SCA creates value by
fulfilling the needs of
customers and consumers
in a spirit of innovation,
through continuous effi-
ciency enhancements
and with a clear desire to
contribute to
Personal Care
The business area comprises three product
segments: incontinence care, baby diapers
and feminine care. Production is conducted at
22 facilities in 19 countries. Products are sold
in so
The year at a glance
Net sales amounted to SEK 110,449m (105,913).
Profit for the year totalled SEK 5,598m (7,161).
Earnings per share amounted to SEK 7.94 (10.16).
Proposed dividend is SEK 3.50 (4.
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SCA’s aim is to continuously develop
www.sca.com, making it the SCA Annual Report 2008 SCA at a glance SCA creates value by fulfilling the needs of customers and consumers in a spirit of innovation, through continuous effi- ciency enhancements and with a clear desire to contribute to
Personal Care The business area comprises three product segments: incontinence care, baby diapers and feminine care. Production is conducted at 22 facilities in 19 countries. Products are sold in so
The year at a glance Net sales amounted to SEK 110,449m (105,913). Profit for the year totalled SEK 5,598m (7,161). Earnings per share amounted to SEK 7.94 (10.16). Proposed dividend is SEK 3.50 (4.
Welcome to the new www.sca.com! Expanded and improved – an entire world of important information about SCA… just a click away. SCA’s aim is to continuously develop www.sca.com, making it the
Introduction CEO’s message Strength and stability in difficult times In 2008, conditions changed dramatically for many compa- nies in the wake of the global finance crisis and the weaker econo
Within Forest Products, which has long reported world-class productivity figures, 84 different im- provement projects are currently under way. These projects will reduce tied-up capital. The in- tegr
Introduction The SCA share The SCA share in 2008 The 2008 closing price on the Nasdaq OMX Stockholm for SCA’s B shares was SEK 66.75 (114.50), corresponding to a market capitalisation of SEK 4
Data per share All earnings figures include non-recurring items. SEK per share unless otherwise indicated 2007 2006 2005
Introduction Value creation Value creation Value creating business idea through growth in hygiene SCA’s business idea is to develop, Growth in h
Introduction Value creation Financial targets 2010–2012 In light of the Group’s greater focus on capital efficiency, SCA has set the target for ROCE at a Group and business area level. As
Introduction Value creation Value creation SCA measures and evaluates profitability in operating activities as return on capital em- ployed (ROCE). The target for ROCE in the Group has been se
Board of Directors’ Report Page Operations and structure 10 Acquisitions, investments and divestments
Board of Directors’ Report Svenska Cellulosa Aktiebolaget SCA (publ), Corp. Reg. No. 556012-6293, registered office in Stockholm Operations and structure SCA is a global consumer goods and pap
Board of Directors’ Report SCA Group Acquisitions, investments and divestments SCA increased ownership in Chinese tissue company Vinda On 29 M
Board of Directors’ Report SCA Group Other Group information Environmental impact SCA conducts 14 operations for which a permit is required and six that are under obligation to submit reports
Sales and earnings Net sales increased by SEK 4,536m compared with the preceding year and amounted to SEK 110,449m (105,913). Higher prices, primarily for tissue and aquisitions increased net sales
3,200 1,600 0 2004 2005 2006 2007 2008 Strategic capital expenditures Depreciation according to plan Board of Directors’ Report SCA Group Operating cash flow Cash flow fro
Financial position Assets and capital employed The Group’s total assets rose 10% compared with the preceding year and amounted to SEK 158,968m (145,050). Non-current assets increased by SEK 8,552m,
Essentials for keeping dry Personal Care SCA offers incontinence care products, bab
Board of Directors’ Report Personal Care Personal Care Sales 2008: SEK 23,331m (22,101) +6% Operating profit 2008: SEK 2,912m (2,960) –2% Aver
Board of Directors’ Report Personal Care Market The global market for personal care products is driven by innovation, has annual sales of SEK 260bn and is growing at a faster rate than GDP. In
Operations in 2008 Key events • Decision to invest in expanded produc- tion capacity for incontinence care • Decision to invest in a new facility in the Moscow area • New technology
Essentials for keeping clean Tissue SCA offers consumer tissue including toilet paper,
Board of Directors’ Report Tissue Tissue Sales: SEK 38,380m (33,332) +15% Operating profit: SEK 2,375m (1,724) +38% Average no. of employees: 17,109 (
Board of Directors’ Report Tissue Market The global market for consumer tissue is valued at approximately SEK 300bn annually and it is growing at a faster rate than GDP. Europe represents one q
Operations in 2008 Key events • Price increases were implemented • Strengthened brand positions for consumer tissue • Integration of acquired European tissue operations proceeded a
Essentials for keeping safe Packaging SCA is a full-service supplier of packaging s
Board of Directors’ Report Packaging Packaging Sales: SEK 33,441m (33,728) –1% Operating profit: SEK 1,493m (2,651) –44% Average no of employees: 22,828 (23,56
Board of Directors’ Report Packaging Market The European corrugated-board market is valued at approximately SEK 200bn and generates an- nual growth of 2-3% over a business cycle. While growth i
Operations in 2008 Key events • Sale of conventional corrugated board business in the UK and Ireland to Spanish company SAICA for EUR 125m • Decision to close the containerboard mill i
Essentials for keeping up-to-date Forest Products Forest Products offers its cust
Board of Directors’ Report Forest Products Forest Products Sales: SEK 16,710m (18,744) –5%* Operating profit: SEK 2,207m (2,870) –23% Average n
Board of Directors’ Report Forest Products Market The European market for publication papers amounts to SEK 130bn. Magazine paper accounts for approximately 60%, while newsprint makes up the re
Operations in 2008 Key events • Intensified efficiency enhancement measures and cost-cutting measures to achieve higher profitability • New facility in Munksund for window components •
Board of Directors’ Report Raw materials, risk exposure Main raw materials, energy and transport 2008 Timber/chips 9.2 million cubic metres 44% from own forest, 56% purchased externally
Board of Directors’ Report Risk exposure Strategic risks Risk Action Business environment risks SCA is affected by political decisions and
Board of Directors’ Report Risk exposure Operational risks Risk Action Dependence on major customers A consolidation process is taking place in several of SCA’s sales channels toward fewer
New environmental target A new, ambitious carbon-dioxide target, sign- ing the UN’s Global Compact and a pioneering wind-power project are some of the highlights of SCA’s sustainability year 20
Financial statements, Group Income statement Group Net sales Cost of goods sold Gross profit Sales and administration expenses Items affecting comparability Share of profits of associates Opera
Financial statements Group Operating cash flow statement, supplementary disclosure Group Operations Net sales Operating expenses Operating surplus Adjustment
Financial statements Group Cash flow statement Group Operating activities Profit before tax Adjustment for non-cash items 1) Tax payments Cash flow from operating activities before change
Financial statements Group Correlation between cash flow statement and operating cash flow statement. Supplementary disclosures Cash flow from operating activiti
Financial statements Group Balance sheet Group Assets Non-current assets Goodwill Other intangible assets Buildings, land, machinery and equipment Biological assets Participations in asso
Financial statements Parent Company Financial statements, Parent Company Income statement SEKm
Financial statements Parent Company Balance sheet SEKm Note 31 Dec. 2007
Contents – Notes Note Page 1 Accounting principles 44 Group 2 Financia
Notes NOTe 1 ACCOuNTiNg pRiNCipleS The most important accounting principles applied in the preparation of this annual report are set out below. The same principles are usually applied in both the Par
PARENT COmPANy: The Parent Company reports all holdings in group companies at cost after deduction for any accumulated impairment losses. SubSidiarieS All companies in which the Group holds or contr
Financial statements Notes NOTe 1 CONTiNued statement, related tax effects are also recognised in the income statement. For items rec- ognised in equity, related tax effects are recognised in equi
caSh and caSh equivalentS Cash and cash equivalents are defined as cash and bank balances as well as short-term investmentswithamaturityoflessthanthreemonthsfromtheacquisitiondate.Restricted deposits
Financial statements Notes NOTe 1 CONTiNued PARENT COmPANy: The Parent Company applies the regulations in “Tryggandelagen” (Swedish act safe- guarding pension obligations). Accounting complies wit
liquidity and reFinancing riSkS Due to its capital-intensive operations and the chosen capital structure, SCA has to man- age a significant nominal debt. Liquidity and refinancing risk is the risk th
Financial statements Notes NOTe 2 CONTiNued Financing of capital employed by currency Currency EUR USD GBP MXN AUD DKK NZD PLN RUB CNY COP SKK MYR CAD CZK Other Total currency SEK Total 2
PRICE RISK Energy price hedges In 2008, SCA purchased approximately 7 TWh (7; 6) of electricity and approximately 10 TWh (10; 13) of natural gas. SCA hedges the price risk in en
Financial statements Notes NOTe 2 CONTiNued The table below shows the Group’s liquidity risk regarding financial liabilities (including interest payments), net settled derivatives that constitu
Financial statements Notes Financial inStrumentS by category Accounting principles for financial instruments have been applied to the balance sheet items below
financial statements Notes NOTe 3 Key AssessmeNTs ANd AssumpTiONs Preparation of annual accounts and application of different accounting standards are often based on management assessments or
acquirEd opErations The table below shows the fair value of acquired net assets, recognised goodwill and the effect on the Group’s cash flow statements of all acquisitions. preliminary acquisition b
financial statements Notes NOTe 5 OpeRATiNG iNcOme ANd expeNses distribution of operating income and expenses seKm Note
financial statements Notes NOTe 6 seGmeNT RepORTiNG primary segments – business segments pulp, timber
financial statements Notes NOTe 6 cONTiNued pulp, timber personal
financial statements Notes secONdARy seGmeNTs – GeOGRAphicAl AReAs The Groups’ operations are divided into three geographical areas: Europe, North America and
financial statements notes note 7 Continued Company’s appliCation of guidelines Fixed salary The fixed salary shall be in proportion to the individual’s position and the authority and responsibi
Remuneration and other benefits during the year variable seK fixed salary remu
financial statements Notes NOTe 8 dofepproRpeecrtiyA, pTliaOnNt aAndNedqiumippmAeinRtmanedNinTtangible assets seKm 2007 200
financial statements Notes defeRRed TAx expeNse (+), TAx iNcOme (–) seKm 2007 2006 Changes i
financial statements Notes NOTe 11 cONTiNued In addition to goodwill, there are trademarks in the Group that are judged to have an indef- inite useful life. The useful life is judged as indefin
NOTe 13 BiOlOgical asseTs SCA’s forest assets are divided up and reported as biological assets, that is, standing for- est and land assets. Standing forest is recognised at fair value and amounted a
Financial statements Notes NOTe 16 JOiNT veNTures Joint ventures, companies that SCA owns together with other parties and in which the parties by agreement exercise joint control, are consolid
Financial statements Notes corporate
Financial statements Notes NOTe 18 NON-curreNT FiNaNcial asseTs seKm 2007 2006 Available-for-sale financial assets
NOTe 21 OTHercurreNTreceivaBles seKm Bills receivable Receivables from associates Accrued financial income Derivatives Prepaid expenses and accrued income Other current receivables Total 2008
Financial statements Notes NOTe 24 equiTy Other seKm
Financial statements Notes equity, specification of reserves seKm value at 1 January Available-for-sale financial assets Result from valuation to fair value r
Financial statements Notes NOTe 26 prOvisiONs FOr peNsiONs SCA has both defined-contribution and defined-benefit pension plans. The most sub- stantial defined-benefit plans are based on period
Financial statements Notes unfunded plans Defined-benefit obligations 1,838 1,889 Unrecognised past service costs
Financial statements Notes NOTe 28 OTHer NON-curreNT liaBiliTies seKm 2007 2006 Derivatives
financial statements Notes – Parent company Notes – Parent Company NOTe 32 OTher exTerNal cOsTs In 2008, Other external costs include a reversal of an impairment loss on a receivable in
financial statements Notes – Parent company NOTe 35 fiNaNcialiTems seKm income from participations in group companies Dividends from subsidiaries income from participations in other companies
financial statements Notes – Parent company NOTe 40 sharesaNdParTiciPaTiONs subsidiaries Other companies seKm 2008 2007 2008 2007 Cost, 1 Jan. 56,657 56,657 11 70 I
financial statements Notes – Parent company NOTe 44 PrOvisiONs fOr PeNsiONs The Parent Company has both defined-contribution and defined-benefit pension plans. Below is a description of the Pa
financial statements Proposed distribution of earnings Annual accounts 2008 distribution of earnings, Parent company Distribution equity in the Parent Company: retained earnings
financial statements Audit report To the Annual Meeting of Shareholders in Svenska Cellulosa Aktiebolaget SCA (publ) Corporate identity number 556012-6293 We have audited the annual accounts
Corporate Governance Page Corporate Governance Report 81 Board of Directors and Auditors 86
Corporate governance Corporate Governance Report for Svenska Cellulosa Aktiebolaget SCA (publ) More detailed information at www.sca.com • Articles of Association • Swedish Code of Corporate G
Corporate governance Corporate governance at SCA Nomination Committee Annual General Meeting External Audit Remuneration Committee Board of Directors Audit Committee Internal Audit President
Corporate governance the specific task of examining how successfully the general and more detailed rules for control are followed within the company. The Committee meets the company’s audito
as advice and other assistance resulting from ob- servations made during such audits. The auditors have also received remuneration for separate advisory services. Most of the advice pertains to audit
Corporate governance Board of Directors and Auditors Elected by the Annual General Meeting SverkerMartin-Löf (1943) RolfBörjesson (1942)
Jan Johansson (1954) Lennart Persson (1947) Kenneth Eriksson (1944) President and CEO CFO and Executive V
SCA Data Multi-year summary SEKm INCOME STATEMENT Net sales Operating pro?t 1) Personal Care Tissue Hygiene Products Packaging Forest Products Fine paper and wholesale Other operations 2) Goo
Sca Data Comments to the multi-year summary Income statement Sales From 1998 until the end of 2000 net sales rose by approximately 5% per year and then increased in 2001 by slightly more t
Sca Data Production capacity (capacity is stated in thousands of tonnes unless otherwise indicated) tISSuE mill country capacity
Definitions and key ratios 1) caPItaLDEFInItIonS net operating assets The Group’s and the business areas’ net operating assets are calculated as an average of non-current assets according to the ba
Annual General Meeting and Nomination Committee The Annual General Meeting of Svenska Cellulosa Aktie- bolaget SCA will be held on Thursday, 2 April 2009 at 3 p.m. in Aula Magna, Stockholm Universit
SVENSKA CELLULOSA AKTIEBOLAGET SCA (PUBL) PO Box 7827, SE-103 97 STOCKHOLM, Sweden. Visiting address: Stureplan 3 Tel +46 8 788 51 00, fax +46 8 660 74 30 Corp. Reg. No.: 556012-6293 www.sca.com O
Zmags improved online publishingAnnual Report 2008 en
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