Borregaard — Interim / Quarterly Report 2014

Jul 16, 2014

Income Statement Borregaard Group Q2 2014
	1.4-30.6			1.1-30.6	1.1-31.12
Amounts in NOK million	2014	2013	2014	2013	2013
Operating revenues	993	952	1 985	1 902	3 886
Operating expenses	-803	-762	-1 637	-1 550	-3 176
EBITDA (adjusted)	190	190	348	352	710
Depreciations and write-downs of property, plant and equipment	-60	-53	-119	-106	-221
EBITA (adjusted)	130	137	229	246	489
Amortisation intangible assets	0	-1	0	-1	-2
Other income and expenses	0	0	0	0	14
Operating profit	130	136	229	245	501
Financial items, net	-4	-14	-11	-28	-41
Profit/loss before taxes	126	122	218	217	460
Taxes	-36	-33	-63	-62	-129
Profit/loss for the period	90	89	155	155	331
Profit/loss attributable to non-controlling interests	-1	1	-1	2	-4
Profit/loss attributable to owners of the parent	91	88	156	153	335
Earnings per share (NOK)	0,91	0,88	1,56	1,53	3,35
EBITDA margin	19,1 %	20,0 %	17,5 %	18,5 %	18,3 %
EBITA margin	13,1 %	14,4 %	11,5 %	12,9 %	12,6 %

Interim condensed statement of financial position Borregaard Group
	30.6.	31.3	31.12
Amounts in NOK million	2014	2014	2013
Assets:
Intangible assets	58	54	57
Property, plant and equipment	1 904	1 934	1 941
Other assets	57	64	51
Investments in joint venture	114	101	101
Non-current assets	2 133	2 153	2 150
Inventories	556	533	545
Receivables	759	773	693
Cash and cash deposits	48	35	39
Current assets	1 363	1 341	1 277
Total assets	3 496	3 494	3 427
Equity and debt:
Group equity	1 908	1 963	1 847
Non-controlling interests	8	8	9
Equity	1 916	1 971	1 856
Provisions and other non current liabilities	144	146	141
Interest-bearing liabilities	763	755	774
Non-current liabilities	907	901	915
Interest-bearing liabilities	95	5	6
Other liabilities	578	617	650
Current liabilities	673	622	656
Equity and liabilities	3 496	3 494	3 427
Equity ratio (%):	54,8 %	56,4 %	54,2 %

Interim condensed cash flow statement Borregaard Group Q2 2014
Amounts in NOK million	2014	1.4-30.6 2013	1.1-30.6 2014	1.1-31.12 2013
				2013
Profit before taxes	126	122	218	217	460
Amortisation, depreciation and impairment charges	60	53	119	106	231
Change in net working capital, etc	-55	-40	-84	-92	-17
Share of profit (dividend) from JV	-11	-9	-13	-10	-19
Taxes paid	-51	-4	-112	-7	-129
Cash flow from operating activities	69	122	128	214	526
Investments property, plant and equipment and intangible assets	-32	-90	-83	-149	-288
Other capital transactions	1	2	2	4	2
Cash flow from Investing activities	-31	-88	-81	-145	-286
Dividends	-109	-100	-109	-100	-100
Proceeds from exercise of share options	20	0	40	0	-33
Buy-back of treasury shares	-39	0	-55	0	0
Change in equity hedge	-2	0	7	0	0
Net paid to/from shareholders	-130	-100	-117	-100	-133
Change in interest-bearing liabilities	6	35	-14	-25	-218
Change in interest-bearing receivables	0	2	-4	-3	-1
Change in net interest-bearing liablities	6	37	-18	-28	-219
Cash flow from financing activities	-124	-63	-135	-128	-352
Change in cash and cash equivalents	-86	-29	-88	-59	-112
Cash and cash equivalents as of beginning of period	35	108	39	134	134
Change in cash and cash equivalents	-86	-29	-88	-59	-112
Currency effects cash and cash equivalents	7	10	5	14	17
Cash and cash equivalents at the close of the period	-44	89	-44	89	39
Replacement investments	25	72	56	122	226
Expansion investments	7	18	27	27	62

Quarterly segment information Borregaard Group

Operating revenues
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	3 380	962	949	933	919	3 763	960	1 007	971	900	3 838	950	952	1 016	968	3 886	992	993	1985
Performance Chemicals	1 414	363	376	347	362	1 448	378	431	386	391	1 586	391	418	416	420	1 645	442	472	914
Specialty Cellulose	1 296	431	387	427	399	1 644	408	419	415	374	1 616	407	374	435	381	1 597	379	359	738
Other Businesses	736	188	207	175	179	749	194	177	187	157	715	164	174	179	186	703	185	183	368
Eliminations	- 66	- 20	- 21	- 16	- 21	- 78	- 20	- 20	- 17	- 22	- 79	- 12	- 14	- 14	- 19	- 59	- 14	- 21	- 35
EBITDA adjusted
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	485	182	204	215	114	715	176	205	223	142	746	162	190	214	144	710	158	190	348
Performance Chemicals	290	75	73	59	28	235	57	85	75	62	279	68	93	91	80	332	98	116	214
Specialty Cellulose	111	77	95	124	89	385	80	105	107	69	361	88	71	98	60	317	52	54	106
Other Businesses	84	30	36	32	- 3	95	39	15	41	11	106	6	26	25	4	61	8	20	28
Depreciations and write downs
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals Performance Chemicals	- 187 - 24	- 47 - 5	- 48 - 5	- 47 - 5	- 45 - 4	- 187 - 19	- 50 - 6	- 49 - 4	- 54 - 4	- 54 - 3	- 207 - 17	- 53 - 4	- 53 - 4	- 57 - 5	- 58 - 5	- 221 - 18	- 59 - 5	- 60 - 5	- 119 - 10
Specialty Cellulose	- 68	- 17	- 18	- 17	- 16	- 68	- 20	- 19	- 20	- 21	- 80	- 22	- 23	- 23	- 25	- 93	- 25	- 25	- 50
Other Businesses	- 95	- 25	- 25	- 25	- 25	- 100	- 24	- 26	- 30	- 30	- 110	- 27	- 26	- 29	- 28	- 110	- 29	- 30	- 59
EBITA adjusted
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	298	135	156	168	69	528	126	156	169	88	539	109	137	157	86	489	99	130	229
Performance Chemicals	266	70	68	54	24	216	51	81	71	59	262	64	89	86	75	314	93	111	204
Specialty Cellulose	43	60	77	107	73	317	60	86	87	48	281	66	48	75	35	224	27	29	56
Other Businesses	- 11	5	11	7	- 28	- 5	15	- 11	11	- 19	- 4	- 21	0	- 4	- 24	- 49	-21	-10	-31
Amortisation
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	- 6	- 1	- 2	- 1	- 2	- 6	- 2	- 1	0	0	- 3	0	- 1	0	- 1	- 2	0	0	0
Performance Chemicals	- 6	- 1	- 2	- 1	- 2	- 6	- 2	- 1	0	0	- 3	0	- 1	0	- 1	- 2	0	0	0
Specialty Cellulose	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
Other Businesses	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
Other income and expenses
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	22	0	0	0	0	0	0	-44	-18	-9	-71	0	0	14	0	14	0	0	0
Performance Chemicals	- 1	0	0	0	0	0	0	-36	-12	-9	-57	0	0	-9	0	-9	0	0	0
Specialty Cellulose	0	0	0	0	0	0	0	-1	-1	0	-2	0	0	0	0	0	0	0	0
Other Businesses	23	0	0	0	0	0	0	- 7	- 5	0	- 12	0	0	23	0	23	0	0	0
Operating profit (EBIT)
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	314	134	154	167	67	522	124	111	151	79	465	109	136	171	85	501	99	130	229
Performance Chemicals	259	69	66	53	22	210	49	44	59	50	202	64	88	77	74	303	93	111	204
Specialty Cellulose	43	60	77	107	73	317	60	85	86	48	279	66	48	75	35	224	27	29	56
Other Businesses	12	5	11	7	- 28	- 5	15	- 18	6	- 19	- 16	- 21	0	19	- 24	- 26	- 21	- 10	- 31

Quarterly segment information Borregaard Group
Hedging effects
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	50	31	38	25	14	108	5	7	19	23	54	24	13	-7	-20	10	-17	2	-15
Sales revenues
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Borregaard Chemicals	3 340	942	938	922	916	3 718	949	995	964	891	3 799	939	937	1 002	953	3 831	969	974	1 943
Performance Chemicals	1 379	356	368	339	354	1 417	370	421	382	382	1 555	387	413	409	412	1 621	430	461	891
Cellulose	1 223	409	366	406	373	1 554	380	394	393	355	1 522	378	340	415	351	1 484	345	332	677
Bioethanol	70	21	20	21	24	87	28	24	21	18	91	29	33	19	29	110	33	26	59
Fine Chemicals	188	35	64	42	52	193	75	57	71	40	243	45	56	44	48	193	56	45	101
Ingredients	401	96	94	91	79	360	75	76	73	73	297	75	70	89	89	323	79	84	163
Other/eliminations	79	25	26	23	33	107	21	23	24	23	91	25	25	26	24	100	26	26	52
Performance Chemicals
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Average gross sales price NOK per mtds	3 285	3 381	3 167	3 077	3 274	3 222	3 484	3 371	3 370	3 366	3 395	3 802	3 741	3 863	4 143	3 883	4 492	4 354	4 421
Volume (`000 mtds)	453	112	122	118	120	472	115	140	124	122	501	106	126	119	111	462	109	117	226
High value % (share of total volum)	16 %					15 %					15 %					18 %
Medium value % (share of total volum)	68 %					69 %					69 %					71 %
Specialty Cellulose
	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.3	1.4-30.6		1.7-30.9 1.10-31.12	1.1-31.12	1.1-31.03	1.4-30.6	1.1-30.6
Amounts in NOK million	2010	2011	2011	2011	2011	2011	2012	2012	2012	2012	2012	2013	2013	2013	2013	2013	2014	2014	2014
Average gross sales price NOK per mt	8 099	9 762	10 142	10 530	10 746	10 279	10 628	10 519	9 822	8 902	9 949	9 728	9 011	9 464	9 152	9 343	9 065	8 711	8 891
Volume (`000 mt)	146	39,6	33,5	37,2	33,7	143,9	35,1	37,1	39,2	38,2	149,6	37,4	36,6	44,4	39,6	158,0	39,1	37,6	76,7
High specialised as % of total cellulose product sales volum	77 %					85 %					73 %					67 %