Upbeat RusForest keeps watching brief on Ukraine
4 April 2014 by 'A revolution is taking place at Westpac'RusForest, the Swedish forestry company operating in Russia, says it has reached a turning point in its fortunes and is on course to move back into the black.
RusForest said restructuring, the sale of non-core assets and an improvement in its operations had helped cut losses in earnings before interest, taxes, depreciation, amortisation and non-recurring items in the fourth quarter to SKr6.4m from SKr38.8m, an improvement of 83% over 2012.
The company made mention of the crisis in Ukraine, but fell short of issuing any firm analysis.
“Unfortunately, recent events between Russia and Ukraine have overshadowed the solid fundementals of our business,” said CEO Matti Lehtipuu.
Losses from discontinued operations were SKr265.6m, due mainly to an SKr220m cost of closing operations at Boguchany. RusForest’s net loss was SKr355m, compared with SKr675m.
The sawlog harvest was up 21% to 119,889m3 and production of sawnwood rose 11% to 52,470m3. The troubled sawmiller and forestry group posted huge losses of more than SKr1bn last year and restructured after a meeting of bondholders in which insolvency was threatened.
In 2012 it had harvested almost 800,000m3 of sawlogs and produced 292,590m3 of sawnwood from operations in Arkhangelsk and eastern Siberia.
“Last year was a turning point for RusForest. The restructuring transaction brought in Nova Capital as a Russian strategic shareholder and number of things have changed and improved,” said Mr Lehtipuu.
“The new 100,000-tonne a year wood pellet mill in Arkhangelsk, the sale of non-core assets and the turnaround in Magistralny (sawmill) all increase our likelihood of reaching positive cash flow later this year.”
