Finland-based Metsä Group, one of the world's leading forest industry companies, recorded sales of Euro 5.83 billion in 2025, up 1.5% from 2024, while its comparable operating result turned negative at Euro -85 million due to weak market conditions and higher fixed costs.

The Group's operating result (IFRS) was Euro -271 million, compared with Euro 186 million in 2024. Result before taxes stood at Euro -335 million, with a comparable figure of Euro -147 million. Net cash flow from operations strengthened to Euro 537 million, mainly due to working-capital optimization and inventory reductions.

Demand for market pulp remained muted in Europe and China, leading to a temporary shutdown of the Joutseno pulp mill for half the year. Average softwood pulp prices declined 1% in Europe and 3% in China during the fourth quarter. Paperboard delivery volumes and prices also fell, prompting production curtailments.

Metsä Group launched a Euro 300 million cost-savings and profit-improvement program in mid-2025 to restore competitiveness. About two-thirds of the targeted savings are expected to be realized in 2026, mainly through procurement, logistics, and wood-supply-chain efficiency measures.

President and CEO Jussi Vanhanen said the year's highlight was the strong cash flow exceeding half a billion euros, supporting a stable financing position. He noted that lower wood prices beginning in summer 2025 will start contributing to results in 2026.

Across divisions, the pulp and sawn-timber industry posted sales of Euro 2.58 billion with a comparable loss of Euro 121 million, reflecting lower pulp prices and higher raw-material costs. The paperboard industry recorded sales of Euro 1.78 billion, down 8%, and a comparable loss of Euro 80 million due to weaker folding-boxboard volumes and curtailed production. The tissue and greaseproof papers segment remained profitable, with a comparable operating result of Euro 72 million.

Wood products weakened, while forest services improved and maintained a 1.4% margin. Wood Products Industry sales declined 15% to Euro 469 million, and the comparable operating result turned negative at Euro -12 million. The decline stemmed from reduced demand for engineered-wood products in Europe, especially spruce plywood, and operational challenges from the deployment of a new ERP system. Delivery volumes decreased in birch and spruce plywood and in the UK upgrading business, though Kerto LVL volumes increased. Profitability was further pressured by higher log-wood and logistics costs and by the gradual closure of the Suolahti plywood mills in Finland, where birch production ended in March 2025 and spruce will end in summer 2026.

By contrast, Wood Supply and Forest Services operations strengthened, supported by cost savings and improved sales margins. Sales rose 4% to Euro 2.47 billion, and the comparable operating result improved to Euro 34 million, equal to 1.4% of sales.

Total investments reached Euro 621 million, including the renewal of the Simpele folding-boxboard mill and the expansion of the Mariestad tissue mill in Sweden. Construction of the new Euro 300 million Kerto LVL mill in Äänekoski progressed as planned, with full-scale production tests scheduled for 2026.

The company's equity ratio remained stable at 56.8%, and net gearing stood at 24%. The workforce declined to 8,767 employees after nearly 800 positions were terminated under the restructuring program.

For 2026, Metsä Group expects demand for pulp and paperboard to remain weak due to geopolitical uncertainty and cautious consumer spending, while seasonal recovery is anticipated in sawn-timber markets. Profit performance will depend on the pace of cost-savings realization and stabilization of raw-material prices.