Stora Enso Releases Q4 and Full Year 2021 Results

Record high quarter driven by strong demand and strategic progress

Q4/2021 (year-on-year)
*Sales increased by 26.3% to EUR 2,719 (2,154) million.
*Operational EBIT increased to EUR 426 (118) million.
*Operational EBIT margin increased to 15.7% (5.5%).
*Operating profit (IFRS) increased to EUR 839 (289) million including the positive impact from the valuation of biological assets.
*EPS was EUR 0.78 (0.30) and EPS excl. fair valuations (FV) was EUR 0.32 (0.09).
*Strong cash flow from operations amounted to EUR 619 (436) million. Cash flow after investing activities was EUR 424 (223) million.
*The net debt to operational EBITDA ratio improved to 1.1 (2.3). The target is to keep the ratio below 2.0.
*Operational ROCE excluding the Forest division increased to 20.4% (4.7%), and was clearly above the long-term target of more than 13%.

Year 2021 (year-on-year)
*Sales were EUR 10,164 (8,553) million.
*Operational EBIT more than doubled to EUR 1,528 (650) million.

Key highlights
*To further expand its positioning for growth in sustainable packaging, Stora Enso invests EUR 23 million to increase capacity in containerboard at its Varkaus site in Finland. This initiative will increase the site’s capacity of 405,000 tonnes by approximately 10%.
*Stora Enso has, according to plan, ceased deliveries and production of dissolving pulp to focus on growth in other existing and new innovative pulp grades and products.
*Stora Enso will invest EUR 40 million to enhance operational and carbon footprint performance for fluff pulp production at the Skutskär site, as announced in January.
*The conversion to containerboard at the Oulu site has reached key milestones of the investment, in terms of profitability, quality and performance ahead of schedule. Therefore the ramp-up phase is considered finalised.

Stora Enso’s President and CEO Annica Bresky comments on the fourth quarter 2021 results: “I’m delighted to see that our solid commercial momentum continued in the fourth quarter. Stora Enso’s strong performance has been delivered through strategic progress underpinned by global megatrends. We have benefited from our strategic positioning and scale to achieve a full year operational EBIT margin of 15%, the highest in our long history. The full year operational EBIT more than doubled year-on-year to a record level of 1,528 million euro. The solid demand for our products continued and the balanced mix across all our divisions supported both price levels and volumes. We have managed global logistical disturbances and successfully implemented price increases to mitigate rising fiber, energy and other variable input costs. The organisational commitment and hard work have enabled this progress, while protecting our people and supporting our customers throughout the pandemic.

Group sales increased by 26% year-on-year to 2.7 billion euro and the operational EBIT reached 426 million euro, a year-on-year increase of 309 million euro, the highest quarterly result since early 2000s. We continued to reduce our net debt and reached a net debt to operational EBITDA of 1.1, well below our target of 2. From our areas of strategic focus, both Packaging and Wood Products, delivered record high fourth quarter results. The main driver in Packaging Materials was containerboard, which was supported by higher prices and the successful ramp-up at our Oulu site in Finland. The Wood Products division benefited from sustained, historically high price levels and a good market and product mix. We also had significant contribution from our foundation business Biomaterials, with an all-time high operational EBIT. The Forest division also delivered a record high fourth quarter result driven by the performance of our own forests. Our forest assets are now valued at 8 billion euro, a year-on-year increase of 700 million euro. Our retained paper business is now run with lower fixed costs with some of the high variable input costs from energy and Paper for Recycling (PfR) being successfully mitigated by price increases.
https://www.storaenso.com/en/newsroom/regulatory-and-investor-releases/2022/1/stora-enso-oyj-financial-statement-release-2021

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