* Prepares split into two listed companies
* Hygiene ops Q1 adj EBIT 2.90 bln SEK vs consensus 2.85 bln
* Forest prods Q1 EBIT 498 mln SEK vs consensus 566 mln
(Adds detail, background, analyst comment, shares)
By Anna Ringstrom and Helena Soderpalm
STOCKHOLM, April 27 SCA will list its
hygiene operations in June, the Swedish company said on
Thursday, as it pursues a plan to split the business from forest
Europe's largest private forest owner has grown the hygiene
business, which produces tissues and nappies as well as
incontinence and feminine care products, to around 85 percent of
group turnover through restructuring and takeovers.
Shareholders this month approved plans to split SCA into two
companies by spinning off and listing the hygiene business,
which competes with Kimberly-Clark and Procter & Gamble
, under the name Essity.
"The intention is that the first day of separate trading in
the two companies will be in June 2017," it said on Thursday.
A Swedish newspaper reported this month an offer was made
for the business in March, sending SCA's shares to record highs.
The paper later said SCA had rejected the bid.
On Thursday, SCA shares were up 2.5 pct at 0847 GMT, taking
a year-to-date increase to 16 percent.
SCA said new targets for Essity were for annual organic
growth of above 3 percent and adjusted return on capital
employed of more than 15 percent.
UBS analyst David Hallden said the new growth target was
somewhat modest in comparison with SCA's former targets of 2-4
percent for the former Tissue division and 5-7 percent for the
former Personal Care business.
He said the plan to list Essity in June matched his
Essity, whose brands include Tena, Tork and Libero, had a
first-quarter operating profit before restructuring and other
one-off costs of 2.9 billion crowns ($331 million), up from a
year-ago 2.71 billion as higher volumes, better profitability
and cost cuts outweighed higher raw material and energy costs.
The mean forecast in a Reuters poll of analysts had been for
a 2.85 billion crown profit.
Essity generates the bulk of its turnover in Europe, but has
a plan to grow its share of sales in emerging markets. In the
quarter, organic sales grew 5 percent in emerging markets but
shrank 1 percent in mature markets.
The market leader on incontinence care products and no. 2 on
tissue said the global market for hygiene products was somewhat
challenging in the quarter.
At SCA's forestry products business, which will make up the
new SCA, operating profit shrank to 498 million crowns from 533
million, against an expected increase to 566 million.
($1 = 8.7680 Swedish crowns)
(Editing by Niklas Pollard and Alexander Smith)