Strong result and positive market conditions for Södra

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Södra’s operating profit totalled SEK 421 million (400) for the third quarter. The strong results were due, inter alia, to higher prices and stable demand for both paper pulp and sawn timber. During the quarter, decisions were also taken about future-oriented initiatives for increased wood processing and biofuel production.

“Market conditions for forest industry products remained favourable, and higher prices for both market pulp and sawn timber contributed to a strong result. Production levels remained stable at all of Södra’s facilities during the quarter, while Södra is in its most extensive investment phase for decades,” said Lars Idermark, President and CEO.

“We also made decisions about important future initiatives during the period. These relate partly to increased wood processing in cross-laminated timber, and partly to the production of biofuel based on the by-product methanol from the pulp industry,” said Lars Idermark, President and CEO.

Net sales in the third quarter increased 8 percent to SEK 4,763 million (4,417). Operating profit increased 5 percent to SEK 421 million (400). Operating margin was 9 percent (9).

The Södra Skog business area reported operating profit of SEK 12 million (11) and a sales increase of 8 percent in the third quarter.

The Södra Wood business area reported operating profit of SEK 8 million (0). The increased result was mainly due to a positive price development and high demand for sawn timber. Sales decreased 8 percent due to restructuring and a deliberate product portfolio reduction.

The Södra Cell business area reported operating profit of SEK 421 million (377). The improved result was mainly due to strong demand. The new pulp mill in Värö is now fully operational and capacity has increased according to plan. The result was also positively impacted by the continuing high price level for softwood sulphate pulp.

For the January to September period, net sales amounted to SEK 15,105 million (13,915), operating profit to SEK 1,336 million (699) and operating margin to 9 percent (5). Return on capital employed was 11 percent (6) and equity ratio was 55 percent (53).

Quarterly report

July-September 2017 in brief

Net sales4,7634,41715,10513,91518,482
Operating profit before interest, taxes, depreciation and amortisation (EBITDA), SEK million7266582,2631,5192,101
Operating profit (EBIT), SEK million4214001,3366991,005
Profit before income tax, SEK million4023781,276648939
Operating margin, %99955

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