Interim Report Q2 2021: SCA
SCA reported net sales of SEK 8,982m for January-June 2021, down from SEK 9,480m, impacted by discontinued paper operations. However, excluding these effects, sales increased by 17%. EBITDA soared 78% to SEK 3,619m, with a margin of 40.3%. The second quarter saw net sales of SEK 4,810m, a 15% rise from the previous quarter. Strong demand for solid-wood products and ongoing growth projects support a positive outlook. Forest asset values increased to SEK 76.6bn.
- EBITDA increased by 78% to SEK 3,619m, improving EBITDA margin to 40.3%.
- Net sales increased by 17% when excluding discontinued operations.
- Operating cash flow improved to SEK 1,581m, enabling growth projects.
- Forest asset value rose to SEK 76.6bn as of June 30, 2021.
- Net sales declined to SEK 8,982m from SEK 9,480m due to discontinued operations.
- Divestment of Wood Supply UK affected sales negatively.
STOCKHOLM, July 23, 2021 /PRNewswire/ --
January-June 2021 compared with January-June 2020
- Net sales amounted to SEK 8,982m (9,480). The lower sales level was related to the discontinued publication paper operations and the divestment of Wood Supply UK. Excluding these effects, net sales increased by
17% , driven by higher selling prices in all product areas. - EBITDA improved
78% to SEK 3,619m (2,031). The increase was mainly attributable to higher selling prices in all product areas, but also to good production and a stable, low cost level. EBITDA margin was40.3% (21.4). - Operating profit increased to SEK 2,927m (1,228).
- Operating cash flow amounted to SEK 1,581m (614).
- Earnings per share increased to SEK 3.25 (1.34).
April-June 2021 compared with April-June 2020
- Net sales amounted to SEK 4,810m (4,687). The increase was mainly attributable to higher selling prices, which were offset by the discontinued publication paper operations and the divestment of Wood Supply UK.
- EBITDA amounted to SEK 2,260m (1,001) and EBITDA margin increased to
47.0% (21.3).
April-June 2021 compared with January-March 2021
- Net sales increased by
15% to SEK 4,810m (4,172). The change was mainly attributable to higher selling prices. - EBITDA amounted to SEK 2,260m (1,359) and EBITDA margin increased to
47.0% (32.6).
SUMMARY OF THE SECOND QUARTER OF 2021
Earnings for the second quarter of 2021 were the highest since the distribution of Essity in 2017 and represent a significant improvement compared with the preceding and year-earlier quarters. Higher selling prices, higher production and stable, low costs in all product areas had a positive impact on earnings.
The supply of wood to SCA's industries was stable throughout the quarter. Prices for timber and pulpwood were stable compared with the preceding period.
The market situation for solid-wood products continued to strengthen, driven by increased global demand in the building materials trade and construction industry. Sustained strong demand has led to a continuation of low inventory levels and significantly increased market prices.
During the period, selling prices for pulp increased further, especially in Europe and the US. Delivery volumes increased slightly compared with the preceding quarter. Global inventory levels were normal.
Demand for kraftliner continued to strengthen, driven by high box demand. The average selling price was higher than the preceding quarter.
Operating cash flow was strong and has financed SCA's ongoing growth projects – to expand kraftliner manufacturing in Obbola and to increase production of chemically pre-treated mechanical pulp (CTMP) at the Ortviken site. The investment projects are progressing on time and on budget.
Higher transaction prices for forest assets in northern Sweden
SCA has based the valuation of its forest assets in Sweden on forest transactions in the areas where SCA owns forest assets. The market value of the forest assets increased during the first six months of 2021. At June 30, the average market price applied to SCA's forest assets was SEK 300/m³fo. When applied to SCA's standing timber volume, the total value of SCA's forest assets was SEK 76.6bn. At December 31, 2020, the market price was SEK 291/m³fo and the total value of SCA's forest assets was SEK 74.9bn.
INVITATION TO PRESS CONFERENCE ON INTERIM REPORT FOR THE 2nd QUARTER OF 2021
Members of the media and analysts are hereby invited to attend a press conference where this interim report will be presented by the President and CEO, Ulf Larsson, and CFO, Toby Lawton.
Time: Friday, July 23, 2021 at 10:00 a.m. CET
The press conference will be webcast live at www.sca.com. It is also possible to participate by telephone by calling:
Sweden: +46 (0)8 5069 2180
UK: +44 (0)2071 928000
US: +1 631 510 7495
Specify "SCA" or the conference ID: 4394816
Sundsvall, July 23, 2021
SVENSKA CELLULOSA AKTIEBOLAGET SCA (publ)
Ulf Larsson
President and CEO
For further information, please contact:
Toby Lawton, CFO, +46 (0)60 19 31 09
Josefine Bonnevier, Investor Relations Director, +46 (0)60 19 33 90
Anders Edholm, Senior Vice President, Communications, +46(0)60 19 32 12
Please note:
This is information that SCA is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. This report has been prepared in both Swedish and English versions. In case of variations in the content between the two versions, the Swedish version shall govern. The information was submitted for publication, through the agency of the contact person set out below, on July 23, 2021 at 08:00 a.m. CEST. The report has been reviewed by the company's auditors.
Anders Edholm, Senior Vice President, Communications, +46 (0)60 19 32 12
The core of SCA's business is the growing forest, Europe's largest private forest holding. Around this unique resource, we have built a well-developed value chain based on renewable raw material from our own and others' forests. We offer packaging paper, pulp, wood products, renewable energy, services for forest owners and efficient transport solutions.
2020 the forest products company SCA had approximately 4,000 employees and sales amounted to approximately SEK 18.4 bn. SCA was founded in 1929 and has its headquarters in Sundsvall, Sweden. For more information, visit www.sca.com.
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SOURCE SCA
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