Strong global dissolving pulp and speciality packaging performance have allowed Sappi to deliver better results for the first half of 2017.
For this quarter, its earnings before interest, tax, depreciation and amortization (EBITDA) was $208m, compared to $195m for the same period last year.
For the half-year, the company's EBITDA stood at $409m, compared to $370m, last year of the same period.
On the other hand, profit decreased from $100m last year and fell to $88m for this quarter and for half year, it increased from $175m to $178m for the half year.
Sappi’s CEO Steve Binnie stated that the company delivered solid results in spite of a change in its strategy to emphasise on dissolving pulp and specialty packaging. The company also emphasised on reducing its high variable costs and to place itself in a stronger position by 2020.
He said: “Our projects to increase capacity of speciality packaging in Europe and North America are progressing as planned. Capital expenditure in 2017 is expected to be approximately $350m. This includes the next phase of the dissolving pulp debottlenecking projects at Ngodwana and Saiccor Mills, the Somerset Mill wood-yard and the initial phases of the speciality packaging conversions.
“Sappi’s Biotech business is also progressing well, with the opening of a second-generation pilot plant for sugar extraction at our Ngodwana Mill in South Africa just after quarter close and the signing of a global sales agreement with Cellmark of Sweden for our Lignosulphonate products.”
The company also stated that due to increased demand for its specialised cellulose and higher demand for its specialty packaging in the US and Europe. In its home market, South Africa, the company recovered its sales for this quarter, compared to both comparative periods.