- Net sales increased by 3% to EUR 717 million compared with last year (700 million)
- Operating income up by 63% to EUR 54 million (33 million)
- Net income increased by 45% to EUR 28 million (19 million)
- Earnings per share increased to EUR 0.24 (0.16)
- Cash flow after capital expenditures improved to EUR -21 million (-71 million)
- All five strategic business units improved their operating income and are expected to
improve also the full-year figure.
Key figures
All comparison figures in this report have been restated in accordance with IFRS.
|
|
Q1 |
Q1 |
Q1-4 |
|
EUR million |
2004 |
2003 |
2003 |
|
|
|
|
|
|
Net sales |
717 |
700 |
2,738 |
|
Operating income |
54 |
33 |
148 |
|
Capital employed |
1,899 |
1,917 |
1,898 |
|
ROCE % |
9 |
5 |
7 |
|
EPS |
0.24 |
0.16 |
0.64 |
The Kemira Group's net sales in the January-March period of the current year were EUR 717 million, up 3% on the same period a year earlier (700 million). The increase was due largely to the acquisitions made last year. Consolidated operating income was EUR 54 million (33 million), or 8% of net sales (5%). All strategic business units increased their operating income, with the biggest improvement coming from the GrowHow operations. Income before taxes and minority interests increased by 46% to EUR 43 million (29 million) and income after taxes was up by 45% to EUR 28 million (19 million). Earnings per share were EUR 0.24 (0.16). Cash flow after capital expenditures was EUR 21 million negative (71 million negative). Per-share cash flow from operations was EUR 0.08 (0.37 negative). Equity per share was EUR 9.02 (8.77 at the start of the year).
The number of the Group's employees at the end of March was 10,642 (10,181), the increase coming mainly from the acquisitions made last year.
FULL-YEAR OUTLOOK
For pulp and paper chemicals, the low business cycle in the client industry is forecast to continue even if recently there have been some encouraging messages coming from the customer industry. Following the acquisitions made last year, the company has strengthened its geographical presence and expanded its portfolio of products and services, especially in North America. Pulp & Paper Chemicals' full-year net sales and operating income are expected to improve on the figure reported a year ago.
Demand for water treatment chemicals is expected to show further favourable development. With the rapid increase in raw material prices, profitability will be stressed, at least in the short term, until the measures to be taken to find alternative raw material sources are successful. Kemwater's net sales and operating income are nevertheless estimated to improve on last year.
The trend for industrial chemicals has been good, particularly for Kemira Fine Chemicals. Within titanium dioxide pigments and the unit's other products, sales volumes and prices were lower than a year ago. However, there are already signs that demand is starting to pick up seasonally, and that supply has been reduced now that some producers have shut down capacity. Accordingly, the second half of the year is expected to be better than the first half. Thanks to measures aiming at savings on variable and fixed costs, operating income of Industrial Chemicals is expected to come in ahead of last year's result. Also net sales are estimated to increase from last year.
Demand for paints appears relatively good, especially after last summer's weak painting season. Sales in Russia will continue to grow, with an emphasis on locally produced paints. Fixed-cost savings and synergy benefits will contribute to earnings, and both net sales and operating income are expected to improve compared with last year.
Prices of GrowHow's fertilizers are higher than during the same time last year. Grain stocks are at an exceptionally low level globally, supporting the price of grain and also having a positive effect on fertilizer prices. GrowHow's net sales and operating income are expected to improve on last year based on firm pricing and efficiency improvements.
The Kemira Group's net sales, operating income and net income are expected to improve on last year's result.
Helsinki, 4 May 2004
Board of Directors
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