ESPOO, Finland , July 31, 2014 (Press Release) -
Result for the first half of 2014
Sales were EUR 995.2 million (Q1-Q2/2013: 1,037.8). Operating result excluding non-recurring items was EUR 64.4 million (56.2). Operating result including non-recurring items was EUR 75.7 million (63.7). Result before taxes excluding non-recurring items was EUR 40.8 million (22.4). Result before taxes including non-recurring items was EUR 49.9 million (29.8). Earnings per share excluding non-recurring items were EUR 0.10 (0.06). Earnings per share including non-recurring items were EUR 0.13 (0.08).Result for the second quarter of 2014
Sales were EUR 494.0 million (Q1/2014: 501.2). Operating result excluding non-recurring items was EUR 28.3 million (36.1). Operating result including non-recurring items was EUR 32.2 million (43.5). Result before taxes excluding non-recurring items was EUR 20.0 million (20.8). Result before taxes including non-recurring items was EUR 23.9 million (26.0). Earnings per share excluding non-recurring items were EUR 0.04 (0.06). Earnings per share including non-recurring items were EUR 0.05 (0.08).Events during the second quarter of 2014
Paperboard delivery volume increased compared to the previous quarter. Paper delivery volume decreased. Average market price levels for Metsä Board's main products remained unchanged. Cash flow improved mainly due to reduced working capital, and net debt decreased considerably. Mika Joukio was appointed as the new CEO of Metsä Board as of 1 December 2014 at the latest, when Mikko Helander, the current CEO, will leave Metsä Board."Our paperboard deliveries continued to grow as planned in the second quarter, increasing by 7 per cent compared to the corresponding period last year. In line with our goals, North America recorded the highest growth rate. The sales volumes of our fresh forest fibre linerboard have increased steadily in North America, and our lightweight folding boxboards have been very well received.
In the second quarter, the result was burdened by scheduled maintenance shutdowns at the Husum integrated paper and pulp mill and Metsä Fibre's Joutseno and Äänekoski mills, which were implemented successfully. Overall profitability in the second quarter was in line with our expectations, and our net debt decreased to EUR 540 million at the end of the second quarter thanks to our strong cash flow.
We successfully launched several new products: Carta Dedica, a lightweight board developed for food service and cup stock; Carta Allura for luxury packaging; and Modo Northern Light Coated, the newest linerboard product from Husum. These new products are excellent complements to Metsä Board's existing product range.
Our paperboard order inflows have continued to strengthen recently, and we believe our paperboard deliveries will continue to increase in the third quarter."
Mikko Helander, CEO
The divestment of the holding in Metsä Group Treasury Oy in September 2013 improved Metsä Board's equity ratio by approximately 5 percentage points and return on capital employed by almost 1 percentage point and reduced the company's gross debt by more than EUR 300 million, compared to the actual figures for the second quarter of 2013.
Business environment and near-term outlook
Compared to the second quarter, the delivery volumes of folding boxboard and white-top fresh forest fibre linerboard are estimated to increase slightly in the third quarter of 2014. No material price changes are in sight at the moment.
The delivery volumes of uncoated fine paper, coated papers and market pulp in the third quarter of 2014 are expected to remain at approximately the same level as in the previous quarter. No material changes in the price of paper are in sight. The average price of Metsä Board's market pulp deliveries is also expected to be stable over the next few months.
The annual maintenance shutdown at the Kemi integrated mill will have some negative impact in the third quarter of 2014.
Production costs in the third quarter of 2014 are expected to be approximately at the same level as in the previous quarter.
Metsä Board's operating result, excluding non-recurring items is in the third quarter of 2014 expected to improve slightly from the second quarter of 2014.
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-June 2014 enclosed to this stock exchange release.
[For the full report and financial tables, click here.]
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