Interim Report Q2 2011

1 JANUARY–30 JUNE 2011 (compared with same period a year ago)

• Net sales decreased by 2% (increased by 5% excluding exchange rate effects and divestments) to SEK 52,064m (53,266)
• Operating profit excluding restructuring costs decreased by 5% (increased by 1% excluding exchange rate effects) to SEK 4,262m (4,467)    
• Restructuring costs amounted to SEK 0m (451)
• Earnings per share rose 8% (13% excluding exchange rate effects) to SEK 3.85 (3.57)
• Cash flow from current operations was SEK 1,840m (2,816)

(Table included in attached pdf)

CEO'S COMMENTS
The recovery of the world economy continues, but at a slower pace. Emerging markets are showing continued strong growth, while in Europe, major regional differences exist. The rapid growth in the emerging markets has driven up raw material prices sharply. Indications are strong that prices are now stabilising at a very high level.

During the year we have raised our own prices, continued to carry out cost-cutting measures and stepped up the pace of new product launches.

Net sales for the second quarter of 2011 rose 5% and operating profit rose 2% compared with the first quarter of 2011. The earnings improvement is attributable to higher volumes and prices.

Net sales for the first half of 2011 increased by 5%, excluding exchange rate effects and divestments, as a result of higher prices and volumes compared with the same period a year ago.

Compared with the first half of 2010, raw material costs have risen by more than SEK 2bn. We have succeeded in compensating for this through own price increases and cost cutting. The strengthening of the Swedish krona has entailed a decrease in operating profit by SEK 600m. All business areas have been affected. During the first half of 2011, profit was not affected by restructuring costs.

Earnings per share rose 8%, or 13% excluding exchange rate effects.

Operating profit for the first half of 2011 rose 1%, excluding exchange rate effects and restructuring costs, compared with the same period a year ago. Higher prices and volumes along with cost savings compensated for sharply higher costs for raw materials, energy and distribution. Earnings for Personal Care were favourably affected by higher volumes and cost savings, while SEK 420m in higher raw material costs led to a lower profit. Higher prices and a changed product mix along with higher volumes had a favourable effect on earnings for Tissue. However, SEK 400m in higher raw material costs and higher energy and distribution costs led to a lower profit.

The sharp earnings improvement for Packaging is attributable to higher prices and volumes along with cost savings, which compensated for slightly more than SEK 1bn in higher raw material costs. Profit for Forest Products decreased as a result of higher raw material and energy costs, as well as the fact that the strengthening of the Swedish krona was not fully compensated by higher prices and productivity improvements.

Continued favourable demand is expected in all of SCA's business areas.

For further information, please contact:
Camilla Weiner, Head of Corporate Communications, +46 8 788 52 34
Johan Karlsson, Vice President Investor Relations, +46 8 788 51 30
Pär Altan, Vice President Media Relations, +46 8 788 52 37

Note
SCA discloses the information provided herein pursuant to the Securities Markets Act. This report has been prepared in both Swedish and English versions. In case of variations in the content between the two versions, the Swedish version shall govern.