results 2013 of metsä board, presentation
DESCRIPTION
Metsä Board results 2013 presentation: "The operating result of the last quarter of 2013 excluding non-recurring items improved from the previous quarter, as expected."TRANSCRIPT
Metsä Board
1
Metsä BoardResults 2013
Metsä Board
Key Events in 2013
‒ Profitability improved from previous year
‒ Folding boxboard and white top kraftliner deliveries increased clearly and folding boxboard prices were increased in late 2013
‒ Sustainability and printing properties of Metsä Board’s folding boxboards were further improved by renewed products launched in spring
‒ Exposure to paper business was further reduced by starting successfully kraftlinerproduction at Husum mill
‒ Metsä Board’s management structure was renewed at year end to accelerate growth
‒ Net debt reduced to 597 m€ and credit ratings improved
2
Metsä Board
Result, Excluding Non-Recurring Items, Improved from Previous Year
28 49
0
25
50
75
100
2012 2013
174
580
100
200
300
2012 2013
4,86,4
0
3
6
9
12
2012 2013
2108 2019
0
1000
2000
3000
2012 2013
74
104
0
40
80
120
2012 2013
SalesOperating result, excl. non-rec. items
Result before taxes, excl. non-rec. items
m€ m€
m€
221
104
0
100
200
300
2012 2013
Operating result
m€
Result before taxes
m€
ROCE, excl. non-rec. items
%
Board of Directors is proposing to the AGM a dividend of 0.09€ per share for the financial year 2013
3
Metsä Board
625 24 26
436
32
-21
20 3019 29
-40
-20
0
20
40
60
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
685 660 616 524 545 522 502509532 535479503
0
200
400
600
800
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
28 16-11
-33
17 9 1810 9-9
194
-50
-25
0
25
50
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Sales, m€ Operating result excl. non-rec. items, m€
Result before taxes excl. non-rec. items, m€
Operating Result in 4Q 2013 Improved as Expected Despite Seasonally Lower Deliveries
4
Metsä Board
‒ Result was weakened mainly by the seasonally decreased delivery volumes
‒ Average prices were stable in 4Q 2013
‒ Folding boxboard and white top kraftliner deliveries are expected to increase in 1Q 2014
‒ FBB contract prices are somewhat higher in 2014 vs. 2013. Also volumes increased in 2014 annual contracts
‒ No material white top kraftliner price changes in sight
5
EBIT, excl. non-recurring items
Sales
Paperboard’s 4Q Results Roughly at Previous Quarter Level
m€
m€
32
25 24 2227
24
28 27
0
10
20
30
40
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
269289289293
279289274281
0
50
100
150
200
250
300
350
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Metsä Board
Paper and Pulp’s Results Improved Mainly Due to Normalized Production at Husum
‒ Production at Husum normalized after extensive shutdown in 3Q 2013
‒ Kraftliner deliveries from Husum increased as planned
‒ WFU delivery volumes increased but average prices weakened from 3Q 2013
‒ Coated paper and market pulp delivery volumes decreased somewhat and prices were stable
‒ Kraftliner deliveries will increase and paper and market pulp deliveries are expected be stable in 1Q 2014
‒ No material paper price changes in sight. Average price for Metsä Board’s market pulp deliveries expected to remain stable in 1Q 2014
6
EBIT, excl non-recurring items
m€
m€
Sales
-2
4
-2
8
-12
52
0
-15
-10
-5
0
5
10
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
216198 199 189
245 229 223210
0
50
100
150
200
250
300
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Metsä Board
Good Financial Situation Continues
‒ Gross debt EUR 701 million, cash and interest bearing receivables EUR 104 million and net debt EUR 597 million
‒ EUR 100 million RCF fully available
‒ Net gearing 70%, equity ratio 40.7% and average interest rate 4.8% at the end of 2013
‒ EUR 150 million term loan was prepaid and EUR 75 million pension loan and a EUR 50 million bank loan were drawn
‒ S&P upgraded Metsä Board’s credit rating from B to B+, Moody’s changed their B2 outlook to positive
‒ Lielahti property divestment worth EUR 26 million expected to materialize by end 1Q 2014
Net Debt, m€
597
3693
2403
0
500
1000
1500
2000
2500
3000
3500
4000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
7
Metsä Board
Short-Term Profitability Outlook
8
‒ 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
Metsä Board
New Management Structure Took Effect on 1 January 2014
‒ Metsä Board operates from 2014 onwards through two business areas:‒ Cartonboard (Kyro, Simpele, Tako, Äänekoski, Joutseno and Gohrsmühle)‒ Linerboard and Paper (Husum, Kemi and Kaskinen)
‒ Reason for the renewed structure is acceleration of growth
‒ About 60% of the result impact of Metsä Fibre ownership is expected to be booked in the Linerboard and Paper and the rest in the Cartonboard business area
‒ Reporting from 1Q 2014 onwards is based on the new business area structure‒ Historical segment numbers announced in February 2014
9
Metsä Board
Emphasis of North American Markets To be Increased in Metsä Board’s Folding Boxboard Business
‒ Cartonboard consumption in North America is focused on traditional heavy grades
‒ Yield advantage for customers by changing to Metsä Board’s folding boxboards even over 30 per cent
‒ Sustainability and safety increasingly important also for North American brand owners
‒ North American cartonboard market is 8 million tonnes/a
‒ Metsä Board aims at being a significant sustainable alternative for North American brand owners
‒ Short term target is to double FBB volumes from 35 000 tonnes
‒ Metsä Board already has a leading position in North American high quality white top kraftliner market
Share of ecological FBB of total cartonboard market
Europe 34%North America 4%
Asia 22%
10
Metsä Board
‒ Production of light weight uncoated kraftliner started in April 2013‒ Deliveries in 2013 about 20 000 tonnes‒ Run rate currently over 60 000 tonnes/a
‒ Production of newly developed light weight coated kraftliner was started in early 2014
‒ Europe’s largest state of art off line coating line ‒ Updated coated paper contract with Sappi frees up coating capacity
‒ Total kraftliner production target in 2014 increased to over 100 000 tonnes
‒ Husum’s kraftliner capacity is close to 300 000 tonnes/a without any investments
‒ Husum offers great opportunities for Metsä Board to grow further in the paperboard business
11
Development of New Products Proceeding Well at Husum
Metsä Board
Key Focus Areas in 2014
1.Increase folding boxboard sales further based on the light weight concept- Fully benefit the current folding boxboard capacity- Prepare for the next capacity increase
2. Clear increase of kraftliner sales- Full utilization of Husum’s kraftliner production potential- Further increase of Kemi mill’s production output
3. Secure good folding boxboard and kraftliner price levels
4. Develop and launch new folding boxboard and kraftliner products
5. Maximize cash flows from decreasing paper businesses
6. Continuous improvements to achieve Super Productivity and Best-in-Class supply chain
12
Metsä Board
Appendix
Metsä Board
EUR / tonne
Folding Boxboard Market Price in Europe2004 – 2013
14
Source: Pöyry Management Consulting
800
900
1000
1100
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Metsä Board
EUR / tonne
Paper and Pulp Market Price in Europe1998 – 2013
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 20130,8
0,9
1
1,1
1,2
1,3
1,4
1,5
1,6
1,7
15
Metsä Board
33,3 32,4
38,740,7
27,931,1 31,2 33,2
0
5
10
15
20
25
30
35
40
45
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13* 4Q13
707574
69737073
103
0
20
40
60
80
100
120
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Balance Sheet Ratios
Equity Ratio Net gearing%%
16
*Divestment of 51 % in Metsä Group Treasury improved equity ratio by about 5 percentage points
Metsä Board
Business Area Performance – Comparison to Previous Quarter*
Sales, m€
4Q 20133Q 2013
17
289
199
269
189
0
50
100
150
200
250
300
350
Paperboard Paper and Pulp
24
‐2
22
8
‐10
0
10
20
30
40
Paperboard Paper and Pulp
Operating result, excluding non-recurring items, m€
*Metsä Board BA structure changesfrom 1Q 2014 reporting onwards
Metsä Board
Business Area Performance – Comparison to Previous Year*
Sales, m€
20132012
18
1123
907
1140
802
0
300
600
900
1200
1500
Paperboard Paper and Pulp
108
‐6
103
8
‐30
0
30
60
90
120
150
Paperboard Paper and Pulp
Operating result, excluding non-recurring items, m€
*Metsä Board BA structure changesfrom 1Q 2014 reporting onwards
Metsä Board
Ownership Structure 31.12.2013Shares Votes
Source: Euroland19