Metsä Board Corporation Financial Statements 1 January – 31 December 2013, 6 February 2014 at 12:00 noon
Full year result for 2013
- Sales were EUR 2,019.3 million (Q1–Q4/2012: 2,107.6).
- The operating result excluding non-recurring items was EUR 104.4 million (74.9). The operating result including non-recurring items was EUR 113.6 million (221.1).
- The result before taxes excluding non-recurring items was EUR 48.6 million (27.7). Result before taxes including non-recurring items was EUR 57.8 million (173.9).
- Earnings per share excluding non-recurring items were EUR 0.17 (0.13) and including non-recurring items EUR 0.19 (0.52).
- The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.09 per share will be paid for the 2013 financial period.
Result for the last quarter of 2013
- Sales were EUR 479.2 million (Q3/2013: 502.3).
- The operating result excluding non-recurring items was EUR 29.3 million (18.9). The operating result including non-recurring items was EUR 30.6 million (19.3).
- The result before taxes excluding non-recurring items was EUR 17.8 million (8.5). Result before taxes including non-recurring items was EUR 19.0 million (9.0).
- Earnings per share excluding non-recurring items were EUR 0.09 (0.02) and including non-recurring items EUR 0.09 (0.02).
Events during the last quarter of 2013
- Paperboard delivery volumes decreased from the previous quarter mainly due to seasonal reasons. The delivery volume of paper was approximately at the previous quarter’s level.
- Folding boxboard price increase negotiations in Europe were completed and contract prices will increase slightly in 2014. During the last quarter of the 2013, there were no significant changes in the average prices of Metsä Board's main products.
- Metsä Board announced it would renew its management and reporting structure. As of the first quarter of 2014, the company’s reporting segments will be Cartonboard, and Linerboard and Paper.
- Metsä Board prepaid the EUR 150 million term loan of its syndicated credit facility that took effect on 1 April 2013.
- Standard & Poor’s Ratings Services upgraded Metsä Board's credit rating from level B to B+. The outlook of the rating is stable. Moody's upgraded the outlook of its B2 rating to positive.
“The operating result of the last quarter of 2013 excluding non-recurring items improved from the previous quarter, as expected. The market situation did not change materially from the previous quarter. Paperboard delivery volumes decreased from the previous quarter, as expected, mainly due to seasonal reasons. We increased the prices of folding boxboard in Europe, resulting in slightly higher annual contract prices for 2014 than last year. Demand for kraftliner was at a good level, and prices remained stable. Paper market situation continued to be weak, and no improvement is expected in paper demand or prices.
Overall, 2013 was a challenging year due to the economic recession in Europe. Despite this, our paperboard deliveries grew by over 7 per cent and we managed to increase the contract prices of folding boxboard at the end of the year. This shows that the demand for Metsä Board's new generation ecological paperboards is strong and they are replacing other packaging materials. In order to grow our kraftliner business, we started the production of fully-bleached uncoated kraftliner at the Husum mill in Sweden in the spring 2013. Husum's new kraftliner products have had an excellent market reception. In December, a new coated paper delivery agreement was signed with Sappi. Through the new agreement, we will be able to increase kraftliner production, since the agreement also makes the production of coated kraftliner grades possible. Sales volumes of kraftliners produced in Kemi also increased as planned in 2013.
Our most important targets for 2014 include growing the folding boxboard sales further in both Europe and outside Europe, particularly in North America, increasing kraftliner production in Husum considerably, and developing new products to replace Husum’s weakest profitable paper production. At the beginning of 2014, we started the production of coated light-weight fully-bleached kraftliner at the Husum mill, in order to complement the current kraftliner product portfolio of both Husum and Kemi mills. Positive price development of our main products is one of our primary objectives in 2014, too. Productivity improvement at Metsä Board's paperboard, paper and pulp mills continued in 2013. The development measures that are under way will further improve Metsä Board's cost competitiveness also in 2014.”
Mikko Helander, CEO
Adoption of the amended IAS 19 standard
Metsä Board adopted the amended IAS 19 Employee Benefits standard retroactively on 1 January 2013. The most significant changes included the following: all actuarial profits and losses are recognised immediately, and the financial cost of retirement plans is determined on the basis of net funding.
The Group's equity decreased by approximately EUR 10.6 million due to the amendment on 31 December 2012. The 2012 operating result improved by EUR 1.4 million and financial expenses increased by EUR 3.2 million.
The impacts of amendment to IAS 19 Employee Benefits on the comparative data of balance sheet and the statement of comprehensive income as of January 1, 2012 and as of December 31, 2012 have been presented in Metsä Board Interim Report 1 January – 31 March 2013.
The amended key figures are presented in the Key Figures table (Key Figures, restated).
| KEY FIGURES, restate | 2013 | 2013 | 2013 | 2013 | 2012 | 2013 | 2012 | ||
| Q4 | Q3 | Q2 | Q1 | Q4 | Q1-Q4 | Q1-Q4 | |||
| Sales, EUR million | 479.2 | 502.3 | 502.8 | 535.0 | 508.5 | 2,019.3 | 2,107.6 | ||
| EBITDA, EUR million | 56.7 | 44.0 | 52.7 | 61.4 | 53.8 | 214.8 | 321.4 | ||
| excl. non-recurring items, EUR million | 55.5 | 43.6 | 52.1 | 56.8 | 49.0 | 208.0 | 186.0 | ||
| EBITDA, % | 11.8 | 8.8 | 10.5 | 11.5 | 10.6 | 10.6 | 15.3 | ||
| excl. non-recurring items, % | 11.6 | 8.7 | 10.4 | 10.6 | 9.6 | 10.3 | 8.8 | ||
| Operating result, EUR million | 30.6 | 19.3 | 28.9 | 34.8 | 39.3 | 113.6 | 221.1 | ||
| excl. non-recurring items, EUR million | 29.3 | 18.9 | 26.0 | 30.2 | 23.5 | 104.4 | 74.9 | ||
| EBIT, % | 6.4 | 3.8 | 5.7 | 6.5 | 7.7 | 5.6 | 10.5 | ||
| excl. non-recurring items, % | 6.1 | 3.8 | 5.2 | 5.6 | 4.6 | 5.2 | 3.6 | ||
| Result before taxes, EUR million | 19.0 | 9.0 | 21.3 | 8.5 | 25.2 | 57.8 | 173.9 | ||
| excl. non-recurring items, EUR million | 17.8 | 8.5 | 18.5 | 3.9 | 9.4 | 48.6 | 27.7 | ||
| Result for the period, EUR million | 31.2 | 7.3 | 17.6 | 8.0 | 38.2 | 64.1 | 171.3 | ||
| excl. non-recurring items, EUR million | 29.9 | 6.8 | 15.3 | 3.4 | 24.2 | 55.4 | 42.4 | ||
| Result per share, EUR | 0.09 | 0.02 | 0.06 | 0.02 | 0.11 | 0.19 | 0.52 | ||
| excl. non-recurring items, EUR | 0.09 | 0.02 | 0.05 | 0.01 | 0.08 | 0.17 | 0.13 | ||
| Return on equity, % | 14.9 | 3.6 | 8.5 | 3.8 | 18.1 | 7.5 | 21.5 | ||
| excl. non-recurring items, % | 14.3 | 3.3 | 7.4 | 1.6 | 11.5 | 6.5 | 5.3 | ||
| Return on capital employed, % | 8.2 | 5.1 | 6.7 | 7.7 | 8.7 | 7.0 | 12.4 | ||
| excl. non-recurring items, % | 7.9 | 4.9 | 6.1 | 6.8 | 5.5 | 6.4 | 4.8 | ||
| Equity ratio at end of period, % | 40.7 | 38.7 | 32.4 | 33.3 | 33.2 | 40.7 | 33.2 | ||
| Gearing ratio at end of period, % | 83 | 91 | 130 | 122 | 130 | 83 | 130 | ||
| Net gearing ratio at end of period, % | 70 | 75 | 74 | 69 | 73 | 70 | 73 | ||
| Shareholders' equity per share at end of period, EUR | 2.59 | 2.51 | 2.48 | 2.54 | 2.59 | 2.59 | 2.59 | ||
| Interest-bearing net liabilities, EUR million | 597.2 | 622.1 | 605.9 | 577.6 | 625.2 | 597.2 | 625.2 | ||
| Gross investments, EUR million | 20.2 | 16.0 | 21.5 | 9.2 | 28.2 | 66.9 | 66.1 | ||
| Deliveries, 1 000 tonnes | |||||||||
| Paperboard | 289 | 313 | 311 | 311 | 298 | 1,224 | 1,188 | ||
| Paper | 171 | 159 | 158 | 186 | 162 | 674 | 681 | ||
| Personnel at the end of period | 3,116 | 3,178 | 3,401 | 3,239 | 3,279 | 3,116 | 3,279 | ||
| Deliveries are not comparable due to restructuring. | |||||||||
| EBITDA = Earnings before interest, taxes, depreciation and impairment charges | |||||||||
The divestment of the holding in Metsä Group Treasury Oy improved Metsä Board's equity ratio by approximately 5 percentage points and return on capital employed by nearly 1 percentage point, as well as decreased the company's gross debt by more than EUR 300 million, compared to the actual figures of the second quarter of 2013. More information on the divestment is provided in the section ‘Structural changes’ in this document.
Near-term outlook Metsä Board's paperboard deliveries increased by over 7 per cent in 2013 compared to the previous year, although growth in the demand for consumer goods has been very slow in the main markets.
The delivery volumes of folding boxboard and white-top kraftliner are expected to increase slightly in the first quarter of 2014. In the last quarter of 2013, Metsä Board increased the prices of folding boxboard in Europe. The annual contracts of folding boxboard cover nearly 60 per cent of the entire year's delivery volume, and higher delivery volumes compared to last year and moderately increasing price level have been agreed with customers for 2014. The average price of folding boxboard in the first quarter of 2014 is expected to increase slightly from the last quarter of 2013. No material changes are in sight in the average price level of white-top kraftliner in the near future.
Delivery volumes of uncoated fine paper and coated papers are expected to be approximately at the previous quarter's level in the first quarter of 2014. No material paper price changes are in sight. Delivery volumes and the average price of Metsä Board's market pulp are expected to be approximately at the previous quarter's level in the first quarter of 2014.
Production costs are in the first quarter of 2014 expected to be approximately at the previous quarter’s level.
Metsä Board’s operating result, excluding non-recurring items, is in the first quarter of 2014 expected to improve slightly from the last quarter of 2013.
Disclosure procedure Metsä Board Corporation follows the disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority and hereby publishes its Financial Statements 2013 enclosed to this stock exchange release. Metsä Board's complete Financial Statements is attached to this release in pdf-format and is also available on the company's web site at www.metsaboard.com .
METSÄ BOARD CORPORATION
Further information:
Markus Holm, CFO, tel. +358 (0)10 465 4913
Juha Laine, Vice President, Investor Relations and Communications, tel. +358 (0)10 465 4335
More information will be available starting from 1 p.m. on 6 February 2014. A conference call held in English for investors and analysts starts at 3 p.m. (EET). Conference call participants are requested to dial in and register a few minutes prior to the start of the conference call on the following numbers:
Europe: +44 (0)20 7162 0025
US: +1 334 323 6201
The conference ID is 940872.
Metsä Board is Europe’s leading producer of folding boxboard, the world’s leading manufacturer of coated white-top kraftliners and a major paper supplier. It offers premium solutions for consumer and retail packaging, graphics and office end-uses. The company’s sales network serves brand owners, carton printers, corrugated packaging manufacturers, printers, merchants and office suppliers. Metsä Board is part of Metsä Group and its shares are listed on the NASDAQ OMX Helsinki. In 2013, the company’s sales totalled approximately EUR 2.0 billion. The company has approximately 3,100 employees.
www.metsaboard.com
