The group produced 17% more paper at 4.16m tonnes. Sales of newsprint rose 28% to £422m, while turnover for magazine and fine papers remained static at £1.08bn and £767m respectively.
Chief executive Juha Niemelä said print advertising had suffered a 20% fall in the US and a 10% fall in Europe, but still expected the seasonal pick-up in printing paper to take place after the summer.
Sappi’s third quarter to June 2002 saw a 20% rise in net profit to £42m ($66m) on sales of £622m, a 0.7% rise.
In Europe sales volumes of fine paper have held up well despite a quiet summer, but in North America coated fine paper demand remains weak.
The South African group cut production of pulp and paper by 50,000 tonnes to 100,000 tonnes to match supply with demand.
The group’s fine paper division reported a 25.6% rise in operating income to £34.4m.
M-real’s turnover fell 6% in the first six months of 2002 to £2.1bn, with pre-tax profits down 12% to £141m.
The company said profitability had suffered due to lower selling prices, coupled with "an intense weakening in demand during June, and a fall in the exchange rate of the dollar".
Sales at M-real’s Map Merchant Group fell 7% to £242m in the second quarter and it made a £500,000 operating loss due to low delivery volumes.
Story by Andy Scott
