Mayr-Melnhof Karton (MMK) H2 2025 earnings summary

Executive summary

• Achieved solid performance in a challenging market with soft demand and overcapacity, supported by the Fit-For-Future program contributing €70 million to adjusted operating profit in 2025 and targeting €250 million by 2027.

• Adjusted operating profit rose 2.8% to €195.4 million (up 15% pro forma excluding TANN Group), reflecting operational improvements.

• Sale of TANN Group completed, sharpening strategic focus and generating €125.1 million one-off income.

• Balance sheet strengthened with equity ratio at 47% and net debt reduced to €913.7 million.

• Dividend proposed to increase by 11% to €2.00 per share, aligning with revised payout policy.

Financial highlights

• Group sales were €3,885.3 million, down 4.8% year-over-year, mainly due to the TANN Group divestment.

• Adjusted EBITDA stable at €418.2 million (margin 10.8%), and adjusted operating margin improved to 5.0%.

• Net profit was €77.0 million, impacted by higher tax expense from reversal of loss carryforwards.

• Free cash flow dropped sharply to €11.1 million from €302.2 million, with operating cash flow at €231.1 million.

• Equity ratio improved to 47.0%; net debt to adjusted EBITDA at 2.2x.

Outlook and guidance

• Macroeconomic and industry environment expected to remain demanding in 2026, with subdued European consumer sentiment and persistent overcapacity.

• Fit-For-Future program expected to deliver over €250 million in sustainable earnings improvement by 2027.

• Strategic investments of around €250 million planned for 2026, focusing on competitiveness, energy efficiency, and renewable energy.

• Maintenance shutdowns scheduled for Board & Paper division in Q3 and Q4, with €40 million in related expenses.

• Environmental priorities include decarbonisation, water efficiency, and waste prevention.