In 3Q2019, the net sales of Coated Woodfree were €143 million vs €180 million in 3Q2018, a decrease of €37 million or -20%. The Ebitda at €4 million was lower than in 3Q2018 (€8 million). This decrease was mainly due to a reduction in sales volume and an increase in distribution costs, partly offset by an increase of net sales price and reductions in variable production costs and fixed expenses. In 3Q2019, the net sales of Specialties were €114 million vs €122 million in 3Q2018, a decrease of €8 million or -7%. The Ebitda at €8 million was lower than in 3Q2018 (€17 million). This decrease was mainly due to reductions in sales volume and net sales price, an increase in variable production costs, partly offset by decreases in distribution costs and fixed expenses. For the third quarter ended 30 September 2019, Lecta had revenue of €316.5 million versus €366.7 million in the third quarter ended 30 September 2018, a decrease of €50.1 million or -13.7%. EBITDA decreased by €12.3 million, or -47%, from €26.2 million in 3Q2018 to €13.9 million in 3Q2019. This decrease was the result of lower sales of paper in volume, higher outsourcing, and overhead costs, partly offset by lower net energy cost, costs of packaging, distribution, selling variable, labor, maintenance, and production consumables, in a context of higher unit gross margin.
UPM announced today the official inauguration of the Paper Machine 3 (PM3) in Changshu, China. As an important milestone for the development of UPM in China, the new paper machine will further increase production capacity while implementing the Biofore strategy. With this investment UPM will continue to provide environmentally friendly, safe and broad product portfolios for customers in China and the Asia-Pacific region.
“In UPM Changshu we will focus on value added, advanced paper products for growing segments in China and worldwide. On this site, we are also introducing totally new, innovative manufacturing technology – not only for China, but for the paper industry worldwide,” said President and CEO Jussi Pesonen in his opening speech.
In 2012, in order to meet the growing demand for paper from China and the Asia-Pacific region, UPM began to implement the PM3 Project with a total cost of EUR 277 million. The PM3 production line and process has been designed to be very flexible with a wide range of different products from uncoated woodfree papers to advanced specialty products. This swing concept of PM3 also greatly improves the efficiency of paper production and also helps to reduce energy consumption. The product portfolio of Changshu has been extended into labelling material and other specialty products to better fit customer needs. These segments are still seeing and are forecasted to see significant growth globally, but especially in this part of the world.
UPM first invested in China in 1998 and has since invested more than USD 2 billion in the region. The Changshu site is a proof of UPM’s consistent and steady commitment in China. Today, the site boasts a fully integrated production and converting capability that incorporates a paper mill, labelstock factory, Asia R&D Centre as well as an APAC Supply Chain Centre. With the new investment, UPM is able to produce 1.4 million tonnes of labelling material and fine papers for customers across the Asia Pacific region, and beyond.
UPM attaches great importance to the sustainable development of the economy, society and environment. UPM’s Biofore strategy emphasizes environmental friendliness and sustainable development for the full life cycle of paper production. Currently the share of certified fibres is at 84 per cent. In addition, UPM has developed a biodiversity program for forest management, to increase biodiversity, improve natural ecosystems, carbon cycles, and vitalize the forest. In the paper production process, UPM values the protection and recycling of water resources. At UPM’s Changshu Mill, the recycling rate for the white water has reached 97 per cent.
“The completion of PM3 Project in Changshu is another strong example of our long-term commitment to sustainable development in Chinese market. In the future, through UPM’s Biofore strategy, the company will continue to raise industry standards to achieve a more sustainable and safer way of production,” said Jussi Pesonen.