Koskisen Group28.02.2017

Koskisen Group in 2016

Koskisen Group in 2016

Growth continued for Koskisen Group in 2016. The Group’s net sales totalled more than EUR 264 million, up nearly 7% from the previous year. Growth was seen especially in the two largest business units – Sawn Timber and Plywood. Operating profit in 2016 amounted to EUR 4.2 million, a clear decline from the previous year. Koskisen’s processed wood products were delivered to 69 countries around the world. Exports accounted for 54% of the Group’s net sales.

In 2016, operating profit fell short of the Group’s targets in all business units. The profitability of the operations was burdened by operational factors and by the inflexibility in the market price of softwood logs in relation to the change in the global market prices for sawn softwood.

At the end of the year, Koskisen Group had 1,087 employees, more than 120 of whom were employed outside of Finland. The number of employees grew during the year, especially in the Plywood Industry following an increase in production volumes. In the employee satisfaction survey, the Group received a score of 3.69 (on a scale of 1–5), which is about the same as the previous year’s score. 

Jukka Pahta, the Managing Director of Koskisen Group

Jukka Pahta, the Managing Director of Koskisen Group

At the end of the year, Koskisen Group had 1,087 employees, more than 120 of whom were employed outside of Finland. The number of employees grew during the year, especially in the Plywood Industry following an increase in production volumes. In the employee satisfaction survey, the Group received a score of 3.69 (on a scale of 1–5), which is about the same as the previous year’s score.

In October, Jukka Pahta was appointed Koskisen Group’s interim Managing Director, and he will continue as the Group’s ordinary Managing Director as of 1st of March, 2017.

The efforts to improve occupational safety continued in 2016, and resources were also reinforced. The Group’s incident density was 35 (1 day incidents/million working hours). The outcome is clearly higher than the target, and a lot of improvements will be needed in the coming years.

Customer satisfaction was measured using the NPS tool, and in 2016 the outcome was 47. Customers especially appreciate the high quality of Koskisen’s products and customer service.

Comments from the Koskisen customer satisfaction survey

During the year, investments totalling EUR 5.6 million were made, mostly consisting of replacement and upgrade investments in the plywood mill and the sawmill. The financial administration’s IT system project was wrapped up and the Group’s shared document management system was rolled out according to plan.

In 2016, Koskisen was granted the esteemed National Entrepreneurial Award by the Federation of Finnish Enterprises, as well as the Key Flag symbol by the Association for Finnish Work.

Overall, 2016 was a challenging year for Koskisen. Despite achieving net sales growth, the company’s profitability clearly fell short of the previous year’s figures and the set targets. Despite the underlying uncertainty factors, the recovery of the global economy is expected to continue, and this gives the company a good starting point for the future.

Customer satisfaction, continuous development of products and services and strengthening competitiveness through cost-effectiveness and correctly targeted investments will be the keys to Koskisen’s success going forward.

Performance by unit 2016

Sawn timber piles in Sawn Timber Industry

Koskisen’s Sawn Timber Industry had quite a good year in terms of operations. The Järvelä and Kissakoski sawmills broke production records and production indicators developed favourably. Over-supply in the markets, particularly in planed timber, weakened the profitability of processed sawn timber for the second year now. The market situation for sawn timber was twofold, as the price of pine declined nearly throughout the year, whereas the price of spruce was at an acceptable level, thanks to the Chinese market. A major reason to be pleased in 2016 was the clear improvement in inventory management: at the turn of the year, the total inventory was more than 20,000 m3 less than it was the previous year.

In the summer plywood industry celebrated “Plywood 50 years” with customers and personnel.

In the summer plywood industry celebrated “Plywood 50 years” with customers and personnel.

Koskisen’s Plywood production enjoyed more than 7% growth compared to the previous year, and dozens of new employees were hired at the mill. All in all, it was a challenging year, with major fluctuations in exchange rates in the first half of the year and difficulties in implementing major investments in the second half.

Along with the good market outlook, a more than 13% production ramp-up has been budgeted for the Plywood Industry for the current year.


Koskitukki is wood procurement company for Koskisen Group.

Koskitukki, which takes care of the Group’s wood procurement, procured nearly 2.2 million m³ of wood in 2016 (2015: 1.9 million m³). In 2016, procurement personnel responded well to new challenges, the girth of spruce logs was increased and the procurement volumes of full-length logs surpassed the budget. The high market price of softwood logs and growth in the birch log inventory related to the ramp-up in plywood production presented challenges for wood procurement. The IT system project in wood procurement, a major investment for Koskitukki, will continue in 2017. 

Koskisen chipboard mill the only one in Finland.

The sales volumes of Koskisen’s Chipboard Industry grew from the previous year, and the sales forecasts for 2017 also reflect an upward trend. In 2016, new melamine-coated panels and a matt panel were presented to customers; both new products were positively received in the market. The market outlook is looking brighter for Finland’s only chipboard mill. 


Peeling birch veneer in Hirvensalmi.

In Koskisen’s Birch Products Industry, the sales volume of birch sawn timber grew compared to the previous year, especially in the highest quality grades, although it was limited somewhat by the availability of high-quality timber raw material. Demand for birch veneer and thin veneer plywood was consistent, but the price competition kept profitability low.

Net sales for Koskisen Housing Industry rose slightly, and profitability was brought back on track. In line with the Group’s Strategy 2020, the focus on professional construction continued; more than 60% of net sales was generated by professional construction. In consumer trade, demand continued to be affected by Finland’s weak economic situation and low number of housing starts (in 2016: approx. 7,000 housing starts). On the consumer side, slight market growth is expected, and HERRALA’s “House of your life” and the “NERO” 2017 house models will meet this growth well. Petri Lento started as director of Koskisen’s Housing Industry at the end of 2016.