Södra Reports Record High Profit for Full-Year 2018
"The 2018 result is the best in Södra's history. We were able to meet the strong demand for our products due to extensive investments of approximately SEK 11 billion in our pulp mills and sawmills, and new innovations over the past four years " – Lars Idermark, President and CEO, Södra.
Feb. 14, 2019 - Södra reported that net sales for full-year 2018 rose 18 percent to SEK 24,230 million with operating profit of SEK 4,508 million — the best in Södra's history. The Board proposes a dividend of SEK 1,795 million. Return on capital employed was 24 percent. All business areas delivered a positive result.
Consolidated net sales for full-year 2018 rose 18 percent to SEK 24,230 million (20,518), attributable to a favourable global economy, high demand and higher prices for paper pulp and sawn timber products.
Operating profit for the year totaled SEK 4,508 million (1,917). The operating margin was 19 percent (9). Return on capital employed rose to 24 percent (12) and the equity ratio was 59 percent (56). The Board proposes that the Annual General Meeting on 23 May approve a dividend of SEK 1,795 million (868) to members, corresponding to 41 percent of profit before tax.
2018 was characterised by high and stable demand for Södra's products. Price levels for both market pulp and sawn timber products remained at a favourable level and contributed to the excellent result. Södra's well-invested facilities delivered stable, high-quality volumes and could thereby capitalise on the continued favourable trend in global demand.
“The 2018 result is the best in Södra's history,” said Lars Idermark, President and CEO of Södra. “We were able to meet the strong demand for our products due to extensive investments of approximately SEK 11 billion in our pulp mills and sawmills, and new innovations over the past four years. We also completed efficiency improvements and restructured our operations. Södra has thus strengthened its competitiveness.”
Consolidated net sales for the fourth quarter rose 12 percent to SEK 6,062 million, with year-on-year operating profit of SEK 974 million (530). The operating margin improved to 16 percent (10).
“Growth in the fourth quarter was also strong, but uncertainty increased with some signs of a slowing global economy and turbulence in financial markets,” said Lars Idermark.
In the fourth quarter, Södra acquired Bergviks Skog's forest holding in Latvia for EUR 324 million. The Board decided to invest SEK 100 million in research related to forest growth and productivity.
“Access to fibre is crucial for our industry and the strategic role of forests has increased. We are also seeing a growing demand for forest products as the bioeconomy evolves,” Idermark concluded.
Södra is Sweden's largest forest-owner association, with 52,000 forest owners as its members. Södra is also an international forest industry Group, with operations based on processing its members' forest products, such as softwood and hardwood pulp, and wood products. To learn more, please visit: www.sodra.com.