Nordic forest products giant Metsa Group is to initiate a major cost saving programme after reporting weaker than expected financial results.
Metsa Group’s results for H1 2025 show a loss before tax of €24m (H1 2024: €19m profit), with Q2 weaker than expected with a loss before tax of €61m (Q2 2024: £26m loss).
The wood products division reported H1 2025 sales of €254.5m, with an operating loss of £3.8m.
Metsa said in much of Europe, the outlook for construction remains muted, and this is reflected in the weak demand for spruce plywood in particular.
However, demand for Kerto LVL products remains stable, and overall demand for birch plywood is expected to remain stable, but industrial customers’ demand for speciality plywood products is expected to pick up.
In the UK, demand for the upgrading business is expected to remain stable in the DIY segment but weaker than normal in the wholesale customer segment and new construction in the coming months.
Metsa said it expected the Q3 operating result to be weaker than in April–June 2025. Due to prolonged weak profitability and the uncertain market outlook, Metsä Group is to initiate the planning of a significant cost savings and profit improvement programme to achieve annual cost savings of approximately €300m – to be implemented gradually from 2026.
The programme will focus on procurement and logistics costs, the wood supply chain’s optimisation from the forest to production units, and the reduction of fixed costs. The programme does not include permanent or temporary closures of production units.
In addition, Metsä Group will aim to improve its result by updating and sharpening its commercial strategy.
The Group mentioned the recent agreement of tariffs between the US and the EU under which the US will impose a 15% tariff on almost all imports from Europe, including forest industry products.
Metsa said the competitiveness of the Nordic forest industry on the US market will depend both on local competition and on the tariff agreements the US makes with other countries.
“At this stage, it seems that our competitiveness is weakening compared to both American and Canadian operators,” it said.
