UPM Interim Report Q3 2021: UPM delivers a record quarter in an
exceptionally volatile global environment
UPM-Kymmene
Corporation Stock
Exchange Release (Interim Report) 26 October 2021 at 09:45 EEST
UPM Interim Report Q3 2021:UPM delivers
a record quarter in an exceptionally volatile global
environment
Q3 2021 highlights
- Sales increased by 24% to EUR 2,523
million (2,028 million in Q3 2020)
- Comparable EBIT increased by 98% to
EUR 424 million, 16.8% of sales (215 million, 10.6%)
- Operating cash flow was EUR 318
million (365 million)
- Demand for UPM’s products was good,
and overall, price increases more than offset the rapid rise in
input costs
- UPM completed the sale of the UPM
Shotton newsprint mill in the UK
- The global sustainability ratings
provider EcoVadis recognised UPM on the highest possible Platinum
level for its responsible performance in 2021
- UPM was recognised as one of the
world’s 37 most sustainable companies by the UN Global Compact
Q1–Q3 2021 highlights
- Sales increased by 12% to EUR 7,141
million (6,392 million in Q1–Q3 2020)
- Comparable EBIT increased by 45% to
EUR 1,010 million (697 million), and was 14.1% (10.9%) of
sales
- Operating cash flow was EUR 844
million (659 million)
- UPM's transformative growth
projects made good progress
- Net debt increased to EUR 667
million (89 million) and net debt to EBITDA ratio was 0.38
(0.06)
- Cash funds and unused committed
credit facilities totalled EUR 2.5 billion at the end of
September
- UPM started the basic engineering
phase of a next-generation biofuels refinery in January
- UPM joined The Climate Pledge in
February, committed to reach the targets of the Paris Agreement 10
years in advance
Key figures
|
Q3/2021 |
Q3/2020 |
Q2/2021 |
Q1–Q3/2021 |
Q1–Q3/2020 |
Q1–Q4/2020 |
Sales,
EURm |
2,523 |
|
2,028 |
|
2,384 |
|
7,141 |
|
6,392 |
|
8,580 |
|
Comparable
EBITDA, EURm |
535 |
|
331 |
|
426 |
|
1,351 |
|
1,050 |
|
1,442 |
|
% of sales |
21.2 |
|
16.3 |
|
17.9 |
|
18.9 |
|
16.4 |
|
16.8 |
|
Operating profit, EURm |
564 |
|
117 |
|
304 |
|
1,147 |
|
508 |
|
761 |
|
Comparable
EBIT, EURm |
424 |
|
215 |
|
307 |
|
1,010 |
|
697 |
|
948 |
|
% of sales |
16.8 |
|
10.6 |
|
12.9 |
|
14.1 |
|
10.9 |
|
11.1 |
|
Profit before tax, EURm |
558 |
|
109 |
|
298 |
|
1,128 |
|
487 |
|
737 |
|
Comparable profit before tax, EURm |
418 |
|
207 |
|
301 |
|
991 |
|
676 |
|
924 |
|
Profit for the period, EURm |
497 |
|
83 |
|
243 |
|
968 |
|
378 |
|
568 |
|
Comparable profit for the period, EURm |
359 |
|
158 |
|
246 |
|
832 |
|
546 |
|
737 |
|
Earnings per share (EPS), EUR |
0.92 |
|
0.15 |
|
0.45 |
|
1.78 |
|
0.70 |
|
1.05 |
|
Comparable EPS, EUR |
0.66 |
|
0.29 |
|
0.45 |
|
1.53 |
|
1.01 |
|
1.37 |
|
Return on equity (ROE), % |
19.9 |
|
3.5 |
|
10.3 |
|
12.9 |
|
5.1 |
|
5.8 |
|
Comparable ROE, % |
14.3 |
|
6.7 |
|
10.4 |
|
11.1 |
|
7.4 |
|
7.5 |
|
Return on capital employed (ROCE), % |
17.9 |
|
4.3 |
|
10.1 |
|
12.5 |
|
6.2 |
|
6.7 |
|
Comparable ROCE, % |
13.4 |
|
7.9 |
|
10.2 |
|
11.0 |
|
8.5 |
|
8.3 |
|
Operating cash flow, EURm |
318 |
|
365 |
|
308 |
|
844 |
|
659 |
|
1,005 |
|
Operating cash flow per share, EUR |
0.60 |
|
0.69 |
|
0.58 |
|
1.58 |
|
1.23 |
|
1.89 |
|
Equity per share at the end of period, EUR |
19.08 |
|
17.54 |
|
17.62 |
|
19.08 |
|
17.54 |
|
17.53 |
|
Capital
employed at the end of period, EURm |
13,039 |
|
10,721 |
|
12,226 |
|
13,039 |
|
10,721 |
|
11,555 |
|
Net debt at
the end of period, EURm |
667 |
|
89 |
|
750 |
|
667 |
|
89 |
|
56 |
|
Net debt to
EBITDA (last 12 months) |
0.38 |
|
0.06 |
|
0.49 |
|
0.38 |
|
0.06 |
|
0.04 |
|
Personnel at the end of period |
17,085 |
|
18,349 |
|
17,874 |
|
17,085 |
|
18,349 |
|
18,014 |
|
Jussi Pesonen, President and CEO, comments on the Q3
results:
“The third quarter of the year was the best-ever quarter for
UPM. At the same time, we have been able to make good progress with
our transformative investments. These achievements are remarkable
in an exceptionally volatile and uncertain global business
environment, and I want to thank all UPMers for the resilience and
determination they have shown.
The demand for our products was good, particularly in Europe and
North America, and sales prices increased in all our businesses.
However, variable costs rose rapidly across the board as well. Most
notably the energy markets have changed dramatically in a short
period of time. Our operational efficiency was excellent despite
the challenges in logistics and global supply chains.
Q3 sales increased by 24% to EUR 2,523 million. Comparable EBIT
was up by 98% rising to EUR 424 million from the lockdown affected
Q3 of last year. Comparable EBIT margin reached 16.8%. Operating
cash flow was EUR 318 million and our financial position remains
very strong. Net debt at the end of September was EUR 667 million,
0.38 times EBITDA, and our cash funds and unused committed credit
facilities totalled EUR 2.5 billion.
UPM Biorefining reached record quarterly earnings thanks to
significantly higher pulp and timber sales prices and excellent
operational efficiency. The pulp market continued to be strong in
Europe but softened in Asia. Demand for advanced renewable diesel
and naphtha was also strong, and our Lappeenranta biorefinery
restarted production in early August after the fire related
repairs.
UPM Raflatac continued to be one of our star performers. Demand
growth was consistently strong across most markets and end-uses.
Input costs rose rapidly during the quarter but were mitigated by
successful margin management.
The market situation for UPM Specialty Papers was twofold. On
the one hand, demand for release, label and packaging papers
remained strong in all markets and sales prices increased
significantly. On the other hand, fine paper demand in Asia slowed
down and prices decreased. High input costs and the exceptional
energy market situation in China affected the results.
Despite good market demand in Europe and the implementation of
price increases, UPM Communication Papers was loss-making in the
quarter. On top of the anticipated cost increases in pulp, recycled
fibre and logistics, the emerging energy crisis in Europe resulted
in unforeseen cost increases despite hedging. The sale of UPM
Shotton newsprint mill was concluded at the end of the quarter.
UPM Energy delivered excellent earnings. The business benefitted
from significantly higher electricity sales prices and it
successfully implemented optimisation and value creation measures
for the volatile markets.
UPM Plywood also achieved record quarterly earnings. Market
demand for both spruce and birch plywood continues to be strong and
price increases have been successful. The business also made good
progress in operational efficiency, reaching higher production
volume than a year ago.
In Uruguay, we have now reached peak activity with more than
6,000 workers on our construction sites. The investment project is
progressing intensively in all main areas. In Leuna, Germany, our
biochemicals investment is making progress both at the construction
site and in business preparation. The pandemic and global logistics
bottlenecks pose challenges to large projects, and we continue
implementing mitigating actions to ensure timely progress.
The commercialisation of the next generation biochemicals is
taking significant steps forward. We are especially excited about
our cooperation with Coca-Cola Company. UPM’s bioMEG from the Leuna
biorefinery will enable wood-based, recyclable PET bottles. In
addition, we launched UPM BioMotion™ renewable functional fillers
to significantly reduce CO₂ footprint and weight of rubber and
plastics applications in a variety of end-uses.
On the eve of UN climate change conference COP26, we underline
the importance of renewable solutions. Undisputedly the most
effective way to mitigate climate change is reducing the use of
fossil-based raw materials and energy radically. UPM offers
alternatives to fossil-based materials and creates a future beyond
fossils, enabling our customers and consumers to make sustainable
choices. Our climate action is based on significant emissions
reductions, managing forests sustainably and innovating
climate-positive products. These actions support the UN Business
Ambition for 1.5 degrees to which we are committed.”
Outlook for 2021
The global economy has started recovering in 2021 from the deep
downturn experienced in 2020. World regions will progress at
different pace. China has led this development but has recently
slowed down to some extent. Demand for most UPM products is
influenced by overall economic activity and hence, depends on the
shape and rate of the economic recovery.
The COVID-19 pandemic continues to cause uncertainty in 2021. In
2020, lockdowns had a significant negative impact on graphic paper
demand but supported the strong demand for self-adhesive labelling
materials and specialty papers. Opening of the economies is likely
to allow for some normalisation of these demand impacts.
Sales prices for many UPM products are expected to increase in
H2 2021 from H1 2021, including graphic paper prices in Europe.
Pulp sales prices increased rapidly in H1 2021 and are expected to
be higher on average in H2 2021 than in H1 2021.
With improving global economy, many variable cost items are
expected to increase in 2021. During H2 2021 the tight energy
market situation is expected to cause increased costs both directly
and indirectly. UPM will continue to manage margins with product
pricing, optimising its product and market mix, efficient use of
assets as well as by taking measures to improve variable and fixed
cost efficiency.
UPM’s comparable EBIT is expected to increase both in H2 2021
compared with H1 2021 and increase clearly in the full year 2021
compared with 2020.
Invitation to UPM’s webcast and press conference
on Q3 2021
interim report
A webcast and a conference call for analysts and investors in
English language begins at 13:15 EEST. UPM’s financial results will
be presented by the President and CEO Jussi
Pesonen and CFO Tapio Korpeinen. All
participants can view the webcast online at www.upm.com or through
this link, but participants who wish to ask questions must attend
the conference call by dialling a number in the list below:
Conference call title: UPM Interim Report for January–September
2021International telephone numbers:
Argentina Toll: +54 1152526536Australia Toll: +61
284058549Austria Toll: +43 19287907Bahrain Toll: +973
16199100Belgium Toll: +32 24035814Brazil Toll: +55
1133517266Bulgaria Toll: +359 29358129Canada Toll: +1
4162164189Chile Toll: +56 226188227China Toll: +86
4008983300Croatia Toll: +385 20770084Cyprus Toll: +357
26030115Czech Republic Toll: +420 225439714Denmark Toll: +45
35445577Estonia Toll: +372 6868838Finland Toll: +358981710310France
Toll: +33 170750711Germany Toll: +49 6913803430Greece Toll: +30
2112111509Hong Kong Toll: +852 30600225Hungary Toll: +36
12355213India Toll: +91 2271279610Indonesia Toll: +62
2129704955Ireland Toll: +353 14311252Israel Toll: +972
37207679Italy Toll: +39 0236013821Japan Toll: +81 344556492Korea :
+82 234798456Latvia Toll: +371 67852162Lithuania Toll: +370
52051171Luxembourg Toll: +352 27300160Malaysia Toll: +60
320531815Morocco Toll: 212520480069Netherlands Toll: +31
207095189New Zealand Toll: +64 93670511Norway Toll: +47
23500243Philippines Toll: +63 23953391Poland Toll: +48
225839017Portugal Toll: +351 210609105Saudi Arabia Toll: +966
115108758Singapore Toll: +65 64298349Slovakia Toll: +421
250112045Slovenia Toll: +386 18888475South Africa Toll: +27
216724118Spain Toll: +34 935472900Sweden Toll: +46
856642651Switzerland Toll: +41 225809034Taiwan Toll: +886
287231159Turkey Toll: +90 2123755124Ukraine Toll: +380
893239875United Kingdom Toll: +44 3333000804United States Toll: +1
6319131422Venezuela Toll: +58 2123358975
PIN code: 16781203#
We recommend that participants dial in 5-10 minutes prior to
ensure a timely start of the webcast. The webcast will be available
at www.upm.com for 12 months after the call.
Later in the afternoon, at 14:45 EEST, CEO Jussi Pesonen will
present the Q3 results in a press conference held in the Finnish
language both at the Biofore House and online. Due to the Covid-19
pandemic, participation to the Biofore House event is restricted to
members of the media only. Others are asked to follow the
presentation online. To register to the live or online event, visit
this link. Only the registered will receive the link to the online
press conference.
*
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. 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 including the availability and
cost of production inputs, 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, 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. The main earnings
sensitivities and the group’s cost structure are presented on pages
160–161 of the Annual Report 2020. Risks and opportunities are
discussed on pages 36–37, and risks and risk management are
presented on pages 129–133.
*
UPM-Kymmene CorporationPirkko HarrelaExecutive Vice President,
Stakeholder Relations
UPM, Media Relations Mon-Fri 9:00-16:00 EETtel.
+358 40 588 3284 media@upm.com
UPMWe deliver renewable and responsible
solutions and innovate for a future beyond fossils across six
business areas: UPM Biorefining, UPM Energy, UPM Raflatac, UPM
Specialty Papers, UPM Communication Papers and UPM Plywood. As the
industry leader in responsibility we are committed to the UN
Business Ambition for 1.5°C and the science-based targets to
mitigate climate change. We employ 18,000 people worldwide and our
annual sales are approximately EUR 8.6 billion. Our shares are
listed on Nasdaq Helsinki Ltd. UPM Biofore – Beyond
fossils. www.upm.com
Follow UPM
on Twitter | LinkedIn | Facebook | YouTube | Instagram |
#UPM #biofore #beyondfossils
- UPM-Interim-Report-Q3-2021-en
UPM Kymmene Oyj (TG:RPL)
Gráfico Histórico do Ativo
De Mar 2024 até Abr 2024
UPM Kymmene Oyj (TG:RPL)
Gráfico Histórico do Ativo
De Abr 2023 até Abr 2024