STOCKHOLM, Feb 09, 2017 /PRNewswire/ --
STRONG ANNUAL PROFIT ONCE AGAIN
- Profit after financial items amounted to SEK 163 million (259) for full year 2016 and earnings per share were SEK 0.84 (1.46).
- Net turnover for the fourth quarter of 2016 was SEK 441 million (429), an increase of 3%. Delivery volumes in the fourth quarter rose by 2% compared with fourth quarter 2015.
- Like last year, fourth quarter earnings were impacted by the annual maintenance shutdown at Vallvik Mill. The loss of production and the direct cost of the shutdown decreased earnings for the fourth quarter by approx. SEK 55 million. The loss after financial items for the fourth quarter was SEK 7 million (profit 1).
- The list price for NBSK pulp over the fourth quarter was 1% lower in USD, but 5% higher in SEK, compared with fourth quarter 2015. For full year 2016, however, the list price was 6% lower in USD and 5% lower in SEK than in 2015.
- Investments in the Agenda 500 development programme continue to increase capacity. Investments in 2016 totalled SEK 278 million (103).
- A new annual production record for Rottneros Mill and for the Group in the current structure.
- In the fourth quarter, a previous write-down recognised in 2011 relating to the grinding line at Rottneros Mill was reversed and certain write-downs were recorded, with a net positive effect of SEK 14 million on the quarterly earnings.
- In February 2017, the Board of Directors decided on an extended purification plant at Rottneros Mill, as part of Agenda 500. The investment of SEK 84 million is planned to be commissioned in 2018.
- The Board of Directors proposes an ordinary dividend of SEK 0.30 per share and an extra dividend of SEK 0.10 per share.
COMMENTS BY THE PRESIDENT
Strong year for earnings
I took over as President and CEO of Rottneros on 1 September and have the privilege of leading the Group on the well-worn path to achieving sustainable and profitable growth and becoming more efficient. I am pleased to note that full year 2016 was yet another strong year in terms of earnings. Because external factors such as prices and electricity costs were not as favourable as last year, we were unable to match last year's results. But with a return on capital employed of 15 per cent, we remain at the top among comparable pulp producing companies. Rottneros has a strong balance sheet and remained debt-free at year-end, which sets a good foundation for the continued development in line with our long-term plan
The fourth quarter is usually a weak quarter for Rottneros because of the annual maintenance shutdown at Vallvik Mill along with the commissioning of new investments, and this year was no exception. The startup process at Vallvik was more problematic than planned, which had a negative impact on delivery volumes, especially in December. Operating loss for the quarter was SEK 4 million, to be compared with a profit of SEK 3 million in the
The pulp market is expected to continue to be stable and demand for our products is good. The published NBSK pulp price during the year has fluctuated around USD 800 per tonne, +/- USD 10. The price trend for our mechanical pulps during the latter part of the year has been positive, especially in Asia. The development of the USD exchange rate continues to be an uncertain factor.
We remain focused on our primary objective of increasing the Group's volumes by increasing capacity and productivity. The investments in our Agenda 500 long-term plan are proceeding according to plan in both mills. The first step in streamlining CTMP production at Rottneros Mill was completed during the fall and has produced positive effects. Rottneros Mill set a new annual record for production at 157 thousand tonnes. Overall, projects amounting to SEK 270 million were concluded within the Agenda 500 framework in 2016.
In the fourth quarter Rottneros signed a debt financing agreement totalling SEK 120 million that will be used for investments in the Group's two mills within the Agenda 500 investment programme.
It is important that our ambitious investment programme is carried out by an efficient organisation with shared values and a strong team spirit. The continued development of clear leadership with good communication skills, which inspires commitment and motivation and develops employee empowerment, is fundamental to my aspirations. We are therefore working intensively with both skills and leadership development so that we will be among the very best in these areas. Shared values based on a clear set of core values that are strongly embraced by our employees are crucial for delivering added value to our customers.
The earlier announced EU project PULPACKTION started on 1 October 2016, with Rottneros Packaging as the coordinator. The goal is to develop completely bio-based packaging at a competitive price, thereby contributing to more sustainable development in the packaging industry.
I would like to thank all of our employees, customers, shareholders and suppliers for an inspiring and productive collaboration since I took over
on 1 September.
In conclusion, Rottneros is continuing on its journey towards becoming a sustainable company in a broad sense with respect to the environment, our employees and our financial strength. While we can clearly see the effects of what we have accomplished, much remains to be done. I look forward to an exciting year.
For full report, please see attached file.
This information is information that Rottneros AB is obliged to publish under the EU Market Abuse Regulation and the Securities Market Act. This information was submitted for publication, through the agency of the contact persons set out below, on 9 February 2017 at 8:00 a.m. A Swedish and an English version of this report have been drawn up. The Swedish version shall prevail in the event of differences between the two reports.
For further information, please contact:
CEO and President,
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The following files are available for download:
ROTTNEROS AB YEAR-END REPORT JANUARYâ€"DECEMBER 2016
SOURCE Rottneros AB