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MAYR-MELNHOF KARTON AG (FRA:MYM) EQS-News: Mayr-Melnhof Karton AG: MM reports results for the first three quarters of 2022

Directive transparence : information réglementée

03/11/2022 08:00

EQS-News: Mayr-Melnhof Karton AG / Key word(s): Quarter Results
Mayr-Melnhof Karton AG: MM reports results for the first three quarters of 2022

03.11.2022 / 08:00 CET/CEST
The issuer is solely responsible for the content of this announcement.


  • Solid performance also in the 3rd quarter
  • Growth strategy for Packaging executed
  • Preserving profitability – priority in a slowing overall economy

Group Key indicators - IFRS

Consolidated, in millions of EUR 1-3Q/2022 1-3Q /2021 +/-
Sales 3,450.4 2,107.1 +63.7 %
EBITDA 591.2 283.0 +109.0 %
Operating Profit 452.2 177.2 +155.2 %
Operating margin (in %) 13.1 % 8.4 % +470 bp
Profit before tax 416.8 162.4 +156.7 %
Profit for the period 315.2 128.4 +145.4 %
Earnings per share (in EUR) 15.67 6.37  

Peter Oswald, MM CEO, comments: "The MM Group recorded organic growth of nearly 6 % in Packaging in the first three quarters. This demonstrates that demand for our natural, recyclable products from renewable fibers stayed high and that customers esteem our investments in competitive sites, innovation and sustainability.

The acquisition of Essentra Packaging, finalized at the beginning of October, marked a further milestone in the past two years transformation of MM concentrating on value enhancing acquisitions and focused organic growth combined with a strong emphasis on the improvement of productivity. This acquisition positions MM as a global player in secondary pharma packaging and contributes to more resilience and growth throughout our business.

Performance in the 3rd quarter remained strong, although behind the exceptional high level of the 2nd quarter, which allowed for an important rise in results for the first three quarters of 2022 in a very challenging cost and operating environment.

We continued to mitigate significant cost inflation through price adjustments, cost control and efficiency gains. Moreover, the inclusion of the cartonboard and paper mills MM Kwidzyn and MM Kotkamills, which we acquired at the beginning of August 2021, had a particular impact on the income statement. While Packaging registered an ongoing solid order intake, the order backlog of Board & Paper saw a significant reduction throughout the 3rd quarter towards a pre-pandemic level due to the filled supply chain. This required selective temporary downtime aside the rebuilding work for the production of more Absorbex® from MM Kotkamills. Despite recurring bottlenecks on our procurement markets, we managed to keep up a steady supply of our customers.

For the 4th quarter, we expect impacts from necessary adjustment measures and ongoing selective temporary downtime in the Board & Paper division. Although a recessionary scenario must be assumed for the economy as a whole, most of our business areas are expected to set forth a rather robust development despite further destocking in the supply chain filtering through. In the current rapidly changing environment safeguarding of profitability stays our top priority." 

INCOME STATEMENT

The income statement as of the first three quarters is particularly characterized by the inclusion of the cartonboard and paper mills MM Kwidzyn and MM Kotkamills, which were acquired at the beginning of August 2021.

The Group’s consolidated sales amounted to EUR 3,450.4 million and were EUR 1,343.3 million above the previous year’s value (1-3Q 2021: EUR 2,107.1 million). This rise mainly results from the previous year’s acquisitions and passing on cost increases through higher prices.

At EUR 452.2 million, an operating profit EUR 275.0 million above the previous year’s value was reached (1-3Q 2021: EUR 177.2 million). The significant rise primarily results from the division MM Board & Paper. The Group's operating margin thus rose to 13.1 % (1-3Q 2021: 8.4 %).

Financial income totaled EUR 3.1 million (1-3Q 2021: EUR 1.9 million). The increase of financial expenses from EUR -16.8 million to EUR -23.3 million is in particular due to the issuance of Schuldschein loans and Namensschuldverschreibungen in the previous year to finance the acquisitions and organic growth projects. "Other financial result – net" changed from EUR 0.1 million to EUR -15.2 million, in particular owing to currency translation.

Accordingly, profit before tax, at EUR 416.8 million, was EUR 254.4 million above the previous year’s value (1-3Q 2021: EUR 162.4 million). Income tax expense amounted to EUR 101.6 million (1-3Q 2021: EUR 34.0 million), resulting in an effective Group tax rate of 24.4 % (1-3Q 2021: 20.9 %).

Profit for the period rose by EUR 186.8 million to EUR 315.2 million after EUR 128.4 million in the first three quarters of the previous year.

DEVELOPMENT IN THE 3RD QUARTER

In the course of continuous strong demand throughout most of the quarter and only selective necessary downtime at Board & Paper towards the end of the quarter as well as further price increases to compensate for the ongoing strong cost inflation consolidated sales of EUR 1,231.9 million were above the previous quarter’s value (EUR 1,158.1 million). The increase compared to the previous year’s level (3Q 2021: EUR 817.5 million) results primarily from the inclusion of MM Kotkamills and MM Kwidzyn as well as necessary price adjustments.

At EUR 167.2 million, the Group's operating profit was below the 2nd quarter of 2022 (EUR 173.9 million) but above the value of the 3rd quarter of the previous year (EUR 85.1 million). The latter was mainly characterized by the income from the sale of the Eerbeek and Baiersbronn mills in the amount of EUR 50.1 million and by one-off expenses from the acquisition of the mills Kwidzyn and Kotkamills in the amount of EUR 31.9 million. The operating margin amounted to 13.6 % (2Q 2022: 15.0 %; 3Q 2021: 10.4 %). Profit for the period reached EUR 109.4 million (2Q 2022: EUR 126.3 million; 3Q 2021: EUR 66.2 million).

Capacity utilization of the division MM Board & Paper at 91 % in the 3rd quarter was lower than in the previous quarter (2Q 2022: 99 %; 3Q 2021: 95 %), mainly due to planned maintenance shutdowns and selective market-related downtime. The operating margin amounted to 15.6 % (2Q 2022: 18.1 %; 3Q 2021: 9.5 %).

The 3rd quarter in the packaging division was mainly characterized by volume increases and implemented cost passes. In addition, one-off ancillary acquisition costs for the purchase of Essentra Packaging had to be recognized. The operating margin was at 9.2 % (2Q 2022: 8.4 %; 3Q 2021: 10.4 %).

OUTLOOK

Against the backdrop of a looming recession, we expect selective downtime measures to continue, predominantly in Board & Paper due to further destocking. However, our end markets are resilient and non-cyclical since they are focusing on products of daily needs.

In the current rapidly changing environment, we place top priority on preserving profitability while closely following up on necessary structural adjustment measures for more efficiency, sustainability and innovation. In the 4th quarter a particular focus has been directed on the planned reorganization of production at the Slovenian MM Kolicevo mill to concentrate production from the small board machine 2 on the larger and advanced board machine 3 which is strengthened by significant current investments. For the acquisition of Essentra Packaging, the positive contribution from the current result is expected to be offset by one-off expenses from the initial consolidation.

As already indicated, capex for the Group will be on a high level also in 2023 in order to reduce energy consumption, raise quality and increase output. In Board & Paper all machine rebuilds, which are an integral part of the current major investment programs, at Frohnleiten in Austria, Neuss in Germany and Kolicevo in Slovenia are now scheduled for implementation during 2023. In Packaging top priority is the post merger integration of Essentra Packaging while major capex will focus on expansions for further specializations in Poland and France. Intended improvements, optimization of the product portfolio as well as expansive effects will gradually take effect from 2024 onwards. Looking forward, we aim to increase the share of renewable energies and to expand further in order to meet the growing demand for innovative, sustainable fiber-based packaging. Although 2023 will most likely be a difficult year, we are well positioned to further develop our business.

-----------------------------

Please find the detailed Press Release and the Report for the first three quarters of 2022 as well as the CEO Audio-Q&A-Webcast on our website: https://www.mm.group. 

 

For further information, please contact:
Stephan Sweerts-Sporck, Investor Relations, Mayr-Melnhof Karton AG,
Brahmsplatz 6, A-1040 Vienna
Tel.: +43 1 501 36-91180,
E-Mail: investor.relations@mm.group, Website: https://www.mm.group



03.11.2022 CET/CEST This Corporate News was distributed by EQS Group AG. www.eqs.com


Language: English
Company: Mayr-Melnhof Karton AG
Brahmsplatz 6
1040 Wien
Austria
Phone: 0043 1 501 36 91180
Fax: 0043 1 501 36 91391
E-mail: investor.relations@mm.group
Internet: www.mm.group
ISIN: AT0000938204
WKN: 93820
Indices: ATX
Listed: Regulated Unofficial Market in Berlin, Frankfurt (Basic Board), Munich, Stuttgart; Vienna Stock Exchange (Official Market)
EQS News ID: 1477671

 
End of News EQS News Service

1477671  03.11.2022 CET/CEST

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