Stora Enso (STE) investor relations material

Executive summary

• Q1 2026 sales remained stable at EUR 2.4 billion, with higher deliveries offset by adverse FX impacts and persistent pricing pressure in some segments.

• Adjusted EBIT declined by EUR 16 million year-over-year to EUR 159 million, mainly due to FX and the Oulu ramp-up, despite internal actions and lower wood costs.

• Strategic focus on operational efficiency, cost management, and the ramp-up of the Oulu consumer board line, with decentralized P&L responsibility across business units.

• Preparation for the separation and listing of the Swedish forest assets business (Bergslagens Skogar) is progressing, with completion targeted for H1 2027.

• Strategic review of Central European sawmills and building solutions is ongoing.

Financial highlights

• Sales stable at EUR 2.4 billion; adjusted EBIT at EUR 159 million, margin 6.7%, down from 7.4% year-over-year.

• Net debt at EUR 3.5 billion, net debt to EBITDA at 3.1x; net debt increased after dividend booking.

• CapEx reduced by EUR 100 million year-over-year, with Q1 2026 CapEx at EUR 74 million; target for 2026 set at EUR 550 million or below.

• Cash flow after investing activities improved due to lower CapEx, but operating cash flow was impacted by restructuring, higher working capital, and dividend payables.

• Scope 1 and 2 emissions down 62% from 2019 base year; sustainability targets progressing.

Outlook and guidance

• Margin expansion initiatives of EUR 500–700 million underway, expected to support margins over the next 2–4 years.

• Oulu ramp-up to continue impacting profitability in Q2 2026; full operational performance targeted for 2027.

• Focus remains on operational efficiency, commercial excellence, and disciplined capital allocation, with no major new expansion planned.

• Maintenance CapEx will set the minimum level for future investments; income from emission rights projected to decrease due to EU ETS rule changes.

• No specific guidance on pricing or cost inflation due to market volatility; focus remains on internal efficiency and competitiveness.