Ence's net profit for the first half 2012 down 42% y-o-y

For Spanish pulp manufacturer Ence Energía y Celulosa the first half year 2012 was considerably weaker than the first half 2011.

Ence's net profit for the period decreased by 42% to €16m even though pulp production in tons and pulp sales in tons increased. Weakening pulp prices are said to be one reason for the decline. The company’s total sales in the first half of 2012 reached €280.7m, down 8% year-on-year.

Ence says the average net sales price for eucalyptus pulp amounted to €467/t in the first half of the year, 11% below the average price in the first half of 2011. Pulp sales increased by 3% with 18,628 more tons sold than in the first half 2011. Pulp production increased marginally by 1% to 598,248 t. The company reports a capacity utilisation of 96% despite difficulties in restarting the Huelva mill after a maintenance shutdown in May that caused a standstill of 26 days and a production shortfall of roughly 27,000 t.

Ence was able to raise its electricity output by 4% to 768,477 MWh and its sales by 13% to €96.7m year-on-year. According to the company, this was possible thanks to higher electricity prices and strength in production.

Furthermore, Ence reports that the breakdown of sales by countries and segments remained in line with 2011, with the tissue market as the most relevant target paper segment. The company sees the market’s steady growth of 1% per year in Europe, even in areas of reduced economic activity as an advantage.

The amount of pulp shipped outside of Europe decreased to 10% primarily due to a decline in exports to China, Ence reports. Sales in Spain remained steady at 14%. Germany is Ence’s largest European trading partner; 23% of the company's output is sold there, followed by Italy with 16% and France with 10%.

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