Net sales for the second quarter declined by 2% to SEK 6 156 million (6 293). Higher sales volumes were primarily offset by significantly lower sales prices compared to last year in Division Paper. Net sales for the quarter were positively impacted by currency effects by 1%. Adjusted EBITDA increased to SEK 774 million (539), mainly as a result of lower maintenance costs compared with last year, lower fibre costs, reduced KM7 start-up impact and cost savings.
Stora Enso has updated its strategy and certain financial targets, to support the Group’s focus on growth and value creation. The updated strategy and financial targets will be presented in Stora Enso’s Capital Markets Day online today. The presentations will cover the Group’s three focus areas for growth, market growth drivers, the recent forest fair value change and new selective capital allocation.
“We have renewed our strategy and long-term financial targets, shaping our business for accelerated growth and value. In line with this, we continue to create value in the bioeconomy with our renewable products, solving global sustainability challenges. We focus on meeting consumer demand for eco-friendly and circular solutions and we concentrate our efforts in innovation,” says President and CEO Annica Bresky.
Stora Enso will have three focus areas for growth:
• Packaging Materials and Packaging Solutions, driven by high demand for plastic free and eco-friendly circular packaging. We hold leading market positions and see attractive investment options.
• Building Solutions, within our Wood Products division, driven by a growing wooden buildings market. We offer alternatives to fossil-based construction material and are a leading global supplier.
• Biomaterials innovation, where our agenda is focused on lignin, and targets strong growth in new applications and markets.
At the foundation for value creation, and supporting our growth areas:
• Our substantial forest assets, securing a renewable, cost-competitive fiber base.
• Our sawmills in the Wood Products division, providing fiber to our pulp mills and serving as a base for growth in Building Solutions.
• Our pulp mills, supporting our board and paper manufacturing and providing strong cash flow, with highly competitive eucalyptus pulp production facilities in Latin America and specialty pulp mills in the Nordics.
Paper will continue to be run in order to maximise cash flow in the declining market.
“To sum up, we focus on leading positions and accelerated growth in packaging, building solutions and our biomaterials innovation programme. Our innovation initiatives will be concentrated in the areas of new sustainable packaging materials, sustainable barriers and our biochemical platform in lignin. Our forest, traditional wood products and market pulp make up the foundation for value creation in our company,” Annica Bresky concludes.
Capital expenditure for 2021
Stora Enso’s capital expenditure is expected to be in the range of EUR 675–725 million in 2021. The Group will be allocating capital expenditure selectively to the above-mentioned focus areas for growth. The annual depreciation and depletion of capitalised silviculture costs is forecast to be EUR 600–640 million.
Stora Enso’s long-term financial targets
Stora Enso has revised its long-term financial targets. There are new Group level targets for growth and return on capital employed (ROCE). The divisional targets for Packaging Solutions and Forest will also change. Also, dividend policy is updated to distribute 50% of EPS excluding fair valuation over the cycle. Other targets remain unchanged.