Rottneros Reports Improved Q2 Profitability as Lower Wood Costs Offset Weaker Pulp Prices and Sales

Rottneros AB reported improved profitability for the second quarter of 2026 despite lower revenue, as declining wood prices and cost reductions offset weaker pulp prices and lower delivery volumes. The company posted EBITDA of SEK 31 million, compared with negative SEK 15 million in the same period last year, while net turnover fell 16% to SEK 612 million.

The decline in revenue was driven by a 7% decrease in sales volumes, lower market prices for pulp, and a weaker U.S. dollar against the Swedish krona. Net prices for NBSK pulp in SEK were 12% lower than a year earlier, while CTMP prices remained relatively stable. Production increased slightly to 91,900 tonnes, but deliveries declined to 84,700 tonnes due to reduced finished-goods inventories following lower production in the first quarter. Demand in Rottneros’ prioritized chemical softwood pulp niches remained stable, while the CTMP market showed modest improvement but continued to face weak conditions.

The company attributed the earnings improvement primarily to significantly lower variable and fixed costs. Variable costs declined by SEK 82 million year-on-year, supported by lower pulpwood, chemical and fuel costs, while fixed costs were reduced by SEK 22 million through a savings program implemented in 2025. The price of pulpwood has fallen by around 20% from its peak in the first half of 2025, providing additional support to earnings.

Net income for the quarter improved to negative SEK 11 million from negative SEK 158 million a year earlier, when results were affected by a SEK 140 million impairment of non-current assets. EBIT improved to negative SEK 6 million from negative SEK 191 million in the second quarter of 2025.

For the first half of 2026, operating cash flow totaled negative SEK 81 million, while investments were reduced to SEK 11 million, compared with SEK 67 million in the corresponding period last year. Rottneros said it has slowed investment spending following major investment programs in recent years and expects total investments of around SEK 60 million for the full year, down from SEK 166 million in 2025. Working capital also declined by SEK 164 million compared with the end of the second quarter of 2025.

The group's financial position remained strong, with an equity/assets ratio of 60%, above its long-term target of at least 50%, available liquidity of SEK 171 million, and net debt of SEK 431 million.

President and CEO Per Bjurbom said earnings moved "clearly in the right direction" during the quarter despite continued global uncertainty and lower turnover. He said demand in the company's chemical softwood pulp niches remained stable and that Rottneros continues to prioritize cost efficiency, production availability and cash flow. Bjurbom also noted that commercial production at Rottneros Packaging has now been transferred to the company's jointly owned operation in Poland, while the Sunne site is focused on customer service and product development.

Looking ahead, Rottneros said the market for market pulp remains characterized by overcapacity despite some production curtailments. Demand for paper and paperboard improved in Europe during the quarter due to global supply chain disruptions and lower imports, while increasing pulp supply from China continues to create competitive pressure. The company said it remains focused on improving efficiency, reducing costs and expanding its niche market strategy.