Long versions: 
Stora Enso’s second quarter results reasonable in view of market conditions
Stora Enso’s sales for the quarter at EUR 3 388.4 million were about 7% less than the previous quarter’s EUR 3 637.0 million. The operating profit excluding non-recurring items was EUR 346.4 million, which is 33.8% less than the previous quarter’s EUR 523.0 million and 10.2% of sales. The reduction was attributable to decreased sales volumes owing to production curtailments of 558 000 tonnes, of which 342 000 tonnes were market related (205 000 tonnes in the first quarter). The profit before tax and minority interests excluding non-recurring items was EUR 248.3 million (EUR 429.5 million in previous quarter). Foreign exchange losses decreased the second quarter profit by EUR 44 million.
|
EUR million |
Full year 2000 |
Jan.-Jun. 2000 |
Jan.-Jun. 2001 |
Jan.-Mar.
2001 |
Apr.-Jun. 2001 |
|
Sales |
13 017.0 |
6 085.6 |
7 025.4 |
3 637.0 |
3 388.4 |
|
Magazine |
2 818.8 |
1 152.5 |
1 757.8 |
910.2 |
847.6 |
|
Newsprint |
1 766.7 |
833.0 |
992.4 |
501.7 |
490.7 |
|
Fine paper |
3 473.2 |
1 526.6 |
1 925.4 |
1 021.3 |
904.1 |
|
Packaging boards |
2 975.0 |
1 466.1 |
1 406.1 |
701.9 |
704.2 |
|
Timber |
1 242.1 |
632.9 |
619.1 |
307.3 |
311.8 |
|
Other divisions and
eliminations |
741.2 |
474.5 |
324.6 |
194.6 |
130.0 |
|
Operating profit* |
2 371.3 |
1 503.5 |
859.8 |
523.0 |
336.8 |
|
Magazine |
399.4 |
183.0 |
185.9 |
113.6 |
72.3 |
|
Newsprint |
268.3 |
105.8 |
259.7 |
134.1 |
125.6 |
|
Fine paper |
688.8 |
297.0 |
249.5 |
167.6 |
81.9 |
|
Packaging boards |
441.3 |
206.9 |
205.3 |
115.1 |
90.2 |
|
Timber |
73.3 |
45.5 |
13.5 |
5.6 |
7.9 |
|
Other divisions and
eliminations |
500.2 |
665.3 |
-54.1 |
-13.0 |
-41.1 |
|
Profit before tax and minority interests |
2 099.0 |
1 348.4 |
668.2 |
429.5 |
238.7 |
|
Profit for the period |
1 435.0 |
924.6 |
438.1 |
283.3 |
154.8 |
|
EPS, Basic, EUR |
1.77 |
1.22 |
0.48 |
0.31 |
0.17 |
|
EPS, Diluted, EUR |
1.76 |
1.22 |
0.48 |
0.31 |
0.17 |
|
ROCE, % |
16.8 |
16.9 |
12.2 |
15.2 |
9.7 |
|
Debt/equity ratio |
0.59 |
0.40 |
0.62 |
0.59 |
0.62 |
* Operating profit includes non-recurring items of EUR 445.7 million in 2000, EUR 578.9 million in Jan.-Jun. 2000 and EUR -9.6 million in Apr.-Jun. 2001 and Jan.-Jun. 2001.
Commenting on the results, Stora Enso’s CEO Jukka Härmälä said, "Markets were demanding, as anticipated when announcing the first quarter results. In addition to seasonal curtailments, such as the midsummer standstill that is compulsory in Finland, production was curtailed to adjust to the market demand. Demand in June was also lower for normal seasonal reasons. The impact of the curtailments is apparent in the second quarter figures. Paper and board prices have held up fairly well. Profitability should recover fairly quickly, if prices can be maintained."
Jukka Härmälä is confident about the recent acquisition of Consolidated Papers in North America. "The USD 40 million of synergies are a good achievement in the challenging economic environment, especially since the product range includes primarily coated paper, which has suffered most from the market situation. The USD 90 million synergy target will be difficult to achieve in 2001 unless demand significantly improves in North America during the second half of this year."
Markets will remain demanding and further capacity control is needed. Stora Enso will continue to adjust capacity utilisation as appropriate. The full year financial results will depend very much on the company’s ability to maintain prices, internal efficiency and cost awareness.
For further information, please contact:
Björn Hägglund, Deputy Chief Executive Officer, tel. +46 70 528 2785
Esko Mäkeläinen, SEVP, Financial Control and Legal Affairs, tel. +358 2046 21450
Kari Vainio, EVP, Communications and Investor Relations, tel. +44 77 9934 8197
Tim Laatsch, SVP, Communications, tel.+1 715 422 4023
Scott Deitz, VP, Communications and Investor Relations, tel. +1 715 422 1521
The full-length version of the Stora Enso interim review is available on the Stora Enso website at http://www.storaenso.com/investors.
Stora Enso’s third quarter interim review will be published on 25 October 2001.
