Suominen Corporation has released its fourth quarter and full year results for 2008. The company generated net fourth quarter sales of €49.8 million, a drop from €54.1 during the year-earlier quarter. Net sales for the full year totaled €214.6 million, down from €215.2 in 2007. The company saw a quarterly loss of €4.4 million, an improvement over last year’s fourth quarter loss of €9.7 million. For the full year, Suominen’s loss totaled €7.2 million compared to €10.1 million in 2007. Despite its disappointing overall performance, cash flow from operations was positive, at €18.9 million.
While Suominen’s wipes business suffered a loss, its flexibles business was slightly in the black. Net quarterly sales of its wipes business totaled €138.5 million, an increase of nearly 1% from the corresponding period in 2007. The business area’s operating profit after impairment losses and non-recurring costs was -€4.8 million compared to -€8.8 a year ago. Before these deductions, operating profit was -€0.7 million versus -€0.4 during the final quarter of 2007. According to the company, the organizations within the business area were streamlined and individuals responsible for sales and production and other management within both units will now report directly to the head of the business area. The general manager of the Nonwovens unit resigned in conjunction with the reorganization.
Net sales of Codi Wipes, at €72.4 million, grew by 3% from the previous year. Delivery volumes grew in personal care and moist toilet wipes. In baby wipes, delivery volumes fell compared to the previous year. Average sales prices continued to fall as expected, partly due to changes in the sales mix, and partly due to lower contract prices. Despite the growth in volumes, the targets set for increasing sales to new customers and new product applications were not met.
Net sales of Nonwovens decreased by 1% to €76.3 million. Delivery volumes fell by 7%. Deliveries of thermal bonded material for hygiene products increased significantly, while those of hydroentangled
nonwovens to Europe increased and deliveries to the U.S. market fell. There was an increase in internal deliveries. At the end of the year, deliveries of nonwovens fell significantly compared to the previous months, due to U.S. deliveries drying up, and the worsening of the general economic situation. Average sales prices were slightly higher than the year before, with higher raw material costs being reflected in sales prices.
During the period under review, efficiency-enhancement measures continued to focus on cost savings. The company reported that lower than planned volumes and increased waste took their toll on the gains generated by these continuous improvements. Sales and product offering programs promoted new sales, although not to the extent targeted. During the period under review, cost savings and efficiency measures generated some €6 million. Cash flow has been strengthened by the reduction in working capital and the withdrawal from investments, undertaken as part of the enhancement program.