Moelven started the year on a positive note, and the coronavirus pandemic has not yet significantly impacted the group’s operations. However, the pandemic makes it almost impossible to predict the future.
Moelven saw revenues of NOK 2,735.5 million in the first quarter, which is a marginal increase from the same period last year (2,695.8 million). The operating result in the first quarter was NOK 69.6 million compared to NOK 140.9 million last year.
Profit before tax was NOK -30.5 million compared to NOK 100.1 million in the first quarter of 2019. The main causes of the decline are reduced margins in the international sawn timber operations, and a reduced activity level in system interiors and building modules in Sweden. In addition there was a strong negative development in market values on unrealised financial instruments as a result of heavy turbulence in the financial markets.
“We are reporting an operating result which under the assumptions is very good. This is due to good activity in the building products trade. We are seeing positive developments in the market for international timber compared to the end of last year, and a favourable currency situation for our exporting units. There have also been improvements in the order intake for our units in module building and glulam,” says CEO Morten Kristiansen.
The coronavirus outbreak
The coronavirus pandemic has obviously affected the group, although the direct consequences of the virus outbreak have not greatly affected us so far.
“We have had higher sickness absence than usual as a result of the coronavirus situation, but have largely managed to maintain both production and deliveries according to schedule. We do however note that changes come hard and fast, particularly on the international market. This has led to a need for local adjustments, and it’s all about staying alert in order to handle an ongoing uncertain situation. Among other things, we have adjusted investment activities for a period until we have a clearer picture of the impact of the virus outbreak,” Kristiansen says.
Never before has the outlook been more difficult to predict. The only thing that is certain is that Moelven will feel the impact of the pandemic.
“We are particularly concerned for the development of larger projects in the building industry in both Norway and Sweden. Moelven plays a part in the entire value chain in the wood industry, and if activity on the project side dries up, our industry will be severely affected. We have already seen clear signs of this in our units working with office fittings. We hope the authorities initiate more building projects to keep the economy afloat for the rest of the year and into next year,” Kristiansen says.