Mercer(US:MERC) Globenewswire·2026-02-12 21:30Core Insights - Mercer International Inc. reported a significant decline in financial performance for Q4 2025, with an Operating EBITDA of negative $20.1 million, compared to positive $99.2 million in Q4 2024 and negative $28.1 million in Q3 2025 [2][3][8] - The company experienced a net loss of $308.7 million ($4.61 per share) in Q4 2025, a stark contrast to a net income of $16.7 million ($0.25 per share) in Q4 2024, largely due to non-cash impairments totaling $238.7 million [3][8][34] - Despite the challenging environment, the company is focused on cost reduction and operational efficiency, aiming for $100 million in savings by the end of 2026 through its "One Goal One Hundred" program [6][8][34] Financial Performance - Total revenues for Q4 2025 decreased by approximately 8% to $449.5 million from $488.4 million in Q4 2024, primarily due to lower pulp sales realizations [14][34] - Costs and expenses in Q4 2025 increased by approximately 66% to $728.0 million from $438.0 million in Q4 2024, driven by negative foreign exchange impacts, maintenance spending, and higher fiber costs [15][34] - For the full year 2025, total revenues decreased by approximately 9% to $1.868 billion from $2.043 billion in 2024, attributed to lower pulp and manufactured products sales [34][37] Segment Performance - In the pulp segment, revenues decreased by approximately 11% to $334.3 million in Q4 2025 from $375.5 million in Q4 2024, with a significant drop in Operating EBITDA to negative $11.3 million from positive $106.1 million [18][22][34] - Lumber revenues in Q4 2025 decreased by approximately 6% to $54.9 million from $58.6 million in Q4 2024, despite a 12% increase in average sales realizations to $533 per Mfbm [28][34] - The solid wood segment's overall revenues remained relatively flat at $110.2 million in Q4 2025 compared to $111.6 million in Q4 2024, with higher revenues from manufactured products offsetting declines in lumber and biofuels [27][34] Market Conditions - Softwood pulp prices in Europe remained stable, while North American and Chinese prices decreased due to weak demand and economic uncertainty [7][19] - The company anticipates a modest increase in pulp prices in early 2026 due to stable demand and global supply constraints [7][9] - The U.S. imposed a 10% global tariff on imported lumber, significantly impacting Canadian producers, which has led to sawmill closures and tighter fiber supply [10][34] Operational Initiatives - The company is shifting its production mix towards softwood pulp and engaging with government stakeholders on energy and carbon capture opportunities to address challenges in the hardwood pulp market [4][8] - The "One Goal One Hundred" program has already realized approximately $30 million in cost savings and operational improvements during 2025, with continued focus on efficiency initiatives [6][8][34] - The mass timber order book has grown, with contracts secured for large-scale data center projects, indicating potential for future revenue growth [12][34]