Jul 12, 2011. /Lesprom Network/. In the 2Q, Norwegian sawmiller and timber products manufacturer Moelven earned NOK 56 million ($10 million) from operations. That is NOK 85 million ($15.2 million) less than in the same period last year. After financial costs, profit for the quarter was NOK 28 million ($5 million), as the company said in a press release received by Lesprom Network. Operating revenues for the group in the 2Q were NOK 2,170 million ($388,965). In the first half, operating revenues were NOK 4,123 million ($739,034) and operating profit NOK 29 million ($5.2 million). The reason for the drop in operating profit from last year was largely the relatively high raw material prices for the timber consuming units compared with the price level in the finished goods markets. "Even though the prices of raw materials came down during the first half, the combination of these factors led to a weakening in operating profits for both the Timber and Wood divisions. Prices of industrial timber passed their peak in the 3Q 2010; during the 2Q 2011 they have been considerably lower than at the same time last year. The costs of raw materials have not gone down correspondingly," says Hans Rindal, CEO of Moelven Industrier ASA. Rindal explains that this has meant difficult conditions for the Timber division in particular. "The market for finished goods is still a little unstable. However, periods of low gross margins, because the raw material and finished goods markets are moving towards each other, are normal for this division. In the second quarter, we have after all moved back into a position where all three divisions have positive operating results and the group as a whole is earning money again, even though I would like to have seen more," says Rindal. All three divisions have increased sales, compared with the year before. For the Wood building product division, much of the cause is acquisitions. For the Building System division, it is a clear sign of improved market conditions, particularly in the professional building market in Sweden and Norway. Moelven expects that the group will see profits improve in the second half of the year, but that the annual profits will be at a lower level than last year.