Kemira Oyj’s interim report January-March 2016: revenue and operative EBITDA growth continued
Kemira‘s President and CEO Jari Rosendal: “The year started according to our expectations. The Pulp & Paper segment had a strong first quarter with revenue growth and improvement in profitability. The Municipal & Industrial segment maintained its volume growth, and the Oil & Mining segment took actions to mitigate the challenging market environment while maintaining focus on the long-term opportunities. In January-March the Group’s revenue increased 5% and operative EBITDA 10%, and resulted an improved EBITDA margin of 12.5%.
In the Pulp & Paper segment, revenue in local currencies, excluding acquisitions and divestments, increased 3%. We had a very good growth in APAC and South America. The operative EBITDA margin of the segment improved for the fourth consecutive quarter to 13%. Strong demand for pulp continues and therefore the timing is excellent for the new sodium chlorate plant in Brazil, which successfully started up in March 2016. In addition, we announced in March the investment in the additional sodium chlorate capacity in Finland, which is expected to be operational during the fourth quarter of 2017.
The Oil & Mining segment continued to face a challenging market in the U.S. shale operations. However, the segment was able to improve its operative EBITDA margin from 5% to 9% compared to the fourth quarter of 2015, which is a good achievement in this market. We have taken actions to protect our existing business and have maintained discipline in cost management. We continue to invest in new applications and promising growth areas, such as Chemical Enhanced Oil Recovery.
The Municipal & Industrial segment
In the Municipal & Industrial segment, the volume growth continued at 3%, while sales prices declined leading to a 1% revenue growth in local currencies, excluding acquisitions and divestments. We are overcoming the temporary cost increase in North America, which was due to the disruption caused by a closure of a supplier’s site in the fourth quarter of 2015. The operative EBITDA margin improved sequentially and was almost 13%.
We continue to grow and focus on improved profitability through operational improvements, leveraging growth, and capturing synergies. After the first quarter, Kemira is on track to increase its revenue and operative EBITDA in 2016.”
In the picture: Jari Rosendal, Kemira’s President and CEO