Rottneros (RROS) investor relations material

Executive summary

• EBITDA for Q2 2025 showed sequential improvement but remained negative at -15 MSEK, reflecting persistent cost pressures and challenging market conditions, with high production levels maintained.

• Net turnover increased by 2% to 726 MSEK in Q2 2025, driven by higher sales volumes despite lower prices and high raw material costs.

• Net income for Q2 2025 was -158 MSEK, impacted by a 140 MSEK asset impairment due to weak CTMP market.

• Rights issue of approximately 300 MSEK was completed and oversubscribed in July, strengthening the balance sheet and reducing net debt.

• Cost-saving program initiated, targeting annual savings of 35–40 MSEK, with full effect expected in autumn 2025.

Financial highlights

• EBITDA improved sequentially from Q1 2025 but was down from Q2 2024 due to lower prices and high wood costs.

• EBIT and net income for H1 2025 were significantly lower year-over-year, mainly due to price and currency effects and a 140 MSEK asset write-down.

• High variable costs, especially wood, accounted for 76% of pulp production costs in H1 2025.

• Positive operating cash flow in Q2 2025, mainly due to decreased working capital, but H1 2025 cash flow from operations was negative.

• Net turnover for H1 2025 was 1,378 MSEK, down 1% year-over-year; sales volume decreased by 3%.

Outlook and guidance

• Cost adjustments and efficiency improvements are expected to reduce the cost base by 35–40 MSEK annually, with full effect in autumn 2025.

• Raw material costs, especially wood, have peaked and are showing early signs of decline, offering hope for margin recovery.

• Equity/assets ratio after the rights issue is estimated at 64%, above the long-term target of 50%.

• Market remains highly uncertain due to global trade issues, tariffs, overcapacity, and exchange rate volatility.

• Maintenance shutdowns planned for Q3 at Rottneros Mill and Q4 at Vallvik Mill, with estimated income impacts of 10–20 MSEK and 70–80 MSEK, respectively.