Holmen Ab Class A · OMXSTO:HOLM_A
Holmen Ab Class A — Q2 2024 Earnings Presentation
28 slides from Holmen Ab Class A's earnings presentation, Aug 14, 2024
Slide 1: Interim report presentation January-June 2024
Interim report presentation January-June 2024 Henrik Sjölund, CEO Anders Jernhall, CFO August 15th, 2024
Slide 2: Solid earnings despite slow cycle
Group Solid earnings despite slow cycle Operating profit* Operating profit* SEKm SEKm 8 000 2 500 7 000 2 000 6 000 5 000 1 500 4 000 7 262 1 000 2 101 1 921 3 000 1 622 1 737 4 755 1 138 1 166 2 000 4 061 3 806 500 944 983 714 2 345 2 479 1 000 0 0 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Q2
Slide 3: 16% ROCE in our industry H1 2024
Group 16% ROCE in our industry H1 2024 18% average for the last 10 years % 60 50 40 30 20 10 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 H1-24 Industry's return on capital employed Average return on capital employed, industry 3
Slide 4: Net debt at 6% of equity
Group Net debt at 6% of equity SEK 1.8 bn dividend distributed in Q2 Capital employed SEKm Cash flow 8 000 7 000 Forest Renewable Energy 6 000 Wood Products Board and Paper 5 000 4 000 3 000 % Debt/equity ratio 2 000 25 20 1 000 15 10 0 5 19 20 21 22 23 M12* 0 Dividend Buy-back of own shares 19 20 2
Slide 5: Forest
Forest 1.3 million ha total land area 1.0 million ha productive forest land
Slide 6: Lack of wood pushing up prices to record levels
Forest Lack of wood pushing up prices to record levels Despite slow end markets Wood cost at mill gate Index (Holmen average) 200 180 160 140 120 100 80 60 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Saw logs Pulpwood 6
Slide 7: Still good mark-up on wood for pulp
Forest Still good mark-up on wood for pulp Normal relationship between sawn wood & net log cost Sales price sawn wood less Sales price pulp less Index Index net log cost per m3 sawn wood wood cost per tonne of pulp 350 350 300 300 250 250 200 200 150 150 100 100 50 50 0 0 7
Slide 8: Harvesting cash-flow has increased 60% in 3 years
Forest Harvesting cash-flow has increased 60% in 3 years SEKm SEKm 500 1 800 1 600 400 1 400 1 200 300 1 000 490 1 723 452 800 200 402 397 1 495 1 523 390 384 1 367 1 401 349 346 351 600 1 172 100 400 200 0 0 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Q2-24 19 20 21 22 23 M12** Operating profit
Slide 9: Real price increase of 1,6% p.a. last 20 years
Forest Real price increase of 1,6% p.a. last 20 years Standing timber volume has grown by 0,6% per year Nominal price m 3 growing stock Forest holdings SEK/m 3sub solid over bark/ha 800 140 700 120 100 600 80 500 60 400 40 300 20 200 0 H1-24 2002 2003 2004 2005 2006 2007 2008 2010 2012 2013 2014 201
Slide 10: Renewable Energy
Renewable Energy 1.8 TWh per year
Slide 11: Spread vs Germany widened again in Q2
Renewable Energy Spread vs Germany widened again in Q2 Nordic prices 20% below normal levels for a Q2 Energy prices EUR/MWh 250 200 150 100 50 0 2019 2020 2021 2022 2023 2024 South Sweden (SE3) North Sweden (SE2) Germany 11 Source: Macrobond
Slide 12: Developing a wind farm portfolio
Renewable Energy Developing a wind farm portfolio Feasibility Preparing permission Granted In studies application permission operation 20 3 1 2 Screening Areas with potential for wind power: 270 Whereof suitable for wind power: 160 In-depth Authorities review Under analysis application construction
Slide 13: Supporting the emerging green industry
Renewable Energy Supporting the emerging green industry Northern Sweden TWh per year 120 100 80 60 40 20 0 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Electricity consumption 2023 Planned electricity consumption from new green industry 13 Source: Syspower, public data and Holmen
Slide 14: Low prices & production in Q2
Renewable Energy Low prices & production in Q2 SEKm % SEKm % 500 125 1 250 25 400 100 1 000 20 300 75 750 15 463 200 50 500 1 006 10 282 697 100 214 213 208 25 250 548 5 162 347 135 336 68 215 59 0 0 0 0 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Q2-24 19 20 21 22 23 M12** Operating profit* Ret
Slide 15: 30% premium to market price
Renewable Energy 30% premium to market price SEK/MWh 1600 1400 1200 1000 800 600 400 200 0 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Q2-24 Holmen Renewable Energy North Sweden (SE2) 15
Slide 16: Wood Products
Wood Products 1.5 million m3 per year
Slide 17: Slow constructional cycle
Wood Products Slow constructional cycle Price increase driven by seasonal uptick in demand Index 330 280 230 180 130 80 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Export price 'World Price' (FX-basket) Export price Sawn softwood (SEK) 17 Source: Swedish Forest Industries
Slide 18: Final step of Iggesund saw mill rebuild in Q3
Wood Products Final step of Iggesund saw mill rebuild in Q3 18
Slide 19: 10% price increases
Wood Products 10% price increases SEKm % SEKm % 600 60 2 000 100 500 50 1 500 75 400 40 1 000 50 300 598 30 1 668 200 20 1 237 500 25 100 177 10 62 185 6 23 19 0 0 55 47 0 0 -50 -67 -26 -100 -10 -500 -25 -89 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Q2-24 19 20 21 22 23 M12* Operating profit E
Slide 20: Board and Paper
Board and Paper 1.5 million tonnes per year
Slide 21: Board market gradually recovering
Board and Paper Board market gradually recovering European SBB and FBB demand Prices kton Index 3 000 160 140 2 500 120 2 000 100 1 500 80 60 1 000 40 500 20 0 0 15 16 17 18 19 20 21 22 23 M12* 15 16 17 18 19 20 21 22 23 24 FBB Pulp NBSK** *Q3-23 – Q2-24 21 **Adjusted for rebates Source: CEPI and Fa
Slide 22: Stable paper market
Board and Paper Stable paper market Supported by increasing fibre costs Printing paper demand WE Prices kton Index 16 000 250 14 000 200 12 000 10 000 150 8 000 100 6 000 4 000 50 2 000 0 0 15 16 17 18 19 20 21 22 23 M12* 15 16 17 18 19 20 21 22 23 24 Uncoated magazine & book Coated magazine Newspri
Slide 23: Helping our customers with their CO2 footprint
Board and Paper Helping our customers with their C02 footprint Consumer board, transport packaging, books & magazines GHG Emissions for all Packaging, Tons CO2eq/Ton of Paper P&W, and Newsprint Grades 1,4 1,2 1,0 0,8 0,6 0,4 0,2 0,0 India China Japan Germany Mexico Spain U.K Italy U.S France Canada
Slide 24: Higher board volumes & better mix
Board and Paper Higher board volumes & better mix Headwind from increasing wood costs SEKm % SEKm % 1 600 40 4 000 80 1 400 35 3 500 70 1 200 30 3 000 60 1 000 25 2 500 50 800 20 2 000 40 3 796 600 1 231 15 1 500 30 1 135 2 730 1 041 400 868 10 1 000 20 724 1 792 611 200 370 438 5 500 944 10 886 743
Slide 25: Growing a sustainable future
Growing a sustainable future
Slide 26: 1.3 million ha total land area
Packaging, Wood products books & magazines 1.5 Mm3 1.5 Mton Harvest in own forests Hydro and wind power 2.8 Mm3 1.8 TWh 1.3 million ha total land area
Slide 27: We're beyond net zero
We’re beyond net zero 1.6 Mt CO 2 0.5 Mt CO 2 -0.1 Mt CO e Scope 1+2 2 Net increase in growing forest Net storage in buildings -0.6 Mt CO e Scope 3 2 27
Slide 28: holmen.com
HOLMEN holmen.com