Metsä Group (METS) Q2 2024 earnings summary

Executive summary

• First half 2024 saw a sharp decline in sales to EUR 2,937 million, down 6% year-over-year, with comparable operating result falling to EUR 57 million from EUR 380 million, mainly due to lower sales prices and higher wood costs.

• Political strikes and a gas explosion at the Kemi mill had a combined negative impact of EUR 160 million on results.

• The Group completed the divestment of its Russian subsidiaries, positively impacting operating result by EUR 13.8 million.

• Despite weak financials, positive trends were noted in pulp markets in Europe and demand for fresh fibre paperboards.

Financial highlights

• Sales for Q1–Q2 2024: EUR 2,937 million (down from EUR 3,116 million year-over-year).

• Comparable operating result: EUR 57 million (EUR 380 million year-over-year); operating result: EUR 46 million (EUR 402 million year-over-year).

• EBITDA for the half-year was EUR 270 million (EUR 555 million in 2023), margin 9.3% (17.1%).

• Operating margin: 1.9% of sales (12.2% year-over-year); return on capital employed: 1.8% (10.7% year-over-year).

• Exchange rate fluctuations had a negative impact of EUR 13 million.

Outlook and guidance

• Comparable operating result for July–September 2024 expected to improve over April–June 2024.

• Paperboard demand and delivery volumes expected to remain stable or increase slightly in Q3 2024.

• Demand for tissue and greaseproof papers, as well as softwood market pulp in Europe and North America, expected to remain stable.

• Sawn timber demand and price expected to remain at current levels.