INTERIM REPORT January–June 2016


(Tables included in attached PDF)
KEY HIGHLIGHTS

  · Although net sales for the quarter amounted to SEK 5 439 million which was
SEK 50 million lower compared to the same period last year, for comparable units
net sales increased with SEK 105 million or approximately 2%.
  · Sales volumes increased with 4% compared to the same period last year.
  · Earnings per share for the quarter amounted to SEK 1.93 (1.92).
  · Costs for planned maintenance shutdowns in the production units in Gruvön
and Skärblacka amounted to SEK 244 million, compared to estimated SEK 220
million.
  · Significant improvements were made in the production and production was
running according to plans towards the end of the quarter.

OUTLOOK

  · Demand and order situation for the third quarter is expected to be stable
with normal seasonal variances for all business areas.
  · Average prices in local currency in the third quarter are in general
anticipated to be stable with exceptions for some segments.
  · No changes to wood prices are anticipated for the third quarter.
  · Gävle and Karlsborg production units will have planned maintenance shutdowns
during the third quarter.


Comments by BillerudKorsnäs’ CEO Per Lindberg:
Stability and production platform investment
”After a couple of troublesome quarters we are now back on track with production
running according to plans. The second quarter performance is in line with our
own expectations. During the quarter it was decided to proceed with the
investment in Skärblacka. The investment will enable further growth in
attractive market segments and at the same time streamline the company’s
production structure. The investment program will develop the Skärblacka
production unit in Sweden into a world leading center for machine glazed, MG,
kraft paper production, hence creating a competitive future platform for
Packaging Paper to enable the selective growth strategy”
THE RESULT
Net sales for comparable units increased 2% compared to Q2 last year and year on
year net sales show a slight increase of 1%. Adjusted EBITDA for comparable
units improved with 3% compared to the first six months last year, in spite of
approximately SEK 74 million higher costs for periodic maintenance shutdowns
this year. Results improved in both Consumer Board and Corrugated Solutions
business areas. The item affecting comparability is related to a fraud case that
caused a loss of SEK 25 million in June, this is something we treat very
seriously and we work diligently to try to recover the money. Our return on
capital employed reached 14% which is above our target and our working capital
in relation to sales improved from previous quarter from 12% to 11%. Our net
debt to EBITDA ratio increased due to dividend payout to 1.32, but is
significantly lower than our target of below 2.5.
MARKET OUTLOOK
Overall the market was stable and we anticipate that to continue.

For Business area Packaging Paper the brown and white sack paper markets
strengthened seasonally. The pulp price was down compared to Q2 last year. The
remaining segments in Packaging Paper had a stable market development with no
changes to local prices.

Consumer Board delivered lower sales volumes than the first six months last year
as a consequence of the problems in production in Q4 last year and the previous
quarter. But as we now are back on track in production we anticipate that we
will reach our growth targets during the second half of the year.
Business area Corrugated Solutions shows a continued strong performance in spite
of the fact that the market did not develop as we anticipated during the quarter
where liner has been stronger than expected and fluting a bit tougher than
anticipated.
STRATEGY
Part of our strategy for creating long-term profitable growth is to expand our
position in the value chain as well as geographically. Based on our focus and
expertise in the packaging area we want both to develop and complement our
sustainable materials with packaging solutions to a larger extent. It is a
natural development but also necessary. In new markets, complete solutions are
often required in order to introduce new materials.
During the past six months, the former subsidiary PACCESS (now Managed
Packaging), with a business model fully based on packaging solutions, was fully
integrated into BillerudKorsnäs. Even more recently a complete packaging system
was launched together with Bosch. The latter is a unique solution for sealed
packaging of dry foods based fully on renewable material. The development toward
more packaging solutions is a natural evolution within each business area. In
addition there is room for more revolutionary solution development in the newly
formed subsidiary BillerudKorsnäs Venture AB.
BillerudKorsnäs’ President and CEO Per Lindberg and CFO Susanne Lithander will
present the interim report at a press and analyst conference at 10.00 CET on
Wednesday 20 July 2016.
Venue: Tändstickspalatset, Västra Trädgårdsgatan 15, Stockholm
For further information, please contact:
Per Lindberg, President and CEO +46 (0)8 553 335 00
Susanne Lithander, CFO, +46 (0)8 553 335 00
This information is information that BillerudKorsnäs AB (publ) is obliged to
make public pursuant to the EU Market Abuse Regulation and the Securities
Markets Act. The information was submitted for publication, through the agency
of the contact persons set out above, at 07.00 CET on 20 July 2016. This
information has been prepared in both a Swedish and an English version.
BillerudKorsnäs provides packaging materials and solutions that challenge
conventional packaging for a sustainable future. We are a world leading provider
of primary fiber based packaging materials and have customers in over 100
countries. The company has 8 production sites in Sweden, Finland and the UK and
about 4 200 employees in over 13 countries. BillerudKorsnäs has an annual
turnover of about SEK 22 billion and is listed on Nasdaq Stockholm.
www.billerudkorsnas.com (http://www.billerudkorsnas.com%20)

Attachments

Excel tabeller web Q2 2016-en.xls 07209434.pdf