Arctic Paper S.a. · GPW:ATC
Arctic Paper — FY2017 Earnings Presentation
32 slides from Arctic Paper's earnings presentation, Apr 10, 2018
Slide 1: Arctic Paper S.A. 2017 – A future in paper
Per Skoglund – CEO Arctic Paper | Warsaw, 10.04.2018 Göran Eklund – CFO Arctic Paper Arctic Paper S.A. 2017 A future in paper
Slide 2: Disclaimer
Disclaimer Please read the information below carefully This presentation (the ‘Presentation’) was prepared by Arctic Paper S.A. (the The Company is not obliged to publish updates and amendments to the information, ‘Company’) for information purposes only for use by investors, banks and the Company’s
Slide 3: Content
Content 1. 2017 in brief 2. New strategy 3. Market environment 4. Operations and financial results 5. Summary arcticpaper.com
Slide 4: 2017 in brief
2017 in brief 2017 – Full year presentation arcticpaper.com
Slide 5: Important events
Important events 2017 • Developed new strategy • Decision to increase capacity in APK • Continued high pulp prices • New CFO 2018 • Implementation of new strategy • Decision to invest in hydro power in APM 2017 – Full year presentation arcticpaper.com
Slide 6: Financial Summary Q4: A strong final quarter of 2017
Financial Summary Q4: A strong final quarter of 2017 Arctic Paper Group Q4 2017 vs. Q4 2016 PLN PLN PLN PLN 740,0 m 33,6 m 99,6 m -0.46% +3.2% -12% +14.4% Revenues EBI TD A O perat i ng Cash Fl ow RO CE 2017 – Full year presentation arcticpaper.com
Slide 7: Financial Summary 2017: Stable results in a tough market
Financial Summary 2017: Stable results in a tough market Arctic Paper Group FY, 2017 vs. FY, 2016 PLN PLN PLN PLN 2,952,8 m 244,4 m 261,6m +8.27% -0.5% -2.1% +41.4% Revenues EBI TD A O perat i ng Cash Fl ow RO CE 2017 – Full year presentation arcticpaper.com
Slide 8: The Management Board proposes a dividend of PLN 0.2 per share
The Management Board proposes a dividend of PLN 0.2 per share 2017 – Full year presentation arcticpaper.com
Slide 9: New strategy – A future in paper
New strategy – A future in paper 2017 – Full year presentation arcticpaper.com
Slide 10: Our vision: Turning ideas into experiences
Our vision Turning ideas into experiences. 2017 – Full year presentation arcticpaper.com
Slide 11: A future in paper – The new strategic agenda 2022
A future in paper – The new strategic agenda 2022 Strategic initiatives Target 2022 Growth Innovation Branding 10% EBIT Efficiency Performance Sustainability 2017 – Full year presentation arcticpaper.com
Slide 12: We go for growth
We go for growth New Cent ral and East ern Europe Fut ure i nnovat i on New market s and expansi on G eog r aphic m ar k et f or hi gh val ue product s Focus on Kraf t papers sel ect ed Di gi t al papers and prof i t abl e New grades Existing segment s Cust omer Seg ment Existing New 2017 – Full yea
Slide 13: We focus on innovation
We focus on innovation Improved service offer Develop new grades and surfaces Optimize the R&D organization 2017 – Full year presentation arcticpaper.com
Slide 14: We build on our brands
We build on our brands Premi um Brands Brands Munken Arctic Volume Amber G-Print Arctic 2017 – Full year presentation arcticpaper.com
Slide 15: Building strong brands = higher profit per tonne
Building strong brands = higher profit per tonne 2017 – Full year presentation arcticpaper.com
Slide 16: We optimize our operations
We optimize our operations A lean company Productivity improvements Cost optimizations 2017 – Full year presentation arcticpaper.com
Slide 17: We strive for a performance culture
We strive for a performance culture Performance management Leadership and employmentship A common project process 2017 – Full year presentation arcticpaper.com
Slide 18: We care for people and the environment
We care for people and the environment Zero injuries Setting KPI:s for progress Communication 2017 – Full year presentation arcticpaper.com
Slide 19: Market environment
Market environment 2017 – Full year presentation arcticpaper.com
Slide 20: Fine paper prices are increasing
Fine paper prices are increasing Graphic fine paper prices – German market DEC 2017 compared to SEP 2017 1000 • UWF segment average price change +2.1% 900 • CWF segment average price change +2.1% 800 700 600 UWF 80g Sheets UWF 80g Reels CWF 90g Sheets CWF 90g Reels Source: Arctic Paper based on RISI
Slide 21: Pulp prices remains a challenge
Pulp prices remains a challenge 900 Pulp PIX Indexes Europe Average price Q4 2017 compared to Q4 2016 1 100 800 1 000 700 932 • NBSK (long fibre): 17.8% higher 900 880 853 839 826 890 906 979 600 803 806 810 809 500 789 890 832 • BHKP (short fibre): 43.7% higher 797 810 400 789 700 743 759 737 722 3
Slide 22: Currency exchange rates
Currency exchange rates EUR/PLN changes Average exchange rate Q4 2017 compared to Q3 2017 4,6 4,5 • EUR/PLN -0.6% 4,4 4,3 4,2 31/12 • EUR/SEK +2.4% 4,1 2015 2016 4.17 2017 • EUR/USD +0.2% EUR/SEK changes 10,3 10,0 Average exchange rate Q4 2017 compared to Q4 2016 9,8 9,5 • EUR/PLN -3.3% 9,3 31/12 9.
Slide 23: Operations and financial results
Operations and financial results 2017 – Full year presentation arcticpaper.com
Slide 24: Stable output from production
Stable output from production Production and use of production capacity for all paper mills* 600 120% Average 2017 use of budget production capacity: 450 97% 99% 89% 93% 95% 98% 94% 95% 95% 98% 98% 98% 98% 100% 98% 300 80% 168 174 169 166 169 167 161 167 162 164 165 151 158 • 2.0% higher than in 201
Slide 25: Paper sales revenue and revenue per tonne
Paper sales revenue and revenue per tonne Paper sales revenue* 800 579 590 569 575 Total 2017 (PLN 2,174m) down 2.1% 600 504 535 524 498 542 525 540 520 513 542 543 520 543 compared to 2016 400 200 0 * AP Mochenwangen excluded from sales revenue Paper sales revenue per tonne* Average 2017 (PLN 3,28k
Slide 26: Key consolidated figures
Key consolidated figures • YTD DEC 2017 total revenues down -0.5% compared to YTD DEC 2016 (-2.1% paper segment, +4.2% pulp segment revenue) • YTD DEC 2017 EBITDA down by PLN 5,2m compared to YTD DEC 2016 (131m PLN paper segment: -17,1m PLN; 113,4m PLN pulp segment: +11,9m PLN) • YTD DEC 2017 Net re
Slide 27: Q4 2017 EBIT Arctic Paper (excluding Rottneros)
Q4 2017 EBIT Arctic Paper (excluding Rottneros) Q4 operating result Bridge 50 +3 -31 40 +19 30 Q4 2017 operating result -18m PLN 20 +17 10 -0,5 -1 -2 -24 • -36,7m PLN less than Q3 2017 0 -18 • -35,3m PLN less than Q4 2016 -10 -20 EBIT evolution 29 19 19 17 11 17 9 7 -3 -18 -18 2017 – Full year prese
Slide 28: Q4 2017 EBIT Arctic Paper Group – total
Q4 2017 EBIT Arctic Paper Group – total Q4 EBIT Bridge 50 +3 -31 +19 40 30 Q4 2017 EBIT -6m PLN +22 20 -0,5 -1 -2 -24 • -44.6m PLN less than Q3 2017 10 -6 0 +7 • -8m PLN less than Q4 2016 -10 -20 EBIT evolution 48 41 44 39 34 33 22 22 -6 -6 -6 2017 – Full year presentation arcticpaper.com
Slide 29: Overview of Q4 2017
Overview of Q4 2017 Market environment • Still unfavourable pulp prices development in Q4 2017 for paper segment, BHKP, short fibre average Q4 2017 +43.7% and NBSK, long fibre average Q4 2017 +17.8% if compared to Q4 2016, accordingly BHKP +7.8% and NBSK +6.6% if compared average Q4 2017 to Q3 2017;
Slide 30: Summary
Summary 2017 – Full year presentation arcticpaper.com
Slide 31: Summary
Summary • Capacity increase in Kostrzyn • Investing in hydro power in Munkedal • New strategy – A future in paper • Financial target 10% EBIT 2017 – Full year presentation arcticpaper.com
Slide 32: Thank you
Thank you CH) ARCTIC PAPER