Metsä Board improved its comparable operating profit to €5.5 million in the third quarter of 2026, supported by lower costs, slightly higher paperboard prices and approximately €10 million in tariff refunds.
Continued losses at its Husum mill in Sweden and weak pulp markets nevertheless underscore the fragility of the improvement.
The Finnish paperboard producer reported sales of €402.3 million for July–September, compared with €441.2 million a year earlier. Comparable operating profit increased from €3.1 million in the second quarter and a loss of €45.6 million in the third quarter of 2025.
The improvement marked the fourth consecutive quarter of stronger comparable operating results, although profitability remains well below the company's targets.
Cost reductions support earnings
Lower wood and chemical costs, reduced fixed expenses and measures implemented under Metsä Board's transformation programme contributed to the improvement.
Paperboard delivery volumes remained broadly stable from the previous quarter, while average selling prices increased slightly.
During the October 29 earnings call, Chief Financial Officer Anssi Tammilehto also noted that sales of emission allowances were approximately €5 million higher than in the second quarter.
By the end of September, implemented transformation measures represented an estimated €148 million in annualised EBITDA run-rate improvement, rather than earnings generated during the quarter.
Capacity adjustments improve the pricing environment
During the earnings call, CEO Esa Kaikkonen estimated that capacity adjustments across the European and U.S. folding boxboard (FBB) and solid bleached sulfate (SBS) markets amounted to approximately one million tonnes over the past year.
According to Kaikkonen, these changes have improved the balance between supply and demand, creating a more favourable environment for paperboard pricing.
Approximately 40% of Metsä Board's folding boxboard volumes are covered by annual customer agreements involving prices and volumes.
Kaikkonen said the company is entering negotiations for 2027 in a stronger position than a year earlier but declined to predict their outcome.
He also highlighted the importance of energy costs and supply reliability in discussions with customers, noting that Nordic producers may benefit from their comparatively strong energy position.
Husum's recovery requires more than higher demand
Despite improving paperboard market conditions, Metsä Board's Husum mill complex in Sweden remains loss-making, primarily because of low capacity utilisation.
The mill experienced a prolonged market-related production shutdown in July, while annual maintenance outages also affected third-quarter production.
In response to an analyst's question, Kaikkonen explained that increasing Husum's volumes is a gradual process, requiring customer qualifications and integration into established packaging supply chains before significant deliveries can develop.
Kaikkonen said the company is prioritising profitable business rather than increasing production simply to raise capacity utilisation.
One concrete step has been the expansion of sheeting capacity at Winschoten in the Netherlands. Production at the facility has reached its planned level and is supporting a gradual increase in folding boxboard volumes from Husum.
Kaikkonen also identified potential opportunities in the United States, where higher SBS prices and changes in domestic capacity could improve the competitive position of imported folding boxboard.
Metsä Board is developing its customer base in food, pharmaceutical and branded consumer packaging. However, the foodservice board market remains particularly competitive, and the company has acknowledged losing market share in that segment.
No timetable has been announced for Husum's return to profitability.
Fourth-quarter costs remain a concern
Weak market pulp demand continues to weigh on Metsä Board's performance. Metsä Fibre's Joutseno pulp mill has remained in a market-related shutdown since the end of March, also affecting Metsä Board's BCTMP operations at the site.
For the fourth quarter, Metsä Board expects paperboard deliveries to decline seasonally, while previously implemented price increases should continue supporting profitability.
Energy costs are expected to rise, and the tariff refunds recorded in the third quarter will not recur. Lower mill maintenance expenses should provide some relief, although other fixed costs, particularly personnel expenses, are expected to increase.
The company also expects operating cash flow to decline from the third quarter.
