Nordic Paper (NPAPER) Q3 2024 earnings summary

Executive summary

• Net sales reached a record SEK 1,100m in Q3, up 2% year-over-year, with a 4% increase excluding currency effects and stable sales volumes.

• EBITDA was SEK 106m, nearly unchanged from SEK 108m in Q3 2023, with a margin of 9.6%.

• Sales prices increased by 3% compared to Q3 2023.

• Demand remained strong for specialty paper products, but signs of softening appeared late in the quarter.

• A public takeover offer was announced, with the board recommending shareholders not accept; no operational impact reported.

Financial highlights

• Net sales for Jan–Sep 2024 were SEK 3,534m, up 1% year-over-year.

• EBITDA for Q3 was SEK 106m (margin 9.6%), and for Jan–Sep was SEK 616m (margin 17.4%).

• Net debt/EBITDA increased to 1.4, up from 0.9 last year, mainly due to Bäckhammar investments.

• Cash flow from operating activities in Q3 was SEK 195m, down from SEK 301m last year.

• Investments in non-current assets in Q3 were SEK 112m, mainly for Bäckhammar projects.

Outlook and guidance

• Demand is expected to weaken in Q4, especially in the Kraft Paper segment.

• Average sales prices are projected to remain unchanged in Q4 compared to Q3.

• Marginal impact anticipated from changes in pulp and pulpwood prices.

• Q4 Kraft Paper sales volumes will be negatively affected by maintenance stop and delayed restart at Bäckhammar.

• Bäckhammar investments are on track, expected to deliver SEK 100m annual EBITDA gain after completion.