Metsä Board Corporation Stock exchange release Inside information 16 January 2025 at 13:30 EET
Due to the prolonged weak profitability, Metsä Board, part of Metsä Group, plans to close its Tako mill as well as to improve the efficiency of its Kyro mill, and launches change negotiations at both mills and related operations. The negotiations will involve a total of approximately 360 employees and may lead to a reduction of up to 215 employees. The negotiations are expected to last at least six weeks. If the plan is implemented, production at Tako mill would end in 2025. The aim of the change negotiations at the Kyro mill is to improve the profitability of the mill and safeguard its operational conditions. Any decisions on personnel reductions and mill closure will only be taken after the change negotiations have been concluded.
In recent years, the production of folding boxboard at Tako and Kyro mills has remained well below capacity due to the market situation, and the mills have had to implement several temporary layoffs. Due to weak market situation and rapidly rising costs, both mills have been loss-making in 2023 and 2024. The cost competitiveness of Tako board mill is particularly weakened by its high energy costs and the small size of its production lines. The development of the mill is limited by its exceptional location in the centre of the city of Tampere. The possible closure of Tako board mill would have no impact on customer deliveries, as Metsä Board's overall capacity for folding boxboard production is sufficient to meet current demand.
Metsä Board estimates that the planned measures would improve the company's comparable EBITDA by approximately EUR 30 million per year. If implemented, the measures would lead to a write-down of assets of approximately EUR 30 million. The one-off costs related to possible redundancies and restructuring would be specified later. Items related to write-down and other costs would be recognised in the first quarter 2025 operating result as an item affecting comparability.
Tako board mill has two folding boxboard machines with annual production capacities of 70,000 and 140,000 tonnes. This represents approximately 13% of the company's current annual production capacity of approximately 1.6 million tonnes of folding boxboard.
CEO Mika Joukio: "The planned measures published today, if implemented, would be extremely tough for us. Our employees at our Pirkanmaa mills are highly skilled and have shown a lot of flexibility in the difficult market situation of recent years. However, we need to consider alternatives to improve our competitiveness and profitability. We currently have a number of ongoing and planned investments to improve the competitiveness of our mills and products, which will require capital and a strong financial position in the coming years."
Press conference and additional information
Metsä Board will hold a press conference in Finnish for the media at Scandic Tampere City (Hämeenkatu 1) on Thursday 16 January 2025 at 16.00. The event will be attended by Metsä Board's CEO Mika Joukio; VP, Tako Board Mill Timo Ahonen and VP, Kyro Board Mill Petri Huiko. The event can also be followed as a Teams-meeting, where questions can be asked via the chat function. Click here to register for the event and the Teams-meeting.
Investor inquiries will be answered by CFO Henri Sederholm and VP, Investor relations Katri Sundström. Metsä Board is currently in a silent period, which may limit the disclosure of some additional information. The silent period will last until the publication of Financial statements bulletin 2024, on 6 February 2025.
METSÄ BOARD CORPORATION
For further information, please contact:
Mika Joukio, CEO, tel. +358 10 465 4300
Henri Sederholm, CFO, tel. +358 10 465 4913
Katri Sundström, VP, Investor relations, tel. +358 10 462 0101
Metsä Board
metsagroup.com/metsaboard
Metsä Board is a producer of lightweight and high-quality folding boxboards, food service boards and white kraftliners. The pure fresh fibres we use in our products are a safe, renewable and recyclable resource, that can be traced back to northern forests. We aim to have completely fossil free mills and raw materials by the end of 2030. We promote a culture of diversity, equality and inclusion.
Metsä Board is listed on the Nasdaq Helsinki. In 2023 our sales totalled EUR 1.9 billion, and we have around 2,300 employees. Metsä Board is part of Metsä Group, whose parent company Metsäliitto Cooperative is owned by more than 90,000 Finnish forest owners. The sales of the whole Metsä Group were EUR 6.1 billion.
