Södra posted a lower result for the third quarter of 2023. The result is stable in view of market conditions and in line with Södra’s expectations.
In the third quarter of 2023, net sales for the Södra Group amounted to SEK 6,545 million (8,102), down 19 percent. Operating profit totalled SEK 410 million, compared with SEK 2,480 million in the year-earlier period. Return on capital employed was 12 percent (41) and the equity ratio was 61 percent. During the quarter, the World-class Efficiency project delivered on the annual efficiency gains, which currently total more than SEK 680 million and contributed to the result.
The result for the third quarter is in line with expectations and a consequence of the continued slowdown in global growth, which affected demand for Södra’s core products and led to lower prices. Market uncertainty continues and the trend reflects the prevailing situation with weaker growth, high inflation and more expensive input products.
“We are currently experiencing short-term challenges and long-term opportunities. The third-quarter result reflects the challenging market conditions we are facing, and that we expect will continue for some time. However, as a cooperative that spans the entire value chain, our long-term approach gives us strength. It means our position is stable despite the prevailing situation and allows us to seek investment opportunities that will eventually strengthen our market position,” said Södra’s President Lotta Lyrå.
Business areas’ results for the third quarter of 2023
In the Södra Skog business area, operating profit totalled SEK 31 million (60) for the period.
The earnings trend during the quarter was mainly due to lower volumes and higher costs.
In the Södra Wood business area, operating profit totalled SEK 52 million (225) for the period. The earnings trend was primarily due to lower average delivery prices year-on-year, weaker demand and higher prices for saw logs.
In the Södra Cell business area, operating profit totalled SEK 408 million (2,393) for the period. The earnings trend was primarily due to lower pulp prices and higher raw material costs year-on-year.
In the Södra Innovation business area, operating loss totalled SEK 16 million (4) for the period. The year-on-year change in earnings was mainly attributable to lower profit from shares in associates.
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