BLRDF - Earnings call transcript Q1 2022

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Christoph Michalski

Thank you, Lena. Good morning, ladies and gentlemen. I'm here with Ivar, and we start with a short presentation.

Let me give you, first at all, an introduction.

I think this was a very strange quarter. quarter performance. history best to it the financial the had in when our comes We probably of which had be customer comes be We service one on it to when operating it and the it on quarters side. the environment logistics production in the we sales operating, the are or most and difficult And have clearly the when the about think in then a particular, quarter we overall in war Ukraine. the you very tragic environment, first

seen the both to performance. Net business in comes our it have which good, results. grew you very paper when in XX%, by So good sales side, and products, was very cartonboard

we inflation We have This was the about prioritization our aim the first a fully the both on addition price building widen and cartonboard, and buy the are very most there XXst America supply of about the of new find with reflecting to really improvement first explore And on that. focused partner, seen basically we our pulp closed of signed quarter to an acquisition. are addressing North understanding Norway. and sources the financial We and to business to pulp results that, offset a had the strategy, X basically some Viken memorandum Skog, production prioritization in also in where of high cost all-time more our events, of the our March. XX% in you all the opportunities have in wood. margin, our close opportunity our in and and on good these wood that And the or quarter strategy, mix also at worked quarter. But impact cost Verso we EBITDA the opportunity our and that of to

before get have war addition now mainly are very on what driven of by on good materials, Prices significantly chemicals, you is prices, difficult Everything further you detail has rise. having also, the in Europe very corona. operations. to the is tell different Logistics I energy the bit supply an because expensive more a will border with basically overall, bit starting to tightened. the And that our of of seen in raw little before quarter, go we environment particular terms the little Q&A. impact very in So Russia. will the to is results. And on Ivar about talk in wood you closure back on come to projects strategic side then a into to of

please, Ivar, over you. to So

Ivar Vatne

and our with morning, Christoph, Starting coordinates good you, some on everyone. Thank performance. net sales

And building activity alluded to, Christoph of portfolio. seen for categories versus pricing biggest more QX a it's and added Pricing previous quarter, any pricing impact. SEK pretty quarter, As quarters. we've versus the or for see we 'XX. the XXX incremental in that's we far do than million And year all XX% our block. excellent an past trend approximately much when on X% continued We're growth up the so really by FX the is and nice adjusting XX% double-digit ago been

mix. X quarters, as was that from particular, down many in sitting in investment, objectives our now behind base one also by Small of a board which our main KMX comparison, on percentage the And driving help still post sizable optimizing found of is sites profitable We our points. remember. negative some in impact stride and really have you the our we Beetham, for

stack. is where been all and If growth cartonboard, that coming particularly performance at our about, categories broad-based, is from the has and strong this look you quarter containerboard

say profitability the of sensational you profit bridge, move it's I a definitely if delivery. terms would been quarter So to over in

also adjusted that super we're when all area driving the talked really portfolio within already distance. continued are performance we been sales some the management high with. X enabled we one in EBITDA Frövi. and reported, finding all-time timing. by and on on, particular, this between Product bridge. has we pleased probably for mix sites. really focus the something comment now But in rhythm annual the And a good This more It's company KMX A It's and stop and been KMX And optimization actually quarter building with pleased quarter the quite our with have with has partly by and blocks. profitable enabled net this are Gruvön XX% that price for are XX% We that across. margin Board across had of extremely biggest

had We from cost efficiency and contribution good our also another program.

maybe One items different not is inflation XXX surprisingly on very million on a negative year main cost to of so ago. chart items, versus the SEK linked the

right, was million as on you details that find XXX the SEK week QX as will logistics, March. the a extremely come to QX. fiber, stop in million; XXX On is last XX was it's And the in part Some chemicals, SEK remaining where coming recorded stop QX. hedging slight positive to will from: that be recorded effective SEK XX million; And electricity, Gruvön we our of of annual started SEK the when million.

going industries further all I some topic for cost the moment. So the is, about a at move words inflation. big this know, also if forward, we on very much pretty and And

and XX SEK for it's or actually us and move or the SEK cost was also quarter-over-quarter, million limited. logistics, purchase fiber in now increases increase We've million; million. can in minus million, total. land. roughly means logistics XX XX quite will QX wood that for the if Chemicals will seen the that biggest been spot will million, QX. to We've the April versus SEK minor situation of We harder SEK and electricity how inflation pretty million. in of more have million. SEK QX, further expect pretty on be chemicals, state SEK SEK effectively of the Most are so be is XXX expect accelerate, to QX XX hedging help so There's the cost million. inflation the offset energy SEK the that also XX very we has insights that see starting and QX. us SEK hurt, in well million XX know our seen pricing XX land continue. seen million, SEK XXX up, We approximately XX QX, It's versus the So QX, items: is fiber in SEK cost and current QX of the major will a for XX start the which soda will a item, through XX purchase X of do much has also area situation with we million. accelerating million, We with SEK And increases versus caustic this now contracts, And the in then that energy, the SEK XX would hard. we given on we've hit we to is quarter-over-quarter, of wood between million prices particular, or

XX% with Now cost also states in of pricing the we inflation And QX quarter. we adding in another on it and of are offset focused mix. way as heading, in continued incremental pricing profitable the that our to incremental are coming the looking all

close financial terms quarter good another in we have should we when delivery of QX. our So

reasons certainly with stock that our have had And is results. around in capital quarter And phasing on One good is there another including and balance side were safety past with our A couple level some that. for being in more what we we've quarter. beginning sheet. bit of on our positive EBITDA low It's the over Moving returned particularly, quite to on quarter starting big the seen invoices between There's hurt certain year. been categories. words being some coordinates a result point. on the quarter. excellent normalized Working this a of cash a payables some flow also the the We've paid the level, inventory quarters. some versus

part at going for So working quarter least increase something that we are the not capital expect this would seen we've fully forward. of now

is QX That item one also And pricing, the particular, receivable on momentum. in keeps positive Now expect expect your with and in to side. would has receivable growing the in to we increased and line won't continue we balance net our that adjusted EBITDA more transaction mind rose X.X that that, Net ratio [ph] post excludes to Verso. keep contribution to some least ratio for debt increasing the as EBITDA quarters. any is growing keep from at in of probably sales Verso. Do

sorry, this bottom talk on left CapEx certainly coming So move the -- of unchanged, being, here, we expect the little get the billion. 'XX. And you this relatively we update base CapEx over X.X a If to ratio for so excluding outlook would to time slide, side for we left SEK the will bit side Verso, come down quarters.

mind Please XXXX. is timing recovery Frövi the SEK on adjustment purely moved this communicated that small up a project is been billion. has There change project a done overall in to and XXXX X.X earlier. that have the frame We that boiler to and keep no between

I that, hand to Christoph. it back with So

Christoph Michalski

Okay.

the of slide So next more a is placeholder.

you our see as we are on side, the And cartonboard. know know engine. that commercial growth on that all major We You focusing strategy. a

We have key identified the of the North growth America markets. as one

focus extent, with look a And is And we supply to and future, kraft about we or, optimize it And with market, when looking the for footprint market. a sack now next board. with all to to policies supply, added in the the it when We say, also continue our organically, have comes different little In our current to the to a foreseeable select European will good general, some relatively our to definitely, aware, Europe our opportunities you're really OEE packaging Union widen competitive move tight operations, continue to renovate in at opportunity wood on Northern assets. you, sourcing grow and, remind just pursue wood over opportunities the exasperated 'XX. and as the in Ukraine. war 'XX, value we're we'll have Scandinavia wood. But bit comes to in the

on So the going few have really about bringing strategy next we slides what achieved the context the of forward. are

U.S. a alluded, good strategy Gävle, the happy in so our comes results, production well. to really, over were basics have you we on us very quarter. a stream. results capacity next really of the for seen KMX the that, seen we had on basically, of you already We good in very is production has Ivar new And on in and And important Verso. very the all the now transformation performed the few production acquisition Gruvön. quarter. also, the with this, As Across with now have fourth of before the had focus this years Frövi record quarterly deliver And

They're our believe in currently of our part not acquisition are operating we that fits So strategy segments this core. perfectly. X

see the business and added of quarter, pulp. paper we years paper, generally really to performing after as bought the we it. can first specialty result is graphic business So well before significant BillerudKorsnäs you the But restructuring speaking, Verso, many of in

is ability you conquer bit this understand American convinced Ivar, the our run about intention about up switch be It cartonboard always talk skepticism bit market. so So North on over we that a I volumes This to absolutely think I'm that to successful think, then transformation. our to until is little detail production to is come. done significant I our asset. very the the will Verso? conversion are to and we now time give don't build that just And you is little you a why glimpse there a sometimes what of

concept sense in the that We have we stage. are the already the at started work conversion

But will plan to I'm performance to into that for called early that we But into today. see take quarter-after-quarter our will more we will very Ivar, then, little could And by solid that please business we continue you detail flowing through move this will and about how also program. in And how is order -- we will as visibility, And give We you numbers. integration and pleased speak expectation Billerud Verso, us a North is our by a which the in in feasibility. generally CapEx now And we now in talk XXXX. transformation now the you bit much executed. very America. have we close speaking, be can my

Ivar Vatne

that shareholders the a Verso that of needed from than be Good. And that pretty meant no quite the from billion. much A quarter for the QX. obviously was now the given Thank of worked expected. March, Pretty see support faster so. able the for point, we're X.XX over it to it's No, last closed. hours from see regulatory approvals closed, much delighted I the price And the allocation P&L for landed the SEK purchase of you, take bit only And a with and happened strong X.X will is that mentioned, billion. there's Purchase obtained impact certainly deal major the close of before company pension And top yourself, was yes, Christoph. the we've we're that we But FX pretty we to bullet XXX much Yes, debt QX balance million do cash liability. we're get item already you X.X is time weeks and you certainly, all will will some million. closing it in of SEK SEK onwards. over. $XXX exercise. rate We've taking debt-free a being. can price right

of the value purchase about But shape completion. acquired in for well on and small exercise We consideration the tweaks have on Analysis confirmed going we are to in liabilities. almost good the extent probably the We're to assets meeting call that quarters. has preliminary general. gone net full also price coming potentially talk some that and reached we what a

In is terms conversion there of talked not from so what already we new news and the communicated. much project,

during move beginning XXXX. pre-feasibility that reaching on will and of into phasing, et bring We QX to be starting able is we the do its of concept expect after to conclusion, cetera, half And up second details we CapEx the year. Right. and will be more potential be in timing, feasibility studies the

debt-free pretty only company, across I the for if offsetting up than strong inflation. is we profitable a on has to been and categories. is And sales as excellent over coordinates all an and very news. more much BK which move excellent some mean, over it performance also also mix growth Profitability Verso. cost further pretty pricing with XX%, for much QX, So Net not quarter double-digit cash, QX it's the by Verso taking we generates performance, are driving

see per IFRS. to pension that comment one which points this onwards, the consolidating And use, the from down on and is to this expect we do the result screen, Now accounting is profitability But now. EBITDA the is main extremely X of see performance standard that plan XX% The handling please and GAAP. when particular comply related BK into mainly difference the we to as you is But account that reported. some by was number Verso we U.S. Right. taken some kind percentage typically of with comparison and to now on QX take doing return amounts. leasing into treatment pleased QX the level smaller general, of Verso it when in

Verso some into coordinates the rest the QX, for have already and story about items moving a BillerudKorsnäs. for would also very So We we expect year. of talked on QX for for similar as more probably some

mills. comment maintenance The our QX, the annual during to And stops be much with going there I'd expected, pretty seeing to some driving is and be sites close price have management we into Continued are the sizable downtime impact in SEK an go a strong pretty days also are market are we would the and between focus million, seen of quarter. sites. in or conditions have are that is X on. then to the our and expected we offset on Escanaba estimated mix like their to see It's downtime Nordic-based differences stops both Nordic current If what of inflation. planned sites line in to XXX which again what the

since significant it's site of machine time, annual at boiler But was be XX that site been recovery this the would combination more this I expect. than built at days a a Quinnesec, done explain -- with stop is stands this for is mill maybe in a mid-XXXXs. normal expected out down the would for 'XX, probably And XX the days. amount for some bit have the first down be paper planned upgrades for you is Now the to to with bigger what

of on top would furnace boiler machine. upgrade, a and digester infrastructure the upgrades the replacement, Some lower recovery power paper items key different include

it's pretty a into Quinnesec as event downtime in also would expect in see is a we more to exceptional of going Nordic. we 'XX. for bit a naturally and normal to X next Verso big for forward this a years, schedule days XX nature, got the And of have currently So

expect the this QX, SEK for now, XXX for we QX but longer-than-usual QX what are more the analysis. -- we stop. CapEx that million as to line, would changes one-off forward, guiding we XXX in QX. normalized number item range for Quinnesec XXXX will one-off, come getting Depreciation maintenance to million our expect is to what the a That the as there roughly then CapEx related XXX be that to inventory includes XXX it are are SEK in Another consequence, year, step-up XXX expect we expect. would million. number and of that could from some remainder the million is the annual SEK for obviously million we to SEK impact. back we the A and is SEK It North we PPA This But under we are And going from to items on when negative listed the be and, Billerud in America onwards. down are on. will be closer that a

So Christoph. to I with that, back hand it

Christoph Michalski

you, Ivar. Thank

with that the we So our another during Skog. understanding quarter project was Viken basically very announced exciting of memorandum

tonne was wood to close whether us relatively and Gruvön be It's complete I It's that one and about the of an Skog Viken years south in Viken we and, basket exciting flows mill sites from built plant together very Norske the also which but them worked area. opportunity and wood for the XX of that ongoing will basically, the connected be are And study in came that then into build would this to of pulp project. It's with pulp the feasibility it's it's some at together to to create we partnership is the a venture, time in -- And born, for to we're of with study. production the good the by a basically a mill. at in was Follum half The see a will BillerudKorsnäs. buyer in joint owner, if have negotiating relatively that This sea, by Skog feasibility operation also our say, ago. and they a good first rail. conclusion now time finalization low we CapEx same time And We decide XXXX, by in connected goes a be understand per which XX, to the the very develop so alternative on then quite Norway. Norway. same based by idea for could is very of the sitting then, project And ahead. will the additional the Follum BTCMP Skog addition, of these for think the

mean allow calculate And as of it's would CapEx a same do of with America, I therefore, defined. mentioned as also going is per to there's high an before, time degree opportunity Billerud But capacity. over in XXX investment us flexibility be of this will SEK North tonne, very terms an in steps profitable. you us, For multiple you And forward. it million we SEK to of if That view, around million. in to XXX the

mentioned wood So to as this. I is And I'm our our, wood strategy we basically with can the line this very on. of widen happy that sources fully in supply rely before, about

is renovation raw very a terms existing plan and in boiler in the our improvement in project footprint, the things despite to materials Frövi. recovery proceeding mentioned quick it which the like update. disruption forward, of and is and Everything Moving all I of logistics that.

are XXXX. Good. for hard we budget on let's all to the moment, that coming. the will And go of our time QX on happy. work think pricing what's cost is -- things and on aligned. we So in are we certain It's get side, the definitely offset the that, know outlook with we because, are very to Having the increases and deliver end to that said that It's pretty mix, QX. coming. price all I is But

beliefs second side, have even On But clearly, my very for of are, it's balanced it's we to what that it's we you give half will the the tell that be coming I And which out or predict. don't bit the I also you not way very, drivers that. we one is contracts the what's can are uncertain. because like and other. know seeing, hard just cost things little situation very the a

will that would first expect, over believe now, the all continue that raw think So war Russian increase because Ukraine for we material to don't be if we supply. was the one, the open wood in I even the border

from to we continue materials our expect all high-energy-derived have be that So applies. will that will extent, just pricing. relative scarcity, therefore, be we chemicals next open for prices, the energy the prices the for to When on you logistics, transport The also effect day Europe we unlikely raw the energy some that same It continue will And is or borders in step continue scarcity it disrupted. disruption, is believe overseas, still wood production. the so use very or be the in will X. and at and scenario look rising that to

You not have has COVID. seen away. closure of with gone Shanghai COVID the

will be Asia. that So disrupting transport into

a for the good -- what very prices, will you still It was challenges, we of has the forward second even of the You BillerudKorsnäs about the in that have for bad. projection of we war cost increased as come And Russian prior is think, take finishing years, the coming are have Ukrainian faced world, if really as at America it's our butter back very, have with Billerud you, and X And operation. aim a business now banned as part issues to And X same. mix a to we're say European also similar, deliver And the and seen this to slightly true home to the difficult. and raw XXXX of can the is these of which years. then don't basically drivers continue And scarcity in in but also of priorities lot but prices the Europe different quarter and will but America. talking the I We with really materials being our are delivering going Union, production. successfully very segments. very quarter even But to we transport in of sometimes bread What is very would rest are challenges business inflation do? XXXX, we scarcity even simple to sometimes X the North quarter North on forecast and their X The we top of of basically basically and look, about been the like a from that in And country. talking defend second that, logistic actually year. for mastered. we certain therefore, not are makes essential for half and XXXX inability just and our best it X.X

have is now between The the started second companies. part, integration the we clearly, X

experienced America in are North over think creates Billerud happy know, who the in majority have I We acquisition working people. of very in there kept to you this operations And are are disruption there, management qualified North which with as This therefore, the also, who very a very the lot of is colleagues new is our and much stability good. not by America. of population wider the

part and, and these cetera, I end further year by et We visible will to and already of And systems much will that year, versus which the will sorry, think the and achieved end -- Ivar GAAP structural on. will of and of the which IFRS integration, type be then of things. more follow the by like are mentioned, start now be on all there and the IT, work I think as integration consolidation

clearly have our priority is we which transformation third mentioned. The project, already

go phase. go we into pre-feasibility. into now So concept We

beginning, Ivar the job We with first mentioned I good will CapEx that that we Russia of make this up all and sure CapEx because still XXXX. estimates of the mills of the the as Ukraine, a cartonboard, we we the to understanding with a the by end our in for XXXX. war at want half uncertainty that could around have really intention that the be the But have and running XXXX beginning have by is you the one stage, of know, the and planning machines and at of do Good. we costs. right need And to for think implementation. one XXXX,

I think we stop here.

know, a you give X you and will now breath, ask in in question As us X go.

now one. really happy please one. fair. very it can That's would for questions, much very Otherwise, your -- one forward I'm you appreciate this another And But during to remember. but look I to your I'm you one us ask will ask X So ask them presentation. by We looking forward questions. to for difficult thank answer be and all you attention then

Operator

[Operator today Robin comes from Carnegie. Instructions] from Santavirta Your question first

Robin Santavirta

strong And QX. in congratulations a for quarter

troubles to a have outlook and mentioned. quite overseas, pricing you see that give back. the you question, My related What are ahead as how financial availability and invested you time a wood look you -- of of now detailed two, strong is -- going one as these first shut closer at outlook raw Baltics Quinnesec How thank for very short that? the -- the see borders. some the you X perhaps mills? the had given outlook pricing you take mills of is QX. material from do well had do Russian the bit term well a much surely, Number especially Now in to do in for Verso Sweden sort few Escanaba. you years What and

shuts we you If plans now. listen And the quite cost come to given on those inflation or Could some CapEx finally, conversion Now mills X and on share of what that information X. significant out is we that? of investments Are you billion, the them. the Voith maintenance these manufacturer, the related about inflation. SEK investment see details significant equipment invested to you with outlook quite companies outlook or Could see significant We well that? So pulling share CapEx? some transformation the some not? ANDRITZ,

Christoph Michalski

wood Okay. general answer Ivar, the CapEx. the will and let then, context, then me and if the Maybe I the start you mills prices the about about on to on want outlook talk itself. on price,

which coming and clearly And are Look, gap border, million at turns about closing market then of in Sweden X/X Finland. Russia at looks the this by Okay. hardwood X/X wood Baltics. from XX a softwood. into and Finland, there's of Finland And the cubics is around in and created

And is the the mechanism prices. that so why

So we year. wood of planned this had Russian for XX,XXX cubics

canceled in end not woods clearly, using are have already now price But we and Baltic Russian also We have of increases operations. through in the seen coming at some Sweden our quarter of the any and in pricing that an acceleration the X states.

a Do will and that the So other possible. on Ukraine talk war Russia as immediately impact even about therefore, inflation -- inflation on said, please? wood X away the will us, will will think that we sanction you day the go the as the And soon to little as war stop on basically we wood. bit if hopefully from clearly some this the this I expect trend stop Ivar, have because, want will in not or not

Ivar Vatne

there the observed think even. Robin, and tight, say, also you a the hardwood can can that increases price on list the where I more I situation particular, now rounds Yes, across in several I coming think I is bit that. is do same,

positions. of one You also large know of that a few have buying are portfolio the players pretty who we

much price expect during it's this a XX increases QX. maneuver with softwood, into pretty tight. good again, a us that time we again, found I But that yet. hardwood is its going cubic on to the that know, But impact we meter as increase lag, the per coming availability. our of hardwood of couple good I necessarily way. top I is probably start think seeing to SEK you on hitting So it's on it's don't some there list balance versus can. into would when overall the that still certainly Currently, But And as think very has But is softwood. market full QX we're what harder as coming QX. we're the it's story more try And would

Christoph Michalski

Ivar. you, Thank Okay.

let your me to question. Okay, second go

So really and think this big an that well generally the And will America, Quinnesec on or further outage the improvement have in North in mills upgrade investment is was are speaking, I the big invested. and always now basically productivity on which outage mill some The planned. cost. of

purpose, these investment comments and best our far black and, just i.e., the in to think graphic When creating And they of the sure a business look you mean other will at for decline, comes our so that last that's men will if paper in hole. and a very standing, knew there that continue in productivity. U.S. the in be outlook, we big on particular, But would very into but to America. and the So in making the CapEx fit some no go you that profitable I we about knew North is say. work And particular are will mills, be focused it general of a in is away to a know, leaders outage. CapEx that therefore, mill. this on And assets, not good North than basically project America the strategy very into transformation to cost lowest that they good these it investment as cartonboard be renovating it, assets I a it's so into make is Both order that cost

go is all We do feasibility. know prices stay stay now So do are forever. that the will We perspective forever. that level not all energy into will we pre-feasibility, will not the do my know level we the that we that ready we know steel And we at and we the the feasibility concept, implications are. time what our then will prices CapEx, with that at will

lot where business. to cash a invest in existing And do other transformation, a project on we One thing we bought delivering flow, comment is the flow think to the our are the that. the advantage it's of as will I a mill we machines are a agreed of during actually a you has is that and first So running, hard flow or time, actually, you which come the to And which back things an idle business, strong keep long have will about greenfield in or the CapEx very business market we cash deliver having as mind, cash good talk other it. U.S. rather And any to Board when of a then money and ready that. key in I of from think the we don't than very you profit to

Operator

of Your Linus comes from SEB. the next from question line Larsson

Linus Larsson

continue Please CapEx. let me on

But outlined you to some on you well give don't you could to for also color want You comment XXXX. XXXX? the more if you that understand have if pretty I it, extent the on visibility, what could expansion your at CapEx. base operations transformation Billerud plus base at the Swedish let's clarify CapEx maybe Verso, CapEx CapEx Verso you and call the at but own, expect

Christoph Michalski

start? you Ivar? want Or Do take that, I Okay. should to

Ivar Vatne

no, happy No, that. do I'm to

I an Capital -- to That's CapEx of interval will sites, think presented in some the the think we can more our I I we mention of the billion. we SEK I for we best and what we on go SEK 'XX, Day quoted fall billion, of give back still, X.X in Nordic 'XX. number base think, X.X bit back invest Market that did also where a I

for million million I XXX went number. U.S., recovery SEK in billion, XXX then back million SEK We X.X SEK and But will bit X.X I I little billion as best half a project. the the between being. use the come would accurate have XXX would We more think number the the somewhere so the for for with through, time second And just probably boiler expect SEK the is we probably Billerud SEK Frövi, now. for

start-up think say. but mentioned early to it's also is we -- any excluding case, have this yes, conversion I it, might you too on the potential Now

also to we But if decide that we excluding it anything then become that project go hopefully, will potential helps. is reality a I forward. think might do in and the Viken

Christoph Michalski

to do their currently strategy over I a to different maintenance how little the think has years. want add just to mills, Also, that. they the North a America very I Billerud Swedish bit

X days know, So tend factory, in then do if we shut pulp in machines, do have they week, that recovery different. continue and second all the they do maintenance stops boiler, the And maintenance XX or for permits the paper Linus, something, then that have every have And start X Sweden, the operating reserve. as year. they couple the boiler just so you major the to of years recovery slightly every U.S., actually, where them produce up on the a they to weeks, stop would we years. They for X of again. for they In based

I the with just a very XXXX it. maintain another different Quinnesec little it's just with regular in a but it So slightly And very happens be Quinnesec. upgrade lower of to a on of year XXXX, at successful different will it higher think the It's heavy way have operating. And that a thing, year to be also been And not year. you then stop way mills. bit doing and big they order X will of and a in a then is see

there at to their strategy no is reason So change. this believe should that stage

Linus Larsson

just on then the on little if And you Great. explain a shipments, could bit development. volume

first X% quarter, shipments were year-on-year fantastic yet a had production-wise, the quarter. down said, you You in

it a board you If you and you could But both were in the bit quarter first -- if down paper why regards upon explain in Beetham. and more with to volumes maybe touched year-on-year.

Ivar Vatne

a it's No, good question. Yes.

and then Let me start, Christoph jumps maybe in.

last certainly a products. This of, the things from this, very focused items the of couple we ramp-up. wouldn't this particular KMX high it actually primary a around there's year, call it's paperboard do year of percentage I got secondary we was solely rid think And in value good didn't where year. I of lot scrap, on but

So that's part of it.

ago, in takes -- big it and longer. we I pretty see general, though, a this how think year change from is times was a delivery

tied think by those biggest of, the the We more longer if gap have are X items, in a transit customer. XX,XXX lot would XX,XXX, those product on you tonne good let's way far And for on delta adjust its the the say, to explain estimated delivery of that I a volume. for

Christoph Michalski

these you big And back. is are part, on board stocks after packaging this in And the safety other basically in Gävle, building after Gävle. liquid stocks, explosion in in that remember, flooding very the low particular, were we some rain, Linus, we the basically

that growth all value growth delta in explains think the plus and I So price volume increases. the all, between

Linus Larsson

Okay.

final question. one Just housekeeping

mean, then million price you've done And amortization acquisition? of You preliminary additional things QX here. Verso analysis. said mentioned -- on this of also from the is you just well, the XXX reflect increase? that all, depreciation that -- from including expect to purchase first you D&A say, in a acquisition you get right the Is potential I altogether relating also SEK to allocation onwards, does increases

Ivar Vatne

absolutely, and estimate. bit a it's I No, an of Yes. think

I we think as preliminary was said, I it a completion. --

And then a XXX SEK the get time. estimate taking still completed PPA due items now fine-tuning per we've an quarter small into on expect there's some come we in familiarized million and the that we bit we definitely the will what So account to some exercise But there know more quarters. with is that coming so number, back far. after be might over

Operator

Grunselius Your next question Johannes DNB. from comes the line from of

Johannes Grunselius

your what have if what you on have that an out I positive sort could you on be you the with up my a lot production than I here. that shipments about Johannes production. should about here question P&L Because P&L? if produced, would rather flat gather perhaps give meant effect indication ship for have -- of the I follow-up shipments that what is, Linus' us would comes a you're questions -- your if down But know you year-over-year. quite It's even But interpret don't is, I or indicating year-over-year. being to

Christoph Michalski

That's very speculative.

P&L We gone into to X%. said, have you said, it as of production, don't more. say, would it it's would X% entirely speculative, well, But shipments. delayed would have so we have in that goes it's And increase in stock, if you I an because think okay? see and the around I

And to you as succeed difficult the we or think Russian situation this been our with which I a from you okay know, right challenge, have the You right more end of quite tightened our logistics the to has user in of war underestimate become cannot incredibly factory has because, trucks. get the products. now number

are trucks. number home Ukrainian before. war. that has You Russian And than drivers fight to trucks Ukrainian The The even banned. situation more have a the exasperated the of went basically

can the the the that's say, of we then gates. factory reach the And as on is situation. which will customers. it book their hits So the make road on And I and soon well, will as that sales profit is at only everything point think I stage top to some our

Johannes Grunselius

about was Okay, wondering and more to Russia your paper normally Europe, less I at is also or comes And know. X interpretation is that I what that's the good suppose exports to which moment.

are impacted involved grades brown which in of mentioned sort maybe the in sack one hit color here? paper that report. of supply you the the are And other give being You that? Could as on you here side grades some on mainly

Christoph Michalski

and cartonboard that's Yes, good. and give are there all in is of X maybe have exploding, looks then let we prioritization suddenly growth like here kraft me color Basically, you that how effects. sack and a because some it

on with The is in the have particular has and now that Xst -- there's benefit the annual benefited, scenario an back kraft clearly, some 'XX price and the industry. 'XX, in suffered kraft, has of therefore, increases 'XX. takes And in sack that first basically in this contracts, And basically, the and sack annual the 'XX and effect increase, in price we cement longer-term January. gets

So Okay? that's one.

very I of the in is all see very these all are remains a entirely know normally type is paper trend today a material. you're packaging European around there. what for But XX,XXX Prices absolutely paper Union. which kraft available to We The away European anymore short-term okay? good, market part, moving no effect the other think that is there plastic would we hot. that I this of underlying Russia Union i.e., of so very is because be short-term from export right, lack up, from things, packaging, The into -- e-commerce, is paper going very, effect. it's the of tonnes trend think still The

capacity comes of the a, it so prices very able the high in integrated, have. by be specifically, replace us with strike European have Okay? struggle well, are when those to And for non-integrated. pulp prices if Finland of to incredibly producers, they're And because And and energy high the this that UPM to they not will volume. they they hasn't helped some who us, clearly, cover easily

on have production to is pulp. gone. the of have in we tried we lost, work we But UPM to whatever So continue have out whatever strike lost

production also is closing in rise. back are driving the Russian we Finland, in price basically Now but the border, of incredibly situation, full this based the high on

Operator

Christian question comes next Your Kopfer the of from from line Handelsbanken.

Christian Kopfer

Just a my few follow-ups from side.

but Firstly, quarter? say the on for had how much you Verso Verso, maybe and deliveries it, it, sorry if you in missed first I did you mentioned

Ivar Vatne

roughly talked X I net through we billion and the about went QX mean result, we sales. SEK of

So all that went we through.

Christian Kopfer

many how in were the Yes, deliveries? But know. How shipments -- first the much many quarter? how I

Ivar Vatne

tonnes? In

Christian Kopfer

Yes.

Christoph Michalski

In tonnes? U.S. nonmetric

Ivar Vatne

Exactly. it, for... I have sorry,

Christoph Michalski

we follow with... can think I up

Ivar Vatne

no. No, no,

Christoph Michalski

You have it?

Ivar Vatne

I do. It Yes, tonnes. was XXX,XXX roughly

Christian Kopfer

Verso? year guided quarter did in maintenance last you year. in for And How was that's for which this Okay, have And much also, Verso they the it appear? for great. stop

Christoph Michalski

go I to into think want we don't that.

it's quite think I well previous quarterly their stated reports. into

Christian Kopfer

QX, left how Okay. And much to mention then is spent cash finally, be you for if can the acquisition? on

Ivar Vatne

cash-out you're you, impact, talking now probably too will Christian? are guess not expect we I Yes, much. about a

Christian Kopfer

exactly. Yes,

Ivar Vatne

Yes. SEK We area think, XXX would of I million. the in expect,

Operator

Danske line comes question Lindström, next from Oskar of Bank. the Your

Oskar Lindström

my there sort Lindstrom. wood of in what near-term see resulting sort Do a have issues contracts? actual coming or share rising about likely contracts for first more like costs risk in also a wood guiding tighter couple a quarters. Yes, spot are versus were the wood supply is of years for markets on And purchases Oskar you mean your you're of This sourcing. that's I longer-term of question ago? I question.

Christoph Michalski

that we basically, What Oskar, this softwood. is is say, don't so any impacted shortages stage. hardwood clearly wood than at so let more see Okay. we me see

those. sense supply of shortage not of That I do And problem. the we because front we went softwood some the wouldn't in a through not well the of increases as price substitution wood. think But are get effects in is between

there is ground, I this companies add the and we security market. also trickle forest on are what contracts? will such something that Ivar, do supply prices, But that is is to think owner seeing an effect the and on you increased not large that to want so at now stage. have the their issue

Ivar Vatne

more have think the know, just a good I with No, that's is different Oskar, still concur we I pretty of large mean, pricing And the se. a what Christoph basket really. not there pretty part mechanism, mentioned, I contractual suppliers. No, and as softwood. per availability of can you on

less be the Hardwood, a is to looks tight being, but that challenge. time for So of manageable.

But for hardwood no So getting time at is all being right. we doubt, the tighter. least, feel

Oskar Lindström

also My the second extent in that question cartonboard right. swallow cartonboard this To a you of market on capacity additions and cartonboard the lot the and All seeing in Do does pipeline we're new give capacity market. Nordic being I capacity? is think mean announced can concern? peers. what your the you from new

Christoph Michalski

we capacity, we sometimes. if double sell would Oskar, the at had fields still

and all do to you this more so It plastic. by, with do said, e-commerce from that over fact and recyclability underlining do switching have. I the I So a, paper that the whatever market brand the short, to been has trends, is has that has carton has and fact much as moving think with the to into owners

I we the When and good bit we okay? still And therefore, don't And underlining better, some long are so rid the times far -- in that's of the packaging end it. will you cartonboard because seen from was because in incredibly of books, a are in thing look in brand it market our is the where to what think if So little at we cartonboard it increases market. alternatives packaging situation, the shortage that a situation they prices -- see materials. totally then market okay, remember just we type not these prices stabilize have owners that the unacceptable. exists decide And continues order to the probably is I for where look will mean covering get however what goes toothpaste the certain rise, areas, of of for the basically excellent. package, have Maybe capacity even see you

or that the see about. it will decline. I I'm the something more to So worried capacity worried. But increases I'm added more price more worried to worried demand or I an is I think not are because then lead not a we end -- -- think ultimately

Oskar Lindström

of you Do more a a increase than right. this? All sort see structural in demand offsetting

Christoph Michalski

the Exactly. trend underlining the And very, like very corona, in things. then downs is of good. disruptions you and other have ups like market because cartonboard But

I at the from sorry, under I side, conversion graphic on of paper. newsprint But still because admit, think into XX:XX. I'm paper thing. packaging cartonboard clearly totally into arrived pressure must opportunities -- that's the very is we different

So I question and suggest one we stop here. more then

Operator

no There further questions, are sir. currently

Christoph Michalski

guys, Hey, Perfect. organized. you're well so

quarter to X. speak on you bit as for our better, to we you quarter questions HX a the tell X key moves to that future closer, So and as have. we as today so thank joining we about you, becomes the forecast We're get the everyone, forward for And can results. probably looking -- call you more the

in in forward to meanwhile, Thank of the So I'm the endeavors. you to then. speak And success all best looking you. your

Lena Schattauer

Thank goodbye. and you,

Billerud AB (publ) (BLRDF) 8 May 222022 Q1 Earnings call transcript