Q4 2024 UPM-Kymmene Oyj Earnings Call Transcript
Key Points
- UPM-Kymmene Oyj (UPMKF) reported a 21% increase in comparable EBIT for the full year 2024, driven by strong contributions from the Paso de los Toros pulp mill and improved advanced material deliveries.
- The company achieved a 4% year-on-year sales growth in Q4 2024, with a 29% increase in comparable EBIT compared to the same period in 2023.
- UPM-Kymmene Oyj (UPMKF) implemented significant cost-saving measures, reducing fixed costs by EUR103 million compared to the previous year.
- The company maintained a strong financial position with a net debt-to-EBITDA ratio of 1.66 times and cash funds and committed credit facilities totaling EUR3.2 billion.
- UPM-Kymmene Oyj (UPMKF) announced a share buyback program, with a maximum of 6 million shares to be repurchased, complementing an unchanged dividend of EUR1.50 per share for 2024.
- The recovery in demand slowed down in the second half of 2024, impacting overall performance.
- Average pulp selling prices decreased by 11% in Q4 2024, negatively affecting EBIT.
- The company made an impairment of EUR113 million on goodwill in Finnish operations due to increased wood costs.
- UPM-Kymmene Oyj (UPMKF) faced a significant impairment of EUR373 million in the Leuna biorefinery assets due to cost overruns and construction delays.
- The biofuels and biochemicals segments had a significant negative impact on the 2025 bottom line, with biofuels affected by a downturn in advanced fuels markets.
Hello, everyone. Welcome to UPM quarter four and full year 2024 results webcast. My name is Massimo Reynaudo, I'm the CEO of UPM. Here with me is Tapio Korpeinen, the CFO. We will soon illustrate the main facts and achievements of 2024 and share some views about what's ahead of us in 2025. But let's start with the performance about the full year 2024.
Well, we improved our performance from the previous year and our comparable EBIT increased by 21%. This was driven by a good contribution from our pulp mill in Paso de los Toros and by a moderate improvement in advanced material deliveries.
As you may recall, the year started a strong recovery of the demand from the low levels of 2023. But in the second half of the year, the recovery slowed down. In this environment, we implement the decisive measures to improve our performance. For example, we reduced our fixed cost substantially, EUR103 million, in comparison with the year before.
Also, during the second half of 2024, we
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