Half Year 2024 Mayr-Melnhof Karton AG Earnings Call Transcript
Key Points
- Adjusted operating profit in Q2 increased compared to last year and the previous two quarters, marking a return to positive territory for the board and paper division.
- First half year operating cash flow and free cash flow were significantly up, indicating strong financial management.
- Sales volume in the board and paper division increased by around 18% due to improved products and reduced high inventories in the supply chain.
- MM food and premium packaging achieved a strong operating margin of roughly 10% in the first half of the year, despite economic challenges.
- The company has significantly modernized its mills and upgraded its packaging businesses, enhancing product quality and competitiveness.
- First half year results were lower than the previous year due to lower average sport and paper prices.
- Average prices in the board and paper division were still substantially below last year, despite selective price increases.
- Market demand in the pharma and healthcare packaging division was restrained due to inventory reductions in the supply chain.
- The company exited some unprofitable businesses, leading to a slight decrease in sales in the pharma and healthcare division.
- Q3 results for the board and paper division are expected to be negatively impacted by annual maintenance downtime at pulp mills in Poland and Finland.
Welcome to this announcement of our '24 half year results. I am pleased that our adjusted operating profit in Q2 is up compared to last year and also compared to the previous two quarters as board and paper returned to a positive operating profit in Q2. This success is a result of the excellent execution of our profit and cash protection program even though the majority of its benefits will only be seen in full in '25.
With regards to the first half year results were still lower than in the previous year, due to lower average sport and paper prices. However, first half year operating cash flow and free cash flow were significantly up. And this is what our focus is upon.
In the board and paper division, we saw an improvement in market demand following the reduction of high inventories in the supply chain. Also, our improved products after the machine rebuilds were well received by our customers. And this resulted in a significant increase in sales volume by around 18%.
Despite
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