29 slides from Svenska Cellulosa Ab Sca Class A's earnings presentation, Jan 29, 2021
Slide 1: Year-end Report Presentation
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Slide 2: Ulf Larsson, CEO
Slide 3: A year of transformation
EBITDA1 (SEKm) and EBITDA margin A year of transformation -17% • Exit publication paper 5,319 5,252 • CTMP investment in Ortviken SEK 1.45bn 4,440 • Obbola expansion on time and budget • Increased growth and harvesting level 3,781 3,648 3,300 3,385 28% 27% COVID-19 impacted sales and earnings – limi
Slide 4: Full-year 2020 key figures
EBITDA (SEKm) Industrial ROCE 1) Proposed dividend (SEK) 4,440 5% 2.00 (5,319) (12%) (0.00) EBITDA margin Net debt/EBITDA EPS (SEK) 24% 1.7x 3.19 (27%) (1.6x) (4.05) Note: Excluding effect of one-off items related to discontinuation of publication paper in 2020 4 and effects from changed accounting
Slide 5: Q4 2020 highlights: more balanced market
More balanced market Sales increased 7% vs Q4 2019 • Volume 13%, price/mix -3%, currency -2%, divestments -1% EBITDA1 up 31% vs Q4 2019 + Lower raw material costs, higher revaluation + Lower costs including maintenance stop - Lower selling prices on publication paper and kraftliner - Lower publicati
Slide 6: EBITDA and EBITDA development by quarter
EBITDA development (SEKm) EBITDA (SEKm) 1,377 1,494 1,560 +31% 1,340 1,364 1,377 1,055 1,030 1,032 1,001 30% 31% 30% EBITDA margin 27% 26% 24% 24% 21% 30% 21% Q4 '18 Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Note: Excluding effect of one-off items related to discontinuation of publicat
Slide 7: Wood: stable wood supply to industries
Net sales (SEKm) EBITDA (SEKm) EBITDA margin -2% +23% Stable wood supply to industries 1,694 1,659 747 45.0% 607 35.8% Sales down 2% - Lower volumes to Ortviken - Lower pulpwood price EBITDA up 23% Q4 2019 Q4 2020 Q4 2019 Q4 2020 Q4 2019 Q4 2020 + Higher harvesting from SCA-owned forest + Higher ear
Slide 8: Solid wood products: continued high demand in all markets
Net sales (SEKm) EBITDA (SEKm) EBITDA margin +9% +82% Continued high demand in all markets 1,498 227 15.2% 1,376 Wood Supply UK divested on December 1, SCA 9.1% retains sales to industrial customers in the UK 125 Sales up 3% + Higher volumes - Divestment of Wood Supply UK Q4 2019 Q4 2020 Q4 2019 Q4
Slide 9: Pulp: planned maintenance stop, stable production
Net sales (SEKm) EBITDA (SEKm) EBITDA margin +30% +445% Planned maintenance stop 1,166 109 9.3% Stable production 900 Sales up 30% + Increased volumes 2.2% 20 EBITDA up 445% Q4 2019 Q4 2020 Q4 2019 Q4 2020 Q4 2019 Q4 2020 + Higher volumes + Lower costs for wood raw material Price development – NBSK
Slide 10: NBSK pulp market and inventories
NBSK pulp price (USD/t) vs deliveries (Mt) Hardwood pulp inventories (days of supply) 1,300 15.0 80 1,200 14.5 70 1,100 14.0 60 1,000 13.5 Average 50 900 13.0 40 800 NBSK PIX Price Europe 700 12.5 30 NBSK deliveries (RHS) 600 12.0 20 Softwood pulp inventories (days of supply) 50 Limited supply due t
Slide 11: Paper: decision taken to exit publication paper
Net sales (SEKm) EBITDA (SEKm) EBITDA margin -6% -10% Decision taken to exit publication paper in 2,108 382 18.1% 1,981 342 17.3% September Temporarily improved capacity utilization in Q4 (ahead of exit in Q1) Sales down 6% - Lower kraftliner and publication paper prices Q4 2019 Q4 2020 Q4 2019 Q4 2
Slide 12: Strong demand and prices on the rise (kraftliner)
Price (EUR/t) vs Kraftliner deliveries (Mt) European Box demand (index) 850 6.5 114 800 112 750 6.0 110 700 108 5.5 106 650 104 600 5.0 Unbleached kraftliner price Euwid (LHS) 102 550 Kraftliner deliveries from Europe (RHS) 100 500 4.5 98 Kraftliner inventories (days of supply) Strong demand and pri
Slide 13: Toby Lawton, CFO
Slide 14: Higher transaction prices for forest assets in Northern Sweden
Market price Standing volume Forest asset (SEK/m3fo) (m m3fo) (SEK bn) Higher transaction prices for forest assets in Northern Sweden +15 +5 +5 291 252 257 74.9 276 69.7 291 SEK/m3fo at Dec 31 2020 • Average three year transaction price in SCAs region 5m3fo higher standing volume compared to 2019 •
Slide 15: Effects of one-off items related to exit publication paper
Effects of one-off items related to exit Quarter Jan-Dec publication paper in 2020 SEKm Q4 2020 Q4 20201) 2020 20201) Reported in segment Other Net sales 4,592 4,592 18,410 18,410 Impact on EBITDA of SEK -1,047m EBITDA 1,451 1,377 3,393 4,440 EBIT 1,084 986 1,145 2,839 • SEK 73m in Q4 Profit for the
Slide 16: Quarter and full year income statement
Quarter Full year SEKm 1) Q4 2020 Q4 2019 Change 2020 2019 Change Net sales 4,592 4,312 7% 18,410 19,591 -6% EBITDA 1,377 1,055 31% 4,440 5,319 -17% EBITDA margin 30.0% 24.5% 5.5 p.p. 24.1% 27.2% -3.1 p.p. EBIT 986 637 55% 2,839 3,703 -23% EBIT margin 21.5% 14.8% 6.7 p.p. 15.4% 18.9% -3.5 p.p. Finan
Slide 17: Net sales bridge 2019 to 2020
Positive for wood, pulp, Divestment of Wood Supply kraftliner, negative for UK in 2020 and Lower prices in all segments publication paper deconsolidation in Wood France 2019 SEK 19,591m -8% SEK +2% +1% -1% 18,410m - 6% Net sales Price/Mix Volume Currency Acquisitions/ Net sales 2019 divestments 2020
Slide 18: EBITDA bridge 2019 to 2020
Lower costs for wood raw Lower utilization on Lower prices in all segments material, higher earnings in publication paper machines, forest divestments in 2019 SEK 5,319m -1,785 +1,119 -126 +195 -322 SEK 4,440m +40 Higher energy prices - 17% EBITDA margin EBITDA margin 27.2% 24.1% EBITDA Price/Mix Vo
Slide 19: Net sales and EBITDA by segment, annual
Forest Wood Pulp Paper Net sales (SEKm) 9,643 9,229 8,226 8,548 8,434 7,916 7,744 6,956 6,618 6,325 6,296 6,486 5,994 5,187 5,108 4,978 5,070 5,455 5,114 5,315 5,441 4,377 4,431 2,518 2,760 2,492 2,542 2,866 2014 2015 2016 2017 2018 2019 2020 2014 2015 2016 2017 2018 2019 2020 2014 2015 2016 2017 20
Slide 20: Net sales bridge Q4 2019 to Q4 2020
Lower kraftliner and publication paper Higher pulp and prices Divestment Wood kraftliner volumes Supply UK SEK SEK +13% -2% -1% 4,592m 4,312m -3% + 7% Net sales Price/Mix Volume Currency Acquisitions/ Net sales Q4 2019 divestments Q4 2020 20
Slide 21: EBITDA bridge Q4 2019 to Q4 2020
Lower costs for wood raw material, higher earnings in forest Lower kraftliner and Higher pulp and SEK publication paper kraftliner volumes +445 +10 -54 +55 1,377m prices SEK 1,055m -171 +37 + 31% EBITDA margin EBITDA margin 24.5% 30.0% EBITDA Price/Mix Volume Raw material Energy Currency Other EBITD
Slide 22: Net sales and EBITDA by segment, quarterly
Forest Wood Pulp Paper 2,366 2,375 2,380 2,242 Net sales (SEKm) 2,108 1,981 1,876 1,817 1,865 1,833 1,770 1,746 1,727 1,694 1,678 1,659 1,651 1,592 1,545 1,500 1,498 1,494 1,436 1,376 1,214 1,188 1,166 1,134 1,129 1,091 986 900 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 23: Cash flow
Quarter Full year SEKm Q4 2020 Q4 2019 2020 2019 EBITDA 1,451 17,098 3,393 21,361 Revaluation of biological assets and other non cash flow items -510 -16,367 -601 -16,979 Operating cash surplus 941 731 2,792 4,382 Change in working capital 275 140 1,131 -186 Current capital expenditures -298 -370 -1
Slide 24: Net debt development
Kraftliner expansion SEK SEK SEK SEK SEK SEK 8,294m -957m SEK SEK +462m -63m -51m -271m Lease 792 +257m 7,671m 751 Lease Strong focus on Forest land Batics cost control Net debt / EBITDA1 Net debt / EBITDA1 2.0x 1.7x Net debt Operating Strategic capex Acquisitions Divestments Paid tax Other Net debt
Slide 25: Capital employed and financial position
SEKm Dec 31, 2020 Dec 31, 2019 Forest assets 74,900 69,682 Working capital 2,759 3,748 Working capital/Net sales 1 18% 20% Deferred tax relating to forest assets -14,977 -13,977 Other capital employed 17,152 17,654 Total capital employed 79,834 77,107 Net debt 7,671 8,597 Net debt/EBITDA 2 1.7x 1.6x
Slide 26: Summary
Summary Ulf Larsson, CEO WSCA
Slide 27: A year of transformation
A year of transformation • Exit publication paper • CTMP investment in Ortviken SEK 1.45bn • Obbola expansion on time and budget • Increased growth and harvesting level COVID-19 impacted sales and earnings – limited impact on production and distribution Sales declined 6% vs 2019 • Price/mix -8%, vol
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Slide 29: Forward-looking statements
This presentation may contain forward-looking statements. Such statements are based on our current expectations and are subject to certain risks and uncertainties that could negatively affect our business. Please read SCA’s most recent annual report for a better understanding of these risks and unce