Sappis net profits for the year have fallen 24% to 181m ($263m) as it suffers from "very difficult trading conditions in the coated fine paper and pulp markets worldwide".

Chairman and chief executive Eugene van As said the company curtailed 250,000 tonnes of paper production in the last quarter. Over the past six years it has removed 15 paper machines across its operations.

Sales for the year fell by over 11% to 2.8bn, with the group suffering a 14% drop in orders in North America and an 8-9% fall in Northern Europe, mainly due to inventory adjustments by customers and merchants.

Earnings before exceptional items for the fourth quarter fell by over 50% to 36m, while sales for the quarter dropped by nearly 20% to 686m.

But van As maintained that Sappis geographic spread meant it was in "a more robust position than some of our competitors".

There were mixed fortunes for Sappis UK mills. The company decided to close Transcript carbonless mill last month (PrintWeek, 12 October). Sappi Fine Paper chief executive Bill Sheffield said the groups Blackburn mill performed "very well", but that Nash mill did not have a good year. Sappi has established a turnaround plan for Nash for next year, he added.

Van As said Sappi hoped that order and production levels would return to the levels of the past after the first quarter next year.

"We expect a slow pulp price recovery and a steady improvement quarter-on-quarter through next year," he said.

Sappi will split the role of chairman and chief executive upon van As retirement towards the end of next year.

Van As said there would be no prince regent elected, and that Sappi would continue to assess inside and outside candidates for the job.

Story by Andy Scott