Interim report 1 January−31 March 2017, 4 May 2017 at 12:00 noon
January–March 2017 (10–12/2016)
• Sales amounted to EUR 444.5 million (421.8).
• Comparable operating result was EUR 45.2 million (32.8), or 10.2 per cent (7.8) of sales. Operating result was EUR 45.2 million (38.5).
• Comparable result before taxes was EUR 39.9 million (22.8). Result before taxes was EUR 39.9 million (28.6).
• Comparable earnings per share were EUR 0.10 (0.05), and earnings per share were EUR 0.10 (0.07).
January–March 2017 (1–3/2016)
• Sales amounted to EUR 444.5 million (435.6).
• Comparable operating result was EUR 45.2 million (35.0), or 10.2 per cent (8.0) of sales. Operating result was EUR 45.2 million (32.7).
• Comparable result before taxes was EUR 39.9 million (30.0). Result before taxes was EUR 39.9 million (27.7).
• Comparable earnings per share were EUR 0.10 (0.07), and earnings per share were EUR 0.10 (0.07).
Events in January–March 2017
• The delivery volumes of Metsä Board’s paperboards and market pulp increased from the previous quarter.
• The market prices of folding boxboard remained stable. The average price of Metsä Board's folding boxboard was burdened by Husum's sales mix. The prices of coated white-top fresh fibre linerboard rose in North America.
• The capacity utilisation rate of Husum's new folding boxboard machine was approximately 70 per cent during the review period.
• No major maintenance shutdowns took place during the review period.
• Metsä Board's Annual General Meeting was held on 23 March 2017. The Annual General Meeting decided to pay a dividend of 0.19 euros per share for the 2016 financial period.
Events after the period
• The new extrusion coating line started up at Husum mill in Sweden in April.
Profit guidance for April–June 2017
Metsä Board's comparable operating result for the second quarter of 2017 is expected to remain roughly on the same level as in the first quarter of 2017.
Metsä Board's CEO Mika Joukio:
“The delivery volumes of paperboards grew compared to the previous quarter and achieved a monthly all-time high in March. As expected, the most significant growth derived from Husum's folding boxboard, but demand for fresh fibre linerboards was also strong. Our operating result was supported by the positive development of Finnish mills and a strong pulp market. No major maintenance shutdowns that would have weakened the result took place during the review period.
We still have plenty of potential to improve our profitability at Husum. In folding boxboard, the increase of the capacity utilisation rate will lower the production costs per tonne produced. The extrusion coating line targeted for food and food service packaging will speed up sales growth in a customer segment that is new for us. In fresh fibre linerboards, our focus in the coming years is increasingly on coated linerboard, which has better profitability than uncoated linerboard.
In 2017, we aim to sell 300,000 tonnes of Husum's folding boxboard primarily in North America, where demand for Metsä Board's paperboards is strong. The lightness of our folding boxboard is still a considerable competitive advantage for us, and one of the most important focus areas in our product development. Increasing product safety requirements and the growing emphasis on the appearance of packaging are increasing demand for premium and sustainably produced packaging materials. Metsä Board's paperboards bring all these qualities together. We want to continue to develop our products in such a way that they meet our customers' needs and to keep growing profitably together with our customers in the coming years.”
FINANCIAL KEY FIGURES
| 2017 | 2016 | 2016 | 2016 | 2016 | 2016 | |
| Q1 | Q4 | Q3 | Q2 | Q1 | Q1–Q4 | |
| Sales, EUR million | 444.5 | 421.8 | 440.0 | 422.9 | 435.6 | 1,720.3 |
| EBITDA, EUR million | 68.8 | 58.9 | 60.6 | 59.6 | 55.5 | 234.6 |
| comparable, EUR million | 68.8 | 53.1 | 59.4 | 60.7 | 57.8 | 231.1 |
| EBITDA, % of sales | 15.5 | 14.0 | 13.8 | 14.1 | 12.7 | 13.6 |
| comparable, % of sales | 15.5 | 12.6 | 13.5 | 14.4 | 13.3 | 13.4 |
| Operating result, EUR million | 45.2 | 38.5 | 26.6 | 34.5 | 32.7 | 132.3 |
| comparable, EUR million | 45.2 | 32.8 | 34.0 | 35.8 | 35.0 | 137.5 |
| Operating result, % of sales | 10.2 | 9.1 | 6.0 | 8.2 | 7.5 | 7.7 |
| comparable, % of sales | 10.2 | 7.8 | 7.7 | 8.5 | 8.0 | 8.0 |
| Result before taxes, EUR million | 39.9 | 28.6 | 19.8 | 25.5 | 27.7 | 101.6 |
| comparable, EUR million | 39.9 | 22.8 | 27.1 | 26.8 | 30.0 | 106.8 |
| Result for the period, EUR million | 34.2 | 24.7 | 18.6 | 23.2 | 23.9 | 90.4 |
| comparable, EUR million | 34.2 | 19.2 | 24.1 | 24.6 | 25.7 | 93.6 |
| Result per share, EUR | 0.10 | 0.07 | 0.05 | 0.06 | 0.07 | 0.25 |
| comparable, EUR | 0.10 | 0.05 | 0.07 | 0.07 | 0.07 | 0.26 |
| Return on equity, % | 13.1 | 9.6 | 7.4 | 9.4 | 9.5 | 8.7 |
| comparable, % | 13.1 | 7.5 | 9.6 | 9.9 | 10.2 | 9.0 |
| Return on capital employed, % | 10.6 | 9.0 | 6.3 | 8.2 | 7.8 | 7.8 |
| comparable, % | 10.6 | 7.7 | 8.0 | 8.5 | 8.3 | 8.1 |
| Equity ratio at end of period, % | 47 | 48 | 48 | 47 | 44 | 48 |
| Net gearing ratio at end of period, % | 44 | 44 | 49 | 54 | 42 | 44 |
| Interest-bearing net liabilities/EBITDA1) | 1.9 | 2.0 | 2.1 | 2.1 | 1.5 | 2.0 |
| Shareholders' equity per share at end of period, EUR | 2.90 | 2.96 | 2.82 | 2.81 | 2.77 | 2.96 |
| Interest-bearing net liabilities, EUR million | 457.8 | 463.8 | 487.6 | 541.4 | 412.3 | 463.8 |
| Gross investments, EUR million | 19.0 | 43.3 | 16.4 | 48.3 | 54.3 | 162.4 |
| Net cash flow from operating activities, EUR million | 25.6 | 54.6 | 67.0 | -22.2 | -22.3 | 77.0 |
| Personnel at the end of period | 2,450 | 2,466 | 2,493 | 2,762 | 2,573 | 2,466 |
Near-term outlook
Global demand for high-quality consumer packaging board made from fresh fibre is expected to continue to grow. The increases in capacity made by European producers of folding boxboard have not had a negative impact on price development. Several producers of white fresh fibre linerboards announced price increases in Europe and North America at the beginning of the year. Global demand and supply for long-fibre and short-fibre pulp is expected to remain stable.
Metsä Board's paperboard deliveries in April–June are expected to grow from the previous quarter. The growth is supported by Husum's production of folding boxboard.
A number of maintenance shutdowns will take place at Metsä Board's mills in Finland during the second quarter of the year. The production costs of paperboards will continue to be impacted by the price increase of latex.
METSÄ BOARD CORPORATION
Espoo, Finland, 4 May 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 4 May 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 0404
Sweden +46 8 5065 3942
United Kingdom +44 330 336 9412
United States: +1 719-325-2385
The conference ID is 2112158.
Metsä Board is a leading European producer of premium fresh fibre paperboards including folding boxboards, food service boards and white kraftliners. Our lightweight paperboards are developed to provide better, safer and more sustainable solutions for consumer goods as well as retail-ready and food service applications. We work together with our customers on a global scale to innovate solutions for better consumer experiences with less environmental impact. The pure fresh fibres Metsä Board uses are a renewable resource, traceable to origin in sustainably managed northern forests.
The global sales network of Metsä Board supports customers worldwide, including brand owners, retailers, converters and merchants. In 2016, the company’s sales totalled EUR 1.7 billion, and it has approximately 2,500 employees. Metsä Board, part of Metsä Group, is listed on the Nasdaq Helsinki.
