Sappi Ltd S/Adr (SPPJY) Q2 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

Thank you, and good day, everybody. Thanks for joining us. As always, as I move through the investor presentation, I'll call out page numbers. Just starting on page two, just refer you to the forward-looking statements disclosure, if you can take a read of that. And then moving to page three, The second quarter in context, it's fair to say we did see a deterioration in the market conditions across all segments from where we were obviously three months ago. We did know that the earnings were going to be lessened and certainly we guided that way because we had material shuts in the quarter. Firstly, we had the shut for the Somerset project. which had about a $20 million impact, which was as expected. And then we had two big maintenance shuts at our two big South African mills, Sycor and then Gdwana. Those took longer than anticipated. We did pick up some issues during the shut. And overall, that had an impact of an additional 13 million tons. Broadly speaking, that is the main reason for the the differential to the guidance that we provided. Having said that, as I said earlier, the market conditions did deteriorate. We saw our selling prices across all the segments coming under some pressure, and obviously that picked up momentum as we got to the end of the quarter, particularly in anticipation of the announcements of the tariffs in the US by President Trump. we certainly saw a slowdown as it progressed. Overall, the actual sales volumes themselves were actually reasonably stable. And I'm pleased to say that we did see volumes in the packaging segment higher than they were previously. But obviously, the impact on shots is that you have lower production And you have higher fixed cost absorption and obviously lower inventories at the end of the quarter. Moving to slide f...