Rottneros: Miss driven by lower prices - ABG

Clean EBIT SEK -100m vs. ABGSCe SEK -20m
Q1 likely stronger than Q4
Conference call at 12 CET


Clean EBIT SEK -100m vs. ABGSCe SEK -20m

Clean EBIT was SEK -100m, which compares to our estimate of SEK -20m. The miss was mainly driven by low pulp prices and higher costs. The company had a production of 80kt and deliveries were 5% higher than production. EPS came in at SEK -0.42 vs. our estimate of SEK -0.11. Dividends landed at SEK 0.50 (SEK 1.40 including extra div.) vs SEK 0.4 in '22 (SEK 0.6 incl. extra div.), and ABGSC SEK 0.40.

We had the following EBIT bridge in our estimates: We expected Q4 clean EBIT of SEK -20m, down from SEK 49m in Q3'23 and SEK 61m in Q4'22. The main effects q-o-q were likely: SEK +30m from higher pulp prices (2% NBSK and 12% BHKP), SEK -15m from FX, SEK -2m from pulp price hedges, SEK -5m from increased wood costs (higher prices in Sweden but less Baltic sourcing), SEK -5m from higher chemical and distribution costs (caustic soda price up ~8% q-o-q in Western Europe), SEK -12m from seasonally higher personnel expenses and SEK -60m in planned maintenance. We arrived at Q4 clean EBIT of ~SEK -20m.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/rottneros/Equity-research/2024/2/rottneros---miss-driven-by-lower-prices/