The year 2012 was a fantastic and exciting time for SCA. Some of the largest business transactions in SCA’s history transformed us into a hygiene and forest products company. We continued to pursue our work on the strategic priorities of efficiency, innovation and growth. Despite a turbulent global economy, we increased our sales and profits in 2012.
Turbulent global economy
The global economy remains in a precarioussituation. However, SCA’s strong exposure to hygiene products, which are less cyclical, speaks to its advantage. Such macrofactors asa growing middle class, population increases and an aging population indicate greater future demand for our products and services. Our hygiene operations performed well in 2012, while the forest products operations were negatively affected by the economic downturn and stronger Swedish krona.
A company in transformation
During 2012, SCA carried out two historically important business transactions: the purchase of Georgia-Pacific’s European tissue operations and the sale of our packaging operations.
We invested a great deal of time and energy in the acquisition of Georgia-Pacific. In July, our new colleagues were given a warm reception in the form of general meetings, individual letters and a personal welcome from members of management. The acquisition will strengthen our competitiveness in the European tissue market and is a good complement to our market positions. The integration process will be assigned high priority in 2013. The acquisition will generate annual cost synergies of EUR 125m with full effect from 2016.
The sale of SCA’s packaging operations was another step on our journey of change and will lower our sensitivity to business cycles and provide financial growth opportunities in our hygiene operations. We retained two kraftliner mills in Sweden since they form an integral part of our Forest Products business area.
At the end of 2012, the 50% holding in thenewsprint mill in Aylesford, UK, was sold and we signed an agreement for the sale of the publication paper mill Laakirchen, Austria. Accordingly, our Forest Products business area is now concentrated to our Swedish operations, which are well-integrated with our forestry operations.
Read more in the annual report for 2012.
//Jan Johansson, President and CEO