WSE:ATC

Stock Analysis Report

Executive Summary

Arctic Paper S.A., together with its subsidiaries, produces and sells paper for printing houses, paper distributors, book and magazine publishing houses, and the advertising agencies in Germany, France, the United Kingdom, Scandinavia, Poland, other Western Europe, Central and Eastern Europe, and internationally.

Rewards

Trading at 80.5% below its fair value

Earnings are forecast to grow 21.9% per year

Earnings grew by 25% over the past year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Highly volatile share price over past 3 months

Does not have a meaningful market cap (PLN322M)



Snowflake Analysis

Very undervalued with excellent balance sheet.

Share Price & News

How has Arctic Paper's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ATC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

2.9%

ATC

0.3%

PL Forestry

0.7%

PL Market


1 Year Return

30.3%

ATC

-12.0%

PL Forestry

-7.1%

PL Market

Return vs Industry: ATC exceeded the Polish Forestry industry which returned -12.6% over the past year.

Return vs Market: ATC exceeded the Polish Market which returned -7.7% over the past year.


Shareholder returns

ATCIndustryMarket
7 Day2.9%0.3%0.7%
30 Day13.4%2.0%-1.7%
90 Day27.0%1.5%-0.2%
1 Year30.3%30.3%-12.0%-12.0%-4.3%-7.1%
3 Year-10.9%-14.7%-34.3%-36.7%-4.3%-11.1%
5 Year13.0%8.1%-5.5%-12.7%2.7%-10.3%

Price Volatility Vs. Market

How volatile is Arctic Paper's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Arctic Paper undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ATC (PLN4.65) is trading below our estimate of fair value (PLN23.88)

Significantly Below Fair Value: ATC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ATC is good value based on its PE Ratio (8.3x) compared to the Forestry industry average (11x).

PE vs Market: ATC is good value based on its PE Ratio (8.3x) compared to the Polish market (12.1x).


Price to Earnings Growth Ratio

PEG Ratio: ATC is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: ATC is good value based on its PB Ratio (0.5x) compared to the PL Forestry industry average (0.7x).


Next Steps

Future Growth

How is Arctic Paper forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

21.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ATC's forecast earnings growth (21.9% per year) is above the savings rate (2%).

Earnings vs Market: ATC's earnings (21.9% per year) are forecast to grow faster than the Polish market (11.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: ATC's revenue is expected to decline over the next 3 years (-0.4% per year).

High Growth Revenue: ATC's revenue is forecast to decline over the next 3 years (-0.4% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ATC's Return on Equity is forecast to be low in 3 years time (11.9%).


Next Steps

Past Performance

How has Arctic Paper performed over the past 5 years?

-12.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ATC has high quality earnings.

Growing Profit Margin: ATC's current net profit margins (1.2%) are higher than last year (1%).


Past Earnings Growth Analysis

Earnings Trend: ATC's earnings have declined by -12.7% per year over the past 5 years.

Accelerating Growth: ATC's earnings growth over the past year (25%) exceeds its 5-year average (-12.7% per year).

Earnings vs Industry: ATC earnings growth over the past year (25%) exceeded the Forestry industry -40.2%.


Return on Equity

High ROE: ATC's Return on Equity (9.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Arctic Paper's financial position?


Financial Position Analysis

Short Term Liabilities: ATC's short term assets (PLN1.1B) exceed its short term liabilities (PLN707.6M).

Long Term Liabilities: ATC's short term assets (PLN1.1B) exceed its long term liabilities (PLN535.8M).


Debt to Equity History and Analysis

Debt Level: ATC's debt to equity ratio (45.6%) is considered high.

Reducing Debt: ATC's debt to equity ratio has reduced from 50.5% to 45.6% over the past 5 years.

Debt Coverage: ATC's debt is well covered by operating cash flow (73.4%).

Interest Coverage: ATC's interest payments on its debt are well covered by EBIT (7.4x coverage).


Balance Sheet

Inventory Level: ATC has a high level of physical assets or inventory.

Debt Coverage by Assets: ATC's debt is covered by short term assets (assets are 2.6x debt).


Next Steps

Dividend

What is Arctic Paper's current dividend yield, its reliability and sustainability?

4.30%

Current Dividend Yield


Dividend Yield vs Market

company4.3%marketbottom25%2.3%markettop25%6.6%industryaverage4.2%forecastin3Years10.8%

Current dividend yield vs market & industry

Notable Dividend: ATC's dividend (4.3%) is higher than the bottom 25% of dividend payers in the Polish market (2.33%).

High Dividend: ATC's dividend (4.3%) is low compared to the top 25% of dividend payers in the Polish market (6.74%).


Stability and Growth of Payments

Stable Dividend: ATC's dividend payments have been volatile in the past 10 years.

Growing Dividend: ATC's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (35.6%), ATC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ATC's dividends in 3 years are forecast to be well covered by earnings (44.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.4yrs

Average board tenure


CEO

Michal Jarczynski 0

1yrs

Tenure

zł1,392,822

Compensation

Mr. Michal Piotr Jarczynski has been the President of the Management Board, Member of of the Management Board and Chief Executive Officer at Arctic Paper S.A., since February 1, 2019. Mr. Jarczynski served ...


CEO Compensation Analysis

Compensation vs Market: Michal's total compensation ($USD0.00) is below average for companies of similar size in the Polish market ($USD157.18K).

Compensation vs Earnings: Insufficient data to compare Michal's compensation with company performance.


Board Members

NamePositionTenureCompensationOwnership
Mariusz Grendowicz
Independent Member of Supervisory Board7.7yrszł180.00kno data
Per Lundeen
Chairman of Supervisory Board3.4yrszł324.00k0.050% PLN161.6k
Roger Mattsson
Deputy Chairman of Supervisory3.4yrszł207.00kno data
Thomas Onstad
Member of Supervisory Board11.3yrszł150.00k8.98% PLN28.9m
Dorota Raben
Member of Supervisory Board0.8yrsno datano data

3.4yrs

Average Tenure

56yo

Average Age

Experienced Board: ATC's board of directors are considered experienced (3.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Arctic Paper S.A.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Arctic Paper S.A.
  • Ticker: ATC
  • Exchange: WSE
  • Founded: 1983
  • Industry: Paper Products
  • Sector: Materials
  • Market Cap: zł322.188m
  • Shares outstanding: 69.29m
  • Website: https://www.arcticpaper.com

Number of Employees


Location

  • Arctic Paper S.A.
  • Ul. Jana Henryka Dabrowskiego 334A
  • Poznan
  • 60406
  • Poland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ATCWSE (Warsaw Stock Exchange)YesOrdinary SharesPLPLNOct 2009
0OIULSE (London Stock Exchange)YesOrdinary SharesGBPLNOct 2009
ARPOM (OMX Nordic Exchange Stockholm)YesOrdinary SharesSESEKOct 2009

Biography

Arctic Paper S.A., together with its subsidiaries, produces and sells paper for printing houses, paper distributors, book and magazine publishing houses, and the advertising agencies in Germany, France, the United Kingdom, Scandinavia, Poland, other Western Europe, Central and Eastern Europe, and internationally. The company operates through Uncoated Paper, Coated Papers, Pulp, and Other segments. It offers uncoated wood-free papers, such as white offset, woodfree bulky book, and graphic papers; coated wood-free papers; uncoated wood-containing papers, such as wood containing bulky book paper; fully bleached and unbleached sulphate pulp; and chemi-thermo mechanical pulp and groundwood. The company markets its uncoated paper products under the Amber and Munken brands; and coated paper products under the G-Print and Arctic brands. In addition, it generates, transmits, and distributes electricity; produces and distributes heat; distributes paper; rents properties, and machines and equipment; and produces hydro energy and food packaging products, as well as provides trading, logistics, and procurement bureau services. The company was founded in 1983 and is headquartered in Poznan, Poland. Arctic Paper S.A. is a subsidiary of Nemus Holding AB. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 21:39
End of Day Share Price2020/02/17 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.