Metsä Board's profits excluding non-recurring items plummet in first half year


Metsä Board's results for the first half-year 2012 were positively impacted by the sale of certain businesses and restructuring measures. The company's earnings excluding non-recurring items of €133m declined during the period.

Metsä Board's net result excluding non-recurring items decreased by 77% in the first six months of the year. The company reported a net profit of €8m compared to €35m in the same period last year as well as an operating result of €24m, down from €75m in the first half of 2011. However, profits improved substantially including non-recurring items. Including those items, operating profit amounted to €157m, up from €14m in the first six months of last year, and net earnings, too, increased from -€31m last year to €125m in the first half of this year. The company's turnover declined by around 21% and reached €1.07bn.

Non-recurring items amounted to €133m in the first half year 2012 while standing at -€61m in the same period last year. They were related, amongst others, to divestures the company implemented during the second quarter. In May, Metsä Board sold a 7.3% holding in pulp manufacturer Metsä Fiber to Japanese Itochu Corporation as well as a 0.5 % stake in energy company Pohjolan Voima to Metsä Fibre. Sales gains thanks to these moves were put at €85m and €59m respectively.

Metsä Board's Paper and Pulp division booked an operating loss excluding non-recurring items of €8m in the first half year and thus booked €2m more than in the first six months of 2011. The company explained that business had benefited from the closure and the restructuring of several units resulting in reduced losses. Metsä Board divested its Premium Paper operations at its German Reflex mill, decided to shut down its French Alizay mill and discontinued unprofitable operations of the German Göhrsmühle mill. On the other hand, the company said it had to struggle with falling prices for its products, especially office paper and pulp.

As for the Paperboard division, operating profit excluding non-recurring items declined by 39% year-on-year to €50m in the first half of 2012. One of the main factors weakening the result was said to be the downtime at the company's Äänekoski mill. Production at the site had been halted for rebuild work aimed at raising the mill's folding boxboard capacity. Consequently, overall delivery volumes of paperboard decreased from 753,000 t to 584,000 t during the period.

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