UPM-Kymmene (UPM) Q1 2026 earnings summary

Executive summary

• Q1 2026 delivered resilient results with sales of €2,505 million, a 5% year-on-year decline, and comparable EBIT of €274 million (10.9% margin), supported by a diversified business portfolio amid ongoing geopolitical uncertainties.

• Decarbonization solutions, especially in Energy and Biofuels, delivered record or strong results, while advanced materials and renewable fibres showed underlying improvement.

• Announced a demerger plan for the Plywood business and continued preparations for a graphic paper joint venture with Sappi.

• Operating cash flow for Q1 was €89 million, impacted by seasonal and one-off items.

• Net debt at quarter-end was €2,962 million, with a net debt-to-EBITDA ratio of 2.3.

Financial highlights

• Q1 2026 sales were €2,505 million, down 5% year-on-year.

• Comparable EBIT was €274 million (10.9% of sales), down from €287 million (10.8%) in Q1 2025.

• Operating cash flow was €89 million, down from €289 million year-over-year.

• Profit for the period was €200 million, up from €143 million in Q1 2025.

• Investments and CapEx remained low, supporting positive free cash flow.

Outlook and guidance

• H1 2026 comparable EBIT is expected to be €325–525 million (vs. €413 million in H1 2025), with Q2 expected to be weaker due to maintenance shutdowns and seasonal effects.

• Performance to benefit from higher sales prices, delivery volumes, and lower fixed/variable costs, but will be held back by weak communication paper markets and ramp-up costs at Leuna.

• Margin protection is a priority amid higher inflation, global uncertainties, and negative currency effects.

• No significant energy refunds or forest asset revaluations expected in H1 2026.

• Continued focus on competitiveness, performance, and transformative portfolio projects.