Finnish Forest Industry Leader UPM-Kymmene Returns to Profitability in Q4, Guides H1 2026 in Million Euros Range

UPM-Kymmene Oyj (UPMKF, RPL.F), the Helsinki-based forest products manufacturer, swung to profitability in the fourth quarter, marking a notable turnaround from the prior year’s loss. The company’s return to the black in Q4, combined with its forward guidance denominated in million euros terms, underscores management’s cautious optimism despite a challenging fiscal 2025 environment.

For the quarter, the Finnish company posted net profit of 258 million euros, or 0.49 euro per share, reversing a 95 million euros loss recorded a year earlier. On a comparable basis—which strips out one-time items—Q4 earnings reached 300 million euros or 0.57 euro per share, though this still represents a modest pullback from 328 million euros or 0.61 euro per share in the year-ago quarter.

Q4 Operating Performance Reflects Industry Headwinds

Comparable EBIT for the quarter declined 15% year-over-year to 355 million euros, with the operating margin compressing to 15.3% from 15.9% a year prior. The company’s comparable EBITDA slipped to 382 million euros from 436 million euros previously, though the EBITDA margin held steady at 16.5%. Revenue softness was evident, with sales contracting to 2.312 billion euros from 2.632 billion euros, signaling weaker market conditions in the forest products sector.

Full-Year 2025: Earnings Pressure and Strategic Patience

The complete 2025 fiscal year told a similar story of industry pressure. Comparable EBIT tumbled 25% compared to 2024, landing at 921 million euros with margin compression across the business. Annual sales declined to 9.656 billion euros from 10.339 billion euros in the prior year, reflecting persistent softness in global demand.

Forward Guidance and Capital Return Strategy

Looking ahead to the first half of 2026, UPM-Kymmene projects comparable EBIT to land in the range of 325 million euros to 525 million euros, compared to 413 million euros in H1 2025. This wide guidance band reflects uncertainty about market recovery timing but suggests management’s belief in operational flexibility.

Most notably, the company’s Board of Directors has proposed maintaining the dividend at 1.50 euros per share for 2025, representing 113% of comparable earnings per share. This unchanged payout ratio—despite the earnings headwinds—signals Board confidence in UPM’s long-term strategy and cash generation capability in euro-denominated terms. The decision reflects a commitment to shareholders even as the company navigates near-term cyclical weakness.

In Helsinki trading, UPM shares were quoted at 23.61 euros, down 0.55% on the session, as investors weighed the company’s resilience against sector headwinds.