Press release
5 May 2022, 7:00 CET

Interim report January–March 2022

Continued strong growth and all-time high profitability     


  • Strong sales growth and stable production
  • All-time high EBITDA
  • Pricing impact and mix improvements more than offset cost inflation
  • Acquisition of Verso successfully completed
  • Excellent Verso stand-alone performance


  • Net sales grew by 13% to SEK 7 397 million  (6 520). Excluding currency effects net sales increased by 11%
  • Adjusted EBITDA* increased to SEK 1 664 million (1 003), corresponding to an adjusted EBITDA margin of 22% (15%)
  • Operating profit was SEK 1 189 million (528), 
  • Net profit was SEK 884 million (377) 
  • Earnings per share amounted to SEK 4.27 (1.82)


  • Strong market conditions in all product segments expected to prevail
  • Accelerated cost inflation for fibre, chemicals, transports, and energy – which we expect to fully offset by pricing and mix improvements 

Comments by the CEO

Quarter one was the first quarter fully focused on our new strategy. Despite all the macro-economic uncertainties further exasperated by the Russian war, we believe that our prioritisation on paperboard and growth opportunities in North America remain the right choices. We have made progress in the implementation of the strategy with the acquisition of Verso and its closure in the first quarter and the signing of a term sheet for a joint venture with Viken Skog to explore opportunities for pulp production. The organisation has been very focused on all key elements of the strategy, resulting in an excellent business performance in the first quarter.

Net sales excluding currency effects and adjusted for the divestment of Beetham grew by 13%. The all-time high EBITDA in the quarter was a result of implemented price increases and mix improvements, which more than offset higher costs for raw materials and transports.

We strongly condemn Russia’s brutal war in Ukraine and our thoughts are with all those suffering. While our sales exposure to Russia and Ukraine was only 1% in 2021, the impact on our business is mainly indirect. Wood supply and prices have been affected by the stop of imported Russian wood. Chemical prices are on the rise as a secondary consequence of energy price hikes. These effects have been in addition of the already tight market situation due to corona and logistics disruption.

For 2022, we expect the strong market conditions to prevail. Despite the more uncertain macro-economic outlook in our main markets, we are confident that most of our products target very resilient end-segments. Market conditions are also expected to remain strong in North America.
We will counteract the inflationary pressure by continued focus on price management, product mix adjustments, and efficiency improvements. For the second quarter, we expect to fully offset the cost inflation.

The acquisition of Verso was completed on 31 March. Our offering now includes a very profitable graphic and speciality paper business in the U.S. in addition to our current business. Our strategy to transform the North American operations towards paperboard remains very attractive and will add significant shareholder value. Verso has been consolidated in our balance sheet as of 31 March 2022. Our interest-bearing net debt to adjusted EBITDA ratio of 2.3. and adjusted ROCE of 11% will improve going forward.

Verso’s financial performance in the last six months has been impressive and we are very pleased that the closure of the transaction happened earlier than we expected. We are welcoming our new colleagues and are looking forward to working together. As part of the integration, we have decided to propose to the AGM to simplify the company name and brand to Billerud. We are also initiating preparations for the planned conversion to create a world-class paperboard production in North America. In this work, we will use competencies in both organisations and lessons learned from previous projects, such as our recent brownfield projects at Frövi and Gruvön.

Our priorities for 2022 remain to be delivering on our strategy, mix improvements, cost saving programme and as of now to integrate the North American operations. Uncertainties will remain high for the foreseeable future. Our organisation remains fully committed to mitigate any risk through proactive preparation and agile responses.

We sincerely hope that the war between Russia and the Ukraine will stop as soon as possible. In the meanwhile, BillerudKorsnäs has contributed to UNHCR to support the refugees from Ukraine.

Christoph Michalski
President and CEO

The quarter in review                        

Net sales for the first quarter increased by 13% to SEK 7 397 million (6 520). Net sales excluding currency effects increased by 11%, despite lower volumes due to the divestment of Beetham on 31 October 2021 and UPM’s strike which affected the production at Pietarsaari during the first quarter. The Beetham mill had sales of SEK 102 million in the first quarter 2021.

Adjusted EBITDA strengthened to SEK 1 664 million (1 003). The improvement was the result of implemented price increases, an improved product mix, mainly driven by the ramp-up at Gruvön, and the continued focus on efficiency. Higher costs for chemicals, logistics and fibre had an adverse effect.

No items affecting comparability impacted the result in the first quarter (–).

Market development AND OUTLOOK
During the first quarter of 2022, market conditions continued to be strong for all product segments. Implemented price increases had effect across all segments.

The market outlook for the second quarter in 2022 is positive. The strong market conditions in all product segments are expected to prevail. Substantially higher costs for fibre, chemicals, energy and transports are anticipated. BillerudKorsnäs expects to fully offset the cost inflation with further price increases and mix improvements.

events in the quarter
BillerudKorsnäs’ production in Pietarsaari has from 1 January 2022 been affected by the strike at UPM’s pulp mill, which supplies the operation with pulp, purified water, steam and compressed air. The production at Pietarsaari has run at lower capacity and we have sourced pulp from other suppliers. The negative impact of the strike on the first quarter result amounted to around SEK 15 million.

The annual maintenance shutdown at Gruvön started in the last week of March. The total maintenance costs in the first quarter amounted to around SEK 80 million.

On 3 March, it was announced that BillerudKorsnäs and the Norwegian forest owner group Viken Skog form a joint venture to explore the possibilities of working together to establish production of bleached chemi-thermomechanical pulp (BCTMP) at Viken Skog’s Follum mill in Hønefoss. A feasibility study about future pulp production at Follum will be initiated and is estimated to be completed during the first half of 2023. The intention is to establish a state-of-the-art production line for BCTMP with a capacity assumption of up to 200 ktonnes per year. The Follum mill already has much of the infrastructure needed to establish such a production line and is located in an area with competitive and sustainable wood supply and good transports to BillerudKorsnäs’ board mills. If the project will proceed after the feasibility study, the investment for BillerudKorsnäs is estimated to be around NOK 600–800 million.

The Nomination Committee announced on 10 March that it will propose Magnus Nicolin and Florian Heiserer as new Board members at the 2022 Annual General Meeting. The Nomination Committee further proposes re-election of the Board members Andrea Gisle Joosen, Bengt Hammar, Jan Svensson, Jan Åström and Victoria Van Camp, and re-election of Jan Svensson as Chairman of the Board. Michael M.F. Kaufmann, Kristina Schauman and Tobias Auchli have declined re-election at the 2022 Annual General Meeting.

On 11 March, a special meeting of Verso’s shareholders was held, during which holders of the requisite majority of Verso’s outstanding shares of common stock voted to adopt the merger agreement between BillerudKorsnäs and Verso, and to approve the transaction. On 29 March, the remaining regulatory approvals for BillerudKorsnäs’ acquisition of Verso had been received.

On 31 March, the acquisition of Verso was completed for a purchase price of USD 27.00 per share. The acquisition reinforces BillerudKorsnäs’ strategy to drive profitable and sustainable growth and its ambition to accelerate growth in North America. BillerudKorsnäs is thereafter one of the largest providers of virgin paper and packaging materials with a cost and quality advantage. For more information about the acquisition of Verso and its financial impact see pages 8-9 and page 18.

On 31 March, it was also communicated that Rob Kreizenbeck, Verso’s SVP of Operations, as of 1 April 2022 will assume the position of President, North America and become a member of BillerudKorsnäs’ Executive Management Team. It was furthermore announced that BillerudKorsnäs intends to simplify its company name and brand to Billerud. The Board of Directors proposes that the 2022 AGM resolves to amend the company’s name to Billerud AB (publ), and the change will be successively implemented thereafter.

events AFTER the quarter
In the convening notice to the 2022 Annual General Meeting, published on 8 April, the Board of Directors proposes that the Board shall be authorised by the AGM to, for a period up until the end of next annual general meeting, resolve on an issue of shares with preferential right for the shareholders amounting to maximum SEK 3.5 billion. The proceeds from the rights issue will be used to repay a part of the debt which was raised in conjunction with the acquisition of Verso.

BillerudKorsnäs’ four largest shareholders, AMF Pension and Funds, Frapag Beteiligungsholding, The Fourth Swedish National Pension Fund and Swedbank Robur Funds, which together hold around 37.6% of BillerudKorsnäs’ share capital, have expressed their intention to vote for the rights issue and subscribe for their pro rata share. Danske Bank and SEB, acting as financial advisors to BillerudKorsnäs in relation to the rights issue, have confirmed their commitment, subject to customary conditions and to BillerudKorsnäs obtaining binding subscription commitments for at least 25% of the rights issue, to enter into an underwriting agreement in connection with the rights issue. The rights issue will, by way of the shareholder commitments and the underwriting banks, be fully covered.

On 22 April, the strike at UPM, which has negatively impacted the paper production at Pietarsaari, ended. BillerudKorsnäs will return to full production at Pietarsaari as soon as possible.

For further information, please contact:
Ivar Vatne, CFO, +46 8 553 335 07
Lena Schattauer, Head of Investor Relations, +46 8 553 335 10

This information constituted inside information prior to publication. This is information that BillerudKorsnäs AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 07.00 CET on 5 May 2022.