Strong growth continues for Metsä Tissue's brands

Metsä Tissue, a leading producer of tissue and cooking papers, reported sales totalling 725 million euros (692) for the year to date September. Operating profit excluding non-recurring items came to only 17 million euros (45). Net sales showed a year-on-year increase of roughly 5 per cent, the increase being mainly attributable to a favourable sales mix and currency fluctuations. Sales of Metsä Tissue’s own brands showed a year-on-year increase of 8 per cent, with Lambi, Katrin and Serla showing particularly healthy growth.

Tissue production capacity has grown rapidly over the past year in certain markets. Profit margins have been eroded particularly in the Central European retail business. Pulp and recovered paper prices stabilised last summer after two years of rapid inflation. Metsä Tissue’s euro-based pulp costs nevertheless remained high due to the strong US dollar. The cost of packaging and chemicals continued to climb steeply in the third quarter. Soaring oil prices and the strong US dollar have had a tangible adverse impact on material, energy and transportation costs. The start-up of production at the new Düren mill in Germany represented a significant additional expense for the company.

The third quarter marked the successful completion of the company’s major investment programme in its Baking & Cooking business in Düren, Germany. The September inauguration of the renewed mill coincided with the launch of a wholly new product concept targeted both at cooking professionals and consumers: SAGA One-Up, which brings the convenience of pop-up tissue packaging to kitchen papers. SAGA products received a special distinction in the coveted German KÜCHE AWARDS.

Following a licensing deal with Georgia-Pacific announced last June and finalised in September, Metsä Tissue launched the production, marketing and sale of Lotus-brand consumer tissue products in Russia, adding sixteen new sales and marketing experts to the Metsä Tissue team. The company’s strategic goal is to expand its foothold in Russia.

Metsä Tissue’s three-year investment programme proceeded on schedule at the Krapkowice mill in Poland. The investment will further strengthen the company’s presence in Central Europe.

Finland and Scandinavia are preparing for the New Year go-live of the company’s unified processes and common ERP system. All German units adopted the new system and processes in the first quarter of 2011.

Metsä Tissue continued its collaboration with WWF Finland in the form of a sustainability training initiative launched last June. Metsä Tissue will organize workshops for its personnel in all four of its geographical regions under a partnership agreement signed between Metsäliitto Group and WWF Finland. This sustainability-oriented staff training initiative is part of the company’s continuous improvement policy.

Katrin launched a new Europe-wide campaign promoting better hygiene at workplaces and in washrooms. The campaign is supported by the Katrin Ease touch-free dispenser range, which improves hygiene and offers enhanced efficiency and convenience in washrooms.

The Serla brand continued celebrating its 50^th jubilee with a varied programme of events targeted at personnel, customers and consumers. At the end of summer Serla launched its new economy-sized toilet and household paper packages, which contain 35-50 per cent more paper than standard-sized packages.

Metsä Tissue will continue committing resources towards the successful completion of its strategic development projects. Other key end-year goals are higher operating profit and increased brand growth.