EQS-News: Mayr-Melnhof Karton AG: MM reports results for the first three quarters of 2023

EQS-News: Mayr-Melnhof Karton AG / Key word(s): Quarter Results
   Mayr-Melnhof Karton AG: MM reports results for the first three quarters of
   2023

   07.11.2023 / 08:00 CET/CEST
   The issuer is solely responsible for the content of this announcement.

   ══════════════════════════════════════════════════════════════════════════

     • 3Q operating profit above previous quarter but well below previous
       year
     • Solid performance at MM Packaging
     • Market- and capex-related volume decline continued to weigh on results
       of MM Board & Paper
     • General conditions remain tight as a result of inflation-related
       consumption restraint and the macroeconomic slowdown
     • No immediate recovery in sight
     • Initiated profit and cash protection program begins to take effect

   Group Key indicators - IFRS

   Consolidated, in millions of EUR 1-3Q/2023 1-3Q /2022     +/-
   Sales                              3,196.5    3,450.4  -7.4 %
   EBITDA                               328.0      591.2 -44.5 %
   Operating profit                     159.8      452.2 -64.7 %
   Operating margin (in %)              5.0 %     13.1 % -810 bp
   Profit before tax                    118.9      416.8 -71.5 %
   Profit for the period                 91.2      315.2 -71.1 %
   Earnings per share (in EUR)           4.50      15.67        

   Peter Oswald, MM CEO, comments: “After the record year 2022, the MM Group
   has been operating for several quarters in a market environment with
   significantly reduced demand in the paper and board industry and
   increasing price pressure. Although destocking in the supply chain seems
   to be coming to an end in many places, restraint in consumer spending
   continues due to inflation and as a result of the overall economic
   slowdown in our main European markets.”

   As expected, the difficult general conditions are also reflected in the
   3^rd quarter, in particular in the weak volume and result development of
   the division MM Board & Paper, which was again characterized by planned
   capex-related downtime in addition to significant market-related downtime.
   In contrast, the division MM Packaging recorded an overall solid
   performance despite a heterogeneous packaging market as well as the
   successful integration of last year's acquisitions in the resilient area
   of pharmaceutical packaging.

   In view of the current market and result situation and the prospect of no
   improvement in the short term, our focus is on safeguarding and gaining
   volumes with reasonable margins. Our profit and cash protection program,
   which in addition to cost reductions in all areas targets on a significant
   reduction in working capital and capex cash outs, starts to take effect
   and will be supplemented by selected structural adjustment measures.

   “Due to our continuous efforts to expand our competitiveness and quality
   leadership as well as the recent strategic investments in our plants and
   sustainable, innovative packaging products, MM is very well positioned to
   manage the current difficult market situation and to create long-term
   added value for our customers and shareholders.”, underlines Oswald.

   INCOME STATEMENT
   At EUR 3,196.5 million, the Group's consolidated sales were below the
   previous year’s figure (1-3Q 2022: EUR 3,450.4 million). A primarily
   volume-related decline in the division MM Board & Paper contrasted with an
   acquisition- and price-related increase in the division MM Packaging.

   Operating profit decreased by EUR 292.4 million from EUR 452.2 million to
   EUR 159.8 million. This decline mainly results from extensive market- and
   capex-related downtime at MM Board & Paper. The Group’s operating margin
   was therefore at 5.0 % (1-3Q 2022: 13.1 %).

   Financial income amounted to EUR 5.4 million (1-3Q 2022: EUR 3.1 million).
   The increase in financial expenses from EUR -23.3 million to EUR -40.0
   million is primarily due to higher interest expenses for
   Schuldscheindarlehen and financing of the accomplished acquisitions and
   organic growth projects. “Other financial result - net” changed from EUR
   -15.2 million to EUR -6.3 million, in particular owing to currency
   translation.

   Profit before tax was EUR 118.9 million after EUR 416.8 million in the
   previous year. Income tax expense amounted to EUR 27.7 million (1-3Q 2022:
   EUR 101.6 million), resulting in an effective Group tax rate of 23.3 %
   (1-3Q 2022: 24.4 %).

   Thus, profit for the period decreased from EUR 315.2 million to EUR 91.2
   million.

   DEVELOPMENT IN THE 3^RD QUARTER
   As expected, business development in the 3^rd quarter continued at a
   similar level as in the previous quarter. Due to further market and
   capex-related downtime in the division MM Board & Paper as well as
   heterogeneous demand in the sales markets of MM Packaging and increasing
   price pressure, consolidated sales amounted to EUR 1,015.1 million after
   EUR 1,059.3 million in the 2^nd quarter of 2023 and EUR 1,231.9 million in
   the 3^rd quarter of the previous year.

   The Group's operating profit of EUR 55.8 million was above the previous
   quarter (2Q 2023: EUR 42.4 million) due to a strong profit contribution
   from MM Packaging, but well below the previous year's level (3Q 2022: EUR
   167.2 million). The operating margin came in at 5.5 % (2Q 2023: 4.0 %; 3Q
   2022: 13.6 %). Profit for the period amounted to EUR 27.9 million (2Q
   2023: EUR 28.4 million; 3Q 2022: EUR 109.4 million).

   The operating margin of the division MM Board & Paper was -3.0 % (2Q 2023:
   -2.0 %; 3Q 2022: 15.6 %) mainly due to market-related reduced capacity
   utilization as well as capex downtime at the Slovenian Kolicevo board
   mill.

   MM Packaging's operating margin reached 11.4 % particularly as a result of
   declining cartonboard prices (2Q 2023: 8.6 %; 3Q 2022: 9.2 %).

   OUTLOOK
   Weak demand in the cartonboard and paper sector continues in almost all
   areas, as higher costs of living reduce general demand for consumer goods
   and the overall economic market environment remains uncertain. There is
   currently no sign of a market recovery, but the bottom seems to have been
   reached and destocking in the supply chain largely completed. Against this
   background and in view of sufficient capacities in the industry,
   significant machine downtime will continue to be necessary – at least also
   in the 4^th quarter – in order to adjust production to market demand. This
   will primarily impact the division MM Board & Paper.

   Under these tightened general conditions, MM is focusing on safeguarding
   and gaining volume with reasonable margins. Our profit and cash protection
   program, which in addition to cost reductions in all areas aims at a
   significant reduction of working capital and capex cash-outs, will be
   consistently pursued and implemented as well as supplemented by targeted
   structural adjustment measures. Overall, the pressure to enhance
   competitiveness is steadily increasing.

   Our primary focus remains on recovering margins as quickly as possible and
   reducing net debt. With sustainable and innovative packaging solutions, MM
   is very well positioned to successfully manage the current difficult
   market situation.

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

   Please find the detailed Press Release and the Report for the first three
   quarters of 2023 as well as the CEO Audio-Q&A-Webcast on our website:
   https://www.mm.group.

   Forthcoming results:
   March 12, 2024   Financial Results for 2023

   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: [email protected], Website: https://www.mm.group

   ══════════════════════════════════════════════════════════════════════════

   07.11.2023 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:      [email protected]
   Internet:    www.mm.group
   ISIN:        AT0000938204
   WKN:         93820
   Indices:     ATX
   Listed:      Regulated Unofficial Market in Berlin, Frankfurt (Basic
                Board), Munich, Stuttgart, Tradegate Exchange; Vienna Stock
                Exchange (Official Market)
   EQS News ID: 1766079


    
   End of News EQS News Service


   1766079  07.11.2023 CET/CEST

OTS-ORIGINALTEXT PRESSEAUSSENDUNG UNTER AUSSCHLIESSLICHER INHALTLICHER VERANTWORTUNG DES AUSSENDERS - WWW.OTS.AT |

print