Sappi Ltd S/Adr (SPPJY) Q2 2026 Earnings Call

Investor webinar replay

Replay transcript excerpt

you compare the market prices quarter on quarter, you can see that they were down about $100 a ton compared to the last quarter. And that has a big impact on profitability. So all in all, very pleased with the ramp up. The volumes are going well, but market prices in the short term under a little bit of pressure. Side six is our earnings bridge from a year ago to now, and it's the same themes that come through. Big impact on selling prices, negative. We've done a lot of great work on taking costs out of the business, which offset some of that, but clearly not all. And then the currency, when we compared the currency conversion, that was a negative as well, which ultimately led to the 52 million EBITDA that you saw compared to what was there in the prior year. Moving to slide seven, cost inflation, which is obviously another big driver. And in the quarter that we just reported, we did see a rise in a number of our key costs. Even before the Iran war started, things were starting to increase, but that was exacerbated when the war broke out. It's had an impact on the quarter, but we thought it would be useful just to share with you what it meant for the quarter ahead. You can see that there are some significant rises. The one we're most concerned about is the delivery cost, because that's a big number. We all know that fuel prices, oil prices rising, shipping costs are rising as well. And that's got a vast impact. But also a number of our raw materials that we're using in our mills, and we list three there, three big ones, sulfur, caustic, and latex. And with the constraints on shipping globally and what's happening in the Hormuz Strait, a lot of that product, particularly sulfur, is not really flowing. And there's a bit of a scramble to get your hands on these products...