SCA has reported an increase in its tissue division’s operating profit of 47% to SEK 4,640m in its year end report.
The company put the increase down to a number of factors, including higher prices, an improved product mix, higher volumes, acquisitions, lower raw material costs and cost savings all contributed to the improvement in earnings.
Net sales for the division, which has a 49% share of the group’s net sales, increased 8% to SEK 42,375m during 2012 compared with the same time a year ago.
Sales of consumer tissue rose 21%, mainly due to acquisitions in Europe and Latin America, while a 14% increase in AfH tissue sales related to acquisition in Europe. Sales in emerging markets rose by 19%.
In 2012, SCA completed the acquisition of Georgia-Pacific’s European tissue operations and the divestment of its packaging operations, excluding the two kraftliner mills in Sweden.
It also acquired the outstanding 50% interest in the Chilean hygiene products company PISA and an additional 5% of shares in the Chinese tissue company Vinda, as well as the acquisition of Asian personal care company Everbeauty.
SCA group’s net sales increased 5% to SEK 85,408m, while operating profit rose 12% to SEK 8,646m.
President and chief executive Jan Johansson said: “The Georgia-Pacific acquisition boosts our competitive strength in the European tissue market and complements our market positions.
“The acquisition will lead to annual cost synergies of EUR 125m, with full effect from 2016.”