Suominen: Challenging start for 2023

Challenging start for 2023

(Source: Sominen)
(Source: Sominen)

For Suominen the beginning of 2023 has been challenging. The company expects that its comparable EBITDA (earnings before interest, taxes, depreciation and amortization) in 2023 will increase compared to the previous year. In 2022, Suominen’s comparable EBITDA was €15.3 million.
Even though the raw material prices started to decline in the first quarter (Q1) of 2023, they are still significantly higher than in the comparison period. Net sales for Suominen Corp., Helsinki/Finland, increased by 6% from the comparison period to €116.8 million in Q1/2023. Sales prices increased and sales volumes were at the same level as in the comparison period despite the strikes in the Finnish ports and at the Mozzate plant in Italy.
Suominen Corp., Helsinki/Finland, has 2 business areas, Americas and Europe. In January–March 2023, net sales of the Americas business area were €75.0 million and net sales of the Europe business area were €41.8 million.
EBITDA in Q1/2023 declined to €2.6 million (2022: €3.3 million). Raw material costs increased more than the sales prices which react to the cost increases with a lag due to the company’s price mechanism.
The near future continues to look challenging, and the competition is fierce. The market remains unstable, and the same applies to raw material, energy and freight costs. However, Suominen is more optimistic about the second half (H2) of the year. The raw material prices declined in Q1/2023 from the previous quarter (Q4/2022) and it seems that the raw material prices remain close to Q1/2023 level in the foreseeable future. It remains to be seen how the current economic climate impacts the end consumer demand and consumer preferences regarding wipes. Historically, the wipes market has been rather steady despite the general economic situation. All in all, it is expected that comparable EBITDA in 2023 will increase from 2022.

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