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Q4 operating profit zooms 49% at nonwovens maker Suominen

06 Feb '15

2 min read

Operating profit excluding non-recurring items zoomed 49.3 per cent to €6.2 million in the fourth quarter ended December 31, 2014 as against €4.2 million in same quarter of 2013 at nonwovens producer Suominen.

“Share of products with higher added value in Suominen’s portfolio grew, which was reflected in the gross profit as well as in operating profit,” Suominen said.

For the fourth quarter, net sales too surged 16.6 per cent and amounted to €104.8 million compared to € 89.8 million in the corresponding quarter of 2013.

According to CEO Nina Kopola, the positive development in sales was influenced by the strengthening of US dollar, acquisition of the Paulínia plant and improved demand in European markets.

Suominen’s substantially lower gearing ratio is further proof of the favourable development in the company’s balance sheet in 2014.

The company’s debt repayment capacity and its healthy financial position, both thanks to the good operative cash flow, facilitated the refinancing.

“In 2014, we achieved the targeted level for all of the financial targets set by the company’s board of directors in 2012,” Kopola informed.

The return on investments from continuing operations increased to 15.7 per cent against a targeted plus 10 per cent, while gearing ratio fell to 34.7 per cent versus target level of 40–80 per cent.

Suominen also achieved the third target of organic net sales growth at a rate faster than the industry average of 3 per cent by organically growing at 3.5 per cent.

Suominen announced its revised strategy for 2015–2017 in October. In the strategy period, it said it will target a higher return on investments at 12 per cent.

It will try to achieve a gearing ratio principally between 40–80 per cent and organic growth that exceeds the industry average, which is estimated to be roughly 3 per cent in Suominen’s market areas.

After the end of the review period, Suominen announced it has started to plan the largest single project of its growth investment program, building of a new manufacturing line in North America.

Suominen expects that for the full year 2015, its net sales and operating profit excluding non-recurring items will improve from year 2014.

Its board of directors has proposed annual dividend at €0.01 per share fund for 2014, which will total approximately to €2.5 million. (AR)

Fibre2fashion News Desk - India