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Newsgrafik #119308

Year-End Report for Duni AB (publ) 1 January – 31 December 2017  (Company news)

Stable quarter despite strongly increasing raw materials prices

1 October – 31 December
-Net sales amounted to SEK 1,254 m (1,234). Adjusted for exchange rate movements, net sales increased by 1.9%.
-Earnings per share after dilution amounted to SEK 2.55 (2.41).
-The price compensation has not fully offset record-high levels of pulp prices.
-A stable quarter with strong results in Consumer and Meal Service.
-Duni adopts an investment in airlaid capacity for around SEK 50 m for the subsidiary Rexcell Tissue & Airlaid AB. The investment is planned for completion of installation during Q2 2018.

1 January – 31 December
-Net sales amounted to SEK 4,441 m (4,271). Adjusted for exchange rate movements, net sales increased by 3.0%.
-Earnings per share after dilution amounted to SEK 6.99 (7.06).
-Net debt was higher than in the previous year, which is mainly due to acquisitions and an increase in investments.
-The Board of Directors proposes dividend of SEK 5.00 (5.00) per share.
-Acquisition of Sharp Serviettes in New Zealand.
-An investment of SEK 55 m in a logistics property in Germany.

CEO Johan Sundelin (photo) comments:
“Sales in Q4 2017 amounted to SEK 1,254 m (1,234). The sales increase is primarily attributable to the acquisition of Sharp Serviettes in New Zealand during Q2. Excluding acquisitions, sales are generally at the level of the previous year. Operating income was SEK 169 m (171). The slightly lower result is mainly related to strongly increasing raw materials prices, primarily for paper pulp, which cannot yet be sufficiently compensated by market price adjustments. Net income after tax for the quarter was SEK 121 m (113), which is the highest net income ever in a single quarter.

Net debt at the end of the quarter amounted to SEK 855 m. During the last two years, Duni's net debt has increased by around SEK 280 m. This increase is a consequence of the acquisition of Terinex Siam and Sharp Serviettes, as well as a high investment level to strengthen the Group's production and logistics capacity. Nonetheless, the financial position is still strong, with a net debt ratio to the profit before amortization of 1.36 (1.20).

During 2017, great efforts were made to strengthen Duni's delivery capacity. This was affected negatively, however, by capacity shortages in the logistics markets, primarily in Central Europe. Measures to safeguard capacity and delivery capacity will therefore take continued high priority in 2018.

The Table Top business area reported net sales of SEK 641 m (645) and operating income of SEK 121 m (125). Sales were relatively stable in most markets, but with some reduction in the UK and in certain Central European markets. The somewhat weaker result is mainly related to the record-high paper pulp prices. The achievement of price compensation in relation to the market is therefore the most important action for the business area at the start of the new year.

The Meal Service business area increased its net sales to SEK 179 m (171) and its operating income to SEK 7 m (6). After a relatively weak Q3, the business area has now regained its previous growth rate. It is pleasing to note that the market investments which took place during the second half of 2016, which burdened the business area's result for the year, are now beginning to have a positive impact. The business area's growth is mainly attributable to the environmentally-conscious range, for which innovation and product development continue to be very important.

Yesterday, 8 February 2018, Duni acquired 75% of the shares in Biopac in the UK. This is our first acquisition in the Meal Service business area. The company has annual sales of approximately SEK 55 m and is solely focused on sales of environmentally-customized meal products, which was an important consideration for the acquisition.

The Consumer business area’s net sales fell to SEK 317 m (331) while its operating income increased to SEK 32 m (28). The main reasons for the improved result are a low cost level and a more favorable product mix. Like the Table Top business area, Consumer was affected by the high pulp prices. This makes price compensation towards the market a very high priority.

The New Markets business area increased its net sales to SEK 96 m (73) while its operating income fell to SEK 7 m (10). Sales increased mainly as a consequence of the acquisition of Sharp Serviettes, while organic growth was also favorable. During the year, the business area achieved several market investments and organizational improvements, to ensure continued strong organic growth. These investments explain the reduced operating income during the quarter. The primary focus during 2018 is driving growth continuously.

After my first quarter as President and CEO of Duni, and after meeting many of Duni's employees, I can note that Duni is ready to meet the future opportunities and challenges. I therefore look forward with confidence to building a stronger Duni, together with the entire organization,” says Johan Sundelin, President and CEO, Duni.
(Duni AB)

Newsgrafik #119310

Heidelberg and WEIG implement new digital business model for folding carton printing  (Company news)

-Heidelberg supplies complete package comprising presses, software, services, and consumables under subscription agreement
-Industry 4.0 solution ensures excellent availability and productivity across entire system
-WEIG can achieve growth targets based on state-of-the-art technology

Growth is on the cards for folding carton producer FK Fürther Kartonagen, which forms part of the WEIG network of companies. In creating a new digital business model, WEIG is drawing on the experience, advice, and technology of Heidelberger Druckmaschinen AG (Heidelberg).

Photo: WEIG Packaging opts for Heidelberg subscription model: (from the left) Siegfried Mahr, Managing Director of WEIG Packaging, Dr. David Schmedding, Head of Corporate & Digital Business Development at Heidelberg, Mike Niebuhr, head of the folding carton plant in Emskirchen, Toni Steffens, Commercial Director of WEIG Packaging, Markus Rinkens, head of procurement at WEIG Group, Harald Degen, Branch Heidelberg Munich and Dirk Kummer, Heidelberg Munich Branch Manager.

“We’re looking to turn our Emskirchen site into a folding carton business that leads the way when it comes to availability and flexibility. We’re therefore entering into a partnership with Heidelberg in which our strategic and business interests are aligned. Under the new business model, Heidelberg will no longer make its money by supplying press components, but solely by achieving agreed productivity and growth targets,” explains Toni Steffens, Commercial Director of WEIG Packaging.

The Heidelberg subscription model follows the growing pay-per-use trend in mechanical engineering and aims to move away from growth based solely on selling and installing printing capacity.
(Heidelberger Druckmaschinen AG)

Newsgrafik #119347

Archroma introduces Leucophor® MT, a new cost-effective optical brightening agent ...  (Company news)

... for high whiteness surface applications

Picture: Archroma’s production facility of tetrasulfonated optical brightening agents near Barcelona, Spain. (Photo: Archroma)

Archroma, a global leader in color and specialty chemicals, today announced the introduction of Leucophor® MT liq, a new tetrasulfonated optical brightening agent (OBA) modified to give high whiteness performance in surface applications.

The application of optical brighteners to the surface of paper is usually done by using either hexasulfonated OBAs, when high whiteness levels are required, or tetrasulfonated OBAs, when standard levels of whiteness are sufficient.

With the increasing costs of some of the key raw materials needed to manufacture hexasulfonated OBAs, Archroma asked its R&D experts to develop a tetrasulfonated agent for surface applications that would give comparable levels of whiteness to hexasulfonated grades.

The outcome is Leucophor® MT liq, a REACH-registered, urea-free, modified tetrasulfonated OBA that offers papermakers a new, cost-effective option to achieve high whiteness levels in a surface application, especially at the size press.

Leucophor® MT liq is produced in Archroma’s OBA production facility near Barcelona, Spain, which was extended in 2017 to raise capacity to meet the demands of its European customers.

Andrew Jackson, Product Manager OBAs, Archroma Packaging & Paper Specialties, commented: “With Leucophor® MT liq, we are able to offer a new alternative to both standard tetrasulfonated and hexasulfonated optical brighteners for use in surface applications. This new portfolio option underlines once again Archroma’s continuous commitment to delivering innovation and cost efficiency to our customers, and confirms our position as the leading supplier of OBAs to the paper industry.”
(Archroma Management GmbH)

Newsgrafik #119193


This year’s calendar of events and supporting activities offered by the international association for the label and sleeve markets, FINAT, is a full one. It reflects, and addresses, the complex and ever-changing opportunities and challenges in the overall world of packaging today for the benefit of the FINAT membership which, in itself, is a diverse web of companies, from raw material suppliers through inks, printing and application machinery, to converters and contract packers.

Tackling the technical challenges
First on this year’s agenda of international events is the FINAT Technical Seminar – a two-yearly event which attracts high attendances for its astute combination of all the key elements of commercial label production today. Taking place in Barcelona on 7-9 March, this year’s seminar addresses a broad range of topics for printers and converters. Setting the context, keynote speaker Andy Hobsbawm, founder of smart products platform EVRYTHNG, will provide a leading-edge insight into the IoT, and how ‘smart’ products transform brand relationships, business operations, and service experiences.

The programme will go on to address choosing an MIS supplier; the digital print technologies – both stand-alone and in combination with flexo; workflow automation; inks and decoration techniques; and facestocks and finishing. As well as the formal presentations, the seminar will feature parallel troubleshooting workshops where participants can address two arenas of current technical focus and relevance: the flexible packaging and sleeving technologies, and multi-layer, peel-and-reveal label constructions. The event’s accompanying tabletop exhibition and social programme also, of course, offer exceptional opportunities for networking across the extended label industry value chain.

European Label Forum
FINAT’s annual industry event, the European Label Forum, travels this year to Dublin, Ireland, 6-8 June. As in previous years, the program covers a range of issues relevant to the European labels and narrow web packaging industry. Topics on this year’s agenda include the European label industry after Brexit, diversification of the labels and narrow web industry, intelligent packaging, talent development, total cost of ownership of the different printing technologies, the state of affairs in digital label printing, the latest innovations in brand protection, online marketing of your company, as well as the impact of upcoming legislation in food compliant packaging as well as serialization and tamper evidence. Keynote speakers confirmed include TV commentator and spokesman of former British PM Tony Blair, Alastair Campbell, founder of XYZ University, author and expert on intergenerational issues in companies Sarah Sladek, and Professor Noreena Hertz, author, visionary economist, decision-making guru and author with an impressive track record in predicting global trends.

FINAT International Label Competition
The ELF also provides the platform for the prize presentations in the 2018 FINAT International Label Competition. This long-established and prestigious competition – now accepting entries, but closing 23 March (link to entry form) – features a number of technical and marketing/end use categories. For the first time this year, it includes flexible packaging – since it is now an additional option offered by many label converters.

The competition creates a ‘shop window’ of the label industry, and brings recognition and international press coverage for winning companies.

Succession planning
A third live event on the FINAT calendar takes place on 5-7 September in Bucharest, Romania: the FINAT Global Young Managers’ Congress 2018. This creative FINAT initiative represents an opportunity for younger-generation print managers across the globe – whether FINAT members or not – to come together to focus on management skills development in the fast-moving packaging print arena, where a continuing flow of new-generation expertise is essential for the industry’s future.

Technical webinars
Throughout the year, FINAT will host a programme of free-to-attend webinars for members, focussed on technical and recycling matters. Scheduled subjects include intelligent packaging, self-adhesive label dispensing, and RecyClass – the recyclability tool for plastic packaging offered by Plastic Recyclers Europe. One of the subjects covered is the circular economy strategy for plastics, being one of the major substrates for labels, with a webinar dedicated to the general recycling strategy, followed by more detailed webinars on best practices for packaging and label design, and new label marker technologies for better polymer sorint at the recyclers.

The association’s website is also home to in-depth market research, published twice a year for the benefit of members in the FINAT RADAR. The summer 2018 edition will feature detailed statistics on the European labelling industry, and the year-end edition will focus on brand owners.

Confirmation of the high levels of service FINAT has provided to its members is the fact that the association will be celebrating its 60th anniversary in November 2018. Officially established in 1958, FINAT represents unique historical documentation of the self-adhesive label industry from its inception, and is now supporting, and promoting that industry’s ever-widening profile in the world of packaging.

Newsgrafik #119298

Domtar Financial Report: Q4 and Fiscal Year 2017  (Company news)

Our preliminary financial report for fourth-quarter and fiscal year 2017 is in. Highlights from this Domtar financial report include:
-Fourth quarter 2017 net loss of $5.42 per share; earnings before items listed below of $0.64 per share
-Price increases announced for pulp and several uncoated freesheet grades
-A 4.8 percent dividend increase

Quarterly Review
Domtar reported a net loss of $340 million ($5.42 per share) for the fourth quarter of 2017 compared to net earnings of $70 million ($1.11 per share) for the third quarter of 2017 and net earnings of $47 million ($0.75 per share) for the fourth quarter of 2016. Sales for the fourth quarter of 2017 were $1.3 billion.

Excluding items listed below, Domtar reported earnings of $40 million ($0.64 per share) for the fourth quarter of 2017 compared to net earnings of $65 million ($1.03 per share) for the third quarter of 2017 and net earnings of $47 million ($0.75 per share) for the fourth quarter of 2016.

Operating loss was $512 million in the fourth quarter of 2017 compared to operating income of $89 million in the third quarter of 2017. Depreciation and amortization totaled $82 million in the fourth quarter of 2017.

Excluding items listed below, operating income was $59 million in the fourth quarter of 2017 compared to a net operating income of $83 million in the third quarter of 2017.

Fourth Quarter 2017 Items:
-Non-cash goodwill impairment charge associated with Personal Care of $578 million ($573 million after tax)
-Closure and restructuring costs of $2 million ($1 million after tax)
-Deferred tax benefit of $186 million related to the U.S. Tax Cuts and Jobs Act of 2017 (U.S. Tax Reform)
-Net gain on disposal of property, plant and equipment of $9 million ($8 million after tax)

“As expected, higher maintenance and seasonally higher operating costs impacted our fourth quarter Pulp and Paper results,” said John D. Williams, President and Chief Executive Officer. “Nevertheless, pulp price realizations were higher, and we shipped record volumes of tissue grade and fluff pulp. Recently announced price increases across a number of pulp and paper grades are expected to drive continued momentum into 2018.”

Commenting on Personal Care, Williams added, “While we had good results in 2017, we have concluded that the performance of our Personal Care business will continue to be impacted by an increasingly competitive market. We remain optimistic about the long-term growth trajectory of the absorbent hygiene market; however, this increasingly competitive market will negatively impact our sales, and we expect the environment to remain challenging for the foreseeable future. Importantly, the goodwill impairment charge is non-cash. It does not alter our current financial flexibility, and our overall cash generating capabilities remains strong.”

Fiscal Year 2017 Highlights
As a result of its annual goodwill and indefinite life intangible assets impairment tests, Domtar recorded a non-cash goodwill impairment charge of $578 million associated with Personal Care. Growing competitive market pressures in the healthcare and retail markets over fiscal year 2017, including the entry of new competitors in the private label category, excess industry capacity and the decline of healthcare spending by governmental agencies, are expected to result in lower than previously anticipated sales and operating margins. In light of this weakened market outlook, our current business forecast was not sufficient to support the carrying value of the goodwill associated with Personal Care, leading to the impairment.

Commenting on the fiscal year 2017 results, Williams said, “We generated nearly $450 million of operating cash flow and continued our solid track record of rewarding shareholders with a high payout ratio while maintaining financial flexibility. Our performance, combined with our confidence in our cash flow generating capabilities, enables us to announce a 4.8 percent dividend increase. Looking ahead, we remain focused on maximizing long-term profitability and value creation.”

In 2018, costs, including freight, labor and raw materials, are expected to marginally increase. Our paper shipments should benefit from expected industry capacity closures, while paper prices should improve following the recently announced price increases and pulp will benefit from volume growth in fluff. Personal Care is expected to be negatively impacted by an unfavorable tender balance, resulting in lower volume and operating margins.
(Domtar Inc.)

Newsgrafik #119300

XcelLine from Voith: Highest performance from the full-line supplier for tissue production  (Company news)

-Increase in demand for XcelLine tissue machines since 2015
-Outstanding technology coupled with easy use
-Voith is a full-line provider, from financing to service

Photo: In October, Voith Paper completed the commissioning of the new XcelLine tissue machine VTM 3, which will be delivered to the tissue and special paper manufacturer Little Rapids Corporation, located in Shawano, Wisconsin, USA.

The XcelLine paper machines from Voith make the production of tissue paper significantly more efficient. Since 2015 customers around the world have purchased over 20 machines, including the world’s fastest tissue machine with a steam-heated dryer hood.

Just at the end of August 2017, The Navigator Company, one of the leading pulp and paper manufacturers in Europe, signed a contract with Voith for the delivery of a new XcelLine machine for the production of tissue paper. Voith continues the success of their XcelLine with the machine, which will start production in the second half of 2018. Since 2015, the company has sold over 20 new machines to manufacturers of sanitary paper and received numerous orders for the modernization of machines with XcelLine components. A clear indicator that producers around the world are also expecting increased demand for tissue in the coming years. The global paper market study “World Paper Markets up to 2030” by Pöyry Management Consulting also confirms the upward trend. According to the study, the annual demand for tissue and hygiene products should increase by up to 2.9 percent worldwide.

The high demand for Voith XcelLine tissue machines proves the great trust in and satisfaction manufacturers have with the new generation of paper machines from Voith. After all, every component in the XcelLine is designed to ensure maximum efficiency with a minimum amount of energy used. Through faster production, for example. The new line for The Navigator Company is designed for an operating speed of 2,000 m/min. This is state-of-the-art technology. The equipment includes numerous components and systems which increase energy efficiency and user-friendliness, such as a Pluralis refining system, a MasterJet headbox, a steel EvoDry T Yankee dryer cylinder and an EcoHood T dryer hood. Delivery also includes Papermaking 4.0 functions, with the integration of the ComCore automation platform. These digital technologies make it possible to optimize machine efficiency, reduce energy costs and increase paper quality and process reliability. Above all, process stability is desired in many booming markets. “The demand for tissue is growing strongly in countries where manufacturers often have difficulty finding qualified employees. That is why we put great value on the simple and safe operation of our machines and also offer extensive training,” explains Dr. Martin Tietz, Global Product Manager Tissue at Voith.

The basic principles of the Voith engineers promise a smooth project course to the customer. Impressive success stories were the fast commissionings of four XcelLine machines at Lee & Man in China in 2017. There, it took only 4 days for the TM 12 to be able to produce at maximum speed. The TM 11 started up in a new record time as it took only 18 minutes from “stock on wire” to “paper on reel”.

The TM 16 for Cheng Loong in Taiwan, which went into operation in 2016, also set new technical standards. With a steam-heated dryer hood, it produces up to 2,001 meters of tissue every minute, making it the fastest machine of its kind. This steam-heated dryer hood is just one of many innovations from Voith which increase paper quality and manufacturing efficiency. Many of these developments have long since become standard in production for many tissue manufacturers. For example, the shoe press which other paper machine manufacturers either build under license or purchase directly from Voith.

Along with outstanding technology, good project management in the construction of new machines plays a crucial role for fast commissioning. The new VTM 3 for Little Rapids was able to go into production in October 2017, six days before the contractually agreed-upon date, while the machine’s downtime from paper to paper was just 30 days – that’s from the dismantling of the previous machine to the construction and startup of the new machine. In addition to this extraordinary performance, the second jumbo roll was already of marketable quality, and the machine reached its maximum operating speed within the first week of operation. “We are very proud of the teamwork from everyone involved to execute the new construction inside a very tight time frame. Furthermore, the performance we observed in this early phase of commissioning the machine is extremely promising, and we are optimistic that our customers will appreciate the additional capacity and improvements in quality we have achieved with this investment,” said Ron Thiry, Vice President and General Manager of Little Rapids Corporation.

The reason for the smooth commissioning and high customer satisfaction is largely the project and product management of the Voith engineers. Under the heading Process Line Package (PLP), customers can purchase a new machine practically ready to use. The package includes all the components and units necessary for operation, as well as extensive training for employees. Voith also offers solutions for financing a project. The Voith Corporation’s vast experience with major projects all over the world simplifies the creation of a tailored financing framework for customers. Voith will also accompany the entire lifecycle of an XcelLine machine with a broad range of services. Particularly with the OnSite Yankee Service, Voith offers numerous technologies which ensure extensive, reliable and quickly available service directly on site with a customer.

In the Tissue Technology Center in São Paulo, Brazil, Voith customers can get their hands on a modularly constructed test machine that covers the entire product range – from standard to structured premium grades. It is also equipped with a stock preparation and a water treatment system. New tissue products undergo targeted development and are brought to marketability with customized test series. For over 20 years, Voith has offered its customers unique opportunities for testing new technologies, thus reducing investment risks.
(Voith Paper GmbH & Co KG)

Newsgrafik #119301

KapStone Reports 2017 Fourth Quarter And Full Year Results  (Company news)

KapStone Paper and Packaging Corporation (NYSE:KS) reported preliminary results for the fourth quarter and year ended December 31, 2017.

As compared to 2016's fourth quarter, results for 2017's fourth quarter:
-Net sales of $859 million, up $81 million, or 10 percent
-Net income of $188 million, up $169 million, or 924 percent
-Diluted EPS of $1.90, up $1.71 per share, or 900 percent

Non U.S. GAAP financial measures for 2017's fourth quarter as compared to 2016's fourth quarter:
-Adjusted EBITDA of $136 million, up $44 million, or 48 percent
-Adjusted net income of $50 million, up $27 million, or 115 percent
-Adjusted diluted EPS of $0.51, up $0.27 per share, or 113 percent

As compared to the year ended December 31, 2016, results for the year ended December 31, 2017:
-Net sales of $3,316 million, up $239 million, or 8 percent
-Net income of $244 million, up $158 million, or 182 percent
-Diluted EPS of $2.47 up $1.59 per share, or 181 percent

Non U.S. GAAP financial measures for the year ended December 31, 2017 as compared to 2016's year:
-Adjusted EBITDA of $437 million, up $53 million, or 14 percent
-Adjusted net income of $130 million, up $23 million, or 21 percent
-Adjusted diluted EPS of $1.32, up $0.22 per share, or 20 percent

Matthew Kaplan, President and Chief Executive Officer, stated, "Eleven years ago, we began a journey to build a world-class paper and packaging company with the resources and skills of our largest competitors— that focused on maximization of stockholder value and that treated our customers and employees like a small, family-oriented company. On January 29, 2018, we announced signing a definitive agreement to be acquired by WestRock for $35.00 per share, subject to customary closing conditions, including KapStone stockholder approval. We believe this acquisition is a compelling transaction for our stockholders and an exciting development for both KapStone and WestRock."

Fourth Quarter Operating Highlights
Consolidated net sales of $859 million in the fourth quarter of 2017 were $81 million higher than 2016, reflecting higher prices for containerboard and corrugated products. Tons of paper sold in the paper and packaging segment increased to 731,000 tons during the fourth quarter of 2017 compared to 724,000 tons a year earlier. The Company's average mill selling price of $698 per ton in the fourth quarter of 2017 was higher by $81 per ton compared to the fourth quarter of 2016 due to the combined impact of higher export and domestic containerboard selling prices and kraft paper prices. Average mill selling prices were flat compared to the third quarter of 2017. Distribution segment sales increased by $14 million compared to the prior year quarter due to higher prices, partially offset by lower volume.

Net income of $188 million for the 2017 fourth quarter increased by $169 million compared to the 2016 fourth quarter. The current quarter includes a provisional tax benefit of $144 million associated with the passage of the Tax Cuts and Jobs Act on December 22, 2017. The tax benefit consists of a non-cash adjustment to re-measure deferred income tax liabilities at the new 21 percent federal statutory income tax rate compared to the prior 35 percent income tax rate.

Adjusted EBITDA for the fourth quarter of 2017 of $136 million increased by $44 million compared to the fourth quarter of 2016 as follows:
-$57 million due to higher selling prices,
-Higher sales volume of $3 million,
-Productivity improvements and cost savings of $10 million, and
-$6 million due to the impact of Hurricane Matthew in 2016, which did not recur.

These items were partially offset by:
-Higher compensation and benefit costs of $16 million,
-$7 million of higher planned maintenance outages, and
-Inflation of $8 million driven by higher OCC costs.

The effective income tax rate for the fourth quarter of 2017, when excluding the impact of the new tax law, was 31.4 percent compared to 32.6 percent for the fourth quarter of 2016.

Full Year Operating Highlights
Consolidated net sales for the year ended December 31, 2017, were $3,316 million, an increase of 8 percent, compared to 2016 sales of $3,077 million. The increase was due to higher prices, a better product mix and higher volumes in the paper and packaging segment. The Company's average mill selling price of $677 per ton in 2017 was higher by $54 per ton compared to 2016 due to the combined impact of higher export and domestic containerboard selling prices and kraft paper prices. Distribution segment sales increased by $31 million compared to 2016 due to higher prices, partially offset by lower volume.

Net income of $244 million for the year ended December 31, 2017 was higher than 2016's $86 million by $158 million. The increase was mainly due to a provisional tax benefit of $144 million based on the new tax law enacted on December 22, 2017.

Adjusted EBITDA for 2017 of $437 million increased by $53 million compared to 2016 as follows:
-$155 million due to higher selling prices,
-Higher sales volume and improved operating performance of $10 million, and
-$6 million due to the impact of Hurricane Matthew in 2016, which did not recur.

These items were partially offset by:
-$35 million of higher compensation and benefit costs,
-Inflation of $43 million driven by higher OCC costs, and
-Higher planned maintenance outage costs of $14 million.

The effective income tax rate for the year ended December 31, 2017, when excluding the impact of the new tax law, was 33.2 percent compared to 32.7 percent for 2016.

Cash Flow and Working Capital
Cash and cash equivalents increased by $17 million during the current quarter to $28 million at December 31, 2017. The Company generated $150 million of net cash from operating activities during the fourth quarter of 2017. Capital expenditures in the fourth quarter of 2017 were $30 million. The Company paid $10 million of dividends and made a voluntary debt repayment to reduce term loan borrowings by $80 million in the fourth quarter of 2017.

Cash and cash equivalents decreased by $1 million during 2017 compared to December 31, 2016, reflecting cash provided by operating activities of $325 million, $138 million for capital expenditures, and $34 million for a strategic investment to increase mill integration. Cash used by financing activities totaled $155 million reflecting $155 million of voluntary debt prepayments and $39 million of cash dividends paid to stockholders, partially offset by $39 million of net proceeds from the receivables credit facility.

At December 31, 2017, the Company had approximately $405 million of working capital and $486 million of revolver borrowing capacity.
(KapStone Paper and Packaging Corporation)

Newsgrafik #119302

Appvion Enters into Sale Agreement to Position Business for Long-Term Success   (Company news)

Appvion, Inc. (the "Company") announced that it has filed a motion in the U.S. Bankruptcy Court for the District of Delaware for approval of a stalking horse asset purchase agreement bid from a group of its lenders (the "Purchaser") to acquire substantially all of Appvion's assets in a sale process under Section 363 of the Bankruptcy Code.

"After evaluating options to address our capital structure and conducting extensive negotiations with our lenders, we determined that a sale would be the best path forward for Appvion," said Kevin Gilligan (photo), Chief Executive Officer of Appvion. "We expect that the sale process will be seamless for our stakeholders and will not disrupt our operations. This process will bring a timely and efficient conclusion to our restructuring and ensure that our company emerges as a healthier, financially-stable business poised to compete long term in the specialty paper market and further invest in the innovation that has made Appvion a market leader."

Gilligan continued, "We believe that launching the sale process with a going-concern offer from the Purchaser – a long-term lender to and supporter of our business – is the best option for Appvion. The transaction would maximize the value of our assets and create the optimal long-term outcome for our employees, customers, and vendors. Importantly, this transaction would result in a substantially deleveraged balance sheet for Appvion, upon which to continue executing our business strategy. We are confident that Appvion would be an even stronger partner to all of our stakeholders in the years to come as a result of this transaction."

The agreement with the Purchaser, which is subject to higher or otherwise better offers, provides a total consideration of $325 million plus the assumption of substantial liabilities. Pursuant to Section 363, Appvion intends to implement bid procedures to allow other qualified bidders the opportunity to submit competing bids through a court-supervised sale process.

The Court is scheduled to consider the proposed bid procedures on March 1, 2018. Appvion has requested authorization to proceed with an auction on April 23, 2018, provided the Company receives qualified overbids no later than April 19, 2018, at 4:00 p.m. (ET). The Company would then select the best bidder for the ongoing business at the conclusion of the auction, as applicable, and seek approval of the sale to the Purchaser, or the successful bidder, at a hearing shortly thereafter.

Interested bidders are encouraged to contact Alexander Rohan at Guggenheim Securities at (212) 823-6648.

As previously announced, on October 1, 2017, Appvion and certain of its subsidiaries filed voluntary Chapter 11 cases to facilitate a balance sheet restructuring and better position the business for long-term growth and success.

DLA Piper is serving as legal counsel to Appvion, Guggenheim is serving as the Company's investment banker, and AlixPartners is providing Chief Restructuring Officer services.
(Appvion Inc.)

Newsgrafik #119346

Kelheim Fibres increases prices for viscose fibres  (Company news)

Kelheim Fibres GmbH will increase prices for all viscose fibre types by a minimum of €0,10/kg with immediate effect. The European market price for caustic soda has risen by 35% since the third quarter of 2017, with extremely tight availability, and this has a direct effect on fibre production cost.

Photo: Viskosespezialität Viloft

Matthew North, Commercial Director of Kelheim Fibres GmbH comments as follows: “We have been confronted with a price increase of just under €200 per tonne, and the level of the increase forces us to adjust fibre prices accordingly.”

The Kelheim sales team will shortly be contacting customers on this matter.
All existing agreements and obligations will of course be fulfilled.
(Kelheim Fibres GmbH)