Metsä Tissue continues positive performance during 2009


04/02/2010

Metsä Tissue's sales for January-December 2009 totalled EUR 890 million 

Metsä Tissue's sales for January-December 2009 totalled EUR 890 million (930),
with operating profit amounting to EUR 93 million (42). Sales declined by -4%
on the previous year as a result of adverse exchange rates (-3%) and lower
sales volumes (-1%). The sales volumes of Metsä Tissue's own brands - notably
Lambi and Serla - showed an increase on the previous year. After a decline in
demand in the first two quarters, the company's Away-from-Home business
increased its sales volumes during the latter half of the year. “The worldwide
pandemic threat of the H1N1 virus clearly increased public awareness of the
importance of especially good hand hygiene, which had a positive impact on
sales, “comments Hannu Kottonen, CEO. 

“Pulp prices continued to climb in the second half of the year. By the end of
the year they were 25% higher than at the end of spring. The prices of pulp and
other raw materials as well as transport costs are expected to rise further in
2010. Recovered paper is in growing demand both  in Europe and as an export to
Asia, which is likely to limit its availability and push up prices”, Kottonen
continues. 

Metsä Tissue continued to invest heavily in its branded business. One example
was the launch of the Lambi Limited Collection of design-patterned household
and toilet papers in all its main markets during the first quarter. The
company's mainstream brands Serla, Mola and Tento were upgraded during the year
with new product categories, designs and product features such as balms and
fragrances. The increased consumer preference and sales growth gained by Metsä
Tissue's enhanced Serla products are among the positive outcomes of recent
investment in the company's Mariestad and Mänttä mills. 

In September, Metsä Tissue launched the SAGA brand targeted at the baking,
cooking, food processing and food service segments. From now on, the company's
baking and cooking offering will be marketed under the SAGA brand. 

The Away-from-Home business and its Katrin brand launched a Hand Care Programme
for workplaces. Other recent launches include a new line of specialty wipes for
industrial cleaning and wiping. In addition, Katrin released a new range of
dispenser designs to complement its offering of professional washroom
solutions. Metsä Tissue attracted a great deal of interest in the European
media upon release of its School Hygiene Report based on an earlier study
conducted in seven European countries. 

During the second quarter, Metsä Tissue announced the rebuild of paper machine
10 at the Mänttä mill. The rebuild will take place during the first half of
2010. Construction of new warehouses for finished goods was completed at the
company's Zilina mill, and these efficient new premises were inaugurated during
the spring. 

In September, Metsä Tissue announced its streamlined operating model and
organisation, which now comprises three instead of five business areas. Metsä
Tissue's three businesses are: Consumer, Away-from-Home and Baking & Cooking.
The napkin category is to be developed further and expanded as an integrated
part of the Consumer and Away-from-Home businesses. The company invested in
three napkin machines and ancillary printing and packaging equipment. This
investment will further increase flexibility and supply reliability. 

Metsä Tissue's strategy was crystallised and its enhanced internal
communication and implementation were launched during the second half of the
year. 

Metsä Tissue has newly upgraded its website to more effectively serve the
company's business targets. 

Action plans were drawn up and implemented on the basis of a job satisfaction
survey carried out earlier in the year. Human Resources completed SAP rollout
and the European Works Council (EWC) agreement was renewed. 

Metsä Tissue has continued to improve its energy efficiency and sustainability
through systematic development of its operations. Following an energy
efficiency audit, Metsä Tissue's Finnish and German operations were granted
Energy Efficiency Management certificates. Several plants continued to decrease
their consumption of fresh water during the year, the Warsaw plant in Poland by
as much as 30%. 
The demand for tissue and cooking paper products is expected to remain
relatively stable. Raw material and transport costs are meanwhile expected to
continue climbing. 
Metsä Tissue's cash flow generation and liquidity is good. Investments for the
entire year totalled 35 million euros. Following up intensive efficiency
improvement programmes completed over the last couple of years, the company has
expressed its intention to seek growth via development projects and programmes. 

 Tissue and Cooking Papers             Q4/09        Q4/08    1-12/09   1-12/08 
 Sales, MEUR                             229          234        890       930
 EBITDA, MEUR                             31           24        135       98
  - ” -, excl. non-recurring items, MEUR  31           25        135       99
 Depreciation and impairment, MEUR        11           14         42       56
 Operating result, MEUR                   21           10         93       42
  - ” -, excl. non-recurring items, MEUR  21           10 	  93       43
 Investments, MEUR                        17           16         35       33
 Personnel at end of period            3 152        3 222      3 152    3 222