JANUARY 1-JUNE 30, 2014 (compared with same period a year ago)
Net sales rose 8% (10% excluding exchange rate effects and divestments) to SEK 50,063m (46,451)
Organic sales growth, which excludes exchange rate effects, acquisitions and divestments, was 3% (4% including Vinda’s organic sales growth)
Operating profit excluding items affecting comparability rose 21% (21% excluding exchange rate effects and divestments) to SEK 5,564m (4,593)
The operating margin excluding items affecting comparability was 11.1% (9.9%)
Profit before tax, excluding items affecting comparability, rose 24% (24% excluding exchange rate effects and divestments) to SEK 5,081m (4,087)
Items affecting comparability totaled SEK -405m (-791)
Earnings per share were SEK 4.66 (3.22)
Cash flow from current operations was SEK 2,078m (2,113)
Recalculations have been made for previous periods on account of new and amended IFRSs and rules governing consolidated financial statements and joint arrangements (see note 6)
We have presented a report for the second quarter of 2014 with continued sales growth, higher earnings and a higher margin compared with the same period a year ago. During the quarter, several innovations and product launches were carried out under the Libero, Libresse, TENA and Tork brands. The efficiency programs in the hygiene and forest products operations continue to deliver cost savings according to plan. Our Tissue and Forest Products business areas showed significant earnings growth. Personal Care was negatively impacted by higher raw material costs and negative exchange rate effects in emerging markets.
Consolidated net sales for the second quarter of 2014 grew 12% compared with the same period a year ago. Organic sales growth was 3.3% and pertained to all business areas. Growth was mainly in emerging markets and in the Forest Products business area.
Operating profit for the second quarter of 2014, excluding items affecting comparability, rose 29% compared with the same period a year ago. The increase is mainly attributable to a better price/mix, higher volumes, cost savings, the acquisition of the majority shareholding in the Chinese company Vinda, and gains on forest swaps. The operating margin excluding items affecting comparability increased by 1.5 percentage points to 11.4%. Earnings per share grew by 56%. Operating cash flow increased by 28% to SEK 2,060m.
As part of our strategy to grow in emerging markets, SCA and Vinda have concluded an agreement under which Vinda will take over SCA’s hygiene operations in China, which will lead to mutual benefits in distribution, sales, innovation, and research and development. SCA’s joint venture in Australia, New Zealand and Fiji – Asaleo Care – has been floated on the Australian Securities Exchange (ASX). SCA’s holding in Asaleo Care after the IPO is approximately 32.5%.
SCA discloses the information provided herein pursuant to the Securities Markets Act. This report has been prepared in both Swedish and English versions. In case of variations in the content between the two versions, the Swedish version shall govern. Submitted for publication on July 18, 2014, at 12 noon CET.
The Board of Directors and President certify that the interim report gives a true and fair view of the Parent Company’s and Group’s operations, financial position and results of operations, and describes material risks and uncertainties facing the Parent Company and the companies included in the Group.