Upm-kymmene Oyj · OMXHEX:UPM
Upm-kymmene Oyj — Q2 2025 Earnings Presentation
28 slides from Upm-kymmene Oyj's earnings presentation, Jul 24, 2025
Slide 1: UPM Half Year Financial Report 2025
UPM Half Year Financial Report 2025 CEO Massimo Reynaudo July 24, 2025
Slide 2: Q2 2025: Securing performance in a turbulent global trade environment
Q2 2025: Securing performance in a turbulent global trade environment Q2 2025 in brief Comparable EBIT • Sales totaled €2,400 million (€2,546 million in Q2 2024) €M • Comparable EBIT decreased by 31% to €126 million, 800 5.2% of sales (€182 million, 7.2%) 700 • Operating cash flow was €179 million (
Slide 3: Global trade uncertainties and currency changes affected pulp and communication paper markets
Global trade uncertainties and currency changes affected pulp and communication paper markets in Q2 2025 Resilient demand for Trade uncertainties advanced materials affected customers’ During peak trade Weak demand for decisions uncertainty low communication papers purchases of pulp and Resilient de
Slide 4: Comparable EBIT in Q2 2025
Comparable EBIT in Q2 2025 €M €M 450 350 400 287 300 10.8% 350 250 300 250 200 182 200 7.2% 150 126 5.2% 126 150 5.2% 100 100 50 50 0 0 4 | © |UPM © UPM
Slide 5: Comparable EBIT by business area
Comparable EBIT by business area €M UPM Fibres *) % of sales €M UPM Communication Papers % of sales €M UPM Specialty Papers % of sales 320 40 300 25 80 24 280 35 70 21 240 20 240 30 60 18 200 25 50 15 180 15 160 20 40 12 120 15 120 10 30 9 80 10 20 6 60 5 40 5 10 3 0 0 0 0 0 0 -40 -5 -60 -5 €M UPM E
Slide 6: Solid financial position
Solid financial position Net debt and leverage Net debt Net debt/ €M EBITDA (x) • Net debt €3,310m at the end of Q2 2025 3,0 5 000 • Net debt / EBITDA 2.12 2,5 • Cash funds and committed credit facilities 4 000 2,0 €2.7bn at the end of Q2 2025 3 000 Policy: ≤ 2x • No financial covenants 1,5 • UPM re
Slide 7: UPM Biorefining progress
UPM Biorefining progress • Biofuels reached EBIT break-even in Q2, with higher deliveries and decreased costs • Biochemicals successfully started the first of the Leuna refinery’s three core processes • The biorefinery is expected to reach full production and positive EBIT in 2027 Comparable EBIT, €
Slide 8: UPM and tariffs – global trade uncertainties continue
UPM and tariffs – global trade uncertainties continue 14% of UPM sales in 2024 was to the U.S. • In Q2, the global trade uncertainties and weaker U.S. dollar affected particularly UPM Fibres and 40% UPM Communication Papers locally • Indirectly, tariffs may impact demand and trade produced 60% impor
Slide 9: Foreign exchange exposure
Foreign exchange exposure Estimated 12-month net currency cash flow at the end of Q2 2025, before hedging, € million USD 1,154 • At the end of Q2 2025, UPM’s estimated net UYU -293 currency cash flows for the next 12 months GBP 217 totaled approximately €1.5 billion CNY 150 • In addition, the earnin
Slide 10: Outlook
Outlook (* • Profit guidance: UPM’s comparable EBIT in H2 2025 is expected to be approximately in the range of €425-650 million (€413 million in H1 2025, and €709 million in H2 2024). • Outlook: In H2 2025, compared with H1 2025, UPM’s performance is expected to benefit from lower variable costs, in
Slide 11: We act on three fronts
We act on three fronts 1 2 3 Improve Focused World-class competitiveness growth businesses 11 | © UPM
Slide 12: Renewable fibres
Renewable fibres • #3 globally, #1 multi-fibre Uruguay • 3.4 million tonnes eucalyptus pulp • World-class low-cost platform in full operation • Optimization and efficiency measures ongoing • Debottlenecking potential Finland • 2.4 million tonnes, mainly softwood pulp • Profitable in Q2, but affected
Slide 13: Communication papers
Communication papers • Strong #1 in Europe • Reliable provider of sustainable communication papers, cost-efficient operations • Business affected by the trade uncertainty and weaker U.S. dollar. Q2 demand declined both in Europe (-9% yoy) and the U.S. • Plan to close the UPM Ettringen paper mill (27
Slide 14: Advanced materials
Advanced materials Adhesive Materials • Strong global #2 • Resilient labeling markets (Q2: Europe -1%, NA +3% yoy) • Actions to sharpen competitiveness, improve margins • Investments to grow in advanced labels in the U.S. and to strengthen asset base in Southeast Asia • Building position in graphics
Slide 15: Decarbonization solutions
Decarbonization solutions Biochemicals • 220,000 tonnes of pioneering biochemicals • Commercial interest confirmed • Integrated commercial production expected by the end of 2025, full production and positive EBIT in 2027 • Gather learnings for next steps Biofuels • 130,000 tonnes of advanced renewab
Slide 16: UPM Leuna biorefinery has successfully tested and started up first of the three main processes
UPM Leuna biorefinery has successfully tested and started up first of the three main processes 16 | © UPM
Slide 17: Summary
Summary • In Q2, the global trade uncertainties and weaker U.S. dollar affected particularly UPM Fibres and UPM Communication Papers • Advanced materials businesses have shown resilience, implement measures to improve competitiveness and capture focused growth • Biofuels improved its performance and
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Slide 19: Our business portfolio, leveraging competitive business platforms
Our business portfolio, leveraging competitive business platforms • Decarbonization solutions biochemicals, biofuels, CO2-free energy • Advanced materials adhesive materials, specialty papers, plywood • Renewable fibres pulp, other bioproducts • Communication papers 19 | © UPM
Slide 20: Major investment cycle coming to an end
Major investment cycle coming to an end Capital expenditure Estimate Capex 2025 estimate €M 1 600 1 400 • Capex excluding acquisitions €400m 1 200 Strategic investments • Operational investment 1 000 needs consistently low 800 600 Depreciation 400 200 Operational investments 0 2009 2010 2011 2012 20
Slide 21: Maintenance shutdowns in 2025
Maintenance shutdowns in 2025 Timing Unit Q1-Q2 25 Olkiluoto nuclear power plant OL3 Q2 25 Olkiluoto nuclear power plant OL1 and OL2 Maintenance shutdowns have UPM Paso de los Toros pulp mill an impact on UPM Kymi pulp mill • Maintenance costs Q3 25 UPM Kaukas pulp mill • Production volumes • Operat
Slide 22: Maturity profile and liquidity
Maturity profile and liquidity EURm 2 000 Liquidity on June 30, 2025, was €2.8bn (cash funds and unused committed credit facilities) 1 500 UPM’s committed credit facilities: • €159m rolling committed overdraft facility maturing 2026 • €300m bilateral revolving credit facilities 1 000 (€100m maturing
Slide 23: UPM Fibres: Chemical pulp market prices
UPM Fibres: Chemical pulp market prices Pulp market prices, euros Pulp market prices, U.S. dollars €/tonne $/tonne 1700 1700 1500 1500 1300 1300 1100 1100 900 900 700 700 500 500 300 300 BHKP, Europe, EUR NBSK, Europe, EUR BHKP, Europe NBSK, Europe BHKP, China, EUR NBSK, China, EUR BHKP, China NBSK,
Slide 24: UPM Energy: Electricity market prices
UPM Energy: Electricity market prices Market electricity prices vs UPM sales price €/MWh 240 220 200 180 160 140 120 100 80 60 40 20 0 2020 2021 2022 2023 2024 2025 Helsinki Front Year System Front Year UPM average sales price UPM Energy 2020 2021 2022 2023 2024 H1 2025 profitability Comparable EBIT
Slide 25: UPM Adhesive Materials: Label materials demand has recovered above pre-covid level
UPM Adhesive Materials: Label materials demand has recovered above pre-covid level European North American M m2 market shipments M m2 market shipments 2 200 1 300 2 000 Q2 2025: Q2 2025: -1% y-o-y +3% y-o-y -5% q-o-q 1 200 -1% q-o-q 1 800 Total 1 100 1 600 Excl. Russia 1 000 1 400 and Belarus 1 200
Slide 26: UPM Communication Papers: Graphic paper prices
UPM Communication Papers: Graphic paper prices Europe North America China €/t $/t $/t 1300 1700 1400 1200 1600 1300 1500 1100 1200 1400 1000 1300 1100 900 1200 1000 800 1100 900 700 1000 900 800 600 800 700 500 700 400 600 600 300 500 500 WFC r (100% chemical pulp) News SC LWC WFC WFU News SC LWC WF
Slide 27: Paper price vs. cash cost of marginal cost producer
Paper price vs. cash cost of marginal cost producer EUR/tonne Price Cash cost of a marginal producer 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Sources: UPM, PPI, Fastmarkets RISI, AFRY 27 | © UPM
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