Operating revenues came to NOK 8,122 (8,060) million for the year as a whole. The profit for the year after interest and tax was minus NOK 47 (minus 86) million.
Difficult times in Europe
These unsatisfactory figures in 2012 are primarily the result of the challenging market conditions for the Group's sawmill division and considerable losses linked to a number of major projects in Moelven Elektro. The poor results achieved by Moelven's sawmills operations are due to low building activity in large parts of Europe. This has led to low market prices. In addition, the weakness of the euro in the second half of the year has contributed to reduced profitability in the export-oriented sawmills.
Hans Rindal, CEO of Moelven Industrier ASA, reports that the first half of the year was better than the second half, and that the net result was close to zero for Moelven – with a small profit from operations, but a loss after interest and tax. The Building Systems division returned good results, primarily from modules, system interiors and laminated wood, which help counteract the loss in Elektro. Combined with an operating profit for the building products division Wood, this yields a profit from operations for the Group as a whole.
"I am largely pleased with the way we are coping with the low international demand and increased competition at home, as a result of the sovereign debt crisis in Europe. However, we must do even better in the future, and adaptations take time. By contrast, I am not pleased about the problems we have brought upon ourselves. Elektro has projects that we are not able to finish properly, and a number of new investments in other parts of the Group are taking too long to yield positive results," says Rindal.
Better on the home front
The main dividing line for Moelven in 2012 is between the companies that primarily sell on the domestic markets in Norway and Sweden and the companies that depend on exports. The units with mostly domestic customers did best, although there are exceptions in both groups.
Rindal explains that some parts of Moelven's operations are going very well, and he promises that the Group will improve its performance in the long term.
"In the first quarter 2013, we will return a loss, but after that we expect to start seeing positive results from many of the areas we are currently working on and are able to influence. We have to accept that there will always be economic upturns and downturns. The last time we were in a similar position was during the financial crisis in 2008/09. Back then our employees took the initiative and made the changes that were necessary, and were ready when demand picked up again. That is what we will do this time too," says Rindal.
No debt crisis
He does not believe that the debt crisis in Europe will result in a debt crisis for Moelven.
"No. Even with the results we achieved in 2012, we ended the year with almost the same balance and equity as we started it with. We have the same long-term financing arrangements, which proved to be robust enough during the financial crisis in 2008/09, and which are designed to tolerate the changes we will have to make now too," Rindal explains.
Rindal wants to complete the investments that have been started, but will not embark on major new projects.
"That will help improve our cash flow. In addition, we are concentrating our efforts on getting the companies we already own to run more smoothly. Capacity will be slightly reduced in a number of areas, and we will cut costs by means of continuous improvements. We will use these challenging times to become even better at what we do," says Rindal.
For further information please contact:
CEO Hans Rindal, +47 906 96 910
Financial Director Morten Sveiverud, +47 909 80 667
Ass. Financial Director Rune F. Andersen, +47 91343260
Communications and HR Director Kristin Bjørnstad, +47 90713701
Communications Officer Tom E. Holmlund, +47 91 668 668