FALLING WOOD PRICES will positively influence Metsä Group’s earnings trajectory this year, after a stark deterioration in profitability during 2025. The Group reported a total operating loss of EUR 271 million, reversing the EUR 186 million profit recorded in 2024. On a comparable basis, the result fell to EUR –85 million from EUR 203 million a year earlier.
The negative outcome was driven by a combination of reduced sales prices and a rise in fixed costs.
Net operating cash flow remains strong
Despite the weak earnings, Metsä Group maintained robust cash generation. Operational cash flow exceeded EUR 500 million, supported by strategic deployment of inventories and working capital during the second half of 2025. Group-wide cost-saving and efficiency initiatives were also launched during the period.
As part of the programme, approximately 790 permanent employment contracts were terminated through change negotiations. These actions are expected to generate annual cost savings of EUR 300 million, with around two-thirds of the target likely to materialise within 2026. The majority of savings are expected to derive from reductions in variable cost components.
Production growth supports revenue increase
While profitability deteriorated, Metsä Group’s net sales edged up 1.5% year-on-year to EUR 5,833 million, mainly due to increased output of pulp and sawn timber.
Falling wood prices to support cost structure
CEO Jussi Vanhanen noted that FALLING WOOD PRICES, which started declining in summer 2025, will gradually benefit the Group’s cost base as previously acquired timber stands are harvested during 2026. This cost easing is forecast to support profitability throughout the year.
Vanhanen emphasised that from the forest owner’s perspective, price levels remain historically strong despite the recent decline. Wood prices are still above pre-Ukraine war levels. According to Vanhanen, weekly timber purchases by members of the Finnish Forest Industries Association have remained consistent with the average of the past three years. This includes volumes from storm-felled timber following Storm Hannes in late December, though the storm alone does not explain the elevated procurement levels.
Investment cycle pauses as Äänekoski mill nears completion
In recent years, Metsä Group has executed large-scale investment programmes, including the Äänekoski Kerto LVL mill, which is scheduled for completion during 2026.
Vanhanen stated that the Group will now pause on launching new projects, describing the current phase as “a breather” for investment activity.
Weakening demand for softwood pulp
Geopolitical instability has once again intensified, and discussions around trade barriers have re-emerged. Vanhanen acknowledged that these conditions could continue to erode consumer confidence and impact downstream demand.
The resulting macroeconomic uncertainty has already softened global demand for pulp-based products. In particular, demand for softwood pulp has declined due to increased substitution by hardwood pulp in many end-use sectors.
Vanhanen clarified that softwood pulp remains relevant, but shifting market dynamics are constraining sales volumes. Finland remains home to two of the most efficient softwood pulp mills globally, operated by Metsä Group.
While Vanhanen declined to comment on the future of the Joutseno mill specifically, he highlighted that only one pulp mill was operational in Finland at the start of 2026, reflecting subdued market demand. Future production decisions will hinge on fibre input costs and pulp price levels.
Cost alignment remains strategic priority
Adapting the Group’s cost base to global market requirements remains a key strategic priority. Vanhanen noted that Metsä Group continues to assess further investment in areas that demonstrate viable long-term profitability.
Timber trade revenue declines moderately
In 2025, Metsäliitto Cooperative disbursed EUR 641 million in timber trade income to its owner-members. This figure was EUR 40 million below the prior year, though consistent with 2023 levels.
The Board of Directors has proposed a 5.0% interest payment on statutory basic shares held by members for the year, down from 5.5% the year before. Proposed interest rates for other share categories include 4.5% for Metsä1 additional shares (previously 5.0%), 1.0% for additional capital A (2.0%), and 0.75% for additional capital B (1.0%).
2025 financial summary
| Metric | 2025 | 2024 |
|---|---|---|
| Net sales | EUR 5,833 million | EUR 5,747 million |
| Operating result | EUR –271 million | EUR 186 million |
| Comparable operating result | EUR –85 million | EUR 203 million |
| Result before taxes | EUR –335 million | EUR 131 million |
| Comparable result before taxes | EUR –147 million | EUR 148 million |
| Comparable return on investment | –0.9% | 2.9% |
| Net cash flow from operations | EUR 537 million | EUR 11 million |
