HELSINKI, Finland, Oct. 27, 2005 (PRIMEZONE) -- Stora Enso Oyj Third Quarter Results (compared with previous quarter).
Stora Enso (NYSE:SEO) today announced that Stora Enso's earnings per share were EUR 0.08 (EUR 0.00) excluding non-recurring items. Operating profit excluding non-recurring items was EUR 106.2 (EUR 17.7) million. Profit before tax amounted to EUR 93.0 (EUR 0.1) million excluding non-recurring items. There were no non-recurring items in the third quarter.
Sales at EUR 3 219.2 million were 1.0% or EUR 31.9 million higher than the previous quarter's EUR 3 187.3 million. Cash flow from ongoing operations was EUR 351.2 (EUR 387.9) million and cash flow after investing activities excluding acquisitions EUR 94.9 (EUR 130.6) million. Cash earnings per share were EUR 0.44 (EUR 0.35) excluding non-recurring items. Net financial items were EUR -25.0 (EUR -34.6) million.
EUR million
2003 2004 Q1-Q3/04 Q1-Q3/05 Q3/04 Q2/05 Q3/05
Sales 12 12
172.3 395.8 9 153.9 9 551.4 3 033.1 3 187.3 3 219.2
EBITDA
1)2) 1 707.7 1 510.9 1 179.7 1 075.8 425.8 298.4 388.6
Operating
profit
2) 522.9 338.9 297.5 236.6 139.1 17.7 106.2
Non-recurring
items -54.4 369.7 189.8 -12.0 74.1 -12.0 -
Operating
margin
2), % 4.3 2.7 3.2 2.5 4.6 0.6 3.3
Operating
profit 468.5 708.6 487.3 224.6 213.2 5.7 106.2
Profit before tax
and minority
interests
2) 316.3 271.8 248.6 176.7 122.3 0.1 93.0
Profit before tax
and minority
interests 207.8 641.5 438.4 164.7 196.4 -11.9 93.0
Net profit for the
period 136.0 740.8 591.7 114.9 136.1 -10.1 66.4
EPS 2), Basic,
EUR 0.24 0.26 0.23 0.15 0.11 0.00 0.08
EPS, Basic,
EUR 0.16 0.89 0.71 0.14 0.16 -0.01 0.08
CEPS 2) 3),
EUR 1.63 1.67 1.29 1.20 0.46 0.35 0.44
ROCE 2),
% 4.5 3.0 3.5 2.8 5.1 0.6 3.7
1) EBITDA = Earnings before Interest, Taxes, Depreciation and Amortisation
2) Excluding net non-recurring items. Exceptional transactions that are not related to normal business operations are accounted for as non-recurring items. The most common non-recurring items are capital gains, additional write-downs, restructuring provisions and penalties. Non-recurring items are normally specified individually if they exceed one cent per share.
3) CEPS = (Net profit for the period + depreciation and amortisation)/average number of shares
Short-term Outlook
Commenting on the outlook, Stora Enso's CEO Jukka Harmala said, "In Europe demand for advertising-driven paper grades is expected to improve, thereby increasing demand for publication papers. Prices should remain stable in these grades for the rest of the year, but are expected to improve early next year. Seasonal strengthening in demand for fine paper is anticipated leading to moderate price rises in uncoated fine paper; further increases are expected in the beginning of next year. Packaging board demand should be stable, allowing prices for some grades to increase. Markets for wood products are likely to remain balanced with stable prices."
In North America magazine paper demand is expected to remain firm, but demand for newsprint is weakening. Price increases have been announced for publication paper grades. A seasonal rise in demand for coated fine paper should result in some price increases.
In Asia fine paper demand is predicted to be rather sluggish and further price erosion is anticipated.
Operating profit excluding non-recurring items is expected to be higher in the fourth quarter than the third quarter despite higher maintenance costs. Following the new Finnish labour agreement, capacity can be utilised during the whole year, allowing maintenance stoppages to be optimised.
The Group has estimated that the provisions and write-downs in the fourth quarter of 2005 related to the anticipated closures may be approximately EUR 300 million of which about EUR 50 million would have a cash impact. A release of EUR 30 million of net working capital of is also expected.
Stora Enso's results for 2005 will be published on 2 February 2006.
The full-length version of the Stora Enso interim review is available on the Stora Enso website at http://www.storaenso.com/investors or from the following link: http://hugin.info/3034/R/1018255/159830.pdf
It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding expectations for market growth and developments; expectations for growth and profitability; and statements preceded by "believes"," expects", "anticipates", "foresees", or similar expressions, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Since these statements are based on current plans, estimates and projections, they involve risks and uncertainties, which may cause actual results to materially differ from those expressed in such forward-looking statements. Such factors include, but are not limited to: (1)operating factors such as continued success of manufacturing activities and the achievement of efficiencies therein, continued success of product development, acceptance of new products or services by the Group's targeted customers, success of the existing and future collaboration arrangements, changes in business strategy or development plans or targets, changes in the degree of protection created by the Group's patents and other intellectual property rights, the availability of capital on acceptable terms; (2) industry conditions, such as strength of product demand, intensity of competition, prevailing and future global market prices for the Group's products and the pricing pressures thereto, price fluctuations in raw materials, financial condition of the customers and the competitors of the Group, the potential introduction of competing products and technologies by competitors; and (3) general economic conditions, such as rates of economic growth in the Group's principal geographic markets or fluctuations in exchange and interest rates.
Stora Enso is an integrated paper, packaging and forest products company producing publication and fine papers, packaging boards and wood products, areas in which the Group is a global market leader. Stora Enso sales totaled EUR 12.4 billion in 2004. The Group has some 45 000 employees in more than 40 countries in five continents and an annual production capacity of 16.4 million tones of paper and board and 7.7 million cubic metres of sawn wood products, including3.2 million cubic metres of value-added products. Stora Enso's shareware listed in Helsinki, Stockholm and New York.
Stora Enso Oyj Business ID 1039050-8