Norske Skog reported weaker financial results for the second quarter of 2026 as a stronger Norwegian krone and lower other operating income weighed on earnings. Despite the decline, the company reached two key milestones in its packaging paper business, setting a record for recycled containerboard deliveries and achieving its first positive EBITDA margin for the segment.
The company posted EBITDA of NOK 73 million and a loss before income taxes of NOK 163 million, compared with EBITDA of NOK 451 million and a pre-tax profit of NOK 236 million in the first quarter. Total operating income declined to NOK 2,584 million, from NOK 2,877 million in the previous quarter.
Norske Skog ended the quarter with an equity ratio of 41%, cash of NOK 723 million, and net interest-bearing debt reduced to NOK 4,361 million from NOK 4,502 million, reflecting disciplined liquidity management and the receipt of approximately NOK 470 million in energy refunds.
Packaging paper reaches a milestone
The packaging paper segment continued its strong operational progress, with record recycled containerboard deliveries of 122,000 tonnes. For the first time, the combined packaging paper operations at Bruck and Golbey generated a positive EBITDA margin.
Bruck PM3 produced 52,000 tonnes and reported EBITDA of NOK 25 million, while Golbey PM1 delivered 70,000 tonnes with an EBITDA loss of NOK 24 million as the machine continues its production ramp-up. Norske Skog expects Golbey PM1 to reach full utilisation during the first half of 2027.
Higher deliveries, implemented price increases, improved operating efficiency and active energy market management all contributed to the segment's performance.
Publication paper remains profitable
The publication paper segment maintained profitability and market share despite challenging market conditions.
Higher prices and deliveries partly offset the impact of the stronger Norwegian krone on revenue, while lower pulpwood prices reduced raw material costs. Employee benefit expenses increased following salary adjustments across the company's mills.
NND proceeds to strengthen cash position
Norske Skog expects its financial position to improve further in the third quarter through the completion of its transaction with Norwegian Nuclear Decommissioning (NND).
The company anticipates receiving approximately NOK 780 million in cash proceeds, of which around NOK 50 million will be allocated to dismantling costs. A gain of approximately NOK 330 million will be recognised upon completion of the transaction, boosting both EBITDA and other operating income in the third quarter.
Strategic projects advance
At Saugbrugs, the NND transaction is expected to close early in the third quarter, allowing the mill to continue producing SC magazine paper under a lease agreement until the planned handover in 2028. The company is also evaluating a potential rebuild of PM6 for SC magazine paper or TMP-based kraftliner production, alongside feasibility studies for a possible Green Mountain data centre project.
At Skogn, the rebuild of PM1 for book paper production was completed in April. Commercial deliveries under the NOR Book brand are expected to increase during the second half of 2026, allowing the mill to switch between newsprint and book paper while reducing exposure to lower-margin export markets.
Norske Skog is also pursuing energy initiatives. At Bruck, the company is evaluating a 20 MW battery energy storage system that could reduce electricity costs and generate additional revenue through grid services. At Golbey, it is studying an expansion of its biogas project that would increase renewable gas deliveries from 16 GWh to 70–90 GWh annually, with commissioning targeted for 2028.
Separately, Norway's Ministry of Climate and Environment has decided to exclude the Skogn and Saugbrugs mills from the EU Emissions Trading System (EU ETS) for the 2026–2030 period under revised eligibility criteria. Norske Skog said it is continuing discussions with the authorities.
Leadership changes
Norske Skog also announced management changes at two of its mills.
At Golbey, President Yves Bailly stepped down after more than 30 years with the Group. CEO Geir Drangsland has assumed interim leadership through December 2026, supported by Senior Vice President Business Development Christoffer Bull, to oversee the continued ramp-up of PM1.
At Skogn, Mads Eikeland, currently Chief Financial Officer, has been appointed Managing Director effective Sept. 1, succeeding Håvard Busklein.
Outlook
Norske Skog expects to continue increasing market share in a challenging operating environment while maintaining a strong focus on cost reductions and working capital discipline.
The company remains committed to expanding its packaging paper business, with full utilisation of Golbey PM1 targeted for the first half of 2027, while continuing to evaluate projects that diversify revenue streams across its European mill network.
Norske Skog operates four paper mills in Europe with an annual production capacity of approximately 800,000 tonnes of packaging paper and 1.2 million tonnes of publication paper. The company employs about 1,650 people and is listed on the Oslo Stock Exchange under the ticker NSKOG.
