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Södra's profit declined

Feb 2 2010  Södra’s profit for 2009 declined by 34 million Kronor, compared with 2008, to 662 million Kronor. Recession progressed to recovery in the second half of the year.

Södra's net sales 2009 amounted to 16,696 million Kronor (16,993), and the operating profit amounted to 593 million Kronor (809). Return on capital employed declined from eight percent 2008 to six percent 2009.The effects of the global economic crisis resulted in a very weak start to the year. Extended market shutdowns were held in the spring at Södra’s Norwegian pulp mills. At the same time, the decline in price and demand that commenced with the crisis continued during the early part of the year. Price falls slowed in the second quarter and began to recover after the summer.“During the year we went from a situation of economic crisis to one more resembling a normal recession. Our production units have been running at full capacity since summer ,apart from shutdowns in conjunction with planned maintenance,” said Leif Brodén, CEO of Södra.Södra Cell, Södra's pulp producing subsidiary, shows an operating profit of 406 million Kronor (902). Södra Cell's sales amounted to 9,601 million Kronor (9,712).After the initial crisis, the second half of the year was characterised by low pulp inventories at producers as well as buyers. In particular, robust demand in China contributed to the stronger balance on the pulp market and the strengthening of Södra Cell’s profit in the second half-year.

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