Q2 2024 Svenska Cellulosa Aktiebolaget SCA Earnings Call Transcript
Key Points
- Svenska Cellulosa AB (SVCBF) reported a 15% increase in net sales, driven by higher prices and volumes.
- The company's EBITDA increased by 11% to SEK1.9 billion, with an EBITDA margin of 36%.
- The ramp-up of the new CTMP mill is progressing well, contributing to a 22% increase in sales and a 34% increase in EBITDA for the pulp segment.
- The company has completed significant strategic investments in Obbola, Ortviken, and Gothenburg, which are expected to contribute positively in the coming years.
- Svenska Cellulosa AB (SVCBF) continues to grow in leasing out land for wind power, reaching 9.7 terawatt of wind power on its land, equal to 20% of installed capacity in Sweden.
- The renewable energy segment experienced a weaker quarter with a 53% decrease in EBITDA due to lower market prices for tall oil and biofuels.
- There was an unplanned production stop at the Ostrand pulp mill, resulting in a negative impact of approximately SEK60 million in Q2, with a similar impact expected in Q3.
- The market for liquid biofuels in Europe has been negatively affected by reduced blending mandates in Sweden and increased imports from China.
- Higher raw material costs, particularly for wood, have negatively impacted several segments, including pulp and containerboard.
- The company faces continued high operational costs during the ramp-up phase of the new kraftliner machine in Obbola, with full capacity not expected until 2026.
Good morning, and welcome to this presentation of the SCA half yearly report for 2024. With me here today, I have President and CEO, Ulf Larsson; and CFO, Andreas Ewertz.
And with that, over to you, Ulf.
Thank you, Anders. Good morning also from my side, a warm welcome to the presentation of the results for the second-quarter 2024. And when I summarize the second quarter, I can state that the markets for all fiber-based products in all areas are sequentially stronger with higher prices in Q2 in comparison with Q1. We can also note that we have a delay effect in pricing for containerboard and pulp with one to two months.
In renewable energy, we have seen a negative market development in Europe for liquid biofuels, also affecting tall oil prices. So when we compare Q2 '24 with the same period last year, this is, of course, not the least due to
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