Norske Skog's gross operating earnings (EBITDA) in the third quarter of 2015 were NOK 163 million, up from 138 million in the second quarter. The EBITDA improved from second quarter due to foreign exchange effects but was somewhat offset by lower sales prices with challenging export markets in Australasia. The weakening of Norwegian krone was the main reason for the NOK 0.9 billion non-cash increase in the net interest bearing debt in the quarter. The net loss of NOK 742 million in the third quarter of 2015 was significantly impacted by negative unrealised foreign exchange losses amounting to NOK 525 million on foreign denominated debt due to a significant depreciation of NOK. Net interest-bearing debt increased by NOK 0.9 billion from the end of second quarter 2015, from NOK 7.5 billion to NOK 8.4 billion, mainly due to unfavourable foreign exchange effects. Cash flow from operating activities before net financial items was NOK 2 million (NOK 89 million in Q2 2015). The working capital increased by NOK 134 million in the third quarter due to higher sales at Saugbrugs.
Following a period of downward price pressure last year, the softwood pulp market stabilized in early 2016 and the outlook is now improving. As a result, a number of global price initiatives have already been announced.
“We know from experience that the spring is typically characterized by stronger demand than the start of the year, and that this is also a time for maintenance stoppages in Europe. That’s why we anticipate that the market will tighten even further”, said Magnus Björkman, President of Södra Cell International.In the expectation of a stronger global market and solid demand, Södra will increase its market price for NBSK deliveries in Europe to USD 810/tonne, effective from April 1st 2016.