Holmen Year-end report for 2010

February 2, 2011 by timbercommunity

Operating profit amounted to SEK 1 596 million (1 620). The result includes SEK 264 million in items affecting comparability from a revaluation of forest (SEK +1 050 million), as well as an impairment loss and provisions within Holmen Paper (SEK -786 million). Demand for newsprint in Europe in the fourth quarter was slightly higher than in 2009. Over the full year 2010 deliveries increased by 2 per cent. During the year, imports from North America fell and European exports to Asia rose; as a result, capacity utilisation at European producers was high towards year-end. Prices in Europe were significantly lower than in the preceding year. Price negotiations for 2011 are in progress and are expected to lead to substantial increases.

• Profit after tax for 2010 was SEK 704 million (2009: SEK 1 006 million). Earnings per share amounted to SEK 8.4 (12.0). The return on equity was 4.2 per cent (6.4).
  

• The Board of Directors proposes a dividend of SEK 7 (7) per share.
  

• Operating profit, excluding items affecting comparability, totalled SEK 1 332 million (1 620). Holmen Paper’s profit declined considerably as a result of lower newsprint prices and higher fibre costs. Profitability in other parts of the Group improved. Compared to the third quarter, operating profit excluding items affecting comparability decreased by SEK 22 million to SEK 361 million.
  

• Demand for newsprint in the quarter was somewhat higher than in 2009. Current price negotiations are expected to lead to substantial price increases during 2011. The virgin fibre board market was robust and demand in Europe was 8 per cent higher than last year. Price increases were implemented during the year.
  

• Decision has been made to close the smaller paper machine in Madrid.