BillerudKorsnäs has published its interim report January-June 2014.Net sales increased with 2% and adjusted operating profit increased with 44% compared to the second quarter 2013. Improvements were due to improved product mix and volumes, as well as more favourable exchange rates and synergies.
Compared to the previous quarter net sales and adjusted operating profit decreased due to periodic maintenance shutdowns.
During the quarter the group has restructured the debt portfolio securing a healthy debt profile with improved margins.
Demand and order situation is expected to remain stable during the third quarter 2014 for all business areas.
Average prices in local currency are anticipated to stay on current level for the third quarter 2014 for business areas Packaging Paper and Consumer Board. Meanwhile the increased gap between recovered fibre and primary fibre grades is leading to an increased pressure on primary fibre based prices within the business area Containerboard. Due to increased production capacity in Sweden from converted fine paper machines especially white kraftliner prices are facing decreases.
Wood prices are expected to stay on current level for the second half of 2014.
The target of approximately SEK 530 million in annual synergies and savings is unchanged, and is expected to be reached during 2014. Estimated non-recurring costs for realising the synergies are increased from approximately SEK 200 million to approximately SEK 225 million.
BillerudKorsnäs’ CEO Per Lindberg comments on the report:
“We deliver a strong and stable result for the second quarter. Our adjusted operating profit reached SEK 467 million and our operating margin was 9%. Overall, I am pleased with our financial performance. The market place has been quite good with solid demand and stable prices within all business areas. Business area Packaging Paper has managed to keep the prices stable during the quarter in spite of increased capacity on the market, and has increased prices on new orders within the sack segments thanks to a seasonally strong demand. Within business area Consumer Board we have launched the next generation of Cartonboard products on the market, which has been very well received by customers. Business area Containerboard has delivered a stable result for the second quarter but is beginning to feel a real pressure from the increased capacity on the market.
