Sveaskog’s Interim Report January-March 2020
Sveaskog reports an operating profit of MSEK 466 (509) for the first quarter of 2020, which is slightly lower than in the same period last year.
Hannele Arvonen, President and CEO, Sveaskog.
January – March 2020
Net sales decreased by six per cent to MSEK 1,801 (1,924). Prices of wood raw materials decreased by seven per cent on average, while total delivery volumes were largely flat. Revenue from wind power concessions has increased.
- Operating profit decreased by eight per cent to MSEK 466 (509). Lower prices were offset by higher delivery volumes from own forest while delivery volumes from externally purchased wood raw materials were slightly lower. Svenska Skogsplantor’s earnings were down due to lower volumes and higher costs.
- The reported net change in value of standing timber was MSEK 153 (113). The change in value had no impact on cash flow.
- Profit for the quarter was MSEK 515 (521), equivalent to SEK 4.35 (4.40) per share.
- So far, Sveaskog's operations have been conducted without major disruptions due to the corona pandemic.The development is closely followed in order to be able to make the necessary adjustments.
Comments from Sveaskog's President och CEO Hannele Arvonen: “A dip in earnings was expected, as prices of our products declined gradually in 2019 for market reasons, and the trend has continued into 2020. Despite the decline, we were able to sustain earnings through increased deliveries from own forest, which is satisfying.”
“Sustainable and profitable forestry relies on a dynamic forest industry and financially viable contractors. We have therefore produced a support package that will support our harvesting, forest management and transport contractors to survive the negative impact of the coronavirus pandemic.”
“In the current situation, it is especially important to ensure that our contractors receive support to secure their finances and the supply of labour. Many of the contractors depend on seasonal workers from other countries and therefore face new challenges arising from the new restrictions on cross-border travel. Our intention is to implement our planting activities in 2020 as planned to ensure regrowth in our forests.”
“The coronavirus situation is having a severe impact on the tourism and hospitality industry. To ease the situation for tourism contractors on land owned by Sveaskog, we are offering a three-month rent holiday to those who lease buildings and land from us, including youth hostels, camp sites, holiday cottages, restaurants and retailers. Sveaskog supports Swedish nature tourism and want to give these important companies the opportunity to, not only survive financially, but contribute to a vibrant rural area.”