Mercer International Inc. reports third quarter and nine months 2020 results

In light of the global market situation for graphic papers, and to sustain its competitiveness and leading position in the market, UPM Paper ENA plans to: • optimize operations at its UPM Nordland Papier and UPM NorService units in Dörpen, Germany, Europe's biggest fine paper site. Streamlining internal processes and investing in automation will enable a sustainable improvement of the fixed cost structure. • permanently close paper machine 5 at UPM Blandin in Minnesota, United States, reducing the annual capacity by approximately 128,000 tons of coated magazine paper in response to overcapacities in the North American paper market. The closure is expected to be completed by end of Q1 2018 the latest. Paper production related to paper machine 6 is planned to continue at the Blandin site. In total 223 positions are estimated to be affected by these plans in Dörpen at UPM Nordland Papier and UPM NorService. At UPM Blandin, it is estimated that 150 positions will be affected by the plans. Click Read More below for additional information.

Billerud is evaluating significant investments to transform its Escanaba mill into a world-class paperboard production facility and has applied for investment support from the State of Michigan. The Michigan House of Representatives and Senate has passed legislation approving an appropriation of up to USD 200 million in funding to support Billerud’s plans. The legislation must be approved by Michigan’s Governor, which is expected to occur within two weeks. A pre-feasibility study about Billerud’s planned conversion of the Escanaba mill to paperboard production is ongoing and planned to be completed during the first half of 2023, after which the company’s Board of Directors can make an investment decision.

Third Quarter 2020 Results: Net sales were $1.73 billion, down 1.8%. Sales were down 1.3% ex. currency, and down 3.6% on an organic basis. Reported operating margin increased 100 basis points to 12.3%. Adjusted EBITDA margin increased 190 basis points to 16.1%, while adjusted operating margin increased 140 basis points to 13.1%. Reported net income was $1.79 per share, up 5%, and adjusted net income was $1.91 per share, up 15%, both of which were above the company’s expectations, reflecting a sales decline below the low end of its outlook range in July. Year-to-date free cash flow was $342 million, up 4.4% compared to the same period last year.