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Ahlstrom-Munksjö interim Report January-September 2020: SOLID RESULT AND CASH FLOW


This release is a summary of Ahlstrom-Munksjö's interim report January-September 2020. The complete report is attached to this release as a pdf-file. It is also available at


  • Solid comparable EBITDA and increased margin, sales volumes recovered from a low level in the previous quarter
  • Comparable EBITDA and sales volumes remained below last year's level
  • Strong recovery in demand for transportation and furniture related products, while demand remained weak for industrial products 
  • Solid cash flow and financial position further strengthened 
  • Launch of lead acid battery product portfolio under the Ahlstrom-Munksjö FortiCell range of fiber-based solutions for energy storage applications
  • World-class Net Promoter Score achieved in an external customer survey
  • Recommended public tender offer for all Ahlstrom-Munksjö shares
  • Comparable EBITDA in 2020 is expected to be in the range of EUR 315-335 million (EUR 313 million in 2019)

Q3/2020 compared with Q3/2019

  • Net sales decreased by 8.0% to EUR 654.5 million (711.3), mainly due an adverse currency effect and lower average selling prices
  • Comparable EBITDA decreased to EUR 78.9 million (83.6), representing 12.1% (11.7) of net sales, impacted by scheduled maintenance shutdowns
  • Operating result of EUR 32.9 million (34.3)
  • Net result EUR 15.5 million (12.0)
  • Earnings per share (basic) EUR 0.13 (0.10)
  • Comparable EPS excluding depreciation and amortization arising from PPA EUR 0.24 (EUR 0.22)

Q1-Q3/2020 compared with Q1-Q3/2019

  • Net sales decreased by 9.9% to EUR 1,994.1 million (2,214.1), mainly due to lower average selling prices and volumes as well as an adverse currency effect   
  • Comparable EBITDA increased to EUR 244.7 million (242.4), representing 12.3% (10.9) of net sales, driven by lower variable costs, which more than offset lower selling prices and sales volumes
  • Operating result of EUR 132.5 million (87.2), including a capital gain of EUR 32.0 million from the sale of the fine art paper business
  • Net result EUR 71.2 million (30.9)
  • Earnings per share (basic) EUR 0.59 (0.26)
  • Comparable EPS excluding depreciation and amortization arising from PPA EUR 0.72 (0.68)
  • Net debt decreased to EUR 804.2 million (885.0 in Q4/2019), supported by the sale of the fine art paper business

PPA = purchase price allocation


Key figures Q3 Q3 Q2 Q1-Q3 Q1-Q3 Q1-Q4
EUR million, 2020 2019 2020 2020 2019 2019
or as
Net sales 654.5  711.3  621.5  1,994.1  2,214.1  2,915.3 
Comparable 78.9  83.6  74.0  244.7  242.4  312.9 
Comparable 12.1  11.7  11.9  12.3  10.9  10.7 
margin, %
EBITDA 74.4  77.8  69.1  264.0  216.1  279.4 
Comparable 37.5  40.1  31.8  118.4  113.5  139.0 
Operating 32.9  34.3  25.8  132.5  87.2  103.2 
Net result 15.5  12.0  9.0  71.2  30.9  32.8 

Earnings per 0.13  0.10  0.07  0.59  0.26  0.27 
(basic), EUR
Comparable 0.16  0.14  0.10  0.47  0.43  0.50 
per share
Comparable 0.24  0.22  0.18  0.72  0.68  0.84 
arising from
EUR [*]

Return on 6.2  1.0  5.9  6.2  1.0  2.9 
rolling 12
months, %
Comparable 5.6  5.4  5.4  5.6  5.4  5.2 
rolling 12

Return on 6.4  3.4  6.4  6.4  3.4  4.4 
rolling 12
Comparable 6.2  6.2  6.3  6.2  6.2  5.9 
rolling 12

Net cash 104.3  125.4  8.5  124.6  218.4  286.7 

Capital 25.5  50.6  24.4  76.2  124.8  161.1 
Net debt 804.2  981.7  878.7  804.2  981.7  885.0 
Gearing 68.9  85.4  74.3  68.9  85.4  71.8 
ratio, %

m PPA (purchase price allocation) comprise depreciation and amortization charges from fair value adjustments relating to the business combinations

*Depreciation and amortization arising from PPA (purchase price allocation) comprise depreciation and amortization charges from fair value adjustments relating to the business combinations starting from 2013.


I'm pleased with our financial performance in the third quarter, and in particular, with our agile way of responding to the recovery in customer activity. Our comparable EBITDA increased to EUR 79 million and the margin to 12.1% from the previous quarter on the back of higher customer deliveries. This was a good achievement considering the scheduled maintenance activity, and if this timing impact is excluded, our result would have been at last year's level. Our profitability continued to benefit from lower variable costs due both to lower raw material prices and our cost-saving measures. Cash flow was strong, thanks to the seasonal reduction in net working capital, and this helped to strengthen our financial position.

Customer activity recovered during the third quarter as countries and markets reopened after lockdowns. This was particularly visible for transportation, as well as home building- and furniture-related applications, which are important end-use segments for us. Demand continued on a good level in health care and life science end uses, and remained stable in the consumer goods-related end uses. Towards the end of the quarter, there were also signs of increasing demand for industrial-related products. Overall, our sales volumes increased notably from the second quarter and were close to the previous year's level.

A consortium of investors has announced a public tender offer to the shareholders of Ahlstrom-Munksjö. I consider this evidence of the good work we have done in recent years and how we have succeeded in creating an attractive business in a world of increasing stakeholder expectations. I am also confident that the planned ownership change would ensure that we can develop our company to its fullest future potential.


I'm particularly pleased with the positive results of our comprehensive customer survey conducted by Opticom International Research, which is a proof point that we have further reinforced our position as a global leader in fiber-based solutions. We scored particularly well in categories such as personal contact and technical service, as well as in innovation and sustainability. These are essential in strengthening our partnership with our customers, and are also important in solving the challenges of today's society. We also achieved a world-class rating for a manufacturer in business-to-business Net Promoter Score.


The recovery in our main markets seems to be continuing. However, there is some uncertainty provided that the recent increase in coronavirus cases could force governments around the world to reimpose regional or national restrictions. Overall, I'm very proud of how well our organization has performed in these very exceptional circumstances and responded to quickly changing market conditions. This really highlights the strengths of our company.


The gradual increase in customer activity translated into a broad-based recovery across the company's businesses during the third quarter of 2020. The overall demand for Ahlstrom-Munksjö's products is expected to remain at a rather good level in the fourth quarter of 2020, albeit with some variation depending on the end use of the products.

Ahlstrom-Munksjö's comparable EBITDA in 2020 is expected to be in the range of EUR 315-335 million (EUR 313 million in 2019). The latest development in the pandemic has further increased uncertainty. 


As Ahlstrom-Munksjö manages a broad portfolio of businesses and serves a wide range of end uses globally, it is unlikely to be significantly affected at a group level by individual business related factors. However, slowing global economic growth and uncertain financial market conditions could have a materially adverse effect on the Group's financial results, operations and financial position. 

Recently, the key driver for increased uncertainty globally from an economic and social perspective has been the coronavirus pandemic. The risk of a broader economic downturn is tangible, and if it materializes, it may weaken demand for a wide range of Ahlstrom-Munksjö products for a longer period. According to the IMF, global growth is estimated at - 4.4% in 2020, a less severe contraction than previously forecast. The full impact of the pandemic cannot be foreseen at this stage. It will depend on both the duration and severity of the pandemic, and related measures taken to contain Confirmed coronavirus cases are increasing around the world and in several countries a second wave is looming, which may lead to resumed regional or national restrictions. The pandemic situation has become the new normal with its uncertainties and adapting mitigation activities to manage the situation.

Ahlstrom-Munksjö has assessed carrying amounts of assets and liabilities, such as goodwill and other intangible, tangible assets, inventories, deferred taxes, trade receivables and pension plans and re-assessed the need of impairment. Based on the assessments, the consequences of the pandemic has currently no impact on asset valuations.

The company's significant risks and uncertainty factors mainly consist of developments in demand for and prices of sold products, the cost and availability of significant raw materials and energy, financial risks, as well as other business factors including developments in global politics, regulations and the financial markets. The company's financial performance may be impacted by the timing of possible raw material price increases and its ability to raise selling prices. On-going trade disputes pose a threat to the global economy, which may have an effect on Ahlstrom-Munksjö's markets. 

Operational risks such as personnel absences, supply of key raw materials and deliveries to customers have also increased due to the pandemic. These risks have been mitigated by a rapid and coordinated response, and the implementation of the Ahlstrom-Munksjö COVID-19 Safety Protocol. However, if the pandemic continues for a longer period, the exposure to the operational  risks may increase. 

The company's key financial risks include interest rate and currency, liquidity and credit risks. To mitigate short-term risks, methods such as hedging and credit insurance are used. Additional credit risk assessment has been implemented for customer receivables  to evaluate the potential implications of the coronavirus pandemic. Based on the assessment, the company has not identified any significant increase in the amount of bad debt, and there has currently not been any signif...

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