Metsä Board Annual and sustainability report 2022





■ Sales and result Metsä Board’s sales were EUR 2,479.6 million (2,084.1). Sales increased due to the higher average prices of paperboards and market pulp.

overall impact of pulp on Metsä Board’s result was markedly positive. The general cost inflation also affected fixed costs. In 2022, inflation accounted for approximately 20% of Metsä Board’s overall costs. Unused emissions allowances were sold for a total of approximately EUR 29 million during the year (1–12/2021: EUR 21 million). The associated company Metsä Fibre’s share of Metsä Board’s comparable result in January–December was EUR 174.7 million (123.0). Metsä Fibre’s profitability improved thanks to higher sales prices and the US dollar strengthening against the euro, which also compensated for the strongly increased production costs. Financial income and expenses totalled EUR -6.6 million (-10.0), including foreign exchange rate differences from accounts receivable, accounts payable, financial items and the valuation of currency hedging instruments, totalling EUR -5.0 million (-2.3). A total of EUR 8.2 million of interest expenses for ongoing investments were capitalised in investment costs. The result before taxes was EUR 524.9 million (365.8). The comparable result before taxes was EUR 514.6 million (376.6). Income taxes amounted to EUR 63.5 million (51.8). Earnings per share were EUR 1.15 (0.82), and comparable earnings per share were EUR 1.13 (0.85). The return on equity was 22.5% (19.4), and the comparable return on equity was 22.0% (20.2). The return on capital employed was 21.4% (18.2), and the comparable return on capital employed was 20.9% (18.7).



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Folding boxboard White kraftliner Market pulp Others

EMEA Americas APAC

The comparable operating result was EUR 520.7 million (386.6), and the operating result was EUR 531.5 million (375.9). Items affecting com- parability totalled EUR 10.8 million in the financial period. They comprised EUR 19.2 million from the sale of the share capital in Hangö Stevedoring Ab; a EUR 6.5 million capital gain from the sale of a land area unrelated to business operations; EUR -5.5 million from the restructuring of customer service and supply chain management; a EUR 2.8 million capital gain related to the divestment of shares; a EUR -1.0 million impairment recog- nised for Russian operations; a EUR -10.5 million impairment recognised for the Russian operations of the associated company Metsä Fibre; a EUR -1.2 million impairment recognised in the assets of Metsä Fibre’s Kyrö sawmill, and EUR 0.3 million for other items. The comparable operating result improved especially due to the higher average prices of paperboard. Higher market pulp prices and the sales of by-products from pulp production also improved the operating result. On the other hand, the lower paperboard delivery volumes weakened the operating result. Exchange rate fluctuations, including hedges, had a positive impact of EUR 57 million on the operating result compared to the comparison period. Costs increased rapidly especially in chemicals, energy and logistics. In chemicals, price increases were particularly notable for caustic soda, per- oxides, starch and latexes. Energy costs were driven especially by higher electricity prices. Logistics costs increased due to the limited availability of transport capacity and higher fuel prices. Wood costs increased because of the rise in wood prices and harvesting and transport costs. In the paper- board business, profitability was weakened by higher pulp prices, but the

■ Business development

Paperboard sales Metsä Board’s paperboard deliveries in January–December totalled 1,817,000 tonnes (1–12/2021: 1,922,000). In the comparison year 2021, paperboard delivery volumes were at a record high and occasionally exceeded Metsä Board’s production capacity. The demand for paperboards remained exceptionally high in the first half of 2022, but normalised in the second half of the year. The change in demand for paperboards in the latter part of the year was driven by the decreasing demand for consumer products and the inventory adjustments in the value chain. In the first half of the year, Metsä Board intentionally increased its very low inventories, partly in preparation for the investment shutdown of Husum folding boxboard in the autumn 2023. The folding boxboard volumes previously directed to Russia were successfully reallocated to new markets. In 2021, around 130,000 tonnes of folding boxboard were delivered to Russia. The sales of dispersion coated barrier board, produced in Kyro folding boxboard mill, has been rapid. Metsä Board estimates that in 2023 roughly half of the mill’s production volume will be dispersion coated barrier board. The prices of paperboards continued to increase in the fourth quarter. In 2022, the average prices of Metsä Board’s paperboards in euros increased by approximately 25% from the previous year. The strengthening of the US dollar against the euro contributed to the increase.


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