2011-10-26 08:30:00 CEST
2011-10-26 08:31:00 CEST
REGULATED INFORMATION
UPM-Kymmene - Interim report (Q1 and Q3)
UPM's Q3 operating profit excluding special items EUR 136 million - delivery volumes fell and cost level peaked, strong operating cash flow continued
(UPM, Helsinki, 26 October 2011 at 9:30 EET) - Interim report for
January-September 2011:
Q3/2011
-- Earnings per share excluding special items were EUR 0.19 (0.28), and
reported EUR -0.21 (0.34)
-- EBITDA was EUR 331 million, 12.7% of sales (384 million, 16.6% of sales)
-- Delivery volumes turned down and variable costs reached the peak
-- Operating cash flow continued solid at EUR 285 million
Q1-Q3/2011:
-- Earnings per share excluding special items were EUR 0.77 (0.72), and
reported EUR 0.68 (0.80)
-- EBITDA was EUR 1,082 million, 14.7% of sales (1,025 million, 15.6% of
sales)
-- Myllykoski acquisition was completed and a major restructuring plan
announced
-- Balance sheet is strong even after the Myllykoski acquisition
Key figures Q3/201 Q3/201 Q1-Q3/20 Q1-Q3/20 Q1-Q4/20
1 0 11 10 10
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Sales, EURm 2,603 2,312 7,382 6,567 8,924
EBITDA, EURm 1) 331 384 1,082 1,025 1,343
% of sales 12.7 16.6 14.7 15.6 15.0
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Operating profit (loss), EURm -159 238 328 548 755
excluding special items, EURm 136 204 535 519 731
% of sales 5.2 8.8 7.2 7.9 8.2
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Profit (loss) before tax, EURm -188 199 323 462 635
excluding special items, EURm 107 165 462 433 611
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Net profit (loss) for the period, -109 178 355 417 561
EURm
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Earnings per share, EUR -0.21 0.34 0.68 0.80 1.08
excluding special items, EUR 0.19 0.28 0.77 0.72 0.99
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Operating cash flow per share, EUR 0.54 0.63 1.40 1.23 1.89
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Shareholders' equity per share at 13.78 13.28 13.78 13.28 13.64
end of period, EUR
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Gearing ratio at end of period, % 52 51 52 51 46
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Net interest-bearing liabilities 3,758 3,553 3,758 3,553 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:
“During the third quarter UPM's delivery volumes fell while variable costs
reached a peak level. These coinciding events impacted on our operating profit.
Particularly the lower pulp and fine paper deliveries in Europe had an adverse
impact on the operating profit”.
“On a positive note, our strong performance in terms of operating cash flow
continued. Myllykoski integration proceeded well and the magazine paper
business showed solid performance. The demand for publication papers was stable
and, during the quarter, we were able to increase paper prices by 1-2%. Also,
the Label and Plywood businesses were able to implement price increases.
However, this was not sufficient to offset the rise in variable costs during
the third quarter. While the cost level still remains high, we estimate that we
have now reached the peak and variable costs are expected to start gradually
decreasing”.
“We are prepared for a heavy winter. There is already a clear decline in demand
in Europe for our timber and plywood businesses. However, UPM is in a much
better position to respond to the rough economic climate compared to 2008”.
“The strategic acquisitions of the Fray Bentos mill and the Myllykoski have
further improved our cost competitiveness and cash flow generation. Our net
debt increased only EUR 205 million year-on-year. Our balance sheet is strong,
which gives us opportunities to consider further strategic moves”.
“As announced after the Myllykoski acquisition, we have plans in place to
reduce 1.3 million tonnes of paper capacity in Europe and gain annual cost
synergies worth EUR 200 million. We are prepared to adopt flexible production
operations in various businesses, if needed, and will continue our stringent
cost control and strict investment policy. All in all, UPM is well prepared to
face any economic scenario”, Pesonen concludes.
Outlook for 2011
Economic outlook has turned weaker during the second half of the year. As a
result, demand for UPM's products for the rest of the year is lower than
earlier anticipated.
Price outlook for UPM's products is mostly stable for the rest of the year and
variable costs are anticipated to start gradually to decrease during the fourth
quarter of 2011 from the peak level reached in the third quarter of 2011.
UPM's full-year 2011 operating profit excluding special items is expected to be
somewhat lower than last year. Previously, the full year 2011 operating profit
excluding special items was expected to improve from last year.
*****
The complete Interim Report is available on the company website at www.upm.com
UPM will publish the Financial Review for 2011 on 1 February 2012.
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
www.twitter.com/UPM_News
**********
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 26
October at 13:00 Finnish time (11:00 GMT, 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 26
October, at 14:15 Finnish time (12:15 GMT, 07:15 EST).
Conference call and webcast details:
You can participate in the conference call either by dialing 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 dialing in 5-10 minutes beforehand to
ensure the conference starts timely.
Conference call title: UPM-Kymmene Corporation Interim Report January-September
2011
Conference ID: 891583
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 - 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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