Latest news with #paperindustry
Yahoo
22-05-2025
- Business
- Yahoo
Kuantum Papers Ltd (BOM:532937) Q4 2025 Earnings Call Highlights: Navigating Challenges with ...
Release Date: May 21, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Kuantum Papers Ltd (BOM:532937) maintained its sales and production volume in FY25 despite lower realizations. The company achieved the highest ever biomass usage at 48%, reflecting a commitment to greener operations. Significant progress in Project Nirman aimed at enhancing operational excellence through Industry 4.0 tools and automation. Mill expansion and upgradation project is on track, with purchase orders worth approximately 540 crores already issued. Development of a new copier grade paper using a higher proportion of agro pulp, aligning with sustainable manufacturing goals. The Indian paper industry faces strong headwinds due to rising raw material costs and cheaper imports from China and ASEAN countries. Operational income for Q4 declined by 7% year-on-year, and net profit decreased by 23% year-on-year. The company reported a 9% decline in operational income for the financial year ending 2025 compared to the previous year. Margins were pressured due to lower realizations and increased raw material costs. The company faces competition from the MDF industry for raw material procurement, contributing to increased wood pricing. Warning! GuruFocus has detected 3 Warning Sign with BOM:532937. Q: How is Kuantum Papers addressing environmental concerns related to water usage in paper manufacturing? A: Mr. Bhavan Kean, Vice Chairman and Managing Director, explained that while paper manufacturing does consume water, Kuantum Papers treats this water in state-of-the-art treatment plants and provides it to surrounding villages for irrigation. The company has also reduced groundwater usage by sourcing water from a nearby dam, thus mitigating environmental impact. Q: Is there any restatement of previous quarters' volume numbers? A: Mr. Vikram Keta, Chief Financial Officer, clarified that previous reports included byproducts like pulp in sales figures. Moving forward, only paper sales will be reported, which explains the apparent decline in volume. Q: What is the outlook for writing and printing paper prices in the short term? A: Mr. Bhavan Kean indicated that prices are expected to increase due to rising international wood prices and recent increases in board paper prices. A 6-7% price increase is anticipated, which would benefit the industry. Q: How will Kuantum Papers utilize its expanded capacity post-March 2026? A: The company plans to commission upgrades to its paper machines by March 2026, with full capacity utilization expected by the 2026-27 financial year. The existing dealer network is expected to absorb the increased production. Q: What is the company's stance on dividend policy and potential entry into new segments like molded cutlery? A: While there is no concrete dividend policy, the board is aware of the need to provide returns to investors. Currently, the focus is on completing the ongoing CapEx projects, and there are no immediate plans to enter new segments like molded cutlery. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Reuters
19-05-2025
- Business
- Reuters
India's JK Paper profit plunges as higher costs, imports squeeze margins
May 19 (Reuters) - Indian paper and packaging board maker JK Paper ( opens new tab reported its seventh consecutive quarter of lower profits on Monday, as high prices of wood pressured its margins. The company's consolidated net profit plummeted 72.4% from a year earlier to 762 million rupees ($8.9 million) for the quarter ended March 31. Indian paper manufacturers are grappling with the dual pressures of escalating wood prices —a key raw material—and lower-priced imports over recent quarters. The industry has appealed to the government to restrict low-quality imports and provide support amidst global tariff pressures, particularly from the United States. "Profits have been significantly impacted due to surge in imports at low prices and high wood cost," Managing Director Harsh Pati Singhania said. JK Paper's net revenue from operations declined by 1.7% to 16.90 billion rupees, while expenses increased by 10.4% to 16.09 billion rupees, primarily driven by raw material costs. This resulted in its margins shrinking to 4.7% from 15.2%. The New Delhi-based company declared a dividend of five rupees per share. Smaller rival Andhra Paper ( opens new tab posted a near-80% drop in quarterly profit earlier this month, while West Coast Paper Mills ( opens new tab and Emami Paper Mills ( opens new tab are yet to report results. ($1 = 85.4230 Indian rupees)
News24
08-05-2025
- Business
- News24
Sappi slumps almost 15% as it takes hits from SA maintenance, trade war jitters
Shares of Sappi slumped on Thursday after it reported a second-quarter loss. Global uncertainty weighed, as did a sizeable fair-value loss, as well tougher-than-expected maintenance. But the group reported positives, including some market share gains, and it is optimistic about improving conditions. For more financial news, go to the News24 Business homepage. Shares of paper, pulp and packaging group Sappi slumped almost 15% on Thursday morning after it reported a disappointing second quarter amid depressed SA wood prices, as well as longer-than-expected local maintenance shuts. Sappi reported a loss of $20 million (R365 million) for its second quarter to end March from a profit of $29 million previously. Its adjusted earnings before interest, taxation, depreciation and amortisation fell 40.5% to $107 million. The group reported a financial hit of $13 million more than expected as a result of extended maintenance at its Saiccor and Ngodwana mills due to wear and tear on equipment being worse than expected, though these issues have now been resolved. It also saw a R307 million ($17 million) forestry fair value loss amid depressed SA wood prices. Valued at about R20 billion on the JSE before the fall on Thursday, Sappi's markets include SA, Europe, North America and Asia. Coated paper is its biggest product, accounting for 40% of sales, but the group also produces specialty paper for packaging, among other things, uncoated paper as well as containerboard. North America and Europe are its biggest markets, while SA only makes up 9% of sales by destination, but still represents 26% of its sales by source. Speaking during a media call CEO Steve Binnie said despite headwinds the group did see some more positive longer-term trends, and while the US tariff push had introduced a great deal of uncertainty, it may offer strategic benefits as well. The group said direct impact of the currently proposed US trade tariffs on its business to be relatively limited. At present, less than 7% of its sales volumes involve cross-border trade with the US limiting the direct revenue exposure to tariff-related risks. Given its US footprint, 'tariffs could present a strategic opportunity as downstream participants in the value chain may increasingly shift towards domestic supply,' said Binnie. More concerning was the inflationary impact of the tariffs as well as the potential effect on trade flows, he said. 'Everybody's adopting a kind of wait and see attitude and that's had an indirect impact on the pricing of our dissolving pulp. That is our most serious concern... hopefully, this can be resolved.' 'I do firmly believe that things have to normalise. The US needs clothing, and eventually the vessels will start flowing again once again and trade will start normalising and that will help pricing,' he added. In addition, softness in wood prices is also expected to be short-term, given the long-term drive to more renewable production, he said. The group also saw positives in the form of relatively good demand for packaging and speciality paper - used for example in ecommerce - which again gave it confidence about the long-term potential of this growing market. The group reported that demand for dissolving wood pulp (DWP) remained steady during the quarter, but the typical seasonal boost in demand post Chinese New Year was not observed as textile and apparel markets slowed on the back of increasing geopolitical trade tensions and macroeconomic uncertainties. Sales volumes in the packaging and speciality papers segment increased by 9% year-on-year, reflecting a normalisation of inventory levels and modest recovery in demand in North America and SA, though overall global demand remained subdued as a result of global uncertainty. While market conditions for graphic papers remained soft, targeted efforts to grow market share delivered positive year-on-year gains, the group said. Graphic paper is an industry in structural decline amid the rise of digital media and ecommerce. Binnie said this was all about customer relationships, with the group working with key customers to consolidate its footprint, with this at the expense of weaker players, being reflective of an industry where stronger players have an edge. Sappi's shares had slumped just under 15% in mid-morning trade on Thursday, trimming its market value to about R16.8 billion. The shares had now just under halved on a one-year basis.
