During the second quarter of 2019, Arctic Paper Group reached a turnover of PLN 762.5 million (compared to PLN 784.1 million in Q2 2018) with an EBITDA of PLN 90.5 million (vs. PLN 65.9 million). On the consolidated level, the result continues to be strong. The combination of pulp and paper stabilizes our results, as the fluctuations on the two segments offset each other.
The paper segment generated a turnover of PLN 537.6 million (vs. PLN 558.8 million in Q2 2018) with an EBITDA of PLN 35.4 million (vs. PLN 19.7 million), of which PLN 18 million is non-recurring revenue attributable to the sale of the land at the Mochenwangen mill. Production during Q2 was 147,000 tonnes (vs. 160,000) and during the first half of 2019 production was 296,000 tonnes (vs. 326,000 in H1 2018).
Our paper business is still operating in a challenging and highly competitive environment, even though we have seen a tendency towards more favourable market conditions during the second quarter. Pulp prices have decreased by 10 percent on average, while our revenue per tonne, due to price adjustments and a better product mix, has increased by 4.6 percent compared to Q2 2018. Our biggest challenge now is to compensate for the lower demand for graphical paper by introducing new products in other segments and maximizing the output from our mills. Our growing business in kraft paper has resulted in 3,000 tonnes of new volume during the first half of 2019. The investment in expanded capacity at Arctic Paper Kostrzyn was finalized during Q2 and the modernized PM1 is now in production. The investment of EUR 10m opens up a wider range of products and qualities to be produced, both graphical and kraft paper, thus making the mill much more flexible. The share of premium and speciality products represented 28 percent of total sales during the first half of 2019 (vs 26 percent in H1 2018).
The profit improvement program, with the ambition to generate annual cost savings of approximately PLN 40 million from 2020, is on-track and running as planned. During the summer our new shared services centre for Group supporting functions opened in Kostrzyn.
For Rottneros AB, of which the Arctic Paper Group owns 51 percent, net turnover increased by 1 percent to SEK 582 million (vs SEK 576 million in Q2 2018) and EBITDA by 11 percent to SEK 131 million (vs SEK 118 million in Q2 2018). The full report is available at http://www.rottneros.com/investors/financial-reports/
We are persistent in defending and restoring our margins. We are therefore working hard to lower our costs, increase productivity and accelerate the reshaping of our product portfolio. The necessary changes will take time to implement, but during the second quarter we started to see some early effects of our efforts.