Metsä Group reported a loss for the first half of 2026, with lower average prices for softwood market pulp and folding boxboard, weaker delivery volumes, adverse exchange-rate effects and higher financing costs weighing on the group's performance. However, profitability improved significantly in the second quarter, while the Tissue and Greaseproof Papers business delivered a comparatively resilient performance, supported by strong tissue volume growth and cost savings.

Group financial performance

Metsä Group's sales in January–June 2026 totaled €2.741 billion, down from €3.069 billion in the first half of 2025. EBITDA was €231.2 million, compared with €249.6 million a year earlier, while comparable EBITDA was €256.7 million, versus €265.1 million.

The Group reported an operating loss of €33.5 million, compared with an operating profit of €5.6 million in H1 2025. The comparable operating result was -€7.0 million, down from €44.3 million, corresponding to a comparable operating margin of -0.3%, compared with 1.4% a year earlier.

The result before income tax was -€74.3 million, compared with -€23.9 million in H1 2025, while the result for the period was -€62.3 million, compared with -€21.4 million.

The picture improved considerably in Q2. Sales were €1.383 billion, compared with €1.427 billion in Q2 2025, while EBITDA increased to €116.6 million from €60.1 million.

Comparable EBITDA rose to €129.0 million from €68.2 million, and the comparable operating result improved to -€3.2 million from -€36.6 million.

“Metsä Group’s Q2 result improved significantly compared with the corresponding period in 2025, when the new US tariff policy had a particularly severe impact on the profitability of our pulp and paperboard businesses. Our EBITDA rose from EUR 60 million to EUR 117 million. Our comparable operating profit was still slightly negative (EUR -3 million) but improved significantly from last year’s EUR -37 million. With the exception of our wood products business, profitability improved across all business operations compared with a year ago, although the level remains clearly insufficient. 

“A year ago, we launched a cost saving program of EUR 300 million. It has exceeded expectations. Our original target was to achieve permanent annual savings of EUR 300 million by the end of 2027, but it now seems we will significantly exceed that target. Our personnel have done an excellent job of identifying areas for savings and implementing projects.”President and CEO Jussi Vanhanen

Cost savings offset some of the pressure

Metsä Group's €300 million cost-saving and profit-improvement program, launched in July 2025, is progressing faster than initially expected. The company now expects to significantly exceed the original target, with the EBITDA run-rate target expected to be achieved at the beginning of Q3 2026. At least two-thirds of the program's target impact is expected to be realized in 2026, with the full impact expected in 2027.

Savings during Q2 came from improvements in production efficiency, renewed purchasing agreements, increased competitive tendering, supplier-base consolidation and optimisation of logistics and the wood supply chain.

However, the conflict in the Middle East reduced the Q2 savings impact by around €12 million, as oil and gas prices increased, affecting logistics, energy and certain raw materials. Metsä Group estimates that if oil remains at US$100 per barrel, compared with the previous level of US$70, annual costs would increase by approximately €200 million.

This represents a significant risk to the benefits of the cost-saving programme and is particularly relevant for energy-intensive paper and tissue operations.

Tissue and Greaseproof Papers: strong volume growth offsets price pressure

The Tissue and Greaseproof Papers business, Metsä Tissue, was the strongest-performing major industrial business in the first half, reporting a positive comparable operating result while Pulp and Sawn Timber, Paperboard and Wood Products all remained negative.

Metsä Tissue's sales increased 2.0% to €576.1 million, from €564.8 million in H1 2025. Tissue paper deliveries rose 8.5% to 242,000 tonnes, from 223,000 tonnes.

The business reported an EBITDA of €55.0 million, compared with €37.9 million a year earlier, while comparable EBITDA increased to €59.4 million from €48.7 million.

Its operating result rose to €21.6 million, from €13.9 million, while the comparable operating result was €26.0 million, essentially unchanged from €25.8 million in H1 2025. The comparable operating margin was 4.5%, compared with 4.6%, while comparable ROCE was 6.1%, compared with 6.5%.

The figures point to a notable divergence between volume and pricing. While tissue deliveries increased by 8.5% in H1, sales grew by only 2%. In Q2, tissue volumes increased 7% year on year, while average selling prices were 6% lower.

Q2 tissue sales reached €285.5 million, compared with €281.0 million in Q2 2025, while the comparable operating result improved to €10.8 million from €10.2 million.

The performance therefore reflects stronger volumes and cost discipline helping to offset lower selling prices and higher costs.

Variable costs began rising in Q2 as a result of the Middle East conflict, while fixed costs were lower year on year thanks to the cost-saving measures. At the same time, increased depreciation related to the renewed Mariestad tissue mill affected the comparable operating result.