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Suominen Corporation's interim report for January 1 - March 31, 2015: Solid performance continued - net sales, operating profit and cash flow from operations strenghtened


Highlights in January – March 2015:

- Net sales increased by 13.8% and amounted to EUR 111.9 million (98.4).
- Operating profit excluding non-recurring items increased by 14.2% to EUR 7.3 million (6.4).

- Cash flow from operations increased to EUR 4.5 million (-0.4).
- Suominen announced its plans to execute an investment in a new production line in North America. If the planning process proceeds as expected, the location of the manufacturing line would be Suominen’s plant in Bethune, South Carolina, USA.
- Suominen repeats its previous estimate, disclosed on 30 January 2015, that for the full year 2015 the company expects its net sales and operating profit excluding non-recurring items to improve from year 2014. In 2014, Suominen’s net sales amounted to EUR 401.8 million and operating profit excluding non-recurring items to EUR 26.9 million.

President & CEO Nina Kopola comments on Suominen’s first quarter of 2015:

“The marked increase of the consumer confidence index of the euro area in the first quarter proves that, in Europe, consumers are more confident with the general economic situation. In the U.S., the average consumer confidence index continued to develop favorably in the first quarter, but by the end of March it was lower than it was at the start of the year. Europe and North America are Suominen’s largest market areas.

Suominen had a favorable start to 2015. The company’s net sales grew 14% on the comparison period, totaling EUR 111.9 million. The growth in net sales was primarily attributed to the weakening of our reporting currency, the euro, in relation to the U.S. dollar. The demand in the European markets improved from the comparison period, but competitive environment remained fierce.

Suominen’s operating profit improved 14% on the comparison period and stood at EUR 7.3 million. The net sales growth as well as the strengthening of the U.S. dollar both had an impact on the operating profit. I am particularly pleased with Suominen’s strong cash flow. Our January–March cash flow from operations, which in recent years has been negative, was EUR 4.5 million (-0.4) this year.

In January, we announced the largest single project in our EUR 30–50 million investment program. We plan to invest in a new wetlaid production line in our Bethune plant in SC, the United States. Realization of the project would support not just the growth target set for the 2015–2017 strategy period, but also our intention to further increase the share of value-added products in our portfolio. We have not yet made the total value of the investment public. Also the investments in our plants in Brazil, Spain and Finland, that were announced earlier, proceed in accordance with our plans.

Together with growth, we aim to achieve product leadership in our industry. We took several steps towards this vision through launching three new nonwoven products in the markets in the first quarter of the year. Fibrella™ Perf Spunlace is targeted at the South American medical market, specifically for wound care and surgical applications. An investment in the Paulínia plant in Brazil announced late last year will make local production of the products possible. Fibrella™ Lite Spunlace, an especially light nonwoven, is designed primarily for the global hygiene products market, for diaper and incontinence products, for example. Both Fibrella product launches support the growth targets of our Care business area.

We additionally introduced our Hydraspun® Dispersible Plus nonwoven to the growing global flushable wipes market. The new Hydraspun® Dispersible Plus nonwoven disperses in water more than three times faster than its predecessor, Hydraspun® Dispersible. Suominen has filed a patent application for the product.”

Click to open the full interim report release (pdf)