Key message: Across various grades, including pulp, graphic paper, containerboard, and specialty papers, there is a trend of price increases or stability in Europe, driven by factors such as improved demand, production cost pressures, and logistical challenges.
Key message: We maintain an overweight position on Mondi, anticipating improving profitability in 2024, as destocking nears completion and producers aim for price hikes amid improving industry fundamentals.
Key message: Sappi’s Q1 24A results were bolstered by a change in accounting policy and a one-off energy subsidy, reflecting positively in reported EBITDA figures. Adjusting for these factors, EBITDA was closer to $112 million, providing a clearer view of underlying operational performance. Looking ahead, the company anticipates gearing to pick up over the next two quarters, driven by the payment of dividends, closure costs, and an uptick in capital expenditure. Sappi expects Q2 profitability to be in line with Q1.
Sappi will release Q1 24E results tomorrow at 8am, with a conference call at 4pm. Sappi will also host its AGM tomorrow at 2pm.
Sappi’s AGM will be held on Wednesday, 07 February 2024 at 14:00: The last day to trade in order to be eligible to attend and vote at the AGM is Tuesday, 30 January 2024.
Key message: Pulp prices advance further in Europe, while Graphic Paper prices come under further pressure. Mixed moves for containerboard, and green shoots for sack kraft paper producers. Mondi special dividend and share consolidation on track. Sappi is set to redeem its R1.2bn convertible bond early and its Lanaken mill in on track to be closed by Q2 24E.
Key message: China will keep zero import tariffs on major P&B grades in 2024. Further pulp price hikes confirmed. More containerboard projects postponed and Mondi general meeting to be held on 15 January.
Key message: It’s a wrap for 2023. Thank you for your continued support. Hope you have a healthy and happy festive season and all the best for 2024!!!!!!!
Key message: Pulp prices continue to edge up. Graphic paper stable, while containerboard prices soften 1-2%. Gas futures in Europe are currently trading at €36/MWH.
Key message: Results confirmed that profitability remains under pressure, however earnings have been more defensive than Mondi and Smurfit Kappa. Box volumes remain in the red, but the worst appears to be over, and destocking is largely complete.