Latest news with #pulp
Yahoo
6 days ago
- Business
- Yahoo
Södra Reports Q2 Loss on Weaker Demand, Currency Headwinds
Södra's second quarter of 2025 delivered lower sales and profits, citing global uncertainty, currency headwinds and weakened demand—reflecting a challenging environment for the Swedish pulp producer. The group's net sales reached roughly $752.5 million (7.2 billion Swedish kronor), down 4 percent compared against the year-over-year (YoY) period. Operating loss totaled about $40.3 million, where exchange-rate effects of just over $60 million were charged to earnings compared with the year-earlier period. The result corresponds to an operating margin dip of 5 percent, the forest owner association said. Return on capital employed was 7 percent, rolling 12-month, with an equity ratio of 57 percent. More from Sourcing Journal Brightplus Scores Growth Funding, Accelerates Circular Innovation Circle-8 Powers Reju's Circular Textile Network in UK Material (Matters) World: Aifunghi's Mycelium Bound, Fluffy Furniture 'The second quarter was challenging for Södra,' said Lotta Lyrå, president and CEO of Södra. 'Increased global uncertainty—combined with rapid currency fluctuations and high raw material prices—has created a triple external effect that puts pressure on our profitability and has had a negative impact on our results.' Sweden's largest forest owners' association faced a tough quarter as recessionary pressure, rising trade tariff concerns and a strengthening Swedish krona weighed on its performance. The sharp rise in the krona— especially against the U.S. dollar, Södra said—hit export-heavy segments like pulp, where currency translation effects were significant. Demand for paper pulp declined, too, driven in part by shifting consumer habits. Scheduled maintenance shutdowns at two facilities also dented earnings due to production losses. 'In addition, two scheduled maintenance shutdowns have burdened the result by approximately 240 million Swedish kronor,' Lyrå said. 'Given the assessment that these external conditions will persist, we are facing a decisive joint effort going forward and are therefore initiating an action program to strengthen our competitiveness.' In sawn timber, high raw material costs continued to pose a challenge, though seasonal factors and price adjustments in key markets helped restore some balance. While the construction sector remained weak, Södra's cross-laminated timber (CLT) operations were boosted with both sales and production rising during the second quarter. Timber use in construction is on the upswing as well, as reflected in a stronger order outlook heading into the next quarter. Bioproduct sales were hit by declining demand for solid fuels and district heating, along with unexpected disruptions in electricity generation. That said, Södra's biomethanol operations remained steady in both output and demand. Raw material demand also stayed strong, though early signs point to a potential slowdown ahead amid global uncertainty. World-class efficiency—Södra's 'way of working with continuous improvements,' the company said—generated improvements and efficiencies during the quarter with an annual recurring effect of just under $12 million. The total impact since the start in 2021 has been just over $173,000. Against these challenging conditions, Södra rolled out a focused action program to improve profitability and mitigate downside risks. The initiative should tighten priorities across the business and increase emphasis on operational costs, production volumes, and overall efficiency. While driving performance improvements, Södra will maintain its strong focus on workplace health and safety to reduce occupational injuries. The program includes a revved push into digital tools and AI, intended to reinforce Södra's commitment to long-term competitiveness and resilient operations. 'Our competitiveness is always high on the agenda; maintaining it even in challenging times is what underpins our actions moving forward. The action program will take us to a new level of competitiveness,' Lyrå said. 'It will require leadership and courage in day-to-day operations, without losing sight of the horizon. Because our mission stands firm: to refine and renew family forestry. A competitive Södra has a significant role to play in this.' Despite a challenging market environment, Södra plans on moving forward with a series of strategic initiatives aimed at strengthening operations, increasing profitability and supporting long-term growth within the group, which represents over 50,000 family forester members and 3,000 employees around the world. A significant step in Södra's transformation is now underway in Mönsterås, where construction began in May on a state-of-the-art kraft lignin plant. Once completed in 2027, it will be the first commercial facility of its kind in Sweden—and the largest kraft lignin producer in the world. The investment is designed to enhance profitability and support a fossil-free future, creating new value for both the company and forest owners. Södra's CLT business continued to gain ground, per the results. The company recently completed deliveries of 9,100 square meters of CLT for Gothenburg Grand Central, the city's new central station building. The project showcases how sustainable timber construction can lower a building's carbon footprint, Södra said, while storing carbon long-term for a clear contribution to the green transition. Södra will also step up its digital efforts to support forest owners. A new initiative combines deep insights into member needs with AI and automated data, enabling smarter, more tailored forest management. A planning app for forestry advisors will launch this autumn, while an enhanced digital forest management plan is in parallel development as well. To address ongoing economic pressures and better position itself for the future, Södra launched an action program focused on cost control, production efficiency, and volume optimization. The initiative prioritizes profitability, the group said, by maintaining focus on workplace health and safety to reduce occupational injuries. As part of the program, Södra will accelerate investment in digital tools and artificial intelligence to boost long-term competitiveness across its operations. Continued currency exchange rate fluctuations had a 'substantial translation effect that has a direct impact on Södra's earnings, since we do not hedge.' This particularly affected the pulp business, the company said. While beneficial for members, this puts pressure on Södra's production costs, especially for the sawn timber sector. The Södra Skog business area—focused on forestry services, wood raw material and affiliated forest area—saw the period's operating profit reach nearly $725,000—a 7 percent dip YoY. The earnings trend was mainly attributed to lower volumes and increased digital investments. The Södra Wood business area—focused on wood products like sawn timber and CLT as well as production and delivery volumes—saw the operating profit total $310,000 (down nearly 98 percent YoY) for the period. The earnings trend during the quarter was mainly due to significantly higher saw log costs, partly offset by higher delivery prices and some adverse exchange rate effects. The Södra Cell business area—focused on market pulp (such as softwood, hardwood, dissolving), electricity generation and impact of currency fluctuations and maintenance shutdowns—saw an operating loss of $22.9 million (down 41.9 percent YoY) for the period. The change in earnings during the quarter was mainly due to the Swedish krona and U.S. dollar currency trend and scheduled maintenance shutdowns. The Södra Building Systems business area—focused on timber building systems (like CLT), market challenges and increasing share of wood in construction—saw an operating loss of $4.5 million for the period. The earnings trend was primarily attributable to persistently low volumes due to a weak construction market. Operating profit for the Södra Bioproducts—focused on energy products (solid biofuels, electricity, district heating), liquid bioproducts (biomethanol, tall oil) and sales included in other BAs—was included in other business areas, the company said, with the business area's sales for the period amounted to around $43 million. Sign in to access your portfolio
Yahoo
04-07-2025
- Business
- Yahoo
What to Expect From International Paper's Next Quarterly Earnings Report
Valued at a market cap of $26.6 billion, International Paper Company (IP) is a leading global producer of renewable fiber-based packaging and pulp products. Operating through its Industrial Packaging and Global Cellulose Fibers segments, the company serves diverse markets across North America, Latin America, Europe, and North Africa. IP is expected to release its fiscal Q2 2025 results before the market opens on Thursday, Jul. 31. Ahead of this event, analysts project the Memphis, Tennessee-based company to report an adjusted EPS of $0.38, a 30.9% decrease from $0.55 in the year-ago quarter. International Paper surpassed Wall Street's bottom-line estimates in three of the last four quarterly reports while missing on another occasion. UnitedHealth Stock Is One of the Worst-Performing S&P 500 Stocks in 2025. Should You Buy the Dip? AI Isn't Just About Nvidia: 2 Rising Stars in the Artificial Intelligence Race 'It's a Miracle': Nvidia CEO Says Their New Technology Takes 'AI Supercomputing to a Whole New Level' Tired of missing midday reversals? The FREE Barchart Brief newsletter keeps you in the know. Sign up now! For fiscal 2025, analysts forecast the global paper and packaging company to report adjusted EPS of $2.01, up 77.9% from $1.13 in fiscal 2024. Additionally, adjusted EPS is expected to increase 74.1% year-over-year to $3.50 in fiscal 2026. Over the past 52 weeks, shares of IP have risen 15.8%, outperforming the broader S&P 500 Index's ($SPX) 13.4% gain and the Materials Select Sector SPDR Fund's (XLB) 4.1% return over the same time frame. Shares of International Paper fell 4.1% on Apr. 30 after the company reported Q1 2025 adjusted EPS of $0.23 and revenue of $5.9 billion, missing forecasts. The disappointing results were driven by weaker-than-expected demand for corrugated cardboard and fiber packaging in North America and Europe, amid inflationary pressures and concerns about a recession. Analysts' consensus view on International Paper stock is cautiously optimistic, with a "Moderate Buy" rating overall. Among 12 analysts covering the stock, seven suggest a "Strong Buy," one gives a "Moderate Buy," two recommend a "Hold," and two give "Strong Sells." As of writing, IP is trading below the average analyst price target of $56.28. On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on
Yahoo
23-06-2025
- Business
- Yahoo
Goldman Sachs Upgrades Suzano, Sees Undervalued Export Play Amid FX Shift and Sector Repricing
Goldman Sachs (NYSE:GS) upgraded Suzano Papel & Celulose (NYSE:SUZ) from Neutral to Buy on June 13 and raised its price target to R$65 from R$63. The bank's analysts cited a favorable mix of valuation, currency tailwinds, and sector underexposure for the rating. The new target implies a 22.6% upside for the Brazilian pulp producer. The investment bank analysts pointed to an 11% YTD depreciation in the Brazilian real as a key advantage for Suzano, which exports heavily in U.S. dollars. Combined with pulp prices nearing marginal cost levels, Goldman sees the environment tilting back in the company's favor. A mobile crane moving a shipment of bulk pulp & paper product. What sealed the call, however, was valuation. Suzano (NYSE:SUZ) is now trading at a 15–17% free cash flow yield and 5.4–4.6x EV/EBITDA on 2026–2027 estimates, which is well below its 10-year EV/EBITDA average of 6.5x. For Goldman, that disconnect signals room for rerating, especially with the stock down 15% YTD and underperforming Brazil's Bovespa index by 29%. Goldman (NYSE:GS) acknowledged it had taken a cautious stance on Suzano since its coverage since 2021, during what it expected to be a prolonged downcycle in pulp prices. Over that period, Suzano returned just 2%, versus a 19% gain for the Bovespa. The firm now sees that thesis shifting, even as risks like rising Chinese supply remain on the table. Goldman's view seems to have priced in Suzano's headwinds, and what's left is a leaner, undervalued exporter well-positioned to benefit from currency trends and a stabilizing pulp market. SUZ is among the . While we acknowledge the potential of SUZ as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
09-06-2025
- Business
- Bloomberg
An Empire Built on Paper Looks to Benefit From Trump's Trade War
Industries Consumer Suzano's buying spree, including a Kimberly-Clark deal, shows how executives in Latin America's largest economy can work through fraught geopolitics. Its biggest buyer is China. Its biggest prospects are in the US. Its biggest acquisition in nearly a decade is focused on Europe. Brazilian pulp and paper giant Suzano SA is going global as it navigates trade tensions between geopolitical heavyweights. The company harvests raw materials from its eucalyptus groves that go into making everything from books to toilet paper, and claims to play a role in the lives of 2 billion people worldwide. Its executives say they have a plan to navigate this tumultuous time in global commerce, one that could provide a playbook for other companies looking not only to survive but to profit.
Bloomberg
05-06-2025
- Business
- Bloomberg
Kimberly-Clark Nears Global Tissue Business Sale, WSJ Says
Kimberly-Clark Corp. is close to a roughly $3.5 billion sale of its global Kleenex and tissue businesses outside of North America, the Wall Street Journal reported, citing unidentified people familiar with the matter. A deal to sell the segment to Brazilian pulp supplier Suzano SA could be completed as soon as Thursday, the newspaper reported, citing the people.
