UPM accelerates portfolio shift, shedding legacy assets for bio-based future
Finnish forestry group UPM-Kymmene reported a 47% drop in third-quarter comparable operating profit, citing weak markets and subdued consumer demand.
Sales for the quarter fell to 2.3 billion euros from 2.52 billion euros a year earlier, while comparable earnings before interest and taxes (EBIT) declined to 153 million euros, the company said Wednesday.
The results come as UPM accelerates a strategic shift, announcing it will end paper production at its Kaukas mill in Finland by the end of 2025 and has initiated a strategic review of its plywood business.
The company also sold a closed paper mill site in Germany and is investing in its adhesive materials business in the U.S. and Asia.
Meanwhile, UPM said its new biorefinery in Leuna, Germany, successfully started its first core process, with commercial production expected to begin by the end of the year.
“During the quarter, we continued to take decisive actions to further strengthen our competitiveness,” CEO Massimo Reynaudo said.
“Our focus is on improving performance, cash flow and the strength of our balance sheet.”
UPM expects comparable EBIT for the second half of 2025 to be between 425 million and 650 million euros, but noted that significant uncertainties in global trade remain.
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UPM-Kymmene has agreed to sell a sawmill to Finland's largest private timber producer, Versowood, in a deal aimed at securing wood supplies for its pulp business amid high costs.
Finnish forestry group UPM-Kymmene said Tuesday it has started a strategic review of its plywood business, which could lead to a sale, demerger or an initial public offering of the unit.
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