2011-08-03 08:31:00 CEST
2011-08-03 08:31:44 CEST
REGULATED INFORMATION
UPM-Kymmene - Interim report (Q1 and Q3)
UPM reports solid Q2 result despite challenging cost environment
Myllykoski acquisition gives UPM a unique momentum for profitability improvement
Helsinki, 2011-08-03 08:31 CEST (GLOBE NEWSWIRE) -- Interim report for
January-June 2011:
Q2/2011
-- Earnings per share were EUR 0.56 (0.33), excluding special items EUR 0.26
(0.29)
-- EBITDA was EUR 372 million, 15.4% of sales (353 million, 15.9% of sales)
-- Strong operating cash flow at EUR 280 million (102 million)
-- Took a major strategic step by completing the Myllykoski acquisition on 1
August 2011
Q1-Q2/2011:
-- Earnings per share were EUR 0.89 (0.46), excluding special items EUR 0.58
(0.44)
-- EBITDA was EUR 751 million, 15.7% of sales (641 million, 15.1% of sales)
-- Profitability improved clearly - sales prices more than offset the rise in
variable costs
-- Net debt was EUR 675 million lower than a year ago
Key figures Q2/201 Q2/201 Q1-Q2/20 Q1-Q2/20 Q1-Q4/20
1 0 11 10 10
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Sales, EURm 2,423 2,216 4,779 4,255 8,924
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EBITDA, EURm 1) 372 353 751 641 1,343
% of sales 15.4 15.9 15.7 15.1 15.0
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Operating profit, EURm 289 203 487 310 755
--------------------------------------------------------------------------------
excluding special items, EURm 201 199 399 315 731
% of sales 8.3 9.0 8.3 7.4 8.2
--------------------------------------------------------------------------------
Profit before tax, EURm 316 181 511 263 635
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excluding special items, EURm 160 177 355 268 611
--------------------------------------------------------------------------------
Net profit for the period, EURm 295 169 464 239 561
--------------------------------------------------------------------------------
Earnings per share, EUR 0.56 0.33 0.89 0.46 1.08
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excluding special items, EUR 0.26 0.29 0.58 0.44 0.99
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Operating cash flow per share, EUR 0.54 0.20 0.86 0.60 1.89
--------------------------------------------------------------------------------
Shareholders' equity per share at 13.81 13.33 13.81 13.33 13.64
end of period, EUR
--------------------------------------------------------------------------------
Gearing ratio at end of period, % 44 55 44 55 46
--------------------------------------------------------------------------------
Net interest-bearing liabilities 3,162 3,837 3,162 3,837 3,286
at end of period, EURm
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1) EBITDA is operating profit before depreciation, amortisation and impairment
charges, excluding the change in value of biological assets, excluding the
share of results of associated companies and joint ventures, and special items.
Jussi Pesonen, President and CEO, comments on the result:
“Our operating profit improved clearly during the first half of the year
despite the cost pressures. In the second quarter, we managed to maintain the
quarterly operating profit on a steady level and our EBITDA increased from last
year. We were able to offset the rise in variable costs through higher sales
prices.
Market demand seems to have stabilized and cost development is levelling off.
In these conditions the best way to make fundamental improvements in terms of
profitability is through determined consolidation and restructuring. The
Myllykoski acquisition gives UPM a unique momentum for profitability
improvement. Already during the initial integration planning the merits of the
transaction have been confirmed.
As the transaction is completed, UPM now has good prerequisites to maintain its
position as the frontrunner in the field. The new combination offers us
excellent opportunities to improve our cost competitiveness, also to the
benefit of our customers. Although the transaction is an important step towards
creating value in UPM's Paper Business, it does not serve as a solution for all
of the challenges faced by the industry's players.
Within a year we have succeeded in reducing our net debt by EUR 675 million. It
is testimony of a strong and solid operative cash flow. Our financial
flexibility for further strategic manoeuvres is good and we intend to continue
implementing strategic steps in our various businesses,” Pesonen concludes.
Outlook for 2011
Earnings guidance for 2011 remains unchanged. UPM operating profit excluding
special items for 2011 is expected to improve from last year. In the second
half of 2011, operating profit excluding special items is expected to be on
about the same level as in the first half of 2011. The earnings guidance
includes the acquired Myllykoski operations.
The broad-based solid demand growth in UPM's products experienced in the
previous quarters has levelled off. The demand outlook for UPM's products is
largely stable in the second half of 2011.
Variable cost increases seem to be moderating and only minor cost increases are
expected in the second half of the year compared with the first half. UPM has
achieved some price increases in the third quarter in publication papers,
self-adhesive labelstock and plywood, which are expected to broadly offset the
increases in variable costs.
*****
The complete Interim Report is available on the company website at www.upm.com
UPM will publish the Interim Report for January-September 2011 on 26 October
2011.
For more information please contact:
Mr Jussi Pesonen, President and CEO, UPM, tel. +358 204 15 0001
Mr Tapio Korpeinen, CFO, UPM, tel. +358 204 15 0004
UPM, Corporate Communications
Media Desk, tel. +358 40 588 3284
media@upm.com
Conference call and press conference
UPM's President and CEO Jussi Pesonen will present the Interim Report in a
conference call and webcast for analysts and investors, in English, on 3 August
at 13:00 Finnish time (11:00 BST, 06:00 EST).
Jussi Pesonen will also present the Interim Report in a press conference held
in Finnish at UPM Group Head Office in Helsinki, Eteläesplanadi 2, on 3 August,
at 14:15 Finnish time (12:15 BST, 07:15 EST).
Conference call and webcast details:
You can participate in the conference call either by dialling one of the
numbers from the list below or following the webcast online at www.upm.com.
Only participants who wish to ask questions in the conference call need to dial
in. All participants can view the webcast presentation online.
We recommend that participants start dialling in 5-10 minutes beforehand to
ensure the conference starts timely.
Conference call title: UPM-Kymmene Corporation Interim Report January-June 2011
Conference ID: 891580
Phone numbers:
Participant - UK: +44 (0)20 7162 0025
Participant - North America Freephone: +1 877 491 0064
Participant - India Freephone: 000 8001 0035 51
Participant - India Freephone: 000 8001 0035 51
Participant - Australia LC: +61 (0)28 2239 543
Participant - Hong Kong LC: +852 300 278 26
Participant - Japan LC: +81 (3)45 8001 94
Participant - Malaysia LC: +60 (0)37 7124 471
Participant - New Zealand LC: +64 (0)99 1924 18
Participant - Singapore LC: +65 6823 2169
Participant - South Korea LC: +82 (0)23 4831 070
Participant - Taiwan LC: +886 (0)22 1626 701
Participant - Austria: +43 (0)268 2205 6292
Participant - Belgium: +32 (0)2 290 14 07
Participant - Czech Republic: +420 (2)3900 0635
Participant - Denmark: +45 3271 4607
Participant - Finland: +358 (0)9 2313 9201
Participant - France: +33 (0)1 7099 3208
Participant - Germany: +49 (0)695 8999 0507
Participant - Hungary: +36 (0)618 8932 15
Participant - Ireland: +353 (0)1 4364 106
Participant - Italy: +39 023 0350 9003
Participant - Luxembourg: +352 270 0073 408
Participant - Netherlands: +31 (0)20 7965 008
Participant - Norway: +47 2156 312 0
Participant - Spain: +34 9178 8989 6
Participant - Sweden: +46 (0)8 5052 0110
Participant - Switzerland (Geneva): +41 (0)2 2592 7007
Participant - Switzerland (Zurich): +41 (0)434 5692 61
The webcast can be replayed at www.upm.com for 12 months.
***
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. 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 including the
availability and cost of production inputs, 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, and 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, 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.
UPM-Kymmene Corporation
Pirkko Harrela
Executive Vice President, Corporate Communications
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