Suominen sheds PP, records solid growth

Suominen Nonwovens is to cease the production of polypropylene staple fibres at its plant in Nakkila in Western Finland, as part of a broader range of cost cutting measures.

In a statement, the company said it believed it was no longer strategically relevant to have its own in-house fibre manufacturing and has now negotiated a long term supply agreement for the raw material.

The fibre lines at Nakkila are to be closed by the end of 2012 at a write-down cost of about €3 million, with no cash flow effect.

Overall, Suominen Corporation has made tremendous gains during 2012 so far, following its integration of the Ahlstrom wipes business, largely as a result of increased volumes, higher sales  margins and the strict cost control measures which are now in place.

Sales for the nine months to the end of September were €345.9 million, compared to €128.5 million in the same period in 2011, with operating profit of €9.1 compared to a loss of €–2.5 million.

Operating profit in the most recent quarter was by far the strongest to date - at €6.2 million being more than double that of the first two 2012 quarters combined.