Displaying items by tag: södra

Södra's operating profit for 2015 increased to SEK 2,162 million (1,516) and the Board proposes a profit distribution of SEK 1,002 million (553) to members. At the same time, Södra's investment programme will continue and an additional SEK 1 billion will be invested in the pulp mill at Mörrum.

"2015 was another good year for Södra and it is pleasing to report an historically strong result of SEK 2,162 million (1,516) and that the Board can therefore propose such substantial dividends. The forest economy was stable, our production volumes were high, exchange rates were favourable and our operations became more efficient. However, 2016 will prove a challenging year with the start-up of a virtually new pulp mill, the continuation of a change programme for sawn and planed timber, and a fragile global market," says Lars Idermark, President and CEO.

"We now have a leading and highly efficient mill operation that secures markets for our owners' forest raw material, as well as the Group's long-term potential to be successful in global competition. We will now invest an additional SEK 1 billion in our pulp mill at Mörrum to meet customer demands for high-grade pulp," says Lars Idermark.

Net sales for 2015 increased to SEK 18.3 billion (17.3), of which SEK 6.1 billion (5.9) was generated in the third four-month period. Operating profit in the third four-month period totalled SEK 502 million (504).

Due to this positive result, the Board proposes a profit distribution of SEK 1,002 million (553) to members, corresponding to 48 percent of profit before tax. The distribution comprises a dividend of 15 percent (6) on contributed capital, totalling SEK 439 million (170), a dividend of 10 percent (8) on wood deliveries, totalling SEK 436 million (323), and SEK 127 million (60) as a bonus issue. In addition to the above, a dividend of SEK 10 million (10) will be paid on subordinated debentures as contracted.

Södra already has an ongoing investment programme of about SEK 5 billion, most of which pertains to the expansion of the Värö pulp mill. The Board of Södra has now decided to invest a further SEK 1 billion in the mill at Mörrum. This investment will include a new evaporator and modernisation of the brown stock washing system in the dissolving pulp line, where pulp for the textile industry is produced. A new evaporator will make it possible to increase the production rate, as well as deliveries of energy products, such as electricity, district heating and biofuels. The new investment will increase production capacity by 45,000 tonnes, bringing the total production of paper and dissolving pulp at the Mörrum mill to 470,000 tonnes. Following the expansion, capacity at the Värö mill will amount to 700,000 tonnes. Capacity at Mönsterås will be 750,000 tonnes.

>> Video interview with Group President Lars Idermark

>> Read the full year-end report

On 16 February, the Board of Directors of Södra decided to invest SEK 1 billion in the pulp mill at Mörrum. The investment is the second stage of a long-term initiative at Södra Cell Mörrum, and will increase the mill's capacity by 45,000 tonnes.

"This is great news for us here at the mill, because our competitiveness and opportunities will increase. Södra's decision to invest in Mörrum is also important for the region," says Stefan Sandberg, Site Manager at Södra Cell Mörrum.

This particular investment includes a new evaporator, and a modernisation of the brown stock washing system in the dissolving pulp line, where pulp for textile uses is produced. A new evaporator will make it possible to increase the production rate, as well as deliveries of energy products, such as electricity, district heating and biofuels. The new investment will increase production capacity by 45,000 tonnes, bringing the total production of paper and dissolving pulp to 470,000 tonnes.

"The investment will allow us to meet customer demands for both paper and dissolving pulp. Our facility at Mörrum produces high-grade pulp with unique properties. We will now be able to offer higher volumes of these sought-after products to the market. In addition, dissolving pulp and paper pulp based on a renewable source are highly interesting from a climate perspective. More and more people are beginning to see the significance of finding materials that facilitate the transition toward a fossil-free society," says Stefan Sandberg.

The project will commence in spring 2016 and is scheduled for completion by November 2017.

For comments:
Stefan Sandberg, Site Manager at Södra Cell Mörrum,
+46 (0)70-638 78 78

Södra's Foundation for Research, Development and Education has now been in existence for just over 20 years. Some SEK 250 million has been allocated to the foundation since its inception in 1995 and SEK 175 million has been distributed. The result of the initiative is progress in a range of fields in the bio-based economy, including new opportunities for fossil-free products.

Approximately 150 research projects have been awarded funding since the establishment of the foundation in 1995. These projects have varied in character and scope, and have included funding for research into sustainable timber construction, the establishment of the Avancell fibre engineering centre with the aim of raising the processing value in the sulphate pulp industry, the development of machine planting of saplings and training of sniffer dogs to detect spruce bark beetle infestation. The results of the research projects have been significant, both from a societal perspective and for the forest industry.

For example, research into timber construction has enhanced the know-how required to construct tall timber buildings, thereby opening the possibility for more climate-smart housing construction. The focus of Avancell has been directed to Welfare materials from sustainable forest resources; sustainable products for textile fibres, packaging for drinks and liquid food, and personal care products, such as nappies.

"Sustainable and profitable forestry and a stable forest industry are issues for the future," says Laila Rogestedt, SVP Innovation & New Business at Södra and foundation Board member. "The fact that we have stable funding of long-term research in these fields paves the way for climate-smart products and sustainable production as well as jobs."

Issue of climate change a future trend
Laila Rogestedt believes that the year ahead will be an exciting one. The next decision regarding the allocation of funding will be made at the Board meeting in March. Over the past year, several applications have addressed the issue of the contribution of the forest to the carbon balance, and the combination of production goals and environmental goals.

"We can see a trend in recent years towards the role of the forest in the issue of climate change," says Laila Rogestedt. "It's an incredibly important issue for the future where we can make a huge contribution. It's truly exciting to be part of this development."

For comments: 
Laila Rogestedt, SVP Innovation & New Business and Foundation Board member, +46 (0)72 574 32 56

Göran Örlander, Sustainable Forestry Strategist at Södra and Chairman of the Foundation, +46 (0)70 590 94 83

Gustav Tibblin, Director of Business Development and Foundation Board member, +46 (0)70 573 49 85

Facts: The mission of the Södra Foundation for Research, Development and Education is to promote research and development of significance to forestry and forest industry operations in southern Sweden. The foundation has four board meetings each year, during which applications for funding are reviewed.

According to the aggregated results for 2015, Södra's sawmill at Värö is the largest in Sweden. In 2015, Värö produced a sawn volume of nearly 600,000 cubic metres.

Systematic work with planning, maintenance and efficiency improvements underlies the increase in production volumes. A third shift was also introduced in September 2015. The total raw material consumption is 1.2 million cubic metres.

"The type of construction timber produced at Värö is used for housing construction, for example, and is in high demand," says Anders Pålsson, Sawmill Manager.

Room for more
Production at the Värö sawmill comprises 80 percent spruce and 20 percent pine. While core markets are located in the UK and the US, the sawmill also supplies China, South Korea, Germany, the Netherlands, Belgium and Sweden. And full production capacity has not yet been reached:

"We have more capacity. Working in an industry with high demand, interested customers and strong regrowth of the raw material is positive," says Anders Pålsson. "Wood has many advantages. It absorbs CO2 throughout its entire lifetime, for example, which makes a positive contribution to the climate."

The sawmill and the pulp mill at Värö make up a combined plant, where both operations benefit from their proximity to each other. This includes environmental benefits, such as more efficient handling of bark, sawdust and chips which are converted to green energy and district heating. Both of the mill operations are electrically self-sufficient, and bark, for example, is sold for conversion to district heating.

Södra has been operating the sawmill at Värö since 1974, but the new facility was commissioned in 2011 and fully expanded in 2014. The facility has been adapted several times to increase production efficiency. And more adaptations are planned.

As production volumes increase, new opportunities and challenges are arising. And we are accustomed to taking advantage of such opportunities," says Anders Pålsson.

For comments:
Anders Pålsson, Sawmill Manager, Värö,
+46 (0)70 371 2086

Håkan Svensson, President of the Södra Wood business area,
+46 (0)457 316 00

Södra is now taking further steps to commercialise the composite material DuraPulp. A project to construct a dry-process machine has commenced, financed through a grant of EUR 2.1 million from the EU's LIFE funding programme.

The material in DuraPulp has properties that require special handling during the moulding process. The current method is wet-moulding, but to meet customer requests, Södra is now investing in a machine that can dry-mould the material.

"To be specific, this is a more efficient production process because it uses less water and less energy. The wet-mould method we are using today takes about two minutes, while dry-moulding takes two seconds. This technology will enable us to demonstrate products for high-volume markets, such as electronics and consumer packaging," says Urban Blomster, a business developer at Södra.

The first stage of the project was to procure external resources for the construction of the machine, with former partner, SWT Development in Varberg, Sweden, being selected for the assignment.

The machine is scheduled to be operational by the end of 2016.

For further questions, please contact:
Urban Blomster, business developer at Södra
Tel: +46 (0)706-837 785

Södra reported a strong earnings trend for the first eight months of the year. Operating profit rose to SEK 1,660 million (1,012), sales increased to SEK 12,186 million (11,429) and the operating margin was 14 percent (9).

“Södra is performing well. A healthy second four-month period has finished with a historically strong overall result for the Group for the period through August. This is largely due to high price levels for finished goods and mainly to a favourable currency situation – but also because Södra is becoming an increasingly efficient, innovative and value-generating Group,” said CEO Lars Idermark.

Operating profit for the second four-month period amounted to SEK 718 million (509) and sales to SEK 5,943 million (5,591), which yielded an operating margin of 12 percent (9). The improved earnings were due to positive demand for Södra’s products and a favourable currency situation.

“The Södra Cell business area continues to deliver a very strong performance. Stable and efficient production at the mills, while we are investing SEK 5 billion to increase production, is impressive. The profit trend for Södra Wood is more problematic. Efforts to improve operational efficiency are progressing well, but lower prices and weaker market conditions are putting pressure on profitability. Eventually, structural changes will also be required to improve profitability. Several minor measures have already been implemented, such as concentrating more of our business operations into fewer and larger units,” added Idermark.

Södra in brief, January-August 2015 period:

For questions, please contact:

Lars Idermark, Chief Executive Officer
Telephone: +46 470 894 35

On 22 September, the first pilot machine for manufacturing products from the ground-breaking bio-composite DuraPulp was inaugurated. With DuraPulp, Södra is able to offer a viable alternative to fossil-fuel based products.

DuraPulp is a biodegradable and renewable material that is malleable and mouldable. It can be used for a wide range of applications and sophisticated designs. The material is stable, water resistant and highly durable. DuraPulp has been developed by Södra and will now be produced on a pilot machine so that customers can trial the material for themselves for the first time.

On the threshold of the future
The inauguration represents a first step towards industrial-scale production of DuraPulp and bespoke products. Both the material and its products are very different to those made from traditional cellulose recipes and require a high level of technical expertise in the manufacturing process and technical support for customers, which Södra will provide. The foundations for a facility that can be used for technical presentations are currently being laid. It will also be made available to new customers to help their product development process.

DuraPulp is a mix of cellulose and a corn-based polymer called polylactic acid (PLA). It is completely new to the market. DuraPulp represents a potential solution to the replacement of fossil-fuel based products offering the chance to create bespoke new solutions rather than off-the-shelf options. DuraPulp is an extremely eco-friendly alternative to plastics with major potential in terms of product design, user-friendliness and durability.

A sustainable future
Södra has been working on the development of sustainable new materials to replace fossil-fuel products for some time.  While DuraPulp's  basic components are simple, the process of forming the actual material is considerably more complex. Using the right technique, the polymer melts and bonds with the cellulose, while also reinforcing the cellulose fibres.

Demo products produced with DuraPulp to date include the award-winning Parupu children's chair, exclusive packaging and industrial components.

For comments: 
Urban Blomster, Business Developer Durapulp, Södra,
Tel: +46 (0)70 -683 77 85

Press contact:
Ciccie Jisborg, Communication Strategist
E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.
Tel: +46 (0)72-581 82 59

Frida Nielsen, Communicator
E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.
Tel: +46 (0)72-245 16 70

Facts:
The project is a collaboration with the Innventia Cluster Research Programme, as well as Södra's partners SWT and James Cropper PLC.

DuraPulp has two basic components: virgin softwood fibre (long fibre) and a polymer based on corn starch, polylactic acid (PLA).

Jörgen Lindquist, born in 1965, has been appointed the new Chief Financial Officer (CFO) of Södra, a role that also includes responsibility for Purchasing and IT. He will assume this new position on 14 September, at which point he will also become a member of Group Senior Management and report to President and CEO Lars Idermark.

Jörgen Lindquistholds a degree in business administration, having studied at Växjö University and Lund University, and has extensive experience as a CFO and Vice President. He will be joining Södra from IKEA, where he has spent the past five years working as CFO and Acting Vice President of the company’s industry division Swedspan International. Prior to this role, Lindquist was responsible for IKEA’s project to establish new furniture manufacturing facilities in the U.S. He has also served as CFO and Vice President of the Axis Group and held various senior financial positions in the chemical and packaging industries.

“I look forward to starting at Södra. Södra represents many of the same values that I believe in with respect to sustainable development and corporate social responsibility, and is a well-managed forest company with an exciting journey ahead,” said Lindquist.

“I am very pleased to have recruited Jörgen to Södra. His solid background and international experience will be an asset in our continued efforts to strengthen our competitiveness, growth and long-term profitability,” commented President and CEO Lars Idermark.

Lindquist will succeed Carina Olson, who previously announced her decision to leave Södra to pursue new challenges. He will be based in Södra’s head office in Växjö.

For questions, please contact:

Lars Idermark, President and Chief Executive Officer
Telephone: +46 470 894 35

Annica Gerentz, Senior Vice President Corporate Communications
Telephone: +46 470 894 81

Södra's nursery in Flåboda has now completed the transition to fossil-free operation. In 2016, efforts will continue to convert all sapling production at Södra Skogsplantor to eliminate the use of fossil fuels at this stage of operations. "This is a major step forward in our environmental efforts to reduce CO?emissions and make us less dependent on fossil fuels," says Johan Jonsson, Head of Södra Skogsplantor.

The process to changeover Södra's nursery in Flåboda to fossil-free operation commenced three years ago. The goal has now been achieved, with boilers fuelled with vegetable oils, greenhouses heated by four pellet boilers, green electricity generated by Södra's pulp mills and vehicles that run on hydrotreated vegetable oil (HVO).

"We evaluated several products and chose HVO for our vehicles, since it generates maximum climate benefits and works well with our existing fleet of diesel vehicles. For Södra, this initiative means that our environmental profile remains firm," says Henrik Brodin, who is responsible for the Group's energy purchasing.

HVO is a synthetic diesel produced by hydrogenating plant and animal fats, mainly sourced from abattoir trimmings and rapeseed oil. The pellets used come from Södra Wood's nearby sawmill in Långasjö.

In 2016, Södra's nursery in Falkenberg will also complete the changeover to fossil-free operation.

For further questions, please Contact:
Johan Jonsson, Head of Södra Skogsplantor
Tel: +46 (0)470-893 34

Henrik Brodin, Strategic Purchaser Transport and Raw Material
Tel: +46 (0)470-856 24

Following many years of decline, Södra is now seeing a clear trend break in the proportion of Scots pine seedlings sold.

"This spring, some 1.7 million pine seedlings are being dispatched from our Flåboda Nursery, while the figure for spring 2016 is 2.5 million seedlings. In total, Södra will deliver 3.5 million pine seedlings this year, which is up about two million on the low point," says Ida Karlsson, Manager at Flåboda Nursery.

For a period of five years, Södra has been strongly committed to increasing the proportion of pine in the forests of southern Sweden. The results from last year's moose-grazing inventory showed that pine sites are poorly planted or use incorrect tree species.

In a future with expected climate change and increased risk of drought, the decline of the Scots pine tree in Götaland entails a major risk.

Spruce, which is increasingly being planted on pine sites, risks being affected by water shortages, nutritional deficiencies and damage due to drought. A crucial reason for planting spruce on Scots pine sites are a poor balance between the availability of fodder and supplies of moose and deers game. Today, pine sites account for 20 percent of the land, while only 10 percent is rejuvenated with pine. A few years ago, sales of pine seedlings were down at a level of 5 percent.

"Södra's Flåboda and Falkenberg nurseries are prepared to further increase production if so requested by the forest owners. At Flåboda, we can double pine production," says Ida Karlsson.

To effect a change in relation to the proportion of pine, Södra has become involved in numerous ways, including in wildlife management, the Mera tall- project and Viltstammar i Balans projects and, above all, in the moose-grazing inventory (ÄBIN).

"With this increase in pine seedling sales, we can now see the results of this work. There is a prospect of once again rejuvenating Scots pine forests and the forest owners are showing confidence in wildlife management. And it is important that we work together to foster this confidence. We can do so by ensuring the continued development of Scots pine rejuvenation through effective wildlife management," says Göran Örlander, Head of the Silviculture Department at Södra.

To find out more, please contact:
Göran Örlander, Head of the Silviculture Department at Södra, 
Tfn: +46 (0)470-893 62
Ida Karlsson, Manager, Flåboda Nursery 
Tfn:  +46 (0)477-451 60