Stora Enso Oyj Class A · OMXHEX:STEAV
Stora Enso Oyj Class A — Investor Presentation (August 2014)
20 slides from Stora Enso Oyj Class A's investor presentation, Aug 26, 2014
Slide 1: Stora Enso's strategy and market environment
Stora Enso’s strategy and market environment CFO Seppo Parvi 26 August 2014
Slide 2: and profitability; and statements preceded by “believes”, “expects”, “anticipates”, “foresees”, or similar by the
It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding expectations for market growth and developments; expectations for growth and profitability; and statements preceded by “believes”, “expects”, “anticipates”, “foresees”, or
Slide 3: Growth businesses around 60% of sales
Growth businesses* around 60% of sales Group sales EUR 10.5 billion in 2013 Renewable Packaging** Biomaterials** Printing and Living** Sales 3 272 MEUR Sales 1 033 MEUR Building and Living Sales 1 867 MEUR Operational EBITDA 522 MEUR Operational EBITDA 153 MEUR Operational EBITDA 115 MEUR Operationa
Slide 4: Significant operational earnings improvement continues
Significant operational earnings improvement continues Q2 2014 year-on-year • Sales EUR 2 579 (EUR 2 726) million, structural paper demand decline • Operational EBITDA margin of 12.6 (9.4) %, EUR 326 (EUR 257) million • Operational EBIT margin of 8.1 (4.5) %, EUR 209 (EUR124) million • Net debt to O
Slide 5: Company strategy
Company strategy Transformation from a European pulp and paper company to a value creating, growth markets renewable materials company Stora Enso 26 August 2014 5
Slide 6: Transformation on-going
Transformation on-going Sales and Operational EBIT 2006 Sales 2013 Sales 20XX Sales -3 % 1% 21 % 31 % 30 % 41 % 12 % 70 % 70 % 18 % 10 % -3 % 13 % 6 % 13 % 35 % 13 % 62 % 6% 55 % 2006 Operational EBIT 2013 Operational EBIT Stora Enso 26 August 2014 6
Slide 7: Transforming to value creating growth
Transforming to value creating growth Skoghall, Sweden, Sunila, Finland, lignin extraction plant and dryer, lignin dust burners woodyard logistics, in the lime kilns and a packing line, start up during Q1 of 2015 investment started up on time, in Nov 2012 Varkaus, Finland, conversion of fine paper m
Slide 8: Strongest growth in packaging will be in Asia
Strongest growth in packaging will be in Asia – Increasing demand of consumer board in China CAGR CAGR CAGR 0,2 % 1,4 % 4,6 % CAGR 1,5 6,9 % 0,9 4,4 3,8 Eastern 6,3 6,2 Europe Western CAGR Europe 3,3 % North 11,6 0,7 0,5 America Middle East 6,0 & Africa Asia Fibre-based consumer CAGR 2010-2020 CAGR
Slide 9: Guangxi investment proceeding as planned
Guangxi investment proceeding as planned • IFC equity and loan • Key equipment selected • Over 90% of the levelling work completed • Construction planned to start early September • Harvesting the plantations and selling the wood • Board machine operational early 2016 as previously announced Stora En
Slide 10: Corrugated packaging grows also in Europe
Corrugated packaging grows also in Europe Nordic SC Fluting Global market size (kt) RCP–based containerboard Europe (kt) (Kt) (Kt) 1000 25000 + 2 514 Kt + 80 Kt 840 21575 19061 + 1.8% 760 + 1.4% 800 20000 600 15000 400 10000 200 5000 0 0 2013 2020 2013 2020 Kraftliner Europe (kt) Corrugated packagin
Slide 11: Fine paper machine to be converted to light-weight containerboard in Varkaus Mill
Fine paper machine to be converted to light-weight containerboard in Varkaus Mill • EUR 110 million for conversion • EBITDA margin above 15% • Start up Q4 2015 • Capacity 390 000 tonnes of kraftliner • Uncoated fine paper capacity to reduce by 280 000 tonnes Stora Enso 26 August 2014 11
Slide 12: Chemical market pulp demand to increase from 55 to 60 Mt in 2013–2018
Chemical market pulp demand to increase from 55 to 60 Mt in 2013–2018 (Kt) 70 000 100% 60 000 95% 50 000 90% 40 000 85% 30 000 80% 20 000 75% 10 000 0 70% 2013 2014 2015 2016 2017 2018 Capacity Demand Supply/Demand balance Source: Pulp and Paper Products Council, 2014 Stora Enso 26 August 2014 12
Slide 13: Montes del Plata: state-of-the-art pulp mill
Montes del Plata: state-of-the-art pulp mill • Pulp mill investment in Uruguay • Annual production capacity 1.3 million tonnes – Stora Enso’s share 650 000 tonnes – Joint venture with Arauco – Stora Enso’s share of 2014 production 300 000 - 350 000 tonnes • Start-up June 2014 • Eucalyptus pulpwood s
Slide 14: Major biomass' components – half of this is burnt now
Major biomass’ components – half of this is burnt now +Extractives Stora Enso 26 August 2014 14
Slide 15: Virdia acquisition – enabling step-change entry into high value renewable materials technologies
Virdia acquisition – enabling step-change entry into high value renewable materials technologies • A leading developer of extraction and separation technologies for conversion of cellulosic biomass into highly refined sugars and lignin – A pilot facility in Danville, Virginia • Cost-competitiveness
Slide 16: Building and Living: Strong global player
Building and Living: Strong global player # 1 wood products company in Europe • Wood-based innovations and solutions for everyday living and housing needs • Public and private sector customers, such as construction companies, merchandisers and retailers • Part of Printing and Living Division Massive
Slide 17: Printing and Reading focuses on cash generation
Printing and Reading focuses on cash generation • Paper solutions for print media and office use • Customers: publishers, printing houses, merchants, retailers, converters and office suppliers • End uses: newspapers and supplements, books, magazines, advertising, note books, art books, office • Part
Slide 18: Sales, EBITDA margins and EBIT margins
Sales, EBITDA margins and EBIT margins Renewable Packaging Biomaterials Sales, MEUR Operational EBITDA margin Operational EBIT margin Sales, MEUR Operational EBITDA margin Operational EBIT margin 860 25% 280 20% 18% 840 270 20% 16% 14% 820 260 15% 12% 800 250 10% 10% 8% 780 240 6% 5% 4% 760 230 2% 7
Slide 19: Balance Sheet strength
Balance Sheet strength Q2 2012 – Q2 2014 MEUR 3 600 3,3 3 500 3,2 3 400 3,1 3 300 3,0 3 200 2,9 3 100 2,8 3 000 2,7 2 900 2,6 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14Q1 14Q2 Net Debt Net Debt/Operational EBITDA* *Last twelve months’ operational EBITDA Stora Enso 26 August 2014 19
Slide 20: Stora Enso 26 August 2014
Stora Enso 26 August 2014 20