Swedish forest products company Holmen is the latest name to record poor third- quarter results as a consequence of the weak market for sawn timber.
Overall, the group’s net turnover fell from SKr4.64bn to SKr4.59bn year-on-year, and profits after tax declined from SKr438m to a loss of SKr24m. Operating profits were down SKr578m from 2007 to SKr64m.
Holmen Timber contributed SKr116m to the net turnover, down from SKr124m in the third quarter of 2007. Operating costs increased from a loss of SKr84m to a loss of SKr109m, leading operating profit to fall from SKr35m to a loss of SKr1m.
Lower prices for sawn timber were the main reason for the negative performance, Holmen said.
Holmen Skog, the company’s forest management and wood procurement division, saw an increase in its results for the third quarter, with net turnover up from SKr1.1bn to SKr1.2bn and operating profit up from SKr145m to SKr150m. This, it said, was due to a change in the value of the company’s forests, which grew by SKr23m during the third quarter. However, earnings from operations declined by SKr8m to SKr127m, primarily due to a reduction in harvest volumes.
Holmen added plans are continuing for a new sawmill at its Braviken Paper Mill, with the facility due to start production in the second half of 2010.
