Metsä Group Interim Report Q3/2016

Transcription

1 Metsä Group Interim Report Q3/2016 Kari Jordan President and CEO

2 Metsä Group Q3 Business developed as expected Sales EUR 3,483 million (1 9/2016: EUR 3,811 million) Comparable operating result EUR 332 million (EUR 415 million), or 9.5% of sales (10.9%) Comparable return on capital employed 10.5% (14.2%) Comparable operating result compared to previous year was affected by lower market price and sales volume of pulp as well as the start-up phase of the new folding boxboard production line at Metsä Board s Husum mill 2

3 Metsä Group Q3 Events in the third quarter Supply of wood was steady and stumpage prices remained stable Market price of long-fibre pulp increased by 2 per cent and the price of short-fibre pulp fell by 3 per cent from previous quarter Delivery volumes of Kerto LVL continued to grow strongly in Australia and North America Market situation and price levels of paperboard remained stable Metsä Wood s EUR 100 million investment programme in plywood and Kerto LVL products progressed as planned Kyro mill s wallpaper base machine was closed down in September Finnish sawmills were transferred to Metsä Fibre on 1 Nov Construction of bioproduct mill in Äänekoski progressed as planned Nearly 75 per cent of the project was ready at the end of September Workforce per day nearly 2,000 people 3

4 Metsä Group Q3 Sales quarterly EUR million Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 4

5 Metsä Group Q3 Operating result EUR million Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Comparable operating result Operating result (IFRS) 5

6 Metsä Group Q3 Comparable operating result EUR million Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16

7 Metsä Group Q3 Change in comparable operating result EUR million Comparable operating result 1 9/ Sales prices -200 Sales volumes -17 Exchange rates 14 Raw materials 29 Employee costs 26 Depreciation and others 20 Change of inventories Comparable operating result 1 9/

8 Metsä Group Q3 Items affecting comparability Q1 Q3/2016 EUR million Q1 Q3/2016 Operating result (IFRS) Items affecting comparability: Metsä Wood / Additional expenses related to divestment of Metsä Wood France S.A.S Metsä Board / Restructuring of Simpele paperboard mill -1.8 Metsä Board / Loss related to divestment of Alrec Boiler Oy -1.1 Metsä Board / Organisation of Benelux sales office -0.7 Metsä Board / Items related to paper production at Kyro -9.2 Metsä Fibre / Sales profit related to Metsä-Botnia Metsät Oy 11.7 Metsä Tissue / Cancellation of the restructuring provision 2.0 Items affecting comparability total 0.5 Comparable operating result

9 Metsä Group Q3 Comparable ROCE % Target >10% Q1 Q3/2012 Q1 Q3/2013 Q1 Q3/2014 Q1 Q3/2015 Q1 Q3/2016 9

10 Metsä Group Q3 Equity ratio % / / / /2015 9/

11 Metsä Group Q3 Interest-bearing net liabilities EUR million / / / /2015 9/

12 Metsä Group Q3 Capital expenditure EUR million Full-year estimate 1 12/ / / / /

13 Metsä Group Q3 Income statement EUR million Q1 Q3/2016 Q1 Q3/2015 Change Sales Other operating income Operating expenses Depreciation and impairment losses Operating result Comparable operating result Share of results from associated companies and joint ventures Exchange gains and losses Other net financial items Result before taxes

14 Metsä Group Q3 Key figures Q1 Q3/2016 Q1 Q3/2015 Change Return on capital employed, % Comparable return on capital employed Return on equity, % Comparable return on equity Equity ratio, % Net gearing ratio, % Interest-bearing net liabilities, EUR million Capital expenditure, EUR million Personnel at end of period

15 Metsä Group Q3 Cash Flow Statement I EUR million Q1 Q3/2016 Q1 Q3/2015 Cash flow from operating activities Result for the period Adjustments to result for the period Interest received Interest paid Dividends received Taxes Other financial items, net Change in working capital Net cash flow from operating activities

16 Metsä Group Q3 Cash Flow Statement II EUR million Q1 Q3/2016 Q1 Q3/2015 Net cash flow from operating activities Purchase of shares Investments Sales of assets and others Changes in members' capital and other capital Interest on members' capital and dividends paid Change in long-term loans and committed facilities Change in cash and cash equivalents Cash and cash equivalents at beginning of the period Translation differences and others Change in cash and cash equivalents Cash and cash equivalents at end of the period

17 Metsä Group Q3 Personnel / / / /2015 9/

18 Wood Supply and Forest Services

19 Metsä Forest Wood Supply and Forest Services Wood Supply and Forest Services EUR million Q1 Q3/2016 Q1 Q3/2015 Change Sales Other operating income Operating expenses Depreciation and impairment losses Operating result Items affecting comparability, total Comparable operating result, EUR million % of sales

20 Metsä Forest Wood Supply and Forest Services Popularity of electronic services increases Supply of wood was steady and stumpage prices remained stable Metsä Forest delivered a total of 22.7 million cubic metres of wood (22.8) Wood was harvested as targeted and deliveries to customers' production units were carried out as planned Sales of forest management services continued at a good level Nearly 20% of wood acquired from private forests was purchased electronically Nearly 25% of forest management services was sold electronically Comparable operating result EUR million Q1/ Q2/ Q3/ Q4/ Q1/ Q2/15 Q3/ Q4/ Q1/ Q2/ Q3/16 Q4/16 20

21 Wood Products Industry

22 Metsä Wood Wood Products Industry Wood Products Industry EUR million Q1 Q3/2016 Q1 Q3/2015 Change Sales Other operating income Operating expenses Depreciation and impairment losses Operating result Items affecting comparability, total Comparable operating result, EUR million % of sales

23 Metsä Wood Wood Products Industry Growth in delivery volumes of Kerto LVL products Delivery volumes of Kerto LVL continued to grow strongly in Australia and North America. Demand was strong in other markets too Profitability of sawing operations was weaker than in comparison period due to declined prices Deliveries of sawn pine timber remained clearly below the deliveries of the comparison period. Delivery volumes and sales in plywood products decreased Investment programme of EUR 100 million related to the Kerto LVL and plywood operations announced in June progressed as planned At the beginning of November Metsä Wood's sawmills in Finland transferred to Metsä Fibre Comparable operating result EUR million Q1/ Q2/ Q3/ Q4/14 Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ Q3/16 Q4/16 23

24 Pulp Industry

25 Metsä Fibre Pulp Industry Pulp Industry EUR million Q1 Q3/2016 Q1 Q3/2015 Change Sales Other operating income Operating expenses Depreciation and impairment losses Operating result Items affecting comparability, total Comparable operating result, EUR million % of sales

26 Metsä Fibre Pulp Industry Price of pulp (PIX) 2008 Q3/2016 USD ' Hardwood/EUR Softwood/EUR Hardwood/USD Softwood/USD Source: FOEX Indexes Ltd EUR 26 Metsä Group

27 Metsä Fibre Pulp Industry Currency-denominated market prices of pulp on a lower level than previous year Currency-denominated market prices of longfibre pulp were 8% and of short-fibre pulp 9% lower than in corresponding period previous year Price of long-fibre pulp in Europe was USD 794 per tonne at the beginning of January and USD 810 at end of review period Price of short-fibre pulp was USD 781 and USD 664 respectively Metsä Group s sawmills in Finland transferred to Metsä Fibre on 1 November to utilise the industrial synergies even better Construction of bioproduct mill in Äänekoski progresses as planned Comparable operating result EUR million Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ Q3/ Q4/ Q1/ Q2/16 Q3/16 Q4/16 27 Metsä Group

28 Paperboard Industry

29 Metsä Board Paperboard Industry Paperboard Industry EUR million Q1 Q3/2016 Q1 Q3/2015 Change Sales Other operating income Operating expenses Depreciation and impairment losses Operating result Items affecting comparability, total Comparable operating result, EUR million % of sales

30 Metsä Board Paperboard Industry Prices of folding boxboard and white-top krafliner in Europe 2010 Q3/2016 EUR/tonne Folding boxboard White-top kraftliner Sources: Pöyry Management Consulting and FOEX Indexes Ltd.

31 Metsä Board Paperboard Industry Result development affected by start-up of Husum s new folding boxboard production line Total delivery volume of folding boxboard and white fresh fibre linerboard increased 13% compared to corresponding period previous year Sales were reduced due to the planned major decrease in paper deliveries Operating result was weakened by start-up of Husum s new paperboard production line which affected production volumes of pulp and paperboard and lower average price of start-up volumes as well as fluctuations in pulp prices Wallpaper base machine at Kyro mill was closed down in September Comparable operating result EUR million 60,0 50,0 40,0 30,0 20,0 10,0 0, Q1/ Q2/ Q3/14 Q4/ Q1/ Q2/ Q3/ Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 31

32 Tissue and Cooking Papers

33 Metsä Tissue Tissue and Cooking Papers Tissue and Cooking Papers EUR million Q1 Q3/2016 Q1 Q3/2015 Change Sales Other operating income Operating expenses Depreciation and impairment losses Operating result Items affecting comparability, total Comparable operating result, EUR million % of sales

34 Metsä Tissue Tissue and Cooking Papers Improved sales mix and lower costs increased operating result from previous year Sales mix improved and costs of energy and logistics were lower than in previous year Sales were reduced primarily by lower sales volumes as a result of discontinuation of the tissue paper operations in Russia. Also the exchange rate changes reduced sales During the third quarter, a greaseproof paper machine in Mänttä was renewed SAGA Baking Form, containing no plastic or aluminum, made from corrugated board and baking paper to the Finnish market Comparable operating result EUR million 25,0 20,0 15,0 10,0 5, ,0 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 34

35 Summary

36 Metsä Group Q Summary Outlook for the business areas 1/2 Wood Supply and Forest Services Wood demand will focus primarily on spruce logs, thinning sites to be harvested when the ground is unfrozen and, in energy wood, on crown wood Uncertainties related to Act on the Financing of Sustainable Forestry will have a negative impact on demand for forest management services Wood Products Industry Competition is intensifying as a result of new investments In sawn timber, demand in Asia will support the market balance of spruce sawn timber. In pine sawn timber the oversupply will continue Demand for board products is expected to experience slight seasonal weakening. Construction in the UK is expected to remain at a good level Pulp No signs of considerable changes in market conditions. New capacity will enter the markets, but global demand for pulp is expected to continue to growing. The capacity utilization rates of Metsä Fibre's pulp mills are expected to be at a good level in the last quarter of the year 36

37 Metsä Group Q Summary Outlook for the business areas 2/2 Paperboard Demand for high-quality fresh fibre paperboards is expected to remain good in both Europe and the Americas. Metsä Board's paperboard deliveries in October December are expected to remained at the same level as in the previous quarter Market prices of folding boxboard and fresh fibre white linerboards are expected to remain stable or increase slightly Metsä Board's fourth-quarter result will be weakened by the annual maintenance shutdown at the Husum integrated mill Tissue and Cooking Papers Demand is expected to remain stable in all tissue and cooking paper market areas Demand for tissue paper is expected to increase particularly in eastern Central Europe, and demand for cooking papers is expected to grow in Asia 37

38 Summary Near-term outlook Metsä Group s comparable operating result is in the last quarter of 2016 expected to be roughly at a similar level as in the third quarter of

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