Stora Enso Oyj Interim Report January-March 2021
Back on track
Improving performance and market conditions
- Sales increased by 3.1% to EUR 2 276 (2 207) million, due to higher deliveries and prices.
- Operational EBIT increased to
EUR 328(180) million, due to lower costs.
- Operational EBIT margin increased to 14.4% (8.1%).
- Operating profit (IFRS) decreased to
EUR 161(262) million.
- EPS was
EUR 0.18(0.19) and EPS excl. fair valuations (FV) was EUR 0.22(0.11).
- Cash flow from operations amounted to EUR 185 (146) million. Cash flow after investing activities was
EUR -9(-32) million.
- The net debt to operational EBITDA ratio was 2.3 (2.3).
- Operational ROCE excluding Forest division increased to 12.0% (7.8%)
Strategy implementation update
Stora Ensois planning to permanently close down pulp and paper production at Kvarnsveden and Veitsiluoto mills, as announced on 20 April.
- TreeToTextile, a joint venture where
Stora Ensoholds a 25% share, invests EUR 35 millionin a demonstration plant for sustainable textile fiber.
- Dissolving pulp production at
Enocell Millwill be discontinued during 2021, and the mill will be producing other pulp grades.
- The conversion project at
Oulu Millwas completed and production of krafliner is in a ramp-up phase.
- The US-based
Virdiaoperations were shut down in Q1/2021.
- A feasibility study is ongoing regarding a possible expansion of the pulp and board production at
Skoghall Millin Sweden.
Preventive Covid-19 actions
Protecting employees and contractors health and safety during the pandemic has been
The global economy is recovering from the impacts of the pandemic and the demand for
Change % Q1/21-Q1/20
Change % Q1/21-Q4/20
Operational EBIT margin
Operating profit (IFRS)
Profit before tax excl. IAC and FV
Profit before tax (IFRS)
Net profit for the period (IFRS)
Net interest-bearing liabilities
Operational ROCE excl. Forest division, %
Earnings per share (EPS) excl. FV, EUR
EPS (basic), EUR
Net debt/last 12 months' operational EBITDA ratio
Average number of employees
"Global trade has rebounded faster than expected this year and the economic recovery in
For the year's first quarter I am pleased to deliver yet another solid result, and we are getting back on track with many of our financial targets. Our operational EBIT was up considerably year on year, excluding Paper it nearly doubled to reach over
There is a positive market sentiment for all our key business areas, except for our Paper division, which continues to suffer from an accelerated structural decline. The rebound of our growth businesses is a proof point of our strategic direction and ambitions. It is especially rewarding to see our ability to adapt, to take advantage of our opportunities and innovate despite the unique market conditions.
Our packaging divisions are both performing well. In Packaging Materials, we see strong demand for consumer and container board. In Packaging Solutions, higher European volumes in combination with a recovering
Our Forest division has experienced advantageous harvesting conditions this winter, ensuring efficient wood supply to our Nordic and pan-European production units. This in turn ensures pulp availability to support the uptick in demand across our business. Recovering pulp prices, combined with strong production and deliveries, improved the profitability of our Biomaterials division.
The paper market continues to suffer from demand decline and the resulting overcapacity, which unfortunately has caused us to initiate a plan to permanently close down two of our paper mills: Kvarnsveden in
Our transformation investment in Oulu, from paper to kraftliner, is progressing well. Since the January launch, the ramp up is proceeding ahead of plan. We have customer deliveries and there is strong market demand. I'm also very pleased that we will be able to reach EBITDA breakeven already in the third quarter this year. When fully ramped up, premium kraftliner grades from Oulu will strengthen our position in a growing packaging market. This conversion is a prime example of where we are heading as a company. Our focus is increasingly on high-margin markets where we already have a strong foothold. One such important market is packaging, in addition to wooden building solutions and new biomaterials innovations. These three areas are core for our future growth with our renewable materials.
Another aspect of our updated strategy has been to identify the product segments with the best opportunities for leading market positions, growth and profitability. Consequently, we have decided to exit the market for dissolving pulp for viscose production globally. Our current global market share is very small, and we do not see that we will be able to grow that position. The price differentiation between dissolving pulp and market pulp is small and does not motivate the increase in complexity for our pulp product portfolio and our production costs. We will continue innovating for a better and more sustainable technology for biobased textiles. TreeToTextile is such a venture where we, together with other leading companies, have invested in what we believe will become a ground-breaking production technology for sustainable textiles.
Moving forward, our focus remains on keeping our employees safe from the ongoing pandemic and executing on our updated strategy in order to reach the financial targets as disclosed last year. Moreover, we want to show leadership in innovation and be a constructive partner to governments around the world and the
The renewable future grows in the forest."Webcast and conference call for analysts, investors and media today at 14.00 EEST
The webcast and conference call for analysts, investors and media will take place at 14.00-15.00 EEST (13.00 CEST, 12.00
Those analysts and investors who wish to ask questions should join the conference call (details below). All participants can follow the presentation over the webcast.
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This release is a summary of
Ulrika LiljaEVP, Communications and Marketingtel. +46 72 221 9228
SVP, Investor Relations
tel. +358 40 763 8767
Part of the bioeconomy,
For further information, please contact:
EVP, Communications and Marketing
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STORAENSO RESULTS Q121 ENG