Release Date: April 29, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Paperboard sales improved from the previous quarter, driven by increased delivery volumes.
- Production volumes grew compared to both the previous quarter and the corresponding period last year.
- The company performed exceptionally well in the CDP evaluation, achieving an A score in climate change, forests, and water security.
- Metsa Board Oyj has a strong market position in the US for folding boxboard and quality kraftliners.
- The company expects annual EBITDA to improve by roughly EUR30 million starting mainly from the fourth quarter of this year due to operational efficiency enhancements.
Negative Points
- Operating cash flow was negative due to increased inventory levels and prolonged weak profitability.
- The closure of the Tako mill will result in 208 job cuts.
- US tariffs have a significant impact on Metsa Board Oyj's business, creating uncertainty in financial and operational impacts.
- Overall demand for paperboards remained moderate and far from pre-pandemic levels.
- Energy efficiency weakened, and the TRIF (Total Recordable Incident Frequency) increased, indicating room for improvement in safety and efficiency.
Q & A Highlights
Q: Can you explain the dynamics behind the growing volumes in folding boxboard and declining volumes in white kraftliner in America during the quarter?
A: The decline in white kraftliner volumes was mainly due to customers ordering more in Q4 to prepare for a potential strike in Finland that did not occur. Currently, discussions with customers are ongoing, and the US tariffs are making them more cautious in their ordering, which has a negative impact.
Q: Are the market-related production curtailments more on the boxboard or liner side?
A: The planned curtailments are more on the folded boxboard side, but the extent will depend on order inflow in the coming weeks.
Q: How do you expect the pricing environment in Europe to develop in Q2 compared to Q1?
A: We are not providing forward-looking comments on prices. Prices have been stable over the past year, but the market is evolving, and we are closely monitoring it.
Q: What stops US buyers from shifting to domestically produced SBS as an alternative to your products?
A: Our value proposition in the US market is strong, with robust customer relationships and technical service. We believe our customers understand the situation with tariffs and will remain with us.
Q: Is the closure of the Tako mill enough to rebalance the market, or could there be more closures?
A: The Tako closure was a strategic move to balance our offering and improve efficiencies. We believe it will help balance the market from our perspective, especially with the new capacity at Husum.
Q: How are you managing FX exposure, and what impact do you expect in the future?
A: We hedge about eight months of forecasted currency flows, so we are almost fully hedged for this year. The overall FX impact year-on-year will be small, but if current spot rates persist, 2026 could see a bigger impact once hedges roll off.
Q: Can you provide guidance on Metsa Fibre's associated income for Q2?
A: We do not provide separate guidance on Metsa Fibre results, only on Metsa Board level.
Q: What is your vision for the company compared to your predecessor, and do you think enough has been done with capacity closures?
A: We have made strategic decisions independently to strengthen our market position. The Tako closure and Husum ramp-up were related decisions to improve efficiencies and balance our offering.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
