Arctic Paper S.a. · GPW:ATC
Arctic Paper — Q4 2023 Earnings Presentation
31 slides from Arctic Paper's earnings presentation, 2024
Slide 1: Preliminary financial results Q4 2023
Preliminary financial results Q4 2023
Slide 2: Disclaimer
DISCLAIMER Please read the information below carefully This presentation (the ‘Presentation’) the regulated market, in particular the appearance of unexpected facts or is no certainty that the estimates, was prepared by Arctic Paper SA (the regulated market operated by the W arsaw circumstances whic
Slide 3: Agenda
Agenda 1 Paper 4 Energy 2 Pulp 5 Financial performance 3 Packaging 6 Focus 3 Q4 2023 www.arcticpaper.com
Slide 4: Summary Preliminary Q4 2023
SUMMARY PRELIMINARY Q4 2023 Arctic Paper Group Q4 2023 vs. Q4 2022 Net sales EBITDA Operating CF ROCE* (PLN mn) (PLN mn) (PLN mn) 825.9 1 085.1 96.3 140.0 128.1 126.0 17.3% 34.4% (Q4 2023) (Q4 2022) (Q4 2023) (Q4 2022) (Q4 2023) (Q4 2022) (Q4 2023) (Q4 2022) Paper/Pulp EBITDA Net debt/EBITDA* Paper
Slide 5: Summary Preliminary YTD Dec 2023
SUMMARY PRELIMINARY YTD DEC 2023 Arctic Paper Group YTD DEC 2023 vs. YTD DEC 2022 Net sales EBITDA Operating CF ROCE* (PLN mn) (PLN mn) (PLN mn) 3 549.2 4 894.3 475.3 974.0 473.3 607.4 17.3% 34.4% (YTD DEC (YTD DEC (YTD DEC (YTD DEC (YTD DEC (YTD DEC (YTD DEC (YTD DEC 2023) 2022) 2023) 2022) 2023) 2
Slide 6: Paper
PAPER 6 Q4 2023 www.arcticpaper.com
Slide 7: Market data: fine paper prices
GRAPHIC FINE PAPER PRICES – GERMAN MARKET MARKET DATA Fine paper average market prices 1400 1300 1200 DEC 2023 COMPARED TO SEP 2023 1100 UWF average price change 0,0% 1000 CWF average price change 0,0% 900 800 700 DEC 2023 COMPARED TO DEC 2022 600 UWF average price change - 9,8% CWF average price ch
Slide 8: Operating data: production capacity and paper sales volume
PRODUCTION CAPACITY FOR ARCTIC PAPER MILLS OPERATING DATA 92% 99% 99% 85% 71% 66% 70% 55% Average Q4 2023 use of production capacity: 70% 4% HIGHER THAN IN Q3 2023 15% LESS THAN IN Q4 2022 Q4 2023 total sales volume: 113k tons PAPER SALES VOLUME 4,5% HIGHER THAN IN Q3 2023 3,5% LESS THAN IN Q4 2022
Slide 9: Operating data: paper sales revenue
PAPER SALES REVENUE (PLN mn) OPERATING DATA 949 770 770 689 567 581 581 507 527 Total revenue Q4 2023 (PLN 581mn) DECREASED BY 1,5% COMPARED TO Q3 2023 Average price Q4 2023 (PLN 5.14k) PAPER SALES REVENUE PER TONNE (PLN k)* DECREASED BY 6% COMPARED TO AVERAGE IN Q3 2023 6,57 5,74 5,85 5,14 4,11 3,4
Slide 10: Products
PRODUCTS ADVANCED OFFSET MOST COMPLETE MATT BIGGEST UNCOATED PRODUCTION COATED PAPER ASSORTMENT DESIGN BRAND IN HEART OF EUROPE • Top 3 brands in revenue share • No 1 in European High Quality Bookpaper Sales • No 1 in European Design Paper Sales 10 Q4 2023 www.arcticpaper.com
Slide 11: Products: geographical split of sales
PRODUCTS Geographical split of sales Outside Europe 1% Germany Poland UK & IE Austria & CE France Baltics Rest of Europe 22% 17% 12% 10% 9% 6% 9% The Nordics Benelux 10% 4% 11 Q1 Q4 2023 2023 www.arcticpaper.com www.arcticpaper.com
Slide 12: Client structure
CLIENT STRUCTURE Market segments/products portfolio/target grups BUYING CUSTOMERS Printing Houses Clients who purchase the Group’s paper products directly. NON-BUYING CUSTOMERS Brand Owners Merchants Predominantly indirect customers, who use our Direct customers who purchase, stock and distribute pr
Slide 13: Pulp
PULP 13 Q4 2023 www.arcticpaper.com
Slide 14: Market data: pulp PIX indexes Europe
PULP PIX INDEXES EUROPE (USD PER TONNE) MARKET DATA 1 498 Pulp – European pulp prices 1 430 1 429 1 342 1 370 1 3001 340 1 260 1 380 1 380 1 240 1 244 1 308 1 147 1 280 1 030 1 177 AVERAGE PRICE Q4 2023 COMPARED TO Q4 2022 1 140 1 140 1 099 879 1 001 NBSK (long fiber): 8% lower 958 BHKP (short fiber
Slide 15: Operating data: pulp production and deliveries
PULP PRODUCTION (1,000 TONNE) OPERATING DATA Pulp production & deliveries 109 111 103 103 92 96 93 91 90 89 87 87 80 80 Q4 2023 total production: 80k tons 10% LOWER THAN IN Q3 2023 8% LOWER THAN IN Q4 2022 PULP DELIVERIES (1,000 TONNE) Q4 2023 total deliveries: 85k tons 112 106 103 100 102 93 96 96
Slide 16: Operating data: pulp revenue and prices
PULP SALES REVENUE (SEK mn) OPERATING DATA Revenue and prices 784 730 730 681 637 593 598 637 Total revenue Q4 2023 (SEK 637mn) DECREASED BY 13% COMPARED TO Q4 2022 PULP SALES REVENUE PER TONNE (SEK) Average price in Q4 2023 (SEK 7.5k per tonne) 8 439 DECREASED BY 11% COMPARED TO Q4 2022 8 215 7 404
Slide 17: Pulp – replacement material for plastic
PULP – REPLACEMENT MATERIAL FOR PLASTIC Pulp Sales (Rottneros) by application 2023 Printing Fiber Other and writing cement 2% paper 2% 3% Tissue paper Board 9% and packaging 29% Special applications 12% Electrotechnical applications Filters 20% 24% 17 Q4 2023 www.arcticpaper.com
Slide 18: Packaging
PACKAGING 18 Q4 2023 www.arcticpaper.com
Slide 19: Packaging paper sales development
PACKAGING PAPER SALES DEVELOPMENT (t) DEVELOPMENT 20 000 PACKAGING PAPERS: 16 000 Munken Kraft Uncoated packaging paper 12 000 G-Flexmatt 8 000 Coated packaging paper 4 000 0 2018 2019 2020 2021 2022 2023 19 Q4 2023 www.arcticpaper.com
Slide 20: Power
POWER 20 Q4 2023 www.arcticpaper.com
Slide 21: Arctic Paper Group power projects
ARCTIC PAPER GROUP POWER PROJECTS MUNKEDAL • Hydro power plant • Flexible multifuel boiler plant • LNG power plant • Swedish national grid GRYCKSBO • Biomass power plant • Swedish national grid KOSTRZYN • Local natural gas power plant • Solar park • Plus supply to Polish national grid 21 Q4 2023 www
Slide 22: Kostrzyn solar farm
KOSTRZYN SOLAR FARM • 17 MW • Start up June 2024 • Next phase under preparation 2025 22 Q4 2023 www.arcticpaper.com
Slide 23: Financial performance
FINANCIAL PERFORMANCE 23 Q4 2023 www.arcticpaper.com
Slide 24: EBITDA evolution 2016 – 2023 (PLN mn)
EBITDA EVOLUTION 2016 – 2023 (PLN mn) Effective hedging of both segments – to stabilize financial results 1 000 900 Q4 2023 EBITDA PLN 96.3mn 800 PLN 44mn LOWER THAN Q4 2022 700 PLN 28mn LOWER THAN Q3 2023 600 500 400 300 200 100 0 2016 2017 2018 2019 2020 2021 2022 2023* Paper Segment Pulp Segment
Slide 25: EBITDA margin by segment
EBITDA MARGIN BY SEGMENT 2015 – 2023 2015 2016 2017 2018 2019 2020 2021 2022 2023 paper margin 3% 7% 6% 3% 6% 12% 7% 19% 15% pulp margin 19% 13% 13% 17% 15% 5% 16% 22% 10% group margin 7% 8% 8% 7% 9% 10% 10% 20% 13% 25 Q4 2023 www.arcticpaper.com
Slide 26: Net debt/EBITDA 2019 – 2023
NET DEBT/EBITDA 2019 – 2023 0,83 0,70 0,70 0,66 0,57 0,57 0,48 0,49 0,36 0,33 -0,02 -0,19 -0,22 -0,28 -0,27 -0,59 -0,73 * rolling 12 months 26 Q4 2023 www.arcticpaper.com
Slide 27: Focus
FOCUS 27 Q4 2023 www.arcticpaper.com
Slide 28: Focus: macro uncertainty, margins vs capacity, energy projects
• Uncertain macroeconomic environment • Optimizing between margins and capacity utilisation • Continiue on energy projects 28 Q4 2023 arcticpapergroup.com
Slide 29: Sharing our story with you
SHARING OUR STORY WITH YOU HEDGED AGAINST VOLATILITY GROWTH INCREASING SHARE PREDICTABLE CAPEX OF PROFITABILITY IN PACKAGING OF RENEWABLE AND AIMED AT CONTINUED & HIGH FLUCTUATION FOSSIL-FREE ENERGY IMPROVEMENTS OF ENERGY ESTABLISHED OWNER POSITION ON THE STABLE SUSTAINABLE OF BRANDS VALUED MARKET W
Slide 30: 4P For Future Arctic
4P For Future Arctic Paper Packaging Pulp Power 30 Q4 2023 www.arcticpaper.com
Slide 31: Thank you
Thank you ARCTIC PAPER