Slides That Follow Your Voice: Swedish Accent Earnings Call

Slide 1: Third quarter results

0:17Thank you, operator, and good morning, everyone. Welcome to the third quarter call for Norrvik Fibre. With me is our chief executive, Henrik, who will take the strategy questions, and I will take the numbers, and if a question falls between us we will look at each other for a moment, as usual. [chuckles]

0:34Let me start on page three. Net sales for the quarter were four point six two billion kronor, up five point one percent year on year, and up two point eight percent in comparable currencies. Operating profit before items affecting comparability was six hundred and, sorry, six hundred and eleven million, a margin of thirteen point two percent, against twelve point four percent a year ago.

Slide 2: Page 3: the quarter

0:58Earnings per share came in at two kronor forty-one kronor. Operating cash flow was seven hundred and two million, and net debt to E bit dah at the end of the quarter was one point six times, down from one point nine. Those are the headline numbers. There is nothing hidden behind them, as far as I know.

Slide 3: Headline numbers: 2.41 kronor per share

1:16Page five, sorry, page four, the segments. Page four, the segments. Consumer board, our largest business, grew volumes four percent, driven by the food-service contracts we signed in the spring, where we are now uh, replacing plastic cups and lids at two of the three customers I mentioned on the last call. The third is in trials, and I will not say more than that, because the last time I said more, the trial took another year. [laughs]

Slide 4: Page 4: segments

1:44I should say it was not the customer's fault. We sent the samples to the wrong address, a warehouse in the wrong country, and they sat there for eleven weeks next to some bicycles. We have since changed the label printer. Henrik is nodding. It was his label printer. He is still nodding. Okay.

2:02Pulp prices were weaker, as everyone on this call knows, and the pulp segment's margin fell to nine percent. Forestry delivered a stable three hundred and eighty million, because trees, unlike analysts, do not read the news. That segment is, as I said, stable.

2:20Page five, costs. Energy was six percent of sales, down from eight, because the Kvarnholm mill has been running the new recovery boiler at full capacity since June. Wood costs were up three percent, which is less than we guided, and I want to be careful here, because the autumn harvest came in early and that will not repeat.

Slide 5: Page 5: costs

2:40Personnel costs did not move. We have six thousand eight hundred and forty employees, sixty fewer than a year ago, almost all through retirement.

2:50Page six, the Kvarn, the Kvarnholm... Page six, the Kvarnholm investment. The new board machine is on schedule and on budget, at three point one billion kronor, with start-up still planned for the second quarter of twenty twenty-seven. We have spent one point four billion so far.

Slide 6: Page 6: the Kvarnholm board machine

3:08I know some of you are modelling a delay, because everyone always models a delay, and I would point out, gently, that the recovery boiler, which was the same contractor, started two weeks early, two weeks early.

3:24Guidance. We now expect full-year operating profit in the range of two point three to two point five billion kronor, which is the upper half of the range we gave in July. And I want to say about that range, the reason we, no, I will leave it. It is in the appendix. Ask me if you want. That range assumes pulp prices stay where they are, which is an assumption, not a forecast. Capital expenditure for the year remains at about uh, two point six billion.

Slide 7: Guidance

3:53Before we go to questions, one comment on something that is not in the slides. We received, in September, our first order for the moulded fibre tray from a customer outside Europe. It is a small order. It is eleven million kronor.

Slide 8: Not in the slides: 11 million kronor

4:08I mention it because this is a product that did not exist three years ago, that two of you on this call told me would never be competitive with plastic, and I have kept the transcripts. [sighs] I will not name them. They know. One of them has since upgraded us, which I appreciate, and the other has moved to a different bank, which I also appreciate, in a different way. [laughs]

4:32Operator, we are ready for questions, and I would ask the analysts to keep to two each, so that there is time for everyone. And for the record, since someone will ask: no change to the plan for the Kvarnholm pulp line. I said the same in July. I expect to say it in February. Some things are boring because they are working.