metsä board's 1q 2014 interim report presentation
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Metsä Board's 1Q 2014 interim report presentationTRANSCRIPT
Metsä Board
Metsä BoardResults 1Q 2014
Metsä Board
Key Events in 1Q 2014
‒ Profitability improved from previous quarter
‒ Folding boxboard delivery volumes increased in Europe and outside Europe. Strongest growth was seen in North America
‒ Folding boxboard European contract prices increased and price increases for fresh forest fibre linerboard and uncoated fine paper were announced
‒ New folding boxboards and linerboards were introduced to the market
‒ Lielahti real estate was sold for EUR 26 million. EUR 19.7 million was paid for UPM based on the Court of Arbitration’s judgment
‒ Successful refinancing including a 5 year EUR 225 million bond with an interest rate of 4.000 per cent
2
Metsä Board
3019
29
6
2520
24 2636
0
10
20
30
40
50
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14
545 522 532 509 535 503 479502 501
0
200
400
600
800
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14
-9
1710 9
199
184
21
-10
0
10
20
30
40
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14
Sales, m€ Operating result excl. non-rec. items, m€
Result before taxes excl. non-rec. items, m€
Operating Result in 1Q 2014 Improved as Expected Mainly Due to Increased Deliveries
3
1Q 2014 net financing costswere increased by about6 m€ due to one time costsrelated to refinancing
Metsä Board
‒ Result was improved mainly by higher folding boxboard delivery volumes
‒ Folding boxboard contract prices increased in Europe. Average sales prices remained stable due to sales mix
‒ Folding boxboard deliveries are expected to slightly increase in 2Q 2014
‒ Product inventories have been increased to accelerate growth outside Europe
‒ New folding boxboards Carta Dedica for cups and plates and Carta Allurafor luxury packaging were introduced
4
EBIT, excl. non-recurring items
Sales
Cartonboard’s 1Q 2014 Operating Result Clearly Better than in the Previous Quarter
m€
m€
1820
15 15
10
0
6
12
18
24
30
1Q13 2Q13 3Q13 4Q13 1Q14
214208220218222
0
50
100
150
200
250
1Q13 2Q13 3Q13 4Q13 1Q14
Metsä Board
Linerboard and Paper’s Profitability Continued at Good Level in 1Q 2014
‒ Fresh forest fibre linerboard deliveries increased from previous quarter and prices were stable
‒ Uncoated fine and coated paper delivery volumes decreased. Uncoated fine paper price increased slightly and coated paper prices remained stable
‒ Market pulp delivery volumes increased and prices were stable in 1Q 2014
‒ Fresh forest fibre linerboard, coated paper and market pulp deliveries are expected to be stable and uncoated paper volumes to decrease slightly in 2Q
‒ Metsä Board has announced to increase fresh forest fibre linerboard and uncoated fine paper prices in Europe as of April 2014
‒ Extensive annual maintenance shutdown in Husum integrate will have a negative result impact in 2Q 2014
5
EBIT, excl non-recurring items
m€
m€
Sales
20
1516
7
20
0
5
10
15
20
25
30
1Q13 2Q13 3Q13 4Q13 1Q14
271288 269 267250
0
50
100
150
200
250
300
350
1Q13 2Q13 3Q13 4Q13 1Q14
Metsä Board
Successful Early Refinancing Completed in 1Q 2014
‒ The new unsecured financing package consists of ‒ EUR 225 million bond issue at coupon of 4 per cent (over 10 times
oversubscribed)‒ EUR 150 million term loan‒ EUR 100 million revolving credit facility
‒ Gross debt EUR 721 million, cash and interest bearing receivables EUR 129 million and net debt EUR 593 million
‒ Net gearing 69%, equity ratio 41% and average interest rate dropped to 4.3% at the end of 1Q 2014
‒ Lielahti real estate in Finland was divested for EUR 26 million. EUR 19.7 million was paid for UPM based on the Court of Arbitration’s judgment
6
Average Interest Rate, %
Net Debt, m€
593
2403
0
500
1000
1500
2000
2500
3000
2006 2008 2010 2012 1Q14
4,3
6,7
0
1
2
3
4
5
6
7
8
1Q12 3Q12 1Q13 3Q13 1Q14
Metsä Board
Short-Term Profitability Outlook
7
‒ Metsä Board’s operating result, excluding non-recurring
items, is in the second quarter of 2014 expected to
weaken from the first quarter of 2014 due to the annual
maintenance shutdowns at Husum mill integrate and at
the associated company Metsä Fibre’s Joutseno and
Äänekoski pulp mills
Metsä Board
Consistent Strategic Direction
8
‒ Paperboard is Metsä Board’s core business‒ Focus on high-quality paperboards
‒ Smaller but healthier paper business‒ Heavy re-engineering and successful divestments
‒ Extensive fibre know-how and pulp self-sufficiency‒ Metsä Board’s role in Metsä Fibre’s planned new pulp mill in
Äänekoski to be clarified latest early next year
‒ Continuous development towards Super Productivity
Metsä Board
New Innovative Light-Weight Paperboards Introduced in 1Q 2014 to Broaden Offering and Accelerate Growth
9
Carta Dedica Light weight cup stock and food service board
Carta Allura Luxury packaging board
Modo Northern Light CoatedHigh quality liner for corrugated and microflute packaging
Metsä Board
Efforts to Increase Sales Volumes in North America Have Started to Bring Results
10
‒ Metsä Board’s FBB, that is even over 30% lighter in weight than other paperboards has proven its competitiveness
‒ Kemi’s coated fresh forest fibre linerboards are clear market leaders and quality benchmarks in North America
‒ Major breakthrough with new Carta Dedica in food service segment
‒ Metsä Board volume growth target in North America is in 2014 over 30% from the 170 000 tonnes in 2013
Fresh forest fibre linerboard deliveries to North America, 1,000 tonnes
0
30
60
90
120
150
2009 2010 2011 2012 2013
0
4
8
12
16
1Q13 2Q13 3Q13 4Q13 1Q14
FBB deliveries to North America, 1,000 tonnes
+82%
+70%
Metsä Board
In Addition to Folding Boxboard Metsä Board Develops Strongly and Successfully Its Linerboard Business
11
‒ Kemi’s production will by end 2014 focus almost fully on higher value added coated grades. Uncoated grades will mostly be produced in Husum
‒ Kemi mill’s annual capacity will be increased from 375 000 to 400 000 tonnes
‒ Husum’s linerboard production developing as planned to exceed 100 000 tonnes in 2014
‒ Target is to benefit Husum’s full linerboard production potential of close to 300 000 tonnes during the next few years
‒ Capacity additions have been announced also by other producers. Market balance in the high quality segment is expected to remain healthy
Metsä Board
Appendix
Metsä Board
EUR / tonne
Folding Boxboard Market Price in Europe2004 – 1Q 2014
13
Source: Pöyry Management Consulting
800
900
1000
1100
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Metsä Board
EUR / tonne
Paper and Pulp Market Price in Europe1998 – 1Q 2014
Coated fine paper (100 g)Uncoated fine paper (B-copy, 80 g)
Softwood pulp NBSKCoated magazine paper LWC (60g)
Source: Foex, Reuters
EUR/USD
EUR/USD
400
500
600
700
800
900
1000
1100
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20140,8
0,9
1
1,1
1,2
1,3
1,4
1,5
1,6
1,7
14
Metsä Board
41,0
33,3 32,4
38,7 40,7
0
5
10
15
20
25
30
35
40
45
1Q13 2Q13 3Q13 4Q13 1Q14
69707574
69
0
10
20
30
40
50
60
70
80
1Q13 2Q13 3Q13 4Q13 1Q14
Balance Sheet Ratios
Equity Ratio Net gearing%%
15
Metsä Board
Business Area Performance – Comparison to Previous Quarter
Sales, m€
1Q 20144Q 2013
16
208
250
214
271
0
50
100
150
200
250
300
350
Cartonboard Linerboard andPaper
10
2018
20
0
6
12
18
24
30
Cartonboard Linerboard andPaper
Operating result, excluding non-recurring items, m€
Metsä Board
Business Area Performance – Comparison to Previous Year*
1Q 20141Q 2013
17
Sales, m€
222
288
214
271
0
50
100
150
200
250
300
350
Cartonboard Linerboard andPaper
20
11
1820
0
6
12
18
24
30
Cartonboard Linerboard andPaper
Operating result, excluding non-recurring items, m€
Metsä Board
Ownership Structure 30.4.2014Shares Votes
Source: Euroland18