Interim report January-March 2012
Submitted for publication at 07.45 CET on 26 April 2012
(Tables included in attached PDF)
First quarter 2012
- Net sales amounted to SEK 2 291 million, compared with SEK 2 086 million in the previous quarter.
- Operating profit totalled SEK 142 million, up SEK 67 million on the previous quarter. The increase arises mainly from the absence of maintenance or market-related production shutdowns, leading to higher volumes and lower fixed costs.
- Results for the quarter were charged with acquisition-related non-recurring costs of SEK 14 million. Adjusted for these non-recurring costs, operating profit totalled SEK 156 million.
- Prices in local currency for packaging paper fell by around 2% compared with the previous quarter, as a result of the price cuts made during the previous quarter.
- The market shows signs of an upturn during the second quarter.
- The order situation in the packaging paper segments improved in the first quarter, compared to the previous one, and had at the beginning of the second quarter on average returned to normal levels. It is anticipated that the order situation will remain good in the next quarter.
- Price cuts in the packaging paper segments halted during the quarter.
- Price rises have during the quarter been announced in certain product categories and a price increase of 8-10% for sack and kraft paper was announced after the end of the quarter, to take effect on 1 June 2012.
- Acquisition-related non-recurring costs will be charged to results in the quarter in which the acquisition of UPM-Kymmene’s packaging paper business will be completed. These costs are estimated to an additional approximately SEK 15 million. Added to this figure will be non-recurring costs, already disclosed, estimated at approximately SEK 22 million to separate off the business acquired. The costs will accrue over the three remaining quarters of the year.
- Wood prices are anticipated to be lower in 2012 than in 2011.
Comments by Billerud’s CEO Per Lindberg:
Upturn in market with positive outlook
“The order situation has improved in our packaging paper segments and is now at a normal level. However, our sales of SEK 2 291 million and operating margin of 6% reflect a low level of prices. In local currency, prices for packaging paper fell by around 2% in the first quarter, as a result of pressure on prices during the previous quarter. We are today announcing an increase of EUR 80 per tonne in the prices of our sack and kraft paper, with effect from 1 June.
As we disclosed earlier, we reached agreement with UPM-Kymmene on 1 February concerning the acquisition of its packaging paper operations in Pietarsaari and Tervasaari, at a cost of EUR 130 million. The acquisition will complement our current product offering and enable us to develop and strengthen our offering in renewable, smarter packaging. Through the acquisition, we will also reduce our pulp exposure, in turn bringing down the volatility in our results. It also enables us to expand our EUR cost base. We are anticipating net annual synergies amounting to SEK 30 million, and that earnings per share will rise once the effects of the synergies are achieved. It is anticipated that the take-over of the acquired business will be completed in the second quarter.”
Billerud’s President and CEO Per Lindberg and CFO Susanne Lithander will present the interim report at a press and analyst conference at 13.30 CET on Thursday, 26 April.
Venue: Tändstickspalatset, Västra Trädgårdsgatan 15, Stockholm.
For further information in connection with this report, please contact Per Lindberg, President and CEO, +46 702 481 517 and Susanne Lithander, CFO, +46 730 370 874.
This information is such that Billerud Aktiebolag (publ) is required to disclose under the Securities Market Act. Submitted for publication at 07.45 CET on 26 April 2012. 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. The report has not been reviewed by the company’s auditors.
Billerud – “The Natural Part in Smarter Packaging”. Packaging manufacturers and brand owners are offered added value in the form of brand-strengthening, productivity-boosting and environment-enhancing packaging solutions. Billerud has a world-leading market position within primary fibre-based packaging paper. Billerud has annual sales of around SEK 9 000 million and is listed on NASDAQ OMX Stockholm. www.billerud.com