Stora Enso’s 4Q 2020 sales decreased by 11%, or Euro 257 million from the previous year to Euro 2 154 million. Sales were negatively affected by mix and lower prices especially in the Paper and Forest divisions. Lower by-product sales decreased the top line further. Deliveries were clearly lower in Paper, as the global overcapacity and Covid-19 pandemic reduced demand. The divestment and closures of paper production at Oulu Mill in Finland, the Kitee and Pfarrkirchen sawmills in Finland and Germany, as well as a small packaging paper machine closure at Imatra Mills in Finland reduced sales.
4Q 2020 operational EBIT decreased by 5%, or Euro 6 million, from the previous year to Euro 118 million. The operational EBIT margin increased to 5.5%.
FY 2020 sales, at Euro 8 553 million, were 14.9% lower than a year earlier. Deliveries reduced in all divisions and the largest drop was in paper volumes. Sales prices were lower in all divisions, with the biggest negative price impacts coming from pulp and paper. The impact of the foreign exchange rate movements on sales was Euro 19 million positive.
FY 2020 operational EBIT, at Euro 650 million, decreased by 35.2%, or Euro 353 million and represents a margin of 7.6%. Operational EBIT decreased due to lower sales prices and lower volumes in all divisions. The biggest negative impact came from the lower paper volumes and prices and the significantly lower pulp prices.
Variable costs were Euro 340 million lower, mainly fiber costs including wood, pulp and recycled paper. Fixed costs decreased by Euro 117 million due to Covid-19 and profit protection programme actions. The net foreign exchange impact increased operational EBIT by Euro 123 million. The operational result from equity accounted investments was Euro 16 million lower, mainly due to the Bergvik Skog transaction in 2019.
Stora Enso’s President and CEO Annica Bresky said: “Looking back at 2020, my first year as CEO for Stora Enso, I can undoubtedly say that it has been extremely eventful. The year has been marked by the global pandemic and slowdown of the global economy, but also by geopolitical unrest, Brexit and – for Stora Enso during the 1Q – the strikes in Finland. So, concluding with the 4Q, in an environment that is still volatile, I am very satisfied that we deliver steady results in line with 4Q 2019. If we exclude Paper, operational EBIT increased to Euro 122 million. Sequentially quarter on quarter, we can see improved sales, an indication that the markets are moving in the right direction. We are delivering on our Euro 400 million savings promise and we have further reduced working capital to record low levels, enhancing our cash flow.”