The pandemic puts pressure on the market, stable production in
·
THE
· NET TURNOVER decreased by 12 % to 510 (582) MSEK in line with the decreasing market prices.
· EBIT for the second quarter 2020 was 2 (103) MSEK. The result was strongly influenced by developments in the pulp market.
· THE PLANNED MAINTENANCE SHUTDOWN at
· PROFIT AFTER FINANCIAL ITEMS the second quarter was -3 (98) MSEK. Earnings per share for the quarter was -0,02
· A STRONG BALANCE SHEET in uncertain times. The equity/assets ratio is 56 (60) %. Available liquidity amounts to 505 (519) MSEK.
· THE PRODUCTION VOLUME was impacted by the maintenance shutdown at
· THE ANNUAL GENERAL MEETING was held on
· THE CORONA PANDEMIC has not had a negative effect on
COMMENTS FROM THE CEO
The effects and challenges of the corona pandemic weighed on our market and operations during the quarter. The underlying production rate was stable, adjusted for the maintenance shutdown at
The consequences of the corona pandemic continued to affect our operations during the second quarter. As always, the health of our employees comes first, and we have worked systematically to avoid the spread of infection among our staff and in our workplaces. The pandemic had no major impact on our operations during the quarter in terms of sick leave, but it affects the working environment and the possibilities to meet customers, both existing and new ones.
Net sales decreased by 12 per cent during the second quarter compared with the corresponding period last year. At the same time, the EBIT result decreased by just over 100 MSEK to 2 MSEK. The decline was mainly explained by lower sales prices due to the deteriorating market, but also by the annual maintenance shutdown at
THE PANDEMIC SQUEEZED THE MARKET AND INCREASED VOLATILITY
The pulp market is under continued pressure due to the pandemic's far-reaching consequences on the global economy, and the negative development is likely to continue during the second half of the year.
Overall, supply during the second quarter was greater than demand. To match production volumes, we have sold a larger share on shorter contracts and as a consequence margins and profitability have decreased. However, the list price for NBSK rose during the quarter from
Consumption of printing and writing paper has declined and forecasts indicate that demand will decrease by more than 20 per cent for the full year. At the same time other important segments grew, mainly pulp for tissue. Manufacturers of filters and packaging are also showing healthy demand.
The supply of pulp wood remained good during the quarter. The supply balance between local wood and imports was at a normal and favorable level. A lower production rate in the pulp and paper industry at the same time as the bark beetle problem continues to push the supply of damaged timber benefits the balance in the market and means that prices fall.
When it comes to our large purchases of electricity in
ORGANIZATION: KEY APPOINTMENTS IN PLACE
During the quarter, several key appointments within our organization and group management were finalized. The recruitment of a new purchasing director, Arvid Svanborg, means that we have secured the succession in the best possible way after
Since 1st of
SYSTEMATIC WORK WITH CONTINUOUS IMPROVEMENTS
In parallel with dealing with the challenges of the corona pandemic, we place great focus on our long-term plan, to increase production through continuous improvements of our processes and routines. The medium-term goal is to reach the Group's production capacity, 440 thousand tons. This corresponds to an increase of 5 per cent from the current level.
Our strong balance sheet with significant liquidity makes us well prepared for the uncertainty that prevails in the pulp market. The equity/assets ratio at the end of the second quarter was 56 per cent. At the same time, the Group's cash and cash equivalents amounted to 323 MSEK and unutilized credits to 182 MSEK. The interest-bearing net debt was 88 MSEK.
In the current turbulent times, it is very satisfying to have a strong organization with highly motivated employees who handle the new circumstances with a systematic approach.
I would like to thank all colleagues for their wholehearted efforts to take the Group to the next level and for standing up to the great challenges we face. We try to keep the corona effects as far away from the business as possible through our measures and focus on the systematic work to develop
To conclude, I would like to thank both customers and suppliers for working together with us to manage the corona situation in the best possible way and thus keeping the business going.
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(For full report, see attached pdf)
This information is such information that
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https://mb.cision.com/Main/15260/3158329/1282531.pdf
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