BillerudKorsnäs report – January–December 2017
Comments by BillerudKorsnäs’ CEO Petra Einarsson:
Stable results
“Our strong position in a growing market is enabling us to continue reporting high growth and stable earnings. Strong demand is continuing, resulting in increased sales, which are up by just over 3 percent on the previous year. Production volumes are at record-high levels, despite recurring availability problems. Of course, we are not satisfied with being unable to meet the demand that exists, and we are therefore now intensifying our action plan to boost production stability. Going forward, ensuring operating excellence will be one of my focal areas. Our investments for long-term growth have proved to be more expensive than expected. However, the projects are continuing to progress and I believe our initiatives, both to meet customer demand and to increase operational stability, will generate results over the next few years”
The result
“EBITDA for the full year rose by 4% to SEK 3 760 million. Sales volumes were unchanged compared with the previous year, while net sales increased by 3% owing mainly to increased prices and a positive currency impact. Variable costs increased, in part because of external pulp purchases at the start of the year relating to the rebuild of Rockhammar.
All business areas are continuing to deliver stable earnings. Despite inadequate Consumer Board production availability, growth was 3%, which is in line with the Group’s overall target. Managed Packaging, within Corrugated Solutions, is continuing to deliver strong sales growth – up 50% on the previous year. Packaging Paper delivered record earnings, despite lower capacity owing to the relocation of the MG machine from Tervasaari to Skärblacka”.
Market outlook
“The strong performance in the market by all business areas is expected to continue. We are seeing favourable order levels and opportunities for further price increases, particularly in Packaging Paper and Corrugated Solutions.
The positive picture is reinforced by the fact that we are correctly positioned, with a broad offering of innovative and sustainable packaging and solutions. Demand for a comprehensive offering in which the material plays a key role is growing. Packaging is gaining an increasingly important role in many brand owners’ efforts to make their products more competitive. This continues to give us great confidence in our products and our development”.
Strategy
“Efficiency is a cornerstone of our strategy. Our approach to efficiency is about doing things right, and having efficient processes and practices. It is our customers who principally determine what the right things to do are. That’s why we are increasingly focusing on developing and harmonising our working practices by strengthening group-wide functions within our production organisation. This relates in particular to minimising production disruptions and ensuring our products maintain consistently high quality.
Another important element relates to developing new business models and progressing along the value chain. Managed Packaging is expected to deliver strong sales growth, both through new customers and increased volumes from existing customers.
