Demand for cartonboard has been strong during the year for Reno de Medici. But the price hikes implemented lag behind the significant cost increases so the first half has not been as profitable for the company.
For Italian board producer Reno de Medici (RDM), the first half of the year was marked, amongst others, by the divestment of the La Rochette mill in France in April, which concurrently meant the departure of the company from the market for fresh-fibre board.
In the recycled board segment, the company benefited from booming demand in the reporting period but the costs for recovered paper, energy as well as logistics were so high that margins worsened year-on-year, RDM writes. The company implemented price hikes for its products due to the inflationary cost burden but the increases will have full effect on financial results only in the coming months.
Against this backdrop, Reno de Medici was able to increase sales by 7 per cent to €311.6m in the first half of the year compared with the first six months of 2020. However, operating and net profit plummeted by 91 per cent and 86 per cent to €2.6m and €3.4m, respectively.
In RDM's financial report for the first half, the results of the divested subsidiary La Rochette were reclassified to "Discontinued operations" so that results only reflect the recycled board segment. RDM's results for the first half of 2020 were restated to make them comparable with those of the first half of 2021.
RDM reports it has delivered above-average volumes of recycled board in the first half of the current year.
This article is an excerpt from our article on Reno de Medici's half-year results. Read the full article in EUWID Pulp and Paper no 33, which will be published on 18 August.
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