Ilkka Hämälä CEO, Metsä Fibre - Metsä Board and other IR... · Metsä Fibre–...
Transcript of Ilkka Hämälä CEO, Metsä Fibre - Metsä Board and other IR... · Metsä Fibre–...
Metsä Fibre –Strong fibre expertise
Ilkka HämäläCEO, Metsä Fibre
Metsä BoardCapital Markets Day 2017
• Metsä Fibre in brief and market
position
• Market pulp update
• Äänekoski Bioproduct mill
• Summary
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Contents
• Producing high-quality northern bleached softwood and
birch pulp
• 4 pulp mills in Finland and 7 sawmills in Finland and
Russia
• New bioproduct mill will rise the total pulp capacity from
2.5 Mt/a (in 2017) to 3.3 Mt/a (in 2018)
• Sales in 2016*) were EUR 1.6 billion and comparable
operating result EUR 215 million
• Owners: Metsäliitto Cooperative 50.2%, Metsä Board
24.9%, Itochu Corporation 24.9%
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Metsä Fibre – a leading producer of
bioproducts and bioenergy
*) Include the full year figures from Finnish sawmills
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Excluding fluff and dissolving pulp
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0 500 1000 1500 2000 2500 3000
Resolute Forest Products
Domtar
Södra
Paper Excellence Group
Mercer International
Arauco
Georgia-Pacific
Stora Enso
International Paper
Metsä Group
Metsä Group is the leading producer in
chemical softwood pulp globally
Annual capacities, 1,000 tonnes Increase from new Äänekoski Bioproduct Mill
Source: Pöyry Management Consulting
Excluding fluff and dissolving pulp
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0 500 1000 1500 2000 2500
Resolute Forest Products
Canfor
Domtar
Stora Enso
International Paper
Södra
Paper Excellence Group
Mercer International
Arauco
Metsä Group
Metsä Group is the leading producer in
chemical softwood market pulp globally
Annual capacities, 1,000 tonnes Increase from new Äänekoski Bioproduct Mill
Source: Pöyry Management Consulting
Market BSKP (Bleached softwood kraft pulp)
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Industry structure with new
Äänekoski Bioproduct Mill
Source: Pöyry Management Consulting Oy Technical age, years
Weighted average bleached kraft pulp capacity**, 1 000 t/a
STRONG
Weighted average technical
age 21,5 yearsWEAK
Bubble size reflects the
allocated grade capacity
** = based on the grade allocation
in Pöyry’s Smart
Metsä
Fibre
Weighted average
capacity 546 000 t/a
1000
800
600
400
200
030 25 20 15 10 5 0
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The most cost competitive and efficient player in the industry
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4
4
4
1
1
1
3
3 3
2
2
2
0
200
400
600
800
1,000
0 5,000 10,000 15,000 20,000 25,000
Cost Competitiveness* in RotterdamMarket BSKP – Selected ProducersUSD/t
**)Capital charges include straight-line depreciation and ROCE 10,0%
Operating rate 100%
1 Metsä Fibre, Joutseno
2 Metsä Fibre, Kemi
3 Metsä Fibre, Rauma
4 Metsä Fibre, Äänekoski (new BPM)
Full Costs **)
Delivered Costs
to Rotterdam
Manufacturing
Costs
2016/IV
Cumulative capacity, 1000 t/a
1 USD=0.95 EUR
1 EUR=1.05 USD
1 USD=1.33 CAD
Source: Pöyry Management Consulting
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*)Based on modelled costs
Market pulp update
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World market pulp shipments
by market area and forecast
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Source: Hawkings Wright, Brian McClay & PPPC
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October 2016 – March 2017
growth +1.6Mt, of which 1.1 Mt
BHKP and 0.5Mt BSKP
Source: Hawkings Wright & PPPC World-20
1,0
00 t
onnes
Bleached chemical market pulp shipments to China
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Year-on-year growth
Chinese tissue and graphic paper demand Consumes 80% of all market pulp deliveries
Source: Hawkins Wright
Graphic papers:
average annual
demand growth of
1% through 2021
Tissue to remain
the dominant
driver: average
annual demand
growth of 7.5%
through 2021
-
5.0
10.0
15.0
20.0
25.0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Mill
ion
to
nn
es
Tissue and specialty
Graphic
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Capacity additions in softwood and hardwood
market pulp and European benchmark price
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
0
200
400
600
800
1,000
1,200
Gre
en
field
cap
acity
(millio
n tp
a)
Pu
lp p
ric
es
US
$/t
(c
if E
uro
pe
)
NBSK cif Europe
BEKP cif Europe
Valdivia
APP Guangxi
Rizhao
Tres Lagoas
Fray Bentos
Mucuri
Nueva Aldea
Santa Fe
Veracel
APP Hainan
Chenming ZhanjiangKerinci
PL3
MaranhaoMontes
del Plata
Eldorado
OJIIlim
Guaiba
Klabin
OKILine 1
Mercer Stendal
Source: Hawkins Wright
Äänekoski Bioproduct Mill
INVESTMENT, EUR
1.2 billion
ELECTRICITY, Wh/a
1.8 tera
WOOD USAGE, m3/a
6.5 million
ELECTRICITY SELF
SUFFICIENCY
240 percent
CERTIFIED WOOD
90 percent
START UP
Q3/2017
“UNIQUE BIO ECOSYSTEM
UTILIZING PRODUCTS FROM
ALL PRODUCTION STREAMS”
CAPACITY, tonnes/a
1.3 million
Äänekoski Bioproduct Mill in a Nutshell
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Bioproduct Mill
Concept
Botnia Nordic Pulp
Bioenergy
Biochemicals
Future
Biomaterials
Ecosystem
20%other bioproducts
1.300.000tonnes of pulp
10%other
bioproducts
530.000tonnes of pulp
Existing pulp mill
New bioproduct mill (2017)
Revenue from
other bioproducts
will increase
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Bioproducts beyond pulp
– Utilizing all side streams
PULPWOOD
PULP
BARK*
TURPENTINE* AND
CRUDE TALL OIL*
ODOROUS
GASES
LIGNIN
SLUDGE
CLEAN WATER
DREGS AND ASHES
BIOENERGY*:
POWER, STEAM,
DISTRICT HEATGLAUBER
SALT
PULP
GRADING
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250
100
150
750
Metsä FibreShareholder capitalShareholder loanDebt
• 40% equity
• Metsä Fibre
• Increase of shareholder
capital
• Shareholder loan by Itochu
Corporation
• 60% debt financing
• Export credit guarantees by
Finnvera and EKN
• Loans by EIB and
Commercial banks: Nordea,
Pohjola Bank, Danske Bank,
DNB Bank, SEB and
Swedbank
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Bioproduct mill financing
Financing, Meur
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Construction schedule
month
2015 2016 2017 2018
2-3 6 9 5 Q3 mid
year
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• Estimated annual income effect on the Finnish economy
approx. EUR 0.5 billion
• Increases the value of Finnish exports by EUR 0.5 billion
annually
• The mill will diversify the Finnish forestry sector and bio-
economy structures and broaden the current product portfolio
• Supports Finland in reaching its goal for renewable energy
– The bio-product mill will increase the share of renewable
energy in Finland by approx. 2 percentage points
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Significant contribution
for the Finnish economy
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• Metsä Group is the leading producer in chemical softwood
market pulp globally with excellent cost competitiveness
• Demand in softwood pulp is continuing – Biggest growth driver
is Chinese domestic consumption
• The new bioproduct mill is the biggest bioeconomy investment
in Europe
• The bioproduct mill creates sustainable growth
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Summary
2017 CMD Hämälä