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Rottneros year-end report January - December 2019

2020-02-06, 08:00
 - Regulatory
Declining prices affected the result, production continues to grow

The NBSK pulp market price continued to decline during the fourth quarter of 2019 and was 33% lower in USD and 28% lower in SEK compared to fourth quarter 2018.

Net turnover decreased by 6 % to 547 (580) MSEK. The negative price trend was offset by higher delivery volumes 103,2 (94,3) thousand tons.

The annual maintenance shutdown at Vallvik Mill was held in October and has a negative effect on fixed costs and production volume compared to a normal quarter.

Profit after financial items for the fourth quarter was -36 (7) MSEK. Earnings per share for the quarter was -0,19 (0,06) SEK.

The producion volume for the quarter was good despite the maintenance shutdown and reached 100,4 (93,6) thousand tons. The Group sets a new annual production record, 406,0 thousand tons. The previous record was 401,2 thousand tons in 2017.

Raw material sourcing is strengthened through the acquisition of Nykvist Skogs AB.

Very strong cash flow from operating activities, 462 (223) MSEK for the full year.

Dividend: An extra dividend of 0,70 SEK/share was paid out during the fourth quarter. For 2019 the Board proposes an ordinary dividend of 0,40 SEK/share and an extra dividend of 0,20 SEK/share. This corresponds to 47 % of net profit.

Comments from the CEO

The pulp market continues to be characterized by uncertainty and low but relatively stable prices. The weak market situation together with the normal maintenance shutdown in Vallvik resulted in a negative EBIT for Q4. At the same time, the factors that we can control internally developed according to plan, mainly production, deliveries and fixed costs. Overall, 2019 was a positive year for Rottneros despite the gradually deteriorating market conditions during the year.

In 2019, the global pulp market deteriorated dramatically resulting in continuous price reductions. The background was primarily a lower consumption growth due to the slowdown in the world economy. This includes China, which was affected by increased trade barriers. Also, the pulp supply increased due to high capacity utilization worldwide and additional production volumes from several Nordic players. Towards the end of the year the market balance improved and stock levels dropped. This has stabilized the price trend since October, albeit at a low level. The gross price for NBSK fell during the quarter from approximately USD 850 at the beginning to USD 820 at the end. The long-term trend of an annual consumption increase of 1–2 per cent is expected to continue. The fact that there are no major capacity increases projected in the next few years is also a positive factor further down the road.


We follow the long-term plan and gradually increase production through increased availability in the mills. This is primarily driven by continuous improvements in our processes and routines. During the quarter, production increased by 7 per cent compared to Q4 last year and amounted to 100 thousand tons. Sales volume increased 10 per cent to just over 103 thousand tons. However, EBIT for the quarter declined to -30 MSEK, mainly due to the lower pulp prices and the maintenance stop in Vallvik Mill. At the same time, the weaker SEK and high level of deliveries contributed positively. The annual maintenance shutdown in Vallvik went according to plan with a negative impact on volume and earnings in line with our expectations. The supply of wood remained good during the quarter. The balance between local supply and imports was at a favourable and long-term normal level.

As a whole, 2019 was a good year for Rottneros. Production increased by 3 per cent to a new annual record, 406 thousand tons. We reported a strong EBIT, MSEK 268, despite the tough market. Cash flow from operating activities remained high at 462 MSEK.


In November, the Extraordinary General Meeting resolved on an extra dividend of SEK 0,70 per share in line with the Board’s proposal. The strong cash flow for the full year 2019 meant that our cash and cash equivalents grew by just over 138 MSEK to 376 MSEK at the end of the fourth quarter, despite the fact that we distributed a total of almost 215 MSEK during the year and invested 109 MSEK in our operations.


During the quarter, we agreed to acquire the raw material company Nykvist Skogs AB. The deal further strengthens our raw material procurement opportunities through increased access to raw material from private forest owners. This group accounts for about half of the forest ownership in Sweden. The ambition is to continue to expand the business as a standalone player and to gradually grow the volume of wood that is managed.

Our focus area Rottneros Packaging follows the overall plan. However, the delivery of the new machine was slightly delayed. It will be ready for start-up during the first half of the year. Demand for climate-smart packaging and fiber based trays continues to be high and is growing rapidly.

Finally, I would like to thank all our employees, customers and suppliers for a valuable collaboration in 2019. The work to constantly optimize the factors we can influence ourselves, regardless of external factors, will continue at the same pace in 2020. Our focused employees and solid finances mean that we are well prepared for both potential challenges and opportunities in the coming year.

Lennart Eberleh
President and CEO

(For full report, please see attached file)


This information is information that Rottneros AB is obliged to publish under the EU Market Abuse Regulation and the Securities Market Act. The information was submitted via the contact person below for publication on 6 February 2020 at 8.00 a.m. CET. This report has been drawn up in both a Swedish and an English version. The Swedish version shall prevail in the event of differences between the two reports.  

For further information, please contact:
Lennart Eberleh, President and CEO, Rottneros AB, +46 270 622 65,


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