Unaudited financial results of Nordic Fibreboard AS for the third quarter of 2022

MANAGEMENT REPORT

Consolidated net sales for Q3 2022 were € 2.79 million (Q3 2021: € 2.33 million). The main business area is the production and wholesale of fibreboard, which recorded sales in Q3 2022 of € 2.78 million, an increase of 23% compared to Q3 2021. The remaining business area is real estate management of the property owned in Suur-Jõe street in Pärnu, who recorded sales of € 9 thousand in Q3 2022 (Q3 2021: 65 thousand).

The reason for the increase in sales revenue in Q3 2022 for Nordic Fibreboard Ltd was the ongoing strong demand for building materials in the construction sector, as reflected in both volume growth and price increases. That being said, towards the end of Q3 2022 we started to see a reduction in customers orders, reflecting the softening of business confidence as a result of negative macro factors, such as increasing interest rates, energy crisis, and higher food prices. As a result of these sentiments, Nordic Fibreboard is announcing the layoff of 8 production workers and is therefore reducing production capacity to keep up with the decline in demand.

The consolidated EBITDA of Nordic Fibreboard for Q3 2022 was € 193 thousand, the EBITDA margin was 7% (Q3 2022: EBITDA was € 356 thousand and the EBITDA margin was 15%).  Compared to the Q3 2021 the Group`s gross margin decreased from 32% to 19% in the Q3 2022. The main reason for this reduction in profitability was due to the sharp increase in raw material costs,…