Comments to the multi-year summary
In 2008, sales increased 4%. SCA’s European packaging operations were reclassified to Disposal group held for sale with retroactive adjustment from 2010. Sales declined 24% in 2010 mainly due to the reclassification of the European packaging operations, but also to negative exchange rate effects and the divestment of the Asian packaging operations. Net sales in 2011 fell 2%. A number of strategic acquisitions and divestments were carried out in 2012, including the acquisition of Georgia-Pacific’s European tissue operations and the divestment of SCA’s European packaging operations. Net sales for 2012 rose 5%. In 2013, SCA divested its publication paper mill in Laakirchen, Austria, as well as the areas of Georgia-Pacific’s European tissue operations which the European Commission ordered SCA to divest in conjunction with the acquisition in 2012. Net sales increased 4%. The Chinese hygiene products company Vinda has been consolidated as of 2014. Net sales rose 12% in 2014. In 2015, net sales increased 11%, of which organic sales growth accounted for 5%.
Profit for Personal Care improved in 2007. Operating profit was stable in 2008 and increased 11% in 2009. Profit declined in 2010. Higher volumes and lower costs failed to offset increased costs of raw materials, marketing activities and negative exchange rate effects. Operating profit for 2011 declined 5% excluding exchange rate effects compared with the preceding year. Higher volumes, prices and cost savings did not offset higher costs of raw materials. In 2012, operating profit rose 20% compared with the preceding year. The earnings improvement was attributable to higher volumes and prices, an improved product mix, lower raw material costs and cost savings. In 2013, profit increased 1%. Earnings were impacted positively by higher volumes, cost savings and acquisitions. Investments in increased market activity resulted in higher volumes, but impacted earnings, particularly in the area of diapers. Increased raw material costs and negative exchange rate effects had an adverse impact on profit. Operating profit for 2014 was in line with the preceding year. Higher volumes, an improved price/mix and cost savings had a positive impact on earnings, while higher raw material costs and investments in market activity had an adverse impact on earnings. In 2015, operating profit increased 13%, with higher volumes and an improved price/mix offsetting higher raw material costs and increased investments in market activities.
The Tissue operations experienced a number of years of lower prices, higher raw material and energy costs, and negative exchange rate effects. In 2007, this negative trend was reversed and operating profit increased. As of the fourth quarter of 2007, the acquisition of Procter & Gamble’s European tissue unit is included in SCA’s Tissue operations. In 2008, the profit level increased mainly as a result of acquisitions and higher prices and volumes. In 2009, the profit level increased as a result of higher prices and lower costs for raw materials. In 2010, profit declined for Tissue compared with the preceding year, due to a sharp increase in costs for raw materials. Operating profit for 2011 rose 4%. Higher prices, a changed product mix and increased volumes had a positive impact, while higher raw material and distribution costs combined with negative exchange rate effects had an adverse impact on profit. In 2012, operating profit increased 47%. Higher prices, an improved product mix, increased volumes, acquisitions, lower raw material costs and cost savings contributed to the improvement in earnings. Profit for 2013 rose 21%. The improvement in earnings was due to acquisitions, increased volumes and cost savings. In 2014, operating profit increased 16% as a result of higher volumes, an improved price mix, cost savings and the acquisition of the Chinese company Vinda. In 2015, operating profit rose 8%. Higher volumes, an improved price/mix and cost savings compensated for the higher costs for raw materials, which were primarily the result of the stronger USD.
Packaging implemented price increases in 2007. SCA sold its North American packaging operations in 2007. Operating profit declined sharply in 2008 due to the financial crisis and the ensuing recession. The recession continued in 2009 and the result from Packaging declined 72%. The Asian packaging operations were divested in 2010. In 2012, the European packaging operations were divested and reclassified to Disposal group held for sale with retroactive adjustment from 2010.
Forest Products’ earnings improved until 2007. The earnings improvement was mainly an effect of higher prices. In 2008, profit declined due to increased energy and raw material costs. In 2009, profit improved, primarily for publication papers, an area in which higher prices, lower raw material costs and efficiency enhancements made a positive contribution. Profit increased 16% in 2010 due to productivity improvements and implemented price increases in pulp and solid-wood products. Profit declined in 2011, primarily as a result of higher costs for raw materials and negative exchange rate effects. In 2012, operating profit declined, mainly due to lower prices and negative exchange rate effects due to the stronger SEK. The Austrian publication paper mill in Laakirchen was divested in 2013. Profit increased 35% due to cost savings, lower raw material costs and profit from forest swaps. In 2014, profit rose 36% as a result of higher prices (including exchange rate effects), increased volumes, lower energy costs and cost savings. In 2015, profit increased 4%, or 17% excluding profit from forest swaps.
Cash flow statement
A total of SEK 50bn has been invested in expansion during the reported ten-year period, of which SEK 29bn is attributable to company acquisitions. Maintenance investments amounted to SEK 41bn and have remained at a steady level of about 4% in relation to sales.
During the reporting period, the Group’s dividend rose from SEK 4.00 to the proposed SEK 5.75, corresponding to an average annual increase of approximately 4.6%. The proposed dividend of SEK 5.75 per share corresponds to an increase of 9.5% compared with the preceding year.