losses
Operating profit -7 -40 29 7 -216
MAP Merchant Group I-III/07 I-III/06 QIII/07 QIII/06 I-IV/06
Sales 1 079 1 061 351 342 1 437
EBITDA 22 22 7 5 27
Depreciation & impairment -3 -5 -1 -2 -69
losses
Operating profit 19 17 6 3 -42
Wood Products I-III/07 I-III/06 QIII/07 QIII/06 I-IV/06
Sales 1 078 1 563 338 499 2 045
EBITDA 122 113 31 38 173
Depreciation & impairment -34 -52 -11 -17 -66
losses
Operating profit 88 61 20 21 107
EBITDA = Result before depreciation and impairment losses
Others I-III/07 I-III/06 QIII/07 QIII/06 I-IV/06
Operating profit 26 46 8 16 71
of which
Wood Supply 32 30 9 6 44
Tissue and Cooking 22 14 8 7 19
Papers
Others and Group -27 2 -10 3 8
eliminations
M-real includes 30% (2006: 39%) of the Pulp Industry's (Metsä-Botnia)
operating profit and Metsäliitto a further 23% (2006: 14 %) in the
segments Consumer Packaging and Papers.
Production
1 000 units I-III/07 I-III/06 QIII/07 QIII/06 I-IV/06
Paper, t 2 986 3 119 975 1 023 4 119
Paperboard, t 916 842 303 273 1 121
Sawn goods, m3 1 433 3 008 387 827 3 893
Processed timber, m3 469 911 134 282 1 179
Engineered Wood -products, 652 707 212 221 935
m3
Pulp & CTMP, t (M-real) 1 279 1 305 455 443 1 754
Pulp, t (Metsä-Botnia) 2 023 1 866 677 622 2 520
Unaudited
Quarterly data 2007 2007 2007 2006 2006 2006 2006
(EUR mill.) QIII QII QI QIV QIII QII QI
Sales
Consumer Packaging 231 242 236 241 236 237 257
Papers 740 732 779 778 767 772 801
MAP Merchant Group 351 349 379 376 342 354 365
Wood Products 338 386 354 482 499 555 510
Others & internal sales 518 473 496 475 402 396 425
Group sales 2 178 2 182 2 244 2 352 2 246 2 314 2 358
Operating profit
Consumer Packaging 35 12 29 5 21 5 27
Papers 29 -7 -29 -176 7 -64 17
MAP Merchant Group 6 6 7 -59 3 7 7
Wood Products 20 41 27 46 21 26 14
Others 8 18 1 24 16 14 17
Group operating profit 98 70 35 -160 68 -11 82
- % of sales 4.5 3.2 1.6 -6.8 3.0 -0.5 3.5
Share of results
in associates 2 1 2 2 2 2 0
Net exchange gains / -1 2 -5 0 4 -6 8
losses
Other fin. income & -64 -49 -62 -62 -60 -45 -45
expenses
Result before tax 35 24 -30 -220 14 -60 45
Income taxes -18 -29 -19 9 -21 -1 -24
Result for the period 17 -5 -49 -211 -7 -61 20
Unaudited
Change in tangible assets I-III/07 I-III/06 I-IV/06
Book value at beginning of period 4 197 4 256 4 256
Company acquisitions 3 82 92
Increase 299 494 693
Decrease -144 -241 -600
Depreciation and impairment charges -325 -367 -530
Assets classified as held for sale - - -28
Translation differences and other changes 74 -15 315
Book value at end of period 4 104 4 208 4 197
Commitments QIII/07 QIII/06 QIV/06
On own behalf (incl. leasing liabilities) 341 329 408
On behalf of associated companies 2 3 5
On behalf of others 2 19 3
Total 345 351 416
Commitments related to fixed assets QIII/07 QIII/06 QIV/06
Payments due under 1 year 61 171 195
Payments due in subsequent years 7 37 20
Open derivative contracts QIII/07 QIV/06
Interest rate derivatives 1 824 2 377
Currency derivatives 2 946 3 838
Other derivatives 204 173
Total 4 974 6 387
The market value of open derivative contracts at the end of the
review period was EUR 24 million (31.12.2005: EUR -4 million). Open
derivative contracts also include closed contracts to a total amount
of EUR 299 million (31.12.2006: EUR 871 million).
Accounting policies
The Interim Report was prepared in accordance with the IAS 34
standard Interim Financial Reporting and the accounting policies
presented in Metsäliitto Group's Annual Report 2006.
Taxes include taxes corresponding to the result for the period under
review.
New and changed standards
IFRS 7 Financial Instruments: Disclosures, and the complementary
Amendment to IAS 1, 'Presentation of Financial Statements - Capital
Disclosures', effective from 1 January 2007. The adoption of this new
standard will result in additional disclosures relating to financial
instruments but does not affect their classification or valuation.