Displaying items by tag: BillerudKorsnäs

CEO Per Lindberg comments on the development during Q4 2015:

“In spite of a strong full-year performance, the isolated result for the fourth quarter is a disappointment. We have had a tough quarter with lost volumes and extra costs, but several of our production units have set new production records, and we have grown in accordance with our targets in business area Consumer board. The overall business situation is satisfactory with stable demand and pricing, and the drop in the Q4 results are due to internal factors only.”

THE RESULT

The operating profit for the quarter was SEK 320 million, burdened with approximately SEK 245 million in unplanned extra costs. The extra costs have occurred during rebuilds and cost overruns in maintenance in our mills. We have run into technical problems that have taken longer than planned to fix and caused major cost overruns and loss of volumes, and on top of that a flooding in Beetham. Total extra cost for rebuilds and rebuild related production volume losses is approximately SEK 150 million, and cost increases for maintenance an additional SEK 95 million. We are not at all happy with our fourth quarter performance and we have to learn from this. Hence, we have decided to postpone the final phase of the build-out of the board machine in Frövi that was planned for 2016. Capacity is already built to run 525 ktonnes in 2018. This will make the investment level in 2016 approximately SEK 1 300 million excluding future restructuring projects in Gruvön and Skärblacka.

MARKET OUTLOOK

The overall market has been stable and we expect this to continue with normal demand patterns and small variations in local pricing.

For business area Packaging Paper the markets remained stable with seasonal variance during the fourth quarter. As anticipated we saw a lower than normal brown sack paper market. Prices in local currency were stable compared to previous quarter with slight deterioration in brown sack paper. We have not run our production at full capacity during the quarter and we have chosen to produce pulp instead of paper in some units.

In spite of the production problems during the quarter and the associated tight delivery situation in Consumer Board the business area has managed to deliver a 6% volume growth year over year.

Business area Containerboard shows a solid strong performance. Fluting demand continued to be strong with improved prices. The liner segment also showed a stable demand and pricing.

STRATEGY

A key part of our strategy is innovation. Since 2013, we have five-folded the number of development projects, we have increased our investments in R&D with 180% and doubled the R&D headcount. We will continue this expansion of innovation capability in 2016. We believe that these efforts and projects will be crucial elements to strengthen our product portfolio even further and thereby contribute substantially to our profitable growth.

Our innovation efforts are not only directed towards better and unique materials but also towards expanding new service and business models. One example is the complete incorporation of the “Managed Packaging” business model from Paccess into Containerboard during 2016. This means that we can fully utilize the business model of managed packaging and grow the solution based side of our business, and as a consequence we rename Containerboard to Corrugated Solutions. Other examples of new business models taking off are the two complete packaging systems from FibreForm Packaging and the three Axello Zap systems sold during last year.

For further information, please contact:

Per Lindberg, President and CEO +46 (0)8 553 335 00
Susanne Lithander, CFO, +46 (0)8 553 335 00

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world-leading provider of primary fibre based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

Production problems at the end of the fourth quarter continued to have a negative impact on BillerudKorsnäs’ results. The total cost of production disruptions during the quarter is estimated to approximately SEK 245 million. Operating profit for the fourth quarter 2015 is estimated to approximately SEK 320 million.

In early December 2015 the company announced increased costs with about SEK 165 million due to production problems, mainly in Frövi. During December, additionally approximately SEK 80 million in costs have been incurred for production disruptions and increased repair and maintenance costs. Disturbances continued at KM5 in Frövi, and increased maintenance costs have hit Skärblacka and Karlsborg but also Beetham in connection with extensive flooding. Approximately SEK 25 million affects business area Consumer Board and the remaining approximately SEK 55 million affects business area Packaging Paper.

"The board machine in Frövi has improved step by step but did not stabilize on the level we had hoped for in December. Major rebuilds have been made in Frövi to increase capacity, and it is not uncommon that the time to for the run-in takes longer than anticipated. It may be too early to claim that the problems are solved, but we can during the last few weeks see that the machine is coming back on plan. Skärblacka and Karlsborg have produced according to plan during the fourth quarter, but incurred more maintenance costs than planned at the end of the year. The problems in the quarter are thus self-generated. The exception is Beetham that was under water at the great floods in England in December but have started up in January and produce according to plan again. We see no negative change in demand or the overall cost position and several of our production units have set new production records in 2015, "says Per Lindberg, President and CEO.

The results are still preliminary and have not been reviewed by the auditor.

BillerudKorsnäs will publish its year-end report for 2015 at 07:00 CET on 10 February 2016. 

For further information, please contact:

Susanne Lithander, CFO, +46 (0)8 553 335 00
Per Lindberg, President and CEO, +46 (0)8 553 335 00

The information is such that BillerudKorsnäs Aktiebolag (publ) is obligated to publish under the Swedish Securities Market Act. Submitted for publication at 08.00 CET on 22 January 2016.

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world-leading provider of primary fibre based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

BillerudKorsnäs has strengthened its competence in formable packaging through a smaller investment in a 10 percent stake in the Danish packaging innovation company EcoXpac. The investment forms the foundation for collaboration and is part of BillerudKorsnäs commitment to innovation to solve the packaging challenges of the future.

BillerudKorsnäs has in addition to a solid foundation in innovation, including the continuous development of our existing materials and solutions, also an ambition to take on a number of larger, more fundamental and long-term challenges in the packaging sector. This is done in order to find solutions and develop entirely new packaging concepts that can challenge plastic, glass and aluminium. One such concept is to produce a bottle completely made of paper. Through collaboration and by combining the knowledge and experience of BillerudKorsnäs and EcoXpac the aim is to achieve this.

"Innovation is a key factor in further strengthening our business in the long term but also a way for us to challenge conventional packaging for a sustainable future. Therefore it is natural for us to aim high in a number of well-chosen development projects and take on real challenges that can have a big and long term positive impact on our business and our contribution to a more sustainable world. Although the investment in EcoXpac is small in financial terms compared to the size of BillerudKorsnäs, it creates conditions for success for the innovation challenges we now take on." - says Magnus Wikström SVP Technology & Strategic Development at BillerudKorsnäs.

EcoXpac is a company specialising in advanced 3D-forming of fibre based structures. It was founded in 2005 and is based in Denmark.

"Our knowledge and experience in the area of moulded pulp and our entrepreneurial approach combined with the ability of BillerudKorsnäs to bring ideas and innovations to the market forms a strong base for our future cooperation. A base from which we aim to realize projects such as that to create a paper bottle"- says Jesper Servé the founder of EcoXpac.

For more information, please contact:

Henrik Essén, Senior Vice President Communication and Sustainability, +46 (0)8 553 335 00, This email address is being protected from spambots. You need JavaScript enabled to view it.

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world leading provider of primary fiber based packaging materials and have customers in over 100 countries. The company has 8 production units in Sweden, Finland and the UK and about 4300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

EcoXpac is an innovative company specialized in designing, developing and implementing process solutions for moulded fibre. Since its establishment in 2005, the company follows a strategy striving to introduce fiber-based products into previously non utilized categories. EcoXpac already cooperates with a network of national research organizations, such as the Technical University of Denmark & Danish Technological Institute, to ensure innovation stems from a thoroughly analyzed basis.  Learn more about EcoXpac: www.ecoxpac.dk or follow us on Twitter @EcoXpac.

This winner of this year’s Pack Challenge has been chosen. The aim of this year’s challenge was to come up with a packaging concept to get more people to support UNICEF. The winning solution lets people give a superpower to someone they like and help change the world for the better. Pack Challenge is arranged annually by BillerudKorsnäs and Berghs School of Communication.

Students this year faced a real challenge: finding the best possible way of packaging a feeling that would get more people to support UNICEF’s work. The concept needed to communicate the benefits of giving, and show how that money is used, while also encouraging more people to make donations.

The competition is an integral part of the full-time Graphic Design and Production Management courses at Berghs. BillerudKorsnäs contributes lectures and study visits through which students are able to learn more about its culture of innovation. This involves constantly challenging today's approach to packaging and developing new, sustainable materials and solutions. The aim is to spark interest in packaging solutions among tomorrow’s designers, communicators and decision makers.The winning entry features five different lapel pins, each symbolising a specific superpower. The superpowers roughly translate to: Uniting Peace Particles, Love-glimmering Kiss Catapult, Infection-annihilating Super Defence, Knowledge-lifting Wisdom Power, and Supernatural Mega-boost. Each pin is encased in an envelope where the superpower is linked to the UN’s Convention on the Rights of the Child. When someone receives a pin, they activate their powers by choosing a lifesaving product for use in the field on UNICEF’s website.

The winning entry builds upon the idea that even small contributions can make a big difference.  Adding a whole new dimension – making lapel pins that could become collectables – helps create a solution that is as simple as it is genius.

Winning team: Evelina Wirne, Gustaf Jonshult, Sofia Ekelund and Sara Edström

Andreas Eriksson, Head of Communication at UNICEF Sweden, says, “We see major potential in the competing entries and are very impressed by the high standard of the students’ work and their commitment to UNICEF. Our operation is completely dependent on voluntary contributions, so it's important for us to find new, innovative ways to increase our fundraising.”

Read more about Pack Challenge15 at: www.packchallenge.se

For more information, please contact:

Pål Pettersson, Program Manager, Communication Design/Graphic Design, Berghs School of Communication, 070-254 02 39, This email address is being protected from spambots. You need JavaScript enabled to view it.

Jimmy Nyström, Business Development Director, BillerudKorsnäs, 070-383 24 42, This email address is being protected from spambots. You need JavaScript enabled to view it.

Ingeborg Ekblom, PR Manager, UNICEF Sweden, 070-995 59 16 This email address is being protected from spambots. You need JavaScript enabled to view it.

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world-leading provider of primary fibre based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

BillerudKorsnäs has been identified as a global leader for its actions and strategies in response to climate change and has been awarded a position on the Climate “A” List presented by CDP today.

BillerudKorsnäs is among 5% of the corporations participating in CDP’s climate change program to be awarded a position on the Climate “A” List. The purpose of the list is to recognize companies’ actions to mitigate climate change in the past reporting year. The list is requested by 822 investors representing more than a third of the world’s invested capital.

“2015 is an important year for our climate with the Paris conference COP21 as a milestone. In combating climate change all parts of society have to participate and we are extremely pleased that the dedicated efforts of BillerudKorsnäs now have been recognized by CDP. We have for many years been working hard on energy efficiency and on reducing our own greenhouse gas emissions. In addition to that we also see that our renewable packaging materials and solutions contribute by replacing fossil materials,” comments Henrik Essén, Senior Vice President Communication and Sustainability at BillerudKorsnäs.

BillerudKorsnäs is also recognized for transparency and awarded a position on the Nordic Climate Disclosure Leadership Index (CDLI). The reported data has been independently assessed against CDP’s scoring methodology and marked out of 100. Organizations graded within the top 10% in the region constitute the CDLI. BillerudKorsnäs has scored 99.

CDP, formerly Carbon Disclosure Project, is an international, non-profit organization providing a global system to measure, disclose, manage and share vital environmental information. CDP works with market forces, including 822 institutional investors with assets of EUR 86 trillion, to motivate companies to disclose their impacts on the environment and natural resources and take action to reduce them. More than 5,500 companies disclosed environmental information through CDP in 2015.

Read CDP’s annual global climate change report here.

For more information, please contact:

Henrik Essén, Senior Vice President Communication and Sustainability, +46 (0)73-057 38 01, This email address is being protected from spambots. You need JavaScript enabled to view it.

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world-leading provider of primary fibre based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

CEO Per Lindberg comments on the development during Q3 2015:

“The third quarter performance and overall market situation strengthen our belief in our long-term strategic direction. The growth strategies per Business Area were confirmed, and our belief, that the contemplated investments in our own production structure will allow us to capture market opportunities, is strengthened.”

THE RESULT

I am pleased with the adjusted operating profit for the quarter of SEK 683 million. Of course the continued weak SEK continues to be a positive profit driver, but at the same time we see 5% year on year volume growth in Consumer Board in line with our targets, record margins in Containerboard, and a balanced development for Packaging Paper with some weaker and some stronger areas. Simultaneously, our ROCE is above target at 14% adjusted and our balance sheet strengthens further to a net debt/equity ratio of 0.46.

MARKET OUTLOOK

The overall market is stable, thus continuing sideways with only minor variations in segment demand and pricing. Looking ahead, we expect this pattern to continue with normal demand patterns and small variations in local pricing.

Within Packaging Paper the MG markets are continued strong, whereas MF and white sack paper markets are weaker but stable. Unfortunately, the market has not been strong enough to absorb the announced price increases for kraft and sack paper earlier in the year. Our production capacity in some segments has not been fully utilized due to increased competition, selective pressure on local prices, and in the non-integrated mills also due to unsatisfactory profitability. As a consequence, we have in October taken the decision to close our production in Tervasaari completely, after having run it underutilized during the year with insufficient profitability. This has been a tough decision to make. The local team in Tervasaari has made significant efforts to improve profitability and utilization, but the cost position of the machine in combination with an increasingly commoditized product portfolio proved too big of a burden to carry.

Consumer Board market continues to be strong and we are experiencing delivery pressures from our main markets. I am happy we have decided to invest in increased capacity in Consumer Board for continued volume growth.

Business area Containerboard noted an all-time high operating margin. Fluting demand continue to be strong. The new flute from the upgraded PM6 in Gruvön lives up to the high quality expectations and is a solid product for continued value growth. The liner segment shows a stable demand and attempts for price increases has been made on the market even with more capacity coming on line upstream.

STRATEGY

Growing demand driven by global megatrends favours our markets and to support the volume growth strategy within business area Consumer Board we have started a pre-project investigating the opportunity to invest in a new board machine to be placed in Gruvön. In addition to increased cost efficient capacity it would also include a streamlining of the production structure within business area Packaging Paper as the current production of kraft papers at the Gruvön production unit would be discontinued and replaced by production at other BillerudKorsnäs units. This supports business area Packaging paper’s selective growth strategy and in a second pre-project we focus our efforts on further structural changes to enable growth in the attractive growing kraft paper segments within medical papers, food packaging and release liners and the discontinuation in the less attractive commodity segments. The investigation explores the possibility of moving the paper machine in Tervasaari to Skärblacka and make it an integrated unit, as well as investment in further value adding surface treatment capacity at existing MG paper production in Skärblacka.

Should both pre-projects materialise it would imply an overall efficient production structure for the group, capacity increases in very attractive areas and improved margins due to better product mix including removal of any exposure to the pulp market. 

For further information, please contact:

Per Lindberg, President and CEO +46 (0)8 553 335 00
Susanne Lithander, CFO, +46 (0)8 553 335 00

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world leading provider of primary fiber based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

BillerudKorsnäs has decided on streamlining their production structure through a closure of the paper machine in Tervasaari, Finland, latest during Q3 2016. BillerudKorsnäs will thereby entirely leave the Tervasaari production site. The decision has been made after union negotiations and is based on unsatisfactory profitability levels.

Within BillerudKorsnäs Business Area Packaging Paper, a wide range of kraft papers and packaging solutions are offered for use in food packaging, medical packaging and packaging of construction materials - to mention a few application areas. Under the business area strategy “Selective Growth”, BillerudKorsnäs is taking steps to grow within attractive segments of the packaging paper area and to streamline its production structure.

The BillerudKorsnäs production at Tervasaari consists of one paper machine with a capacity of 100 000 t/a of machine glazed papers, MG papers. The paper machine is unintegrated to pulp production which results in an unfavorable cost position, despite the fact that the machine is among the largest of its kind.

The decision means that the production at the machine will stop latest during Q3 2016.

In August this year, BillerudKorsnäs started a feasibility study investigating among other things the potential of moving the Tervasaari machine to Skärblacka in Sweden. Skärblacka would offer integration to pulp production and, with the Tervasaari machine, Skärblacka would strengthen its position as one of the world's most efficient production units for white MG papers. The investigation is on-going and will be finalized during the first half of 2016.

“The closure of production at Tervasaari is a first step in streamlining our production structure. There is right now intensive work being done in the form of feasibility studies that will lead us in our further development of our production structure. The machine in Tervasaari is one of the largest of its kind and our staff has done a great job to improve profitability through creative ideas and committed efforts but unfortunately this has not been enough due to external factors”, says Christer Simrén, COO and Executive Vice President, BillerudKorsnäs.

The closure will lead to restructuring costs of approximately SEK 100 million. These costs will be included in the reporting for Q3 2015 under “Other units”.

For more information, please contact:

Henrik Essén, SVP Communication and Sustainability, +46 (0)8 553 335 00

The information is such that BillerudKorsnäs Aktiebolag (publ) is obligated to publish under the Swedish Securities Market Act. Submitted for publication at 11.00 CET, October 15th 2015.

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world leading provider of primary fiber based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

BillerudKorsnäs and UNICEF have set students at Berghs School of Communication an exciting creative challenge – to package an emotion that inspires more people to support UNICEF in its charity work around the world.

BillerudKorsnäs and Berghs School of Communication have been working together since 2010 with the purpose of encouraging students’ creativity and generating interest in packaging solutions among the designers, communicators and decision makers of tomorrow. The collaboration started out as an annual contest and has now developed into an integral part of the full-time Graphic Design and Account Management programmes at Berghs.

This year’s edition of the contest, PACKCHALLENGE:15, will take place during September and October. Students at Berghs are now facing an exciting creative challenge – how can you best package an emotion that inspires more people to help UNICEF in its charity work around the world?

UNICEF’s mission is to reinforce children’s rights. Its work is financed entirely through voluntary contributions from private individuals and companies. One way of raising funds is to sell what are known as field products, such as vaccines, water purification tablets, school materials and mosquito nets.

The products are sold online and through shops in connection with specific campaigns. In recognition for their contribution, donors receive a gift card that they can then choose to give away as a Christmas or birthday present. The students’ assignment is to come up with a packaging solution that communicates the benefits of giving, how the money is used and encourages support of UNICEF.

The solution will:

-           Be simple to understand and easy to buy.

-           Give the sense that it contains something tangible.

-           Be suitable for different types of shops.

-           Feel good to buy and valuable to receive.

-           Be relevant throughout the year.

-           Be fibre-based to some extent.

-           Be cost-effective to produce and distribute.

Innovation and the use of new technology will be rewarded, provided that it adds value and is relevant.

The students are required to present their solutions on 29 October.

“Berghs School of Communication is one of the best communication schools in the world. This partnership is very important as it provides us with a valuable injection of new ideas while giving students insight into the packaging challenges of tomorrow. Supporting UNICEF’s work feels worthwhile and extremely relevant,” says Jimmy Nyström, Business Development Director, BillerudKorsnäs.

“UNICEF has a long history of working in innovative ways where we use new technologies and materials to increase the effectiveness of our field work and reach out to vulnerable children the world over. Our organisation is completely dependent on voluntary contributions, which is why it is equally important for us to find innovative ways to increase donations. PACKCHALLENGE is a fantastic initiative and we’re really looking forward to the results of the students’ work,” says Andreas Eriksson, Director of Communication, UNICEF Sweden.

Berghs School of Communication was named Cannes Future Lions School of the Year in 2009, 2010, 2014 and 2015.

Read more about PACKCHALLENGE:15 at www.packchallenge.se

For further information, please contact:

Ingeborg Ekblom, Director of PR, UNICEF Sweden, +46 (0)70 995 59 16, This email address is being protected from spambots. You need JavaScript enabled to view it.

Pål Pettersson, Programme Director Communication Design/Graphic Design, Berghs School of Communication, +46 (0)70 254 02 39, This email address is being protected from spambots. You need JavaScript enabled to view it.

Thea Tyvi, Course Director, Berghs School of Communication, +46 (0)70 529 66 32, This email address is being protected from spambots. You need JavaScript enabled to view it.

Jimmy Nyström, Business Development Director, BillerudKorsnäs, +46 (0)70 383 24 42 This email address is being protected from spambots. You need JavaScript enabled to view it.

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world leading provider of primary fiber based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

The demand for sustainable packaging solutions is growing globally. BillerudKorsnäs wants to explore the opportunities to respond to the demand growth while at the same time streamline and further improve its production structure. The company is now launching two feasibility studies, one regarding investment into a new board machine at the production site in Gruvön, Sweden, and the other regarding a streamlining and development of the production structure for packaging papers.

BillerudKorsnäs is a leading supplier of renewable fiber based packaging materials and solutions. Within liquid packaging board and other virgin fiber cartonboard, the company is one of the world leaders. Driven by global megatrends, the demand for these types of board is increasing. BillerudKorsnäs therefore wants to investigate the possibility of installing a new board machine at the production unit in Gruvön. The investigation is a part of BillerudKorsnäs strategy for volume growth within business area Consumer Board. It is also in line with the strategies for the business areas Containerboard and Packaging Paper. The machine would become one of the most cost efficient in the world with a capacity of approximately 500 000 t/a of liquid packaging board, cartonboard, food service board and white kraftliner. In addition to growth in attractive board segments, an investment decision would also include a streamlining of the production structure within the business area Packaging Paper as the current production of kraft papers at the Gruvön production unit would be discontinued and replaced by production at other BillerudKorsnäs units. A potential investment decision can be made at the earliest during 2016.

Simultaneously, BillerudKorsnäs is launching an investigation into the possibilities of further structural change and growth in selected attractive kraft paper segments. The investigation includes exploring the possibility of moving the MG paper machine in Finnish Tervasaari, unintegrated to pulp production, to Swedish Skärblacka, which is an integrated unit. The investigation also includes investment in further value adding surface treatment capacity at existing MG paper production in Skärblacka. If implemented, the investments would strengthen Skärblacka’s position as one of the world's most efficient production units for white MG papers while also opening up opportunities in attractive market segments within medical papers, food packaging and release liners. The investigation will be completed during the first half of 2016 and after a potential decision is taken about a year is required to carry out the investment in surface treatment capacity and one and a half years for a potential paper machine move.

“These two investigations clearly indicate that we have our sights set on growth. We carefully compare all different growth scenarios to each other. Right now, we consider conditions for organic, investment driven, growth in our own production structure as the most favorable. These investigations do not exclude the possibility of further acquisitions”, says Per Lindberg, President and CEO, BillerudKorsnäs.

The investigations are independent of each other. Also independent of the outcome of the investigations, BillerudKorsnäs invites to union negotiations regarding a possible closure of the BillerudKorsnäs production at Tervasaari.

For more information, please contact:

Per Lindberg, President and CEO, +46 (0)8 553 335 00

Henrik Essén, SVP Communication and Sustainability, +46 (0)8 553 335 00

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world leading provider of primary fiber based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com

CEO Per Lindberg comments on the development during Q2 2015:

“We deliver a result for the quarter that is strong, but burdened with extra costs for the upgrade of our fluting machine in Gruvön. Technically, the upgrade is a success and the quality improvements are above expectations, but it took a bit longer to implement than estimated.”

THE RESULT

The second quarter’s operating margin of 10% was negatively impacted by the planned maintenance shutdown and the extra costs for implementation of the upgrade of the fluting machine in Gruvön, all in all approximately SEK 170 million. I am however content with the underlying result we produce. Overall the weak SEK continues to be positive for us. Our growth 2015 is largely driven by favourable currency developments, and our volumes have suffered partly due to investments and rebuilds. We have given priority to longer-term capacity enhancements rather than short term volume maximizations.  Still our volume growth in business area Consumer Board for the first half of the year was 6% and above the plan.
Our net debt/equity ratio increased to 0.62 due to our dividend pay-out. Return on capital employed improved to 12% and we continue to close in on our targeted 13%, so overall we are performing well in line with our targets.

MARKET OUTLOOK

The overall market has been stable during the quarter. We expect the market to continue to be stable with good demand and little changes in local prices.

We see no reason to change our outlook for business area Packaging Paper. Increased competition pressures local prices within the MF segment and we did not utilise our full capacity during the quarter. This situation was anticipated and is likely to continue. Meanwhile the market situation for sack paper and the MG segments are solid which makes the outlook for the business area quite stable and balanced.

Consumer Board market continues to be stable.

Within Containerboard, the fluting segment is currently very strong, with strong order books and with previously announced local price increases starting to show. We are also expecting the improved product quality from the machine upgrade to support additional value growth in the business area in the longer-term. In the liner segment, competition continues to increase with increased capacity on the market. But local prices have been kept stable during the quarter, helped by low stocks, announced price increases for waste based papers, and a strong USD that favours European kraftliner.

STRATEGY

One of our strategic stepping stones is to expand our position both in the value chain as well as geographically. We want to expand our offering and our networks to include stakeholders beyond converters, for instance brand owners.

In our efforts to achieve our ambitions in this area it is worth mentioning that our JV, FibreForm Packaging, has taken its first order where a complete system solution has been sold containing a FreeFormPack machine with deliveries of FibreForm material to one of Europe’s largest co-packer, Vetipack.

When it comes to geographical expansion our goal is that more than 50% of our future growth will come from outside of Europe. Here we have finalised establishment of companies in India and USA and they are fully operational. We are also finalising the set-up of a company and a complete customer service center in Singapore.

The information is such that BillerudKorsnäs AB (publ) is obligated to publish under the Swedish Securities Market Act. Submitted for publication at 10.02 CET, 20 July 2015.

For further information, please contact:
Per Lindberg, President and CEO 46 (0)8 553 335 00
Susanne Lithander, CFO, 46 (0)8 553 335 00

BillerudKorsnäs provides packaging materials and solutions that challenge conventional packaging for a sustainable future. We are a world leading provider of primary fiber based packaging materials and have customers in over 100 countries. The company has 8 production sites in Sweden, Finland and the UK and about 4 300 employees in over 13 countries. BillerudKorsnäs has an annual turnover of about SEK 21 billion and is listed on Nasdaq Stockholm. www.billerudkorsnas.com