Growth Engine Mats Nordlander, EVP, Renewable Packaging
Mats Nordlander   22 March 2012   2
World needs a new approach to materials                           Renewable packaging    Recyclable packaging             ...
How we will win!                       Customer                      experience                   Customers               ...
”How likely would you recommend   Stora Enso as a supplier?”                                                              ...
Renewable Packaging                      Sales, Operational EBIT, ROOC        EUR million                                 ...
Consumer Board performance            against selected peersROCE %                                               EBIT 2011...
Key challenges                                             Our response                                                   ...
Our strategic growth areas Virgin-fibre           • Global #1    based               • Premium consumer                 pr...
Significant growth expected for corrugated packaging  in Eastern Europe, Asia and Middle East & Africa                    ...
• EUR 137 million in a new power plant to secure efficient                            energy supply completed  Ostroleka  ...
Strongest growth in demand of virgin fibre-          based consumer board will be in Asia                                 ...
Consumers start to buy packaged food once annual family income reaches USD 5 000 Population in households with annual     ...
India, China and Pakistan estimated to drive       growth in terms of milk volumesConsumption estimate for Liquid Dairy Pr...
Accelerate what worksEvery third beverage carton in the world  is produced fromStora Enso materials!                   Mat...
Stora Enso to build world-class pulp andconsumer board mill in Southern China   Integrate including:   •Paperboard mill of...
Focusing on high quality segments in China            Unique                                   Chinese platform           ...
Total investment approximately EUR 1.6 billion                  Mats Nordlander   22 March 2012   18
Mats Nordlander   22 March 2012   19
Independent sustainability impact studies give        solid platform for the project • UNDP’s Environmental and           ...
Key takeawaysRenewable packaging - Solution for the future!                                       Focus on profitable grow...
Growth Engine     Mats Nordlander   22 March 2012   22
Mats Nordlander   22 March 2012   23
Stora Enso’s Operations in China       Personnel currently about 4 500 in China                                           ...
It should be noted that certain statements herein which are not historical facts. including. without limitationthose regar...
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Stora Enso CMD - Presentation by Mats Nordlander, EVP, Renewable Packaging

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Stora Enso's Capital Markets Day on 22 March 2012

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Stora Enso CMD - Presentation by Mats Nordlander, EVP, Renewable Packaging

  1. 1. Growth Engine Mats Nordlander, EVP, Renewable Packaging
  2. 2. Mats Nordlander 22 March 2012 2
  3. 3. World needs a new approach to materials Renewable packaging Recyclable packaging • Responsible and resource Packaging efficient choice for packaging material! • More from less • End of waste • Protects goods • Consumer communication • Efficient supply chains Mats Nordlander 22 March 2012 3
  4. 4. How we will win! Customer experience Customers and Consumers Products for Efficient demandingsupply chain customers Mats Nordlander 22 March 2012 4
  5. 5. ”How likely would you recommend Stora Enso as a supplier?” Net Promoter Score Source: Stora Enso Customer Experience Management System VOICE Mats Nordlander 22 March 2012 5
  6. 6. Renewable Packaging Sales, Operational EBIT, ROOC EUR million EUR million EBITSales 2010 14.9% ROOC 2011 14.2% Mats Nordlander 22 March 2012 6
  7. 7. Consumer Board performance against selected peersROCE % EBIT 2011 EUR million 272 137 96 309 96 Mats Nordlander 22 March, 2012 7
  8. 8. Key challenges Our response •M&A and greenfield initiatives• Too small market share in started to accelerate growth in growth markets growth markets• Competing materials •Investing in R&D - MFC •Investing in cost competitive RCP• Non-competitive containerboard containerboard machine with capacity modern lightweight product• High cost Russian wood in •Reducing costs of Russian wood Imatra supply •Debottlenecking, streamlining• Cost competitiveness and cost control • Skoghall Mill wood yard • Imatra Mills’ pulp drying • Restructuring in converting Restructuring and growth in balance Mats Nordlander 22 March 2012 8
  9. 9. Our strategic growth areas Virgin-fibre • Global #1 based • Premium consumer products board • Growth markets Corrugated • Global partner packaging customers Mats Nordlander 22 March 2012 9
  10. 10. Significant growth expected for corrugated packaging in Eastern Europe, Asia and Middle East & Africa CAGR 4.4% CAGR CAGR CAGR 1.0% 4.1% 0.5% Western Eastern Europe Europe North America CAGR CAGR 2,7 % 4.3% Asia2010-2020Million tonnes South Middle East & America Africa Source: Pöyry and Stora Enso Mats Nordlander 22 March 2012 10
  11. 11. • EUR 137 million in a new power plant to secure efficient energy supply completed Ostroleka • EUR 285 million in a new RCP containerboard machine • Planned production 455 000 t/a, net impact 370 000 t/ainvestments • Focusing on modern lightweight product • Majority to be consumed internally • Raw material integration from 35% to 60% • Acquisition of Inpac International completed in July 2011 Inpac • Strengthens existing relationships with global key customers by providing packages directly in Chinaacquisition • Brings synergies with existing consumer packaging business in Europe Other • • Restructuring in Finland Quality investments • Increasing capabilities in packaging design actions • Expansion in Russia Mats Nordlander 22 March 2012 11
  12. 12. Strongest growth in demand of virgin fibre- based consumer board will be in Asia CAGR CAGR CAGR 1.4 % 4.6 % 0.2 % CAGR 6.9 % Western Eastern Europe Europe North CAGR America 3.3 % CAGR 3.5 %2010-2020 Middle East & AsiaMillion tonnes Africa South Fibre-based CAGR consumer board America consumption China 9% Pakistan 9% India 6% Middle East 4% Source: Pöyry and Stora Enso Mats Nordlander 22 March 2012 12
  13. 13. Consumers start to buy packaged food once annual family income reaches USD 5 000 Population in households with annual Population in China in households withdisposable income USD 5 000+ (global) annual disposable income USD 5000+ 2002Annual growth 2.8% CAGR 2010-2020 Annual growth 4.7% CAGR 2010-2020 Mats Nordlander 22 March 2012 13
  14. 14. India, China and Pakistan estimated to drive growth in terms of milk volumesConsumption estimate for Liquid Dairy Products 10% 9,0% 9% 8% Total Global LDP 7% average growth rate: 6% CAGR 2010 - 2012 2.4% 5% 4% 3,2% 2,8% 3% 2,1% 2% 1,5%1,2% 1% -0,1% -0,4%-0,3% -1% -2% -3% -2,8% -4% -5% Volume 57.4 33.7 25.9 22.6 12.8 11 7.7 6.7 5.6 5.1 2012 Bil Litres Source: Tetra PakSource: Index 2009 Dairy Tetra Pak Mats Nordlander 22 March 2012 14
  15. 15. Accelerate what worksEvery third beverage carton in the world is produced fromStora Enso materials! Mats Nordlander 22 March 2012 15
  16. 16. Stora Enso to build world-class pulp andconsumer board mill in Southern China Integrate including: •Paperboard mill of 450 000 tonnes •Pulp capacity of 900 000 tonnes •Energy plant •Auxiliary facilities Unique set-up: the pulp and board mills to be integrated with 120 000 hectares of self-managed eucalyptus plantations Target to expand the paperboard capacity to 900 000 tonnes at a later stage Operations expected to start during Q4/2014 Mats Nordlander 22 March 2012 16
  17. 17. Focusing on high quality segments in China Unique Chinese platform position for growth • A world leading position • Unique integrate • Technologies and • Established footprint specifications • Innovations • Committed customers Well prepared project to accelerate profitable growth Mats Nordlander 22 March 2012 17
  18. 18. Total investment approximately EUR 1.6 billion Mats Nordlander 22 March 2012 18
  19. 19. Mats Nordlander 22 March 2012 19
  20. 20. Independent sustainability impact studies give solid platform for the project • UNDP’s Environmental and • Occupational Health and Safety Social Impact Analysis (ESIA) Certificate ISO 18001 in 2006 • Environmental Management • Additional integrated ESIA in System ISO 14001 2012 • Quality Management System ISO 9001 Mats Nordlander 22 March 2012 20
  21. 21. Key takeawaysRenewable packaging - Solution for the future! Focus on profitable growthClear priorities to accelerate what works Growing by expanding in China •Serving mainly global customer base •Integrated low cost production from domestic self-managed tree plantations to end product •Serving demanding customers’ proven know how Mats Nordlander 22 March 2012 21
  22. 22. Growth Engine Mats Nordlander 22 March 2012 22
  23. 23. Mats Nordlander 22 March 2012 23
  24. 24. Stora Enso’s Operations in China Personnel currently about 4 500 in China Dawang Mill Uncoated magazine paper (170 000 tonnes) Beijing Suzhou Mill Coated fine paper (245 000 tonnes). Customers include merchants and printing houses Shanghai Two core board factories Hangzhou and Foshan Beihai Hong Kong 5 Sales branches Dongguan and Qian’anEucalyptus plantations (Inpac)(90 000 ha)Guangxi (since 2002) Mats Nordlander 22 March 2012 24
  25. 25. It should be noted that certain statements herein which are not historical facts. including. without limitationthose regarding expectations for market growth and developments; expectations for growth and profitability;and statements preceded by “believes”. “expects”. “anticipates”. “foresees”. or similar expressions. are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995.Since these statements are based on current plans. estimates and projections. they involve risks anduncertainties which may cause actual results to materially differ from those expressed in such forward-lookingstatements. Such factors include. but are not limited to: (1) operating factors such as continued success ofmanufacturing activities and the achievement of efficiencies therein. continued success of productdevelopment. acceptance of new products or services by the Group’s targeted customers. success of theexisting and future collaboration arrangements. changes in business strategy or development plans or targets.changes in the degree of protection created by the Group’s patents and other intellectual property rights. theavailability of capital on acceptable terms; (2) industry conditions. such as strength of product demand. intensityof competition. prevailing and future global market prices for the Group’s products and the pricing pressuresthereto. price fluctuations in raw materials. financial condition of the customers and the competitors of theGroup. the potential introduction of competing products and technologies by competitors; and (3) generaleconomic conditions. such as rates of economic growth in the Group’s principal geographic markets orfluctuations in exchange and interest rates. Mats Nordlander 22 March 2012 25
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