27 slides from Svenska Cellulosa Ab Sca Class A's earnings presentation, Jul 23, 2021
Slide 1: Interim Report Q2 2021
ne 4 ‘ \ Peale Interim | Report Pre f
Slide 2: Ulf Larsson, CEO
Slide 3: Best quarter since split in 2017
Best quarter since split in 2017 – strong market with increasing prices in all segments, exit publication paper, good production and stable cost base EBITDA up 126% vs Q2 2020 + Higher prices on solid wood, pulp and kraftliner + Higher volumes + Higher production - Negative currency effects Net sale
Slide 4: EBITDA and Industrial ROCE development
EBITDA (SEKm) Industrial ROCE 1 EBITDA development (SEKm) +126% 2,260 14% 2,260 1,451 47% 1,340 1,364 1,359 EBITDA margin Net debt/EBITDA 1,055 1,030 1,001 1,032 33% 47% 1.4x 26% 27% 24% 21% 21% 24% 32% Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Q2 '21 1. LTM 4 Note: EBITDA excluding ef
Slide 5: Forest: stable wood supply to industries
Net sales (SEKm) EBITDA (SEKm) EBITDA margin +7% +51% Stable wood supply to industries 1,592 753 47.3% 1,494 Sales up 7% 499 33.4% + Higher volumes - Lower pulpwood price Q2 2020 Q2 2021 Q2 2020 Q2 2021 Q2 2020 Q2 2021 EBITDA up 51% + Higher harvesting level of own forest Price development – Pulpwoo
Slide 6: Wood: high global demand drives price increases
Net sales (SEKm) EBITDA (SEKm) EBITDA margin 0% +339% High level of global demand drives significant 1,770 1,765 628 35.6% price increases Sales in line with Q2 2020 + Higher prices 143 8.1% - Divestment of Wood Supply UK Q2 2020 Q2 2021 Q2 2020 Q2 2021 Q2 2020 Q2 2021 EBITDA up 339% Price developme
Slide 7: Continued strong market
Stock of sawn pine and spruce wood, Sweden and Finland (k m3) Price development sawn pine and spruce, Sweden (index) 5,000 Normalized monthly level 190 Spruce 180 170 4,000 160 150 Pine 140 130 3,000 120 110 100 2,000 90 Production of sawn pine and spruce wood, Sweden and Finland (k m3) 3,500 Normal
Slide 8: Pulp: sales up 43%, EBITDA up 230%
Net sales (SEKm) EBITDA (SEKm) EBITDA margin +43% +230% Sales up 43% 1,565 600 38.3% + Higher prices 1,091 + Higher volumes 16.7% - Negative currency effects 182 EBITDA up 230% Q2 2020 Q2 2021 Q2 2020 Q2 2021 Q2 2020 Q2 2021 + Higher prices Price development – NBSK Pulp + Good production level and y
Slide 9: NBSK pulp price and inventories
NBSK pulp price (USD/t) vs deliveries (Mt) Hardwood pulp inventories (days of supply) 1,400 14.5 80 1,300 14.0 70 1,200 1,100 60 13.5 1,000 50 Average 900 13.0 40 800 NBSK PIX Price Europe 12.5 30 700 NBSK deliveries (RHS) 600 12.0 20 Jul-17 Jul-18 Jul-19 Jul-20 Jul-17 Jul-18 Jul-19 Jul-20 Jan-17 Ap
Slide 10: Containerboard: sales up 19%, EBITDA up 75%
Net sales (SEKm) EBITDA (SEKm) EBITDA margin +19% +75% Sales up 19% 1,340 411 30.7% + Higher prices 1,128 20.8% + Higher volumes 235 - Negative currency effects EBITDA up 75% Q2 2020 Q2 2021 Q2 2020 Q2 2021 Q2 2020 Q2 2021 + Higher prices Price development – Kraftliner + Good production, stable cost
Slide 11: Strong demand and prices on the rise
Price (EUR/t) vs Kraftliner deliveries (Mt) European Box demand (index) 850 6.1 122 800 5.9 119 750 5.8 116 700 113 5.6 110 650 5.5 107 600 5.3 104 Unbleached kraftliner price Euwid (LHS) 550 5.2 101 Kraftliner deliveries Europe (RHS) 500 5.0 98 Kraftliner inventories (days of supply) Strong demand
Slide 12: SCA
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Slide 13: Quarter income statement
Quarter SEKm Q2 2021 Q2 2020 Change Net sales 4,810 4,687 3% EBITDA 2,260 1,001 126% EBITDA margin 47.0% 21.3% 25.7 p.p. EBIT 1,881 600 214% EBIT margin 39.1% 12.8% 26.3 p.p. Financial items -26 -31 Profit before tax 1,855 569 226% Tax -372 -110 Profit for the period 1,483 459 223% Earnings per shar
Slide 14: Net sales and EBITDA by segment
Forest Wood Pulp Containerboard/Paper 1 2,380 2,242 Net sales (SEKm) 2,108 1,981 1,876 1,817 1,865 1,833 1,770 1,765 1,694 1,659 1,627 1,592 1,592 1,565 1,545 1,500 1,498 1,494 1,436 1,340 1,376 1,272 1,288 1,264 1,188 1,166 1,129 1,091 986 900 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q
Slide 15: Net sales bridge Q2 2020 to Q2 2021
Higher volumes mainly pulp Divestment Wood Higher prices in all Supply UK product areas Exit publication paper +7% -6% +25% -10% 6,000 -13% SEK SEK 5,000 4,687m 4,810m 4,000 3,000 2,000 +3% 1,000 0 Net sales Price/Mix Volume Currency Acquisitions/ Discontinuations Net sales Q2 2020 divestments Q2 20
Slide 16: EBITDA bridge Q2 2020 to Q2 2021
+192 -79 2,500 +5 -204 SEK +1,280 +66 2,260m 2,000 1,500 SEK 1,001m 1,000 + 126% 500 EBITDA margin EBITDA margin 21.3% 47.0% 0 EBITDA Price/Mix Volume Raw material Energy Currency Other EBITDA Q2 2020 Q2 2021 16
Slide 17: Cash flow
Quarter Jan - June SEKm Q2 2021 Q2 2020 2021 2020 EBITDA 2,260 1,001 3,619 2,031 Revaluation of biological assets and other non cash flow items -362 -233 -682 -573 Operating cash surplus 1,898 768 2,937 1,458 Change in working capital -401 -151 -691 -297 Restructuring costs -148 - -271 - Current cap
Slide 18: Capital employed and net debt
SEKm Jun 30, 2021 Dec 31, 2020 Forest assets 76,648 74,900 Working capital 3,292 2,759 Working capital/Net sales 1 17% 18% Deferred tax relating to forest assets -15,313 -14,977 Other capital employed 18,137 17,152 Total capital employed 82,764 79,834 Net debt 8,236 7,671 Net debt/EBITDA 2 1.4x 1.7x
Slide 19: Operating cash flow and net debt to EBITDA development
Operating Cash Flow and Net Debt to EBITDA development SEK 1,118m 1,106 5 957 4 3 2.0x 475 1.7x 2 1.5x 1.4x 1 0 Q3 ’20 Q4 ’20 Q1 ’21 Q2 ’21 19
Slide 20: Green bond issue, SEK 1.5bn
SEK 1.5bn 7y Senior Unsecured Green Bond maturing in June 2028 • SCA’s average debt maturity 4.8 years Aligned with SCA’s Sustainability Platform Fossil-free world | Valuable forests | Efficient use of resources Framework rated “Dark Green” with an “Excellent” governance score by CICERO Shades
Slide 21: Summary
Summary Ulf Larsson, CEO WSCA
Slide 22: Best quarter since split in 2017
Best quarter since split in 2017 – strong market with increasing prices in all segments, exit publication paper, good production and stable cost base EBITDA up 126% vs Q2 2020 + Higher prices on solid wood, pulp and kraftliner + Higher volumes + Higher production - Negative currency effects Net sale
Slide 23: Q&A
Slide 24: 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
Slide 25: Appendix
Appendix WSCA
Slide 26: Net sales and EBITDA by segment, 2014-LTM
Forest Wood Pulp Containerboard/Paper 1 Net sales (SEKm) 9,643 9,229 8,226 8,548 8,434 7,916 7,744 6,956 6,486 6,378 6,618 6,325 6,296 6,410 5,994 6,119 5,187 5,108 4,978 5,070 5,455 5,114 5,315 5,441 5,005 4,377 4,431 2,518 2,760 2,492 2,542 2,866 2014 2015 2016 2017 2018 2019 2020 LTM 2014 2015 20
Slide 27: Containerboard/Paper and Containerboard net sales and EBITDA
Containerboard/Paper 1 Containerboard Net sales (SEKm) Net sales (SEKm) 9,643 9,229 2,242 8,434 7,916 1,876 1,981 1,817 5,521 4,659 4,985 4,608 1,219 1,128 1,195 1,067 Q1 Q2 Q3 Q4 2017 2018 2019 2020 Q1 Q2 Q3 Q4 2017 2018 2019 2020 '20 '20 '20 '20 '20 '20 '20 '20 EBITDA (SEKm) and EBITDA margin 2,46