Stora Enso Oyj Financial Statement Release 2021
HELSINKI, Jan. 28, 2022 /PRNewswire/ --
Record high quarter driven by strong demand and strategic progress
Year 2021 (year-on-year)
Stora Enso's President and CEO Annica Bresky comments on the fourth quarter 2021 results:
"I'm delighted to see that our solid commercial momentum continued in the fourth quarter. Stora Enso's strong performance has been delivered through strategic progress underpinned by global megatrends. We have benefited from our strategic positioning and scale to achieve a full year operational EBIT margin of 15%, the highest in our long history. The full year operational EBIT more than doubled year-on-year to a record level of 1,528 million euro. The solid demand for our products continued and the balanced mix across all our divisions supported both price levels and volumes. We have managed global logistical disturbances and successfully implemented price increases to mitigate rising fiber, energy and other variable input costs. The organisational commitment and hard work have enabled this progress, while protecting our people and supporting our customers throughout the pandemic.
Group sales increased by 26% year-on-year to 2.7 billion euro and the operational EBIT reached 426 million euro, a year-on-year increase of 309 million euro, the highest quarterly result since early 2000s. We continued to reduce our net debt and reached a net debt to operational EBITDA of 1.1, well below our target of 2. From our areas of strategic focus, both Packaging and Wood Products, delivered record high fourth quarter results. The main driver in Packaging Materials was containerboard, which was supported by higher prices and the successful ramp-up at our Oulu site in Finland. The Wood Products division benefited from sustained, historically high price levels and a good market and product mix. We also had significant contribution from our foundation business Biomaterials, with an all-time high operational EBIT. The Forest division also delivered a record high fourth quarter result driven by the performance of our own forests. Our forest assets are now valued at 8 billion euro, a year-on-year increase of 700 million euro. Our retained paper business is now run with lower fixed costs with some of the high variable input costs from energy and Paper for Recycling (PfR) being successfully mitigated by price increases.
The general macroeconomic environment and the pandemic are persisting uncertainties. I trust in our ability to continue to be proactive and perform. For the first quarter, the tight markets seen in the second half of 2021 have continued, with us being fully booked across all divisions. When looking at this year, our outlook is that we will deliver results for the full year 2022 approximately in line with 2021 (EUR 1,528 million). To reflect the record performance in 2021, and our faith in our strategic direction, the Board proposes an increased dividend of 0.55 euro per share, up from 0.30 euro per share in 2021.
Strong momentum in strategy execution
The fourth quarter finishes off a year of strong progress in our strategic initiatives, where we have delivered on our promises to the market. The actions we have taken, our strong execution and a decentralised and more efficient operating model, are putting us in the driver's seat for further value creation for all our stakeholders.
We have for some years been transforming from being mainly a paper company to become a world leader in renewable products made from trees. Key progress has been further accelerated by lowering our exposure to the structurally declining paper business to make the retained businesses more competitive. Stora Enso is entering a new, evolution phase with the target to deliver on our profitable growth agenda. For the past two years and going forward, our strategy is focused on growth opportunities through targeted investments in Packaging, Wood Products, and Biomaterials innovations, such as Lignode. Resources and capacity have been freed up to accelerate growth in these areas. We have successfully converted one of our paper machines to board production and invested to increase capacity by debottlenecking existing board machines. We are also investing in strengthening our position as one of the largest providers of engineered wooden elements. A new CLT production site is ready to start operations in the third quarter this year. Lastly, during 2021, we started a pilot plant for Lignode, a high potential, fossil-free, anode material for batteries in electric vehicles and other electric applications.
Sustainability is the opportunity driving both our short and long-term strategy. The green revolution is a natural part of our business and we have new sustainability targets to support it. We see significant prospects for growth to expand our total addressable market and target to grow more than 5% per year over the cycle (excluding the Paper division). By investing in innovation, we further increase the gap to our competitors, enhance our competitive advantage, while at the same time helping our customers become 100% climate positive and circular. This puts us in an excellent position for long-term growth and value creation for all our stakeholders.
The renewable future grows in the forest."
All participants can follow the presentation over the webcast. Analysts and investors who wish to ask questions should join the conference call (details below).
Dial-in details for the analyst and investor conference call
The conference call replay will be available via the dial-in number until 4 February 2022. The webcast will be archived on storaenso.com/en/investors/reports-and-presentations.
This release is a summary of Stora Enso's Financial Statement Release 2021. The complete report is attached to this release as a pdf file. It is also available on the company website at storaenso.com/investors.
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Part of the global bioeconomy, Stora Enso is a leading provider of renewable products in packaging, biomaterials, wooden construction and paper, and one of the largest private forest owners in the world. We believe that everything that is made from fossil-based materials today can be made from a tree tomorrow. Stora Enso has approximately 22,000 employees and our sales in 2021 were EUR 10.2 billion. Stora Enso shares are listed on Nasdaq Helsinki Oy (STEAV, STERV) and Nasdaq Stockholm AB (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY). storaenso.com/investors
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