2015-02-12 07:00:00 CET
2015-02-12 07:00:17 CET
REGULATED INFORMATION
Munksjö Oyj - Financial Statement Release
Munksjö Oyj's Financial Statements Bulletin 2014: Strong result and completed integration project
Helsinki, Finland, 2015-02-12 07:00 CET (GLOBE NEWSWIRE) --
MUNKSJÖ OYJ, FINANCIAL STATEMENTS BULLETIN 12 February 2015 at 7:00 a.m. CET
Munksjö Oyj's Financial Statements Bulletin 2014: Strong result and completed
integration project
Highlights of the fourth quarter 2014
- Net sales were EUR 281.0 (255.7) million. The increase in net sales was due
to organic growth and the business combination between Munksjö AB and Ahlstrom
Corporation's business area Label and Processing completed in 2013.
- Adjusted EBITDA was EUR 28.4 (16.0) million and the adjusted EBITDA margin
was 10.1% (6.3%).
- Operating result adjusted for non-recurring items was EUR 14.4 (2.6) million.
Non-recurring items amounted to EUR -3.7 (-16.6) million. The majority of the
non-recurring items were costs related to the reorganisation of the sales
organisation, communicated in the quarter.
- Operating result was EUR 10.7 (-14.0) million and net result EUR 2.7 (-26.2)
million.
- Trading in Munksjö's shares on Nasdaq Stockholm started on Monday 8 December
2014. The purpose of the secondary listing is to facilitate trading in
Munksjö's shares for both current and new shareholders.
Highlights of January-December 2014
- Net sales were EUR 1,137.3 (863.3) million. The substantial increase in net
sales was primarily due to the business combination between Munksjö AB and
Ahlstrom Corporation's business area Label and Processing completed in 2013.
- Adjusted EBITDA was EUR 105.0 (55.0) million and the adjusted EBITDA margin
was 9.2% (6.4%). The positive result development is primarily due to the
synergy benefits, volume growth and a lower cost base.
- Operating result adjusted for non-recurring items was EUR 51.0 (15.7)
million. Non-recurring items amounted to EUR -5.6 (-49.1) million.
- Operating result was EUR 45.4 (-33.4) million and net result EUR 7.7 (-57.4)
million. Net result was affected by a previously capitalised financing cost of
EUR 7.1 million, expensed in connection with the repayment of the existing
financing in the third quarter of 2014. The cost had no impact on cash flow.
- Earnings per share (EPS) were EUR 0.14 (-1.97).
- Interest-bearing net debt at the end of the reporting period was EUR 225.6
million (31 December 2013: 229.3), equivalent to a gearing of 54.5% (31
December 2013: 54.1%).
- Operating cash flow was EUR 57.8 (45.7) million.
- The project team responsible for the monitoring of the integration efforts
and synergy benefits brought the project to conclusion by December 2014, one
year ahead of schedule.
- The Board of Directors proposes to the AGM that EUR 0.25 per share be paid to
the shareholders as return of equity from the reserve for invested
non-restricted equity.
KEY FIGURES (MEUR) Oct-Dec Jan-Dec
2014 2013 2014 2013
Net sales 281.0 255.7 1,137.3 863.3
EBITDA (adj.*) 28.4 16.0 105.0 55.0
EBITDA margin, % (adj.*) 10.1 6.3 9.2 6.4
EBITDA 24.7 -0.6 99.4 5.9
EBITDA margin, % 8.8 -0.2 8.7 0.7
Operating result (adj.*) 14.4 2.6 51.0 15.7
Operating margin, % (adj.*) 5.1 1.0 4.5 1.8
Operating result 10.7 -14.0 45.4 -33.4
Operating margin, % 3.8 -5.5 4.0 -3.9
Net result 2.7 -26.2 7.7 -57.4
Earnings per share (EPS), EUR 0.05 -0.61 0.14 -1.97
Interest-bearing net debt** 225.6 229.3 225.6 229.3
* Adjusted for non-recurring items
** Restated to reflect the adoption of IFRS 11 as explained in the notes to the
interim report
Comment from Munksjö's President and CEO, Jan Åström
“During 2014 Munksjö refocused from integration and transformation to bringing
the integration process to completion, increasing the cash flow and improving
profitability. Three of the four business areas increased the volume reflecting
the annual average growth expectation of the various product segments. In terms
of volumes, the year 2014 was positive, showing an increase of about 2 per cent
as compared to the previous year. For the business areas Decor, Release Liners
and Industrial Applications, the total volume growth was approximately 3 per
cent. The volume development within Graphics and Packaging has been affected by
the continuous work with adjusting the product mix to strengthen the business
area's competitiveness. Our financial performance was positive and as expected.
As our net currency exposure is relatively low, the recent exchange rate
developments have had no significant effect on the result.
The efforts and initiatives to achieve an EBITDA margin of 12 per cent at the
end of 2016 continued during the year. The four business areas announced their
respective target margins and related projects in the last quarter of the year.
To achieve these goals, determined efforts were made to continue organic
growth; reinforce market positions in the existing product segments, strengthen
positions in emerging markets, continue the adjustments of the cost structure
and measures to improve efficiency in production, and further develop the
technical service offering.
I feel very happy that Munksjö today is back on Nasdaq Stockholm. The dialogue
with institutional and private investors in Sweden remains active and we are
looking forward to also show the Swedish shareholders what intelligent paper
technology is about.
The project team responsible for monitoring the integration efforts and synergy
benefits brought the project to conclusion by December 2014, one year ahead of
schedule. At the end of the year, the annual synergy benefits from the business
combination were EUR 26 million, which exceeds the range of EUR 20-25 million
established as the target.
The market prospects for the year 2015 are stable both in terms of order stocks
and prices. Our efficient organisation, strong product portfolio and close
customer relations create a sound basis for long-term success.”
Outlook
The demand outlook of specialty paper products for 2015 is stable.
The market situation and demand for Munksjö's products are expected to remain
stable during the first quarter of 2015 following a seasonally somewhat weaker
fourth quarter of 2014. Prices of Munksjö's specialty paper products in local
currencies are expected to remain at the same level as in 2014 during the first
quarter of 2015.
The annual maintenance and vacation shutdowns in the second and third quarter
as well as the seasonal shutdowns at the end of 2015 are expected to be carried
out to about the same extent as in 2014.
The business areas will during 2015 continue to work on the ongoing programmes
to achieve their respective profitability targets at the end of 2016.
The project aiming to achieve the annual synergy benefits from the business
combination was completed in December 2014 and the achieved synergy benefits
level of EUR 26 million at the end of 2014 is expected to have a full effect on
the financial result for the full year 2015.
The new financing agreement signed in September 2014 is expected to reduce the
cost of financing in 2015. At leverage levels and financial ratios at the time
of the signing, the annual saving amounts to approximately EUR 5 million of
reduced financial expenses. The previously capitalised financing cost of EUR
7.1 million was expensed in 2014. No such cost is expected to occur and affect
the result in 2015.
Synergy benefits and integration
At the end of the fourth quarter, the annual synergy benefits run rate derived
from the business combination reached EUR 26 million, exceeding the previously
communicated target of EUR 20-25 million. Of the annual synergy benefits
arising from the business combination, procurement accounted for about 50 per
cent, improved organisational efficiency for about 40 per cent while the rest
was achieved through economies of scale and production efficiency.
The result for the fourth quarter of 2014 includes realised synergies of EUR
6.5 million. The full-year result for 2014 includes realised synergies of EUR
23.0 million. The project team responsible for monitoring the integration
efforts and synergy benefits brought the project to conclusion by December
2014, one year ahead of schedule.
The non-recurring costs for implementing the integration and achieving the
synergy benefits were lower than estimated with a one-off revenue of EUR 1.5
million recognised in the fourth quarter. As a result, the total non-recurring
items were EUR 10.0 million, representing the lower end of the previously
communicated range of EUR 10-15 million. The cash flow effect was EUR -0.5
million in the fourth quarter.
The table below shows the quarterly development of synergies, non-recurring
items and their impact on cash flow.
MEUR Annual synergy run rate Realised Non-recurring Cash flow effect of
at the end of the synergies costs per non-recurring costs
reporting period in result quarter per quarter
per
quarter
Q2-Q4/ 11.0 5.0 11.0 -4.0
2013
Q1/201 20.0 5.0 0.5 -1.5
4
Q2/201 23.0 5.5 - -1.0
4
Q3/201 25.0 6.0 - -1.0
4
Q4/201 26.0 6.5 -1.5 -0.5
4
The Munksjö Group
Oct-Dec Jan-Dec ACQUIRED Oct-De 27 OPERATIONS c May-Dec
MEUR 2014 2013 2014 2013 MEUR 2013 2013
Reported 1) Reported 1)
Net sales 281.0 255.7 1,137.3 863.3 Net sales 105.0 257.0
EBITDA 28.4 16.0 105.0 55.0 EBITDA 3.6 6.9
(adj.*) (adj.*)
EBITDA 10.1 6.3 9.2 6.4 EBITDA 3.4 2.7
margin, % margin, %
(adj.*) (adj.*)
EBITDA 24.7 -0.6 99.4 5.9 EBITDA -3.6 -3.5
EBITDA, 8.8 -0.2 8.7 0.7 EBITDA, -3.4 -1.4
margin % margin %
Operating 14.4 2.6 51.0 15.7 Operating -1.9 -4.9
result result
(adj.*) (adj.*)
Operating 5.1 1.0 4.5 1.8 Operating -1.8 -1.9
margin, % margin, %
(adj.*) (adj.*)
Operating 10.7 -14.0 45.4 -33.4 Operating -9.1 -15.3
result result
Operating 3.8 -5.5 4.0 -3.9 Operating -8.7 -6.0
margin, % margin, %
Net result 2.7 -26.2 7.7 -57.4 Delivery 90,900 223,400
volumes,
tonnes
Capital 4.6 8.2 35.1 22.6
expenditure
Employees, 2,757 2,641 2,765 2,216
FTE
Pro forma 2)
Net sales 281.0 265.2 1,137.3 1,120.3
EBITDA** 28.4 16.8 105.0 64.1
(adj.*)
EBITDA** 10.1 6.3 9.2 5.7
margin, %
(adj.*)
EBITDA** 24.7 1.0 99.4 42.3
EBITDA**, 8.8 0.4 8.7 3.8
margin %
Delivery 221,600 208,900 899,400 885,300
volumes,
tonnes
* Adjusted for non-recurring items
** Includes stand-alone cost savings and synergies obtained after 27 May 2013
1) Includes LP Europe from 27 May 2013 and Coated Specialties from 2 December
2013
2) Includes LP Europe and Coated Specialties from 1 January 2012. As the
combination was completed during 2013, the pro forma information is only
consolidated until the fourth quarter 2013. From the first quarter 2014 the
reported figure is used.
Reported
Fourth quarter 2014
Net sales were EUR 281.0 (255.7) million. The improvement in net sales was due
to organic growth and the business combination between Munksjö AB and Ahlstrom
Corporation's business area Label and Processing completed in 2013.
EBITDA adjusted for non-recurring items increased to EUR 28.4 (16.0) million
and the adjusted EBITDA margin was 10.1% (6.3%). Non-recurring items amounted
to EUR -3.7 (-16.6) million. Of these costs, EUR 1.0 million were related to
previous business combinations, primarily the commitment to pay costs arising
from the divestments of certain businesses in Osnabrück, Germany (in connection
with the business combination in 2013), EUR 2.7 million to costs for the
reorganisation of the sales organisation communicated in the fourth quarter
2014 and EUR 1.5 million to other reorganisation activities. The non-recurring
costs for implementing the integration and achieving the synergy benefits were
lower than estimated and a one-off income of EUR 1.5 million was recognised.
The extent of the seasonal shutdowns at the end of December is described
separately for each business area.
Operating result adjusted for non-recurring items was EUR 14.4 (2.6) million
and the adjusted operating margin 5.1% (1.0%). The operating result was EUR
10.7 (-14.0) million and net result EUR 2.7 (-26.2) million.
January-December 2014
Net sales were EUR 1,137.3 (863.3) million. The substantial improvement in net
sales was primarily due to the business combination between Munksjö AB and
Ahlstrom Corporation's business area Label and Processing completed in 2013.
EBITDA adjusted for non-recurring items increased to EUR 105.0 (55.0) million
and the adjusted EBITDA margin was 9.2% (6.4%). The positive result development
is primarily due to the synergy benefits, volume growth and a lower cost base.
Non-recurring items amounted to EUR -5.6 (-49.1) million. Of these costs, EUR
1.4 million were related to the work in connection with the Statement of
Objections from the European Commission, EUR 1.0 million to previous business
combinations, primarily the commitment to pay costs arising from the divestment
of certain businesses in Osnabrück, Germany (in connection with the business
combination in 2013) and EUR 3.2 million to costs for other reorganisation
activities. Of these costs, EUR 2.7 million were related to the reorganisation
of the sales organisation, communicated in the fourth quarter 2014.
The annual maintenance and vacation shutdowns in the second and third quarter,
during which planned maintenance operations were scheduled, were carried out to
the same extent as in 2013, with the exception of the business area Graphics
and Packaging, where the shutdowns in 2014 at this business area's two
production facilities were extended by approximately one week. The extent of
the seasonal shutdowns at the end of December is described separately for each
business area.
Operating result adjusted for non-recurring items was EUR 51.0 (15.7) million
and the adjusted operating margin 4.5% (1.8%). The operating result was EUR
45.4 (-33.4) million and net result EUR 7.7 (-57.4) million.
Net result was affected by a previously capitalised financing cost of EUR 7.1
million, expensed in connection with the repayment of the existing financing in
the third quarter of 2014.
Reported figures compared to pro forma figures
Fourth quarter 2014
Net sales were EUR 281.0 (265.2) million.
Adjusted EBITDA increased to EUR 28.4 (16.8) million and the adjusted EBITDA
margin was 10.1% (6.3%).
The extent of the seasonal shutdowns at the end of December is described
separately for each business area.
January-December 2014
Net sales were EUR 1,137.3 (1 120.3) million.
EBITDA adjusted for non-recurring items increased to EUR 105.0 (64.1) million
while the adjusted EBITDA margin was 9.2% (5.7%).
The annual maintenance and vacation shutdowns in the second and third quarter,
during which planned maintenance operations were scheduled, were carried out to
the same extent as in 2013, with the exception of the business area Graphics
and Packaging, where the shutdowns in 2014 at this business area's two
production facilities were extended by approximately one week. The extent of
the seasonal shutdowns at the end of December is described separately for each
business area.
The result for the first quarter of 2013 included a positive impact on the
result of around EUR 3 million which was due to the release of certain accruals
related to personnel liabilities.
Webcast and conference call
A combined news conference, conference call and live webcast for investors,
analysts and media will be arranged on the publishing day 12 February 2015 at
10:00 am CET (11:00 am EET, 9:00 am UK time) at restaurant Savoy, room
Kabinetti 2 (Eteläesplanadi 14, 7th floor, Helsinki). The report will be
presented by President and CEO Jan Åström. The event will be held in English.
The conference call and live webcast can be followed on the Internet and an
on-demand version of the webcast will be available on the same webpage later
the same day. To join the conference call, participants are requested to dial
one of the numbers below 5-10 minutes prior to the start of the event.
Webcast and conference call information
Finnish callers: +358 (0)9 2313 9201
Swedish callers: +46 (0)8 5052 0110
US callers: +1 334 323 6201
UK callers: +44 (0)20 7162 0077
Conference ID: 950741
Link to the webcast: http://qsb.webcast.fi/m/munksjo/munksjo_2015_0212_q4/
For further information, please contact
Jan Åström, President and CEO, Tel. +46 10 250 1001
Kim Henriksson, CFO, Tel. +46 10 250 1015
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