German papermaker Feldmuehle is switching fuel from gas to light heating oil at short notice due to the gas supply crisis, while paper federation Cepi has warned about possible disruption to paper and packaging supplies if mandatory consumption cuts are enforced in the EU. Feldmuehle said it was taking rapid action to switch to light heating oil as fuel for steam generation at its Uetersen mill, which makes paper for labels and packaging. CEPI said that the pulp and paper industry had a fundamental role as a provider of critical products, and called on member states to consider entire value chains when responding to the crisis. “As its manufacturing partly depends on gas, possible disruptions in the industry’s gas supply would affect the entire logistics of the EU, availability of paper packaging for food and pharmaceuticals, as well as essential hygiene products,” CEPI stated.
Commenting on the group’s results, Sappi Chief Executive Officer, Steve Binnie, said: “I am very pleased with Sappi’s strong recovery and our return to profitability for the year. I wish to recognise the dedication and resilience of the Sappi team in turning a loss of US$135 million in 2020 into a profit of US$13 million for 2021, with EBITDA increasing by 40% over the prior year. The team overcame significant challenges posed by COVID-19. The cooperation, crossregional support and continued focus on our Thrive25 strategy were exemplary.
“Highlights for the year included the recovery in the profitability of the dissolving pulp (DP) segment driven by buoyant demand and significantly better market prices as well as the North American region delivering its highest financial year EBITDA in over a decade. Our strategy of making investments in packaging and speciality papers reaped the rewards as the segment achieved record profitability and sales volumes increased by 21%.”
Financial summary for the quarter and full year
• EBITDA excluding special items
o For the quarter US$177 million (Q4 FY20 US$82 million)
o For the year US$532 million (FY20 US$378 million)
• Profit for the period
o For the quarter US$35 million (Q4 FY20 loss of US$88 million)
o For the year US$13 million (FY20 loss of US$135 million)