Sappi CEO Steve Binnie
Following pulp and paper manufacturer Sappi’s continued recovery over the past few quarters, the group has posted a doubling of profits for the first half of the current financial year.
The company’s profit increased 119% from $80-million in the six months to March 2015 to $175-million for the six months to March 31.
On a quarterly basis, Sappi posted a 79% increase in profit from $56-million in the second quarter of 2015 to $100-million in the three months to March 31.
Earnings a share for the interim period under review were 33c, just over double that of the 15c posted in the prior corresponding period the year before.
“Our strategy to reposition Sappi as a profitable and cash-generative diversified woodfibre group remains well on track,” Sappi CEO Steve Binnie said on Monday.
Earnings before interest, taxes, depreciation and amortisation increased to $370-million in the first half of the year, from the $315-million achieved in the first half last year.
“The strong operating performance in the quarter occurred despite the $10-million adverse impact of planned maintenance shuts across the group when compared to the equivalent quarter last year,” he pointed out, attributing the performance to higher dissolving wood pulp sales volumes and prices, savings from cost containment initiatives and lower finance charges during the period under review.
Sales reduced to $2.58-billion in the first half of the year from $2.71-billion in the prior corresponding period the year before.
Sappi's share price on the JSE rose by as much as 17% on Monday.