Sappi Ltd. Foresees Surge in Profits During Q2 FY21

SEATTLE (Scrap Monster): Sappi Limited announced results for Q1 FY21. The company reported continued recovery in results during the quarter.

The EBITDA excluding special items stood at $98 million during the quarter. This compares with $139 million during Q1 FY20. The net debt increased from US$1,916 million a year before to $2,056 million. The quarter reported loss of $17 million, as compared with Q1 FY20 profit of $24 million.

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The overall improvement during the quarter was mainly on account of faster-than-expected recovery of dissolving pulp (DP) markets and graphic paper demand in North America. However, these were partially offset by impacts of maintenance shutdowns at Ngodwana and Somerset mills. Meantime, the DP sales volume was still down from the same quarter last year by 16%. Also, the graphic paper sales were well below the year ago levels, the company press release said.

Commenting on the results, Steve Binnie, CEO, Sappi limited noted that the company is pleased with the continued recovery in results over the past nine months. The recovery is on track despite the ongoing negative impact of Covid-19. The profitability across all reporting segments exceeded expectations. Looking forward, the profitability in the second quarter may see improvement relative to first quarter, he added.