1st quarter results

Sappi is a global diversified woodfibre company focused on providing dissolving wood pulp, packaging and speciality papers, printing and writing papers as well as biomaterials and biochemicals to our direct and indirect customer base across more than 150 countries.

Q1 2019

Financial results conference call

Our dissolving wood pulp products are used worldwide mainly by converters to create viscose fibre for fashionable clothing and textiles, as well as other consumer products; quality packaging and speciality papers are used in the manufacture of such products as soup sachets, luxury carry bags, cosmetic and confectionery packaging, boxes for agricultural products for export, tissue wadding for household tissue products and casting release papers used by suppliers to the fashion, textiles, automobile and household industries; our market-leading range of printing and writing papers are used by printers in the production of books, brochures, magazines, catalogues, direct mail and many other print applications; biomaterials include nanocellulose, fibre composites and lignosulphonate; biochemicals include second generation sugars.

The wood and pulp needed for our products are either produced within Sappi or bought from accredited suppliers. Sappi sells almost as much as it buys.

Sales by source* (%)

Sales by product* (%)

Sales by destination* (%)

Net operating assets** (%)

* For the period ended December 2018. ** As at December 2018.

Highlights for the quarter

EBITDA excluding special items
US$197 million
(Q1 2018 US$172 million)

EPS excluding special items
16 US cents
(Q1 2018 14 US cents)

Profit for the period
US$81 million
(Q1 2018 US$63 million)

Net debt
US$1,557 million
(Q1 2018 US$1,349 million)

Commentary on the quarter

In a difficult operating climate, the resilience of the business and the benefits from the diversification of the product portfolio in recent years were emphasised during the quarter. Profitability was in line with the guidance provided at the end of the 2018 financial year and the group generated EBITDA excluding special items of US$197 million, a 15% improvement compared to the equivalent quarter last year. Profit for the comparative period increased by 29% to US$81 million due to the improved operating profit and a lower tax charge for the quarter.
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