A promising start of the year, supported by the profit
protection programme
HELSINKI, April 25, 2019 /PRNewswire/ -- Q1/2019
(compared with Q1/2018)
- Sales increased 2.2% to EUR 2 635 (2 579) million,
the highest first quarter since 2013 and the ninth consecutive
quarter of growth.
- Operational EBIT decreased to EUR
324 (369) million which was in the upper end of our guidance
range of EUR 260–350 million.
- The operational EBIT margin was 12.3% (14.3%), above 10% for
the seventh consecutive quarter.
- Operating profit (IFRS) was EUR
313 (355) million.
- EPS decreased by 16.0% to EUR
0.29 (0.35) and EPS excl. IAC was EUR
0.30 (0.35).
- Cash flow from operations decreased slightly to EUR
223 (229) million. Cash flow after investing activities
amounted to EUR 94 (113)
million.
- The net debt to operational EBITDA ratio increased to 1.7
(1.3), due to the adoption of IFRS 16 Leases (impact 0.3) and
dividend payment.
- Operational ROCE was 14.0% (17.7%), above the strategic target
of 13%.
Outlook for 2019
Stora Enso's year 2019 is
expected to be largely in line with 2018, provided that the current
trading conditions do not significantly change. Demand growth is
expected to continue for Stora Enso's other businesses except for
European Paper, for which demand is forecast to continue to decline
in 2019. Group's sales are expected to be higher and costs are
forecast to increase in 2019 compared to 2018. Stora Enso will
implement measures to mitigate these cost increases and the
increased uncertainties with the profit protection
programme.
Guidance for Q2/2019
Q2/2019 operational EBIT is
expected to be in the range of EUR 270–350 million. During the
second quarter, there will be annual maintenance shutdown at the
Nymölla paper mill. The total negative impact of maintenance is
estimated to be EUR 35 million less
compared to Q2/2018.
Key figures
EUR
million
|
Q1/19
|
Q1/18
|
Change %
Q1/19-Q1/18
|
Q4/18
|
Change %
Q1/19-Q4/18
|
2018
|
Sales
|
2 635
|
2 579
|
2.2%
|
2 657
|
-0.9%
|
10 486
|
Operational
EBITDA
|
471
|
504
|
-6.5%
|
405
|
16.3%
|
1 878
|
Operational
EBIT
|
324
|
369
|
-12.3%
|
271
|
19.5%
|
1 325
|
Operational EBIT
margin
|
12.3%
|
14.3%
|
|
10.2%
|
|
12.6%
|
Operating profit
(IFRS)
|
313
|
355
|
-11.9%
|
356
|
-12.1%
|
1 390
|
Profit before tax
excl. IAC
|
286
|
333
|
-14.2%
|
267
|
6.9%
|
1 190
|
Profit before tax
(IFRS)
|
282
|
333
|
-15.4%
|
315
|
-10.5%
|
1 210
|
Net profit for the
period (IFRS)
|
226
|
273
|
-17.4%
|
299
|
-24.4%
|
988
|
Net interest-bearing
liabilities
|
3 093
|
2 226
|
38.9%
|
2 092
|
47.8%
|
2 092
|
Operational
ROCE
|
14.0%
|
17.7%
|
|
12.4%
|
|
15.5%
|
Earnings per share
(EPS) excl. IAC, EUR
|
0.30
|
0.35
|
-14.9%
|
0.33
|
-8.3%
|
1.29
|
EPS (basic),
EUR
|
0.29
|
0.35
|
-16.0%
|
0.39
|
-23.6%
|
1.28
|
Net debt/last 12
months' operational EBITDA ratio
|
1.7
|
1.3
|
|
1.1
|
|
1.1
|
Average number of
employees
|
26 036
|
25 442
|
2.3%
|
26 151
|
-0.4%
|
26 067
|
Stora Enso's CEO Karl-Henrik Sundström comments on the first
quarter 2019 results:
"We have had a promising start of the year and I am pleased to
see that the profit protection programme is already supporting our
development. Given the potential market weakness, we are convinced
that the timing for activating the programme is right. During the
first quarter of 2019, we focused on the balance between value
creation and profit protection. It has obviously paid off. Sales
continue to grow and profitability is on a good level. The sales
increase of roughly 2% was primarily due to higher prices in all
divisions and improved product mix, despite lower volumes.
Operational EBIT decreased, while keeping a double-digit
operational margin for the seventh consecutive quarter. Operational
ROCE remains above our strategic target of 13%, despite additional
capital of nearly EUR 300 million due
to the implementation of IFRS 16.
Looking at our divisions, we had first quarter records in four out
of five: Packaging Solutions and Biomaterials had record sales,
while Wood Products and Paper delivered record profitability.
Moreover, it is satisfying that our price increases are coming
through gradually in Consumer Board.
We continue to drive our transformation projects forward and take
active steps to contribute to a renewable future. Our recent
investment in Hylte will enable manufacturing of formed fiber
products that are designed for circularity. These products are
renewable, recyclable, biodegradable and do not contain any
plastic. Also, the first commercial volumes were produced during
the quarter from our new cross laminated timber (CLT) investment at
Gruvön. Wooden elements store carbon dioxide and substitute fossil
based building materials, making them suitable for the development
of green and sustainable cities.
On the note of sustainability, I am pleased that we have
successfully issued our first Green Bonds to finance our ongoing
transaction in Bergvik Skog. The aim is to complete the transaction
during the second quarter of 2019. We have also completed our
feasibility study of the potential conversion of the Oulu paper
mill into packaging board production. The decision on the potential
conversion is planned to be made by the Board of Directors during
the first half of 2019 after the co-determination process has been
completed.
I find it is important to support initiatives that can help to
drive economics and society towards a plastic free future and we
have joined the New Plastics Economy Global Commitment to eliminate
plastic waste and pollution. This is led by the Ellen MacArthur
Foundation, in collaboration with UN Environment. We contribute
with our customers and suppliers by developing circular and low
carbon solutions to replace plastic.
All in all, we have made good progress in increasing our share of
the bioeconomy!
I am very proud that Stora Enso received the highest score in a
recent diversity report in Finland. We believe diversity strengthens
innovation and drives competitiveness, and we aim to reflect the
societies in which we operate.
As always, I would like to thank our customers for their business,
our employees for their dedication, and our investors for their
trust."
Events today
1) Press conference in Helsinki at
11.00 EEST
The webcast and press conference for media will
take place at 11.00 EEST (10.00 CEST, 09.00 UK time, 04.00 EDT) at
Stora Enso's Head Office, Kanavaranta 1, Helsinki. The event will be held in English
and it will be hosted by CEO Karl-Henrik Sundström, CFO
Seppo Parvi, and EVP, Communications
Ulrika Lilja. The webcast may be accessed at
https://storaenso.videosync.fi/2019-q1
2) Webcast and conference call for analysts and investors at
15.00 EEST
The webcast and conference call for
analysts and investors will take place at 15.00 EEST (14.00 CEST,
13.00 UK time, 08.00 EDT). It will be hosted by CEO Karl-Henrik
Sundström, CFO Seppo Parvi, and SVP,
Head of Investor Relations Ulla Paajanen, and may be accessed at
https://edge.media-server.com/m6/p/h9z3yw5c.
Those analysts and investors who wish to ask questions should join
the conference call (details below). All participants can follow
the presentation over the webcast.
Live event at 15.00
EEST
UK +44
(0)2071-928-000
Finland +358
(0)9-4245-0806
Sweden
+46
(0)8-5069-2180
USA +1-631-510-7495
Confirmation
code:
7742658
The links to the webcasts are also available on the Stora
Enso website: storaenso.com/investors.
This release is a summary of Stora Enso's Interim Report
January–March 2019. The complete report is attached to this release
as a pdf file. It is also available on the company website at
storaenso.com/investors.
Part of the bioeconomy, Stora Enso is a leading global
provider of renewable solutions in packaging, biomaterials, wooden
constructions and paper. We believe that everything that is made
from fossil-based materials today can be made from a tree tomorrow.
Stora Enso has some 26 000 employees in over 30 countries. Our
sales in 2018 were EUR 10.5 billion.
Stora Enso shares are listed on Nasdaq Helsinki (STEAV, STERV) and
Nasdaq Stockholm (STE A, STE R). In addition, the shares are traded
in the USA as ADRs (SEOAY).
storaenso.com
For further information, please contact:
Ulrika Lilja
EVP, Communications
tel. +46-72-221-9228
Investor enquiries:
Ulla Paajanen
SVP, Investor Relations
tel. +358-40-763-8767
This information was brought to you by Cision
http://news.cision.com
https://news.cision.com/stora-enso-oyj/r/stora-enso-oyj-interim-report-january-march-2019,c2796252
The following files are available for download:
https://mb.cision.com/Public/13589/2796252/ac7fc47a00ab3365.pdf
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