STOCKHOLM, Sweden, July 18, 2002 (PRIMEZONE) -- Billerud:
Quarter January-June
2002 2002 2001
II I II 2002 2001
Net turnover, MSEK 1 772 1 756 1 742 3 528 3 582
Operating profit, MSEK 251 268 319 519 788
Operating margin, % 14 15 18 15 22
Profit after financial items, 228 247 292 475 733
MSEK
Earnings per share, SEK 2.64 2.82 3.34 5.46 8.38
-- Rising market demand has led to improved orders for
Billerud. Price increases have been carried out which will
affect profits fully as from quarter 4. Profits for the second
half of 2002 are expected to be better than for the first half.
-- Production efficiency and delivery capability were at a
high level. A maintenance stoppage was carried out at
Skarblacka during the second quarter. Deliveries in the first
six months of the year reached 666 000 tonnes, up 10% on the
same period last year.
-- The operating profit of MSEK 519 was down 34% on the same
period last year. The operating profit in the second quarter
was 6% lower than the first quarter and 21% lower than the
second quarter of 2001. Around MSEK 90 of the operating profit
was profit from currency hedging.
-- Accumulated synergy effects amount to MSEK 75 on an annual
basis.
-- The return on capital employed during the most recent 12-
month period was 21%.
-- Stora Enso has sold 29.5% of the shares in Billerud AB.
The buyers are Swedish and foreign investors.
-- Billerud has bought back 2.85 million shares, about 60% of
possible repurchase.
A telephone conference in English will be held at 6 p.m. CET, call +44 20 8781 0562
See a film presentation of the conference on www.billerud.com from 9 p.m. CET today.
Billerud Group
Market
A general rise in demand for Billerud's products was noted during the second quarter of 2002. However, deliveries, which were limited by available capacity, remained at the same level as the first quarter at 333 000 tonnes. Deliveries in the first six months of the year thus totalled 666 000 tonnes, up around 10% on the same period in 2001. Stocks of finished products were reduced by around 20 000 tonnes 18% in the same period.
Rising demand was noted for Billerud's packaging paper during the second quarter. The improvement in orders encouraged Billerud to initiate price rises for nearly all paper grades during the third quarter of 2002. Deliveries of packaging paper amounted to 500 000 tonnes during the first six months of 2002, up around 8% on the same period in 2001.
Stocks of market pulp fell during the quarter due mainly to generally low capacity utilisation. The market price for long- fibre sulphate pulp was around USD 435 per tonne at the start of the second quarter. During the second quarter, market price increased successively to about USD 480 per tonne. Further price rises have been announced starting in July. Even larger price rises have been noted for short-fibre pulp. Billerud's deliveries of market pulp amounted to 166 000 tonnes during the first six months of 2002, a rise of around 14% compared with the same period in 2001.
Sales and results
Second quarter
Net sales for the second quarter reached MSEK 1 772, up 1% on the first quarter. The increase was mainly due to currency effects. Price levels and delivery volumes were mainly unchanged.
The operating profit reached MSEK 251, down MSEK 17 or 6% on the first quarter due to slightly higher cost levels in the second quarter.
Comments on the earnings trend for each product area are provided on page 4.
Net financial items were negative at MSEK -23 and consisted primarily of interest costs for Billerud's syndicated bank loan. Net financial items included one-off costs of MSEK 3 connected with the raising of a bond loan and a convertible promissory note. The profit after financial items was MSEK 228.
January - June
Net sales amounted to MSEK 3 528, down 2% on the same period in 2001. The fall was due to reduced prices, mainly for market pulp but also for Billerud's paper products. The reduction was partly compensated for by a 10% increase in delivery volumes.
The operating profit reached MSEK 519, down MSEK 269 or 34% on the same period in 2001. The fall was due to lower prices, which were only partly compensated for by higher delivery volumes and lower costs, especially for chemicals.
Financial items amounted to MSEK -44, MSEK 11 or 20% lower compared to the same period in 2001. The improvement was completely due to a lower net debt level. The estimated tax cost was MSEK 134, representing a tax rate of around 28%. Synergies
Co-ordination effects of around MSEK 200 were forecast in connection with the formation of Billerud. Since the start of 2001 a streamlining project has been at work to achieve these effects. The result will be a boost to profits of at least MSEK 170 on annual basis starting from the end of 2003. In addition there are pure cost synergies of MSEK 30. The overall effect, therefore, is expected to be at least MSEK 200 on an annual basis after 2003.
At the end of the first six months of 2002 the co-ordination effects are estimated to reach MSEK 75 on an annual basis, compared with MSEK at the end of 2001.
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