Metsä Board Corporation Stock exchange release Financial Statement Release 6 February 2025 at 12:00 noon EET
January-December 2024 (compared to 1-12/2023)
Sales were EUR 1,938.6 million (1,941.9).
The comparable operating result was EUR 69.0 million (122.2), or 3.6% of sales (6.3). Operating result was EUR 62.3 million (120.8).
Comparable earnings per share were EUR 0.09 (0.27), and earnings per share were EUR 0.07 (0.27).
Comparable return on capital employed was 3.2 % (5.1).
Net cash flow from operations was EUR 37.8 million (342.8).
October-December 2024 (compared to 10-12/2023)
Sales were EUR 446.0 million (422.6).
The comparable operating result was EUR -3.6 million (0.7), or -0.8% (0.2) of sales. Operating result was EUR -1.7 million (-0.2).
Comparable earnings per share were EUR -0.03 (0.01), and earnings per share were EUR -0.02 (0.01).
Comparable return on capital employed was -0.3% (0.4).
Net cash flow from operations was EUR 49.7 million (124.3).
Events in October-December 2024
The delivery volumes of Metsä Board's fresh fibre paperboards, especially folding boxboards, decreased from the previous quarter. This was partly explained by seasonality.
In Europe, the market situation for softwood pulp remained stable. In China, purchase activity returned to a normal level. The average prices of market pulp (PIX) decreased.
Metsä Board's comparable operating result for October-December 2024 includes EUR 7.5 million in insurance compensation received in relation to the gas explosion at Metsä Fibre's bioproduct mill. The compensation includes the impact of Metsä Fibre's share of the result.
The repair shutdown at Metsä Fibre's Kemi bioproduct mill in November-December is estimated to have had a EUR 9 million negative impact on Metsä Board's comparable operating result.
Metsä Board conducted change negotiations at its mills in Finland on possible layoffs during 2025. If required, layoffs may be implemented in several installments for a maximum of 90 days.
Board of Directors' proposal for dividend
The Board of Directors proposes to the Annual General Meeting to be held on 20 March 2025 that a dividend of EUR 0.07 per share be distributed for the 2024 financial period. The proposed dividend corresponds to 98% of the earnings per share for 2024.
Events after the review period
Metsä Board announced on 16 January 2025 that it plans to close the Tako mill and to improve the efficiency of the Kyro mill due to prolonged weak profitability. The company initiated change negotiations at both mills and in related other operations. No decisions concerning personnel reductions and possible mill closure will be made until the negotiations have been concluded.
On 6 February 2025, Metsä Board announced that it will start a pre-engineering in cooperation with Metsä Tissue to investigate potential change of product produced on Husum BM2. The pre-engineering is expected to take 12 months and it would enable new capacity of approximately 80,000 tonnes of foodservice packaging papers and siliconized greaseproof papers. Production of the white kraftliner will continue at full capacity at least until the possible investment shutdown of BM2. The start-up of the rebuilt line would be earliest in Q4/2027.
Near-term outlook
The overall demand for consumer products and fresh fibre paperboards is influenced by the development of consumers' purchasing power and general purchasing behaviour. Paperboard capacity, which is growing faster than demand, may cause imbalances, especially in the European paperboard market.
In January-March 2025, Metsä Board's paperboard delivery volumes are expected to increase from the previous quarter (10-12/2024: 342,000 tonnes). Sales prices in local currencies are expected to remain stable.
Total costs, excluding pulp costs, are expected to remain at the previous quarter's level.
There are no planned annual maintenance shutdowns at the mills in January-March.
Demand for softwood market pulp is expected to remain stable in Europe and China. Pulp capacity closures and restrictions related to the availability of wood raw material in North America, announced last year, will continue to reduce the supply of softwood market pulp. Demand for sawn timber is expected to remain at the current level.
Associated company Metsä Fibre's result share is expected to improve from the previous quarter.
In January-March 2025, exchange rate fluctuations, including the impact of hedges, will have a flat impact on the result compared to October-December 2024 and slightly positive impact compared to January-March 2024.
Result guidance for January-March 2025
Metsä Board's comparable operating result in January-March 2025 is expected to improve from October-December 2024.
Metsä Board's CEO Mika Joukio:
"In October-December, demand for paperboards was lower than expected, and our delivery volumes decreased from the previous quarter. We adjusted production to match the low demand at several of our mills. Our profitability was also burdened by the repair shut-down at Metsä Fibre's Kemi bioproduct mill, which lasted for about a month. Our sales in October-December amounted to EUR 446 million, and our comparable operating result was EUR -3.6 million.
We had a positive start to 2024, with paperboard demand picking up clearly from the previous year's record low level. However, activity faded towards the end of the year, and our paperboard deliveries, amounting to approximately 1.5 million tonnes, remained below our capacity level. Demand is still constrained by cautious purchasing behaviour and consumption focusing more on services than products. In addition, market balance has been influenced by the strong growth in Asian paperboard capacity and increasing paperboard imports especially to Turkey, the Middle East and South America.
In 2024, return on capital employed was around 3.2 per cent, compared to our target of at least 12 per cent. In addition to a challenging market situation, our profitability was negatively affected by high cost level, which we must continue to take into account also in the future.
Moreover, various unexpected events beyond our control occurred over the year. The political strikes in Finland, the gas explosion at Metsä Fibre's Kemi bioproduct mill in the spring, as well as the repair shutdown at the end of the year, resulted in production losses and had a negative impact on our profitability. Thanks to our organisation's expertise and resilience, we maintained production with special arrangements, thus minimising any harm to our customers.
Roughly a year ago, two significant investments increasing our annual paperboard capacity were completed in Husum and Kemi. In 2024, we decided not to invest in a new folding boxboard mill in Kaskinen. The reason was the high cost level, which clearly exceeded our original estimate and meant that the investment did not meet our financial targets.
Our profitability is at an unsatisfactory level, and the measures adopted so far to improve it have been insufficient. In January, we announced our plans to shut down the Tako mill and improve operational efficiency at the Kyro mill. Due to the challenging market situation and quickly rising cost level, both mills have operated unprofitably in recent years. The possible closure of the Tako mill would not affect customer deliveries, as our overall paperboard production capacity would be sufficient meet current demand.
We have initiated change negotiations at both mills. No decisions concerning personnel reductions and the Tako mill's closure will be made until the negotiations have been concluded. Naturally, these measures, if implemented, would be very difficult for us. However, we must consider different alternatives for improving our competitiveness and profitability.
We are determined to continue our sustainability work. Our aim of fossil-free production and products by the end of 2030, which will also help our value chain operators achieve their sustainability targets. We have proven evidence of the low carbon footprint of our paperboards, which is an increasingly important issue for our customers.
We have a solid financial position, although we have invested significantly in recent years. We will continue to develop our business as planned. Thanks to our lightweight, high-quality fresh fibre paperboard and our wide range of services, we are well positioned to respond to increasing regulation and competition."
| Key figures | |||||
| 2024 | 2023 | 2024 | 2023 | ||
| Q4 | Q4 | Q1-Q4 | Q1-Q4 | ||
| Sales, EUR million | 446.0 | 422.6 | 1,938.6 | 1,941.9 | |
| EBITDA, EUR million | 26.5 | 25.1 | 175.9 | 214.6 | |
| comparable, EUR million | 24.6 | 26.0 | 175.0 | 216.0 | |
| EBITDA, % of sales | 5.9 | 5.9 | 9.1 | 11.1 | |
| comparable, % of sales | 5.5 | 6.2 | 9.0 | 11.1 | |
| Operating result, EUR million | -1.7 | -0.2 | 62.3 | 120.8 | |
| comparable, EUR million | -3.6 | 0.7 | 69.0 | 122.2 | |
| Operating result, % of sales | -0.4 | 0.0 | 3.2 | 6.2 | |
| comparable, % of sales | -0.8 | 0.2 | 3.6 | 6.3 | |
| Result before taxes, EUR million | -5.6 | 1.4 | 51.4 | 120.9 | |
| comparable, EUR million | -7.5 | 2.3 | 58.2 | 122.6 | |
| Result for the period, EUR million | -2.4 | 0.9 | 39.4 | 101.6 | |
| comparable, EUR million | -4.4 | 1.8 | 44.6 | 103.8 | |
| Earnings per share, EUR | -0.02 | 0.01 | 0.07 | 0.27 | |
| comparable, EUR | -0.03 | 0.01 | 0.09 | 0.27 | |
| Return on equity, % | -0.5 | 0.2 | 2.0 | 4.7 | |
| comparable, % | -0.9 | 0.3 | 2.3 | 4.8 | |
| Return on capital employed, % | 0.0 | 0.3 | 2.9 | 5.0 | |
| comparable, % | -0.3 | 0.4 | 3.2 | 5.1 | |
| Equity ratio, % | 64 | 67 | 64 | 67 | |
| Net gearing1), % | 18 | 7 | 18 | 7 | |
| Interest-bearing net liabilities/comparable EBITDA, 12 months rolling | 2.0 | 0.7 | 2.0 | 0.7 | |
| Shareholders' equity per share, EUR | 4.91 | 5.35 | 4.91 | 5.35 | |
| Interest-bearing net liabilities, EUR million | 344.9 | 144.0 | 344.9 | 144.0 | |
| Total investment, EUR million | 55.0 | 71.9 | 175.4 | 228.7 | |
| Net cash flow from operations, EUR million | 49.7 | 124.3 | 37.8 | 342.8 | |
| Personnel | 2,290 | 2,240 | 2,290 | 2,240 | |
METSÄ BOARD CORPORATION
Further information:
Henri Sederholm, CFO, tel. +358 10 465 4913
Katri Sundström, VP, Investor Relations, tel. +358 10 462 0101
Webcast and conference call
A webcast and a conference call for analysts and investors in English will be held on 6 February at 3:00 p.m. EET.
CEO Mika Joukio and CFO Henri Sederholm will present the results. The webcast and conference call can be followed online on the company's website at https://metsaboard.events.inderes.com/q4-2024.
Participation in the conference call requires registration through the following link: https://events.inderes.com/metsaboard/q4-2024/dial-in. After the registration, the participant will be provided with a phone number, a User ID and a Conference ID to access the conference. By participating in the conference call, the participant agrees that personal information such as name and company name can be collected.
The webcast presentation and conference call will be recorded and archived on the company's website, where it can be viewed afterwards at: https://www.metsagroup.com/metsaboard/investors/reports-and-presentations/webcasts-and-conference-calls/.
Metsä Board
metsagroup.com/metsaboard
Metsä Board is a producer of lightweight and high-quality folding boxboards, food service boards and white kraftliners. The fresh wood fibres we use in our products are a renewable and recyclable resource, that can be traced back to Northern European forests. We aim to have completely fossil-free mills and products by the end of 2030. We promote a culture of diversity, equality and inclusion.
Metsä Board is listed on the Nasdaq Helsinki. In 2024 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 over 90,000 Finnish forest owners.
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