Suominen - Sales miss, profitability stable
Suominen reported Q2 results with revenue missing our estimate by 8%. However, the company managed a 9.3% gross margin, which was clearly above our 8.7% estimate. At first glance we see no major surprises in the sense that margins have stabilized at higher levels, yet significant nonwovens delivery volumes were also lost. Suominen also reorganized its business areas into a new geographical reporting structure (Americas and Europe).
- Q2 revenue amounted to EUR 103.8m vs our EUR 112.7m estimate. Revenue declined by 6% compared to previous year. USD strengthening relative to EUR contributed a positive EUR 3.4m.
- Gross profit stood at EUR 9.7m vs our EUR 9.8m expectation. Suominen thus managed a 9.3% gross margin, whereas we expected 8.7%.
- EBIT amounted to EUR 2.7m in Q2 vs our EUR 3.3m estimate i.e. Suominen posted a 2.6% EBIT margin (compared to our 2.9% projection).
- Until Jun 30, Suominen’s business areas were Convenience and Care. Since Jul 1, Suominen’s business areas are Americas and Europe. More than 60% of Q2 sales were attributable to Americas.
- Suominen reiterates its 2019 outlook, expecting 2019 sales at 2018 level while guiding improving operating profit.