Norske Skog produced and sold a greater quantity of paper in 2003 than in 2002, despite more difficult markets.
Substantially lower prices yielded operating earnings of NOK 1.4 billion in 2003, a decline of roughly NOK 500 million compared with 2002, according to a company statement.
Net earnings for 2003 came to NOK 402 million. The Improvement 2003 programme is yielding the expected results, and had an effect for the year of NOK 955 million before tax, the statement says.
Gross operating revenue for Norske Skog came to NOK 24.1 billion as against NOK 23.5 billion in 2002. Cash flow from operations totalled almost NOK 3 billion compared with NOK 3.7 billion in 2002.
The board has proposed an unchanged dividend of NOK 6 per share.
"Even in a year characterised by weak markets, we maintained strong operating margins by comparison with our competitors and a solid financial position," says Jan Oksum, Norske Skog's president and CEO.
"This primarily reflects the results of our improvement programme and better exchange rate trends compared with 2002.
"We are due to reach the target for the improvement programme by the end of 2004, with a lasting effect of NOK 2 billion compared with 2002.
"We're well equipped to meet new growth in all parts of the world, but are uncertain when markets in Europe and North America will start to pick up. Strict cost discipline remains necessary to improve the company's profitability."
Demand is expected to increase in Asia and South America, and the Australasian market should remain positive and stable.
Norske Skog's financial position is good. Despite depressed economic conditions, the company has repaid debt and improved the ratio between net interest-bearing debt and equity from 1.02 to 0.92 over the year.
At 31 December 2003, the company's holdings of cash and unutilised drawing rights totalled NOK 6.5 billion.
Norske Skog took up a long-term bond loan totalling USD 400 million in the USA last year, making it one of the very few Norwegian companies to obtain a 30-year loan. This has further improved its debt repayment schedule.
With 119.4 million traded in 2003, the Norske Skog share ranks as one of the most liquid on the Oslo Stock Exchange.
Health and safety have a high priority at Norske Skog, and this commitment is yielding results. The company set a new record in 2003 for the lost-time injury frequency per million working hours, which averaged just 3.6.
More details of the results for 2003 and for the fourth quarter of the year can be found on the company's web site at www.norske-skog.com.