Swedish forest products manufacturer Holmen AB has reported an increase in profits for the first half of 2011 but its timber division is continuing to struggle.
The company recorded SKr672m profit after tax compared to SKr312m a year ago, while turnover was SKr9.5bn (2010: SKr8.6bn)
Second quarter earnings more than doubled from a year ago to SKr302m.
Holmen’s paper and paperboard operations were mainly responsible for the positive result.
The timber division saw first half operating profits plunge to a SKr65m loss, compared to a profit of SKr18m a year ago.
Losses deepened in the second quarter (-SKr38m), compared to a profit of SKr11m a year ago.
“The weak result was due to depreciation and start-up costs for the new sawmill in Braviken, high raw material prices and a weak market with price pressure,” said Holmen.
Deliveries amounted to 201,000m³ during the first six months, of which 62,000m³ was spruce from the new Braviken sawmill. Total production at Braviken reached 108,000m³.
