Borregaard ASA: Invitation to Q4 2024 Announcement - A Glimpse into the Company's Strategic Moves and Market Outlook

Borregaard ASA, a Norway-based biorafinery, is set to report its fourth quarter 2024 results on Wednesday, January 29, 2025, at 07:00 CET. The company will make a stock exchange announcement, followed by the release of a press statement, quarterly report, and presentation on its investors' website (). Additionally, a presentation of the results will be held at 08:30 CET at Carnegie Investment Bank Norway, with the option to attend physically or via web-TV, allowing for live questions.

Borregaard ASA operates through three business segments: BioSolutions, BioMaterials, and Fine Chemicals. The company's strategic investment in debottlenecking and capacity increase at the Sarpsborg site, announced in October 2024, has had a positive impact on its financial performance and market position. The investment, totaling NOK 490 million, is the first out of two planned steps to increase capacity at the Sarpsborg site towards 2027, with an expected capacity increase of 5-10%. The first phase is expected to increase production output gradually from the second half of 2026.

The strategic investment has led to improved results in both BioSolutions and Fine Chemicals segments, while the result in BioMaterials was lower compared with the fourth quarter of 2023. Increased sales volume was the main reason for the improved result in BioSolutions, while significantly higher deliveries of bioethanol and a favorable product mix for fine chemical intermediates contributed to the stronger result in Fine Chemicals. For BioMaterials, significantly higher deliveries were more than offset by increased wood costs and other operating expenses.

The net currency effects were slightly positive, and profit before tax was NOK 326 million (NOK 318 million) in the fourth quarter of 2024. Earnings per share were NOK 2.51 (NOK 2.38). The strategic investment has also positioned Borregaard ASA to increase capacity for lignin-based biopolymers, speciality cellulose, and bioethanol, leading to higher raw material utilisation and a reduction of effluents to water.

Looking ahead, Borregaard ASA's outlook for each business segment is as follows:

1. BioSolutions:
* The diversified market strategy is expected to mitigate effects of a slowdown in certain end-markets.
* Sales volume in 2024 is forecast to be approximately 330,000 tonnes, depending on the global economic development.
* Sales volume in Q2 is expected to be in line with Q2-23, with the biovanillin market continuing to be impacted by the high supply of synthetic vanillin products.
2. BioMaterials:
* Sales volume in 2024 is forecast to be higher than the production output, with highly specialised grades expected to be higher vs 2023.
* In Q2, sales volume is expected to be lower vs Q1-24 but higher than the production output, with the average price in sales currency expected at the same level as Q1-24.
* The development in the construction market for cellulose ethers is the main uncertainty for 2024, with other applications expected to largely compensate.
3. Fine Chemicals:
* Sales volume for fine chemical intermediates is expected to increase vs 2023.
* Market conditions for advanced biofuels continue to be favorable in several countries, with sales prices and volume expected largely in line with 2023.
* Costs development and impact from investment will be closely monitored, with wood costs expected to increase by approximately 10% in H1-24 vs H2-23.

In conclusion, Borregaard ASA's strategic investment in debottlenecking and capacity increase at the Sarpsborg site has contributed to improved financial performance and a strengthened market position in the fourth quarter of 2024. The company's outlook for each business segment highlights the potential for growth and the importance of managing costs and market uncertainties. As Borregaard ASA reports its Q4 2024 results, investors and stakeholders will gain valuable insights into the company's strategic moves and market outlook, positioning the company for future growth and success.