1
Highlights 1st Half 2016 (vs. H1 2015)Record paper sales, measured in tons and euros
EBITDA up 5.8% to € 195.3 million, and EBITDA/Sales margin improves to 25.1%
Strong operating performance, with growth in sales volume for paper (+3.7%), pulp (+9.6%) and tissue (+32.8%)
Energy business records decrease in sales with application of new tariffs and switch to self- consumption (reduction in turnover of € 38.4 million).
Investment in pellets mill in US nearing completion: production trials under way with continuous operation due to start up on 22 August.
Net debt evolves as expected with Net Debt/EBITDA ratio kept within comfortable levels
IFC confirms its intention to take up 20% stake in Portucel Moçambique
Highlights: 2nd Quarter 2016 (vs. Q1 2015)Sound performance in the quarter, with turnover at € 394 million
Dividend of € 170 million paid in May, representing yield of 8.4% (in relation to listed share price at 24/05/2016)
Fire at tissue mill in Vila Velha de Rodão in early May with no relevant impact
Repayment of € 150 million on high yield bond issue with fresh borrowing contracted at lower cost and with longer maturities
Installation of Portugal's largest solar power facility on an industrial site at the Setúbal paper mill
Summary of Leading Indicators - IFRS (unaudited figures)in million euros
H1 2016
H1 2015
% Change H1 16/H1 15
Total sales
778.6
794.9
-2.1%
EBITDA (1)
195.3
184.5
5.8%
Operating profits
107.9
129.7
- 16.8%
Financial results
- 13.5
- 17.8
- 24.6%
Net earnings
85.5
100.5
-14.9%
Cash flow
172.8
155.3
17.5
Free Cash Flow (2)
31.3
46.9
- 15.5
Capex
75.3
77.2
- 1.9
Net debt (3)
793.2
558.6
23459.0%
EBITDA / Sales (%)
25.1%
23.2%
1.9 pp
ROS
11.0%
12.6%
- 1.7 pp
ROE
14.6%
15.0%
- 0.4 pp
ROCE
11.4%
14.7%
- 3.3 pp
Equity ratio
46.2%
49.6%
- 3.4 pp
Net Debt / EBITDA (4 )
1.98
1.57
1.26
in million euros
Q2 2016
Q1 2015
% Change Q2 16/Q1 16
Total sales
394.0
384.6
2.5%
EBITDA (1)
101.8
93.5
8.8%
Operating profits
51.5
56.4
- 8.7%
Financial results
- 10.7
- 2.7
295.7%
Net earnings
40.7
44.7
-8.9%
Cash flow
91.0
81.8
0.1
Free Cash Flow (2)
13.3
18.0
- 4.8
Capex
26.3
49.0
- 22.7
Net debt (3)
793.2
636.4
156.7
EBITDA / Sales (%)
25.8%
24.3%
1.5 pp
ROS
10.3%
11.6%
- 1.3 pp
ROE
13.7%
14.5%
- 0.7 pp
ROCE
10.8%
12.0%
- 1.2 pp
Equity ratio
46.2%
51.2%
- 5.0 pp
Net Debt / EBITDA (4 )
1.98
1.58
1.25
Operating profits + depreciation + provisions
Var. Net debt + dividends + purchase of own shares
Interest-bearing net debt - liquid assets
EBITDA corresponding to last 12 months
The Navigator Company recorded sound performance during the first half of 2016, with turnover totalling € 778.6 million. Outstanding performance in the Group's traditional pulp and paper business resulted in its best ever first half figures for both the volume and value of paper sales. At the same time, turnover was down by 2.1% in relation to the first half of 2015 due to a reduction in the value of power sales, caused by the downwards revision of the tariff paid by the national grid for power from the Figueira da Foz cogeneration plant.
In the European market for uncoated woodfree printing and writing paper (UWF), a significant reduction in production capacity allowed capacity utilization rates in the industry to rise strongly. At the same time, exports fell and imports into the European market increased, in particular from Asia, whilst estimates point to a reduction in apparent consumption of approximately 2%. In this context, the Group recorded sales of 775.5 thousand tons, its highest ever figure for the first half of the year, up by 3.7% on its sales volume in H1 2015. The Group increased its European sales at the same time as achieving significant growth in sales to international markets. The European A4 copy B price index performed well (up 2.3%), whilst Navigator's average price for all markets edged downwards, due essentially to foreign exchange factors, concerning sterling in particular, and negative trends in the product mix.
The first half proved more difficult in bleached eucalyptus pulp (BEKP) business, where sales prices have been falling since late 2015. Navigator nonetheless recorded strong operating performance: figures for the volume of pulp placed on the market point to a rise of 10% in sales, thanks to the capacity expansion at the Cacia mill, which has resulted in increased availability of pulp for the market. The downturn in the pulp market, where the BHKP PIX index dropped 13% in dollars and 15% in euros, was also reflected in the Group's average sales price: in terms of value, sales grew by only 3%.
The Group is currently conducting pre-feasibility studies to increase pulp capacity at the Figueira da Foz mill, in order to reach 650 thousand tons of output per year. Preliminary studies are at an advanced stage but the execution of the investment is depending on the verification of a series of
The Navigator Company published this content on 26 July 2016 and is solely responsible for the information contained herein.
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