2013-02-05 12:00:02 CET
2013-02-05 12:00:24 CET
REGULATED INFORMATION
Stora Enso Oyj - Financial Statement Release
Stora Enso Fourth Quarter and Full Year Results 2012
Strong cash flow, deteriorating paper markets, proposed dividend EUR 0.30
Helsinki, Finland, 2013-02-05 12:00 CET (GLOBE NEWSWIRE) -- STORA ENSO OYJ
ANNUAL FINANCIAL STATEMENT RELEASE 5 February 2013 at 13.00 EET
Q4 2012 (compared with Q4 2011)
-- Operational EBIT EUR 10 million higher than in Q4 2011 at EUR 155 (EUR 145)
million mainly due to lower costs, EUR 20 million lower than in Q3 2012
(EUR 175) million driven by seasonally higher fixed costs.
-- Strong cash flow from operations at EUR 471(EUR 302) million and strong
liquidity at EUR 1 845 (EUR 1 134) million.
-- Operational ROCE 7.1% (6.7%).
Full Year 2012 (compared with 2011)
-- Operational EBIT EUR 248 million lower than in 2011 at EUR 618 (EUR 867)
million mainly due to lower sales prices.
-- Improved cash flow from operations at EUR 1 253 (EUR 1 034) million.
-- Ratio of net debt to the last twelve months' operational EBITDA 2.5 (2.1).
Outlook and actions
-- Q1 2013 sales expected to be at roughly similar level but operational EBIT
in the order of magnitude one-third lower than in Q4 2012 due to
deterioration in European paper and Building and Living markets.
-- Skoghall and Ostrołęka investments started up as planned.
-- Restructuring plans including 475 000 tonnes of newsprint capacity
reduction and annual cost savings of EUR 54 million announced.
Summary of Fourth Quarter Results
Q4/12 2012 Q4/11 2011
------------------------------------------------------------------------------
Sales EUR million 2 727.0 10 814.8 2 681.6 10 964.9
Operational EBITDA EUR million 272.8 1 082.6 242.9 1 308.0
Operational EBIT* EUR million 155.0 618.3 144.9 866.7
Operating profit (IFRS) EUR million 251.1 689.0 169.5 759.3
Profit before tax excl. NRI EUR million 83.5 318.5 141.4 639.1
Profit before tax EUR million 203.7 481.7 110.3 420.9
Net profit excl. NRI EUR million 88.9 263.9 80.5 498.2
Net profit EUR million 265.5 490.4 100.2 342.2
EPS excl. NRI EUR 0.11 0.33 0.10 0.63
EPS EUR 0.33 0.61 0.12 0.43
CEPS excl. NRI EUR 0.30 1.07 0.28 1.33
Operational ROCE % 7.1 7.1 6.7 10.0
*Operational EBIT comprises the operating profit excluding NRI and fair
valuations of the segments and Stora Enso's share of the operating profit
excluding NRI and fair valuations of its equity accounted investments (EAI).
Fair valuations include equity incentive schemes, synthetic options net of
realised and open hedges, CO2 emission rights and valuations of biological
assets related to forest assets in EAI.
Stora Enso Deliveries and Production
Q4/12 Q3/12 Q4/11 2012 2011 Change % Change Change
Q4/12-Q4 % %
/11 Q4/12-Q 2012-20
3/12 11
--------------------------------------------------------------------------------
----------------
Paper and board 2 569 2 576 2 606 10 268 10 330 -1.4 -0.3 -0.6
deliveries (1
000 tonnes)
Paper and board 2 561 2 610 2 512 10 357 10 346 2.0 -1.9 0.1
production (1
000 tonnes)
Wood products 1 175 1 129 1 177 4 750 5 072 -0.2 4.1 -6.3
deliveries (1
000 m3)
Market pulp 284 267 289 1 058 1 130 -1.7 6.4 -6.4
deliveries (1
000 tonnes)*
Corrugated 279 275 273 1 097 1 018 2.2 1.5 7.8
packaging
deliveries
(million m2)
----------------------------------------------------------------
* Stora Enso's net market pulp position was about 1 million tonnes for 2012.
Key Figures
EUR Q4/12 Q3/12 Q4/11 2012 2011 Change Change Change
million % % %
Q4/12- Q4/12- 2012-2
Q4/11 Q3/12 011
--------------------------------------------------------------------------------
Sales 2 727.0 2 694.1 2 681.6 10 814.8 10 964.9 1.7 1.2 -1.4
Operation 272.8 299.6 242.9 1 082.6 1 308.0 12.3 -8.9 -17.2
al EBITDA
Operation 155.0 174.7 144.9 618.3 866.7 7.0 -11.3 -28.7
al EBIT
Operation 5.7 6.5 5.4 5.7 7.9 5.6 -12.3 -27.8
al EBIT
margin,
%
Operating 251.1 161.3 169.5 689.0 759.3 48.1 55.7 -9.3
profit
(IFRS)
Operating 9.2 6.0 6.3 6.4 6.9 46.0 53.3 -7.2
margin
(IFRS),
%
Profit 83.5 102.2 141.4 318.5 639.1 -40.9 -18.3 -50.2
before
tax
excl.
NRI
Profit 203.7 102.2 110.3 481.7 420.9 84.7 99.3 14.4
before
tax
Net 88.9 81.3 80.5 263.9 498.2 10.4 9.3 -47.0
profit
for the
period
excl.
NRI
Net 265.5 81.3 100.2 490.4 342.2 165.0 226.6 43.3
profit
for the
period
Capital 209.4 130.5 230.7 556.3 453.3 -9.2 60.5 22.7
expendit
ure
Depreciat 150.1 149.3 141.0 583.0 554.9 6.5 0.5 5.1
ion and
impairme
nt
charges
excl.
NRI
Operation 7.1 8.0 6.7 7.1 10.0 6.0 -11.3 -29.0
al ROCE,
%
Earnings 0.11 0.10 0.10 0.33 0.63 10.0 10.0 -47.6
per
share
(EPS)
excl.
NRI, EUR
EPS 0.33 0.10 0.12 0.61 0.43 175.0 230.0 41.9
(basic),
EUR
Cash 0.30 0.29 0.28 1.07 1.33 7.1 3.4 -19.5
earnings
per
share
(CEPS)
excl.
NRI, EUR
CEPS, EUR 0.45 0.29 0.30 1.28 1.16 50.0 55.2 10.3
Return on 18.2 5.7 6.7 8.3 5.6 171.6 219.3 48.2
equity
(ROE), %
Debt/equi 0.48 0.52 0.47 0.48 0.47 2.1 -7.7 2.1
ty ratio
Net 2.5 2.8 2.1 2.5 2.1 19.0 -10.7 19.0
debt/las
t twelve
months'
operatio
nal
EBITDA
Equity 7.33 7.27 7.45 7.33 7.45 -1.6 0.8 -1.6
per
share,
EUR
Equity 42.9 42.7 45.8 42.9 45.8 -6.3 0.5 -6.3
ratio, %
Average 28 331 29 167 29 639 28 777 27 958 -4.4 -2.9 2.9
number
of
employee
s
Average
number
of
shares
(million
)
periodic 788.6 788.6 788.6 788.6 788.6
cumulativ 788.6 788.6 788.6 788.6 788.6
e
cumulativ 788.6 788.6 788.6 788.6 788.6
e,
diluted
Operational EBIT comprises the operating profit excluding NRI and fair
valuations of the segments and Stora Enso's share of the operating profit
excluding NRI and fair valuations of its equity accounted investments (EAI).
Fair valuations include equity incentive schemes, synthetic options net of
realised and open hedges, CO2 emission rights and valuations of biological
assets related to forest assets in EAI.
NRI = Non-recurring items. These are exceptional transactions that are not
related to normal business operations. The most common non-recurring items are
capital gains, additional write-downs or reversals of write-downs, provisions
for planned restructuring and penalties. Non-recurring items are normally
specified individually if they exceed one cent per share.
Reconciliation of Operational Profitability
EUR million Q4/12 Q3/12 Q4/11 2012 2011 Change Change Change
% % %
Q4/12-Q Q4/12-Q 2012-2
4/11 3/12 011
--------------------------------------------------------------------------------
Operational 272.8 299.6 242.9 1 082.6 1 308.0 12.3 -8.9 -17.2
EBITDA
Equity 32.3 24.4 43.0 118.7 113.6 -24.9 32.4 4.5
accounted
investments
(EAI),
operational
*
Depreciation -150.1 -149.3 -141.0 -583.0 -554.9 -6.5 -0.5 -5.1
and
impairment
excl. NRI
Operational 155.0 174.7 144.9 618.3 866.7 7.0 -11.3 -28.7
EBIT
Fair -13.6 -13.4 45.6 -58.9 -27.5 -129.8 -1.5 -114.2
valuations
and
non-operati
onal items**
Non-recurrin 109.7 - -21.0 129.6 -79.9 n/m 100.0 262.2
g items
-------------------------------------------------------------------
Operating 251.1 161.3 169.5 689.0 759.3 48.1 55.7 -9.3
Profit
(IFRS)
-------------------------------------------------------------------
* Group's share of Operational EBIT of EAI.
** Fair valuations and non-operational items include equity incentive schemes,
synthetic options net of realised and open hedges, CO2 emission rights,
valuations of biological assets related to forest assets in equity accounted
investments (EAI) and Group's share of tax and net financial items of EAI.
Q4/2012 Results (compared with Q4/2011)
Breakdown of Sales Change Q4/2011 to Q4/2012
Sales
-------------------------------------------
Q4/11, EUR million 2 681.6
-------------------------------------------
Price and mix, % -2
Currency, % 1
Volume, % -
Other sales*, % 1
-------------------------------------------
Total before structural changes, % -
Structural change**, % 2
Total, % 2
Q4/12, EUR million 2 727.0
===========================================
* Wood, energy, paper for recycling, by-products etc.
** Asset closures, major investments, divestments and acquisitions
Operational EBIT at EUR 155 million was EUR 10 million higher than a year ago.
This represents an operational EBIT margin of 5.7% (5.4%).
Clearly lower sales prices in local currencies, especially for paper products,
had a negative impact of EUR 48 million on operational EBIT. Higher deliveries
and production of packaging grades more than offsetting lower deliveries of
paper, market pulp and sawn goods increased operational EBIT by EUR 22 million.
Paper and board production was curtailed by 9% (13%) and sawnwood production by
5% (15%) to manage supply.
The overall net impact of variable costs in local currencies was a positive EUR
42 million, mainly due to lower prices for corrugated raw material and paper
for recycling. Some sawlog prices were higher than last year, mainly due to
limited log availability in Central Europe. The operational EBIT from the
equity accounted investments was lower than a year ago, and in particular, the
operational EBIT from the Nordic forest equity accounted investments was EUR 8
million lower.
The average number of employees in the fourth quarter of 2012 was 1 300 lower
than a year earlier at 28 300 as the number of employees decreased in all
geographical areas.
Fair valuations and non-operational items decreased by EUR 60 million mainly
due to the higher valuation of biological assets in Bergvik Skog and Veracel a
year ago. The Group's share of the net financial expenses of the EAI increased
by EUR 14 million in the fourth quarter of 2012. The Group recorded
non-recurring items (NRI) with a positive net impact of approximately EUR 110
million on operating profit, a positive impact of approximately EUR 11 million
on financial items and a positive impact of approximately EUR 56 million on
income tax in its fourth quarter 2012 results. The impact of the NRI on
operating profit was mainly due to a positive net impact of approximately EUR
65 million as a result of fixed asset impairment testing, a negative impact of
approximately EUR 43 million due to the plans to restructure operations in all
Business Areas and a positive impact of approximately EUR 69 million relating
to the Group's share of the effect of the new tax rate on the equity accounted
investment Bergvik Skog. The impact of the NRI on income tax was also mainly
due to this tax rate change in Sweden.
Net financial items were EUR 12 million less negative than in the previous
year, mainly due to the one-time EUR 11 million gain from the settlement of the
NewPage lease guarantee. The net interest expenses increased by EUR 12 million
due to higher gross debt levels. A non-recurring EUR 10 million write-down of
loan receivables was recorded in the fourth quarter of 2011.
Breakdown of Capital Employed Change Q4/2011 to Q4/2012
Group capital employed was EUR 8 633 million on 31 December 2012, a net
decrease of EUR 73 million on a year earlier.
Capital Employed
------------------------------------------------------------------------------
Q4/11, EUR million 8 706
------------------------------------------------------------------------------
Equity accounted investments 110
Net tax liabilities 140
Available-for-sale: operative (mainly PVO) -190
Net liabilities in defined benefit plans -130
Operative working capital and other interest-free items, net -50
Translation difference 50
Other changes -3
Q4/12, EUR million 8 633
==============================================================================
The operational return on capital employed was 7.1% (6.7%), excluding the
ongoing strategic investments in Biomaterials and Renewable Packaging it would
have been 8.6 % (7.6%).
January-December 2012 Results (compared with January-December 2011)
Breakdown of Sales Change 2011 to 2012
Sales
--------------------------------------------
2011, EUR million 10 964.9
--------------------------------------------
Price and mix, % -2
Currency, % 1
Volume, % -1
Other sales*, % -
--------------------------------------------
Total before structural changes, % -2
Structural change**, % 1
Total, % -1
2012, EUR million 10 814.8
============================================
* Wood, energy, paper for recycling, by-products etc.
** Asset closures, major investments, divestments and acquisitions
Operational EBIT decreased by EUR 248 million to EUR 618 million. The
operational EBIT margin was 5.7% (7.9%).
Significantly lower sales prices in local currencies for paper, pulp and to
some extent some packaging grades decreased operational EBIT by EUR 262
million. Lower sales volumes in paper, pulp and sawn goods, partly offset by
higher production and sales volumes for packaging grades, decreased operational
EBIT by EUR 18 million, but lower variable costs, mainly for corrugated raw
material, paper for recycling and pulp, increased operational EBIT by EUR 67
million. Fixed costs were similar to the previous year as higher personnel
costs were compensated by lower maintenance costs and actions to decrease the
overall fixed costs. Exchange rates had a negative net impact on sales and
costs of EUR 28 million after hedges.
Net financial items were EUR 131 million less negative than in the previous
year, mainly due to the one-time EUR 128 million loss from the provision
related to the NewPage lease guarantee recorded in 2011, whereas a EUR 34
million gain was recorded on the reversal of provisions and settlement in 2012.
The net interest expenses increased by EUR 49 million due to higher gross debt
levels. Net foreign exchange losses decreased by EUR 16 million.
Q4/2012 Results (compared with Q3/2012)
Sales were similar to the previous quarter at EUR 2 727 million. Operational
EBIT was EUR 20 million lower than in the previous quarter at EUR 155 million.
Fixed costs were higher due to seasonality and higher maintenance activity,
partly offset by lower variable costs.
Capital Structure
EUR million 31 Dec 30 Sep 30 Jun 31 Mar 31 Dec
12 12 12 12 11
--------------------------------------------------------------------------------
Operative fixed assets 6 021.1 6 001.2 5 879.3 6 032.0 6 120.4
Equity accounted investments 1 965.1 1 977.5 1 947.9 1 925.9 1 913.1
Operative working capital, net 1 460.1 1 641.5 1 587.3 1 529.6 1 504.6
Non-current interest-free -592.2 -461.1 -453.8 -467.6 -486.1
items, net
------------------------------------------------
Operating Capital Total 8 854.1 9 159.1 8 960.7 9 019.9 9 052.0
Net tax liabilities -221.3 -335.0 -313.7 -315.0 -346.4 ------------------------------------------------
Capital Employed 8 632.8 8 824.1 8 647.0 8 704.9 8 705.6
================================================
Equity attributable to owners 5 784.5 5 735.0 5 560.9 5 906.7 5 872.7
of the Parent
Non-controlling interests 91.5 89.3 91.5 86.5 87.1
Net interest-bearing 2 756.8 2 999.8 2 994.6 2 711.7 2 745.8
liabilities
------------------------------------------------
Financing Total 8 632.8 8 824.1 8 647.0 8 704.9 8 705.6
================================================
Financing Q4/2012 (compared with Q3/2012)
Cash flow from operations was EUR 471 (EUR 312) million. Cash flow after
investing activities was EUR 271 (EUR 120) million. Interest-bearing net
liabilities of the Group decreased by EUR 243 million to EUR 2 757 million due
to good cash flow generation during the fourth quarter driven by working
capital management.
Total unutilised committed credit facilities were unchanged at EUR 700 million,
and cash and cash equivalents net of overdrafts remained strong at EUR 1 845
million, which is EUR 145 million more than for the previous quarter. In
addition, Stora Enso has access to various long-term sources of funding up to
EUR 600 million.
The operational EBITDA margin for the last twelve months was 10.0% (9.8%). The
ratio of net debt to the last twelve months' operational EBITDA was 2.5 (2.8).
The debt/equity ratio at 31 December 2012 was 0.48 (0.52). The decrease is
primarily due to the EUR 262 million net profit attributable to owners of the
parent company for the fourth quarter of 2012 and the EUR 243 million decrease
in net interest-bearing liabilities.
Cash Flow
EUR million Q4/12 Q3/12 Q4/11 2012 2011 Change Change Change
% % %
Q4/12-Q Q4/12-Q 2012-2
4/11 3/12 011
--------------------------------------------------------------------------------
Operating 251.1 161.3 169.5 689.0 759.3 48.1 55.7 -9.3
profit
Depreciation 80.2 147.4 51.0 491.3 492.0 57.3 -45.6 -0.1
and other
non-cash
items
Change in 139.7 3.7 81.8 72.4 -217.0 70.8 n/m 133.4
working
capital
-------------------------------------------------------------------
Cash Flow 471.0 312.4 302.3 1 252.7 1 034.3 55.8 50.8 21.1
from
Operations
Cash spent -183.8 -155.0 -187.0 -560.7 -409.6 1.7 -18.6 -36.9
on fixed
and
biological
assets
Acquisitions -16.0 -37.0 -41.5 -114.5 -128.6 61.4 56.8 11.0
of equity
accounted
investments
-------------------------------------------------------------------
Cash Flow 271.2 120.4 73.8 577.5 496.1 267.5 125.2 16.4
after
Investing
Activities
-------------------------------------------------------------------
Capital Expenditure for January-December 2012
Additions to fixed and biological assets in 2012 totalled EUR 556 million,
which is 95% of depreciation in the same period. The equity injection into
Montes del Plata, a joint venture in Uruguay, was EUR 115 million in 2012.
Investments in fixed assets and biological assets had a cash outflow impact of
EUR 561 million in 2012.
The main projects ongoing during 2012 were Montes del Plata, the Ostrołęka
containerboard machine and the Skoghall woodyard investment.
Capital Expenditure, Equity injections and Depreciation Forecast 2013
EUR million Forecast 2013
----------------------------------
Capital expenditure 350-400*
Equity injections 110-130
----------------------------------
Total 460-530
Depreciation 600-620
----------------------------------
* Excluding the capital expenditure in 2013 for the board and pulp mills
project in Guangxi, China.
Capital expenditure in 2013 for the board and pulp mills project in Guangxi,
China will be confirmed when the project approvals have been given and the
construction and production schedule has been updated.
Near-term Outlook
In the first quarter of 2013 Group sales are expected to be at roughly similar
level but operational EBIT in the order of magnitude one-third lower than in
the fourth quarter of 2012 due to deterioration in European paper and Building
and Living markets. The impact of the restructuring plans announced today would
start to have an impact on the Group's results from the second half of 2013
onwards. In Biomaterials, Veracel Pulp Mill will take its annual maintenance
stoppage during the quarter.
Segments Q4/12 compared with Q4/11
Printing and Reading
Printing and Reading's wide offering serves publishers, advertisers, printing
houses, merchants, office equipment manufacturers and office suppliers, among
others. Printing and Reading produces newsprint, SC paper, coated paper grades
and office paper.
EUR Q4/12 Q3/12 Q4/11 2012 2011 Change Change Change
million % % %
Q4/12-Q Q4/12-Q 2012-20
4/11 3/12 11
--------------------------------------------------------------------------------
Sales 1 194.5 1 226.8 1 283.8 4 839.3 5 022.0 -7.0 -2.6 -3.6
Operatio 128.3 119.4 123.3 488.6 547.6 4.1 7.5 -10.8
nal
EBITDA
Operatio 58.0 51.1 55.6 218.1 285.3 4.3 13.5 -23.6
nal EBIT
% of 4.9 4.2 4.3 4.5 5.7 14.0 16.7 -21.1
sales
Operatio 7.7 6.7 7.2 7.2 9.2 6.9 14.9 -21.7
nal
ROOC,
%*
Paper 1 791 1 794 1 886 7 130 7 219 -5.0 -0.2 -1.2
deliver
ies, 1
000 t
Paper 1 809 1 789 1 811 7 210 7 228 -0.1 1.1 -0.2
product
ion, 1
000 t
-----------------------------------------------------------------------
* Operational ROOC = 100% x Operational EBIT/Average operating capital
-- Slightly lower sales prices in local currencies and somewhat lower paper
deliveries were offset by lower variable costs, especially for paper for
recycling, and lower maintenance costs.
-- It is planned to shut down two newsprint paper machines with 475 000 tonnes
of capacity and reorganise customer service. Annual cost savings targeted
EUR 24 million.
-- PM 1 at Hylte Mill in Sweden was permanently shut down at the end of 2012.
-- Curtailments to adjust to weakening demand are planned for the first
quarter in 2013 to minimise costs and safeguard cash flow.
Markets
Produc Market Demand Q4/12 Demand Q4/12 Price Q4/12 Price Q4/12
t compared with compared with compared with compared with
Q4/11 Q3/12 Q4/11 Q3/12
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Paper Europe Weaker Stronger Slightly lower Stable
Biomaterials
Biomaterials offers a variety of pulp grades to meet the demands of paper,
board and tissue producers. Pulp is an excellent raw material: it is made from
renewable resources in a sustainable manner, and has many different uses.
EUR Q4/12 Q3/12 Q4/11 2012 2011 Change % Change % Change %
million Q4/12-Q4/ Q4/12-Q3 2012-201
11 /12 1
--------------------------------------------------------------------------------
Sales 256.6 267.6 255.4 1 012.4 1 092.0 0.5 -4.1 -7.3
Operationa 33.2 37.5 26.3 98.9 200.4 26.2 -11.5 -50.6
l EBITDA
Operationa 27.7 32.5 27.2 82.1 169.2 1.8 -14.8 -51.5
l EBIT
% of sales 10.8 12.1 10.6 8.1 15.5 1.9 -10.7 -47.7
Operationa 7.7 9.0 7.7 5.7 12.0 0.0 -14.4 -52.5
l ROOC, %*
Pulp 471 467 465 1 836 1 851 1.3 0.9 -0.8
deliverie
s, 1 000 t
---------------------------------------------------------------------
* Operational ROOC = 100% x Operational EBIT/Average operating capital
-- Average market pulp prices were similar to a year ago despite lower
softwood pulp prices, which were offset by the improved product mix
(hardwood and dissolving pulp). The lower profits from equity accounted
investments were offset by lower fixed costs and slightly higher volumes.
-- Operating efficiency was high in all Biomaterials mills despite a fire that
caused some disruptions at Skutskär Mill in Sweden.
-- Negotiations regarding
efficiency improvement actions at Skutskär Mill to reduce costs and improve
the mill's competitiveness in response to the challenging market
environment have concluded.
The targeted annual cost savings of EUR 6 million are expected to be
achieved from the fourth quarter of 2013 onwards.
-- The
Biorefinery R&D unit was transferred from the segment Other to the
Biomaterials Business Area at the beginning of 2013. The unit will create
future business opportunities.
-- The Montes del Plata pulp mill project is progressing and currently more
than 80% of the construction work has been completed. The mill is expected
to start up approximately mid-year 2013.
Markets
Produc Market Demand Q4/12 Demand Q4/12 Price Q4/12 Price Q4/12
t compared with compared with compared with compared with
Q4/11 Q3/12 Q4/11 Q3/12
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Softwo Europe Significantly Slightly Significantly Slightly
od stronger stronger lower higher
pulp
Building and Living
Building and Living provides wood-based products and innovations for
construction and interior decoration, as well as solid biofuels for the energy
sector. Building and Living products address building, living and packaging
needs. The products are recyclable, and made from high quality renewable
European pine or spruce.
EUR Q4/12 Q3/12 Q4/11 2012 2011 Change % Change % Change %
million Q4/12-Q4/ Q4/12-Q3 2012-2011
11 /12
--------------------------------------------------------------------------------
Sales 456.2 403.3 382.0 1 684.4 1 671.1 19.4 13.1 0.8
Operation 17.0 10.4 15.4 58.8 102.3 10.4 63.5 -42.5
al EBITDA
Operation 6.8 0.7 6.0 28.8 62.8 13.3 n/m -54.1
al EBIT
% of 1.5 0.2 1.6 1.7 3.8 -6.3 n/m -55.3
sales
Operation 4.7 0.5 4.2 5.1 10.9 11.9 n/m -53.2
al ROOC,
%*
Deliverie 1 132 1 097 1 143 4 592 4 920 -1.0 3.2 -6.7
s, 1 000
m3
----------------------------------------------------------------------
* Operational ROOC = 100% x Operational EBIT/Average operating capital
-- Sales prices in local currencies were slightly higher than a year ago,
mainly due to a better geographical mix and slightly higher overseas
prices, but the market in Europe remained weak. The fourth quarter of 2012
was the first full quarter when the sawn timber trading company RETS Timber
Oy Ltd was consolidated as a subsidiary in the Building and Living Business
Area.
-- Actions are planned to reduce costs and increase productivity throughout
the Business Area. Annual cost savings targeted EUR 30 million.
-- The pressure in raw material markets persisted and the decreased raw
material availability, especially in Central Europe, increased saw log
costs and continued to reduce profits.
-- The previously announced profit improvement actions are proceeding as
planned.
-- Building and Living agreed on collaboration with Skanska in which Stora
Enso will supply wooden modular elements for a BoKlok project at Vantaa in
Finland. Construction work will commence in spring 2013.
-- Building and Living and the construction company SRV announced the winner
of the Wood City architectural competition. Construction of the world-class
wooden city quarter in Helsinki will start in early 2014.
Markets
Produc Market Demand Q4/12 Demand Q4/12 Price Q4/12 Price Q4/12
t compared with compared with compared with compared with
Q4/11 Q3/12 Q4/11 Q3/12
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Wood Europe Weaker Slightly weaker Slightly Stable
produ higher
cts
Renewable Packaging
Renewable Packaging produces fibre-based packaging materials and innovative
packaging solutions for all major consumer goods and industrial packaging
applications. Renewable Packaging operates in every stage of the value chain,
from pulp production, material and package production to recycling. The
Business Area comprises three business units: Consumer Board, Packaging
Solutions and Packaging Asia.
EUR million Q4/12 Q3/12 Q4/11 2012 2011 Change Change Change
% % %
Q4/12-Q Q4/12-Q 2012-20
4/11 3/12 11
--------------------------------------------------------------------------------
Sales 797.7 812.2 756.6 3 216.0 3 194.6 5.4 -1.8 0.7
Operational 105.5 134.0 82.7 474.6 495.8 27.6 -21.3 -4.3
EBITDA
Operational 54.8 82.9 32.8 271.9 301.3 67.1 -33.9 -9.8
EBIT
% of sales 6.9 10.2 4.3 8.5 9.4 60.5 -32.4 -9.6
Operational 9.2 14.2 6.1 12.1 14.2 50.8 -35.2 -14.8
ROOC, %*
Paper and 778 782 720 3 138 3 111 8.1 -0.5 0.9
board
deliveries, 1
000 t
Paper and 752 821 701 3 147 3 118 7.3 -8.4 0.9
board
production, 1
000 t
Corrugated 279 275 273 1 097 1 018 2.2 1.5 7.8
packaging
deliveries,
million m2
Corrugated 275 269 264 1 076 1 006 4.2 2.2 7.0
packaging
production,
million m2
-----------------------------------------------------------------
* Operational ROOC = 100% x Operational EBIT/Average operating capital
-- Slightly lower sales prices in local currencies for corrugated packaging,
mainly due to the product mix, were offset by lower variable costs,
especially for corrugated raw material and wood. Volumes were higher than a
year ago, supported by the stronger market and growth initiatives. The
ongoing actions to control fixed costs proved effective as these costs were
kept to the same level as a year ago.
-- Preparations to establish the joint venture Bulleh Shah Packaging (Private)
Limited with Packages Ltd. of Pakistan are proceeding as planned.
Establishment of the joint venture is expected to be completed during the
first quarter of 2013.
-- There were some temporary production disturbances following the investments
at Skoghall Mill in Sweden and Imatra Mills in Finland.
-- In the integrated plantation-based board and pulp mills project at Beihai
city in Guangxi in China, the preparations are proceeding. The construction
and production schedule will be updated when the final approvals are given
and detailed plans are in place.
-- The new containerboard machine at
Ostrołęka Mill in Poland started up in January 2013 six weeks ahead of the
internal schedule. The machine is currently in the ramp-up phase, which is
expected to take couple of months.
-- Board machine (BM) 2 at Ostrołęka Mill was permanently shut down in January
2013. Negotiations concerning permanent closure of the corrugated packaging
plant at Ruovesi in Finland have concluded and the plant will be closed
down at the end of July 2013. Negotiations concerning streamlining of
operations at the Heinola, Ingerois and Pori board plants in Finland and
corrugated packaging operations at all the Swedish units announced on 23
October 2012 have concluded at all sites. The targeted annual cost savings
of EUR 13 million are expected to be achieved from the fourth quarter of
2013 onwards.
Markets
Product Market Demand Q4/12 Demand Q4/12 Price Q4/12 Price Q4/12
compared with compared with compared compared with
Q4/11 Q3/12 with Q4/11 Q3/12
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Consumer Europe Significantly Slightly Stable Stable
board stronger weaker
Corrugate Europe Slightly Stable Slightly Stable
d stronger lower
packagin
g
Other
The segment Other includes the Nordic forest equity accounted investments,
Stora Enso's shareholding in Pohjolan Voima, operations supplying wood to the
Nordic mills and Group shared services and administration.
EUR Q4/12 Q3/12 Q4/11 2012 2011 Change % Change % Change %
million Q4/12-Q4/ Q4/12-Q3/ 2012-201
11 12 1
--------------------------------------------------------------------------------
Sales 673.0 644.9 643.9 2 683.5 2 700.5 4.5 4.4 -0.6
Operation -11.2 -1.7 -4.8 -38.3 -38.1 -133.3 n/m -0.5
al EBITDA
Operation 7.7 7.5 23.3 17.4 48.1 -67.0 2.7 -63.8
al EBIT
% of 1.1 1.2 3.6 0.6 1.8 -69.4 -8.3 -66.7
sales
----------------------------------------------------------------------
-- Operational EBIT from the Nordic equity accounted investments was EUR 8
million lower than a year ago mainly due to lower capital gains.
-- Costs were similar to a year ago in Group services.
Short-term Risks and Uncertainties
The main short-term risks and uncertainties continue to relate to the potential
impact on the Group's products from the economic situation in Europe and the
structural decline in paper demand.
Energy sensitivity analysis: the direct effect of a 10% increase in
electricity, heat, oil and other fossil fuel market prices would have a
negative impact of approximately EUR 20 million on operational EBIT for the
next twelve months, after the effect of hedges.
Wood sensitivity analysis: the direct effect of a 10% increase in wood prices
would have a negative impact of approximately EUR 204 million on operational
EBIT for the next twelve months.
Chemicals and fillers sensitivity: the direct effect of a 10% increase in
chemical and filler prices would have a negative impact of approximately EUR 74
million on operational EBIT for the next twelve months.
A decrease in energy, wood or chemical and filler prices would have the
opposite impact.
Foreign exchange rates sensitivity analysis for the next twelve months: the
direct effect on operational EBIT of a 10% strengthening in the value of the US
dollar, Swedish krona and British pound against the euro would be about
positive EUR 103 million, negative EUR 93 million and positive EUR 60 million
annual impact, respectively. Weakening of the currencies would have the
opposite impact. These numbers are before the effect of hedges and assuming no
changes occur other than a single currency exchange rate movement.
Fourth Quarter Events
In October Stora Enso announced the composition of its Nomination Board.
Veracel
On 11 July 2008 Stora Enso announced that a federal judge in Brazil had issued
a decision claiming that the permits issued by the State of Bahia for the
operations of Stora Enso's equity accounted investment Veracel were not valid.
The judge also ordered Veracel to take certain actions, including reforestation
with native trees on part of Veracel's plantations and a possible BRL 20
million (EUR 7 million) fine. Veracel disputes the decision and has filed an
appeal against it. Veracel operates in full compliance with all Brazilian laws
and has obtained all the necessary environmental and operating licences for its
industrial and forestry activities from the competent authorities. In November
2008 a Federal Court suspended the effects of the decision. Veracel has not
recorded any provision for the reforestation or the possible fine.
On 30 September 2009 a judge in the State of Bahia issued an interim decision
ordering the State Government of Bahia not to grant Veracel further plantation
licences in the municipality of Eunápolis in response to claims by a state
prosecutor that Veracel's plantations exceeded the legal limits, which Veracel
disputes. Veracel's position is supported by documentation issued by the State
environmental authority.
Class Action Lawsuits in USA
In the context of magazine paper sales in the USA in 2002 and 2003, Stora Enso
Oyj (SEO) and Stora Enso North America (SENA) were sued in a number of class
action (and other civil) lawsuits filed in the USA by various magazine paper
purchasers that claimed damages for alleged antitrust violations. On 14
December 2010 a US federal district court granted a motion for summary
judgement that Stora Enso had filed on behalf of both SEO and SENA seeking
dismissal of the direct purchaser class action claims. Following appeal, a
federal court of appeals on 6 August 2012 upheld the district court's ruling as
to SEO, which means that the direct purchaser class action claims against SEO
have been found to be without legal foundation, but reversed the district
court's ruling as to SENA and referred that part of the case back to the
district court for a jury trial to determine whether SENA's conduct did violate
the federal antitrust laws. The appeal court's decision is procedural and does
not constitute a legal finding that SENA has violated antitrust laws. A motion
by SENA requesting the US Supreme Court to review and reverse the federal court
of appeals decision vacating the district court's ruling as to SENA has been
dismissed by the Supreme Court and the case against SENA will now proceed to
trial in the district court. Furthermore, most of the indirect purchaser
actions have been dismissed by a consent judgement, subject, however, to being
reinstated if the plaintiffs in the direct cases are ultimately successful in
obtaining a final judgement that SENA violated antitrust laws. Since Stora Enso
disposed of SENA in 2007, Stora Enso's liability, if any, will be determined by
the provisions in the SENA Sales and Purchasing Agreement. No provisions have
been made in Stora Enso's accounts for these lawsuits.
Legal Proceedings in Finland
On 3 December 2009 the Finnish Market Court fined Stora Enso for competition
law infringements in the market for roundwood in Finland from 1997 to 2004.
Stora Enso did not appeal against the ruling.
On 31 March 2011 Metsähallitus of Finland initiated legal proceedings against
Stora Enso, UPM and Metsäliitto claiming compensation for damages allegedly
suffered due to the competition law infringements. The total claim against all
the defendants amounts to approximately EUR 160 million and the secondary claim
against Stora Enso to approximately EUR 85 million.
In addition, Finnish municipalities and private forest owners have initiated
similar legal proceedings. The total amount claimed from all the defendants
amounts to approximately EUR 70 million and the secondary claims and claims
solely against Stora Enso to approximately EUR 25 million.
Stora Enso denies that Metsähallitus and other plaintiffs have suffered any
damages whatsoever and will forcefully defend itself. No provisions have been
made in Stora Enso's accounts for these lawsuits.
Changes in Organisational Structure and Group Management
On 17 January 2012 Stora Enso announced that it was renewing its Business Area
and Reporting Segment structure. The changes in the Business Areas and
management took effect as of 17 January 2012.
The Group Executive Team has been as follows since 19 March 2012:
Jouko Karvinen, Chief Executive Officer
Juan Bueno, Executive Vice President, Biomaterials Business Area
Lars Häggström, Executive Vice President, Global People and Organisation
Hannu Kasurinen, Executive Vice President, Building and Living Business Area
Per Lyrvall, Executive Vice President, Global Ethics and Compliance, General
Counsel
Mats Nordlander, Executive Vice President, Renewable Packaging Business Area
Lauri Peltola, Executive Vice President, Global Identity
Karl-Henrik Sundström, Executive Vice President, Chief Financial Officer (as of
1 August 2012)
Juha Vanhainen, Executive Vice President, Printing and Reading Business Area
Markus Rauramo, Executive Vice President, Chief Financial Officer and a member
of the Group Executive Team, relinquished his duties with Stora Enso on 31 July
2012.
Personnel
On 31 December 2012 there were 28 203 employees in the Group, 1 302 less than
at the end of 2011. The average number of employees in 2012 was 28 777, which
was 819 higher than the average number in 2011. The average number of employees
in 2012 was 724 lower in Europe and 1 543 higher in other areas, mainly Asia,
than in 2011.
Share Capital
During the quarter no A shares were converted into R shares.
On 31 December 2012 Stora Enso had 177 147 772 A shares and 612 390 727 R
shares in issue of which the Company held no A shares and 918 512 R shares with
a nominal value of EUR 1.6 million. The holding represents 0.12% of the
Company's share capital and 0.04% of the voting rights.
Annual General Meeting
The Annual General Meeting (AGM) will be held at 16.00 (Finnish time) on
Tuesday 23 April 2013 at Marina Congress Center, Katajanokanlaituri 6,
Helsinki, Finland.
The agenda of the AGM and proposals on the agenda of the AGM, as well as the
AGM notice, will be available on Stora Enso Oyj's website at
www.storaenso.com/agm. Stora Enso's annual accounts, the Report of the Board of
Directors and the auditor's report for 2012 will be published on Stora Enso
Oyj's website www.storaenso.com/investors during the week commencing on Monday
18 February 2013. The proposals for decisions and the other above-mentioned
documents will also be available at the AGM. Copies of these documents and of
this notice will be sent to shareholders upon request. The minutes of the AGM
will be available on Stora Enso Oyj's website www.storaenso.com/agm from
Tuesday 7 May 2013.
The Board of Directors' Proposal for the Payment of Dividend
The Board of Directors proposes to the AGM that a dividend of EUR 0.30 per
share be distributed for the year 2012.
The dividend would be paid to shareholders who on the record date of the
dividend payment, 26 April 2013, are recorded in the shareholders' register
maintained by Euroclear Finland Ltd. or in the separate register of
shareholders maintained by Euroclear Sweden AB for Euroclear Sweden registered
shares. Dividends payable for Euroclear Sweden registered shares will be
forwarded by Euroclear Sweden AB and paid in Swedish krona. Dividends payable
to ADR holders will be forwarded by Deutsche Bank Trust Company Americas and
paid in US dollars.
The Board of Directors proposes to the AGM that the dividend be paid on 15 May
2013.
This report is unaudited.
Helsinki, 5 February 2013
Stora Enso Oyj
Board of Directors
Financials
Basis of Preparation
This unaudited interim financial report has been prepared in accordance with
the accounting policies set out in International Accounting Standard 34 on
Interim Financial Reporting and in the Group's Annual Report for 2011.
There were no new EU-endorsed standards or interpretations effective from 1
January 2012. The IASB has published one amendment effective from 1 January
2012. It does not affect the Group's financial statements.
New Business Area Structure
In the first quarter of 2012 Stora Enso reorganised its Business Area and
Reporting Segment structure based on the different markets and customers the
Business Areas serve. The new reporting segments are Printing and Reading,
Biomaterials, Building and Living, Renewable Packaging and Other.
The Printing and Reading Business Area comprises the former Newsprint and Book
Paper, Magazine Paper and Fine Paper reporting segments. The Biomaterials
Business Area mainly comprises tree plantations, the Group's joint-venture
Veracel and Montes del Plata pulp mills and Nordic stand-alone pulp mills. The
Wood Products Business Area was renamed the Building and Living Business Area.
The Renewable Packaging Business Area comprises the former Consumer Board and
Industrial Packaging reporting segments, and includes the plantations in
Guangxi in China. The segment Other includes the Nordic forest equity accounted
investments, Stora Enso's shareholding in Pohjolan Voima, the operations
supplying wood to the Nordic mills and Group administration. The comparative
data have been reclassified accordingly.
Condensed Consolidated Income Statement
EUR Q4/12 Q3/12 Q4/11 2012 2011 Change Change Change
milli % % %
on Q4/12- Q4/12- 2012-2
Q4/11 Q3/12 011
--------------------------------------------------------------------------------
Sales 2 727.0 2 694.1 2 681.6 10 814.8 10 964.9 1.7 1.2 -1.4
Other 47.6 47.7 53.1 218.8 208.9 -10.4 -0.2 4.7
opera
ting
incom
e
Materi -1 782.2 -1 724.6 -1 796.2 -6 974.1 -6 971.9 0.8 -3.3 -
als
and
servi
ces
Freigh -259.4 -255.8 -243.5 -1 007.5 -1 018.9 -6.5 -1.4 1.1
t and
sales
commi
ssions
Person -314.6 -331.1 -327.9 -1 360.8 -1 393.9 4.1 5.0 2.4
nel
expen
ses
Other -161.8 -127.7 -148.3 -578.3 -575.2 -9.1 -26.7 -0.5
opera
ting
expen
ses
Share 91.1 8.0 89.9 107.7 118.0 1.3 n/m -8.7
of
resul
ts of
equit
y
accou
nted
inves
tments
Deprec -96.6 -149.3 -139.2 -531.6 -572.6 30.6 35.3 7.2
iation
and
impai
rment
-------------------------------------------------------------------------
Operat 251.1 161.3 169.5 689.0 759.3 48.1 55.7 -9.3
ing
Profi
t
Net -47.4 -59.1 -59.2 -207.3 -338.4 19.9 19.8 38.7
finan
cial
items
-------------------------------------------------------------------------
Profit 203.7 102.2 110.3 481.7 420.9 84.7 99.3 14.4
befor
e Tax
Income 61.8 -20.9 -10.1 8.7 -78.7 n/m n/m 111.1
tax
-------------------------------------------------------------------------
Net 265.5 81.3 100.2 490.4 342.2 165.0 226.6 43.3
Profi
t for
the
Perio
d
Attrib
utable
to:
Owners 261.8 80.0 98.7 480.5 339.7 165.2 227.3 41.4
of
the
Paren
t
Non-co 3.7 1.3 1.5 9.9 2.5 146.7 184.6 296.0
ntroll
ing
inter
ests
-------------------------------------------------------------------------
265.5 81.3 100.2 490.4 342.2 165.0 226.6 43.3
=========================================================================
Earnin
gs per
Share
Basic 0.33 0.10 0.12 0.61 0.43 175.0 230.0 41.9
earni
ngs
per
share
, EUR
Dilute 0.33 0.10 0.12 0.61 0.43 175.0 230.0 41.9
d
earni
ngs
per
share
, EUR
Consolidated Statement of Comprehensive Income
EUR million 2012 2011
--------------------------------------------------------------------------------
Net profit for the period 490.4 342.2
Other Comprehensive Income
Actuarial losses on defined benefit plans -167.3 -55.8
Available-for-sale financial assets -177.6 -240.5
Currency and commodity hedges 33.6 -128.4
Share of other comprehensive income of equity accounted -4.2 -19.4
investments
Currency translation movements on equity net investments (CTA) -29.4 -76.2
Currency translation movements on non-controlling interests -3.2 -
Net investment hedges -16.8 6.0
Income tax relating to components of other comprehensive income 29.6 40.8
---------------
---------------
Other Comprehensive Income net of tax -335.3 -473.5
---------------
Total Comprehensive Income 155.1 -131.3
---------------
---------------
Total Comprehensive Income Attributable to:
Owners of the Parent 148.4 -133.8
Non-controlling interests 6.7 2.5
155.1 -131.3
===============
Condensed Consolidated Statement of Cash Flows
EUR million 2012 2011
--------------------------------------------------------------------------------
Cash Flow from Operating Activities
Operating profit 689.0 759.3
Hedging result from OCI 33.7 -127.3
Adjustments for non-cash items 491.3 492.0
Change in net working capital 55.4 -173.3
-----------------
Cash Flow Generated by Operations 1 269.4 950.7
Net financial items paid -230.2 -124.8
Income taxes paid, net -103.6 -129.1
-----------------
Net Cash Provided by Operating Activities 935.6 696.8
-----------------
-----------------
Cash Flow from Investing Activities
Acquisitions of subsidiaries and business operations, net of -11.3 -25.0
acquired cash
Acquisitions of equity accounted investments -114.5 -128.6
Proceeds from sale of fixed assets and shares, net of disposed 8.1 22.1
cash
Capital expenditure -560.7 -409.6
Payments/proceeds of non-current receivables, net -5.3 -4.0
-----------------
Net Cash Used in Investing Activities -683.7 -545.1
-----------------
-----------------
Cash Flow from Financing Activities
Proceeds from issue of new long-term debt 1 471.5 61.7
Long-term debt, payments -570.7 -83.3
Change in short-term borrowings -179.3 131.2
Dividends paid -236.6 -197.2
Dividend to non-controlling interests -2.5 -3.6
-----------------
Net Cash Provided by/Used in Financing Activities 482.4 -91.2
-----------------
-----------------
Net Increase in Cash and Cash Equivalents 734.3 60.5
Translation adjustment -23.2 -29.3
Net cash and cash equivalents at the beginning of period 1 134.3 1 103.1
-----------------
Net Cash and Cash Equivalents at Period End 1 845.4 1 134.3
-----------------
Cash and Cash Equivalents at Period End 1 849.9 1 138.8
Bank Overdrafts at Period End -4.5 -4.5
-----------------
Net Cash and Cash Equivalents at Period End 1 845.4 1 134.3
-----------------
Acquisitions
Cash and cash equivalents, net of bank overdraft 1.8 15.7
Fixed assets 5.8 52.0
Working capital 8.5 13.1
Tax assets and liabilities 0.6 -4.6
Interest-bearing liabilities and receivables -5.0 -5.4
-----------------
Fair Value of Net Assets Acquired 11.7 70.8
Non-controlling interest (as proportionate share) -0.2 -37.2
Goodwill (provisional for 2011) 0.1 11.3
Value of previously held equity interests -2.8 -
-----------------
Total Purchase Consideration 8.8 44.9
Less cash and cash equivalents in acquired companies -1.8 -15.7
-----------------
Net Purchase Consideration 7.0 29.2
-----------------
Cash part of the consideration, net of acquired cash 11.3 25.0
Non-cash part of the consideration - 4.2
Payment concerning unfinished 2011 acquisition -4.3 -
-----------------
Net Purchase Consideration 7.0 29.2
-----------------
Inpac Acquisition
EUR million Final Fair Value
Table
--------------------------------------------------------------------------------
Cash and cash equivalents, net of bank overdraft 15.7
Fixed assets 52.4
Working Capital 12.5
Tax assets and liabilities -4.6
Interest-bearing assets and liabilities -5.4
Non-controlling interest -37.6
--------------------------------------------------------------------------------
Net Assets 33.0
Goodwill 11.5
--------------------------------------------------------------------------------
Purchase Consideration 44.5
--------------------------------------------------------------------------------
Consideration 44.5
Cash and cash equivalents in acquired companies, net of -15.7
bank overdraft
--------------------------------------------------------------------------------
Cash Flow Impact 28.8
--------------------------------------------------------------------------------
Inpac acquisition
On 28 July 2011 Stora Enso completed the acquisition of 51% of the shares in
the Chinese packaging company Inpac International Print & Packaging Co., Ltd.,
subsequently renamed Stora Enso Inpac Packaging Co. Ltd. Inpac is a packaging
products company with production operations in China and India, and service
operations in Korea. Inpac specialises in manufacturing consumer packaging,
especially for global manufacturers of consumer electronics and other consumer
goods. The acquisition gives Stora Enso access to new customers in the
fast-growing Chinese, Indian and Korean markets, and will enable it to grow
with global key customers in new geographic areas.
The Inpac acquisition accounting was finalised in the third quarter of 2012 and
the final consideration amounted to EUR 44.5 million and goodwill to EUR 11.5
million. During 2012 there was a EUR 0.2 million adjustment to the provisional
net asset amount presented in 2011 Annual Report. The acquisition was financed
from the Group's own cash assets. The goodwill is based on future earnings
expectations and synergy benefits. The non-controlling interest in Inpac was
valued as the proportionate share of the acquiree's net assets.
Property, Plant and Equipment, Intangible Assets and Goodwill
EUR million 2012 2011
-------------------------------------------------------
Carrying value at 1 January 5 480.2 5 565.8
Acquisition of subsidiary companies 5.9 63.3
Additions in fixed assets 536.6 436.1
Additions in biological assets 19.7 17.2
Change in emission rights -13.3 2.0
Disposals -2.3 -13.4
Depreciation and impairment -531.6 -572.6
Translation difference and other 75.3 -18.2
-----------------
Statement of Financial Position Total 5 570.5 5 480.2
=================
Borrowings
EUR million 31 Dec 12 31 Dec 11
-----------------------------------------------------------
Non-current borrowings 4 341.3 3 339.4
Current borrowings 792.5 1 034.0
---------------------
5 133.8 4 373.4
===================== ---------------------
2012 2011
---------------------
Carrying value at 1 January 4 373.4 4 011.2
Debt acquired with new subsidiaries 0.4 5.4
Proceeds of borrowings (net) 711.8 331.6
Translation difference and other 48.2 25.2
---------------------
Statement of Financial Position Total 5 133.8 4 373.4
=====================
Condensed Consolidated Statement of Financial Position
EUR million 31 Dec 12 31 Dec 11
-----------------------------------------------------------------------
Assets
Fixed Assets and Other Non-current Investments
Fixed assets O 5 319.2 5 224.6
Biological assets O 221.7 212.6
Emission rights O 29.6 43.0
Equity accounted investments O 1 965.1 1 913.1
Available-for-sale: Interest-bearing I 95.9 82.0
Available-for-sale: Operative O 450.6 640.2
Non-current loan receivables I 134.2 125.3
Deferred tax assets T 143.1 121.9
Other non-current assets O 23.1 26.6
---------------------
8 382.5 8 389.3
---------------------
---------------------
Current Assets
Inventories O 1 457.5 1 528.7
Tax receivables T 18.5 6.2
Operative receivables O 1 688.2 1 654.6
Interest-bearing receivables I 297.0 281.5
Cash and cash equivalents I 1 849.9 1 138.8
---------------------
5 311.1 4 609.8
Total Assets 13 693.6 12 999.1
=====================
Equity and Liabilities
Owners of the Parent 5 784.5 5 872.7
Non-controlling Interests 91.5 87.1
---------------------
Total Equity 5 876.0 5 959.8
=====================
Non-current Liabilities
Post-employment benefit provisions O 461.6 333.1
Other provisions O 142.0 147.7
Deferred tax liabilities T 343.8 401.0
Non-current debt I 4 341.3 3 339.4
Other non-current operative liabilities O 11.7 31.9
---------------------
5 300.4 4 253.1
---------------------
---------------------
Current Liabilities
Current portion of non-current debt I 181.0 250.0
Interest-bearing liabilities I 611.5 784.0
Operative liabilities O 1 685.6 1 678.7
Tax liabilities T 39.1 73.5
---------------------
2 517.2 2 786.2
---------------------
Total Liabilities 7 817.6 7 039.3
=====================
Total Equity and Liabilities 13 693.6 12 999.1
=====================
Items designated with “O” comprise Operating Capital
Items designated with “I” comprise Interest-bearing Net Liabilities
Items designated with “T” comprise Net Tax Liabilities
Statement of Changes in Equity
EUR Share Share Invest Treasu Step Availa Curren OCI of CTA
Retaine Attribu Non-co Total
milli Capital Premiu ed ry Acquis ble cy and Equity and
d table ntroll
on m and Non-Re Shares ition for Commod Accoun Net
Earning to ing
Reserv strict Revalu Sale ity ted Invest
s Owners Intere
e fund ed ation Financ Hedges Invest ment
of the sts
Equity Surplu ial ments Hedges
Parent
Fund s Assets
--------------------------------------------------------------------------------
----------------------------------
Balanc 1 342.2 76.6 633.1 -10.2 3.9 780.0 77.9 -9.8 103.7
3 205.5 6 202.9 51.8 6 254.7
e at
31
Decem
ber
2010
--------------------------------------------------------------------------------
---------------------------
Profit - - - - - - - - -
339.7 339.7 2.5 342.2
for
the
perio
d
OCI - - - - - -240.5 -128.4 -19.4 -70.2
-55.8 -514.3 - -514.3
befor
e tax
Income - - - - - 1.1 33.3 - -1.5
7.9 40.8 - 40.8
tax
relat
ing to
compo
nents
of
OCI
--------------------------------------------------------------------------------
---------------------------
Total - - - - - -239.4 -95.1 -19.4 -71.7
291.8 -133.8 2.5 -131.3
Compr
ehensi
ve
Incom
e
--------------------------------------------------------------------------------
---------------------------
--------------------------------------------------------------------------------
---------------------------
Divide - - - - - - - - -
-197.2 -197.2 -3.6 -200.8
nd
Acquis - - - - - - - - -
- - 37.2 37.2
itions
Buy-ou - - - - - - - - -
0.8 0.8 -0.8 -
t of
non-c
ontrol
ling
inter
est
--------------------------------------------------------------------------------
---------------------------
Balanc 1 342.2 76.6 633.1 -10.2 3.9 540.6 -17.2 -29.2 32.0
3 300.9 5 872.7 87.1 5 959.8
e at
31
Dec
2011
--------------------------------------------------------------------------------
---------------------------
--------------------------------------------------------------------------------
---------------------------
Profit - - - - - - - - -
480.5 480.5 9.9 490.4
for
the
perio
d
OCI - - - - - -177.6 33.6 -4.2 -46.2
-167.3 -361.7 -3.2 -364.9
befor
e tax
Income - - - - - -0.8 -5.7 - 4.1
32.0 29.6 - 29.6
tax
relat
ing to
compo
nents
of
OCI
--------------------------------------------------------------------------------
---------------------------
Total - - - - - -178.4 27.9 -4.2 -42.1
345.2 148.4 6.7 155.1
Compr
ehensi
ve
Incom
e
--------------------------------------------------------------------------------
---------------------------
--------------------------------------------------------------------------------
---------------------------
Divide - - - - - - - - -
-236.6 -236.6 -2.5 -239.1
nd
Acquis - - - - - - - - -
- - 0.2 0.2
itions
--------------------------------------------------------------------------------
---------------------------
Balanc 1 342.2 76.6 633.1 -10.2 3.9 362.2 10.7 -33.4 -10.1
3 409.5 5 784.5 91.5 5 876.0
e at
31
Dec
2012
--------------------------------------------------------------------------------
---------------------------
CTA = Cumulative Translation Adjustment
OCI = Other Comprehensive Income
Commitments and Contingencies
EUR million 31 Dec 12 31 Dec 11
---------------------------------------------------------------
On Own Behalf
Pledges 0.7 1.3
Mortgages 6.0 9.7
On Behalf of Equity Accounted Investments
Guarantees 652.7 418.4
On Behalf of Others
Guarantees 4.9 5.0
Other commitments 0.1 -
Other Commitments, Own
Operating leases, in next 12 months 62.9 66.1
Operating leases, after next 12 months 496.9 525.8
Pension liabilities 0.4 0.4
Other commitments 5.2 5.1
---------------------
Total 1 229.8 1 031.8
=====================
Pledges 0.7 1.3
Mortgages 6.0 9.7
Guarantees 657.6 423.4
Operating leases 559.8 591.9
Pension liabilities 0.4 0.4
Other commitments 5.3 5.1
---------------------
Total 1 229.8 1 031.8
=====================
Capital commitments
The Group's direct capital expenditure contracts, excluding acquisitions,
amounted to EUR 71.8 (EUR 213.9) million.
The Group's share of capital expenditure contracts in equity accounted
investments, excluding acquisitions, amounted to EUR 212.8 (EUR 435.7) million
of which Stora Enso has guaranteed EUR 189.0 (EUR 189.0) million.
Fair Values of Derivative Financial Instruments
EUR million 31 Dec 12 31 Dec 11
--------------------------------------------------------------------------------
Positive Negative Net Fair Net Fair
Fair Fair Values Values
Values Values
Fair Value Hedge
Accounted
Interest rate swaps 7.2 - 7.2 8.5
Cash Flow Hedge Accounted
Currency forward 1.0 -0.4 0.6 -4.1
contracts
Currency options 30.0 -5.6 24.4 -16.1
Commodity contracts 3.8 -17.6 -13.8 -
Net Investment Hedge
Accounted
Currency forward - -0.3 -0.3 1.0
contracts
Non-qualifying Hedges
Interest rate swaps 117.4 -72.9 44.5 87.3
Interest rate options - -53.1 -53.1 -51.0
Currency forward 9.3 -29.4 -20.1 7.9
contracts
Currency options 0.1 - 0.1 -
Commodity contracts 0.3 -0.1 0.2 -2.1
Equity swaps (“TRS”) 2.6 - 2.6 -22.6
Total 171.7 -179.4 -7.7 8.8
======================================================
Nominal Values of Derivative Financial Instruments
EUR million 31 Dec 12 31 Dec 11
--------------------------------------------------
Interest Rate Derivatives
Interest rate swaps
Maturity under 1 year - 61.6
Maturity 2-5 years 2 077.4 2 073.3
Maturity 6-10 years 250.0 250.0
---------------------
2 327.4 2 384.9
Interest rate options 516.1 522.8
---------------------
Total 2 843.5 2 907.7
---------------------
Foreign Exchange Derivatives
Forward contracts 1 975.1 1 750.2
Currency options 2 642.2 2 669.4
---------------------
Total 4 617.3 4 419.6
---------------------
.
Commodity Derivatives
Commodity contracts 330.7 236.7
---------------------
Total 330.7 236.7
---------------------
Total Return (Equity) Swaps
Equity swaps (“TRS”) 54.8 73.3
---------------------
Total 54.8 73.3
---------------------
Sales by Segment
EUR 2012 Q4/12 Q3/12 Q2/12 Q1/12 2011 Q4/11
Q3/11 Q2/11 Q1/11
milli
on
--------------------------------------------------------------------------------
------------------
Printi 4 839.3 1 194.5 1 226.8 1 190.8 1 227.2 5 022.0 1 283.8 1
283.1 1 242.6 1 212.5
ng and
Readi
ng
Biomat 1 012.4 256.6 267.6 246.5 241.7 1 092.0 255.4
276.4 268.6 291.6
erials
Buildi 1 684.4 456.2 403.3 443.7 381.2 1 671.1 382.0
414.0 465.4 409.7
ng and
Livin
g
Renewa 3 216.0 797.7 812.2 826.8 779.3 3 194.6 756.6
800.6 829.6 807.8
ble
Packa
ging
Other 2 683.5 673.0 644.9 662.2 703.4 2 700.5 643.9
637.4 700.1 719.1
Inter- -2 620.8 -651.0 -660.7 -649.6 -659.5 -2 715.3 -640.1
-672.2 -689.2 -713.8
segmen
t
sales
--------------------------------------------------------------------------------
-----------
Total 10 814.8 2 727.0 2 694.1 2 720.4 2 673.3 10 964.9 2 681.6 2
739.3 2 817.1 2 726.9
================================================================================
===========
Operational EBIT by Segment
EUR 2012 Q4/12 Q3/12 Q2/12 Q1/12 2011 Q4/11 Q3/11 Q2/11 Q1/11
millio
n
--------------------------------------------------------------------------------
Printin 218.1 58.0 51.1 41.7 67.3 285.3 55.6 72.3 72.2 85.2
g and
Readin
g
Biomate 82.1 27.7 32.5 14.7 7.2 169.2 27.2 57.3 31.2 53.5
rials
Buildin 28.8 6.8 0.7 11.5 9.8 62.8 6.0 9.8 35.2 11.8
g and
Living
Renewab 271.9 54.8 82.9 72.5 61.7 301.3 32.8 73.6 93.9 101.0
le
Packag
ing
Other 17.4 7.7 7.5 0.8 1.4 48.1 23.3 11.4 6.6 6.8
------------------------------------------------------------------------
Operati 618.3 155.0 174.7 141.2 147.4 866.7 144.9 224.4 239.1 258.3
onal
EBIT
Fair -58.9 -13.6 -13.4 -33.1 1.2 -27.5 45.6 -45.8 -26.9 -0.4
valuat
ions
and
non-op
eration
al
items*
Non-rec 129.6 109.7 - 44.6 -24.7 -79.9 -21.0 - -31.7 -27.2
urring
Items
------------------------------------------------------------------------
Operati 689.0 251.1 161.3 152.7 123.9 759.3 169.5 178.6 180.5 230.7
ng
Profit
(IFRS)
Net -207.3 -47.4 -59.1 -66.8 -34.0 -338.4 -59.2 -193.4 -34.6 -51.2
financ
ial
items
Profit/ 481.7 203.7 102.2 85.9 89.9 420.9 110.3 -14.8 145.9 179.5
Loss
before
Tax
Income 8.7 61.8 -20.9 -16.4 -15.8 -78.7 -10.1 -35.1 -9.9 -23.6
tax
expens
e
------------------------------------------------------------------------
Net 490.4 265.5 81.3 69.5 74.1 342.2 100.2 -49.9 136.0 155.9
Profit
/Loss
========================================================================
*Fair valuations and non-operational items include equity incentive schemes,
synthetic options net of realised and open hedges, CO2 emission rights,
valuations of biological assets related to forest assets in EAI and Group's
share of tax and net financial items of EAI.
NRI by Segment
EUR 2012 Q4/12 Q3/12 Q2/12 Q1/12 2011 Q4/11 Q3/11 Q2/11 Q1/11
million
--------------------------------------------------------------------------------
Printing 70.2 66.9 - 12.9 -9.6 -29.1 3.7 - -27.5 -5.3
and
Reading
Biomater -6.7 -6.7 - - - 12.6 7.5 - -1.9 7.0
ials
Building - - - - - -33.5 -4.6 - - -28.9
and
Living
Renewabl -53.1 -38.0 - - -15.1 -8.9 -6.6 - -2.3 -
e
Packagi
ng
Other 119.2 87.5 - 31.7 - -21.0 -21.0 - - -
-----------------------------------------------------------------------
NRI on 129.6 109.7 - 44.6 -24.7 -79.9 -21.0 - -31.7 -27.2
Operati
ng
Profit
NRI on 33.6 10.5 - 9.5 13.6 -138.3 -10.1 -128.2 - -
Financi
al items
NRI on 63.3 56.4 - 1.9 5.0 62.2 50.8 - 3.6 7.8
tax
-----------------------------------------------------------------------
NRI on 226.5 176.6 - 56.0 -6.1 -156.0 19.7 -128.2 -28.1 -19.4
Net
Profit
=======================================================================
NRI on
Net
Profit
attribu
table
to:
Owners 220.8 175.1 - 51.8 -6.1 -156.0 19.7 -128.2 -28.1 -19.4
of the
Parent
Non-cont 5.7 1.5 - 4.2 - - - - - -
rolling
interes
ts
-----------------------------------------------------------------------
226.5 176.6 - 56.0 -6.1 -156.0 19.7 -128.2 -28.1 -19.4
-----------------------------------------------------------------------
Fair Valuations and Non-operational Items* by Segment
EUR 2012 Q4/12 Q3/12 Q2/12 Q1/12 2011 Q4/11 Q3/11 Q2/11 Q1/11
million
--------------------------------------------------------------------------------
Printing -1.3 0.1 - -0.4 -1.0 -7.9 2.0 -0.3 -9.2 -0.4
and
Reading
Biomateria -29.2 6.1 -7.9 -22.8 -4.6 -18.5 2.7 -11.6 -5.4 -4.2
ls
Building -2.4 - -0.1 -0.1 -2.2 -1.8 - - -1.8 -
and
Living
Renewable -0.7 - - - -0.7 -6.6 - - -6.6 -
Packaging
Other -25.3 -19.8 -5.4 -9.8 9.7 7.3 40.9 -33.9 -3.9 4.2
---------------------------------------------------------------------
Fair -58.9 -13.6 -13.4 -33.1 1.2 -27.5 45.6 -45.8 -26.9 -0.4
Valuation
s and
Non-opera
tional
Items on
Operating
Profit
=====================================================================
*Fair valuations and non-operational items include equity incentive schemes,
synthetic options net of realised and open hedges, CO2 emission rights,
valuations of biological assets related to forest assets in EAI and Group's
share of tax and net financial items of EAI.
Operating Profit/Loss by Segment
EUR 2012 Q4/12 Q3/12 Q2/12 Q1/12 2011 Q4/11 Q3/11 Q2/11 Q1/11
millio
n
--------------------------------------------------------------------------------
Printin 287.0 125.0 51.1 54.2 56.7 248.3 61.3 72.0 35.5 79.5
g and
Readin
g
Biomate 46.2 27.1 24.6 -8.1 2.6 163.3 37.4 45.7 23.9 56.3
rials
Buildin 26.4 6.8 0.6 11.4 7.6 27.5 1.4 9.8 33.4 -17.1
g and
Living
Renewab 218.1 16.8 82.9 72.5 45.9 285.8 26.2 73.6 85.0 101.0
le
Packag
ing
Other 111.3 75.4 2.1 22.7 11.1 34.4 43.2 -22.5 2.7 11.0
------------------------------------------------------------------------
Operati 689.0 251.1 161.3 152.7 123.9 759.3 169.5 178.6 180.5 230.7
ng
Profit
(IFRS)
Net -207.3 -47.4 -59.1 -66.8 -34.0 -338.4 -59.2 -193.4 -34.6 -51.2
financ
ial
items
------------------------------------------------------------------------
Profit/ 481.7 203.7 102.2 85.9 89.9 420.9 110.3 -14.8 145.9 179.5
Loss
before
Tax
Income 8.7 61.8 -20.9 -16.4 -15.8 -78.7 -10.1 -35.1 -9.9 -23.6
tax
expens
e
------------------------------------------------------------------------
Net 490.4 265.5 81.3 69.5 74.1 342.2 100.2 -49.9 136.0 155.9
Profit
/Loss
========================================================================
Key Exchange Rates for the Euro
One Euro is Closing Rate Average Rate
-------------------------------------------------------
31 Dec 12 31 Dec 11 31 Dec 12 31 Dec 11
-------------------------------------------
-------------------------------------------
SEK 8.5820 8.9120 8.7067 9.0307
USD 1.3194 1.2939 1.2856 1.3922
GBP 0.8161 0.8353 0.8111 0.8678
-------------------------------------------
Transaction Risk and Hedges in Main Currencies as at 31 December 2012
EUR million EUR USD SEK GBP Other Total
--------------------------------------------------------------------------------
Sales during 2012 6 250 1 540 1 240 650 1 135 10 815
Costs during 2012 -5 490 -580 -2 330 -120 -1 182 -9 702
--------------------------------------------
Net Operating Flow 760 960 -1 090 530 -47 1 113
--------------------------------------------
--------------------------------------------
Estimated annual net operating cash 1 030 -930 600
flow exposure
Transaction hedges as at 31 Dec -530 470 -270
2012
Hedging Percentage as at 31 Dec 51% 51% 45%
2012 for the Next 12 Months
--------------------------------------------
Additional GBP hedges for 13-15 months increase the hedging percentages by 3%.
Changes in Exchange Rates on Operational EBIT
Operational EBIT: Currency strengthening of + 10% EUR million
--------------------------------------------------------------
--------------------------------------------------
USD 103
SEK -93
GBP 60
--------------------------------------------------------------
The sensitivity is based on estimated next 12 months net operating cash flow.
The calculation does not take into account currency hedges, and assumes no
changes occur other than a single currency exchange rate movement. Weakening
would have the opposite impact.
Stora Enso Shares
Trading Volume Helsinki Stockholm
------------------------------------------
A share R share A share R share
---------------------------------------------------------
October 71 233 77 851 348 84 109 23 253 667
November 53 346 54 496 048 159 593 17 501 573
December 84 849 44 417 489 178 833 22 433 777
------------------------------------------
Total 209 428 176 764 885 422 535 63 189 017
------------------------------------------
Closing Price Helsinki, EUR Stockholm, SEK
------------------------------------------
A share R share A share R share
---------------------------------------------------------
October 5.58 4.87 49.50 41.92
November 5.55 5.04 48.97 43.86
December 5.70 5.25 49.50 44.90
Calculation of Key Figures
Operational return on capital employed, operational ROCE 100 x Operational
(%) EBIT
Capital
employed 1)
2)
Operational return on operating capital, operational 100 x Operational
ROOC (%) EBIT
Operating
capital 1) 2)
Return on equity, 100 x Profit before
ROE (%) tax and
non-controlli
ng items -
taxes
Total equity
2)
Equity ratio (%) 100 x Total equity
Total assets
Interest-bearing net liabilities Interest-beari
ng liabilities
-
interest-bear
ing assets
Debt/equity ratio Interest-beari
ng net
liabilities
Equity 3)
Fixed asset
CEPS Net
profit/loss
for the
period 3) -
depreciation
and
impairment
Average number
of shares
EPS Net
profit/loss
for the
period 3)
Average number
of shares
Operational EBIT Operating
profit/loss
excluding NRI
and fair
valuations of
the
segments and
Stora Enso's
share of
operating
profit/loss
excluding NRI
and fair
valuations of
its equity
accounted
investments
(EAI)
Operational EBITDA Operating
profit/loss
excluding
fixed asset
depreciation
and impairment,
share of
results of
equity
accounted
investments,
NRI and fair
valuations
Net debt to operational EBITDA ratio Interest-beari
ng net
liabilities
Operational
EBITDA
Last twelve months (LTM) Twelve months
preceding the
reporting
date
1) Capital employed = Operating capital - Net tax liabilities
2) Average for the financial period
3) Attributable to owners of the Parent
For further information, please contact:
Jouko Karvinen, CEO, tel. +358 2046 21410
Karl-Henrik Sundström, CFO, tel. +46 1046 71660
Ulla Paajanen-Sainio, SVP, Investor Relations, tel. +358 2046 21242
Sanna Lahti, SVP, Global Communications, tel. +358 2046 21251
Stora Enso's first quarter 2013 results will be published on 23 April 2013 at
13.00 EET.
Annual General Meeting on 23 April 2013 at 16.00 EET.
PRESS CONFERENCE IN HELSINKI
Time: 14.00 local time today
Location: Marina Congress Center, Helsinki
Address: Katajanokanlaituri 6
Presentations: Jouko Karvinen, CEO (Finnish)
Karl-Henrik Sundström, CFO (English)
Questions can be addressed to Jouko Karvinen and Karl-Henrik Sundström after
the presentation.
ANALYST CONFERENCE CALL
CEO Jouko Karvinen, CFO Karl-Henrik Sundström and SVP Investor Relations Ulla
Paajanen-Sainio will be hosting a combined conference call and webcast today at
16.00 Finnish time (15.00 CET, 14.00 UK time, 09.00 US Eastern time).
If you wish to participate, please dial:
Continental Europe and the UK +44(0)20 7784 1036
Finland +358(0)9 6937 9543
Sweden +46(0)8 5051 3793
USA +1646 254 3361
Access code: 6160433
The live webcast may be accessed at www.storaenso.com/investors
Stora Enso is the global rethinker of the paper, biomaterials, wood products
and packaging industry. We always rethink the old and expand to the new to
offer our customers innovative solutions based on renewable materials. Stora
Enso employs some 28 000 people worldwide, and our sales in 2012 amounted to
EUR 10.8 billion. Stora Enso shares are listed on NASDAQ OMX Helsinki (STEAV,
STERV) and Stockholm (STE A, STE R). In addition, the shares are traded in the
USA as ADRs (SEOAY) in the International OTCQX over-the-counter market.
It should be noted that certain statements herein which are not historical
facts, including, without limitation those regarding expectations for market
growth and developments; expectations for growth and profitability; and
statements preceded by “believes”, “expects”, “anticipates”, “foresees”, or
similar expressions, are forward-looking statements within the meaning of the
United States Private Securities Litigation Reform Act of 1995. Since these
statements are based on current plans, estimates and projections, they involve
risks and uncertainties, which may cause actual results to materially differ
from those expressed in such forward-looking statements. Such factors include,
but are not limited to: (1) operating factors such as continued success of
manufacturing activities and the achievement of efficiencies therein, continued
success of product development, acceptance of new products or services by the
Group's targeted customers, success of the existing and future collaboration
arrangements, changes in business strategy or development plans or targets,
changes in the degree of protection created by the Group's patents and other
intellectual property rights, the availability of capital on acceptable terms;
(2) industry conditions, such as strength of product demand, intensity of
competition, prevailing and future global market prices for the Group's
products and the pricing pressures thereto, price fluctuations in raw
materials, financial condition of the customers and the competitors of the
Group, the potential introduction of competing products and technologies by
competitors; and (3) general economic conditions, such as rates of economic
growth in the Group's principal geographic markets or fluctuations in exchange
and interest rates.
www.storaenso.com
www.storaenso.com/investors
STORA ENSO OYJ
© 2024 Nasdaq, Inc. All Rights Reserved |