Interim report 1 January - 30 June 2001
01:2 01:1 0106 0006
Earnings per share, SEK¹ 6.04 5.68 9.77
Cash flow from current operations 14.54 6.15 20.69 10.09
per share, SEK¹
Net sales, SEK M 21,556 18,522 40,078 32,343
Earnings after financial items, SEK 2,017 1,963 3,980 3,443
Net earnings after tax, SEK M 1,407 1,323 2,730 2,279
1 Adjusted historically to reflect new issue of 1.8
million shares in 2001.
Earnings per share improved by 20%.
Cash flow from operations more than doubled.
Higher operating profit in all business areas: Hygiene Products 56%,
Packaging 28% and Forest Products 15%.
Earnings per share were 6% higher in the second quarter than in first.
· Integration of acquired operations in North America proceeding
according to plan. Effect on earnings per share in the second quarter
amounted to SEK 0.40.
NET SALES AND EARNINGS
Earnings per share increased 20% and amounted to SEK 11.72 (9.77). Net
earnings after tax amounted to SEK 2,730 M (2,279).
Consolidated net sales amounted to SEK 40,078 M (32,343), an increase of
24% compared with the year-earlier period. Of this increase, 13% was
attributable to growth, mainly due to company acquisitions, while higher
sales prices and an improved product mix accounted for 3%. Currency
movements increased consolidated net sales by 8%.
Group operating profit amounted to SEK 4,650 M (4,044), an increase of
15% compared with the year-earlier period. Excluding the Group's share
in earnings of Modo Paper, which amounted to SEK 524 M in the first six
months of 2000, the increase was 32%. All business areas reported higher
earnings. The operating profit for Hygiene Products amounted to SEK
2,033 M (1,304), an increase of 56%. Packaging reported operating profit
of SEK 1,709 M (1,336), an increase of 28%, and operating profit in
Forest Products amounted to SEK 1,490 M (1,293), an increase of 15%. The
North American acquisitions accounted for 17 and 7 percentage points,
respectively, of the increases for Hygiene Products and Packaging.
Financial items amounted to an expense of SEK 670 M (expense: 601). A
lower average level of net debt did not fully compensate the effects of
higher interest rates and the weakening of the Swedish krona.
Group earnings after financial items amounted to SEK 3,980 M (3,443), an
improvement of 16% compared with the year-earlier period. Currency
movements increased earnings after financial items by 11%.
Excluding non-recurring items, return on shareholders' equity was 14%
(14) and return on capital employed was 15% (13).
Net sales and operating profit from the North American operations
acquired at the beginning of 2001 were included in the second quarter
results as of the acquisition date, which was March 2 for tissue
operations and March 9 for the packaging company. Net sales for these
operations accounted for slightly more than 7% of consolidated net
sales. The effect on earnings per share was SEK 0.40. Integration is
progressing according to plan, and the development meets established
Comparison with the first quarter of 2001
Consolidated earnings per share improved by 6% to SEK 6.04. Hygiene
Products improved operating profit by 37%. Excluding acquired North
American operations, profit increased by 12%. Packaging reached a profit
on the same level as in the first quarter. Excluding acquired packaging
operations in North America, profit decreased by 12%. Due to lower pulp
prices, Forest Products reported a 4% decline in operating profit.
Publication paper operations, however, increased operating profit by 22%
and thus reported the best quarterly operating profit ever. The Group's
financial costs increased as a result of the North American
acquisitions. Currency movements affected earnings in the second quarter
positively by 4%.
The operating cash surplus amounted to SEK 7,431 M (5,737), equal to 19%
(18) of net sales. The change in working capital amounted to an inflow
of SEK 6 M (outflow 1.516) during the period. This improvement was
primarily attributable to Hygiene Products. Current capital expenditures
totaled SEK 1,447 M (946), which together with other items resulted in
operating cash flow of SEK 5,967 M (3,217).
Cash flow from current operations, defined as cash flow before strategic
investments and dividends, amounted to SEK 4,824 M (2,357), equal to SEK
20.69 (10.09) per share.
Company acquisitions during the period amounted to SEK 11,591 M and
consisted primarily of the North American acquisitions. Strategic
capital investments in plant and machinery, divestments as well as
restructuring costs, totaled SEK 841 M.
Comparisons with the first quarter of 2001
The operating cash surplus amounted to SEK 3,995 M (3,436) and working
capital decreased. Despite higher current capital expenditures,
operating cash flow from operations thus amounted to SEK 3,872 M, which
was SEK 1,777 M higher than during the preceding quarter. 06
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