Interim report January-June 2010
Submitted for publication at 10.30 CET on 22 July 2010
(Tables included in attached PDF)
January-June 2010 compared with the same period in 2009
- Net sales amounted to SEK 4 298 million (3 807), an increase of 13%.
- Profit for the period amounted to SEK 290 million (-31).
- Earnings per share amounted to SEK 2,82 (-0,42).
- Operating profit amounted to SEK 435 million (5), corresponding to a margin of 10% (0).
- The 2010 Annual General Meeting resolved in accordance with the Board’s proposal to issue a dividend of SEK 0,50 (0) per share for 2009.
April-June 2010 compared with January-March 2010
- Net sales amounted to SEK 2 108 million (2 190).
- Profit for the period amounted to SEK 134 million (156).
- Operating profit amounted to SEK 201 million (234), a decrease of SEK 33 million.
- The second quarter of 2010 was charged with costs of approximately SEK 110 million for a periodic maintenance shutdown at Gruvön mill. The maintenance shutdown, which takes place at 18-month intervals, was more expensive and more complicated than anticipated due, among other things, to strike action.
- Strike action during the second quarter led to a loss of production of approximately 26 000 tonnes as well as extraordinary costs. Together these amounted to SEK 77 million. The Confederation of Swedish Enterprise has for strike-related costs offered full compensation. The expected compensation has been recognised as income during the second quarter.
- The strong order bookings continued in the second quarter. The packaging paper segment increased prices in local currency by an average of approximately 6% compared with the first quarter.
- A new 7-year credit facility for SEK 800 million was raised after the end of the quarter.
Outlook for the full-year 2010
- The third quarter of 2010 started with continued good demand within all segments.
- Price increases have been implemented for all products and additional increases have been announced in order to gradually restore prices to levels prevailing end of 2008.
- Strike action in the second quarter will result in lower total deliveries for the full year.
Comments by Billerud’s CEO Per Lindberg:
Continued very strong demand and increasing prices, but extraordinary costs affect margins
“With an operating profit of SEK 201 million for the second quarter of 2010 we now have three consecutive quarters behind us with an operating margin of 10%. We have continued our efforts to restore prices in local currency and prices for our packaging paper during the quarter were on average approximately 6% higher than in the previous quarter in each sales currency. This work is being given priority since part of these increases is needed to counteract a strengthened Swedish krona.
During the second quarter a planned maintenance shutdown at our largest mill was carried out and this shutdown had a substantial effect on profitability. The shutdown takes place every 18 months and latest occurred during the fourth quarter of 2008. The shutdown was complicated by strike action and was more expensive than anticipated. The cost of the shutdown was approximately SEK 110 million and was reflected in lower production volumes as well as higher variable and fixed costs. This means that at first glance the comparison between the first and second quarter of this year may appear negative for our packaging segments, in particular for Packaging Boards which had to bear most of the shutdown costs. This does not apply to the Market Pulp business area which as a result of price increases for pulp and despite the shutdown costs can deliver historically very good margins. Market Pulp business area has to a lesser extent been affected by shutdown costs.
We view this quarter, however, as a step forward for Billerud. We have very strong demand for all products and we continue to raise prices. We are also particularly pleased about the recognition our new product FibreForm® received in China where we received the “Technology Innovation Award 2010.”
Billerud’s CEO Per Lindberg and CFO Bertil Carlsén will present the interim report at a press and analysts conference on Thursday, 22 July at 13.00 CET.
Venue: Spårvagnshallarna, Birger Jarlsgatan 57 A, Stockholm.
For further information in connection with this report, please contact Per Lindberg, President and CEO, +46 70 248 15 17 and Bertil Carlsén, CFO, +46 730 211 092
This information is such that Billerud AB is required to disclose under the Securities Market Act. This report has been prepared in both a Swedish and an English version. In the event of variations between the two, the Swedish version shall take precedence.
Billerud is a packaging paper company. The business concept is to offer customers packaging material and solutions that promote and protect their products – packaging that is attractive, strong and made of renewable material. Billerud has a world-leading position within several product segments, both within paper for consumer packaging and for industrial applications. Production takes place at the Group’s three integrated pulp and paper mills in Sweden, and at a paper mill in the UK. www.billerud.com