The operating income was NOK 2,182 million, which is similar to the income in the second quarter of the previous year (NOK 2,186 million). The industrial goods division Timber has seen an increase in its operating income, activities in the Wood building products division are stable and the Building Systems division has seen a decline.
Better prices for industrial timber
CEO Hans Rindal is happy that the Timber division is positing positive results again.
"Better prices and a stronger Euro are two significant contributors. At the same time, there have been improvements in operations in several areas. The development appears to continue in the third quarter. This provides a good basis for our deliveries of wood-based building products to the Scandinavian market", says Rindal.
Good position in the building products market
The CEO says that the building products market is more stable because a large share of the products are used for renovations, conversions and extensions.
"We continue to improve our offerings within building products by combining a broad spectrum of good products with good distribution solutions", says Rindal. He thinks that this in sum gives the Wood building product division a good market position, including when there is less demand.
Lower levels of new construction in Sweden
Moelven is noticing a lower level of new construction in Sweden, especially in two areas: less need for new rental modules and fewer deliveries of glulam for private homes.
"Our module manufacturing companies have done a good job of establishing themselves in the market for flats, and this means that we are maintaining a higher level of activity than the last time when there was low demand in the rental market. We are noticing the decline in the market, but are still making a profit, albeit a small one. We have had to adapt costs within glulam. Our producers of interiors are supplying a greater share to the renovation, conversion and extension market, and have satisfactory profits", says Rindal.
Unfortunately, the operating result is affected by the writedown of projects in several areas of the Building Systems division, and especially in Moelven's electrical systems division. Rindal explains that Moeleven Elektro AS is currently finalising some large projects that the company should not have taken on under the current terms.
"This affects our result far too much and is unfortunately an expensive experience", he says.
Having said that, Rindal adds that there are many highly skilled employees in Moelven Elektro who complete deliveries customers are very satisfied with.
"Moelven Elektro has had a planned scaling down of project activities and is now down to an activity level the company is better able to handle", says Rindal.
Secures raw materials and chip deliveries
In the market for timber and fibre products, the closure of the paper and cellulose industry in some of Moelven's local areas has necessitated improvements in access to sidings for the railway and to increase the storage and loading capacity for industrial chips and pulpwood.
"This work is well underway and secures raw materials in the second half of the year for all units using timber, as well as deliveries of chips from these units. The effects this will have on the total timber market in the long term remains to be seen, but initially we have managed to handle this", says Rindal.
Reduced rate of investment
CEO Hans Rindal says that the Group for a longer period has been investing more than it has earned. He therefore sees it as possible and necessary to reduce investments in new equipment.
"We have completed significant investments in industrial components in the first half of the year, and are now focusing on starting production. During the third quarter we will also complete significant investments in Moelven Valåsen AB, Moelven Vänerply AB and Moelven Eidsvold Værk AS. As of the fourth quarter, we will therefore be making fewer investments and have a positive cash flow, even with ongoing difficult market conditions. The focus ahead is therefore on improvements in sales and operations", says Rindal.
For further information please contact:
CEO Hans Rindal, +47 906 96 910
CFO Morten Sveiverud, +47 909 80 667
Ass. Financial Director Rune F. Andersen, +47 913 43 260
Communications and HR Director Kristin Bjørnstad, +47 907 13 701
Communications Officer Tom E. Holmlund, +47 916 68 668
For a local angle on the situation, contact one of our businesses directly:
Building products division Wood:
Head of division Bjarne Hønningstad, mobile +47 97591201
Wood Sweden: Managing Director Mikael Axelsson, mobile +46 (0) 101225004
Moelven Denmark: Managing Director Michael Helmershøj, mobile +45 40452336
Building Systems project division:
Moelven Byggmodul AB: Managing Director Johan Samuelsson, +46 (0)10 122 55 03
Moelven Byggmodul AS: Director Lars Brede Aandstad, +47 90992851
Moelven Töreboda AB: Managing Director Johan Åhlén, mobile +46 (0) 50648189
Moelven Limtre AS: Director Åge Holmestad, mobile +47 (0) 95864620
Moelven Eurowand AB: Manging Director Orvar Sandelin, mobile +46 (0) 101226003
Moelven Nordia AS: Director Trygve Toften, mobile +47 90874964
Moelven Elektro AS: General Manager Atle Bergo, mobile + 47 48283400
Timber industrial products division:
Head of division Ole Helge Aalstad, mobile +47 90014343
A list of our companies at the local level is available here: