Stora Enso Q3 adjusted operating profit falls as Oulu ramp-up impacts

Core Insights - Stora Enso reported a 28% decline in adjusted EBIT to €126 million in Q3 2025, down from €175 million in the same quarter of 2024, primarily due to a €45 million negative impact from the ramp-up of a consumer board line at its Oulu site [1] - The adjusted EBIT margin decreased to 5.5% from 7.8% year-over-year, while sales increased by 1% to €2.28 billion, driven by the Junnikkala acquisition and the Oulu ramp-up [1] Financial Performance - Operating profit rose to €231 million from €139 million, influenced by €117 million of items affecting comparability [2] - Basic earnings per share increased to €0.25 from €0.11, while cash flow from operations fell to €223 million from €271 million in Q3 2024 [2] - The divestment of 175,000 hectares of forest land in Sweden for Skr9.8 billion (€900 million) reduced the net debt-to-adjusted EBITDA ratio to 2.7 from 3.1 [2][3] Asset Valuation - The fair value of forest assets decreased to €8.3 billion from €8.8 billion a year earlier, equating to €10.50 per share, reflecting the impact of the Swedish disposal [3] Market Outlook - The company anticipates continued pressure on packaging and pulp markets due to weak consumer confidence and soft order intake, expecting prices to remain flat or decline through Q4 [4] - Capital expenditure for 2025 is projected to be between €730 million and €790 million, with maintenance stoppages expected to be similar to Q3 levels [4] Strategic Focus - The completed Swedish forest sale is expected to have an annual adverse impact of €25 million on the Forest segment's results, approximately €6 million per quarter starting in Q4 [5] - For the remainder of 2025, the company aims to enhance profitability, cash flow, and cost competitiveness through improved sourcing efficiency and fixed cost reduction [5] - Stora Enso plans to further integrate its Nordic packaging board mills and continue a strategic review of its remaining Swedish forest assets, including a potential separation and listing [6] Leadership Perspective - The CEO emphasized the company's commitment to executing its strategy and profit improvement actions despite challenging market conditions, focusing on controllable areas [6] - The leadership aims to lay the foundation for a stronger, more focused company that is better positioned for long-term value delivery [7]