Schweitzer-Mauduit International reported sales of $1.44 billion in 2021, up 4 percent on an organic basis. GAAP operating profit was $83.3 million, down $45.5 million, and included $38.9 million of transaction and integration costs and incremental purchase accounting expenses from the Scapa acquisition that closed on April 15, 2021. Adjusted operating profit was $158.8 million, down $12.8 million.
The company’s engineered papers business recorded sales of $509.3 million for the year, down 4 percent, driven by a 2 percent volume decline and unfavorable price/mix of 4 percent, which were partially offset by a 3 percent currency benefit related to the euro.
The volume decline was primarily attributable to lower tobacco paper volumes, particularly low-ignition propensity (LIP) papers, as customers adjusted inventories lower after building significant safety stocks in mid-2020. The lower LIP volume was also a significant contributor to the negative mix effect. Rapid growth throughout the year in heat-not-burn sales was a positive offset within the tobacco business, while nontobacco paper volumes also increased.
In the fourth quarter of 2021, the engineered papers segment business reported sales of $134.8 million, up 3 percent, driven by a 5 percent volume increase, unfavorable price/mix of 1 percent and 1 percent of negative currency related to the euro. Volumes benefited from gains in tobacco papers, continued rapid growth in heat-not-burn products, and an increase in nontobacco papers.
“We enter 2022 confident that we will deliver strong growth in sales and profitability, said SWM CEO Jeff Kramer in a statement. “2021 top line performance met our growth expectations, but profits were impacted by sharp input cost increases and supply chain challenges, which we expect to moderate as this year progresses.
“Early signs show more positive fundamentals on several fronts. We have successfully increased prices across the business and see moderation on some key input costs while we continue to progress against other supply chain hurdles.”