Record high cash flow despite a challenging quarter
Dividend proposal EUR 0.50 per share
- Sales decreased by 9.3% to EUR 2 411 (2 657) million.
- Operational EBIT decreased to EUR 112 (271) million.
- Operational EBIT margin was 4.6% (10.2%).
- Operating profit (IFRS) was EUR 680 (356) million.
- EPS increased to EUR 0.66 (0.39) and EPS excl. IAC was EUR 0.69 (0.33).
- Record cash flow from operations amounted to EUR 721 (323) million. Cash flow after investing activities was EUR 518 (148) million.
- The net debt to operational EBITDA ratio was 2.1 (1.1)
- Operational ROCE was 4.2% (12.4%).
Year 2019 (year-on-year)
- Sales were EUR 10 055 (10 486) million.
- Operational EBIT was EUR 953 (1 325) million.
- Record cash flow from operations amounted to EUR 1 980 (1 365) million. Cash flow after investing activities was EUR 1 386 (811) million.
Outlook for 2020
Subdued and mixed trading conditions caused by geopolitical uncertainties are expected to continue to impact Stora Enso in 2020. The decline in demand for European paper will persist, and demand for other Group products is expected to remain mixed. Exceptionally mild winter conditions in the Nordics with reduced period of frozen soil could impact harvesting and transport of wood and may therefore affect the stability of raw material supply and potentially increase wood costs to our Nordic mills.
Stora Enso will continue active cost management in 2020–2021 through the profit protection programme implementation. The fixed and variable cost savings target is EUR 275 million to the end of 2021. Various labour unions in Finland are currently on strike which is expected to impact result negatively.
Guidance for Q1/2020
Q1/2020 operational EBIT is expected to be in the range of EUR 90–200 million. During the first quarter, there will be an annual maintenance shutdown at the Ostrołęka Mill paper machine 5. The total maintenance impact is estimated to be approximately EUR 60 million and EUR 10 million lower than in Q4/2019 and in Q1/2019 respectively.
Various labour unions in Finland are currently on strike which also affects Stora Enso’s operations. The negative impact of these three-week labour actions is included in the above guidance range for Q1/2020.
Source: Stora Enso