Borregaard (BRG) Q2 2026 earnings summary

Executive summary

• Q2 2026 operating revenues rose to NOK 2,114 million, up 3% year-over-year, with EBITDA at NOK 515 million, nearly flat compared to NOK 522 million in Q2 2025, reflecting solid operational performance and resilience across segments.

• Segment results were mixed: BioMaterials and Fine Chemicals improved, while BioSolutions declined due to higher costs and less favorable product mix.

• Significant non-recurring items included a NOK 337 million impairment of the Alginor investment, reducing ownership from 42% to 10%, and a NOK 30 million accrual for ground stabilization at Sarpsborg site.

• Strong cash flow from operations (NOK 695 million), supported by reduced net working capital and robust EBITDA, largely offset dividend payments.

Financial highlights

• EBITDA margin was 24.4%, down from 25.5% year-over-year but up sequentially.

• Adjusted EPS was NOK 2.35 for the quarter (NOK -1.27 unadjusted due to impairment and accruals).

• Net interest-bearing debt increased by NOK 16 million to NOK 2,141 million; equity ratio at 59.0%, leverage ratio at 1.20.

• Cash flow from operating activities was NOK 695 million, up from NOK 385 million in Q2 2025.

• Return on capital employed (ROCE) was 14.4% (down from 17.2%).

Outlook and guidance

• BioSolutions 2026 sales volume forecast revised to 335,000 tonnes; Q3 expected at 85,000 tonnes.

• BioMaterials 2026 sales volume expected to exceed 160,000 tonnes, with higher specialised grades; Q3 at 40,000 tonnes.

• Fine Chemicals expects stable bioethanol prices, higher intermediates volume, but weaker product mix in H2 2026.

• Wood costs expected to decline 3–4% in H2 2026; ongoing global uncertainty impacting energy and chemical costs.

• Cost improvement programme targeting NOK 150 million annual savings by 2028, including hiring freeze and activity reduction.