Vigourexplore our theme

Lizards are estimated to have been around for 240 million years. Little wonder, given that they make use of a variety of antipredator adaptations, including venom, camouflage, reflex bleeding and the ability to sacrifice and regrow their tails. What’s more, as with other reptiles, the skin of lizards is covered in overlapping scales made of keratin, providing protection from the environment and reducing water loss through evaporation. This characteristic enables them to thrive in some of the driest deserts on earth.

Vigour, strength and adaptability have ensured lizards’ ability to thrive over the course of time.

So, too, at Sappi, our commitment to growing our business and maintaining a healthy balance sheet, has sustained us for almost 90 years. We are vigorous in our commitment to deliver on our Thrive strategy, including by reducing exposure to graphic paper markets while investing for growth in our target markets and capitalising on our leadership position in pulp supply to the lyocell market.

Evolveexplore our theme

Very little in nature is static – everything is constantly changing and evolving. One miraculous example of this is the metamorphosis of the egg, the caterpillar (larva) and the chrysalis (pupa) into the adult butterfly. This process embodies fresh ideas, renewal and unexpected outcomes.

The caterpillar’s new form as a butterfly opens new horizons, but also new risks, particularly in the form of climate change. Butterflies are particularly sensitive to environmental changes like climatic shifts. That is because they are strictly adapted to certain environmental conditions and their development depends on certain larval food plants and specific microhabitat structures.

In Sappi’s case, climate change presents both risks and opportunities. We are addressing short- and long-term physical and transitional climate risks identified through processes outlined by the Task Force on Climate-related Financial Disclosures (TCFD) to build resilience. In addition, we are determined, as a socially responsible business, to play our part in ensuring a just transition in South Africa as the country faces the reality of reducing its dependence on coal.

We are also determined to accelerate our science-based decarbonisation trajectory which we see as an opportunity to future-proof our business. So too, are the opportunities presented by evolving customer needs and legislation – notably growing demand for sustainable packaging, based on low-carbon impact, together with demand for more sustainable textile fibres.

We cannot achieve our vision of a thriving world without an evolving response to climate change. By collaborating with a broad range of stakeholders we are working to achieve energy security and climate resilience and transform our vision into reality.

Postureexplore our theme

Beauty and confidence. Pride and upright posture. These attributes have meant that many cultures over the ages have associated peacocks with royalty and power.

This image is appropriate to Sappi because we too, can stand tall with pride when we consider our past achievements and drive to create not just enterprise value, but value for our people and for communities.

We have achieved enterprise value through our ability to be nimble and optimise profitability in ever-changing markets, reshaping our products and processes to create value and growth for our own business and our customers. We continue to offer our customers a broad range of solutions based on the power of renewable resources that enable them to achieve their sustainability goals and contribute to the low-carbon, circular economy. In doing so, we have continued to focus on treading more lightly on the Planet.

Creating value for our people and communities is underpinned by the structures and programmes we have established which facilitate open, authentic communication, by our ongoing investment in training, development and transformative community programmes, as well as by our collaborative partnerships focused on workable solutions to industry challenges.

Our commitment to delivering sustainable value to our stakeholders is based on our focus on living our values at all times: At Sappi we do business safely with integrity and courage, making smart decisions which we execute with speed.

Diving deeper into our,
performance and prospects

Fortifyexplore our theme

Hermit crabs are shapeshifters, moulting as they grow, continually shedding their exoskeletons and growing new ones. As their exoskeletons are fragile, they need shells for protection. Rather than produce their own shell, as they grow, they use shells abandoned by other marine creatures. This process is not a one-off, but continues throughout their lifespan, depending on water temperature, habitat and species.

Many species will enhance their chances of survival by encouraging anemones to attach to their shell, as the latter’s stinging tentacles may deter predators. The crabs even transfer the anemones from shell to shell when they move house.

We can draw parallels with Sappi, fortified as we are by our iterative Thrive strategy and by our agility in responding to changes in our operating context to emerge stronger and better positioned for growth. This process is underpinned by ongoing engagement with our stakeholders, whose input helps us shape our response to our environment as we collaborate to build a thriving world.

Balanceexplore our theme

Bubbles are things of fragility, wonder – and balance. That’s because the inward surface tension forces of the water film are exactly balanced by the outward-pushing pressure of the air inside.

Blowing more air in to make a bigger bubble means more air pressure inside and also means the bubble must get thinner in the process, because there is only so much water to go around. Should one keep blowing more air in, the film eventually won’t have enough reserve water to spread out into a bigger surface, and the ultimate catastrophe occurs: the bubble bursts.

The success of Sappi’s business is also based on balance. This includes continuous capital prioritisation as we look to reduce costs and grow the business while sustaining a healthy balance sheet. It involves reshaping our product portfolio to meet changing market needs and taking advantage of growth opportunities while being mindful of the risks. It means balancing the needs of people and communities with our responsibility to our shareholders.

As we move forward into the future, we know we can rely on the expertise and passion of our people and the ongoing cooperation of our stakeholders to maintain this balance and drive sustainable value creation.

Connectexplore our theme

Some mushrooms are bioluminescent, due to luciferins, the same compounds that make fireflies light up at night. This ability is used to attract insects which then spread the mushroom spores elsewhere in the forest, allowing the fungi to reproduce.

But that’s not where connection ends. Beneath every forest and wood lies a complex network of roots and fungi that connects trees and plants to one another. This network – sometimes called the Wood Wide Web – is almost 500 million years old and is vital for most plants on earth. Trees and plants obtain nutrients that the fungi acquire from the soil, such as nitrogen and phosphorus by means of enzymes that the trees do not possess. In return, the fungi receive carbon-rich sugar from the roots of the trees.

This symbiotic relationship enables all connected organisms to thrive.

Similarly, at Sappi our connection with our stakeholders shapes our work to build a thriving world. This connection enables us to meet the changing needs of every employee at Sappi and to offer our partners the renewable innovation they need to be successful. By understanding and connecting with community needs, we drive positive social impact, playing a role beyond making and selling.

Like mushrooms, our business is a living organism – growing, adapting and evolving in a continually shifting context. As we shape our response to this context, we prioritise value creation for all stakeholders.


Five-year review

US$ million 2023 2022 2021 2020 2019
Income statement          
Sales 5,809 7,296 5,265 4,609 5,746
Variable manufacturing and delivery costs 3,538 4,380 3,238 2,838 3,530
Fixed costs 1,788 1,832 1,777 1,673 1,771
Sundry expenses (income)1 51 46 47 41 43
Operating profit excluding special items 432 1,038 203 57 402
Special items – (gains) losses 52 268 57 95 19
Operating profit (loss) 380 770 146 (38) 383
Net finance costs 49 97 134 88 85
Profit (loss) before taxation 331 673 12 (126) 298
Taxation charge 72 137 (1) 9 87
Profit (loss) for the year 259 536 13 (135) 211
EBITDA excluding special items 731 1,339 532 378 687
Balance sheet          
Total assets 5,796 6,229 6,186 5,455 5,623
Non-current assets 3,742 3,430 4,255 3,891 3,789
Current assets 2,054 2,799 1,931 1,564 1,834
Current liabilities 1,316 1,524 1,309 1,123 1,214
Shareholders' equity 2,445 2,358 1,970 1,632 1,948
Net debt 1,085 1,163 1,946 1,957 1,501
   Gross interest-bearing debt 1,686 1,943 2,312 2,236 1,894
   Cash (601) (780) (366) (279) (393)
Capital employed 3,530 3,521 3,916 3,589 3,449
Cash flow          
   Cash generated from operations 659 1 267 472 323 673
   Decrease (increase) in working capital 178 (270) 39 65 (15)
   Finance costs paid (121) (102) (110) (108) (51)
   Finance income received 30 10 8 6 9
   Taxation paid (56) (23) (2) (26) (51)
   Dividends paid (85) (92)
Cash generated from operating activities 605 882 407 260 473
Net cash generated (utilised) 210 506 29 (257) 1
Cash effects of financing activities (416) (43) 33 138 56
Capital expenditure (gross) 382 368 374 351 471
   To maintain operations 170 196 176 126 148
   To expand operations 212 172 198 225 323
Exchange rates          
US$ per one Euro exchange rate – closing 1.057 0.980 1.172 1.163 1.094
US$ per one Euro exchange rate – average (financial year) 1.068 1.085 1.196 1.120 1.128
ZAR to one US$ exchange rate – closing 18.930 18.154 14.966 17.131 15.156
ZAR to one US$ exchange rate – average (financial year) 18.179 15.783 14.851 16.226 14.346
1 Sundry items include all income and costs not directly related to manufacturing operations such as debtor securitisation costs, commissions paid and received and results of equity accounted investments.
US$ million 2023 2022 2021 2020 2019
Number of ordinary shares (millions)1          
In issue at year-end 558.8 565.2 561.5 546.1 542.8
Basic weighted average number of shares in issue during the year 563.6 563.3 549.7 545.5 542.0
Per share information (US cents)          
Basic earnings (loss) 46 95 2 (25) 39
Diluted earnings (loss) 44 90 2 (25) 39
Headline earnings (loss) 50 130 5 (19) 42
Diluted headline earnings (loss) 47 122 5 (19) 42
EPS excluding special items (US cents) 52 138 15 (5) 44
Net asset value 438 417 351 299 359
Profitability ratios (%)          
Operating profit (loss) to sales 6.5 10.6 2.8 (0.8) 6.7
Operating profit excluding special items to sales 7.4 14.2 3.9 1.2 7.0
EBITDA excluding special items to sales 12.6 18.4 10.1 8.2 12.0
Operating profit excluding special items to capital employed (ROCE) 12.3 27.9 5.4 1.6 11.5
Net debt to EBITDA excluding special items 1.5 0.9 3.7 5.2 2.2
Interest cover 11.4 15.6 5.5 4.7 9.3
Return on average equity (ROE) 10.8 24.8 0.7 (7.5) 10.0
Debt ratios (%)          
Net debt to total capitalisation 30.7 33.0 49.7 54.5 43.5
Efficiency ratios          
Asset turnover (times) 1.0 1.2 0.9 0.8 1.0
Inventory turnover ratio 6.3 7.6 5.6 6.3 7.0
Liquidity ratios          
Current asset ratio 1.6 1.8 1.5 1.4 1.5
Trade accounts receivable days outstanding (including receivables securitised) 37 44 47 44 46
Cash interest cover (times) 11.2 12.9 4.5 3.7 7.6
Other non-financial information2          
Sales volumes 6,282 7,937 7,339 6,788 7,622
Number of full-time equivalent employees 12,329 12,495 12,492 12,805 12,821
Lost-time injury frequency rate (including contract employees) 0.24 0.30 0.38 0.35 0.54
   Energy intensity (GJ/adt) 26.20 22.10 22.30 23.70 22.10
   Renewable and clean energy to total energy (%) 57.90 55.00 54.90 54.80 53.50
   Specific process water extracted (m3/adt) 44.80 35.00 35.60 37.90 35.20
   Specific total landfill (kg/adt) 73,600 51,100 52,100 60,000 6,100
   Specific Scope 1 emissions (ton CO2 eq/adt) 0.70 0.61 0.68 0.71 0.66
   Absolute Scope 1 (ton CO2e) 3,474,491 4,078,569 4,268,701 4,078,268 4,420,758
   Specific Scope 2 emissions (ton CO2 eq/adt) 0.25 0.20 0.18 0.21 0.23
   Absolute Scope 2 (ton CO2e) 1,234,513 1,332,807 1,160,564 1,206,691 1,553,109

Refer to share statistics section for other market and share-related information.

1 Net of treasury shares (refer to note 19 to the group financial statements).
2 Certain energy, water, waste and emissions data for the comparative years have been restated using the latest reporting standards and measurement methodology.

Note: Definitions for various terms and ratios used above are included in the glossary section.