Altri posted a net result of 117.4 million euros in the first nine months of this year, an increase of 29.9% compared to 90.4 million recorded in the same period last year.
However, in the third quarter alone, earnings were €47.7 million, an increase of just 3.8%, which the company attributes to “a negative evolution of the USD currency hedges recorded in earnings and an increase in the effective tax rate quarterly.”
In a statement to CMVM, Altri adds that through Caima, Celbi and Biotek, it produced 852,100 tons of cellulose fiber in the first nine months of this year, down 1.6% from the same period last year, “taking into account planned closures. Biotek in May”, with foreign markets absorbing 86% of the total.
“The group’s financial performance was affected by production volumes, sales, and prices,” the paper pulp manufacturer says in a presentation.
Total revenue reached 805.9 million euros, up 37.7% compared to the first nine months of 2021. The pulp business alone generated €667.8 million in revenue, up 36.9% from the same period in 2021.
EBITDA for the year reached 223.4 million euros, up 25.4% year on year. In the third quarter alone, EBITDA was 92.6 million, Altri highlighted in a statement that “EBITDA per tonne of pulp reached 338 euros, a record high in the group’s history, demonstrating a focus on efficiency and profitability.”
EBITDA margin at the end of September was 27.7%, down 2.7 percentage points from the same period in 2021.
“Despite the favorable pulp price environment, the inflationary context of several variable costs limited the margin change,” Altri explains, noting that “there is still a corresponding increase in the prices of chemicals, natural gas and wood.”
Until September, the group’s investments had more than doubled to 34.8 million euros, compared to 16.8 million euros in the same period last year.
Despite this, net debt stood at around EUR 358.9 million at the end of September, only slightly higher than the EUR 356.9 million recorded at the end of June. The net debt/EBITDA ratio was 1.3x.
José Soares de Pina, CEO of Altri, highlights in the announcement that accompanies the disclosure of the results that the figures were achieved “in challenging conditions, especially with regard to inflation of various variable costs”, adding that “significant increases have been recorded in the price of natural gas, as well as chemicals. In addition, the average cost of timber “was higher, largely reflecting higher levels of imports,” he says.
“All of these factors are affecting the Altri Group, resulting in a corresponding increase in production costs per tonne. However, as a result of focusing on the efficiency of our operations, we achieve more than just offsetting these costs.” .
The low level of net debt, says José Soares de Pina, “allows us to maintain the financial capacity to consider the possibilities of the bioeconomy.”
Regarding the project for a new industrial plant for the production of sustainable textile fibers in Galicia, the CEO says he intends to announce the final investment decision in the first half of next year. Regarding the Gama project, Altri also notes that it continues to move forward in the main areas of decision-making, namely in the field of environmental impact study, engineering design, economic viability, funding structure and access to European Union funds.
In addition to the international context of increased demand for pulp, Altri notes that stock levels in European ports are still well below the averages of recent years, “having reached the lowest level in the last five years in July 2022”, which “has a positive impact on prices for wood fiber (BHKP), which remained at $1,380 per tonne in the third quarter.”
In terms of year-end outlook, the group notes that “decreasing inventory levels in European ports, combined with strong demand in key segments such as fabrics, are good indicators for the near future.”
On the supply side, he highlights that “global logistics is in the process of normalizing but still has some impact on many value chains.”
Altri points out that “general variable cost inflation was a major concern for the group in 2022”, confirming that “rising natural gas prices, chemical prices and timber costs, largely attributable to increased imports, were the main drivers of the corresponding increase in production cost per ton.
Regarding the decisions made to minimize this effect, the group says that it has recently begun “introducing some solutions, namely by reducing the consumption of natural gas by using alternative products.”