Strong 2015 for Södra, high dividends and continued investment in the future
Södra’s operating profit for 2015 increased to SEK 2,162 million (1,516) and the Board is proposing a profit distribution of SEK 1,002 million (553) to members. At the same time, Södra’s investment programme is continuing and an additional SEK 1 billion will be invested in the pulp mill at Mörrum.
“2015 was another good year for Södra. It is pleasing to report an historically strong result of SEK 2,162 million (1,516) and that the Board can therefore propose substantial dividends. The forest economy was stable, our production volumes were high, exchange rates were favourable and our operations became more efficient. However, 2016 will prove a challenging year with the startup of a virtually new pulp mill, the continuation of a programme of change for sawn and planed timber, and a fragile global market,” said Lars Idermark, President and CEO.
“We now have a leading and highly efficient mill operation that secures markets for our owners’ forest raw material, as well as the Group’s long-term potential to be successful in the face of global competition. We will now invest an additional SEK 1 billion in our pulp mill at Mörrum to meet customer demands for high-grade pulp,” Idermark added. Net sales for 2015 increased to SEK 18.3 billion (17.3), of which SEK 6.1 billion (5.9) was generated in the third four-month period. Operating profit in the third four-month period totalled SEK 502 million (504).
Due to this positive result, the Board is proposing a profit distribution of SEK 1,002 million (553) to members, corresponding to 48 percent of profit before tax. The distribution comprises a dividend of 15 percent (6) on contributed capital, totalling SEK 439 million (170), a dividend of 10 percent (8) on wood deliveries, totalling SEK 436 million (323), and SEK 127 million (60) as a bonus issue. In addition to the above, a dividend of SEK 10 million (10) will be paid on subordinated debentures as contracted.
Södra already has an ongoing investment programme of about SEK 5 billion, most of which pertains to the expansion of the Värö pulp mill. The Board of Södra has now decided to invest a further SEK 1 billion in the mill at Mörrum. This investment will include a new evaporator and modernisation of the brown stock washing system in the dissolving pulp line, where pulp for the textile industry is produced. A new evaporator will make it possible to increase the production rate, as well as deliveries of energy products, such as electricity, district heating and biofuels. The new investment will increase production capacity by 45,000 tonnes, bringing the total production of paper pulp and dissolving pulp at Mörrum to 470,000 tpy. Following the expansion, capacity at Värö will amount to 700,000 tonnes. Capacity at Mönsterås will be 750,000 tonnes.
In the picture: Lars Idermark, Sodra President and CEO.