Stora Enso Reports Higher Q2 Adjusted EBIT as Consumer Packaging Ramp-Up Boosts Performance

Stora Enso reported improved second-quarter profitability as the continued ramp-up of its new consumer board production line in Oulu, Finland, supported earnings despite weak market conditions, lower selling prices and geopolitical uncertainty. The company also advanced several strategic initiatives, including preparations to separate its Swedish forest assets business and investments in specialty pulp production.

Second-quarter sales remained broadly stable at EUR 2.423 billion, compared with EUR 2.426 billion a year earlier. Positive contributions from structural changes, including the Oulu consumer board line and the Junnikkala acquisition, offset lower prices and adverse currency movements. Adjusted EBITDA increased 14.5% to EUR 320 million, while adjusted EBIT rose 27% to EUR 160 million, lifting the adjusted EBIT margin to 6.6% from 5.2% in the prior-year period.

Reported operating profit (IFRS) declined to EUR 16 million from EUR 64 million due to EUR 83 million of items affecting comparability, primarily impairments and restructuring costs, and EUR 61 million of fair valuation and other non-operational items. Earnings per share were EUR -0.03, compared with EUR 0.03 a year earlier.

For the first six months of 2026, sales totaled EUR 4.781 billion, compared with EUR 4.789 billion in the corresponding period of 2025. Adjusted EBIT increased to EUR 319 million from EUR 301 million, while reported operating profit was EUR 101 million, compared with EUR 235 million a year earlier. Operating cash flow amounted to EUR 212 million, down from EUR 336 million, mainly due to less favorable working capital development.

President and CEO Hans Sohlström said the company continued to improve operational performance, strengthen customer relationships and execute strategic priorities despite a volatile market environment. He highlighted encouraging progress in Consumer Packaging, where customer feedback remained positive and the company continued to gain momentum through investments in advanced production technology.

The Consumer Packaging segment delivered the strongest performance during the quarter. Sales increased 3.4% to EUR 985 million, while adjusted EBIT nearly tripled to EUR 64 million from EUR 22 million, supported by higher production volumes from the Oulu consumer board line, improved operational performance and lower variable costs. Order inflow remained strong in selected product categories, although demand for European consumer board grades remained mixed.

The Integrated Packaging segment reported sales of EUR 599 million, down 4.2%, while adjusted EBIT declined to EUR 29 million from EUR 33 million. Lower corrugated packaging volumes in Western Europe and reduced energy subsidies weighed on results, although lower wood, recovered paper and fixed costs partially offset the decline. Demand for virgin containerboard continued to improve, supported by price increases.

The Biomaterials segment generated sales of EUR 410 million, broadly in line with the previous year, while adjusted EBIT increased 55% to EUR 65 million. Lower wood costs, reduced fixed costs and lower maintenance activity supported profitability. The company said the softwood pulp market remained weak, while hardwood and fluff pulp markets were more stable with sequential price improvements.

The Other segment recorded sales of EUR 631 million, down 4.2%, while adjusted EBIT declined to EUR 7 million from EUR 37 million. Results were affected by lower external wood prices in Sweden and weaker margins in Central European wood products operations.

During the quarter, Stora Enso continued preparations for the planned separation of its Swedish forest assets business into a new publicly listed company, expected to be completed during the first half of 2027. The company also continued its strategic review of its Central European sawmills and building solutions operations. In July, it completed the divestment of its corrugated board production units in Germany as part of its asset optimization strategy.

The company announced a EUR 19 million investment to increase fluff pulp production capacity at its Skutskär mill in Sweden to meet growing demand for hygiene products. As part of the transition, softwood pulp production on Fiberline 3 will be permanently shut down during the third quarter of 2026.

Capital expenditure during the second quarter declined 56% to EUR 96 million, while the company expects total capital expenditure for 2026 to remain below EUR 550 million, approximately EUR 200 million lower than in 2025. Major ongoing investments include the corrugated packaging plant expansion in Ostrołęka, Poland, and fluff pulp capacity upgrades at Skutskär.

Stora Enso strengthened its balance sheet during the reporting period by issuing EUR 1 billion in hybrid bonds, reducing net debt to EUR 2.619 billion from EUR 3.988 billion a year earlier. The net debt-to-adjusted EBITDA ratio improved to 2.2x, while available committed undrawn credit facilities totaled EUR 800 million at the end of June.

On sustainability, the company published its Circularity Plan aligned with the Global Circularity Protocol for Business and introduced a target to achieve 90% material circularity in its direct operations by 2030. Scope 1 and Scope 2 greenhouse gas emissions were 61% below the 2019 baseline at the end of the second quarter, while forest certification coverage remained at 99%.

Looking ahead, Stora Enso said market conditions remain uncertain due to geopolitical tensions, trade-related volatility and continued pressure on customer demand. Planned maintenance shutdowns across operational segments are expected to reduce third-quarter adjusted EBIT by approximately EUR 40–50 million, while the Oulu consumer board line is expected to continue ramping up toward full production capacity during 2027.