Press release
25 Jan 2024, 7:00 CET

Year-end report January–December 2023

Strong cash flow and efficiency gains ends a 2023 heavily impacted by market headwind
Key highlights

  • Weak volumes in North America and negative price and mix impact in both regions 
  • Sequentially lower input costs, mainly related to pulpwood in Europe 
  • Another strong delivery of our efficiency enhancement program
  • Excellent cash delivery through working capital focus
  • Negative profit impact from revaluation of biological assets in the associated company BSÖ
  • The Board of Directors proposes a dividend of SEK 2.00 per share (7.50)

Quarterly data Q4

  • Net sales decreased by 20% to SEK 9,566 million (11,971)
  • Adjusted EBITDA* SEK 774 million (2,092)
  • Adjusted EBITDA margin 8% (17)
  • Operating loss SEK 191 million (profit: 1,353) including items affecting comparability of SEK -244 million (-52)
  • Net loss SEK 330 million (profit: 940)
  • Earnings per share SEK -1.33 (3.79)

Outlook for Q1

  • Market conditions expected to slightly improve from weak levels
  • Improved price positions in liquid packaging board more than offset price pressure in other categories
  • Increased total input costs
  • Positive impact from efficiency enhancement program

Comments by the CEO

2023 has been an extremely challenging year. Early in the year, we faced unusually high inventory levels throughout the value chain. The whole industry has needed to be patient and wait for the destocking to phase out. In that sense, the fourth quarter was no exception, and broadly in line with our expectations. Sales volumes came in somewhat softer due to customers protecting their working capital before year-end, and logistical challenges. The good news is, going into 2024, we see clear indications that customers’ inventories are returning to normalized levels.
The organic and currency-neutral net sales in the fourth quarter declined by 21% compared to the same period last year. Our input costs continued to decrease sequentially, mainly attributed to lower wood costs in Europe. However, low sales volumes in North America as well as deteriorated prices and unfavorable category mix in both regions led to an adjusted EBITDA margin of 8%, a performance we are not satisfied with.
We have maintained a strong focus on items we can influence in an unfavorable market environment. In this context, I’m proud of the results we have delivered throughout 2023. Our three-year efficiency enhancement program has excellent momentum, and we overdelivered on the 2023 target. I am also pleased with the outstanding cash flow conversion for the year of 99%, mainly driven by successful reduction of inventory levels. This enabled us to finish the year with a continued strong balance sheet. The Board proposes a dividend for 2023 of SEK 2.00 per share, 65% of the adjusted net profit.
For the first quarter of 2024, market conditions are expected to slightly improve from weak levels for most of our product categories. We will stay proactive in terms of price management as total input costs are expected to increase. For liquid packaging board, we have secured improved price positions for significant volumes, which will more than offset price pressure in other categories.
Going into 2024, we have three main priorities: 1) Proceed with the preparations for our strategic investment projects 2) Implement a selective strategy upgrade for Region Europe and 3) Continue to deliver EBITDA uplifts from our efficiency enhancement program.
We remain convinced about the opportunities to convert some of our paper assets to board production in the US, but the transformation must deliver strong shareholder value. We continue to tune the project scope and phasing in close dialogues with suppliers. Meanwhile, we are strengthening our market position for paperboard in North America through export from Europe. Our plans to start BCTMP (bleached chemi-thermomechanical pulp) production together with Viken Skog in Norway is also proceeding. We have completed the feasibility study and submitted the application for the necessary environmental permit.
We must be agile as Region Europe is facing a new reality of structurally higher input prices. Our clear aim is to improve profitability and maintain positive cash generation across all production units. We are determined to make bold moves to secure cost competitive fiber sourcing by entering new partnerships, applying technical improvements to reduce the consumption, and increasing our field wood purchasing. We also see substantial efficiency potential in the way we work and operate across our high-quality mills.
We have several sizable building blocks for 2024 within our efficiency enhancement program. For example, we will rearrange and optimize our outbound logistics structure in Europe. The process to reduce our workforce by 350 positions is ongoing and will provide structural savings already this year. The efficiency enhancement program is in total expected to deliver an additional EBITDA uplift of SEK 700 million by the end of 2024. 
For 2024, we remain optimistic that volumes will start to recover. Customer destocking is mainly over, which should give us a clear boost. However, consumption in certain categories will likely be negatively impacted by increased geopolitical and macroeconomic uncertainties. We remain focused on the items and areas we can control and will execute plans to realize efficiencies. We are also excited about the strategic investment opportunities that will be decisive for Billerud’s future direction.

Ivar Vatne
President and CEO
Fourth quarter

Sales and results

Net sales for the fourth quarter declined by 20% to SEK 9,566 million (11,971). The organic and currency-neutral net sales declined by 21% due to lower sales volumes in Region North America and negative price and mix changes in both regions. The Group’s total sales volumes were 872 ktons (940), negatively impacted by the weak demand, resulting in curtailments of production in mainly North America, as well as by logistical challenges.
Adjusted EBITDA amounted to SEK 774 million (2,092), corresponding to an adjusted EBITDA margin of 8% (17). The lower result was due to deteriorated prices, lower sales volumes and negative mix changes. Reduced costs for chemicals, logistics and energy as well as delivery from the efficiency enhancement program had a positive impact.  
Items classified as affecting comparability totaled SEK -244 million (-52) and included restructuring costs related to personnel reductions of SEK 80 million and the negative result of revaluation of biological assets in the associated company BSÖ Holding AB Group of SEK 164 million.

Market development and outlook

In the fourth quarter, market conditions remained weak for all products except for liquid packaging board, where conditions were stable on a normalized level. Billerud assesses that the customers’ destocking was largely completed by the end of the period. Prices decreased for sack, kraft and specialty paper, containerboard and cartonboard, and were largely maintained for graphic paper. Prices for market pulp increased.
For the first quarter 2024, market conditions are expected to slightly improve from weak levels. Volumes are expected to increase sequentially. Improved price positions in liquid packaging board are likely to more than offset price pressure in other categories. Higher input costs are expected, mainly driven by energy and logistics.

Events in the quarter

The sale of Billerud’s ownership in the joint venture (JV) Paboco and related intellectual property to the JV partner Alpla was completed on October 9. The transaction resulted in a cash flow effect of SEK 81 million in the fourth quarter.
On October 25, it was announced that additional cost-reduction measures that involve staff reductions will be implemented to improve Billerud’s efficiency, profitability and competitiveness. The number of positions will be reduced by up to 350 throughout the organization. These measures are expected to generate annual structural savings of SEK 300 million with majority of the run-rate savings in 2024. Restructuring costs related to these measures of SEK 80 million were recorded as an item affecting comparability in the fourth quarter.
The Board of Directors appointed Ivar Vatne as President and CEO of Billerud on 1 December. Ivar Vatne had been acting President and CEO since July 2023 and entered the permanent position with immediate effect. Ivar Vatne started as CFO in Billerud in May 2019 and was appointed Deputy CEO in October 2022. He has a professional background from senior positions in Arla, Fiskars and P&G.
On December 20, it was announced that Andrei Krés had been appointed as CFO of Billerud. Andrei Krés had been acting CFO since August 2023 and assumed the permanent role immediately. Andrei Krés joined Billerud in 2011 and has held several positions including Head of Group Treasury and Vice President of Group Finance.  
Billerud Viken AS, the 50/50 joint venture formed by Billerud and Viken Skog AS to explore the possibilities to establish BCTMP production in Follum, Norway, received a positive response on its application for investment support from Enova, the Norwegian state company that works to promote projects that contribute to Norway meeting its climate commitments and transition to a low-emission society. Enova has granted Billerud Viken AS investment support of MNOK 87 for a sub-project with the main goal to be able to fast reduce electric power consumption and move it in time when needed, by means of innovative solutions with great flexibility.
Billerud’s sustainability work was recognized as the company kept its position in the Dow Jones Sustainability Index. Billerud was among the top 10% in the industry according to Standard & Poor’s 2023 Global Corporate Sustainability Assessment.

Events after the quarter

From January 1, 2024, Billerud changed the name of the operating segment “Solutions & Other” to “Other” as a consequence of the divestment of Managed Packaging and other packaging solutions businesses during 2023.


* For key figures and a reconciliation of alternative performance measures including adjusted EBITDA, adjusted operating profit, adjusted EBITDA margin, adjusted operating profit margin, adjusted ROCE and interest-bearing net debt/adjusted EBITDA, see pages 15-17.

For further information:

Andrei Krés, CFO, +46 8 553 335 72
Lena Schattauer, Director Investor Relations, +46 8 553 335 10


This information constituted inside information prior to publication. This is information that Billerud 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 25 January 2024.