Press release
7 Feb 2002, 13:36 CET

Financial statement january-december 2001

FINANCIAL STATEMENT January-December 2001 (All financial information relating to 2000 is pro forma) Quarter Full year 2001 2001 2000 IV III IV 2001 2000 Net turnover, MSEK 1, 735 1, 593 1,770 6,910 6,666 Operating profit, MSEK 265 246 386 1,299 1,384 Operating margin, % 15 15 22 19 21 Profit after financial 230 217 -1) 1,181 1,254 items, MSEK Earnings per share. SEK 2.98 2.45 -1) 13.81 14.40 1) Historical data not available · Market demand was stable in the final quarter, but paper prices continued to fall. · Operating profit in the final quarter was MSEK 19 or 8% higher than the third quarter, due to increased deliveries. · Operating profit for the full year reached MSEK 1,299 (1,384). After adjustments for non-comparable items, the full year result was MSEK 1,346 (1,348). · Synergy benefits from the formation of Billerud are calculated to have a positive effect on results of MSEK 55. · Return on capital employed amounted to 27% (30).adjusted for non- comparable items the return was 28% (29). · The Billerud share was listed for the first time on 20 November 2001. · The Board proposes a dividend of SEK 3.50 per share. · The Board proposes a buy-back of Billerud shares. · Billerud's CEO Bert Östlund will present this financial statement at Operaterrassen in Stockholm today at 3 p.m. To participate, please call +46 8 562 08 60 or send an email to Live telephone conference today at 3 p.m. on +44 20 8241 0004. See a film presentation of the conference on from 9 p.m. today. Billerud Group Market Demand for Billerud's products was relatively stable during the year with total delivery volumes at the same level as the previous year. The market for Billerud's packaging paper was strong at the beginning of the year, but subsequently weakened gradually. Price reductions were implemented in local currencies but this was offset by the weakening of the Swedish krona. Deliveries of containerboard and market pulp increased compared with 2000, while deliveries of kraft paper decreased. Demand for market pulp was low throughout the year. Production curtailments by pulp producers meant that stocks fell up to October. However, production picked up during the final months of the year and stocks rose. The price of long-fibre market pulp fell from USD 710 per tonne at the beginning of the year to USD 450 per tonne at the end of September. Prices then rallied a little, but as stocks were built up prices fell back again at the end of the year. Due to the demand situation, Billerud implemented production curtailments of around 25,000 tonnes during the year, of which around 5,000 tonnes were in the final quarter. Sales and results Fourth quarter Net turnover for the period amounted to MSEK 1,735, an increase of 9% compared with the third quarter. Higher turnover is explained by an 11% increase in deliveries as prices fell. Operating profit amounted to MSEK 265, an increase compared with the previous quarter of MSEK 19 or 8%. The increase was mainly due to higher delivery volumes. Comments on the earnings trend for each product area are provided on page 5. Net financial items amounted to MSEK -35. Earnings for the quarter were charged with non-recurring costs of MSEK 14 for the refinancing of loans, which is described on page 4. Full year 2001 Compared with 2000, net turnover increased by 4% and amounted to MSEK 6,910. The higher turnover was attributable to approximately unchanged average prices for kraft paper and containerboard (in EUR and USD) and the weakened Swedish krona. This was partly offset by lower prices for market pulp. In total, deliveries increased by 1% compared with 2000. The operating profit of MSEK 1,299 was MSEK 85 or 6% lower than the figure for 2000. On average, prices (expressed in SEK) increased for Billerud's paper products, which account for around 80% of sales. The effect of higher prices was offset, however, by reduced pulp prices and higher costs, mainly due to higher wood and chemical prices. Overall, the weakness of the Swedish krona in 2001 had a positive effect of around MSEK 400 on the operating profit compared with the previous year. Earnings were charged with MSEK 47 in non-recurring costs for the formation of Billerud and the stock-exchange listing. In the previous year, an MSEK 36 repayment of funds was received from SPP. Adjusted for these two non-comparable items, the operating profit amounted to MSEK 1,346 (MSEK 1,348 in 2000). Net financial items, amounting to MSEK -118, related primarily to interest paid at market rates on loans from the company's owners and to interest and expenses for Billerud's syndicated loans, MSEK 14. The estimated tax charge was MSEK 314. Deferred tax income was recorded in the final quarter, and the tax charge for the full year corresponds to a tax rate of 27%. Return on capital employed amounted to 27%, compared with 30% in 2000. Return on equity was 32%. Synergies In connection with the formation of Billerud, synergy effects of around MSEK 200 were forecast. To achieve this, a streamlining project was started early in the year (transferring products and getting better use out of existing equipment). This will boost profits by at least MSEK 170 by the end of 2003. An additional MSEK 30 in cost synergies will be obtained, making a total synergy benefit of MSEK 200 by the end of 2003. During 2001 the synergy benefit is calculated to amount to MSEK 55, consisting of MSEK 25 for the streamlining effect and MSEK 30 for cost synergies. Foreign exchange exposure 20% of the Group's sales are in Swedish krona (SEK). Invoicing in other currencies is primarily in EUR, USD and GBP. Most sales in SEK, however, are closely related to market pricing in other currencies, primarily USD. The Group's currency hedging takes these underlying flows into account. The majority of costs are in Swedish krona. The Group is therefore exposed to exchange rate fluctuations. In order to manage this, Billerud has hedged exchange rates as shown below. In December the Board decided to extend currency hedging to cover 15 months of estimated net flows. ------------------------------------------------------------ This information was brought to you by Waymaker The following files are available for download: The full year-end report The full year-end report