Södra Reports Strong Second Quarter 2017 Results
"Higher prices for both market pulp and sawn timber contributed to a strong quarter for Södra." – Lars Idermark, President and CEO, Södra.
July 20, 2017 (Press Release) – Södra's operating profit totalled SEK 464 million (50) for the second quarter. The trend was boosted by favourable demand for Södra's products, higher prices and internal operational improvements.
"The overall forest economy remains strong, which is to Södra's advantage. Higher prices for both market pulp and sawn timber contributed to a strong quarter for Södra. A firmer customer and market orientation is also yielding results. In addition, the expansion investments at our pulp mills and the restructuring process in the sawmill operations had a positive impact on operating profit," said Lars Idermark, President and CEO.
"All business areas reported higher year-on-year operating profit. Efforts to increase our strength and focus, based on Södra's new strategic direction, will continue unabated", said Lars Idermark.
Consolidated net sales amounted to SEK 5,244 million (4,953) for the second quarter, up 6 percent, and the operating margin increased to 9 percent (1).
Södra Skog's operating profit for the quarter totalled SEK 37 million (36), reflecting volume growth of 4 percent.
Södra Wood's operating profit for the second quarter totalled SEK 50 million (loss: 204). The sharply increased result was mainly due to improved earnings for sawn timber. In addition, the second quarter of 2016 was impacted by a non-recurring cost of SEK 204 million related to the restructuring of Södra Wood's sawmill operations.
Södra Cell's operating profit for the second quarter totalled SEK 418 million (253), an improvement of 65 percent. The earnings trend was mainly due to higher volumes. Following the extensive expansion investments of recent years, the pulp mill at Värö is now fully operational and capacity is increasing according to plan, resulting in higher production and delivery volumes.
Sales for the first half-year amounted to SEK 10,342 million (9,498), the operating profit totalled SEK 915 M (299) and the operating margin was 9 percent (3). Return on capital employed was 11 percent (4) and equity ratio was 55 percent (52).
Södra, with headquarters in Vaxjo, Sweden, produces market pulp, wood products and biofuels. The company operates three pulp mills in Sweden (Mörrum, Mönsterås and Värö.) with a total capacity of 1.6 million tonnes per year. Sodra produces both softwood and hardwood pulp — 90% softwood and 10% hardwood. To learn more, please visit: www.sodra.com.