Financial statements bulletin for 1 January – 31 December 2016, 2 February 2017 at 12 noon
January–December 2016 (1–12/2015)
• Sales amounted to EUR 1,720.3 million (2,007.5).
• Comparable operating result was EUR 137.5 million (179.9), or 8.0 per cent (9.0) of sales. Operating result was EUR 132.3 million (199.0).
• Comparable result before taxes was EUR 106.8 million (150.2). Result before taxes was EUR 101.6 million (167.1).
• Comparable earnings per share were EUR 0.26 (0.34), and earnings per share were EUR 0.25 (0.39).
October–December 2016 (7–9/2016)
• Sales amounted to EUR 421.8 million (440.0).
• Comparable operating result was EUR 32.8 million (34.0), or 7.8 per cent (7.7) of sales. Operating result was EUR 38.5 million (26.6).
• Comparable result before taxes was EUR 22.8 million (27.1). Result before taxes was EUR 28.6 million (19.8).
• Comparable earnings per share were EUR 0.05 (0.07), and earnings per share were EUR 0.07 (0.05).
Essential in October–December 2016
• Paperboard deliveries fell short of the previous quarter due to seasonality.
• At the Husum integrated mill, the annual maintenance shutdown in October was extended by a week to resolve the pulp mill's technical problems. Following the shutdown, pulp production has continued normally.
• The average price of orders for Husum's new folding boxboard increased, and deliveries remained roughly on par with the previous quarter.
• CDP recognised Metsä Board's responsibility in a notable way. The company was included on the A List in the Climate and Water programmes and received Leadership status in the Forests programme.
Profit guidance for January–March 2016
Metsä Board's comparable operating result in the first quarter of 2017 is expected to improve compared to the fourth quarter of 2016.
Dividend proposal
The Board of Directors proposes to the Annual General Meeting to be held on 23 March 2017 that a dividend of EUR 0.19 per share be paid for the 2016 financial period. The proposed dividend is equal to 76 per cent of the earnings per share for 2016 and 73 per cent of the comparable earnings per share.
Mika Joukio, CEO:
“Our paperboard deliveries in 2016 grew by 12 per cent, which clearly exceeds the average growth rate of the premium fresh fibre paperboard market growth. Our sales declined as planned due to the reduced paper business. Our comparable operating result weakened compared to the previous year and was EUR 137 million. The profit development of our Finnish mills was stable overall, and five mills out of seven achieved new records in their annual production. Our operating result was burdened by the start-up of Husum's new folding boxboard production line, the technical issues in the new production line and the pulp mill, as well as the lower price level of the start-up volumes of the new folding boxboard. The decline in the pulp market price also had a negative impact on our result.
The restructuring work, which has lasted for several years, was concluded when the last fine paper reels were produced at the Husum mill in Sweden. We also discontinued the loss-making wallpaper base business at the Kyro mill in Hämeenkyrö, Finland. From now on, we will produce only premium fresh fibre paperboard for consumer goods, retail-ready and food service packaging.
At Husum, we started the installation of the extrusion coating line for food service packaging. The line will be commissioned in 2017. We will also continue the development of other barrier solutions. We will closely evaluate their commercial potential.
Technical problems in the folding boxboard production line at Husum have now been solved. With determined work carried out over several years, we have created for ourselves a growing market position in North America, where there is good demand for Metsä Board's premium paperboards. We are therefore ideally placed for continued profitable growth and increasing our market share in North America. Europe will continue to be our biggest and most important market; here, we aim to keep our leading position as a producer of folding boxboard with healthy pricing.”
FINANCIAL KEY FIGURES
| 2016 | 2016 | 2016 | 2016 | 2015 | 2016 | 2015 | |
| Q4 | Q3 | Q2 | Q1 | Q4 | Q1–Q4 | Q1–Q4 | |
| Sales, EUR million | 421.8 | 440.0 | 422.9 | 435.6 | 462.2 | 1,720.3 | 2,007.5 |
| EBITDA, EUR million | 58.9 | 60.6 | 59.6 | 55.5 | 59.1 | 234.6 | 302.5 |
| comparable, EUR million | 53.1 | 59.4 | 60.7 | 57.8 | 59.7 | 231.1 | 283.3 |
| EBITDA, % of sales | 14.0 | 13.8 | 14.1 | 12.7 | 12.8 | 13.6 | 15.1 |
| comparable, % of sales | 12.6 | 13.5 | 14.4 | 13.3 | 12.9 | 13.4 | 14.1 |
| Operating result, EUR million | 38.5 | 26.6 | 34.5 | 32.7 | 34.1 | 132.3 | 199.0 |
| comparable, EUR million | 32.8 | 34.0 | 35.8 | 35.0 | 35.1 | 137.5 | 179.9 |
| Operating result, % of sales | 9.1 | 6.0 | 8.2 | 7.5 | 7.4 | 7.7 | 9.9 |
| comparable, % of sales | 7.8 | 7.7 | 8.5 | 8.0 | 7.6 | 8.0 | 9.0 |
| Result before taxes, EUR million | 28.6 | 19.8 | 25.5 | 27.7 | 29.4 | 101.6 | 167.1 |
| comparable, EUR million | 22.8 | 27.1 | 26.8 | 30.0 | 30.4 | 106.8 | 150.2 |
| Result for the period, EUR million | 24.7 | 18.6 | 23.2 | 23.9 | 26.5 | 90.4 | 137.3 |
| comparable, EUR million | 19.2 | 24.1 | 24.6 | 25.7 | 27.5 | 93.6 | 120.2 |
| Result per share, EUR | 0.07 | 0.05 | 0.06 | 0.07 | 0.07 | 0.25 | 0.39 |
| comparable, EUR | 0.05 | 0.07 | 0.07 | 0.07 | 0.07 | 0.26 | 0.34 |
| Return on equity, % | 9.6 | 7.4 | 9.4 | 9.5 | 10.4 | 8.7 | 14.7 |
| comparable, % | 7.5 | 9.6 | 9.9 | 10.2 | 10.8 | 9.0 | 12.9 |
| Return on capital employed, % | 9.0 | 6.3 | 8.2 | 7.8 | 8.1 | 7.8 | 12.5 |
| comparable, % | 7.7 | 8.0 | 8.5 | 8.3 | 8.3 | 8.1 | 11.3 |
| Equity ratio at end of period, % | 48 | 48 | 47 | 44 | 46 | 48 | 46 |
| Net gearing ratio at end of period, % | 44 | 49 | 54 | 42 | 32 | 44 | 32 |
| Interest-bearing net liabilities/EBITDA1) | 2.0 | 2.1 | 2.1 | 1.5 | 1.2 | 2.0 | 1.2 |
| Shareholders' equity per share at end of period, EUR | 2.96 | 2.82 | 2.81 | 2.77 | 2.89 | 2.96 | 2.89 |
| Interest-bearing net liabilities, EUR million | 463.8 | 487.6 | 541.4 | 412.3 | 333.4 | 463.8 | 333.4 |
| Gross investments, EUR million | 43.3 | 16.4 | 48.3 | 54.3 | 60.8 | 162.4 | 177.8 |
| Net cash flow from operating activities, EUR million | 54.6 | 67.0 | -22.2 | -22.3 | 65.9 | 77.0 | 246.7 |
| Personnel at the end of period | 2,466 | 2,493 | 2,762 | 2,573 | 2,601 | 2,466 | 2,601 |
| 1) Ratio of end of period interest-bearing net liabilities to 12-month rolling comparable EBITDA | |||||||
Near-term outlook
Metsä Board's paperboard deliveries in January–March are expected to grow from the previous quarter. The growth is supported by Husum's new folding boxboard production, primarily sold to the Americas.
The profit development of Finnish mills is expected to remain stable, and the production costs of paperboards in January–March are expected to remain at the level of the fourth quarter in 2016.
No planned maintenance shutdowns are set to take place in January–March; this will have a positive impact on the result of the first quarter compared to other quarters.
Demand for premium fresh fibre paperboards is expected to remain good in both Europe and the Americas. The market prices of folding boxboard and white fresh fibre linerboard are expected to remain stable. Global demand and supply for long-fibre and short-fibre pulp is expected to remain stable.
METSÄ BOARD CORPORATION
Espoo, Finland
2 February 2017
BOARD OF DIRECTORS
Further information:
Jussi Noponen, CFO, tel. +358 10 465 4913
Katri Sundström, Head of Investor Relations, tel. +358 400 976 333
More information will be available as of 1 p.m. on 2 February 2017. A conference call held for investors and analysts in English will begin at 3 p.m. Conference call participants are requested to dial in and register a few minutes earlier on the following numbers:
Finland +358 9 7479 0361
Sweden +46 8 5033 6574
United Kingdom +44 330 336 9105
United States: +1 719-457-1036
The conference ID is 2804193.
