UPM Annual Report 2018

UPM AT A GLANCE

STRATEGY

BUSINESSES

SOCIETY AND ENVIRONMENT

GOVERNANCE AND COMPLIANCE

REPORT OF THE BOARD OF DIRECTORS

FINANCIAL STATEMENTS

AUDITOR’S REPORT

OTHER FINANCIAL INFORMATION

Reconciliation of key figures to IFRS

Financial information 2009–2018

EURm, OR AS INDICATED Income statement Sales Comparable EBITDA 1)

2018 2017 2016 2015 2014 2013 2012 2011 2010 2009

EURm, OR AS INDICATED

Q4/18 Q3/18 Q2/18 Q1/18 Q4/17 Q3/17 Q2/17 Q1/17 Q1-Q4/18 Q1-Q4/17

Items affecting comparability Impairment charges

–

–

–

– –4 – –61

–

–

1

– 9

–3

10,483 10,010 9,812 10,138 9,868 10,054 10,492 10,068 8,924 7,719 1,823 1,631 1,560 1,350 1,306 1,161 1,325 1,383 1,343 1,062 17.4 16.3 15.9 13.3 13.2 11.5 12.6 13.7 15.0 13.8 1,895 1,259 1,135 1,142 674 548 –1,318 459 755 135

Restructuring charges

–10

– 18

–2

–2

–3

–67

Change in fair value of unrealised cash flow and commodity hedges Capital gains and losses on sale of non-current assets Fair value changes of forest assets resulting from changes in estimates

% of sales

6

–3

–2

– –2

–6

1

9

–

2

Operating profit

% of sales

18.1 12.6 11.6 11.3

6.8

5.5 –12.6

4.6

8.5

1.7

–

– –2

30

1

35

–

–

29

35

Comparable EBIT

1,513 1,292 1,143 916 866 683 556 682 731 270

% of sales

14.4 12.9 11.6

9.0

8.8

6.8

5.3

6.8

8.2

3.5

345

–

–

–

–

–

–

–

345

–

Profit before tax

1,839 1,186 1,080 1,075 667 475 –1,271 417 635 187

Total items affecting comparability in operating profit

% of sales

17.5 11.9 11.0 10.6

6.8

4.7 –12.1

4.1

7.1

2.4

340

–3

15

30 –67

28

–1

7

382

–33

Comparable profit before tax

1,457 1,218 1,089 849 793 610 471 573 611 107

Total items affecting comparability in financial items

% of sales

13.9 12.2 11.1

8.4

8.0

6.1

4.5

5.7

6.8

1.4

– –

– – 1 1

– –

–

–

1 –

– –

– –

– –

1

Profit for the period

1,496 974 880 916 512 335 –1,122 457 561 169

Changes in tax rates

– –5

–5

% of sales

14.3

9.7

9.0

9.0

5.2

3.3 –10.7

4.5

6.3

2.2

Taxes relating to items affecting comparability Items affecting comparability in taxes Items affecting comparability, total

–68 –68 272

–3 –3 11

–9 –9

19 –10 14 –10

– –2 – –2

–80 –80 302

7 2

Comparable profit for the period

1,194 1,004 879 734 638 479 390 487 516

58

% of sales

11.4 10.0

9.0

7.2

6.5

4.8

3.7

4.8

5.8

0.8

–2

21 –53

19

–1

6

–30

Balance sheet Non-current assets

Comparable EBITDA Operating profit

9,501 9,144 9,715 10,259 10,269 10,487 11,066 11,412 10,557 10,581 1,642 1,311 1,346 1,376 1,356 1,327 1,388 1,429 1,299 1,112 2,853 2,612 2,850 2,558 2,570 2,785 2,489 2,548 1,956 1,912 13,996 13,067 13,911 14,193 14,195 14,599 14,943 15,389 13,812 13,605 9.797 8,663 8,237 7,944 7,480 7,455 7,461 7,477 7,109 6,602 2,194 2,254 3,364 4,328 4,717 5,019 5,430 5,320 4,922 5,432 2,005 2,150 2,309 1,921 1,998 2,125 2,052 2,588 1,781 1,571 13,996 13,067 13,911 14,193 14,195 14,599 14,943 15,389 13,812 13,605 10,575 9,777 10,657 11,010 10,944 11,583 11,603 12,110 11,087 11,066 303 329 325 520 411 362 357 1,179 257 913

744 417 349 385 299 379 269 312 1,895 1,259

Inventories

Depreciation, amortisation and impairment charges excluding items affecting comparability Change in fair value of forest assets and wood harvested excluding items affecting comparability Share of results of associates and joint ventures Items affecting comparability in operating profit

Other current assets

105 105 106 106 112 104 112 119

422

447

Total assets Total equity

Non-current liabilities

–47 –37 –14 –10 –26 –29 –32 –16 –107 –103

Current liabilities

–1

–2

–1

–2

–1

–1

–1

–2

–6

–5 33

Total equity and liabilities Capital employed at year end

–340

3 –15 –30

67 –28

1

–7 –382

Comparable EBITDA

461 487 425 449 451 425 349 405 1,823 1,631

Capital expenditure

% of sales

16.9 18.4 16.4 17.9 17.5 17.1 14.2 16.3

17.4

16.3

% of sales

2.9

3.3

3.3

5.1

4.2

3.6

3.4 11.7

2.9 11.8

Capital expenditure excluding acquisitions and shares

Comparable EBIT Operating profit

303 303 325 486 375 329 347 340 252 229

744 417 349 385 299 379 269 312 1,895 1,259

% of sales

2.9

3.0

3.3

4.8

3.8

3.3

3.3

3.4

2.8

3.0

Items affecting comparability in operating profit

–340

3 –15 –30

67 –28

1

–7 –382

33

Cash flow and net debt Operating cash flow

Comparable EBIT

404 420 334 355 366 351 270 305 1,513 1,292

1,391 1,558 1,686 1,185 1,241 735 1,040 1,041 982 1,259 1,131 1,336 1,424 750 994 438 968 910 787 1,045 –311 174 1,131 2,100 2,401 3,040 3,210 3,592 3,286 3,730

% of sales

14.8 15.9 12.9 14.1 14.2 14.1 11.0 12.3

14.4

12.9

Free cash flow

Comparable profit before tax Profit before tax

Net debt

731 401 337 371 273 357 258 299 1,839 1,186

Key figures Return on capital employed (ROCE), %

Items affecting comparability in operating profit Items affecting comparability in financial items

–340

3 –15 –30

67 –28 – –1

1 –

–7 –382

33 –1

18.4 12.5 10.5 10.3

6.5 7.6 6.9 8.5

4.8 neg.

4.4 5.2 6.3 6.7

6.6 6.4 8.2 7.5

3.2 2.5 2.8 1.0

–

–

–

–

–

–

Comparable ROCE, % Return on equity (ROE), % Comparable ROE, % Gearing ratio, % Net debt to EBITDA Equity to assets ratio, % Personnel Personnel at year end

14.6 12.8 10.6

8.3

6.0

4.2

Comparable profit before tax

390 404 322 341 340 328 258 291 1,457 1,218

16.2 11.5 10.9 11.9

4.5 neg.

12.9 11.9 10.9

9.5

6.4

4.2

Comparable ROCE, % Comparable profit before tax

–3

2

14

26

32

41

43

48

46

56

390 404 322 341 340 328 258 291 1,457 1,218 89 397 413 330 350 395 341 268 302 1,490 1,307 10,259 9,817 9,712 9,755 9,938 10,032 9,942 10,288 10,176 10,217 7 9 8 9 55 13 10 10 33

–0.17 0.11 0.73 1.56 1.84 2.62 2.42 2.60 2.45 3.51 70.1 66.6 59.4 56.1 52.7 51.1 50.0 48.6 51.5 48.6

Interest expenses and other financial expenses

Capital employed, average Comparable ROCE, %

18,978 19,111 19,310 19,578 20,414 20,950 22,180 23,909 21,869 23,213

15.5 16.8 13.6 14.3 15.9 13.6 10.8 11.7

14.6

12.8

Deliveries Pulp (1,000 t)

Comparable profit for the period Profit for the period Items affecting comparability, total Comparable profit for the period Comparable EPS, EUR Comparable profit for the period Profit attributable to non-controlling interest

3,468 3,595 3,419 3,224 3,287 3,163 3,128 2,992 2,919 1,759 8,608 8,127 8,782 8,966 8,721 8,925 9,486 8,911 9,426 8,865 8,996 9,430 9,613 9,771 10,028 10,288 10,871 10,615 9,914 9,021 791 811 764 740 731 737 679 656 638 567 1,719 1,728 1,751 1,731 1,609 1,661 1,696 1,683 1,729 1,497

591 328 269 309 244 286 205 240 1,496

974

Electricity (GWh)

–272

2 –11 –21

53 –19

1

–6 –302

30

Papers, total (1,000 t) Plywood (1,000 m 3 ) Sawn timber (1,000 m 3 )

319 330 258 288 297 267 205 234 1,194 1,004

319 330 258 288 297 267 205 234 1,194 1,004 –1 321 328 258 287 296 267 205 234 1,193 1,003 2 –2 – –1 –1 – – – –1

1) EBITDA 2009–2011 includes change in fair value of unrealised cash flow and commodity hedges.

Average number of shares basic (1,000)

533,324

533,324 533,324 533,324 533,324 533,323 533,328 533,505 533,505 0.60 0.61 0.48 0.54 0.56 0.50 0.39 0.44

533,415

Comparable EPS, EUR

2.24

1.88

Comparable ROE, % Comparable profit for the period

319 330 258 288 297 267 205 234 1,194 1,004 9,491 8,959 8,856 8,821 8,497 8,204 8,020 8,100 9,230 8,450

Total equity, average Comparable ROE, %

13.4 14.6 11.6 13.0 14.0 13.0 10.2 11.6

12.9

11.9

Quarterly key figures are unaudited.

188

189

CONTENTS

ACCOUNTS

UPM ANNUAL REPORT 2018

UPM ANNUAL REPORT 2018