Arctic Paper S.a. · GPW:ATC
Arctic Paper — Q1 2023 Earnings Presentation
31 slides from Arctic Paper's earnings presentation, 2023
Slide 1: Financial Results Q1 2023
FINANCIAL RESULTS Q1 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
PRESENTERS: AGENDA Michał Jarczyński / CEO Arctic Paper Göran Eklund / CFO Arctic Paper Summary Q1 2023 Paper Packaging Financials Pulp Power Focus 3 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 4: Summary Q1 2023
SUMMARY Q1 2023 Arctic Paper Group Q1 2023 vs. Q1 2022 Net sales EBITDA Operating CF ROCE* (PLN mn) (PLN mn) (PLN mn) 1 032.2 1 110.8 185.5 205.7 62.5 17.9 34.5% 20.8% (Q1 2023) (Q1 2022) (Q1 2023) (Q1 2022) (Q1 2023) (Q1 2022) (Q1 2023) (Q1 2022) Paper/Pulp EBITDA Net debt/EBITDA* Paper sales Pulp
Slide 5: Paper
PAPER 5 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 6: Market Data: Fine paper average market prices
GRAPHIC FINE PAPER PRICES – GERMAN MARKET MARKET DATA Fine paper average market prices 1400 1300 1200 MAR 2023 COMPARED TO DEC 2022 1100 UWF average price change - 1,5% 1000 CWF average price change - 2,1% 900 800 700 MAR 2023 COMPARED TO MAR 2022 600 UWF average price change +15% CWF average price
Slide 7: Operating Data: production capacity use
OPERATING DATA Average Q1 2023 use of production capacity: 71% PRODUCTION CAPACITY FOR ARCTIC PAPER MILLS 14% LESS THAN IN Q4 2022 28% LESS THAN IN Q1 2022 92% 99% 99% 90% 85% 69% 71% Q1 2023 total sales volume: 113k tons 4% LESS THAN IN Q4 2022 32% LESS THAN IN Q1 2022 7 Q1 2023 arcticpaper.com arc
Slide 8: Operating Data: paper sales revenue
PAPER SALES REVENUE (PLN mn) OPERATING DATA 1 042 820 820 722 722 645 588 547 492 Total revenue Q1 2023 (PLN 722mn) DECREASED BY 12% COMPARED TO Q1 2022 Average price Q1 2023 (PLN 6.39k) PAPER SALES REVENUE PER TONNE (PLN k)* INCREASED BY 30% COMPARED TO AVERAGE IN Q1 2022 6,19 6,39 4,93 3,43 3,81 3
Slide 9: 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 9 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 10: Products: geographical split of sales
PRODUCTS Geographical split of sales Outside Europe 2% Germany Poland UK & IE Austria & CE France Baltics Rest of Europe 20% 17% 11% 11% 9% 5% 11% The Nordics Benelux 9% 5% 10 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 11: Client Structure
CLIENT STRUCTURE Market segments/products portfolio/target grups Printing Houses Clients who purchase the Group’s paper products directly. Advertising Industry Merchants Predominantly indirect customers, who use our Direct customers who purchase, stock and distribute products, i.e., Deutsche Bank, K
Slide 12: Pulp
PULP 12 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 13: Market Data: European pulp prices
PULP PIX INDEXES EUROPE MARKET DATA 1 498 Pulp – European pulp prices 1 430 1 429 1 340 1 342 1 370 1 300 1 260 1 380 1 380 1 308 1 280 1 030 1 177 AVERAGE PRICE Q1 2023 COMPARED TO Q1 2022 1 140 1 140 1 099 859 840 879 840 NBSK (long fiber): 8% higher BHKP (short fiber): 16% higher 865 680 680 680
Slide 14: Operating Data: pulp production and deliveries
PULP PRODUCTION (1,000 TONNE) OPERATING DATA Pulp production & deliveries 110 109 111 103 103 103 98 95 96 92 91 87 90 90 Q1 2023 total production: 90k tons 3% HIGHER THAN IN Q4 2022 13% LOWER THAN IN Q1 2022 PULP DELIVERIES (1,000 TONNE) Q1 2023 total deliveries: 87k tons 107 107 112 103 106 96 100
Slide 15: Operating Data: pulp revenue and prices
PULP SALES REVENUE (SEK mn) OPERATING DATA Revenue and prices 806 744 744 660 660 542 570 508 Total revenue Q1 2023 (SEK 744mn) INCREASED BY 13% COMPARED TO Q1 2022 PULP SALES REVENUE PER TONNE (SEK) Average price in Q1 2023 (SEK 8.5k per tonne) INCREASED BY 30% COMPARED TO Q1 2022 8 405 8 532 6 597
Slide 16: Pulp – Replacement Material for Plastic
PULP – REPLACEMENT MATERIAL FOR PLASTIC Pulp Sales (Rottneros) by application 2022 Fiber Other Tissue cement 3% paper 2% 4% Printing and writing Board paper and packaging 10% 32% Special applications 14% Electrotechnical Filters applications 20% 15% 16 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 17: Pulp: Geographical split of sales
PULP Geographical split of sales The Nordics Asia Germany Italy North Rest of Europe 32% 22% 15% 13% America 9% 8% 17 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 18: Packaging
PACKAGING 18 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 19: Development: packaging paper sales
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 last 12 months 19 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 20: Power
POWER 20 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 21: Arctic Paper Group Power Generation
ARCTIC PAPER GROUP POWER GENERATION MUNKEDAL • Hydro power plant • Flexible multifuel boiler plant • LPG boiler • Connected to Swedish national grid GRYCKSBO • Biomass power plant • Connected to Swedish national grid KOSTRZYN • CHP power plant (gas from local PL source) • Solar park • Sales of energ
Slide 22: Arctic Paper Group Power Balance
ARCTIC PAPER GROUP POWER BALANCE + approx. 1% Solar Renewable Energy Sources (RES) / Mainly Bio Natural gas Swedish grid Waste/Excess heat energy and some minor Hydro and Solar PV plants 24% 19% 6% 51% The total Energy produced on sites and taken from outside sources in 2022 is: 3.225 GWh The total
Slide 23: Financials
FINANCIALS 23 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 24: EBITDA Evolution 2014 – 2023
EBITDA EVOLUTION 2014 – 2023 (PLN mn) Effective hedging of both segments – to stabilize financial results 1 000 900 Q1 2023 EBITDA PLN 185.5mn 800 PLN 46mn HIGHER THAN Q4 2022 700 PLN 20mn LOWER THAN Q1 2022 600 500 400 300 200 100 0 2016 2017 2018 2019 2020 2021 2022 2023* Paper Segment Pulp Segmen
Slide 25: Net Debt/EBITDA 2019 – 2023
NET DEBT/EBITDA 2019 – 2023 1,06 1,20 0,82 0,57 0,70 0,83 0,70 0,57 0,48 0,49 0,66 0,33 0,36 -0,02 -0,22 -0,28 -0,27 25 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 26: Net Profit per Share
NET PROFIT PER SHARE 9,11 8,92 1,60 1,84 0,18 1,19 * rolling 12 months net profit for the paper segment plus 51% of the net profit for Rottneros divided by the number of shares. 26 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 27: Focus
FOCUS 27 Q1 2023 arcticpaper.com arcticpapergroup.com
Slide 28: Outlook: continued focus on margins over volumes
• Uncertain market outlook, more challenging year is expected • Continued focus on margins over volumes to maintain profitability despite weaker demand • The energy projects are running according to plan. Several new energy and energy efficency projects are in planning phases of different state • Th
Slide 29: The Road Map
THE WAY FORWARD THE ROAD MAP Milestones ahead POWER Phase three PACKAGING of wind Expansion & solar park POWER of packaging Phase two plants of wind & POWER solar park Phase one POWER PACKAGING of wind First solar Fiber base power park POWER project packaging Expansion production plant of hydropower
Slide 30: Sharing Our Story With You
SHARING OUR STORY WITH YOU Hedged against Increasing share Predictable capex volatility of Growth of renewable and aimed at continued profitability & high in packaging fossil-free energy improvements fluctuation of energy Owner Established position Stable Sustainable of brands valued on the market w
Slide 31: 4P for Future Arctic
4P FOR FUTURE ARCTIC Paper Packaging Pulp Power 31 Q1 2023 arcticpaper.com arcticpapergroup.com