Stora Enso Aktie

Hello, everyone. My name is Jutta Mikkola. And as the Head of Investor Relations, I'm delighted to welcome you to our first quarter results presentation. With me today is our President and CEO, Hans Sohlstrom; and our CFO, Niclas Rosenlew.

This quarter, our main theme was focus on our own actions drives results. This highlights the decisions and actions we took last year and the momentum we are bringing into this year. Hans will start with key highlights and strategic focus areas. And after that, Niclas will take you through our performance and results. We'll wrap it up with the key main takeaways. Once we are finished, like usual, we will open the floor for your questions.

So thank you once again. And I hope you had a good time with us. With these words, Hans, the stage is yours.

Thank you, Jutta, and hello, everyone. Great to have you with us.

The first quarter of 2026 developed largely as expected. While market conditions remain challenging, we continue to drive performance through our own actions across operations, costs, commercial excellence and procurement. Demand in our main markets stayed at a relatively low level and pricing pressure persisted in some business segments, while prices firmed up and increased in Others.

We delivered resilient results with sales of EUR 2.4 billion and EBIT of EUR 159 million. Operationally, the ramp-up of the new consumer board line at Oulu continued. We focus on improving the technical runability of production. This, in addition to the weak market, impacted profitability during the quarter and is expected to continue into the second quarter. While the ramp-up continues to impact short-term profitability, we remain confident in bringing the line to full operational performance during 2027.

Stora Enso's segment reporting changed as of 1st of January 2026, and the group has restarted the comparative figures for its segment reporting for 2025. This quarter marks the first time we report under our new reporting structure, which reflects how we manage the business and how value is created across the group. A key to value creation is the P&L responsibility across 6 business areas and 23 business units. I am pleased to see that this decentralized P&L responsibility is already having a positive effect through our leaders focusing on continuous profit improvement. This provides a strong foundation for performance culture going forward.

We continue the preparation for the separation of our Swedish Forest Assets business into a new publicly listed company, which is expected to be completed during the first half of 2027. Preparations for the separation of our Swedish Forest Assets business, now named Bergslagets Skogar, formerly Forest Company, continued to progress as planned. We'll discuss this more in detail a bit further in the presentation.

Our strategic priorities remain unchanged. Lead in customer value creation through innovation, quality and sustainability; grow faster than market with superior customer offering, leading technology and operational efficiency; expand margin through business focus, a positive performance culture and systematic value creation; generate cash with high conversion ratio and disciplined capital allocation. We continue to strengthen our competitiveness and ability to deliver consistent performance regardless of external market volatility.

As said, one of our key strategic priorities is to expand margins through business focus, stronger performance culture and a systematic value creation. This has been a core priority throughout last year and continues to be so going forward. We have identified EUR 500 million to EUR 700 million of value creation initiatives, all with clear ownership and already underway, expected to support margin expansion over the next 2 to 4 years. Development in the first quarter have been encouraging.

First quarter underlying profitability improved as a result of our own actions offsetting market headwinds from unfavorable exchange rates as well as a continued pressure on prices and demand. With the wood cost easing, the market headwind can even turn into a tailwind at some point. The Oulu ramp-up continues to weigh on profitability in the short term. But once fully ramped up, it will be a clear contributor. Overall, the fundamentals of our margin expansion story remains firmly intact with increasing contribution from own actions as we move forward.

Next, a couple of words about the progress of the demerger of the Swedish Forest business. We are moving ahead with our plans to demerger the Swedish Forest Assets into a separate listed company with completion anticipated in the first half of 2027. Today, I'm happy to announce the name of the company, Bergslagets Skogar. The new name reflects both the geographic and historic footprint in Sweden's Bergslagen region and a long-term approach to value creation, where planning horizons extend across generations. This company will represent a high-quality Forest asset entity with over 1.2 million hectares of sustainably managed forest land in Sweden and positioned to become Europe's largest listed pure-play forest company.

A few words about the logo. In earlier centuries, timber transported from the forest was marked to indicate ownership and origin. In Bergslagen, that mark was the letter B, which today inspires the new logo. The design reference, the wood structures historically used in the Falun Mine, where timber formed the foundation for safety, stability and continuity, values that continue to guide forest management today. The name and the logo are not the only thing we are announcing today. We will be hosting Bergslagets Skogar's Capital Markets Day on 3rd November 2026 in Stockholm. So please do mark the day into your calendar. That is where the company will provide investors with an overview of Bergslagets Skogar's stand-alone strategy, value creation drivers, capital allocation framework and financial profile.

Then let's move on to the innovation highlights. This time, I have 3 examples related to another strategic priority, lead in customer value creation through innovation, quality and sustainability. The first example is our partnership with Majoral and Zfoam. We co-developed a jewelry package made from Papira. Papira is our trademarked wood-based and fully renewable and recyclable packaging foam. It was awarded in the Paris Packaging Week Innovation Awards for its performance, design and environmental responsibility. This shows that our sustainable fiber solutions are making an impact in premium packaging.

The second example highlights the importance of the strong link between material development and converting expertise, in this case, with Aristo. Aristo is a manufacturer of paperboard boxes and paper bags. Our CKB Nude Aqua, a dispersion coated board solution offers grease resistance and delivers the physical properties converters expect from high-performing board. In addition, it serves as an alternative to plastic materials.

The third case highlights our progress in emission reduction, particularly at our Imatra mills, where we have significantly reduced greenhouse gas emissions. More broadly, reducing CO2 is a priority across all our mills with Imatra as a strong example. In the first quarter, total group Scope 1 and 2 emissions were down by 62% compared to the 2019 base year, reflecting continued improvements in energy efficiency and lower operational emissions. At Imatra, this has translated into a reduction of more than 100,000 tonnes of CO2.

Taken together, these cases demonstrate how innovation, quality and sustainability come together in our offering, supporting customer value creation and strengthening our position in sustainable packaging. It is about combining material innovation with application expertise, while at the same time, reducing our environment footprint.

With that, I will conclude this section and hand over to you, Niclas, to take you through the financials.

Thank you, Hans, and hello, everyone. Let's now take a look at the financial overview for the first quarter.

During the first quarter, as Hans already mentioned, our own actions have been driving the performance. Sales was stable at EUR 2.4 billion and would have increased excluding the negative FX effect. Deliveries were higher in all segments other than Biomaterials, where the Veracel site had planned maintenance during the first quarter. Adjusted EBIT for the first quarter was EUR 159 million. Comparing year-on-year and excluding the impact from the Oulu ramp-up, the underlying profitability improved, reflecting a stable underlying performance despite market headwinds. This we can clearly see when looking more closely at the EBIT bridge for Q1.

So looking at the big picture, adjusted EBIT declined by EUR 16 million compared to last year, with the primary reason being the ramp-up of the new line in Oulu. The old ramp-up had a negative impact of EUR 29 million on our EBIT for the first quarter. Last year, the ramp-up only started at the end of the first quarter. Nevertheless, our underlying performance has strengthened, thanks to our disciplined strategy execution and the focus on own actions. This progress is particularly evident in the improvements we made to both variable and fixed costs. On the fixed cost side, we saw gains even with planned maintenance at the Veracel site, which we didn't have last year at this time.

Looking at the market movements, lower wood costs improved profitability, but negative FX effects and some price and mix changes more than offset those positive contributions. The net FX had a dual hit on us this time. Weaker dollar reduced our sales, while then the stronger Swedish krona pushed our costs up.

Let's then turn the focus on to cash flow, which is another important strategic priority for us. In the quarter, we spent EUR 100 million less on CapEx compared to last year. This is fully aligned with our plan to reduce CapEx as we are well invested and have competitive assets. While the underlying cash flow continues to improve, in the first quarter, it was impacted by restructuring-related one-off items and slightly higher working capital. Specifically, we closed a Packaging Solutions site in China and had other restructuring-related payments as well as related to our cost reduction actions.

Also, changes in working capital had a somewhat more negative impact compared to Q1 '25. This was mainly due to higher receivables related to the relatively strong Consumer Packaging sales. Q1 is typically the quarter where we tie up a bit more working capital. So in sum, CapEx came down, but restructuring actions and working capital movements impacted cash flow in Q1 negatively. However, from an underlying cash flow perspective, the positive trend has continued.

If we then move on to the balance sheet and net debt. Net debt was about EUR 3.5 billion, a clear decrease from last year's EUR 4 billion levels. However, it did increase from last quarter, and this was mainly driven by the full year dividend booking, which is around EUR 200 million as well as lower cash flow. Net debt-to-EBITDA was 3.1x.

On this note, I want to say a few words about the EUR 1 billion hybrid that we successfully issued in April this year. It is a good instrument for us optimizing our balance sheet. It is treated as equity under IFRS and partly by the rating agencies. So it supports credit metrics, protects our investment-grade profile and ensures resilience in a volatile world. We are pleased with the interest the hybrid attracted. The hybrid further strengthens our capital structure, enhances our financial flexibility and supports the long-term strategy and the steps ahead related to our Swedish Forest demerger. As Hans said, this is the first time we report based on the new segment structure. Compared to the previous reporting structure, this better reflects our portfolio and focus, how we manage the business as well as how value is created across the group.

Let's start with Consumer Packaging. We started the year reasonably well with improving sales. This was mainly due to higher deliveries of food and liquid products and structural changes, meaning the ramp-up of Oulu and the Junnikkala acquisition. While order inflow improved, especially in Food and Liquid, demand for European consumer board grades remained mixed. Adjusted EBIT increased by EUR 10 million. The underlying profitability improved as we made good progress with own actions, lowering the variable and the fixed costs. Also, lower wood costs supported profitability improvements. This was partly offset by the adverse impact of the ramp-up of the new line in Oulu, pushing the first quarter results down by EUR 29 million.

In Integrated Packaging, sales decreased slightly, but profitability improved. The sales decline was mainly due to negative impact from FX. Volumes on the other hand, improved. Adjusted EBIT increased by EUR 6 million as lower variable costs were partly offset by lower prices and negative FX. Demand for containerboard and corrugated board remained stable.

Also in Biomaterials, the main reason for lower sales was the negative FX, mainly the weaker dollar, but also the deliveries were somewhat lower. This was because we carried out planned maintenance at the Veracel site during the first quarter, and we did not have the Veracel maintenance in the comparable quarter last year. Adjusted EBIT decreased by EUR 20 million as lower sales were only partly offset by lower variable costs. The softwood market remained weak, but for Asian hardwood, prices recovered slightly sequentially.

Then commenting on the Other segment. This is where we have the Swedish Forest Assets where we prepare for the demerger as well as the Central European Wood Products operations where we have the strategic review ongoing. In addition, the Other segment includes the growth business unit, the wood and energy business area and group functions. Segment Other sales, mainly sales of wood and Wood Products remained stable. The intercompany sales of wood and logistics services from segment Other to Industrial segments have been eliminated and do not show any more in these segment numbers. Adjusted EBIT decreased by EUR 10 million, and this was mainly due to higher wood costs in Central European Wood Products operations.

With that said, I will hand back to you, Hans, for concluding remarks.

So thank you, Niclas. As said, the first quarter of 2026 developed largely as expected with stable performance. While market conditions remain challenging, we continue to drive performance through our own actions across operations, costs, commercial excellence and procurement. Our strategic priorities remain unchanged. We will lead in customer value creation through innovation, quality and sustainability. We will grow faster than market with superior customer offering, leading technology and operational efficiency. We will expand margins through business focus, a positive performance culture and systematic value creation. And we will generate cash with high conversion ratio and disciplined capital allocation.

I would like to thank our employees for their strong contribution at the start of the year. Also, I would like to thank our customers, partners and shareholders for your continued trust. Together, we are building a stronger, more focused and more sustainable Stora Enso.

Thank you for listening, and we are now ready to take your questions.

[Operator Instructions] Our first question comes from Cole Hathorn with Jefferies.

I've got a few on my side. I'd just like to start with Consumer Packaging and your own internal actions there. I mean the Consumer Packaging division did very well. And I'm just wondering if there's any color you can break out between how much of the performance was from lower wood costs? How much was it from your own internal actions? And any guidance you can give for the benefit of those internal actions through 2026? I'm just trying to break down how much is just market relief versus your delivery.

Yes. Thank you very much, Cole. Well, first of all, sequentially, our volumes improved. And so in that respect, that was what was partly a contributor. But the main part of all the improvement really comes from our own actions, the value creation programs, the thousands of programs, which is a culture in our company where we continuously improve and drive performance in every mill, every operation and also every business area. So our performance is mainly driven by our own actions.

And maybe, Cole, to add, I mean, on the '26 and so on, we don't provide an exact number. But of course, going back to kind of -- the CMD, we had this EUR 500 million to EUR 700 million target over the next 2 to 4 years. As Hans said, that's kind of we work across all businesses, all functions, everything on these thousands of initiatives any one day. And of course, we push it as hard as possible, but think about it as a relatively even distribution over that period of time. That's at least how we push it.

So it's right to think that those internal actions as well as some, hopefully, market wood cost relief should continue to benefit through the rest of the year?

Well, the own actions, those we are pushing throughout the year. So that's a continuum. Of course, then when it comes to other kind of market drivers, be it wood costs or sales prices or whatever, that's then a different factor. But the own actions will continue to push across the year.

Well, then maybe just my follow-up is on wood cost relief and how you're managing the cost inflation in kind of energy and logistics. Just any color of commercially, are you doing any surcharges to offset higher logistics costs on liquid packaging board and then wood cost relief through 2026, how are you thinking about it?

Yes, Cole, we are, of course, working also on pricing. And even if -- when it comes to energy, we are, to a large extent, self-sufficient in energy, 75% self-sufficient. Oil and gas represents only 3% of our total fuels, but we have impacts from the war in Iran and Hormuz Strait's closure through increased logistic costs as well as also some chemical costs. And of course, we do whatever we can also to improve our pricing.

Our next question comes from Linus Larsson with SEB.

It's an ever-changing world that we're living in. And given the geopolitics, I'd be very curious to hear your thoughts on -- or your observations from the real world, what you are seeing. So it seems like tensions escalated towards the end of the first quarter. What are you seeing in terms of client activity, order books, et cetera, now at the beginning of -- in the early parts of the second quarter? Any color on that would be super interesting.

Thank you, Linus, for your question. The demand for Stora Enso's products is mainly driven by private consumption. So about 2/3 of Stora Enso's top line really relies on private consumption. And consumers' confidence is now with the increased geopolitical uncertainty and the war is, of course, on a low level. And of course, that impacts also the demand for our products. And it only underlines the fact that we need to continue to do what we have been doing in the last couple of years, focusing on our customers, serving them better than ever before, continuing driving costs out, improving competitiveness, performance.

And I'm truly proud of the work that is being performed every day by all Stora Enso employees in every business area, every business unit, every mill and operations across the world. I think we're doing a fantastic job, and I'm so happy to see that we have really embedded this culture, performance culture of continuous improvement. And I think we have only seen the beginning of what we can perform here in terms of improved competitiveness.

Yes. And then just to add to what Hans said or what's -- reiterating what Hans said earlier, on the cost side, we do see an impact -- a negative impact by higher costs and that's mainly from logistics and chemicals where we see it. And that came pretty quickly actually after the conflict started.

Right. That's helpful. And maybe dialing back a bit to the previous question and a follow-up on what you just said, Niclas. I mean, the variable cost side, what's the net of things in the second quarter? Would you say -- I presume you have still a tailwind from fiber costs, Q2 versus Q1. How significant is that? And is that bigger or smaller than the headwind that you are talking about in terms of logistics and chemicals?

Yes. It's, of course, a bit tricky to kind of give an exact number because, as you said in the beginning, the world is a pretty dynamic place and every day is kind of a new reality. And again, that's why, as Hans said, that's why we are really focusing on managing our own actions. And I mean, we expect to see higher cost chemicals, transportation, which we then work on offsetting. And then you're right, then we'll have some tailwind from wood costs. And then as you saw now in Q1, a big headwind from FX. So exactly where those will land is, of course, a bit premature. I don't want to say, but it's going to be a mix of those things.

Sorry, just finally, the FX side, is that a headwind still Q2 on Q1 given today's exchange rates?

Well, I was saying it's -- as you saw, it was a significant headwind in Q1. Again, how it will fall out in Q2 depends on the rates, and we can all check the kind of today's rates, but also how they then develop over the quarter. So it was not a comment on Q2 specifically, but rather on Q1.

Our next question comes from Ioannis Masvoulas with Morgan Stanley.

My video is off, but I'll just focus on 2 questions from my side. First, on Consumer Packaging, a key aspect of the CMD last year was your focus on taking market share versus recycled grades. In today's environment where recycled-based packaging products are probably facing greater energy cost pressures, are you seeing that potential share gains accelerating? Or is it still too early to tell?

Well, Ioannis, you are right that the higher costs of fossil energy, oil, gas, natural gas, basically improves our relative competitiveness because we are self-sufficient in energy. But of course, we have logistic costs, which are moving up. So -- but that's -- I think the rest remains to be seen.

Okay. And maybe just on the ramp-up costs, which they are running above the original target, which you have set at about EUR 100 million. I think you're guiding Q2 similar to Q1, so around EUR 30 million incremental impact. How should we think about the overall ramp-up costs? And when do you actually expect this to no longer be a drag to earnings for the segment?

So basically, what has happened in the first quarter is that from a technical perspective, from productivity production, we have clearly improved, and we are on a good level according to plan. But of course, with the subdued demand, which is due to the geopolitical uncertainty, the low consumer confidence, it also means, of course, that we are not running full. So we are taking also some market-related downtime, and that then also has an impact then on the profit generation of this new production line.

So just a quick follow-up to clarify here because I would think that Oulu is the most cost competitive mill that you have, at least once it runs fully, if you need to take some market-related downtime, would it not make sense to do so in some of the other higher cost mills in the footprint?

Ioannis, you are absolutely right. But on the other hand, it's also a question of getting your products qualified. Normally, it's a long process of several months per customer. So as the production volumes are increasing rapidly, there is a certain also time lag for sales to pick up through the quality verification and qualification processes, which takes several months as such.

Our next question comes from Gabriel Simoes with Goldman Sachs.

So the first one would be on the restructuring expenses. So this quarter, we had lower-than-expected cash generation here despite the stronger adjusted EBITDA. And I understand that a portion of that is because of the change in reporting and the spin-off of the forestry business, a portion of that, the higher restructuring expenses. And I just wanted to understand until when we should see higher expenses in that front?

And the second question would be on the Consumer Board side. So I just wanted to understand how you're seeing competition in this market and what impacts you have seen in terms of competition since the beginning of the Middle East conflict. So I wanted to understand if competition with Chinese products has increased because of how hard it has been to get products to the Middle East or has decreased given the higher transportation costs. So just wanted to understand your -- like how you balance that.

So Gabriel, good to hear you. On the restructuring charges, you're absolutely right that they were higher than usual. And the single biggest element in the restructuring charges were actually our closure of a site in China. So it was a Packaging Solutions site in China, where we actually consolidated or we closed down the whole site, and we took on the production in other sites that we have in China. And that was twofold of the cost kind of from this closure.

One was the restructuring, so essentially employee-related cost and the other element was then a write-down of assets in that site. So that was by far the single biggest thing now in Q1. Then we had a couple kind of a continuation, again, back to all the actions we drive the value creation actions, there was an element of that. And then you are right, there was an element, although a smaller one related to the Swedish Forest demerger. So that was kind of in a nutshell.

And if I continue then, Gabriel, on the Chinese competition. So basically, with higher logistic costs, with higher costs of fossil energy, that basically improves our competitiveness in our domestic market in Europe because, of course, the Chinese competitors, they very much rely on oil, gas, fossil energy as their primary source of energy. And then, of course, they have significant and higher logistic costs to our domestic market, Europe than what we have.

All right. If I could just ask a quick follow-up on the first question. Just trying to understand, given that the majority of the restructuring expenses this quarter came because of the shutdown of this plant in China. Just wanted to understand like how we should see these expenses coming throughout the year, given that a portion of it should still be for the spin-off?

Yes. So the China one was a one-off. Of course, we don't rule out similar measures in the future. And then what comes to the value creation, we do take constant action now. So there will likely be some in the future as well. And then exactly, as you say, we are moving forward with the preparation of the demerger. So there will be some there as well. But I would -- we can't give you an exact number, but out of the total IAC, the spin-off related was single-digit type of cost.

Our next question comes from Reinhardt van der Walt with Bank of America.

Congratulations on the results. I just wanted to follow up on one of your answers to the previous questions around the import dynamics in Europe. Are you seeing any change in customer thinking around security of supply at this point given all of -- given the geopolitical issues and the conflict?

Thank you, Reinhardt. Well, it's perhaps a little bit premature to draw some really fundamental conclusions. But clearly, in a world of -- in a very volatile world, security of supply is important. I mean we saw that throughout COVID 2020. And yes, also in this very volatile world, long-term customer relationship, partnerships, security of supply is key.

Right. Got it. But you're not seeing explicitly customers talking about it or sort of changing their behavior yet, but it's kind of just a natural conclusion that at some point, it will become more salient.

I think too early to draw some really fundamental conclusions, but it is important. And of course, customers -- in customer meetings, they raise this topic.

Got it. Understood. And maybe just my second question on prices. So FBB index seems like it's just ticked up a little bit. How are you seeing pricing in your business? Are you seeing that same kind of translation in prices? And if at all possible, can you give us a sense of how much of that price increase you think is cost push versus market balance related?

Reinhardt, we are following the same public statistics as you are doing and basically also that public pricing information and public price statistics is reflected also in our businesses across the board.

Our next question comes from Martin Melbye with ABG.

A question on maintenance. I think on Page 18 of your report, you have a good setup showing maintenance by quarter, but you don't give the full year. Historically, you spent like EUR 500 million per year on maintenance. Last year, it was only EUR 390 million. Is this year -- the EUR 390 million and is the EUR 390 million the new normal?

So if we zoom out a bit and talk about the full kind of CapEx, of which maintenance, of course, is a part or significant part even. As you know, we have deliberately and for a reason, good reason, said that we are going to take down CapEx and EUR 550 million or below is the target for this year. Of course, that very much relates to kind of the so-called strategic CapEx, i.e., we do not see a need to kind of expand or do any major new CapEx initiatives because we have what we need essentially. But of course, we are looking at maintenance as well, and it's part of the kind of normal efficiencies. We can maybe take it offline. I don't have an exact kind of number now for the full year in mind for maintenance specifically. But yes, we continue to work on that as well.

And Martin, if I can continue on your question there. I mean, we have -- in the CMD in November of last year, we have launched our 4 strategic priorities, lead in customer value, grow faster than the market, expand margins and fourth, generate cash. And as you know, we have also guided for significantly lower capital expenditure this year compared to earlier years. And in general, as we also explained in our CMD, our asset base is well invested. We have strong, modern asset base, actually the best in our industry. And now we have a strong focus on cash generation.

Okay. And this question has been asked many times now, but you haven't really answered fully the way maybe we want you to. On the logistical cost and the chemical cost, is it possible to give a number in Q2 or for the year?

We don't give any guidance there. But logistic costs and related chemical costs are higher because of higher oil and gas prices. But as I said, we are, to a large extent, self-sufficient in, energy, and we're using bioenergy. So we are less impacted than many of our competitors.

And the reason, Martin, not to give a number, it's not like we don't have scenarios internally. Of course, we have and anyone can calculate the scenarios. But as we all know, it's a moving target. So today, the scenario might look a bit different from yesterday and so on. So that's why it's more through a kind of a scenario thinking that we then plan our actions.

Our next question comes from Andrew Jones with UBS.

I've got a couple. Just firstly, on Oulu, I don't see any EBIT number for that or a specific volume number in the release. I mean, in 4Q, you said it was sort of minus EUR 31 million on EBIT. Do you have a number you can give us on the profitability of Oulu and maybe a utilization that was running out? That's the first question. I'll follow up with another one.

So the number for Q1 was EUR 29 million. And then there as a bit of an exception to everything else where we don't -- where we say that we don't give guidance, but specifically then for Q2, we've said similar levels, but EUR 29 million was the number.

And I want to point out, Andrew, that as I mentioned before, I mean, if you dissect the EUR 29 million compared to the EUR 31 million in the fourth quarter, it's very different. I mean from a productivity, from a performance perspective, we are in a clearly better level again according to our ambition level. But of course, the whole market and demand pricing, all of that then also has an impact.

Sure. And the utilization in 1Q? And maybe now?

Not disclosing that.

Okay. And then just on the progression of prices as we go into 2Q and into 3Q. I mean there's different lags in the business. And I guess the index went up on consumer board by EUR 30 or so on FBB. Obviously, containerboard, we've seen larger price increases, kraftliner up EUR 30, then testliner up EUR 100. How should we see that translating into your business into the second quarter and third quarter given the sort of lags and the sort of translation of box pricing? How should we think about that sort of price cost spread as we move through the next couple of quarters?

Thank you, Andrew. Of course, your question is very, very relevant. But the only thing I will say is that we are following the same statistics as you are following, and we don't really give any guidance on pricing.

next question comes from Detlef Winckelmann with JPMorgan.

Just one question from me, please. We've just gone through U.S. results. I think they're all talking about less consumer board coming from Europe into America. At the same time, you're now talking about Europe becoming more competitive versus Asia. So clearly, there's a lot of things on the go right now. I'm just curious, if things stay as they are, which is a big if, I agree, does that tighten your overall market? I want to just kind of get your thoughts on the puts and takes there. Are we moving a little bit tighter, a bit looser with all these things going on at the moment or unchanged?

Well, thank you for the question, Detlef. First of all, I mean, we -- the whole -- as a part of the business case for Oulu was also significant sales to the U.S. and we are following that plan. I mean, of course, with the import tariffs, the profitability of our business in the U.S. as well as also, by the way, the weakening of the U.S. dollar. Go 1 year back, the U.S. dollar was about 15% stronger against the euro as today.

So of course, the tariffs and the weaker U.S. dollar has an impact on the profitability of our sales to the U.S. But also with the tariffs and the currency exchange rates, we can make money in the U.S. And we are there in the long term. So we are establishing and growing sales also to the U.S. But of course, Europe is our main market, and that's where the main part of our cartonboard volumes are going.

Maybe if I can just follow up on that. I mean, I fully understand over the last year or so, we've seen FX fluctuations, tariffs, et cetera. But I think a lot of the consumer board commentary out of the U.S. has been pertaining to the last, call it, 2, 3 months ever since the Middle East crisis has taken off. You yourself referred to Europe becoming a bit more competitive relative to Asia because of energy prices in Asia going up by a bit more. So my question is more around the shorter term, how this Middle East crisis has shuffled or shifted supply chains and kind of balances in Europe and if it's changed at all?

Well, I think it's a little bit early to draw any profound conclusions here. But when I was referring to competitiveness, cost competitiveness, I was mainly referring to our company, which is, to a large extent, self-sufficient in energy. But of course, logistic plays a role here. And of course, it's better to be local in Europe than having long and expensive logistic chains.

Our next question comes from Joni Sandvall with Nordea.

A couple of questions from my side. Maybe starting with sales. Have you actually -- because in anticipation of, let's say, higher prices, have you seen any prebuying in the market during Q1 or early Q2?

Well, thank you, Joni, for the question. It's really hard to say where the volumes and the demand goes. Does it go to stock or does it go to consumption? Of course, we have our models. We have our generative AI models that are quite good and which we use as a prediction for demand. And the more we use them, the more accurate they become. So I think that I cannot really say that there would be any major stock building happening as we speak. But on the other hand, we cannot be sure either.

Okay. Okay. And second question, still on the variable costs, maybe going a different way. So if assuming you have seen the energy-related and oil-related costs go up, when do you expect these to be fully visible in your P&L? Because I think in Q2, still chemical costs, for example, are not fully visible still.

It, of course, depends on what we are sourcing. I think on the logistics side, in general, I mean, there's not one rule that cuts across everything. There's the cost increase comes through quicker, while then in some chemical grades, there might be a bit of a lag. There's some of these or quite a few of these where we've seen the cost go quite a lot up are kind of index based. So therefore, it's relatively quick that the costs go up. And then it very much depends, of course, on the oil price fluctuation, how that develops over the quarter. But I would say, in general, assume a relatively quick kind of throughput on the cost side on these things.

Our next question comes from Cole Hathorn with Jefferies.

Just following up on the Other division. Just considering we've got the Forest as well as the Central Eastern European Wood divisions. I'm just wondering quarter-on-quarter, are there any moving parts that you can call out? And then on Biomaterials, deliveries were a lot lower because of the maintenance. Should we think about 2Q benefiting from higher delivery volumes as well as higher pricing? So any kind of quarter-on-quarter improvement in earnings just so that we can think about the moving parts into the next quarter?

Cole, did you mean specifically for Forest and Central European Wood Products or in general?

Specifically for the Other division, for Forest and Central Eastern European Wood Products, so for the Swedish Forest and Central Eastern European Wood Products.

I mean if -- starting with the Central European Wood Products, you are right there. We have this kind of building construction market seasonality where typically Q2 is a bit of a high season, buying ahead of building or construction then during the summer. What we've seen there, I mean, in Q1 results, which we highlighted as well is that the wood prices in Central Europe are high. There's a lack of supply and that actually hit our results in Q1. And who knows how it evolves, but that's the situation for the moment, at least. On the Swedish Forest side, it's been, I would say, in general, relatively stable, no drama.

And then it was just on the pulp side, anything we should, in particular, think about for the second quarter? Am I right, just assuming better volumes and better price?

We have in our quarterly report, we have also outlined the maintenance schedules or the annual maintenance schedules throughout the whole year. So I think that forms a good basis for your estimates about how these annual maintenance shuts might have some impact on our results development.

Hans, then I think the development of your internal actions and efficiency program is exceptionally positive. You've beaten expectations for the quarter and you deserve credit for the actions that you're taking. But I know, I realize, it's an uncertain market, but without kind of some handholding to the market of what you're going to deliver for internal actions for 2026 or some of the support on that, it's difficult for us to come out and really upgrade expectations.

So I'm just wondering if as we go through the year, we could start kind of refining your expectations for 2026, hopefully, as the market improves. And on the back of that, are there any greater actions that you're going to take around capacity rationalization to really get the supply and demand more balanced within Europe? So what can you provide us on kind of guidance for the full year on savings? And how are you thinking about capacity rationalization actions?

On the first one, I mean, if Hans, you take the bigger topic. But I mean, we are -- we've taken -- made a deliberate decision already earlier that we are not announcing EUR 100 million or EUR 500 million or billions or billions or whatever program per se and then these kind of follow each other. But we've taken a more strategic longer-term view on our own actions and said that this is how we work. This is our culture. This is also part of the P&L responsibility across 23 BUs and 6 BAs. We track it methodically internally. We have one tool covering everything we do in the company. At any 1 day, there's approximately 2,300 actions, which we monitor and we track.

And then going back to the CMD, we said that what we foresee and actually have identified the actions for the next 2 to 4 years is between EUR 500 million and EUR 700 million. And we gave ourselves a bit of leeway 2 to 4 years because it is a dynamic world. But anyway, I think that's a good guide to -- for kind of if you want to split it up into years, for instance. I mean, take that as a basis because that's how we do it ourselves as well. And then the other thing is that we'd much rather -- even if I understand the desire to kind of look into the future with exact figures, but we'd much rather show through our own actions. And so bear with us, but this is a very important thing that we continue to push day in, day out, and it's more and more becoming part of the culture of Stora Enso as well that we drive towards this EUR 500 million to EUR 700 million.

And Cole, as we said in the CMD, our strategic priorities is to lead in customer value to grow faster than the market, over 4% top line growth and to expand our margins to about 10% EBIT margin level, excluding the Forest -- Swedish Forest Assets as well as also to generate cash in order to get our net debt to EBITDA below 1. And we are fully committed to this. We have a very tangible plan to achieve this, and we are working towards this with speed and determination.

Running out of time. So maybe the...

Yes. Well, thank you very much for participating. And all in all, I think and hope it has become clear to all of you since a couple of years back that we are doing whatever it takes to maximize shareholder value. That's our ultimate job. That's our ultimate target, and we do it through improving profit generation in this company, cash flow, and we are doing it by structural means. And there, Bergslagets Skogar is a good example, and we hope to see you in the CMD on the 3rd of November. Thank you very much, and have a good day.

Hello, everyone, and welcome to Stora Enso's Q4 and Full Year Results Presentation. I'm Jutta Mikkola, Head of Investor Relations, and I'm delighted to be joined here today with our President and CEO, Hans Sohlstrom; and our CFO, Niclas Rosenlew.

We're kicking off the webcast with our clear theme, sharpened strategic focus. It reflects the work we've done throughout 2025 and the momentum we are carrying into 2026.

Today, we'll start with Hans, who will walk you through the key highlights and our strategic priorities. After that, Niclas will take you through our financial performance and we'll close with the main takeaways and what's ahead of us in 2026. Once we've covered everything, as usual, we'll open the floor for your questions.

Thank you for joining us. Great to have you with us. Over to you, Hans.

Thank you, Jutta, and hello, everyone. Great to have you with us. 2025 was a pivotal year for Stora Enso, marked by decisive actions to sharpen our strategic focus and unlock long-term value for our shareholders.

In Q4, we completed the strategic review of our Swedish forest assets, a major milestone and begun the separation to form 2 strong companies, a leading renewable materials company with a sharpened focus on packaging and Europe's largest listed pure-play forest company.

We also launched a strategic review of our Central European sawmills and building solutions operations to further focus our portfolio.

Despite a challenging environment during 2025, we delivered resilient results with a sales of EUR 9.3 billion and EBIT of EUR 528 million. We continued ramping up the Oulu consumer board line, a key part of our renewable packaging strategy throughout 2025.

This weighted on our earnings by EUR 140 million in total during the year, but strengthens our long-term position and competitiveness. Excluding Oulu, the underlying profitability improved across all business areas with Biomaterials the exception due to lower pulp prices.

Our net debt to adjusted EBITDA improved to 2.8x, supported by the divestment of approximately 175,000 hectares of Swedish forest land at a value of EUR 900 million and by our ongoing focus on cash flow and cost competitiveness.

The Board of Directors will propose a dividend of EUR 0.25 per share at the Annual General Meeting on the 24th of March 2026. Finally, we hosted a successful Capital Markets Day, where we introduced our new financial targets, strategic priorities and a clear road map for the coming years topics I'll return to shortly.

But before that, let's review how we did with our sustainability progress. During 2025, we had strong progress on our sustainability targets. By the end of 2025, we have reduced Scope 1 and 2 emissions by 61% from 2019 base year, well surpassing our 2030 targets to reduce emissions by 50%.

I'm also proud to say that Stora Enso once again has been included on CDP's Climate Change A list, highlighting our strong transparency and performance in climate actions. This recognition affirms our dedication to sustainable growth through emission reduction, renewable material innovation and advancing the circular bioeconomy.

Additionally, in partnership with IUCN, the International Union for Conservation of Nature, we completed a pioneering project that offers the forest sector a science-based framework for achieving net-positive biodiversity impact. This collaboration helps forestry operations focus on the most effective actions to reduce species extinction risks while maintaining long-term economic value.

But now let's look at the new financial targets and strategic priorities that we have set for the next years. Our strategic priorities as set forth in our Capital Market Day are clear.

We want to lead in customer value creation, grow our business, expand our margins and generate strong cash flow over the cycle. We will achieve this through our continued actions in sourcing, operational efficiency, commercial excellence, working capital and fixed cost, all underpinned by a disciplined approach to capital allocation.

Customer centricity is now at the forefront of our strategy. It drives us to push innovation, quality and sustainability across everything we do. With superior customer offering and the use of advanced technologies, we are raising the bar and setting new industry standards.

So how will this show in our performance over the cycle? First, annual revenue growth of about 4% per annum. We have a strong track record of over 5% during the last decade for our renewable packaging business. We are well invested for the next wave and we will continue to lead in innovation, quality, sustainability and operational efficiency.

Second, we are implementing our plan with speed and determination to reach about 10% EBIT margin. And importantly, this is fully in our own hands. We are putting profit and loss responsibility in place across 6 business areas and 23 P&L responsible business units, enabling determined execution of value creation actions and a strengthened focus on the core business.

Third, we will distribute 50% of our net profit as dividends. Fourth, we will take our net debt per EBITDA to below 1x through disciplined capital allocation and a continued focus on cash flow.

Finally, we introduced a new reporting structure. Our packaging businesses will be regrouped into Consumer Packaging and Integrated Packaging alongside Biomaterials and other as reporting segments. These new segments will be applied starting in Q1 2026.

As just mentioned, one of our key strategic priorities is to expand margins through business focus, a strong performance culture and systematic value creation. The last 2 years show this is working.

Despite headwinds from low consumer confidence and significantly higher wood costs, about EUR 900 million annual headwind compared to the year 2021, our sales have grown and our underlying profitability has improved.

This progress comes from our own actions that have more than offset the market headwinds during these years and the work continues.

In addition to the completed value creation programs, achieving about EUR 900 million profit impact during the years 2024 and 2025, we have identified additional EUR 500 million to EUR 700 million of profit improvement initiatives, all with clear owners and being worked on as we speak.

At the same time, the Oulu ramp up continues and weighs profitability short-term. Once at full capacity, it will add around EUR 800 million in sales and support higher margins. With these levers, we are on a clear path towards reaching about 10% EBIT margin, excluding Swedish forests within 2 to 4 years regardless of market conditions.

The message is clear. Margin expansion will come from our own focus, our performance culture and disciplined execution. We are taking determined actions to build a better company and our own future.

Let's talk about our recent innovation highlights. We grew our portfolio of premium Packaging Materials with the launch of Ensovelvet, a new uncoated solid bleached sulfide board with velvet-like smoothness on both sides.

It is developed for luxury applications such as cosmetics, perfumes and other premium consumer goods where touch and appearance are important. It also ensures excellent printability.

Ensovelvet is, of course, recyclable, supporting the shift towards circular packaging solutions. The absence of coating also means fewer materials are needed in production, resulting in a reduced carbon footprint while maintaining the premium performance expected from premium Packaging Materials.

Stora Enso's CLT solutions enabled the construction of the world's first large-scale timber data center in Falun, Sweden, and the site is now expanding with 2 new data centers. Using mass timber drastically cuts embedded carbon and accelerates construction time.

The developer, Eco Data Center is aiming to be one of the world's most sustainable data centers. By using mass timber supplied by Stora Enso, the company has created a scalable blueprint for a new type of sustainable infrastructure.

World Packaging Organization awarded Stora Enso in 3 categories: e-commerce, food and other for sustainable and innovative design.

Niclas, let's take a look at the financials.

Thank you, Hans. So let's begin with group sales development and EBIT for 2025 as well as then for the fourth quarter. Group sales increased to EUR 9.3 billion in 2025.

This was partially supported by structural changes, most notably the Junnikkala acquisition and the Oulu ramp-up. In Q4, sales declined and this was due to slightly lower board prices and significantly lower pulp prices.

Adjusted EBIT for the full year decreased. However, if we exclude the old ramp-up, actually, the profitability improved across nearly all business areas. The exception was Biomaterials, where significantly lower pulp prices weighted on performance.

And in Q4, the reasons for the EBIT decline are pretty much the same. Underlying businesses were developing quite nicely, considering the tough market and the old ramp-up was the main reason for the lower EBIT. In general, market headwinds such as lower pulp prices were offset by value creation actions.

Looking at the EBIT development for the full year. The impact of our value creation actions is clearly visible. Even with the significant decline in pulp prices, our price and mix improved by more than EUR 100 million, while volumes remained stable.

As Hans mentioned earlier, we continue to face a sizable headwind from fiber costs close to EUR 300 million this year. Despite these headwinds, our ongoing cost and value creation actions had a good positive effect.

Other variable costs and fixed costs declined by more than EUR 200 million, supported by a leaner and more business-focused organizational structure. These actions have strengthened our ability to navigate market volatility and deliver a more resilient performance.

The main drag on earnings for the year came from Oulu or the ramp-up of Oulu, which had a negative impact on EBIT of roughly EUR 140 million, again for the full year. While Oulu weighs on short-term profitability, we do remain confident in the long-term value and industry-leading quality this investment will bring once the line reaches its full potential in 2027.

If we then move on to cash flow, despite the challenging market environment, we managed to safeguard profitability and improve cash generation. Cash flow after investing activities continued to be positive as expected following the gradual completion of the investment phase in Oulu.

As we now become more disciplined with our capital allocation, combined with ending the heavy investment phase, we expect cash flow after investments continue to improve.

So on that note, let's take a look at the net debt. Net debt decreased by almost EUR 800 million in the third quarter, driven by the Swedish forest asset divestment and remained stable in the fourth quarter. Our net debt to adjusted EBITDA ratio is now 2.8x.

Operating working capital remained -- also remained stable at 7% of sales and we intend to maintain it at these lower levels and reduce it further whenever possible.

So let's take a look at our segment performance. Starting with Packaging Materials. During the quarter, we conducted maintenance in some of our main sites. In addition, we continue to ramp up the new Oulu board machine.

Despite this, profitability was preserved, thanks to good value creation activities and strong customer offers. Sales decreased driven by slightly lower consumer board prices and adverse currency effect from a weaker U.S. dollar. Adjusted EBIT improved slightly year-on-year despite a EUR 31 million negative from the ramp-up in Oulu.

In Packaging Solutions, we delivered a positive result despite ongoing market challenges. Sales increased slightly, driven by higher sales prices from improved product mix and an increase in sales volumes.

Adjusted EBIT increased year-on-year, supported by higher sales and the good momentum with value creation actions. So in summary, despite persistent overcapacity, actions to enhance product and customer mix, combined with continued cost efficiency improvements helped protect margins.

Moving from Packaging to Biomaterials. In Biomaterials, the challenging market conditions continued. Demand for softwood and hardwood pulp was weaker in both Europe and China.

Sales and adjusted EBIT decreased due to lower sales prices and volumes and adverse currency movements. However, intensified value creation actions such as cost reduction measures partly mitigated the negative effect.

In Wood Products, market continued to be subdued with high raw material costs and low construction market activity. Sales increased mainly due to Junnikkala volumes and higher sales prices, both in classic sawn and building solutions products.

Adjusted EBIT improved as the increase in raw material costs was more than offset by higher sales prices and value creation actions. Product curtailments were implemented to align with challenging market conditions.

Finally, in Forest, sales were stable with no material differences in wood prices or volumes. EBIT decreased primarily due to the divestment of the 12% of Swedish Forest Holdings at the end of the third quarter.

The fair value of the group's forest assets increased slightly to EUR 8.5 billion or EUR 10.75 per share. The results demonstrate strong operational performance within our forest assets and wood supply operations.

So with that, I hand back to you, Hans, for concluding remarks.

Thank you, Niclas. As we enter 2026, we expect market conditions to remain subdued and volatile, shaped by ongoing macroeconomic and geopolitical uncertainty. Our priorities are clear. We will continue to execute our strategy, drive proactive, systematic and determined work across the whole group.

We continue to improve profitability, cash flow and cost competitiveness through activities related to sourcing, operational efficiency, commercial excellence, working capital and fixed costs and maintain a disciplined approach to capital allocation.

The demerger and listing of our Swedish forest assets will be a key focus as will the ongoing strategic review of our Central European sawmills and ramping up of our Oulu site.

I want to thank all our employees, customers and partners for their dedication and resilience during this transformative year. Together, we are building a stronger, more focused and more sustainable Stora Enso. Thank you for listening and we are now ready to take your questions.

[Operator Instructions] Our first question will come from Charlie Muir-Sands with BNP Paribas.

I just had a couple of questions on the Packaging Materials segment on both pricing and on costs. Firstly, on the pricing side, I wonder if you could talk about the environment generally.

We've seen obviously indexation reports suggesting that FBB prices are coming down a bit. One of your peers the other day also flagged pricing pressures in the liquid packaging board space, which is a grade that's obviously not price reported. So yes, firstly, on the pricing side.

And then on the cost side, can you talk about what scale of tailwind you might envisage seeing from the fall in wood costs that we're starting to see in Finland and perhaps trickling over into Sweden? And when you would expect Oulu to no longer be a drag?

Yes. So first of all, when it comes to liquid packaging board, we have multiyear agreements, which basically meant that our prices have somewhat improved for this year compared to last year.

When it comes to cartonboard, you are right that following statistics, there has been some slight decline in prices there. And then as you also know from public sources, there has been price increase announcements in containerboard, in testliner, also in Europe happening lately.

Then on the cost side, I mean, yes, following also here public statistics, wood costs in Finland and Sweden, especially pulpwood, have come down throughout the latter part of last year. And -- but I don't want to take any stance on any predictions or forecasts here how the things will play out.

Regarding Oulu, we have guided now for the first quarter still a negative EBIT impact between EUR 15 million and EUR 30 million on an EBIT level. And we remain confident there that we are continuing and progressing the ramp-up in order to be then fully ramped up for year 2027.

But for Q2, do you anticipate Oulu still being a drag? Or should this be the last quarter?

Well, we don't give any further guidance there. I would say that the ramp-up is progressing. Quality is excellent. The feedback from customers is really good and quality properties, even if we had high expectations, having even exceeded our expectations in some cases.

And finally, sorry, just I saw that you're guiding to much lower income from sale of emission certificates in the year ahead. Which segments would those headwinds year-on-year apply to?

It concerns mainly 3 of our business units. So it's Skutskar, which is pulp in Sweden, then it's Fors in Sweden, which is cartonboard and then it's also Enocell Uimaharju in Finland, which is pulp. So it's mainly the Biomaterials segment.

Our next question comes from Lars Kjellberg with Stifel.

I appreciate you don't want to forecast wood cost. But if you kind of -- where we are today in Finland in particular and the pressures we see in Sweden, if they were to stay where they are, when would you start to see a positive impact from that?

I'm also hearing that wood costs in Poland has gone up. Can you provide any color on that, if that is indeed the case?

I also want to question a bit about currency because, of course, both the Swedish krona and the euro are very strong. You had hedges, of course, right, but what sort of potential headwind would that be?

And the final one, I'll just stick with consumer board, you have for a long time spoken to the pressures and imbalance in the market and soft demand. So the question is, as a big producer of consumer board, what sort of actions are you taking to rebalance the market and to get away from that pricing pressure?

I appreciate closing assets is not your priority, but are you thinking about meaningful curtailment of capacity until demand resurfaces?

I'll take -- I'll take the first one. So the wood cost up or down, I mean, I guess the rule of thumb is 3 to 6 months. So first, it goes into the wood yard and then it goes into production. So 3 to 6 months depends, but that's kind of the kind of rule of thumb, which you could use.

And then your question on consumer board. So yes, we have also taken some curtail -- or curtailed our capacity to some extent. I would say the primary actions here in a situation of low operating rates and is to be the most cost-efficient, to work on your cost and efficiencies and be closer to your customers than ever before and produce the best possible quality of product and service. That's the way to manage in this kind of circumstances.

You also had a question about the currency exchange rate, you want to comment...

Yes. Yes. I would say no -- nothing particular there. I mean, dollar has, as you know, been a headwind for us, the weaker dollar, given that quite a significant chunk of products, not least pulp is kind of dollar priced.

And then on the Swedish krona, of course, we have quite significant operations in Sweden. So a kind of stronger Swedish krona means more costs also. But I would say just in general that the dollar is the kind of main swing factor here.

Just a follow-up, I also asked you about Polish wood costs, if you have any color on that? And if you can share with us what sort of operating rates you're running at in consumer board in those?

Yes. So first of all, the Polish wood costs, we actually consume very little pulpwood in Poland because we are primarily using recycled fibers there to produce testliner. So it's not that relevant for us when it comes to log costs in Central Europe.

They have been increasing, but so have also the price of timber and sawn goods. And what -- and you had some other question there, a follow-up question. Yes, operating rates. Well, we are not commenting further on the operating rates.

Our next question comes from Pallav Mittal with Barclays.

So 3 questions. I'll take it one by one. So just following up on the first question around liquid packaging board. So your peer -- one of your peers has highlighted a difficult demand dynamic as well.

And based on what we can see, one of your largest customers over the last few quarters has also highlighted a difficult volume backdrop. So just wanted to understand the demand dynamics. Clearly, your comments on pricing, we agree that it is a multiyear agreement and it is going up. But what are you seeing on the demand side of things?

Thanks to the multiyear agreements we have in liquid packaging board with our key customers, we see positive development both in terms of volumes and price.

Okay. And as you have now highlighted for the last few quarters that the market-related movements have been offset by your own actions. So if you could just help us understand, I mean, as we think about 2026, lower wood cost, et cetera. So if you were just to like give us some guidance in terms of those 2 buckets, do you still expect the market-related movements to be a significant headwind and then offset by some of your own actions, which you have said EUR 500 million to EUR 700 million for the next 3 years?

Yes. I think on the own actions, the teams are continuing the good work and certainly we'll continue during 2026 as well. What comes to wood cost, as Hans said, we just don't want to predict or comment on that. But on the own actions, we'll certainly continue to work on that and there's a good momentum.

And then lastly, just on the EU testliner pricing that the industry is trying to pass through. Any comments on how customers are reacting to it because now we are in the first week of Feb and it was expected to go live on the 1st of Feb? And do you think any of it will actually pass through given the cost environment and the demand backdrop?

Yes, I don't want to speculate here, but I think there has been broadly price increase announcements and there is a broad price increase attempt now in the industry and it's, of course, badly needed by the industry.

Our next question comes from Linus Larsson from SEB.

First off, a follow-up question on Packaging Materials. The price realization quarter-on-quarter in the fourth quarter was quite negative, minus 7% or so, from what we can see.

Could you please just explain that mix effects, real price changes, FX, how that all adds up? And then also, please, if you could just clarify what you said previously on your multiyear liquid packaging board contract, what does that setup entail for 2026?

Can you please just clarify, have you had renegotiations going into 2026 for a portion of that? And what's the nature of the agreements in place? Do they imply price hikes or price declines at the start of 2026? So just directionally, if you could just please clarify that?

So first, your latter question about liquid packaging board. So with most of our key customers, we have long-term multiyear agreements in place, implying improved pricing and volume for this year, but not for all. I mean, there are also customers where we have annual negotiations. But generally speaking, for the majority, there are multiyear agreements in place.

And then when it comes to the Packaging Material quarter-on-quarter price development, so Q3 into Q4, so there was especially in the area of containerboard, some price reductions as we can see from public sources, resi and other sources as well as also in cartonboard. So that weighted on our average prices for Packaging Materials in Q4 compared to Q3.

Got it. And then maybe a second question on forestry and the increase that we saw in forest book values in the fourth quarter. And you did write about it in the report, but if you could just expand a bit on that, what drove the increase? And also any updates, if there are any on the planned spinoff, please?

Yes. So the increase was primarily driven by the stronger Swedish krona. So FX was the prime driver. Also kind of the underlying asset, there was some increase, but the EUR 200 million or so increase we saw was mainly driven by FX.

And then what comes to the spin, progress being made every day. Separation, a lot of activities there. So I would say on track and making good headwinds or good progress there.

Your next question comes from Ioannis Masvoulas with Morgan Stanley.

Excellent. Excellent. So a few follow-ups from my side. Just the first one, going back to liquid paperboard. Across your entire order book, if we think about '26 versus '25, is it fair to assume a low single-digit improvement in pricing?

And related to this, do you think you're gaining market share in either Europe or Asia, as that will explain some of your comments on volume trends versus some of your peers?

Yes. So in liquid packaging board, we have some slightly increased pricing for the majority of our customers. And when it comes to market shares, I don't want to comment on those.

Okay. And maybe one more on Oulu. So I appreciate you wouldn't like to provide full year guidance on potential ramp-up costs. But if we look at Q4, you account for about EUR 31 million impact.

And for Q1, you're talking somewhere between EUR 15 million to EUR 30 million impact. So at the high end feels like there is not much improvement or a reduction in the ramp-up costs. Could you talk about some of the challenges there? And could you also clarify whether Oulu was EBITDA breakeven because that's something you mentioned in the past, but I didn't see that in today's release in terms of the Q4 run rate?

Yes. So first, Oulu was EBITDA breakeven in when running full during month of October. Then towards the end of Q4, we had some planned shutdowns and also some curtailments.

But as we had guided before, we reached EBITDA breakeven in the month of October during, let's say, normal full run month. And when it comes to the first quarter, I mean, we are continuing the ramp-up as planned with excellent customer feedback and quality achievements.

And of course, I mean, we need also to take into consideration that the cartonboard prices, as we know from public sources, are somewhat down. So with a certain impact also here. Plus then, of course, we have to consider also other things affecting then the weighting on the Oulu profitability during the first quarter.

Our next question comes from Detlef Winckelmann at JPMorgan.

Just a quick one from me just on your pulp wood costs. Obviously, we've seen them come down quite drastically in the last, call it, couple of quarters. I'm hearing some conflicting views.

I just want to hear your thoughts on whether this is a supply chain change or a demand-only driven price decrease. We're hearing from a handful of people, independent experts that maybe supply and wood being harvested is actually up. And at the same time, I'm hearing the exact opposite from someone else. So just would love some clarity there, if you can.

Well, yes, do you want to take it, Niclas?

Yes. I mean, sure, there's multiple factors, but to put it simply, the view is more demand. So demand has been lower. Some of the industry players, for instance, in Finland have been -- Finland have been curtailing production during the second -- latter part of the year.

Our next question comes from Cole Hathorn with Jefferies.

Just like a follow-up on the wood cost side of things. You provide some helpful guidance for a 10% move in wood cost for the whole of Stora, which includes your sawn timber business as well as obviously your Latin American operations.

Is there a guidance just so that we can think about the sensitivities for a 10% move just in the Nordic wood prices, just to understand the quantum? That's the first question.

The second is thinking about the liquid packaging board of Beihai and given there's a number of capacity that's ramped up in China, just like any commentary that you can provide about profitability of your Beihai and China operations?

Yes. So first of all, our Beihai operation is doing very well. Also from a profitability perspective, it is one of the world's, if not even the world's most efficient board -- consumer board production line according to board machinery manufacturers statistics.

So doing very well indeed. Excellent quality. I mean, we are competing in the high-end, highest quality liquid packaging board segment and consumer board segments in China, where we have an opportunity also to differentiate.

And then when it comes to the wood costs, as you can see in our report, a 10% wood cost decrease would have a EUR 238 million impact on annual -- positive impact on annual EBIT. We haven't broken down that specifically for the Nordics, but the clear majority of this is the Nordics. So not all of it, but the clear majority.

And then maybe just as a follow-up, Niclas, your CapEx numbers come in nicely at EUR 550 million. It is lower year-on-year. It's the first time you're getting towards depreciation or below. I'd just like to think about how you're thinking about CapEx.

And then, Hans, one for you on the EUR 500 million to EUR 700 million savings. Is there any color that you can give on what might be contributed in 2026? Because there are a number of moving parts this year.

We do have lower prices. You've got potential positives from the Oulu drag being less negative. You've got the positives from potential wood costs, but the bucket that's missing is your own internal actions and efficiencies. Any quantum of that EUR 500 million to EUR 700 million that might be achieved in 2026 would be helpful.

Yes. So on the CapEx, we've done a fair amount of work on CapEx in latter part of last year and we discussed some of it in the CMD as well. And of course, one part of it is the, as we call it, the end of the heavy investment phase, which is primarily Oulu, but we've actually gone beyond that.

I mean, we've looked a lot at where do we get returns, what type of investments are better, which ones are worse and so on and so on. A lot of categorization of our different assets, where do we invest, where do we not invest.

So what you see now in the EUR 550 million guidance is kind of a summary, the outcome of this work. And it's -- in the end, it's all about discipline and returns. And I'm sure we'll learn more during this year and then we see how it moves beyond this year also. But the theme is clearly now let's be disciplined and let's ensure good returns on those investments we make.

And when it comes to the -- our own profit improvement actions, in the CMD, we explained that during 2024, we -- and then the 3 first quarters of 2025, we have achieved EUR 850 million of annual P&L impact and we are now at roughly EUR 900 million after the fourth quarter.

And we also said that there is more to come. Currently, we have in the pipeline, EUR 500 million to EUR 700 million of projects and initiatives from a P&L impact standpoint.

And as we said in the CMD, 2 to 4 years, 2 years if we also get some market tailwind. So in order to achieve about 10% EBIT margin level, so 2 years, if we get some market tailwind and 4 years if we have a continuous market headwind.

So that's about the guidance I can give. Of course, the more you do these cost savings and streamlining, the harder it also gets. That's also good to remember.

Yes. And just to give you some additional color because it's a good team, nice team. So for instance, what we are looking at for the moment is fixed cost? How do we work efficiently within Stora Enso. And then also procurement is another area we are looking into as we speak. And there is potential. So it's quite positive and good.

Our next question comes from Andres Castanos-Mollor with Berenberg.

It would be a follow-up on CapEx, please. How much of that EUR 550 million is allocated to forest? And how would our run rate of an ex-forest company look like for maintenance CapEx?

Now I'm actually looking at Jutta here across the table. How much of that is forest? I can't remember by heart actually.

Right. It's not that much biological assets to some extent, but there also maturity would be actually Latin American CapEx. So it's not that much that goes into the forest.

So very, very little into the forest company as such.

There are no further questions. I shall now hand back to Hans Sohlstrom; and CFO, Niclas Rosenlew, for closing remarks.

Thank you very much, all, for your -- for taking time and for your interest. As you can see, we are moving forward with speed and determination to improve our financial performance and to strengthen and build a better, more sustainable and more valuable Stora Enso.

During last year, we have sharpened our strategic focus. We have defined our strategic priorities of leading in customer value, putting the customers in the center through innovation, sustainability and service and quality.

We are looking to -- also to grow faster than the market, over 4% per annum. And we have a track record within renewable packaging of growing above 5% during the last 10 years and we are well invested to materialize this growth.

We are expanding our margins to the well above 10% EBIT margins through our own actions regardless of market circumstances. And then last but not least, we are generating cash through disciplined capital allocation. Thank you very much for your interest. We are moving forward with speed and determination. Thank you. Bye-bye.

Hello, everyone, and warm welcome to Stora Enso's Capital Markets Day 2025 here in London. And to all of you joining us via the webcast as well. My name is Jutta Mikkola, and I'm the Head of Investor Relations here at Stora Enso. And with me today on stage will be our President and CEO, Hans Sohlstrom; our CFO, Niclas Rosenlew; and our business area leaders, Andreas Birmoser, Carolyn Wagner and Johanna Hagelberg.

I'm very excited about today and our agenda. And like the high-rise building, we are here today, Stora Enso is also reaching high and looking forward. So first, let's discuss the outcome of the strategic review and outline next steps. Then our focus will be on evolving Stora Enso and our strategic priorities for the coming years. We are also changing our reporting structure, which we will explain as well as our new group financial targets and the way to get there. You will -- then we will -- in the second session, we'll be rolling up our sleeves and taking a deep dive into the business. You will get insights into what drives our operations and sets us apart in the industry.

Please be active and ask questions, especially during the Q&A sessions as well as during the breaks and lunch following the event. Our group leadership team is here as well, and they are waiting to have discussion with you. [Operator Instructions] So as I said, I'm super excited for today. We have a lot to share, so let's dive in.

[Presentation]

Good morning, ladies and gentlemen. Really great to see you all here, and welcome also everyone joining through the webcast. This is an important day for Stora Enso and hopefully also for all of you. I'm Hans Sohlstrom. I'm the President and CEO of Stora Enso. Today, we are going to talk about the road map for the future, how we are building on strong foundations, how we are strengthening our business focus, sharpening our focus and how we are taking determined actions to build a better performing Stora Enso and maximize shareholder value.

But before starting, we know that business success is all about people and it's about leadership. And I'm so proud to have with me here our group leadership team and would like to introduce them one by one so that you can reach out to them during the breaks or during the Q&A sessions and ask questions. It's a great team, hard-working, ambitious, and we are working hard, but we also have great fun together.

So let's start here by the introduction. So first of all, our CFO, Niclas Rosenlew. Then we have our Executive Vice President in charge of People, Legal and General Counsel, Micaela Thorstrom. We have our EVP, Strategy and Sustainability, Tobias Baarnman. And now moving to the lower row here with the Executive Vice Presidents with the P&L responsibility being in charge and accountable of their business areas. We have first Cartonboard, Andreas Birmoser. Then we have Food Service and Liquid Board, Markku Luoto; Containerboard, Lars Volkel; Packaging Solution, Carolyn Wagner. We have Biomaterials, Johanna Hagelberg; and Wood and Energy, Pauli Torikka. And last but not least, we also have appointed the President and CEO for the new forest company, and he's also here with us today, Tuomas Hallenberg.

Good. Let's move on. We have 2 objectives of today. We are going to share more information about the demerger of our Swedish forest assets as well as then also to affirm Stora Enso's strategic focus and way forward, the road map to achieving the updated financial targets that we have published yesterday. So where are we today? Stora Enso is a leading -- a global leader in renewable materials. Our purpose is to replace fossil products, nonrenewable materials with renewable products. Everything we do is based on wood raw material, renewable raw materials and replacing the fossil alternatives, plastics, cement and other.

And our ultimate target is to maximize shareholder value. The most important KPI for me, for our group leadership team is total shareholder return. And the way we are maximizing shareholder return is really through high customer value based on innovation, quality, sustainability and with efficient, integrated cost-competitive operations. Our corporate culture, we call it our positive performance culture is based on 4As. And I bet if you ask any one of our 19,000 employees today, what are the 4As, they can all speak about the 4As of ambition, of agility, analytical approach as well as accountability and what it means for them and their work with their teams.

So this is a snapshot of Stora Enso today. And I'm truly proud of the fact that Stora Enso is a part of solving some of the biggest challenges on planet, climate change. Last year, our products helped avoid 14 million tonnes of CO2 emissions through our renewable products, replacing plastics and cement and other fossil materials. Today, packaging is representing about 60% of our total sales, and we have leading market positions in all our businesses, and we'll deep dive into this throughout this day and these presentations.

So how have we arrived here? Well, in the beginning of this millennium, actually, 80% of Stora Enso's roughly EUR 10 billion sales, 80% was printing papers. So newsprint, magazine papers, copy papers, and we all know about the declining printing paper business. During the 10 years back, 2015, still printing papers was the biggest business within Stora Enso, representing almost 40% of our turnover. It was bigger than packaging at that time. But since then, we have systematically invested in growing our packaging business.

And most recently, we have also made some major investments here through the acquisition of De Jong Packaging as well as also our investment into Europe's most modern and efficient consumer board line in Finland that we are currently ramping up. And thanks to this systematic work on growing in packaging, where there are good growth prospects also for the future. In fact, our packaging business growth throughout the last 10 years has been above [ 4% ] per year.

But now we are taking the next step to sharpen our focus even further. We have divested at the end of September 175,000 hectares of Swedish forest with 2 objectives: to strengthen our balance sheet, but also to confirm the value of forest land. We sold exactly at our book value, meaning an enterprise value of EUR 900 million. And we are now taking the next steps with the demerger of our remaining forest in Sweden, 1.2 million hectares valued at close to EUR 6 billion, demerger into a separate stock-listed company with our current owners as the owners of this company. And then also, we have announced that we are starting a strategic review of our Central European wood products businesses, which are non-synergistic with our core Renewable Packaging business.

So I'm going to quickly talk through about the demerger, what, why and when. Well, we are creating 2 champions in their field. Stora Enso, the renewable packaging -- renewable materials company with a strong and increasing focus on renewable packaging, where we are maximizing profitability through leading with customers through our products and innovation and sustainability as well as operations that are efficient and cost competitive. The main targets for Stora Enso, the renewable materials company is, as published yesterday, to continue to grow as we have done during the last decade, at least 4% per annum and to generate an adjusted EBIT margin of above 10%. And we have the road map how to get there. We are convinced that we can deliver on these targets.

The business is global. We are serving blue chip customers all around the world, some of the most valuable brands who are operating in 60 countries globally. The forest company is about value appreciation and growing the value of the company through constantly developing the assets in a sustainable way and also to develop additional new revenue streams. Looking at historical facts, and I'll deep dive into this later on, the value appreciation during the last 3 decades has been 7% for Swedish forest assets. And the current value of these assets is close to EUR 6 billion.

So why are we doing this? Well, these 2 businesses, they have distinctive business dynamics, characteristics, and they also require distinctive business strategies for maximum value creation. And this is also the way how we can unlock not only the full business value by having a full focus on the very distinctive different businesses, but also to unlock the value for our shareholders.

So when will this happen? The demerger will take place during the beginning of 2027. We will keep you updated, of course, throughout the whole process with our proceeding in this process. And during this time, we have the possibility and opportunity to carry on and carry out all the necessary preparations, but also to demonstrate the strength and attractiveness of both businesses. And we are organizing a Capital Market Day in a year or so during next year's time, focusing fully on the forest company. The financial targets, the strategy, the business plan for the forest company.

So let's deep dive into the forest company. So what makes this an attractive asset for investors and owners? Well, looking at Sweden and forests in Sweden in general. So these are not only about our forests, but all forests in Sweden. Swedish forest assets have yielded a 7% value appreciation since 1990, over 3 decades. So forest is not only a sustainable asset as such, it's really a value engine. And if we break down now the 7% into pieces, we can see that during the last 3 decades, land appreciation represents 4.5% per year value appreciation. And in a way, it's natural because there is no more land produced. So land is a scarce resource.

Then there is also more growth in Swedish forests than harvesting. And this means that the standing stock, the biological growth of forests in Sweden has exceeded harvesting and added 1% per year additional value through the growing standing stock. And in fact, this 1% is accelerating, thanks to new sustainable forestry practices. And then we have, of course, the wood harvesting, which has historically, since 1990, given a 1.5% return, about 3% of the standing stock has been harvested. And the margin for this business has been well above 50% historically during the last 3 decades. But there is increasingly new non-harvesting-related revenue streams that becomes more and more important all the time. Renewable energy like wind energy, solar parks as well as also recreational income from recreational use or other gravel and other land development and optimization.

So what makes our forest in Sweden especially attractive within this landscape? Well, there is a simple answer, and that is location. Our forests are located optimally in the mid-south part of Sweden. where the productivity and the growth is significantly higher than in other areas in Sweden or North. Stronger and better productivity than, for instance, our main other forest-owning peers. And on top of this, in this region, in that mid-south part of Sweden, where our forest 1.2 million hectares are located, there is also an especially strong concentration of wood consuming forest industry. In fact, the forest industry in this proximity, in this region is consuming 40 million cubic meters of wood annually.

Our standing stock on this 1.2 million hectares is 130 million cubic meters, and we are harvesting over 3 million cubic meters per year and meaning that harvesting is still clearly below the growth. So the standing stock is increasing 1% per annum, but this is something that also can be accelerated. And on top of all of this, there are also very strong sustainability features of our forests. Our forests are sequestering, binding 1.5 million tonnes of CO2 every year. And this gives us also opportunities for new revenue streams as we move forward.

In addition to this, there will be an 18-year wood supply agreement in place between the forest company and Stora Enso. It will be with reducing commitments, gradually reducing commitments throughout that 18 years period. And this enables to provide to the forest company stability and predictability for the first years, for the first period, but then also flexibility to gradually build up new customer relationships and new businesses. The pricing will be market price based, and it's really important for us that this will be an independent company operating on market practices, so that we can really build an independent leading forest company.

But then it's not all about harvesting. It's also about those new incremental revenue streams. And I'll give you some examples here. I'm truly proud of the fact that within Stora Enso forest, we have developed a world-leading digital tool. Nobody else has this. We call it Precision Forestry. And it's a digital model that is using artificial intelligence to all the time get more and more accurate, combining our data on our own forests with satellite data and laser scanning data on other forests. So we have been able to create a very accurate digital model of all forests, not only our forests, but all forests that exists in the Nordic countries and in the Baltics.

And what's the benefit of this? Well, we have already with this model that gives really granular and exact data, we have managed to find in our own forests, tens of thousands of hectares more productive land. In addition, we can also protect the environment more effectively by identifying on a very granular level, valuable natural habitats. So it's all about forestry, but being much more data-driven, much more precise. And using this tool, we can improve our productivity, our income, but at the same time, also protect valuable natural habitats much more exact. We can even predict with a high level of accuracy where, for instance, certain species, endangered species are living or -- so we can also see that we are proactively taking this into account when we're, for instance, developing our forestry plants.

Then we have renewable energy as another big opportunity for us. Our strategy when it comes to renewable energy is to develop ready-to-build projects because we have the land and we identify the optimal land for wind parks, solar parks. We apply for the permits, which can be very long processes, taking several years. And we also organize the land connections, build the roads, grid connections. So we have like ready-to-build projects. And then we sell these projects with the permits, with the infrastructure to, for instance, energy companies who are specialized in operating wind parks or solar parks. And we have plans in place now to commercialize 10 terawatt hours of wind park projects. But this 10 terawatt hours is only a fraction of the total potential we have on the 1.2 million hectares of land. There is many times bigger potential, but it takes time to develop this. So many of these revenue streams comes then fairly long into the future.

Then we have the land value optimization. We constantly already today, we sell land with high set aside areas, and we buy land, which are more fiber-rich and more productive. Also through land planning and zoning for real estate, housing, industrial use, we can significantly increase the value of our land areas. And then last but not least, carbon storage. This is clearly a new emerging market since about 1 year back. With all the carbon sequestration in our land area, with all the carbon credits that we are -- that we have and new ways of actually capturing carbon without affecting forest productivity. For instance, by rewetting dried peatlands, which don't produce any wood in any case, by rewetting peat land, scientists have concluded that we can tie up 250 tonnes per hectare of carbon on these rewetted peatlands.

And there are today more and more multinational technology company, leading companies that you have all heard about, who are in contact with us, asking us to sequester to bind carbon for them. They are prepared to pay to us so that we capture carbon on their behalf. And this is an interesting emerging business and new future revenue stream that we are going to build on a new market with new opportunities with all the data centers all around the world and all the energy consumed for data centers. The technology companies are eagerly looking for carbon sequestration, and they are prepared to pay to someone like us who can provide that service and also the evidence of their carbon being captured.

So let's now move into Stora Enso, the renewable materials company with a strong focus on packaging. First of all, let's start by acknowledging facts. I mean, our profit, our cash flow is far too low. We know that, and we are working on it every day to improve profitability and cash flow. Since 2023, we have encountered an unusually challenging operating environment with record high wood costs, especially in the Nordics, with geopolitical uncertainty, which has fueled uncertainty among consumers. And what is really driving our demand is consumer spending. So with lower consumer spending, also demand is lower. And at the same time, we have gone through an unusually heavy investment phase. But since 2023, we are taking determined actions to improve our cash flow, to strengthen our margins, expand our margins and improve our profitability.

I'll give several examples about this later on during this morning. And we will continue to focus on our 4 strategic priorities, which is to lead in customer value through customer-driven innovation, sustainability and quality to continue growing faster than the market through our cost-efficient assets through our offering and our collaboration, winning with customers. We will continue focusing on expanding our margins through our business and customer focus as well as through our positive performance culture and our systematic way of working on value creation initiatives, which you will hear more about later on. And we will focus on generating cash with high conversion ratio as well as disciplined capital allocation. Also more about this as we move forward.

So these are our 4 strategic priorities. They have been for 2 years, and they are going to be also for the years to come. These 4 strategic priorities are built on 5 strengths or positionings that I want to explain and open up more to you in the next. So first of all, all the markets we are operating in are growing, driven by strong sustainability drivers. We have exited the declining printing paper business and everything we have now in our portfolio, there is long-term growth driven by consumer preferences and sustainability drivers.

We also have leading market positions in all the businesses we operate in. And we have a broad, very strong differentiated product portfolio, which is based on customer-driven innovation. And our assets are well invested. We have strong assets and cost competitive asset base. And last but not least, we have now during 2 years, the proof that we can -- through a continuous improvement culture and through this performance culture, we can continuously find ways of reducing our costs and improving our competitiveness.

And I'll walk through these 5 areas one by one with you here now. First of all, the global packaging industry is transitioning, driven by new and emerging customer preferences. Today, globally, over half of all consumers, they care about the package. They care about the recyclability of packages. They care about the carbon footprint of packages. They care about the renewability of packages. And just to give an example, today, 1/3 of all food in the world is being wasted, 1/3. This means 1.3 billion tonnes of food goes to waste every year in a world of scarcity where people don't get enough food. We are especially good in food and beverage packaging. We can -- we have solutions to provide safe food packaging solutions and to preserve food also in right-sized packages from production to the end consumer.

So we are, in fact, contributing to reducing food waste through our solutions. And we are extremely well positioned actually to gain from these changes in the global packaging market. In fact, all research shows that renewable packaging materials will continue to gain market share from plastics. And if we look at our main 2 markets where we operate in Packaging Materials, so consumer board as well as virgin fiber-based containerboard, this market -- this global market is predicted to grow by 12 million tonnes of annual consumption, annual demand in the next 5 years. And within these segments, especially the food and beverage packaging, which is really our core, is having the fastest growth rates, well above 3%.

We have also leading market positions in liquid packaging board, we are clearly the world's largest producer in cross-laminated timber also as well as in unbleached specialty pulps. And we are a European market leader in other virgin fiber-based cartonboards and boards as well as in fluff pulp and sawn wood. And in containerboard, we have regional leading positions. We are serving some of the leading brands in the world. They are our customers, and you will get many examples here as we listen to Andreas', Carolyn's and Johanna's presentation.

And why do they choose us as their partner? Well, because we help them to become more attractive on the shelves in the retail stores. They want to have sustainable, recyclable, renewable packaging solutions, which looks attractive, which appeals to consumers and make consumers choose their product over other products. So we can help these customers to differentiate. We can help them also through lightweighting to save costs compared to competing board grades, for instance, or packaging solutions. And we can also help them to significantly reduce the carbon footprint, which is so important for these brand owners. They have carbon commitments also and climate commitments.

We have cases where we have helped our customers reduce their carbon footprint by 70% by our -- moving to our choices instead of alternative packaging materials. Customer-centric innovation is really at the heart and in the core of what we are doing. We come up and we launch a new product to the market every month. And if we look at this customer-centric innovation, I'm so happy by the fact that today, 16% of all our packaging material, all our product board sales actually comes from new products that have been launched into the market during the last 5 years. And this is accelerating. We are investing more than ever before in customer-centric innovation when it comes to our packaging business.

And I have here 2 examples for your -- just as examples, and you will hear many more examples later on. AvantForte is by far the best-performing brown and white top kraftliner with the best strength weight ratio in the whole world. And this is especially appealing to packaging needs, transport packaging needs where you have especially demanding conditions, like, for instance, fruit and vegetable producers who are operating in humid conditions and who have global supply chains, so logistics spanning over the whole world. We have so many cases where AvantForte is by our customers, actually the only choice and also the most cost-efficient choice, thanks to the strength weight ratio. We have New Tambrite as another example, which has the best stiffness to weight ratio among all cartonboard grades globally, which means that it's a preferred choice. It's something we have developed together with our pharmaceutical customers, and it's their preferred choice.

So looking at our product offering and our product range. We also have the most complete, the broadest product offering in the industry. And this is a strength when building partnership with our customers, the brand owners and the converters because we are their one-stop shop. Whatever their renewable packaging needs are, we have it, and we can offer it to them. So this deepens our relationships and strengthens our partnership with customers.

But there are also other advantages around customer-centric innovation because we have the experience of producing all these grades. There is also cross-fertilization of ideas and innovation, which makes us even stronger in coming up with new product offerings. And last but not least, this also gives us strength when it comes to our asset utilization. So depending on trends, depending on market and customer needs, we can also optimize the asset utilization over the whole platform.

So what about our assets? Well, we have the biggest production lines and also among the youngest production lines, meaning the lowest technical age. So we have well-invested modern technology, and we have big production facilities, which gives economics of scale. And in fact, when you look at our board production mills and units, 75% of our machines production lines are within the first and second quartile in cost efficiency, so on the cost capacity curves. And we are integrated. And that's a big advantage also for -- in the forest industry and in the board production. What you need in order to be cost efficient is that you need those big, modern board machines. And on site, you need to have that integrated pulp production. And we have, in fact, out of our 6 million tonnes of board production capacity, paperboard production capacity, we have 5 million tonnes of on-site integrated pulp capacity.

Most of our board mills, almost all of them and most of our capacity is fully integrated backward into pulp production on site. And on top of that, we have sawmilling capacity on-site or close by. And this is extremely important, thinking about wood procurement as well as cost-efficient raw material supply. Because, in fact, about half of the logs going into sawing ends up in chips and saw dust, which is cost-efficient raw material for pulping and board making. So you cannot really be cost efficient without having these 3 components, preferably everything on the same site.

In containerboard, we are, of course, in virgin fiber containerboard, backward integrated like in cartonboard into on-site pulp making and sawmilling, but we are also backward integrated in terms of our recycled fiber-based test liner production into recovered fiber or paper -- recovered paper collection as well as recycling facilities. And we are also forward integrated into corrugated box making, because this is a very local business, and it's important to be competitive here that you have testliner production and corrugated box production close by. And Carolyn will open up this later on in her presentation.

On top of this, we have 2.5 million tonnes of market pulp capacity. And more than half of this 2.5 million tonnes is among the world's lowest cost, most cost-efficient eucalyptus capacities in South America. And it's a clear trend in Packaging Materials that eucalyptus pulp is more and more gaining share. We are doing that actively. We are using more and more eucalyptus pulp in our recipes, in our mills because it is a cost-efficient solution. And for instance, Veracel, if we look at our capacity in Veracel, with Oulu fully ramped up, Oulu will consume 250,000 tonnes of Veracel eucalyptus pulp as a part of their furnish together with CTMP and some other chemical pulp. And that means that we will consume 75% of Veracel's capacity internally in Oulu, in Beihai, China, in Fors in Sweden and so forth.

Enocell, Skutskar, they are very much specialized pulp mills, and Johanna will open up that in her presentation, and they need to be specialized also because they are operating in the Nordics where the raw material wood cost is higher. But through specialization, we can make healthy margins also in these businesses. But also Enocell and Skutskar are partly, to some extent, supplying our board needs for, for instance, unbleached kraft pulp as well as some other pulps.

So this vertical integration is a clear advantage. And we are, in fact, the only board producer, paperboard producer in Europe with own cost competitive eucalyptus pulp assets in South America. And that is a strength we want to build on. But now we are coming actually to my favorite theme, and that is about our own actions to continuously improve our margins and our profitability. We are working very systematically since 2 years back in operational efficiency improvements, commercial excellence, sourcing improvements as well as fixed cost reductions. And I'm so happy to see the results we have been able to achieve during the last 2 years, and we are continuing on this path.

We have a process in place that we call VCP, value creation programs. And what it really means is that we have a systematic approach to, for instance, in operations. We have mill sprints, which means that we are focusing 2 weeks, 1 mill at a time. We gather all the best experts we have in different fields of operations, energy, board making, pulp making, optimization, wood yard, all of that. We gather those best experts together. We focus on one mill at a time. We generate ideas and plans, how to reduce our costs, improve operational efficiency.

And then, of course, we move to the next mill, and we do the mill sprint 2 or 3 weeks at the next mill. We have now already gone through all our mills with the first round of mill sprints, generating lots of ideas, initiatives and also executed on these ideas. And now we are actually -- we have already started the second round. So it's a part of our continuous improvement work. And I'll give you some example to show what kind of VCP initiatives we have identified and executed on.

On the commercial excellence side and sourcing side, we have a win room concept where we gathered experts together to focus on a specific question, for instance, a certain chemical that we need to source. And we go through -- and we work together with our suppliers to find ways of reducing our total cost of ownership. And then, of course, we work on cost efficiency measures through fixed cost reductions. During the last 2 years, we have reduced our workforce by over 2,000 FTEs. We are continuing on this path. And as a result of the reorganization we announced and implemented on the 1st of July, we can take the next steps of streamlining our organization by delayering, taking off layers in the organization and even further reduce our fixed costs.

We have also a project management organization in place on the group level as well as in all our business areas that is supporting the value creation program work. And we have integrated our VCP work into our daily steering of the business, business planning, forecasting, follow-ups and daily management of our company. And in fact, when we look at what we have achieved during the last 2 years, we have, in fact, and we can prove that EUR 850 million of profit impact through the VCP work has hit our bottom line already. And we have in the pipeline of ideas to be executed and to be developed EUR 500 million to EUR 700 million more.

But this is not a project. It will not stop here. This is our new culture, our continuous improvement work where we constantly look for new improvement opportunities. So it wasn't enough that we did a first round of mill sprints, then we start the second round, and there will be a third round and a fourth round. So it's our new way of working, and this is really what we mean with our performance culture.

And I'll give you now some examples of these value creation program initiatives and their results. We have so far identified over 4,000 VCP initiatives. I'm truly proud of the work done by everyone in Stora Enso in every mill, every function, every part of our organization. We have 800 initiative leaders who are working on these together with their teams, meaning that we have thousands of people who are every day working on saving costs, improving our margins.

And here are 3 examples of these 4,000 initiatives. We have, for instance, in the Imatra Mill, advanced energy optimization management, which has yielded us -- given us more than EUR 6 million of annual cost savings. We have, in Enocell, found ways of increasing the production of tall oil, and there is a market for tall oil, which means that we have a EUR 2 million -- about EUR 2 million annual profit impact through this VCP initiative. Fors is a great example of moving to 100% Veracel eucalyptus pulp. We have been able to replace other pulp grades, Nordic pulp grades and to save over EUR 7 million every year, improving the cost competitiveness of this mill.

Here, there are 3 other examples out of these 4,000. In Montes del Plata, we have moved to methanol from our evaporation plant to be used to replace heavy fuel oil, giving us a saving of over EUR 1 million annually. Beihai is another great example. Beihai has been working systematically on improving their efficiency, performance. And in fact, today, Beihai has the best overall equipment efficiency of all board mills, not only our board mills, but all board mills in the world. They are actually the world record in OEE, the best performing board mill among all according to statistics that we receive from board machine suppliers. And then we have Skutskar, another example, improving the digester process and optimization, giving more than EUR 2 million annual savings.

These 6 examples are relatively big saving examples. Most of the VCP initiatives, we are speaking about hundreds of thousands of euros or EUR 0.5 million, that magnitude, but these are really good and clear examples. And we share these practices regularly with our whole company through what we call transformation days where we have had so far, they are virtual meetings, teams meetings. And so far, we have had thousands of our employees participating. And we organize these transformation days of 2 reasons. First of all, we want to share best practices, and we want to inspire each other to come up with good ideas.

And for instance, the great idea of energy saving in Imatra. I bet that in Skoghall, they all think that actually we can do even better. We need to show them that we can save even more. So that's the kind of a spirit we want to create here, inspiring each other. But there is also another reason, and that is to celebrate success and to really put the true heroes in our organization into the spotlight. The engineers, the experts that are working every day on improving the performance and portfolio and performance of our company, the 800 initiative leaders and the team members. Those are the true heroes that really get this improvement and builds a better and stronger Stora Enso.

So now summarizing. We are building on our 5 strengths of growing markets, attractive markets with leading market positions. We have attractive product offering based on our customer-centric innovation. We have cost competitive, well-invested assets, and we have the systematic continuous improvement work, the performance culture and the value creation program work that is accelerating in our organization. And we'll continue -- we are determined to continue focusing on our 4 strategic priorities to lead in customer value to grow faster than the market, continuing on the path we have demonstrated throughout the last decade and also building on the big investments that we have carried out during the recent years. We are determined to expand our margins and our profitability in -- through business focus, through the VCP work and our systematic, diligent and disciplined approach. And we are generating cash with high conversion ratio as well as a very strong and disciplined capital allocation for the years to come.

So now I will hand over to our CFO, Niclas. He will explain how these strategic priorities are translating into our financial plans and financial performance. Over to you, Niclas.

So hello, everyone, and fantastic to see you all. It's great to see a room full of nice and good people and look forward to the questions as well. Just on a personal note, I joined this fantastic team and this fantastic company in January. And before I joined -- by a few people who knew Stora Enso that, okay, what sort of animal is Stora Enso.

And very much echoing what Hans was saying. I mean we are highly appreciated by our customers. We are known for innovation. We are known for sustainability. But there were a couple of weaknesses, a couple of improvement areas as well. And those were portfolio. So portfolio a bit complex and then capital allocation. Super happy actually that we are addressing these weaknesses as well as the strengths head on. I'll talk a bit about capital allocation and portfolio Hans explained about. So we are addressing the forest, and we also have the strategic review related to the Central European wood products.

So how -- what Hans said, how will that translate into performance and financials? I'll start with 2 things we announced yesterday, communicated yesterday financial targets and then segment reporting, how you will read us, how you will understand how we progress going forward. And then I'll get into profit, CapEx, debt and cash flow.

So financial targets. First of all, we have the macro drivers. We have what it takes to grow. We are invested. We have competitive assets. So the macro drivers, we are in a market which is growing and likely growing for a long time to come. So we intend to grow more than the market, and the way we define it is that, that's more than 4%. Secondly, EBIT, very important, especially now, here and now in this environment, but also going forward. We have a clear ambition to get to 10% and actually above 10%, and I'll come back to this. And as Hans mentioned, the good thing with this is that this is in our own hands. We do not rely on the market to get to 10% and above 10% but I'll come back to that.

Shareholders, super important. We need to put even more weight on shareholder return. And one sign of this is the dividend, of course, and 50% of net profit over a cycle needs to be dividend or paid out as dividend. And then the fourth one is our net debt and balance sheet strength. And here, we actually take pride in being conservative. We will drive our net debt down to less than 1x EBITDA. And also here, very clear plan in our own hands, so not relying on external factors. So these are our 4 external -- or not just external, but these are our 4 long-term targets, both internal, external, which we relentlessly will work on and will get to.

Then how do you follow us? How do we follow ourselves, what progress we are making, where we are doing well, where we need to do more? We're also renewing our segments. So from Q1 onwards, we have Consumer Packaging, we have Integrated Packaging and we have Biomaterials. So let me briefly touch upon the segment reporting before then moving on to profit and capital allocation. To the left here, you'll see the current or the old segment reporting as of first Q1 '26, that's out of the window, and we move to the new one, which you see here to the right. So again, Consumer Packaging, integrated Packaging, Biomaterials and then other.

And what makes me excited here. And one thing kind of in addition to what Hans mentioned about VCPs, which we relentlessly push every day is the P&L responsibility. So behind these segments, we have 6 business areas, and every business area is P&L responsible. You have the owners of the 6 business areas here in the room, and we'll hear more from them in a few minutes here. And then as part of the 6 business areas, we have 24 business units, each of the 24 being P&L responsible.

And this is something that we set up now 1st of July. So this is up and running. And now we are working through the motions really to get people used to this P&L responsibility. So it's actually a distributed P&L responsibility. It's not just Hans who needs to scream and shout and say, improve, improve, improve. But actually, we have -- we all take responsibility for delivering results day in, day out.

One detail here is that within the other segment, we have the new business area, Wood and Energy, big operation for us given where -- what we do as a company. Here, we will also have the Swedish forest. So the to be demerged Swedish forest is part of other as well as the Wood Products Central Europe, which will also be part of other.

Then moving on to profit and how will that look like going forward? How will we get to the 10% and above. Let's first start with the history. And we've had a couple of pretty volatile and tough years here behind us. But when we look behind the kind of headline numbers, what's been happening in the last couple of years, if we go to 2024 first. In 2024, we had a significant headwind from higher fiber costs. Fiber costs were actually EUR 300 million higher in '24 compared to the prior year. Despite that, we actually improved the profitability. And that was thanks to the value creation actions. That was thanks to the relentless work every day throughout the organization to improve the performance. So we actually had EUR 450 million of identified actions in 2024, offsetting the market headwinds.

And then if we move to this year, 2025, it's actually a similar picture. Yes, we've had market headwinds, consumer demand, weak fiber costs, another EUR 300 million higher than the prior year, offset by EUR 400 million in own actions. On top of that, we've had the headwind from the Oulu ramp-up. As you know, a bit more than EUR 100 million in headwind. But all in all, underlying profitability improving despite the market headwinds and again, thanks to the own actions.

So where does that lead us? Today, we actually, give or take, a 7% EBIT company. Assuming then, not just assuming, as we are planning to demerge the Swedish forest, take the Swedish forest out, that will take our EBIT margin down a notch. And from that, a notch down, we are climbing up to 10% and above. And where does that come from? Again, very important point. This is through our own actions. We are not relying on the market. We have identified between EUR 500 million and EUR 700 million of own actions coming on stream and having an EBIT impact, profit impact over the next few years.

And again, we heard about this from Hans. What are these? These are operational, these are sourcing, these are cost-down activities, the whole range. They're all logged. We all have them in a system. We have a small central team managing this. And of course, the activities, the actions, they come from the P&L responsible units. So it's a pretty methodical, at least for me, a pretty cool way of doing it. On top of the EUR 500 million to EUR 700 million in own actions, we have the large investments, primarily Oulu here, but also De Lier ramping up coming on stream, which will add another positive measure as these are margin accretive volumes then or sales coming on stream. So with that, 10% or more. And on top of that, one day, the market will come back. That will be on top of this. And also, of course, if there's further headwinds, this will be offset by our own actions.

Let's then move to capital allocation and CapEx. If we look at our recent history, we have invested a lot. We now have what it needs to grow. We don't need to invest to capture growth. We need to bring what we have invested in on stream and make that productive. So we have a couple of years behind us with more than EUR 1 billion in CapEx investments per year. This year, we are coming down to somewhere between EUR 730 million and EUR 790 million. And next year, it will actually be lower. It will be below EUR 600 million.

And there's 2 reasons for us to be convinced that this is the direction, and this is the right thing to do. One is, again, that we have what's needed. We have made significant investments. We don't need to make significant investments now going forward. The other one is that we have worked quite a lot in the last few months on just the CapEx strategy, how we run CapEx, how we approve investments, how do we categorize our different assets. We've looked at all of our assets. We've looked at all of our sites, all of our mills, and we categorize those into 4 categories, ranging from run for cash to key. They have different investment profiles.

From a cultural perspective, we will work on taking pride in running our assets for cash. So it's not just about investing and being proud of a new shiny machine, but it's also about what the return is and being proud of the run for cash mills. We have Matthias Friedrich, a fantastic colleague who is dedicated to looking into this, done a lot of work the last few months just to set up this new framework for being efficient in how we invest in CapEx going forward.

So from CapEx to cash flow, and here, you see a similar picture, the inverse of CapEx. We have invested a lot. That has pushed down our cash flows the last few years, and we are now turning the corner when it comes to cash flow. We take CapEx down. That's clearly one factor. The margin through our own actions will pick up. And then we have the Oulu board machine and also De Lier coming on stream, being the kind of revenue uplift part here. So turning the corner when it comes to cash flow.

How do we use that cash going forward? Again, pushing the message of disciplined capital allocation. Taking down debt, very important. That's what we are going to work on, and that's what we are going to do to get to the onetime target. Shareholder return, the dividend. And then with -- you can say in simple terms, when there's excess money, yes, we will do strategic investments, but we will scrutinize those strategic investments. And here and now, it's about investing in efficiency and optimization, less than growth, but the point being here that it's in this order and investments will be scrutinized.

Then on net debt and balance sheet strength, as said, we are taking down -- determined to take down the net debt to conservative levels. We are well aware of the target being quite conservative, and we're actually proud of that. We are happy about that. That's where we want to take this company to be safe, sailing safely throughout any market environments going forward. So we actually peaked in net debt this year 2025 on the back of the big investments that we made that are now or have come to an end. We took down net debt by roughly EUR 800 million through the 12% sale of Swedish forest. And now we are taking the next steps, the next couple of years and moving down towards that one or preferably even below 1x net debt to EBITDA. But again, very much in our own hands, not relying on market picking up or some external factors.

So just to wrap this up, this is in our own hands. We take pride. We have the P&L responsibilities. We have the people who can turn this ship not only around, but towards that 4% or more growth, 10% EBIT margin, dividend distribution and then a conservative balance sheet on net debt level. So we have what it takes. It's in our own hands and we will drive profitable growth. We will work or continue to strengthen the cash conversion. We will be more disciplined than in the past and very disciplined when it comes to capital allocation, safeguarding shareholder returns, dividends and then the healthy balance sheet.

So with that, thank you, and Hans, back on stage.

Thank you very much, Niclas, but Hans as well, obviously. And now we're actually open already for the Q&A. And there, we have very eager hands already up. But a couple of instructions first. [Operator Instructions]

But with this, I think we can start. And actually, I have one opening question before we open it for the people here. So Hans, this is for you. It's about our culture. So what is the largest cultural shifts that you have worked with internally in a way to implement these efficiency improvements already?

Well, it's absolutely our 4A concept. The day when I was appointed as CEO, I had an all-employee call. I said that, hey, now we will start focusing on profitability, cash flow, deleveraging the company. But more importantly, this is a great company with great foundations. The only thing I see we need here, we need a performance culture. And I knew I will get the question. So Hans, what do you mean by 4As -- performance culture? And therefore, I had -- in order to remember myself, what I mean with it, I had developed this 4A concept.

It's an ambition. It's that continuous improvement mindset. It's not enough that we are average or status quo is not an option. Always, we want to be the best in everything we do. Customer satisfaction, quality, operations, efficiencies, cost competitiveness, profitability. That needs to be the high ambition level everywhere throughout our whole organization. Then agility. That's extremely important, especially in a cyclical industry because it's about being proactive, being close to customers, knowing what the competition is doing, making proactive fast decisions, implementing with speed and determination instead of always being late in the cycle. You can win or lose a lot of money in a cyclical industry, depending on the productivity and the speed.

Then it's analytical approach. It's all about data-driven decision-making. It's not about who is the CEO and who is not or who has worked for the company for 30 years and someone only 3 months. No, it's facts, figures, analysis, that is the basis for all decisions. And then last but not least, accountability. Clear roles and responsibility, clear measurements, key performance indicators, decentralized P&L responsibility. We have now with the new organization in place since the 1st of July, we have 24 new P&L responsible business units, all the mill integrates, the former mill managers, they are today business unit leaders. They are accountable not only for the costs of their unit, but they are accountable for the EBIT, the bottom line of what they are doing.

And that is -- they are being challenged every month. We -- Niclas and myself, we have something that we call monthly performance meetings. Our colleagues, everybody else calls it the monthly barbecue. And they participate there, and we'll go through what was good, where have we proceeded, where are we lacking behind, why, what are the corrective actions and so forth. So improving profitability and performance is not really rocket science, but it's really about culture. That's the key.

Thank you.

Lars Kjellberg, Stifel. Coming back to Niclas, one of your initial comments, you talked about the issues of Stora, one being capital allocation as one of the things that needs to change. So the question is really that capital allocation has also been the driver for growth. So how do we then square up, continue to have that 5% growth with lesser capital? And the one thing that kind of was missing from the new KPIs was actually return. So on the investments you've done thus far, the returns have been pretty dismal and you have, of course, written off a huge amount of assets. So again, the question is really, how do we square up the continuation of that growth bigger than the market with lesser CapEx? And why do we miss the return metric in the KPI?

Yes. If I -- I'll start with the latter one, so the return. And yes, I mean return matters, return on our investment matters. And we went through that internal discussion that, okay, return on capital employed, EBIT, EBITDA, what measure to have. And return on assets, when we make investments, return on the daily business matters also going forward. And roughly speaking, the 10% EBIT is in line with 13% return on capital employed. So that's kind of the rough math there. So we are not forgetting it as such.

But EBIT is clearly just an easier measure for everyday management for people to understand day in, day out, again, not forgetting about returns. We will scrutinize returns also for CapEx, for instance, scrutinize returns for every -- all investments we do and similar requirements, hurdles there that it needs to meet the overall company ambition or be higher.

And building on that, the 10% equaling 13% return on capital employed and the growth aspiration. I mean we have invested heavily. We have the largest modern consumer board line now ramping up. We have -- actually the world's largest corrugated manufacturing plant acquired with De Jong, where there is also a ramp-up ongoing. So we still have a lot of capacity to fill.

And after that, in fact, if we do the same thing that we have done in Beihai, in all our board mills, we will have another 0.5 million tonne of board capacity. So there is a lot of we can do still through our internal efficiency, organic growth. We are well invested for the next 5 years. Meaning that, of course, there can be some investments we will do in order, for instance, to reduce our costs, improve our competitiveness. But still looking ahead for the next 5 years, we are very well invested to support at least that 4% annual growth.

Yes. Oskar Lindstrom with Danske Bank. I mean the Swedish forest lands are a huge sort of value event for you and for shareholders and investors. I mean the enterprise value or the book value of the forest lands in Sweden is like half of the enterprise value of Stora Enso. Now -- but if we look at forest land companies, both others in the Nordics, but also in North America, they generally trade at a discount and sometimes quite a steep discount to the book value when they're on sort of equity market. What can you do both in terms of structuring the sort of future relationship between the forest lands and your industrial operations and also in terms of boosting yield in your Swedish forest lands between now and I suppose the delisting to ensure that, that discount is as small as possible or perhaps not even a discount at all?

Yes. Maybe I'll start. So as you see here, I mean we are actually super excited about this split that we are working on, and we see a lot of value in it. I mean of course, again, back to shareholder value, that's one part of it. But the other part is then focusing on the business, having its own management, having its own kind of freedom to operate. Hans mentioned about some of those things that the forest company can do, which is on top of what we already do as a company. And of course, exactly as you say, those are the things that we will start working on and over time, will maximize.

This is a unique asset. I mean, it's a pure -- really pure-play forest asset. Many of the others or some of the others, there's not too many around in the world and especially not in Europe are not pure play. So it's -- yes, it will be a bit wait and see where the value lands. Of course, that's in your hands. We are true believers that this will be an exciting asset to own and have. And of course, yes, we'll work on it relentlessly now during the year to come.

And we saw it also during the sale of the 175,000 hectares. I mean there was a great interest, especially among institutional investors because they want to have that return profile very predictable, very stable. And also for them, the whole sustainability aspect is important that this 1.2 million hectares ties up 1.5 million tonnes of CO2 was also quite important. So this partial sale of 12% of our Swedish forest land really encouraged us and when we saw the great interest among especially institutional investors. So we feel good about establishing this Europe's leading pure-play listed company around forest, which doesn't exist today. So there is nothing really comparable in Europe. In the U.S., there is some a little bit similar, but not in Europe.

And then on the independence, which is a very important part, I mean these -- we are creating 2 fully independent stand-alone companies. And yes, of course, there's a joint business interest going forward as well, but both need to stand on their own, both need to be strong companies, strong balance sheets, strong businesses and have the independence to do -- I mean yes, ForestCo will have Stora Enso as a big customer. We have the wood supply agreement being developed, but also develop other customer relationships, as Hans mentioned, over time. So independence is very important.

Andy Jones from UBS. I just had a question about the asset base. I mean, clearly, you're trying to maximize the investments that you've made in the past. But in such an oversupplied market, as the consumer board market, in which you're obviously market leaders, I appreciate your cost curve position is pretty low. But as the largest producer in a lot of these grades, given the lack of closures from some of your higher cost peers, is it enough to say we're going to sweat the assets and drive down costs when in an oversupplied market, quite often, everyone is doing the same thing, prices just fall with it. As market leaders, should you not do more to help to address that overcapacity in some of your main markets?

Well, there is -- first of all, if we look at cartonboard, European cartonboard capacity, there is roughly 1 million tonne of cartonboard capacity that is higher cost than our single highest cost production line. But then it's not enough to look at the virgin fiber cartonboard. There is almost as big white top -- white line chipboard market, which is recycled fiber-based. And there are some examples actually we spoke there about, and I showed the pizza boxes there. One of the pizza boxes is produced out of recycled fiber-based white line chipboard. It's a 3 million tonne market in Europe. And then there is the same pizza box or similar pizza box produced out of our folded boxboard.

And in fact, the folded boxboard, our old, folded boxboard looks much better. It's whiter, it's cleaner. It has the same stiffness properties, better printing properties, but it is 40% to 50% lighter. So the customer, when moving from white line chipboard to our folded boxboard actually can buy 40% to 50% less tonnes and get the same or better package, lighter package. So we are -- it's not only about the cartonboard segment as such. It's also to look beyond.

And we have lots of similar examples, for instance, in the U.S. to replace SBS with this folded boxboard where we produce the board in several layers with different types of fibers and microfibers and so forth to really get that bulk stiffness with significantly lower basis weight. So we are quite optimistic about the strength of our product offering and how we will be able and how we are able to penetrate the market and gain market share.

And that is actually what we have been doing throughout this year. Compare us with competition, we have been growing. And most of our competitors are shrinking. And that comes from competitiveness, not only cost competitiveness, but quality competitiveness, customer focus, working closely with customers. I truly believe we have a clear competitive advantage here. We will continue to build on that.

And I will take one question from the webcast in the meantime. So how much of the current market weakness do you think ballpark is due to weak cycle? And how much, call it, structural as the industry has expanded capacity too much?

It's -- I mean we are -- it's a cyclical industry. I've been 35 years in the pulp paper forest industry. And this is -- these kinds of situations are always there. And because it is cyclical, demand is cyclical. And every now and then, there can be in some segments, some overcapacity. Then at some point, it melts around away. And you need to look at the longer term. And we strongly believe that we have the assets, the very cost-competitive, well-invested assets. We have the very attractive product offering. We have what it takes to be a winner and to continue. And it's not about anything new here. It's really about continuing what we have been doing throughout the last 10 years. We have been growing our packaging business more than 5% per year. And now we are saying that we are going to grow 4% per year.

Earlier the last decade, we have grown roughly double the growth rates of the market. And now we say, with all the plastic substitution and what is forecasted when it comes to migration from plastics to renewable materials, we are going to grow 4% instead of perhaps a 3% market growth. So we truly believe that we have what it takes to grow this company and to expand our margins at the same time.

[ Johannes Gasilis ] here, SB1 Markets, Stockholm. I'm a bit curious about what you revealed here today regarding own actions, EUR 500 million, EUR 700 million step-up. And you mentioned there are [ more ] sources, variable cost, fixed cost, commercial excellence and so forth. Could you kind of indicate how much of this benefit is fixed cost? And also if you can mention the time frame, are you talking about years? Or is it more 1, 2 years here?

So it's a fairly balanced without going into exact percentages here, but it's fairly balanced between operational, so working in the mills, many of the examples Hans mentioned. Within sourcing, there's a significant potential. This is one area I'm super excited about. We have our new sourcing head actually joining next week, and we will grab this head on. And it's not like we haven't done anything, but there's a lot still to do in sourcing. On the commercial side, mix driving, mix points, that's, of course, pricing.

And then, as you say, fixed costs. Fixed costs, we are working on as we speak. We had -- personnel was affected here the last -- has been affected the last couple of weeks. And even if that's not a particularly nice thing, it's a must to-do thing, and that will actually continue also during next year. So I would say, without giving you an exact answer, fairly balanced. And then on how quickly -- I mean we will do this as quickly. We will really push for it. I mean the time frame we gave here now is a couple of years. So call it, 2 years or so, 2 to 3 years.

The previous fixed cost FTE reduction, we could do like through just doing more with less. But one of the drivers for the organizational change as from the 1st of July was that we realized that to take the next step in fixed cost reduction, we need to work in a new way. We need to reorganize the way how we are working our processes and so forth. And that is now what we are carrying on. We haven't made like one big announcement like some other in the marketplace, but you have read throughout the autumn here, you have read news from all our mills about collaboration negotiations, reductions and so forth. And this continues in every part of our organization.

Now you have invested in growth now, as you showed quite a lot of money several years. And now you drive down that CapEx to '26. I think Niclas said less than EUR 600 million. [indiscernible] a company do that, they have one year lower CapEx, and then they go back to the higher CapEx. How should we look at '27, '28? Is this a little bit of a longer sort of pause in growth investments? Or is it just one year sort of breather?

It's not one year only. I mean we are -- again, how we allocate capital, we are renewing that, we are strengthening our scrutiny, making sure that the returns are there. So without giving an exact figure for '27, '28, but you should see this as a bit of a continuation rather than a one-off.

It seems to me that of the new financial targets, probably the net debt-to-EBITDA target is the one with the greatest impact in the immediate near term, however, and I'm a bit curious just to understand, and I think it said on your last slide, Niclas, that you said it's within a 2-year time frame. And I'm curious to hear how much of this leverage reduction is actually the net debt level?

And how will that come down? how much of that will be put into the first company? How much is relating to potential divestment and other sources if we assume that the EBITDA level is stable at the current level?

Yes. And you're absolutely right. The assumption, and that's, by the way, for these targets overall, the assumption is that these are Stora Enso long-term targets with ForestCo moving into its own company. So that's the kind of basis for the targets. And thus, of course, there is an assumption that a portion of the debt or the debt is being split in a sensible way and a portion of the debt is carried by the forest company and Stora Enso is left with less debt than if we wouldn't have done the demerger. The exact amount is something that we'll come back to. Of course, we have thoughts. We have plans, but we don't want to give you an exact number now, which then a month or two months later is slightly different.

I mean this is actually one important thing with the demerger is the tax efficiency or tax-free demerger kind of typical way how they are done in Sweden and Finland. And this we want to safeguard. And one of the things that are required to do it as a tax-free demerger is a certain split of the balance sheet and so there's certain tax rules governing that how much debt can you put on one side or the other.

So it's not completely kind of just up to us to make up a number. But what's important, what we've said all along from the very get-go in the summer when we announced this, is that we are determined to create two strong companies. So -- and this goes for debt as well. So there will be a suitable amount of debt in both companies.

So we are not going to kind of favor one part or the other. So two strong companies, investment grade -- strong investment-grade companies.

I will take in between one question from the webcast as well. So this is once again also about the forest. With a new completely independent pure play, how will the forest strategy change as profitability is the main goal or rather than providing cheap and quick [pulpwood] for the mother company?

Yes. I mean it's all about business focus. We're looking for -- we have this asset, how can we maximize the value and how can we accelerate the value appreciation, so there will be much more focus on the new revenue streams through the focus, and we are convinced we have seen it already throughout the process. The work with Tuomas and his team that actually when they look at this as a company to be listed, there are new aspects coming into it, new ways of accelerating value appreciation and income.

I just want to go back to capital allocation again. So I appreciate that for the next few years, your, I suppose, harvesting, deleveraging but to achieve that above market growth rate in the very long run, what are some of the portfolio tweaks and portfolio reinvestment plans that you have sort of on the shelf, so to speak, that you need to look at longer term for the business?

Yes. Well, we don't have any immediate big investment plans. We have some ideas how we can improve the cost competitiveness of some of our mega sites, the key mills as we have them classified. So that's something we are looking into. And then we will continue to invest even more than before in customer-centric innovation, product development. This year, 60% of our paperboard sales comes from new products. We want to accelerate that even further because we see the added value and we see how we can win with customers through new innovative products that are, for instance, offering a 40%, 50% yield advantage or that can help customers to reduce their carbon footprint 70%. So this is a really important part of our winning with the customer strategy.

What is your expectation for the net carbon footprint of the operating company once you have sold the Forest assets?

Yes. So we are reporting our CO2 emissions. And we have a target to be carbon neutral by 2040. And we have said that we want to reach minus 50% CO2 reduction -- emission reduction by 2030 compared to 2019 as the base year. Now as you probably have seen from our Q3 report, we are already at minus 60% in Scope 1 and 2, and we are at minus 39% in Scope 3 so we have basically reached that 2030 target already. This Scope 1 and 2, this CO2 emission reduction is really from our total supply chain so it doesn't include the benefit we have from our forests. It doesn't include the 40 million tonnes by replacing nonrenewable materials with renewable materials.

So it's really what is coming from our mills, logistics, food transport to the mills, mills product transported to customers. And we have great examples. For instance, our Oulu mill is nearly carbon-neutral we have managed to take down carbon emissions by 90% in this unit. So the forest divestment, first of all, and then the demerger of forest doesn't affect this. It's only the supply chain CO2 emissions.

Hans, I'd just like your thoughts on why you included the 4% per annum top line growth target? Because if I think about the industry historically, I think companies, analysts, consultants, we all overestimated demand added too much capacity to the industry. And there's a lot of latent capacity in the industry that needs to be utilized and I imagine, near term, your focus has got to be returns and profitability.

So how does the top line growth number impact your decision and the divisional management decisions to make sure that they're not incentivized at capacity when they should be utilizing what they've got available to make sure that you're driving returns rather than focusing on a top line rather than value accretive growth rather than just sales growth?

I do agree with you. I mean, our main objective is really to generate profits. That's the key thing. But actually, growing top line also drives improvements in EBIT. And my view on looking at the value of a certain company includes the top line development growth. Growth is important.

And as I said, last 10 years, packaging, over 5% growth in Stora Enso. We have demonstrated our strengths and capabilities, and we are going to continue on that path. So if you really want to maximize the value of your company. You need to demonstrate over the market growth rates, which are also driving improved EBIT margins which are also driving a higher EBIT or EBITDA multiple in terms of valuation. And therefore, growth is important. But of course, it's all there in order to improve our bottom line profits. And 10% EBIT margin of a bigger turnover is much more than 10% of a smaller top line. So I think the mathematics works, both in terms of driving EBIT improvement as well as driving the valuation of the company, demonstrating that continued growth and margin expansion at the same time.

But just to add to that. So again, repeating what we've said. I mean, we have what it takes to grow is about 4%. I mean, yes, maybe not for the next 20 years. But for here and now and the next number of years, we have what it takes. So this 4% or above 4% target is not driving CapEx, for instance. We have what it takes.

Niclas, you mentioned complexity as one of the challenges you're addressing that with the strategic review of the European sawmills. Could you talk a little bit about that topic? How do you see it? How much you can achieve with these potential actions and whether there's further to go? Is this like a startup a journey? Or are these planned actions already enough?

Well, it's really all about this -- how you drive efficiencies in our company because on the first of July, we reorganized so that the pulp and board mills and the nearby sawmills, which are actually synergistic and supporting the board making, which is the core our activities. So they are reorganized into business units, P&L responsible business units. And that's why the northern sawmills, they are now each part of a business unit, board and pulp business unit.

And these Central European sawmills and CLT plants, there are 7 sites. They are not Synergistic with our core business. So as they say, first come strategy, then comes structure, and that's what we have done, basically, this is an attractive totality in any case. So also with international distribution units in U.S.A., Australia and so forth. So we are sure that there will also be a lot of interest getting into this, getting a world-leading position in cross-laminated timber, but it's a very different business. And therefore, also here, we built Stora Enso around the core, which is really renewable packaging. That's where our strengths are, and that's where we have invested. That's where we have grown during the last decade, and that's where we are going to continue to grow.

But we don't have any further plans. I think with this, we are quite focused as a renewable materials company with strong and increasing packaging focus.

So a question on your revenue growth target of 4% and the confidence that you will probably continue to outperform the market, which I think you said will grow around 3%. So what gives you that confidence given that you are now going to focus lesser on growth CapEx? Or is it more like substitution from more substitution from plastic, from other paper grades, new customers, new geographies? So can you just elaborate on what gives you that confidence to gain more market share in the near term?

Yes. Well, first of all, we are continuing on what we have done before during the last 10 years, 5% growth. We have extremely well-invested competitive asset base. We have the most compelling to broadest product offering. We see that we can gain new customers, new business through our product development like the example with the pizza boxes getting business from white line chipboard moving to our folded boxboard and the customer saves money because he can buy 40% to 50% less volume and still get better properties to the box.

So it's really through innovation and product development to expand the whole addressable market and have to develop new businesses and new relationships.

So looking at that 4% growth, looking at how well invested we are, how much capacity we have how much state of the art technology we have, what kind of a product offering we have, global reach, customers operating in 60 countries, I think it's a relatively still conservative target as such.

And we are going to have one of the last questions now and then wrapping up soon, but go ahead.

A question on the Forest demerger, it seems like three questions, but just one question. On the demerger, it's 100% to Stora shareholders that you're envisaging. You're not going to keep any 20%? And if not, why don't you just sell 1 billion or 200 million hectares again and get to your 1x net debt to EBITDA and have one less target, less to worry about, why are you still kind of preempting that?

And you also said that it's going to be tax-free for Stora but it will be tax-free to our shareholders as well because if you were to say to Germany, you'll have a dividend tax. Are you thinking about that in terms of structuring the transaction?

Yes. No, good question. And yes, just to be clear, when we talk about a demerger spin-off listing. It is a 100% distribution to our current shareholders or at that time, shareholders. So as a shareholder, instead of owning one Stora Enso share after the demerger has happened. I own two shares, I own a Forest company share and a Stora Enso share. And that distribution when we talk about tax free or tax efficient at least, maybe that's a better term. That's from a shareholder perspective, also a company but shareholder perspective, that's what I was kind of referring to.

And of course, you are right that it depends a bit in which jurisdiction you are. So I cannot promise tax free for everyone. It depends on where you are, but looking at past similar transactions, it's tax-free is an important aspect from a shareholder perspective.

Then on to kind of the why don't you sell 1 billion or 2 billion or 3 billion or 5 billion. I mean, we are not doing this transaction to delever. We are doing this transaction because we truly believe it will create value, it will create value for the shareholders and it will create value for the two companies.

I mean, yes, then the debt will be split and again, we'll come back to the exact kind of amounts. But the driver for this is to create two strong companies, which are actually better than the combined ones from a shareholder perspective. But also from an operational perspective, both from a more focused Stora Enso. I was referring to the complexity. This will be a more focused Stora Enso industrial company. And with all the good things, the Forest company can do, having that independence that public scrutiny all the new opportunities and so on. So that's the main driver rather than just selling 1 billion and deleveraging.

So thank you, first of all, to you guys, but also to the great questions you send both via the webcast and in here. We will now have a break, and we can continue these discussions during the break, and we will continue at 11:15. So with the webcast listeners as well, please, will join us then. But with these words, thank you very much.

[Break]

Welcome back, everyone. I hope you had a refreshing break. As we continue on today's agenda, I'm pleased to introduce our next session, our business overviews. Joining us for the session is Andreas Birmoser, Carolyn Wagner, and Johanna Hagelberg who will each share key insights and updates from their respective areas. Please join me in welcoming our business leaders to the stage as we dive into the next part of the program.

[Presentation]

All right. Good morning, everyone. My name is Andreas Birmoser, and I'm heading the business area Cartonboard. Yesterday evening, I got a few questions, where I come from what I've been doing. So a few facts about myself.

I've been with the company for over 20 years. I joined back in Brazil, my home country, the first 10 years I spent in various finance roles, greenfield investments, production units, headquarters as well as a business area. And then for the last 10 years, I decided to move away from finance and have been leading business development, innovation, one joint venture in Brazil packaging material sales until I got to the position I am today, which I've been holding for two years now, leading business-era cartonboards.

And today, I'm not here to talk only about cartonboards, I want to talk about the whole consumer packaging business. Which includes liquid packaging board and food service board. This is our most important growth engine in the company, as Hans has already introduced before. And I want to show you how we shape our strategies around consumer demands, customer needs and how that will drive our growth moving forward and how that will help our value generation.

And I hope that by the end of this presentation, you will see the same thing I see: that we are the best positioned in this industry to succeed and benefit from that growth. So let me get started.

Hans mentioned about our strong positions. We are the European leaders in cartonboard production and food service board, and we are the global leader in liquid packaging Board. We are the company with the biggest and widest portfolio in consumer packaging. And that has a lot of benefits. I will highlight a few of them.

The first and most important one is probably the insight we get from different customers from beverages and food and how we translate that to innovation. Like barriers, a lot of needs to develop barriers in food service and liquid packaging, but that can also spill over to cartonboards. A good example is dispersion coating. So there is a value in having a wide portfolio.

And then we deal with many blue-chip customers, not only converters, but also brands. So we have here Tetra Pak, SIG, Elopak, with whom we have been dealing for over 60 years. But we also have brands like Nestle, ABI, which provides us valuable insight from the market and the consumers. And that helps us. We need those three parties to really develop the products, develop the materials to find the best solutions. And that's very important.

So as Hans said, this is a growing market, and let's start by looking to some of the numbers. Here on this chart, on the left-hand side, you will see the global projections of growth. And on the right-hand side, the European projections of growth. You will see that in both cases, virgin materials has a higher growth rate than recycled board. 1%, 1.5% will be driven by plastic substitution. That is a very important growth factor there.

You also see on the European side, there is a temporary contraction of demand currently that has been spoken for before. So we have an overcapacity of 800,000 million tons in cartonboards, but you also see that the growth towards 2030 is over 1 million tons. So that is a growing market.

But of course, we have now an overcapacity, which we will have to navigate through. And in order to succeed in such an environment, in my opinion, you need three things. You need to have a very strong cost position. You need to have entry barriers and you need to have the best product and services.

So those three things are crucial. And I want to talk about those three things in my coming slides.

I will start with our cost position. Again, on the left-hand side, you have the cost curve of folding boxboard. And on the right-hand side, you have the cost curve of the liquid packaging board. Here, on FBB, you will see that we have around 70% of our capacity in the first and second quartile of the cross supply curve.

While 100% of our capacity in liquid Packaging Board is in those quartiles. No other European producer has that high share of its capacity in that cost position. And that's going to be very important for our value creation.

But there are other two things which are important in this slide. One is if you look at how much volume is more costly than our most costly machine, which is our smallest machine in Forest PM2 is over 1 million tons. So you have 1 million tons more expensive than our most costly machine. Market is growing over 1 million tons in the next 4 years. So that is -- how you need to play this out.

And Hans spoke about our value creation program. How do we continuously improve with the sprints where we have our experts and operations and sales joining our mills, joining our sales offices for weeks to just lift ideas. And then we have the PMO structure to make sure we execute a weekly cadence where we review the products. I'm personally involved in those weekly meetings.

We removed the obstacles, we deep dive where we have to deep dive to make sure we make progress. And with that, we have been shifting our cost position every day, and that is very important. And as I said, we do it based on data. We leave emotions out. As you've heard, I come from finance, so I listened to data. That's what I do. And I think that's the right thing to do in this scenario. So that's going to be very important.

So I spoke about cost, then entry barriers. Let me talk about the four most important entry barriers. Hans mentioned the huge issue that is food waste. And therefore, the barriers to protect food are very, very important. We need to help to find the right solutions there. And here, again, benefiting from our wide portfolio. We have been innovating and developing a lot of solutions. We probably have the widest barrier offering in the market. And that is not something you come in and copy very easily. This takes years to develop.

Then our customer's trust. Trust is only built by repetitive steps, repetitive successes over a long period of time and that is then translated into two things. With many of our customers, we have long-term contracts, 2 to 4 years. What benefit does this bring? Predictability, certain price stability as well but most importantly, it makes it difficult for others to come and enter. You don't copy that.

And then there is the long lead times to really qualify this. The qualification process is very demanding. Sometimes it takes 6 to 12 months to qualify a new product. So again, if you come from the outset in and you want to play in the food and beverage industry, it's not going to happen that easily.

And of course, fourth but not -- last but not least, you have the high CapEx. It's not only about building an asset, right? We just invested in a new machine in Oulu, EUR 1 billion year investment. You need to have the whole environment around you with forests, harvesting, transportation. It's not something you copy that easy.

So with all those things, it's going to be very difficult to see more capacity coming in Europe in the next years. So we have invested while there was a window to invest and now we can benefit from that growth.

So I spoke about cost entry barriers. Let's look into products. Here, you will see on the bottom side of the charts that renewable fibers of fiber-based packaging has a growth rate which is twice as big as plastic packaging. So a lot of the growth will come from plastic replacement, especially in Europe. Europe is driving most of that because here is where the legislation is more advanced and PPWR, SUPD, you name it.

And it's going to kick in really strong now in 2030. So that is driving a lot of the growth. So then you need to have the right products. And I spoke about barriers and how we develop them together with our customers.

One good example is ultra thin PE. If you think about those drinking cups, we have managed to keep the plastic content all under 5% by having very thin layers of PE. So it's compliant with legislation and it opens a market for us because we will be there with a solution that works. Others probably don't. And that's going to be very important.

Then another important topic is lightweighting. Why is lightweighting important? You need to do more with less. If you want to replace plastic, it's not just going to happen because we wanted to be renewable. It needs to be cost competitive. It needs to work in the thinning lines. And for that, lightweighting is a great tool because you can do more of plastic, you can remove costs not only for materials but also from logistics.

And here, I will give you now a few examples from our new machine in Oulu. So if you look at our -- what do we do for our folding boxboard in the new machine in Oulu? We have our patented technology called FiberLight Tec, where we introduced microfibrillated cellulose on the mid-ply of the board, and that increases its stiffness and resistance. And that gives us up to 8% yield advantage. It sounds like not much, but it is a lot. It saves a lot of cost in the process. If you compare, for example, our folding boxboard from Oulu to the North American SBS, we are up to 18% more efficient in yield.

And not only that, we have a 50% lower CO2 footprint even landed in the U.S. And that's because of the energy metrics we use in our mills and how we transport it to North America. So that resonates a lot with the brands, which are ultimately the ones which are deciding what to use. We actually help them to achieve their targets. And that's why we have been increasing our efforts in talking directly to brands and retailers and not only the converters. We need those three parties involved in that change.

Then another interesting aspect, and Hans has this good habit of stealing many of my lines. He does it over and over again. But he talked about pizza boxes, right? And he mentioned that the white lined chipboard market is a EUR 3 million tonne market. If you take Oulu and our products in Oulu and you convert it instead of looking at cost per ton and look at cost per square meter or cost per box, the products from Oulu will be positioned in the first quartile of the cost supply curve of white lined chipboard. Why is that? We can achieve up to 40% to 50% yield advantage compared to white lined chipboard.

So I'll ask my colleagues to circulate now some of those samples, so you can see it with your own eyes. That one specifically. This one is -- you all have seen that frozen pizza boxes, white lined chipboard material. This one developed based on our own products, 37% lighter, wide insight. This one is gray insight, better printing surface, better printability, better runability in the machines.

White lined chip material, you stopped at converting in the printing line every x hours, hours once for a full day. So you bring a lot of efficiency to the process. So that is a market which now with our investments and our cost position in Oulu, which is now addressable for us. So we don't only compare virgin to virgin, but we will also replace white lined chipboard.

And back to the U.S., I mean, yes, tariffs are there. We haven't seen the end game. But again, with our yield advantage and with our value proposition on CO2. We have seen that our customers, they are willing to talk and willing to share that with us. And why is that? If you think about it, put yourself in the roles of a converter in the U.S. or a brand in the U.S. and you say, that's all the Europeans get out of the U.S. because of the tariffs, what happens, you shift all the power through the hands of the [indiscernible] that you have the two big players, which have 80%, 90%.

I guess you all know what happens to price in that scenario. So that understanding is there, and we see that the customers are willing to talk to us. But -- so with that solution with those boards, we will be able to compete not only with white lined chipboard, but also with plastics.

You all travel, you all go to supermarkets, right? So think about how much plastic you see where plastic is not needed. A few examples. Here, you have the 6 cans or 12 kinds of beverages, beer, soda, drinks. In the past, all wrapped in shrink films.

Now you start seeing them in boxes or with handles made out of cardboard. But think about tomatoes or vegetables, how much of the trades are plastic and you ask you say why plastic. There's no good reason or the trades on biscuits. These are just a few examples. And those changes are silently happening, and it will continues to happen especially now towards 2030 when legislation is kicking in. So hopefully, that gives you a bit of a glimpse that we have the right products and the right solutions and the strong cost position to fight this environment we are in right now.

So then talking about the machine in Oulu, EUR 1 billion investment, 750,000 tonnes of capacity. It's a swing mill. It will produce folding boxboard, but will also produce CUK or CKD, as we call it. And that is a beauty in itself. Why is that? Two main things. We have designed and developed Oulu based on the existing SKUs we have in Skutskar in Sweden or Fors in Sweden.

That gives us a security supply increase for our customers. And they are really, really looking after that, especially of everything that has happened over the last years, strikes, shutdowns, you name it. So they wanted increased security supply, we can provide it now. But it also has another interesting aspect, which is this interchangeability means we will not grow 750,000 tonnes in cartonboard. We will be moving products from our existing mills like Skutskar to Oulu or Fors to Oulu and that is roughly 150,000 to 200,000 tonnes in the coming years. So Oulu allows us to debottleneck the whole portfolio. You can grow in liquid packaging by removing products from Skutskar.

You can grow in food service board by moving folding boxboard from Imatra. And that allows us to play and reduce the risk of being exposed only to one grade. And that is another important aspect to keep in mind.

So to finalize or not to finalize, but to talk about value creation first, we want to achieve over 10% EBIT, and we are confident we can do that. 30% or 40% of that growth will be coming from structural changes, meaning the ramp-up of Oulu and the other 60% of own actions. Hans mentioned a few of them. We have replaced the outer price in Fors with eucalyptus pulp generating EUR 6 million in savings.

Imatra, where we are running more efficiently our energy setup, another EUR 6 million. We have changed the recipes with blue chip customers, and that will have an uplift of 1% EBIT margin. And then we have, in this lower volume scenario, this overcapacity scenario, we can allocate the products to the lowest cost asset for time being, which is another great value creation visibility. So what I'm trying to say is there is no silver bullet. It's this new ways of working, it's this new mentality that we have and that we continue to push.

We listen to data, we lift ideas and we make sure we execute them. I have one machine and 1 million hour in my business area where we have got over 10% of cost in the last 18 months. So it's possible. We have done it. We have proven that we can do it.

Good. Then to finalize. This is a growing market. It's growing organically. It's growing from plastic substitution, and now we are capable of also replacing the recycled board. So it's a growing market. We have the right products. We have the right services we have the right cost position to navigate through those times, but most importantly, we have the trust of our customers. As the examples I've given some of them have been dealing with us for over 60 years.

So with that and our new mindset of new ways of working to continuously look for improvement of never being satisfied of always looking to be more ambitious. We are convinced that we will be achieving those targets in the next 2 to 3 years.

And with that, I pause here, and I invite my colleague, Carolyn on stage.

[Presentation]

Good morning, ladies and gentlemen, and I've spotted some ladies in the audience. Welcome I'm Carolyn Wagner, and I'm heading up the business area, packaging solutions for Stora Enso. To begin with, I want to share a personal secret with you. I love packaging. As a packaging engineer, I should. And hopefully, today, I can transmit my enthusiasm also to you as we go through the segment containerboard and packaging solutions.

Now we have a lot to gain from where we stand today. I am convinced that we can drive growth and a meaningful EBIT margin uplift through our own actions. We will shift our portfolio to higher margin products. We will integrate containerboard and packaging solutions for growth. And we will scale up our automation and service offering. These actions will make a significant impact to our performance over the next 2 to 4 years.

When you think about packaging, have you ever wondered what is so special about a box? Today, I want to show you how Stora Enso can turn a box into tangible shareholder value through technology insight and customer intimacy. Let us start from our strength.

Stora Enso is a leading producer of virgin fiber containerboard, complemented by a very competitive recycled offering. We are also a top-tier integrated company, but mainly across Northern and Central Europe, and we serve demanding customers, brand owners who value our quality, our reliability and also our innovation. 80% of our sales is in Europe, but we are really a global supplier.

So we expand specifically in virgin containerboard also into North and Latin America. This gives us both resilience and profitable growth opportunities beyond Europe.

What are the markets in which we operate? The structural demand in our markets is intact. We expect the global virgin containerboard markets to grow by about 1% year-on-year through to 2035. And soon to exceed capacity, and that is good news for Stora Enso. With recent mill closures in North America, we European suppliers have a golden opportunity to gain global market share. And also European box shipments are steadily increasing, especially in Eastern Europe. And this is a very strong fit with our integrated footprint.

At this point, I would like to share our three strategic levers which will help us win in this competitive market environment. Firstly, our low-weight kraftliner; Secondly, our footprint advantage; and thirdly, the expansion of the value chain. Let us start with our superior innovative lightweight, kraftliner. It's a unique product from Stora Enso.

Now packaging sits at an intersection of two mega trends. Firstly, it is the shift from plastic to paper and secondly, the push for lighter, lower carbon materials. This also drives corrugated demand in our target segments. This is where our superior lightweight kraftliner comes into play. It offers better strength values and lower specific [gavage].

For our customers, this actually means 10% to 15% less material up to 20% lower CO2 footprint and a better box performance. And this is important for our customers. Because most international brand owners, they have made a promise to you, to us, to the consumers. They have made a sustainability promise to us, and now they have to deliver on it. Now Stora Enso can help them reach their targets.

And if we were to follow Andreas to the supermarket, we would also see that the boxes perform on shelf. Now what does perform mean? They are strong and they just look good. And with this, they also enhance brand perception which is also very important for our brand owner customers.

Let's move on to the second lever, our integrated footprint. Now our footprint is a real differentiator. By co-locating containerboard mills and corrugated plants, we have integrated an efficient vertically integrated system. This actually minimizes transport, thus also reducing logistics costs and again, lowers the carbon footprint.

Now our containerboard mill in Ostroleka. It's a recycled containerboard mill and it operates in the lowest cost quartile. And it's ideally situated to our own corrugated plants. Actually, it sits on the same premises as our biggest corrugated plant in Poland, but also very close to our Baltics operations.

With this, it's obvious to all of you that this creates a cost advantage if we compare to competitors. A cost advantage per tonne at the same time, giving us higher service flexibility. This allows us to grow and at the same time, it allows us also to protect our margins. What else does the integrated model do for us?

Well, it is actually a natural hedge against market volatility. Because we have easy access to paper, we can optimize the capacity usage in the paper mill, and we can balance demand and supply across the cycle. Our third strategic lever, the expansion of the value chain.

Now we don't sell paper. We don't sell boxes. We provide packaging solutions. This end-to-end system, this is actually what we're targeting. We want to be a packaging solutions provider for our customers where design, data and automation connect seamlessly. And the success of our award-winning packaging solutions that's also a very good selling argument for external containerboard customers. So again, we see and we can underline the importance of integration for the success in our business.

So if we recap, what are the three strategic levers which will help us win. It's our low weight Kraftliner with higher strength property at lower CO2 emissions. It is our footprint advantage, which gives us a lower cost position and better proximity to our markets, and it is the value chain expansion, which creates value for our customers. Those three together allow us to grow even in stagnant markets.

Let's move on to something that really excites me as an engineer, automation. Look at this great case from Lumene. Lumene is a high-quality finished cosmetics producers. And if you were to ask Lumene what packaging is for them. They would actually say it is nothing short of a growth engine. With our wraparound packaging machine, we have actually replaced manual packing processes for 40 different products. And this has increased efficiency. It has increased reliability and it has also increased sustainability.

You don't believe the success they have with this packaging line, really. It's great. Because they have now been able to expand their e-commerce business internationally that even deliver as far as China. And that is what automation did for them. And for us, the customers who actually buy automation lines from us, they're typically 30% to 40% more profitable than ordinary packaging customers. How can that be possible?

It is possible because every installation actually deepens the customer relationship. It anchors both paper and box sales and it also gives us the opportunity to continue with further products with further lines and also with aftersales turnover. So this is really the story, I believe in. So -- and if you really want to see expansion of the value chain, in practice, I would like to invite you to go to IKEA.

Maybe not on a Saturday afternoon like I did. But in the IKEA, you will see a lot of Stora Enso products. You will see Stora Enso containerboard and you will also see Stora Enso corrugated boxes. And then if at the end, just before the exit, you can't resist those Swedish cookies, you will again meet Stora Enso packaging material packed probably in Stora Enso corrugated cases by a Stora Enso automation line. I have to admit we don't make the cookies.

So what are all these endeavors leading to? Of course, our goal is to grow EBIT margins significantly and become a more profitable business also in integrated packaging. For one thing, we will do this through structural changes. Our major packaging site in De Lier will be ramped up to its optimal capacity.

And secondly, we will do this through our own actions. We heard about our own actions also from the other presenters. So these are things that we control ourselves. Of course, again, we go from the technology, which means we will improve wood yield, fiber yield in our containerboard production, but also, we will improve our performance, our productivity in the corrugated plants.

And of course, we will take commercial actions. We have now discussed in the questions, how are you going to grow above the market? Well, I believe that actually we can grow above the market because it's all about performance and customer trust, as you've also heard from my colleagues. And this is also very, very true. So we will also be much more customer-driven, customer oriented in our corrugated plants and thus, we will be able to grow above the market. And we're not waiting for the market to recover. We're not waiting for the markets to turn. We will turn it ourselves.

To conclude, I believe that integrated packaging can be a real growth platform for Stora Enso. We unlock this potential by technology, circularity and customer trust. We have leading assets also in containerboard and packaging solutions. We have really unique products, and we have a partner relationship with our customers, which is unrivaled. So I believe that we will actually also play a winning game because I believe that with every box, and with every customer, with every consumer, we make life a little bit better and a little bit more sustainable each and every day.

I believe from Chinese New Year, beautiful box from China through to Christmas Eve, every box is special. Thank you.

[Presentation]

So we are the renewable materials company with a strong focus on packaging, but to make excellent packaging, you need pulp. And that's where we come in. We are serving demanding customers with specialized pulp as well as new biomaterials. And I'm Johanna Hagelberg leading the biomaterials business area.

I will talk about three things: our portfolio, both in pulp business, as well as in the new biomaterials. I will talk about the market, and I will talk about our clear actions to improve margins. Let's start with pulp. We produce pulp for everyday life. You wake up with pulp, you live with pulp throughout the day, and you go to bed with pulp, from cradle to grave.

The eucalyptus pulp is going into packaging, with our packaging business area sisters. It also goes into specialty applications and to tissue and growing into hygiene. Then we have the fluff pulp, which naturally goes into hygiene, all sorts of grades in hygiene, and both of these two have clear -- offering clear competitiveness and sustainability to our customers. And then thirdly, unbleached kraft pulp, where we actually are the largest in the world, and I will come back both to the fluff and to the unbleached.

This is serving our packaging business with natural-looking grades, natural-looking packaging appearance, but also new areas like electrotechnical underpinning the electrification that we are going through. Also water purification with filtration and supporting the construction sector with fiber cement. So that is our portfolio. And this portfolio is already today at the low of the market, delivering 10% EBIT margin.

Moving to the market then. We believe that the pulp market is healthy growing over time. In the core of the market, we have eucalyptus in the base, we have softwood. And then we have two very attractive growing segments, specialized pulp, which is the fluff pulp going into hygiene and demand driven by urbanization, driven by aging population across all nations, as well as the higher penetration of fem care, as well as baby in developing markets.

Now we have the unbleached specialized area as well, which is growing based on packaging and the wish for more natural looking packaging, but also, as I said, the electrification with needs for more cables, more transformers across the globe. So we believe that this market then can offer another $10 billion roughly in additional revenue possibility, as well as then an increased demand of pulp.

So diving into eucalyptus, and you heard Marcio talk about the actions we've been doing at Veracel to improve our plantations and our genetic material, the trees. Our eucalyptus is significant contributor to Stora Enso and to our packaging sisters profitability. They are underpinning the packaging BAs. Why? Because Veracel and MDP are two of the most competitive modern production facilities in the world in producing eucalyptus pulp. They offer $150 to $180 competitive advantage versus the average cost curve landed in Europe.

Not only is the operation of producing pulp very efficient and continuously aiming for even lower cash costs maintaining our position, it's also based on highly sustainable plantations where we are owning around 400,000 hectares divided between Brazil and Uruguay. And these plantations are based on nurseries where we are aiming to improve every tree, new tree we plant are a little bit better than the previous one.

And I'm just back from the Climate Conference in Belem. And there, we have showcased thirdly, on this bullet here, the third bullet. Our strong license operate in Veracel and MDP. We have had panels around resilient communities because it's fundamental for us that the communities around the sites, which are, of course, consisting of employees, providing income but also developing the communities in terms of resilience, increased income on average, education, land to live on has been fundamental. So climate -- resilient communities and climate resilient communities have been one of the showcases.

Second showcase we've had at the Climate Conference have been around reforestation. And in both Veracel and MDP, we have set aside almost half of our area to continue to preserve nature and reforestate. And then thirdly, last but not least, biodiversity to enable better fauna and flora and both maintain but also increase fauna and flora, where that's needed. And these very unique eucalyptus producing companies that we have are then really helping with integration benefits.

So we are the only EU peer in packaging, like you heard Hans talk about that have this possibility with own integration. And why is that better than just buying euca on the market? The reason is that we can supply consistent, sustainable eucalyptus to our very important customers in packaging which means that this gives a perfect optimized fiber mix. The perfect optimized fiber mix gives process stability. Process stability gives stability of the quality of the Board for our high-end brand customers.

So this is not only though advantageous for our packaging sisters. This is also super good for biomaterials business area because the integration offers us base demand regardless of the pulp cycle, meaning that we are less dependent on volatile spot markets as a business area and company.

Now I talked a lot about eucalyptus, and I promised to come back to the specialized rates. Here, we have two grades that we are absolutely uniquely positioned in. Fluff, we are the largest producer in Europe. And we are basically the only significant producer in Europe. The rest of the pulp -- fluff pulp in Europe is imported. And we are long term in this business. We've been here for over 50 years. And that is important in fluff because this is a highly technical grade with very narrow spec and it's next to skin. So it needs to be super safe and clean.

And as a curiosity, could you guess what the first grade was called because we started in 1969 with fluff. Revolutionary name, Stora 69. Here, our customers are today appreciating us for high sustainability, the high quality, but also our possibility to innovate and develop the fluff pulp according to their needs.

Moving from fluff then over to our unbleached grade, where the latest addition is the UKP Nova as we call it. Here, the Nova or unbleached as such offers 30% less carbon footprint, simply due to less need for bleaching chemicals. And my dream would be that all pulp would be less bleached. This is helpful in our packaging business, so we're already supplying Oulu, Beihai and Skoghall with UKP to support their sustainably looking packaging.

And in addition to that, we have a growing new customer base within electrotechnical and electrification. And here, I have some product samples because when I heard about this, I said, God on earth, what are you using that pulp for in the electrotechnical space? And I'm an engineer, so I'm somehow familiar to electrotechnical stuff. So we are pressing around here two pieces of board. Are they coming on that side as well? Yes, perfectly. There they are.

One of them, the thinner one, that is what is a pulp sheet looks like out of production. So that is a base UKP pulp sheet. The other one that when you take a look at it, I believe you will go to the construction store to buy. That is actually high dense UKP. And when you open up a transformer, you see more of that than the rest because everything needs to be insulated, isolated when it comes to electrotechnical applications. So this is a fantastic application supporting then the electrification and the reason why our UKP, so unique is due to its high cleanliness and then the very good quality.

So we are working here with new brand owners that are then supporting the growing electrification across the globe. But it's not only good for electrification. It's also good for water filtration, simplest application. I'm not sure we think it's simplest, but the simplest application, coffee filter. But then much more advanced purification of air in carts, water purification, of course, large scale as we need clean water every day -- for everyday life across the globe.

Okay. I've talked now a lot about pulp portfolio, and I talked about the market for pulp. What about the new bio materials? With the new biomaterials, we have concentrated our portfolio to three areas: all of these are strategically fitting being wood-based and they offer significant value creation into the future. The first one is the biochemicals.

The biochemicals is already an established business with the crude tile oil and turpentine replacing fossil-based chemicals and fuel. Here, we have also added the lignin business where we are offering nature's glue as that is what lignin does in a tree. It makes sure that the tree can grow higher than 20 centimeters. Without lignin no plant would be higher than roughly 20 centimeters. So it's the lignin that lose the fiber together. And we are offering nature's glue but also binders -- sorry, in binders for dye, so color clothing of clothes, colors of clothes. Without binders in the dyes, your all colors will be washed out and we would not look as nice as proper as we do.

This is an established business, like I said, it's already giving around 80-plus revenue per year for Stora Enso and steadily growing into new applications. The middle portfolio on the chart is the fiber business, and that is new applications for the fiber. Here, we have both papira and fibrease, which are bio phones that are replacing fossil-based cautioning or insulation with completely not only recyclable but renewable material, you can even compost papira at home, growing new trees or vegetables in your garden.

I have heard that Santa Claus are coming a little bit early this year. So maybe when you leave, he will be there with a small papira gift for you. So you can get a feel and touch of the material itself. Here, we are selling commercially already from the pilot, we have letters of intent to fill the first commercial facility. And we are just right now discussing with partners to have a good partnership set up where we both can have the production, but also the offtake as part of the company or spin-off or joint venture depending on the setup that we will decide upon.

Moving from the fiber business. Last but not least, maybe the coolest part of the company or our portfolio, lignode and carbon scape, so offering renewable materials into the battery itself. Lignode and carbon scape are replacing fossil-based or mined materials in anodes. This is an area where we are step-by-step and steadily moving forward.

Right now, we have 500 kilos or half a tonne of lignode being trialed with our customers and into sodium ion applications. And on the picture here, you have the first sodium-ion pack we made together with Altris, our -- one of our partners within this space. And here, we will continue to steadily expand this. We have moved the pilot from producing grams to producing tonnes and in value chain partnering setup, we will make sure to be able to take steady speed to market while ensuring we have all the right competencies and share risk and reward.

I had the third area that I was supposed to talk about. Do you remember? Maybe most interesting for you, that's our clear path for margin expansion. Shall I still cover that? I see some nodding faces. Let's go to that then.

So as I said in the beginning, we are around 10% now at the bottom of the cycle, proud of that. But we believe with own actions we can take that higher. In Han's presentation, three out of the six examples were examples from biomaterials and actions that we have in motion already delivering value to our bottom line. You heard Marcio talk about the plantations in Veracel with not only improving differentiation and silver culture in the plantation, but also making every tree a little bit better than the previous one.

We have right now have Montes del Plata in overhaul that we used to call annual overhaul. We are now first time into 18 months pit stop, and that is now implemented into foreseeable future, meaning that we can run more quantities between the overhauls, but we can also optimize the overhauls better because we have more time to plan between them.

And that's also true now for Veracel coming in, in Q1 as well as for Enocell, just out of the last 12 months pit stop, next one is in 18 months. We also have sourcing actions, making sure we leverage the volumes of Stora Enso with buying power when it comes to chemicals, and for our JVs with our joint venture partners. And then for our new businesses, we believe the partnering is a very good way to share costs of continued development that will be needed at the same time as expanding the margins for the revenues.

So to summarize, we are uniquely positioned to serve demanding customers with specialized pulp and new biomaterials. We have the fantastic eucalyptus, sustainable, underpinning packaging performance, as well as offering significant cash flow for the company. And last but not least, we have a very clear path of own actions to improve our margins. And as you heard me say, they are already in motion.

Thank you very much for listening. And I look forward to your questions and welcome Jutta on stage.

Thank you so much, Johanna. And I ask also Carolyn and Andreas to join us to the stage as well. So we are open for the Q&A session, and you guys know the drill by now. [Operator Instructions]

It's Lars Kjellberg at Stifel again. Andreas, you spoke to a couple of things. when it comes to BM6 and the cost curve, and Hans already spoke to agility. I guess in terms of that agility, given that you're still low cost from BM6 relative to some of those third and fourth quartile, would you have an agility to shift production away from those given the excess supply that we currently have to reduce the overall cost base and really ramp up BM6 quicker?

The second point on agility when it comes to sort of the long-term contracts that you have, it's obviously proven to be a bit of a headache considering the wood cost increases and the inability then to move pricing quick enough to compensate for that much higher cost if you can give us some thought on that?

And the final question is just -- so I understand exactly what you spoke to at Fors the sort of EUR 6 million, EUR 7 million benefit from buying Eucalyptus now, where does that actually come from? What is delivering that cost benefit for that particular site?

I'll start with the last one. So when you -- we were using other sources of pulp, birch pulp and other pulps, and eucalyptus is more affordable than those other pulp grades. So just by managing to keep the same specs of our packages with the eucalyptus pulps instead of the other grades, you get from that price difference that you get from our outlets. So we managed to keep the specs, don't change our product, don't change our offering to the customers, but work with the recipes by replacing other pulp grades. So that's where it comes from.

Then you asked about our contracts. And I think, yes, in the past, we have had some headaches as you referred to, we have also learned from them. And then just to address that specific topic, in most of our contracts which are multiyear contracts. We have no clauses when there is a cost disruption that this allows us to open a contract to renegotiate it.

But what we have also experienced in the recent past, even when the few cases when this was not in, that the customers were understanding of the situation, and there was a possibility for some upcharge. But we have now, in most of our contracts, if not all of them by now, which are over a year, inserted certain clauses that if there is a certain percentage disruption on costs, both sides agreed to renegotiate. So that minimizes the risk that we have faced in the past.

Then when it comes to the cost position in Oulu, yes, it's the market leader. And yes, it will allow us to grow our market share as we have already been doing, if you look at our relative performance in the market statistics. So -- and we have seen some of high-cost machines of other players already being shut down in Finland, for example. So I think that is something that is a possibility that this will continue to happen.

What we are doing is we're focusing on what we can control, and we go for the market share, we go for those bigger volumes, all allows us to be cost competitive in those bigger volumes. And then our -- let's take Fors for example. Fors has this incredible ability of serving especially smaller wheels, those niche products and that you cannot replicate in a big machine, you just lose too much efficiency. So it has its value there in the portfolio as well. And then again, there's so much more capacity at higher cost than our smallest machine in Fors.

It's Linus Larsson in SEB. And it's a question to all of you. It's pretty clear to me that you're very passionate about what you're doing. But I wonder what makes you tick on the -- when it comes to your private economy, which are your KPIs? And how are you incentivized? And how is that like aligned with the group targets that we previously talked about. And as part of that, how are your KPIs aligned with capacity rationalization? Is that -- are your KPIs preventing you from potential capacity rationalization or is there an alignment on that? I don't know who wants to ask -- who wants to talk and respond, but it's basically a question to all of you, I guess.

Thank you, Linus. Well, if I start, and let's put it pretty simple. We have short-term targets, we have long-term targets. Long-term targets are aiming for us to make sure to increase shareholder value over time. Short-term targets are geared towards delivering the short-term financial commitments. So in our short-term financial targets or short-term targets, they are around safety because, of course, nothing can be more important to make sure that you can come home from work, all safe and sound.

But after that, it's profitability and its operating working capital. So all the rest is falling out of that. So would we run uncompetitive assets? No, because that would eat EBIT. Would we build stock instead of making sure we could sell as much as possible?

No, because that will increase working capital just to put it simply. So I think the Board have done excellent in cooking this down to long-term measures supporting shareholder value long term, but at the same time, short-term measures being very crisp and clear and geared to what's needed within the coming quarters and years.

And if I just maybe build on that. There are also shared targets coming back to your capacity asset optimization. Like me and Marko over there under his responsible foodservice and liquor, we share some assets that also means we have shared targets. So I have order incentive to maximize value regardless of where. So as I said during the presentation, I'm data-driven. I have not particularly -- not a lot of any of my machines. I just wanted to generate as much value as I can. And that will be done by optimizing their product allocation to the lowest cost assets wherever they are.

It's Charlie Muir-Sands from BNP Paribas. I just had a question. Firstly, a follow-up. You mentioned a clause to kind of revisit pricing where you see cost movements. I mean, it looks like wood costs are maybe starting to come back down now. So does that cut both ways? Do customers have the right to kind of come back and say, "Well, hang on, your wood costs are coming down. So can we have a lower price on our consumer board, please?"

And secondly, there was a comment earlier about flexibility of the machines. I understand the new Oulu Machine 6 can obviously produce a couple of different grades. But can you talk a bit more about the flexibility you have within the rest of the asset base and what you've got now and maybe what you can add to that flexibility in the base over the next couple of years?

If I would start more broader and then you can fill in maybe. In a performance culture like Hans talked about the forays, it's not you know that you work very hard when the market is tough, and then you sit lean back when the market is good. So we are working -- we are in a continuous improvement culture. If I take Montes del Plata, we are now in our eighth year of the journey of improving cash cost.

So regardless whether the market goes up or the market goes down, we continue to strive for higher efficiency, better yield as well as higher quality. So that is kind of the fundamental in this because we cannot steer the market. We shouldn't steer the market even, right? So we have to work on the things we can control, and one of them is, for example, cash cost. And all the business areas have similar efficiency KPIs that are in the spot simply.

Andreas, maybe you want to add something from specifically?

So back to the contract question first. It's not like a couple of percentage points, 2 or 3, 4 percentage points that triggers these clauses. There needs to be a major shift in the cost structure, like the war that happened 3 years ago. So that created a big disruption. So those are the kind of events that this contract -- this clause aims at.

And of course, it goes both ways. It would not be fair with our customers that we only look to what is important for us. I think it needs to be a fair, win-win situation, and that is what is reflected. But again, it needs to be a major disruption. So the smaller up hikes, down hikes, those we will have to manage ourselves.

Then on the interchangeability, so we have two main -- or three main grades, if you will, in BM6 in Oulu. CKB, which we also produce in Skoghall, and that is exactly the same recipes. And then we have also Performa Nova, our GC2 and Performa Lumi, our GC1. Those have been based on the recipes from Fors. We are working and we continuously work with our development. So there is now some interchangeability also among other assets, for example, Imatra and Fors.

Andrew Jones from UBS again. I just want to talk about a future capital investments. I mean, clearly, you're talking about getting the debt down and reducing the CapEx in the nearer term. I'm wondering under what circumstances you'd be talking about going ahead with, say, the Langerbrugge conversion. That's obviously something you've talked about being an attractive project in the long term. Under what circumstances would you commit to that?

And also on the Lignode side, I mean that was obviously talked about more actively, I think, a few years ago. What sort of capital requirements would that business need to scale that? And could you maybe give us some idea about the sort of longer-term market opportunity in that business? And again, what circumstances would be required to move that forward?

Should we start on the capital allocation or capital needs. So I think Langerbrugge, of course, I mean, we have talked about it in the past, and I think it makes a lot of sense in a market where integration actually is the key to win in corrugated and container world. The market is oversupplied as we have discussed today also. So this is probably not the best moment to bring new capacity to the market, but I'm absolutely sure that the market consolidation will also continue as we've seen and as we've spoken.

So the market consolidation will continue in containerboard and also in corrugated. And I think this is then maybe a couple of years down the line. And then this investment makes total sense because we have a very, very good footprint in Western Europe right next door, basically. So we could replicate the situation we discussed in Poland, also then to Western Europe. So this actually makes a lot of sense. Not at this moment in time in the market.

But going down the line 2, 3 years, this will actually be a very, very meaningful future potential investment.

And if you kind of boil that down, I think what will make us consider future investments. First of all, we are well invested. Even take fluff that I talked about, we have spent already EUR 100 million to modernize and make sure to have a fluff production that is top-notch.

To invest more in fluff, it would be a need to have a very good business case. And that I think is true for anything. It needs to be good shareholder value and there needs to be customers out there that want to buy this and need this, right? And that's true for, I think, any business looking forward. So shareholder value, customer commitment.

And with those words, it is very good to conclude the Q&A session for this one. Please let's continue the discussions during the lunch break. But before that, let's hand over still to Hans for concluding remarks. Thank you.

Thank you very much, team. Thank you to all. It's now time to conclude. And there are three key takeaways I would like you to take with you from this Capital Market Day.

First of all, we are sharpening our focus. We are creating two leading champions in their fields to maximize business value but also to maximize shareholder value. Then number two, we are executing on our margin expansion, profit improvement actions with speed and determination, building on our performance culture throughout the whole company.

And number three, we are generating cash. We're really focusing now on cash generation, disciplined capital allocation. We have strong world-leading asset base. We can capitalize on the heavy investments on our leading assets, our leading product portfolio. Now it's really the time to harvest.

With this word, we thank you all for your active participation, and we end the webcast by now. So thank you, and bye-bye.

Hello, everyone, and welcome to Stora Enso Investor and Media Webcast. My name is Jutta Mikkola, and I'm the Head of Investor Relations here in Stora Enso. With me today is our President and CEO, Hans Sohlstrom; and our CFO, Niclas Rosenlew. We are hosting this special webcast today in the light of the exciting news released this morning. We will begin with a short presentation followed with a Q&A session. [Operator Instructions] The call is scheduled for 30 minutes.

With these words, Hans and Niclas, the stage is yours.

Good morning, good afternoon to all of you. We are excited about the news we have released today. We have made a decision to create Europe's largest listed pure-play forest company. So the Board of Directors has decided to move forward with the demerger, and this is really exciting news because it's there to unlock the full business potential of both the forest company as well as the renewable materials company, maximizing shareholder value, optimizing capital allocation and also reducing complexity, increasing business focus in both companies. This forest company would comprise 1.2 million hectares of forest land in Sweden with a fair value of approximately EUR 5.7 billion. The company would be listed on the Stockholm as well as Helsinki Stock Exchanges with the headquarter in Falun, Sweden.

The demerger is expected to be completed during the first half of 2027, and of course, it's subject to approval and signing of the demerger plan by the Board of Directors and approval by a general meeting to be convened separately by the Board at a later stage.

Next page, please. So the planned demerger would maximize shareholder value, and it would maximize also the business value in both companies because they are distinct 2 different operating models, business models. We have Stora Enso, the group, global leader in renewable materials with a sharpened focus on renewable packaging, with strong market positions, world-leading and European leading market positions, customer-centric offering based on sustainability and innovation, very flexible, integrated and cost competitive production and a tangible path to grow the company as well as also continuing our determined actions to improve profitability.

The new forest company would be Europe's largest listed pure-play forest company. And we know that there is a big appetite for investment in this type of assets. It's a unique class of assets, and we anticipate continued long-term value appreciation. The last 30 years shows that Swedish forest assets have been appreciating with an average of 7% per year. There are strong tailwinds for this business from renewable materials, renewable energy and new carbon sequestration revenue models. So there is potential for lots of significant new revenue streams.

Next page, please. The demerger time line is as follows here. We have a Capital Market Day now coming up on the 25th of November, where we will provide more information. And there will be also a separate Capital Market Day focusing on the new forest company during next year and then the listing of the new forest company is expected to take place during the first half of 2027.

Next page, please. Then we have also today announced a strategic review of our Central European sawmills and building solutions operations. This concerns one business unit within Wood Products. We have been operating this entity as a P&L responsible business unit since the 1st of July, and it includes 7 sawmills and 3 CLT plants in Austria, Czech Republic, Lithuania and Poland as well as also wood procurement in that region serving these units as well as international sales and distribution operations globally.

Also, we see that this is an attractive business, and there are strong growth prospects driven by sustainability trends it does not bring strategic or operational synergies to our core renewable packaging operations. The sawmills and the further processing units in the Nordic countries, they bring synergies to our packaging materials and pulp operations that are located in the Nordic countries. And as you recall, they have been organized within the business units of these board and pulp mills as from the 1st of July. So the strategic review will assess different scenarios, including the possibility to divest this business during next year. In the meanwhile, operations serving customers will continue as normal.

Next page, please. And there are some implications to our group leadership team. First of all, Tuomas Hallenberg, who is currently leading our Forest business area, has today been appointed CEO, President and CEO of the new Swedish Forest business entity. As from the 1st of January, we will start running this entity as a company or as a unit within Stora Enso until the demerger. So Tuomas is building up the organization, the structure, the business, everything related to this so that we can demonstrate the performance of this unit and be in a flying -- being flying with this business also then at the moment of demerger.

We have created a new business area led by Pauli Torikka, the business area Wood and Energy, which includes the Wood Products South unit as well as all the wood sourcing, wood trading as well as Energy that we will start leading as a business. So he will join the group leadership team as from the 1st of January, leading this new business area. Hannu Kasurinen, who is currently leading Containerboard business area, will retire by the end of this year after having served Stora Enso for a remarkable 32 years. Big thanks to Hannu for your valuable contribution. And Lars Volkel, who is currently running the Wood Products business area has been appointed Executive Vice President, Containerboard Business area as from the 1st of January, succeeding then Hannu.

Next page, please. So all in all, the new Wood and Energy business area is including all the wood sourcing, wood trading, which is a significant operation, all the Wood Products supply chain and sales centrally, even if the P&L of our Northern wood products units are part of the board and pulp mill business unit, and it will include the Energy that we are now starting to steer and lead as a business. We have important energy assets, and we have also important external sales of energy, and we see that there is a possibility to maximize profitability by leading this as a business instead of as an internal service.

And the Central European sawmills, the business unit, Wood Products business unit South will then also report into this business area during that strategic review. So this business unit accounts for a significant part of our operations. And we are going to drive profitability and operational synergies efficiencies also through this new business area.

Next page, please. So all in all, we have the Capital Market Day coming up here, and now we are prepared to take your questions.

[Operator Instructions] Our first question comes from Cole Hathorn at Jefferies.

I'd like to start off with the Forest spin. Is there any details that you can give on the EBITDA or how you're thinking about the new entity dividend policy, how much debt you're going to allocate to the new business? Or is that something that you're going to provide with the Capital Markets Day or still to be set into the future? Any details you can provide on the future of the new forest entity would be helpful.

Thank you, Cole. We will give some further information on the Capital Market Day. But as I said, we will also organize a separate Capital Market Day for the forest company during next year, and that is really the moment for all the more detailed questions. But certainly, in the next Capital Market Day, 25th of November, there will be further opening up around the forest company as an entity.

In that case, let me focus on the strategic review of the sawmill and Building Solutions business. Stora Enso has got a very strong position from a market share globally, you've led the CLT business. I'm just wondering the time to sell this is really where we see a construction recovery. How are you thinking about timing so that you get the best value for this? And does getting rid of the global sales network impact any of your Nordic sawmills by not having access to that kind of sales team?

Yes. We have thought through this very, very thoroughly. And of course, timing is important, and that is also why we want to take some time for this strategic review. So we will look for the best timing to maximize shareholder value. So this is -- we don't have any pressure to divest, but I think it's also good when it comes to our strategy, focusing on renewable materials with a special focus on renewable packaging to also clarify this question. And that is why we have initiated and published this strategic review. And when it comes to the sales also there, we have thought it through and we have arrangements how this can be taken care of without any dissynergies.

Our next question comes from Reinhardt van der Walt at Bank of America.

First, I just want to get a sense of how we should think about, I guess, the equity story of this new forest company and sort of what the management team's mandate will most likely look like? I mean, is this really just going to be sort of a holding company for real assets? Or do you think that there is some kind of optionality that can be exploited in the new vehicle as well?

So clearly, the mandate and the target for the management of this company is to maximize shareholder value, so to maximize value of that very important asset valued at EUR 5.7 billion. And there are many ways to maximize the asset value. There is, first of all, efficient forest management, harvesting. And you know that we harvest less than the growth. So the standing stock is increasing continuously, also supporting value growth. And there are also other revenue streams.

We have some unique features like precision forestry, a digital twin of all the forests, not only our forest, which actually gives us an opportunity to optimize. We have even found more productive forest land using this very, very good AI-based digital tool. There are also new revenue streams from renewable energy, wind, solar, where we have a big untapped potential.

And there are new -- completely new types of carbon sequestration markets evolving here, like, for instance, we can rewet peatland, which is nonproductive forest land and by rewetting a dried peatland, we can tie up 250 tonnes of carbon per hectare of peatland, and there are companies who are prepared to pay for these services. And there are many other recreational services, land optimization. So by focusing and developing this business, we can significantly accelerate also value creation. And just as a reminder from our stock exchange release, during the last 30 years, the value appreciation of Swedish forest in general has been 7% per year.

Understood. And if I could just do one quick follow-up. The non-Sweden forest assets, can we expect a similar process to be run for those assets, potential private sale? Or do you think those remain naturally in the rest of the portfolio?

Well, this concerns now our Swedish forest assets, the 1.2 million hectares. And regarding the rest, there is no further considerations or plans at this moment.

Our next question comes from Charlie Muir-Sands at BNP Paribas.

First one just relates to the decision to do the spin-off. I think you clearly before indicated that was the strong preference. But did you explore the possibility or did you entertain any offers from third parties for a sale of any more of the forest at all?

Yes, of course, we have thought about all the options, and we know quite well the sale option because we just end of September, concluded the sale of 175,000 hectares of forest land in Sweden, which was sold at an enterprise value of EUR 900 million. So exactly at our book value, including a long-term wood supply agreement. And through that process, we also have a very good view of the big appetite actually for this type of assets, this type of investments. And that's why we are also encouraged to move forward with this demerger. And we think that there will be a great appetite for this asset class among lots of institutional and also private investors. So yes, of course, we have been looking into various options and alternatives.

We see that this way forward is absolutely the most attractive solution for our shareholders. Our current Stora Enso shareholders will become shareholders in this stock-listed company with the same ownership share as they have in Stora Enso today. And we think it's also the most shareholder-friendly alternative so that shareholders, depending on the appetite for risk and return, they can also make their choices about where they want to allocate their investments. We think this is a great opportunity to unlock shareholder value and to maximize shareholder value in Stora Enso.

And just on the remaining Stora Enso entity, you're clearly going to be left even more reliant on external wood sourcing even if that external sourcing is from the forest company. So how do you aim to protect the company from the wood cost pressure, particularly given notwithstanding the fact that wood costs are starting to come down. They have been quite volatile and put a lot of pressure over the last few years. Are you aiming to secure long-term pricing agreements? Or how are you going to manage the greater operational leverage of the remaining company?

Yes. Yes. Thank you, Charlie. Well, also in this case, as we said in our stock exchange release, there will be a long-term 18-year supply agreement in place, but gradually decreasing committed volumes to Stora Enso and increasing volumes to third party or possibility to increase volumes to third-party other customers. We think it is important for the optimizing the business in both companies. And -- and already today, I mean, our Forest business area has been operating on market practices, market price practices. So the transfer prices to our industrial activities are market-based. So we know what it means also for our industrial activities.

And we are convinced that with the determined actions we have to improve our margins, our -- reduce our costs, improve our cost competitiveness, we will be successful with the renewable materials company also with less direct forest ownership.

May I just add, Hans and Charlie, I mean this is -- we are talking about 7% less -- significantly less than 10% or 7% of our wood supply today. So it's not like it's a major change globally. Of course, locally, it is. But already today, 93% is bought outside.

93% at a group level is already bought outside on a net or gross basis? I thought you had 35% self-sufficiency.

Yes, that's the gross because we are also -- we are doing significant wood trading. So we are buying much more wood and then selling to third party. So that would be the gross figure. The gross figure, yes. correct.

[Operator Instructions] Our next question comes from Linus Larsson at SEB.

Clearly, Stora Enso is refocusing on packaging, and that's even clear with today's announcement regarding the strategic review that you're now initiating with regards to the Continental European sawmills. And a couple of things in relation to that. First, if you could provide some reassurance that you will make sure that you will not sell these assets at a point in time when simply they will not provide you with the appropriate value for shareholders. And if markets aren't supportive that you will basically hold back on such execution.

And then secondly, I mean there are other assets as well in the group, which are not directly or not obviously supporting a packaging strategy. So -- and I'm thinking maybe especially not about the forest, but the pulp mills, you have 4 stand-alone pulp mills, you have a net long position of some 2 million tonnes per annum around the world. Could you just update us on your strategic thinking around your positioning in market pulp as well?

Yes. If I can take your first question here. So first of all, we can assure you that we will -- if we divest and when we divest, it will be -- the timing will be the right one to maximize shareholder value. Our most important job, my main KPI and Niclas' main KPI is shareholder value maximization. And let's remember that we have significantly strengthened our balance sheet with the forest deal just recently. And also this demerger will further allow capital allocation optimization and debt allocation optimization, so strengthening further the balance sheet significantly of Stora Enso renewable materials company. So yes, I can assure you, Linus.

Regarding the pulp mills, actually, they are a very integrated part of our renewable packaging growth strategy. Let's remember, for instance, that with the new Oulu consumer board line, already today with that unit fully ramped up, 75% of our ownership share in Veracel, which is one of the most cost competitive eucalyptus mills in the world, will go to our internal use. And we see a clear trend of increasing use of eucalyptus pulp in our board production in Europe. It is cost efficient, and it's a clear trend that we are leading in this area.

Let's also remember that this is a competitive advantage for Stora Enso. We are the only European packaging material board producer with own cost-efficient assets in South America. So they are an integral important part of our packaging materials growth. But Niclas, do you want to add?

No, no, that was actually...

And just now you mentioned the LatAm mills, just to make sure, is that also your thinking? I mean, Skutskär, Enocell is somewhat different setup. How do they fit into the increasing focus on packaging in the group?

They also fit in there quite well. Enocell, for instance, is supplying unbleached kraft pulp to our board mill in Beihai to produce CKB, where actually we are the only producer in China. The rest is imported from the U.S. that gives growth opportunities. And Enocell is also supplying internally to some of our other mills. Skutskär, even if it's Europe's largest producer of specialized fluff pulp, it is also supplying some pulp to Skoghall, for instance. So there is a certain integration also there between these Nordic pulp mills.

Our next question comes from Robin Santavirta at DNB Carnegie.

I have a question related to this 18-year wood supply agreement. How does that work in practice? First of all, why 18 years? Is there some regulation that steers you to that sort of why not 35 or 50? And then secondly, it seems other companies can also -- or the forest company can also supply to other companies. Is that correct? And then finally, related to this, your mills are really not that close to your forest. So you must have bought a lot of wood raw material from other suppliers. So how much of -- how much did Stora Enso's industry account for the sales of your forest before this transaction? So those ones.

Robin, good to see you again. The -- on the 18 years, I mean, this is -- we are creating 2 independent and strong companies here. And of course, both need to work independently, both need to stand on their own legs. And at the same time, of course, securing a good kind of runway for both businesses. And in terms of the length of the wood supply agreement, I mean, we have experience. We have a wood supply agreement in place also for the 12% that we sold and a lot of thinking has gone into that. And this is a balance. This is something which we view is optimal and good. And there's a certain -- and we'll come back to that in future meetings in CMD and so on.

But there's a ramp-down period in terms of exclusiveness and again, important that the new forest company can stand on its own legs and also create its own business. We see a lot of good reasons for why to continue to be tightly or trade between the 2 companies, but also there's an importance in this independence.

And as we mentioned before, so about 7% of our total wood procurement, gross wood procurement comes from these Swedish forest assets, the 1.2 million hectares today. But we also -- we sell -- we buy and sell. We buy from private forest owners, and we sell also quite a lot of wood to third-party forest industry companies. So yes, we have a significant wood trading business, and that is also one of the basic ideas of the wood and energy business area that we have created.

And can I squeeze in another one. When I look at the financials of the Forest segment, and then when I compare it to, say, Tornator, there's quite a big difference in earnings and cash flow as they're stand-alone and they are very optimized. So they're clearly ahead of you on the Swedish forest assets it seems. Do you think there is a potential for the Swedish forest assets, earnings and cash flow to reach those levels that Tornator has reached? I mean they were very weak 25 years ago before the split or the formation of Tornator. Now the numbers look completely different. Can you do the same journey in Sweden?

Just on the numbers, and Hans, you can take the second part of it. But we have not split out the Swedish forest numbers. So of course, one can do kind of backward calculations and end up, but I would caution everyone a bit that don't draw too kind of detailed conclusions on the Swedish forest numbers before we are at that stage where we can talk about the real facts.

And I think, Robin, spot on. I mean one of the main reasons for this demerger is that with full focus, with full development, incentivizing the management with a dedicated Board of Directors, there is potential to accelerate value creation within this very focused Forest business. And let's also remember that our forests in Sweden are located in the south, mid part of Sweden, where also the growth of forest is clearly higher than in the more northern part in Sweden. So there are forests and forests in Sweden, and these are great forests.

We have reached the end of the Q&A session and have run out of time to take any further questions. I shall now hand the call back to Hans Sohlstrom and CFO, Niclas Rosenlew, for closing remarks. Thank you.

Well, thank you very much for your participation today. We are very excited about this. Our main objective is to maximize shareholder value through the performance of our operations and our business, and we are confident that, that is taking -- these decisions today are taking us in the right direction. We are continuing to execute on our strategy, building a better, stronger Stora Enso and building the world-leading forest -- pure-play forest company with speed and determination. Thank you very much for your attention. Have a good day. Bye-bye.

Hello, everyone, and welcome to Stora Enso's Third Quarter Results Presentation. I'm Jutta Mikkola, Head of Investor Relations, and I'm joined today by Hans Sohlstrom, our President and CEO; and Niclas Rosenlew, our CFO.

The theme for today is good progress in a challenging market environment, which indeed we have done. We'll start with Hans, who will walk us through the key highlights and strategic focus areas. After that, Niclas will take you through the financial performance, and we'll wrap it up with the main takeaways and key focus for the rest of the year '25. Once we are done, we'll open the floor for your questions.

Thank you for being here with us today. Hans, over to you.

Thank you, Jutta.

In the third quarter of 2025, despite ongoing challenging markets and subdued demand, we remain focused on the areas within our control, driving progress where it matters most. However, before looking more closely at the third quarter highlights, I would like to announce changes in Stora Enso's Group leadership team. Micaela Thorstrom has been appointed Executive Vice President, People and Legal, General Counsel, as of 1st of January 2026. Micaela has been part of our group leadership team since 2023, serving as Executive Vice President, Legal and General Counsel. Furthermore, Niclas Rosenlew, our Chief Financial Officer, will assume additional responsibilities and represent the Communication and Brand organizations on top of his current duties. I want to congratulate both Micaela and Niclas for their new and extended roles.

Then we are ready to look more closely at the quarterly highlights. We have taken important steps to build a stronger and more competitive Stora Enso. A major milestone in the quarter was the completion of the divestment of approximately 175,000 hectares of forest land in Sweden, representing 12.4% of our total forest holdings in Sweden. The transaction with an enterprise value of SEK 9.8 billion, equivalent to approximately EUR 900 million and in line with forest book value, strengthens our balance sheet and improves our financial flexibility.

The deal includes a long-term wood supply agreement to Stora Enso. This strengthens our cash flow and reduces net debt, which is a key priority for us. We also made progress on the strategic review of our remaining 1.2 million hectares of Swedish forest, including the assessment of a potential demerger and public listing. This review is central to unlocking further value for our shareholders, as well as strengthening our growth and business focus in both forest and renewable packaging businesses. We'll share updates as that process moves forward, aiming at Capital Markets Day later this year on November 25.

On profitability, we continue to act proactively to improve margins. These measures are essential as we navigate challenging market conditions and subdued consumer sentiment. Adjusted EBIT for the quarter was EUR 126 million. Excluding the EUR 45 million impact from the Oulu consumer board ramp-up, profitability would have been comparable to the same quarter last year, reflecting a stable underlying performance despite persistent market headwinds.

And finally, on sustainability, we launched a science-based framework together with IUCN to advance nature-positive forestry practices. This is an important step towards our long-term environmental goals. As we all know, market conditions have been challenging. Therefore, we have intensified our actions to improve profitability. But it's important to emphasize that these efforts are not new. We have been acting on these priorities for a good while now.

Since 2023, we have been very clear on our strategic focus; improving profitability, driving performance and shaping the portfolio for long-term strength. This has been our new way of working proactive, not reactive, so we can stay ahead of market turbulence and rapidly changing global trends.

On fixed cost reduction, we launched significant cost-saving programs in 2023 and 2024, totaling over EUR 230 million of savings. These include structural efficiency measures, site closures and divestiture across business areas and the group. Operational efficiency has been another key focus. We have implemented FTE reductions, cut external spend and driven value creation initiative across the whole company to streamline processes.

Building a strong performance culture has been critical. More than 4,000 improvement measures have been identified with around 800 initiative team leaders, meaning that thousands of our employees are actively driving continuous improvement and cost savings initiatives across the company every day. We have also strengthened cash flow and working capital discipline, reducing operating working capital by about EUR 700 million and improving cash flow from operations. Going forward, we remain committed to disciplined capital allocation.

Finally, on portfolio actions. On top of earlier closures and divestments, we completed the sale of 12.4% of our Swedish forest assets and continue the strategic review of the remaining assets in Sweden. At the same time, we are ramping up Oulu consumer board line and De Lier corrugated site to secure cost efficiency and competitiveness. This approach gives us resilience and flexibility. By acting early and decisively, we have not just reacted to market challenges, we are shaping our future and positioning Stora Enso to thrive in a rapidly changing world.

And with that, let me give you an update on the Oulu consumer board line ramp-up. Stora Enso's

new consumer packaging board line at the Oulu site in Finland has entered the production ramp-up phase earlier this year. While the project remains on track in terms of its original time line and the EUR 1 billion budget, the ramp-up process has progressed slower than initially anticipated, resulting in production volumes somewhat behind the original schedule.

Nevertheless, we remain focused on reaching EBITDA breakeven by the end of 2025, which continues to be an achievable target. However, due to the slower-than-expected ramp-up, the EBIT impact for Q4 is now projected to be higher than previously anticipated, estimated at about EUR 15 million to EUR 35 million. Consequently, the full-year EBIT impact is expected to be in the range of EUR 120 million to EUR 140 million. It is important to emphasize that the Oulu investment is a long-term strategic move that will deliver substantial value for Stora Enso over time. This transformation of the Oulu site into a state-of-the-art consumer board production facility is a cornerstone of our strategy to lead in renewable packaging. This investment is not just about near-term volumes, it is about building a competitive platform for the next decade and beyond. As the ramp-up continues, we remain confident that Oulu will become a key driver of profitable cost competitive growth and a benchmark for sustainable packaging innovation.

This year, we have seen some remarkable recognition for our design and innovation. Winning the Red Dot Design Awards 2025 underscores our ability to combine aesthetics, functionality and sustainability in everything we create. Our craftsmanship was showcased on the global stage at the World Ski Championships where we designed official medal boxes crafted from renewable materials, fully recyclable and even featuring braille for accessibility. This is not the first time we have been recognized by Red Dot.

Earlier this year, we also received the award for our collaboration with Marimekko on a scalable, recyclable gift packaging portfolio. One of the most exciting milestones is our contribution to Atlassian Central in Sydney. Once completed, it will be the world's tallest hybrid timber tower, and the heart of this achievement is massive timber solutions. It's a powerful demonstration of how engineered wood can transform urban skylines while reducing carbon emissions.

Closer to home, October brought us the Finlandia Prize for Architecture for our new headquarters at Katajanokan Laituri in Helsinki. This award celebrates not only architectural excellence, but also our leadership in sustainable building practices. Together, these achievements highlights how innovation and responsibility go hand-in-hand in shaping the future of construction.

That concludes our review of the key highlights for the quarter. And I'll hand over now to Niclas, who will take you through our financial performance.

Thank you, Hans, and hello, everyone.

During the third quarter, as Hans already mentioned, our own actions resulted in good progress in a market with subdued demand and low consumer confidence. Delivery volumes were relatively low, particularly in containerboard and biomaterials. Sales increased by 1% to EUR 2.3 billion, mainly due to the contribution of the Junnikkala acquisition and the consumer board line ramp-up at the Oulu site. While market conditions continues to be volatile with low demand, we focused on the areas within our control.

On that note, adjusted EBIT for the quarter was EUR 126 million. And as Hans mentioned, excluding the EUR 45 million impact from the Oulu ramp-up, profitability would have been comparable to the same quarter last year, reflecting a stable underlying performance despite persistent market headwinds. This we can see clearly when looking more closely at the EBIT bridge for Q3.

Overall, adjusted EBIT decreased by EUR 49 million compared to last year, primarily due to the ramp-up of the new line in Oulu. As said, Oulu had a negative impact of EUR 45 million. In the other bar, where you can see the Oulu impact, you can also see the absence of a EUR 10 million insurance compensation that was received last year in the Wood Products segment, along with some other smaller movements.

Looking at the other components, the picture is relatively stable. Given how volatile the markets have been, we are quite pleased with this, as it reflects the result of disciplined execution of our strategy and profit improvement actions. Price/mix contributed positively with EUR 12 million, partly offset by a smaller negative impact from lower volumes. Variable costs were flat as higher fiber costs were offset by lower energy and chemical costs. Fixed costs decreased by EUR 30 million, driven by strong cost control and lower maintenance compared to last year. And FX had a negative impact of EUR 20 million.

If we then turn the focus to cash flow, despite the challenging market environment, we managed to safeguard profitability and improve cash generation. Cash flow after investing activities turned positive as expected, following the gradual completion of the investment phase in Oulu. I want to note that in this picture, which shows the operational cash flow after investing activities, the proceeds from the Swedish forest divestment, so the 12% divestment are not included. These proceeds were received in Q3, but they are recorded further down in the cash flow statement under divestments.

And on that note, let's take a look at the net debt. Net debt decreased by almost EUR 800 million to EUR 3.2 billion during the third quarter, reflecting the positive impact of the forest asset divestment. The ratio of net debt to the last 12 months adjusted EBITDA is now at 2.7x after being above 3 for most of the past 2 years. As the intensive strategic CapEx phase of the last 2 years nears finalization and profitability gradually improves, net debt levels and the ratio are expected to improve further. Operating working capital to sales was around 8%. That is at similar levels to the last few quarters. We intend to keep operating working capital at these lower levels and decrease it when possible.

So, let's move on to the segment performance. Starting with Packaging Materials, where we continue to implement value creation actions during the quarter to mitigate the impact of the challenging market conditions. Sales declined mainly due to slightly lower consumer board prices and adverse currency effects from a weaker U.S. dollar. Adjusted EBIT decreased year-on-year by EUR 37 million, primarily due to the adverse impact coming from the Oulu ramp-up.

In addition, fiber costs remained high and logistics expenses and trade tariffs increased, adding further pressure on profitability. These headwinds were, as said, partly offset by value creation initiatives. As order inflow weakened further during the quarter, we continued to manage capacity and cost levels in line with demand.

In Packaging Solutions, we had a similar development, with market headwinds being offset by own actions. Sales increased slightly, with improved product mix offsetting a small decline in volumes. Adjusted EBIT increased year-on-year, supported by higher sales and improved margins driven by value creation initiatives. Despite persistent overcapacity, actions to enhance product and customer mix, combined with continuous cost efficiency improvements helped protect margins.

So moving from packaging to Biomaterials. In Biomaterials, market conditions stabilized at low levels during the third quarter. Demand for hardwood pulp strengthened in both Europe and China, while softwood pulp demand in Europe remained weak. Sales decreased driven by lower prices and adverse currency movements, somewhat offset by higher volumes. Adjusted EBIT decreased year-on-year, primarily due to lower prices, but as said, stabilized at low levels. Cost reduction measures also helped mitigate part of the negative market impact.

If we then move on to Wood Products, protecting margins has been a key priority mitigating the increase in raw material costs. Sales increased, driven mainly by higher prices and stronger volumes for sawn wood. However, EBIT declined, primarily due to increased sawlog costs in Central Europe and the absence of last year's EUR 10 million insurance compensation, which affects comparability. That said, price increases and value creation initiatives helped cushion the impact and protect margins. The construction market remained weak overall, but we did see improved demand for both traditional wood products and building solutions compared to the previous year.

In Forest, sales increased, driven mainly by higher volumes and wood prices. However, EBIT declined slightly due to slightly higher costs. So in sum, Forest continued its stable and strong performance.

I'll now hand it back to you, Hans, for the key takeaways and our focus for 2025.

Thank you, Niclas.

Today, we have focused on profit, performance and portfolio, 3 pillars that guide our actions as we navigate a challenging market and position Stora Enso for long-term success and improved profitability. Profitability and cash flow remain top priorities, supported by company-wide initiatives in sourcing, operational efficiency, commercial excellence and cost optimization to ensure resilience and agility.

We are finalizing the strategic review of our Swedish forest assets, including evaluating a potential separation and public listing to unlock value and sharpen our focus on core businesses. At the same time, we are ramping up production and leveraging the EUR 1 billion investment in new packaging board line at our integrated mill in Oulu, Finland, strengthening our competitive position in renewable packaging and advancing our ambition to lead in sustainable solutions. These actions are critical steps towards delivering shareholder value and navigating in tough markets. We look forward to sharing more at Capital Markets Day on the 25th of November in London.

Thank you for listening. And we are now ready to take your questions.

[Operator Instructions] Our first question will come from Cole Hathorn with Jefferies.

Could I start with the cost positioning that you -- well, the improved costs in the Biomaterials and Packaging Materials division. The cost per tonne has come down. You talk about efficiencies. Are we right to assume that this is your internal actions that have supported the lower cost per tonne rather than lower pulpwood or wood costs feeding through into the business sooner? So that's just the first question, if it's internal actions.

The second one is around the Packaging Materials business and particularly consumer board. We've got a lot of oversupply in the market. And I'm just wondering how Stora Enso is thinking about that strategically. You are the market leader. How do you think about improving operating rates as you ramp up Oulu versus the price dynamics of the market? Are you still considering, or are you evaluating capacity out in the industry?

Yes. Thank you very much, Cole. So first of all, about the cost improvement actions, they are internal actions throughout the whole company. And we have started this very proactive systematic work on reducing our cost base, both variable as well as fixed cost since 2 years back. We are going to give some updates about this in the CMD on the 25th of November, some tangible examples of the way we are working, but it's significant cost reduction results throughout the whole company. And this is not a project. This is our new way of working.

This is a continuous improvement work. It's our new culture where basically we have identified over 4,000 profit improvement actions throughout the whole company in every unit, every middle, every single part of the organization. And we have 800 project initiative team leaders working on these. So, we have thousands of people actually actively working on cost improvement actions and profit improvement initiatives as we speak. It's not a project. It's our new culture, and it's a continuous way of working.

When it comes to your question, Cole, about consumer board, we know that there is in Europe alone, 1 million tonne of higher cost consumer board capacity than our most expensive, most highest cost line. We also know that we have in consumer board, the most cost-efficient capacities in Europe today. So currently, we don't have any plans to consolidate or close capacity. I'm sure there is considerations in our industry for those who have negative cash flow, for instance.

Then maybe just as a follow-up. I'd like some color on what are you seeing from a demand and order book perspective? And could you give some color between containerboard? And then within consumer board, what you're seeing the difference in kind of the traditional folding boxboard as well as your liquid packaging?

Yes. So first of all, year-to-date, we have increased our top line by 5%. So, we are growing as a company. And also in the last quarter where demand was rather subdued, we grew 1% and we are quite determined to continue growth. We have invested in growth in the Oulu consumer board line, as well as also we have the De Jong corrugated site, which is in a ramp-up phase still. So, thanks to earlier investments, we have cost competitive state-of-the-art capacity that we are ramping up in order to ensure also continued growth for the future.

And when it comes to consumer board versus containerboard, I would say that our operating rates in containerboard are quite high. And as you also know, from a global supply and demand perspective, especially kraftliner, which is our strength, our core area in containerboard, that is actually a market where the global supply and demand situation is the best. The market is the tightest. And when it comes to consumer board, we have very cost-efficient, high-quality capacity that we are currently utilizing and then also ramping up in Oulu.

Our next question will come from Andres Castanos with Berenberg.

Can you please help me understand why did you book a gain of EUR 140 million with the forest asset sale, if this was a sale that was done in line with book value? And also, what is your current view about the deferred tax liabilities associated to the historical appreciation of the assets that you sold? What will be the treatment in your view?

Sure. And it is a bit of a complex accounting issue, but the sale of the 12% was in line with book value. And there was a portion in the book value, which is deferred tax liabilities. As you said, the sale was tax-free according to local tax rules. We sold the company, not the assets. And therefore, from an accounting perspective, we then kind of canceled the deferred tax liability and that portion was then going into the P&L. So it's more of an accounting technical topic.

Our next question will come from Charlie Muir-Sands with BNP Paribas Exane.

There's been quite a lot of talk in the industry about falling pulpwood prices and some mixed messaging around log pricing. I just wondered what you're seeing specifically yourselves at the moment and how soon you would anticipate it manifesting, in your opinion, if there are movements?

Secondly, I appreciate you're going to give us an update on the possible forest spin-off at the Capital Markets Day. But can you share any early thoughts on what you see as the relative pros and cons of making such a transaction?

And then just on De Lier finally. The ramp-up there, you haven't quantified what the profit drag is unlike Oulu. I wondered if you could put any numbers around that? And also, is the constraint for the De Lier ramp-up technical? Or is it that it is constrained by market demand conditions?

Thank you very much, Charlie. So first of all, wood costs have come down in the Nordics, both in Finland and Sweden since the peak in the summer. However, before they are visible in our P&L, there is a time lag. And actually, in the beginning, there is a negative impact because the inventory values of our wood inventories comes down. But there will be with a time lag of a few months, there will be, of course, a positive impact of lower wood costs in the Nordics.

Concerning the forest, the Swedish forest spin-off, 1.2 million hectares in total. I would say that the clear plus is -- and that's also one of the main objectives, shareholder value creation. I mean, we clearly see that now after the sales of 12% of our Swedish forest land, the total value of all our forest holdings is EUR 10.50 per share. And the whole idea here is to unlock value for our shareholders, as well as also being able to focus on the very different businesses of creating value and profits in a forest business, as well as creating value and profits in industrial activities, renewable packaging and biomaterials businesses. Regarding the De Lier markup, the bottleneck is the market. So it's demand. We are gradually increasing volumes there. But of course, in an oversupplied market, it takes time.

Got it. So far, you've not identified any cons in terms of the possible price spinoff.

Can you think about any, Niclas?

I can't immediately at least. We'll think about it.

Our next question will come from Pallav Mittal with Barclays.

Very quiet. Maybe we take the next question then.

Our next question will come from Andrew Jones with UBS.

Can you hear me okay?

Yes.

Excellent. A few of my questions have already been answered, but just a bit of color on 4Q first of all. You mentioned that the fixed costs were down EUR 38 million in 3Q, mainly on seasonality. I'm curious like how much of that should come back in 4Q? And taken together all the other moving parts on costs, I'm guessing that the wood costs don't make that much of a difference in the 4Q given the lag. But can you talk us through like wood, energy, some of the other moving parts as to how you see costs evolving into the fourth quarter?

And then separately, I've just got a question on FBB sales to the U.S. I mean, is that profitable now? Like how should we think about margins on sales there? Have you changed your sales mix as a result of the tariffs and the currency moves? Like how are you looking at the different markets for your boxboard at the moment?

All right. Andrew, I'll take the first one. So fixed costs, very much as we said and we've said before, I mean, we are working a lot on cost scrutiny. And this is nothing new. We've been on it for some time, but there's still a lot to do. So, not commenting specifically now on Q4, but even kind of further out. And that absolutely will continue. Specifically in Q4, we continue with the normal maintenance. Maintenance stops should be roughly similar cost to Q3.

And then on wood cost specifically, very much, as Hans said, we have seen some downward trend. And now we talk about the Nordics, Finland, Sweden. It's different in Central Europe. But again, very much as Hans said, it comes with a delay and we talk about a quarter or 2 or so. When it first goes into the inventory valuation, inventory value actually goes down. It has a slight negative impact on the short-term result. But then, of course, over time, it should start to help the result. So in that sense, it takes a while and don't expect any major impact or positive impact in Q4. Well, I mean, logistics has gone up a bit, chemicals down a bit, energy down a bit. So it's a bit more of a mixed bag.

So flattish sounds like the interpretation.

Flattish, yes. Well, again, not commenting specifically on Q4, but more what we've seen up until now and in Q3.

And when it comes, Andrew, to your question about folded boxboard and the U.S.A., I mean, we have been increasing prices in folded boxboard sales to the U.S. We have been able to compensate a clear majority of the 15% import duty. But on the other hand, of course, also, as we know, during this year, the U.S. dollar has weakened against the euro quite significantly. We are making positive margins on our business to the U.S., but very thin margins. That's where we are today. However, having said that, I do want to underline that if you consider our packaging materials, our board grades, our main board grades, so consumer board various grades as well as kraftliner and then I exclude recycled fiber-based testliner because that's a very local business. But if you look at consumer board and kraftliner, it's good to remember that the U.S.A. is a 4 million tonne net exporter around the world of these products.

So if profitability of sales to the U.S. is challenged, there are also other opportunities around the globe to develop businesses. So, I think one of my favorite sayings is that every challenge is an opportunity. You need to also find the new businesses and the new opportunities, but we have not given up on the U.S. We continue to develop our business there. But of course, in order to improve margins, we need to increase prices further.

Our next question will come from Linus Larsson with SEB.

First, just to double check here, so we're not missing anything on Biomaterials. It was sequentially somewhat better in the third quarter, although prices were lower and I think your volumes were lower as well. So if you could just maybe elaborate just a little bit about what happened in the third quarter? I think we may have touched on part of it already. And just to make sure that we're not missing anything, any benefits which might not be there in the fourth quarter, please?

Yes, I'll start at least, Linus. And I mean, what we saw in Q3 was a stabilization at low levels and so stabilization. So, I would say no major movements there, volume, price that I can think of at least in terms of what to miss now going forward.

If I can build on that, Linus, so I think it's important when you consider our Biomaterials business. So, our market pulp business, we have -- the majority is cost-efficient eucalyptus from Veracel and Montes del Plata, as you know very well. And they are among the world's most cost-efficient pulp mills in the first quartile when you take, for instance, Safra's cost competitive -- cost capacity competitiveness considerations. So, great cash machines in every situation.

And then the market pulp mills we have in the Nordics, so Skutskar in Sweden and Enocell in Finland. They are producing specialized niche pulps. So Skutskar, the majority is fluff pulp, where we are clearly the largest producer in Europe. Most of the fluff pulp in Europe is imported from the U.S.A. So it's a specialty pulp grade. And also in Enocell, we are gradually increasing the amount of specialized pulp grades, among others, unbleached kraft pulp for electrotechnical end uses and other special niches where you can get a better price compared to the volume grades. So, that perhaps also explains somewhat our position in Biomaterials.

And if you compare the various units within Biomaterials, is there a material profitability difference in, say, the third quarter? Or are they all doing pretty well?

Again, we haven't really split out the profitability of every mill. I mean, as we've commented before, I mean, we very much look at -- I mean, each and every component, mill needs to be profitable, goes without saying, deliver positive cash flow. But of course, as Hans said, I mean, the South American operations are kind of absolute cost leaders. So no answer, Linus. No direct answer, at least. I hope it's okay.

Building on that, I would say that based on this product differentiation and specialization in the Nordics, I'm pretty sure that there are lots of pulp mills in the Nordics producing standard volume grades that are not doing as well as we are doing.

That's helpful. And then just one more follow-up on Oulu. And maybe if you could just briefly touch on or give an update on your commercial plans for the output from Oulu, 750,000 tonnes, that's a big amount of paperboard. Where will you allocate those volumes? And have plans possibly changed from your original plans?

Well, Linus, first of all, I think it's important to remember that the line will be, as we have said from the beginning, fully ramped up and in full capacity in 2027. So also next year will be a year of gradually increasing production and sales volumes. Quality is good, really good. We have received very good customer feedback. It's also important to remember that that Oulu is not producing only folded boxboard. It's also producing CKB, for instance, where there are only 2 producers in Europe. We are producing CKB on 3 production lines, and then there is a competitor producing on only one small production line. So it's not only folded boxboard.

We also have some other consumer grades in the Oulu production unit. Then also, I want to remind everyone that Oulu is not only for us an increase in carton board capacity because we are also transferring carton board volumes from our liquid packaging board mills, for instance, Skoghall into Oulu, which gives us an opportunity to grow in liquid packaging board. So basically, Oulu is providing opportunities for us to grow in all the product areas we have within consumer board, both carton board, liquid packaging board, food service board and so on.

And when it comes to our sales plans, so, of course, I mean, our job is to maximize profitability. Our job is not to follow a certain plan, but to maximize profitability in every situation. And therefore, as we discussed before, it's clear that the margins in the U.S. because of the 15% import duties are thinner than what we anticipated before the tariffs came in place or the plans for import tariffs came in place. And we are actively looking to maximize profitability by optimizing our market mix and our customer mix as well as product mix. So, we really look to place those volumes wherever we can maximize profitability and value.

So it's not any board, it's the best board.

Well said. Thanks, Niclas.

Our next question comes from Pallav Mittal with Barclays. [Operator Instructions]

Can you hear me?

Yes, we hear you, Pallav. Good to hear you.

Sorry about that. Some technical issues at my end. A couple of follow-ups on some comments that you've already made. So firstly, on Oulu, I appreciate all the commentary that you have made and clearly, volumes you have highlighted are currently running behind schedule. So, what gives you confidence that you are still on track to reach full capacity by 2027, especially given the overcapacity issues in Asia?

And then secondly, in the third quarter, EBIT, you have almost 30 million-odd fixed cost savings, and these are your cost savings program over the last couple of years. Can you help us understand how much of those 2 programs is already in the numbers so far? And how should we think about further improvement in Q4 and also in 2026?

Yes. Thank you very much, Pallav. So if I take the first question and Niclas, the second one. So first of all, Oulu, I mean, we are ramping up. And I would say that especially the last months have been very encouraging in terms of optimizing the production processes there. And that gives us really confidence that we will be able to reach the full capacity from a production perspective in 2027 as we have forecasted. Then, of course, with a relatively weak oversupplied market that also, in a way, restricts the speed of ramp-up and ramping up the volumes.

Then you mentioned China. We were just last week in China. We know that what is happening in China is that, for instance, there is a lot of the local folded boxboard, which is called Ivory board, taking market share from higher cost recycled fiber-based grades, so what they call Duplex there, which we call testliner in Europe. We can see similar trends in Europe, folded boxboard, virgin fiber-based top quality carton board, taking market shares from recycled fiber-based white-lined chipboard. You can, for instance, with our folded boxboard, you can basically with 30% lower basis weight, you get better characteristics, product folding characteristics, printing characteristics, a cleaner sheet, better looking board than with white-lined chipboard.

So, we see also migration there from the European 3 million tonne annual white-lined chipboard market into carton board. And in China, there is a 6 million tonne of white-lined chipboard or Duplex market that is gradually being substituted with the local folded boxboard. So, we cannot only look at the specific product segments as such. There is also important movements happening between these product categories.

But now over to you, Niclas, for the second question.

On the costs, so what comes to the previous programs, more than EUR 200 million, they are done. But as I said earlier, we are very active in terms of looking at our competitiveness, our cost base throughout. So, we'll continue with scrutinizing fixed costs. We'll continue with scrutinizing variable costs. We have, as discussed earlier, we have the programs with more than 4,000 initiatives, 800-plus initiative owners and they continue. And they are now -- it's not a program. It's more of a culture. And that we intend to keep up and if anything, speed up. At the same time, -- as you know, we made a big organizational change in the summer, 1st of July. We have 7 P&L responsible BAs, 22 P&L responsible BUs. And then we moved some of the functions to cut across the company. And now there, we are taking the next step and looking at how do we make this new kind of construction to make all it so more efficient.

And there's been some articles or some press picking up on some of our actions we are doing across, but that's just some of the actions we are doing a lot under the hood. And that's the whole idea. These are not programs per se, but we are day in, day out looking at how we make sure that we are competitive and create value for our customers.

Our next question comes from Lars Kjellberg with Stifel.

I got thrown out earlier due to power cut. Not helpful, but back on again. So essentially, a couple of questions for me still. Coming back to wood markets. Obviously, there's been an exceptionally tight market now in the Nordics. Now the industry certainly from the pulp and paper industry is not running full. Prices are starting to get a bit. But what is your thinking in an upturn in this market again in terms of the wood supply that is available?

And in that context, coming back to what you said earlier, Hans, about maximizing profitability. can you operate everything, including your new assets from a wood supply standpoint on a competitive level? The other thing that you mentioned earlier was disciplined capital allocation going forward. I just wanted to understand what does that mean? You put in a lot of money on growth. You continue to talk about growth. And if I'm looking at some of the markets you serve, in particular the consumer packaging, there's no growth in this market since 2016. The volumes are the same. So, how should we think in that context, your focus on growth versus what's happened in the market and in the context of capital discipline what does it really mean?

And the final point then. Holmen earlier today talked about stable generally prices on consumer boards for the contract business. But if you try to go after new volumes, there's a tremendous amount of pricing pressure. So the question is, what are you finding on that incremental volume that you're trying to place relative to the contract business in terms of pricing pressures?

Yes. Thank you very much, Lars. I'll let you take the second question, but a couple of comments. First of all, starting from your last question about pricing, yes, we see consumer board prices or board prices in general, stable. When we are now introducing our own new volumes to the market, very much we gain business, we gain volumes with yield advantage. Our folded boxboard, for instance, from Oulu has a 30% to 40% yield advantage compared to white-lined chipboard or SBS, some of the other board grades. So also with a higher price point for folded boxboard, you can basically prove to customers that the total cost of ownership goes down when they move to our grades instead of what they are using currently.

Then regarding -- and also one point on growth. If you look at Stora Enso during the last 10 years, you will notice that our core packaging business has been growing an average 5% per year. That's the growth we can demonstrate since 10 years back in our packaging business. So yes, our top line has been about unchanged, around EUR 10 billion, but we don't have basically any printing papers anymore and we have a significantly bigger packaging business. So, 10 years ago, packaging and printing papers were roughly equal size, representing almost 40% of our total turnover each. And today, packaging is representing 60%, whereas printing paper is almost 0.

When it comes to the wood costs and the supply and demand situation for wood in the Nordics, I think that we have seen here this year that the wood costs have reached the pain point, the pain levels. There has been significant curtailments in pulp capacity without mentioning any names of our competitors, but there have been very long curtailments, showing that when you are producing standard volume bulk pulp grades, it doesn't make sense to run at these higher wood cost levels. So, I think the proof is in the pudding, and we have seen that these levels basically forces the volume producers of pulp to take curtailments and shutdowns, extended shutdowns. And as I said, since the summer, we have seen wood costs now moving downwards.

But then over to you, Niclas, for the other part of it.

Yes. So Lars, on capital allocation, and this is something we'll come back to as well in the CMD, but as we all know, I mean, we've had over EUR 1 billion CapEx now for a couple of years. This year, we'll go down to some mid-700s and likely down from there somewhat. We've done a lot of work internally, thanks to great efforts by the team to kind of create -- really kind of categorize our assets, run for cash assets, key growth assets and so on. And we see that we can become more disciplined by just doing internally being very structured, having criteria, return criteria, of course, but also other criteria for where to allocate the capital when talking about CapEx.

So, there has been a lot of work going on recently on this, and we'll come back and explain a bit more what it means in detail. But CapEx is now on a downward slope. And as Hans said here earlier and as you know, we have made quite significant investments. Oulu is one, of course. De Lier, De Jong is another. And now going forward, we, of course, need to show the results of these and reap the benefits of them. So, essentially kind of no major CapEx kind of initiatives here in the near horizon. We have what it takes essentially to -- sorry, we have what it takes to grow essentially.

Yes. So in '26, what does that mean for CapEx? What do you think you're going to land roughly?

Let's come back to that. As you know, we are typically in the beginning of the year in connection with Q1. We'll give an idea of next year, but down from where we are this year.

We have reached the end of the time for the Q&A session. I shall now hand back to Hans Sohlstrom and CFO, Niclas Rosenlew, for closing remarks.

Well, thank you very much for your attention. Thank you for joining this call. And just -- we are powering ahead. We are focusing on profit, performance, as well as our portfolio to maximize shareholder value. That's our ultimate goal to create the best possible value to our shareholders.

Thank you very much. Looking forward to meet with you then in the next quarter. Bye-bye.

Hello, and welcome to Stora Enso's Second Quarter 2025 Results Presentation. My name is Jutta Mikkola. I'm the Head of Investor Relations. I'm joined by Hans Sohlstrom, President and CEO of Stora Enso; and CFO, Niclas Rosenlew.

The title of today's presentation is solid business performance in a volatile demand environment. The agenda will begin with key highlights and strategic focus areas presented by Hans. Then Niclas will review the company's financial performance, and then Hans will conclude with a summary of key takes and focus for 2025.

Thank you for joining us today. And I will now hand over to Hans Sohlstrom.

Thank you, Jutta. During the second quarter of 2025, we continued to make good progress in building a stronger and more competitive Stora Enso. While market conditions remain challenging, we focused on the areas within our control. Driving efficiencies, in-sourcing operations, commercial excellence, working capital and fixed costs. In addition, during the second quarter, we took significant steps to strengthen our strategic focus on Renewable Packaging.

To begin with, it's notable that all operational segments achieved positive adjusted EBIT for our second consecutive quarter despite continued weakness in board and pulp markets. Consumer demand remained at relatively low levels and was impacted by geopolitical uncertainty. Sales at EUR 2.4 billion grew 5% year-on-year, supported by high demand for food products and packaging solutions. Adjusted EBIT was EUR 126 million as the old ramp-up add an approximately EUR 50 million negative impact on the second quarter adjusted EBIT. Our continuous dedication efforts to improve cash flow resulted in operating working capital to sales of 7%, a decrease of 2 percentage points year-on-year.

During the quarter, we reached a major milestone with agreement to divest approximately 175,000 hectares of forest land equivalent to 12.4% of our total forest land holdings in Sweden for an enterprise value of about EUR 900 million. The value is in line with our Swedish forest book value. This transaction reduces our debt and enhances our financial flexibility as well as confirms the true market value, including a long-term wood supply agreement. Stora Enso will retain a 15% ownership and will enter into a 15-year wood supply agreement with a possible additional 15 years extension.

Following this, we initiated a strategic review of our remaining 1.2 million hectares of Swedish forest assets, reinforcing our commitment to attractive portfolio managing and shareholder value creation. As part of this review, Stora Enso will explore various options, including a potential separation and listing of the Forest business through a demerger into a new company that would be wholly owned by all Stora Enso shareholders.

Over the past months, Stora Enso has taken decisive steps to sharpen our strategic and operational focus. These actions are not isolated. They are part of a broader transformation, focusing on profit performance and portfolio with people in the center and to become a more focused Renewable Packaging company. These initiatives are guided by 3 objectives. Firstly, we are increasing strategic business and operational focus and simplifying the corporate structure. Secondly, we are realizing synergies and improving cost competitiveness. And thirdly, we are deleveraging and unlocking asset values.

This recent initiative, the sale of 12% Swedish forest and the strategic review of the remaining Swedish forest assets, the Oulu Consumer Board ramp-up, the acquisition of Junnikkala and the new leaner organizational structure marked a significant phase in Stora Enso's transformation. This puts Stora Enso in a good position to deliver sustainable value creation, both operationally and financially. We are building a more agile, focused and resilient company to maximize value and deliver long-term returns for our shareholders.

Let's then look more closely on the strategic rationale behind the recently initiated strategic renew of the Swedish forest assets. In June, we announced that we initiated a strategic review of our Swedish forest assets. With the review, we aim to enhance business focus and unlock the full potential of both our forests and industrial assets. Initiating this strategic review highlights our commitment to maximize shareholder value.

If we then look at the 2 different parts of the business. Stora Enso, the industrial part is a global leading Renewable Packaging company with sustainability at the heart of what we do. We have leading market positions with a customer-centric offering and one of the market's broadest offerings within packaging. We have a strong culture of innovation and sustainability underpinning the business. The business has a leading asset base with cost competitive integrated sites and diversified material supply, including pulp. With several ongoing initiatives, we are continuing to strengthen the company.

If we look at the Swedish forest, we are a leading Swedish forest owner with optimally located assets in Central Sweden with proximity to strong sources of demand such as pulp and sawmills. There are strong tailwinds when it comes to renewable materials and the forest is the raw material. And this will drive market growth in both short and long term. We are a leader in biodiversity, where we have a long history and culture. We have strong assets and an adaptive forest management. The Swedish forest is a source of consistent and strong cash flows and growth. We also see new emerging business opportunities within renewable energy, carbon credits and beyond. The rationale of the strategic review is to look at the 2 parts of the business and to conclude whether it is better to have them as separate businesses or continue as is.

As said, this is the start of a strategic review, and we have not concluded anything yet, but we have a clear hypothesis of what creates the best business and shareholder value, and we will come back with the conclusions of this review at the end of the year.

As said, we are in our strategy, emphasizing growth within Renewable Packaging. Nearly 80% of investments over the past decade have been allocated to this area. The following outlines approach and focus on enhancing synergies to support the profitability and growth of Renewable Packaging.

Let's start with our consumer board, the core of Stora Enso. This business includes liquid packaging board, bleached and unbleached, folding boxboard and barrier coated board for food and beverage applications. We serve global consumer-facing brands, which demand the highest standards in quality and sustainability. Stora Enso owns the 3 largest integrated consumer board mills in Europe including the most cost competitive Oulu site ramping up. These sites combine large-scale board production with integrated pulp manufacturing with efficient wood supply. This is a critical competitive advantage and highly valued by our global customers who rely on consistent quality across multiple sites.

Regarding the Oulu ramp-up, customer feedback on product quality has been very encouraging. While the ramp-up will continue to weight on earnings in the short term, we remain confident that all the board line will be very cost competitive and deliver some of the best quality products in the industry. This investment is central to our strategy of growth in Renewable Packaging.

Then if we look at our containerboard production, we produce fresh fiber-based liner in Finland and recycled fiber-based test liner in Poland. Our Langerbrugge Mill in Belgium currently produces newsprint and magazine paper. We have publicly stated our intention to convert it to testliner when market conditions and financials allow. Our largest liner customer is ourselves, enabling significant synergies between liner production and box conversion. We have conversion capacity across Poland, Sweden, Finland and the Baltics. In 2022, we acquired the young packaging group in the Netherlands, now the largest and most modern conversion facility in Europe. Conversion is a local business. Empty boxes are not economical to transport long distances.

Our strategy is not to be the largest converter, but to maximize synergies, especially between recycled fiber liner production and conversion. We have 2.5 million tonnes of market pulp capacity split evenly between eucalyptus pulp from Latin America and Nordic production. A significant portion is virtually integrated with our board mills with flows home the Nordics and Latin America to both Europe and China. We are increasing focus on this integration. Internal access to eucalyptus pulp reduces exposure to volatile markets and improve margins. No other European or North American packaging material producer has internal cost-efficient eucalyptus pulp access at this scale, giving us greater flexibility and optionality.

Coming back to wood supply, it's good to note that we have many assortments, including the recent acquisition of Junnikkala in Finland around our production sites. Our sawmills produce on top of sawn products, wood chips and sawdust, which are cost-efficient raw materials for our pulp and board mills. This is the strategic rationale behind the Junnikkala acquisition. You'll notice many new orange dots around Oulu on the map.

To sum things up, Stora Enso is establishing a strong position in Renewable Packaging, leveraging recent investments and strengthening the focus on integration, efficiency and cost competitiveness.

Now I will hand over to Niclas to go through our financial performance during the second quarter.

Thank you, Hans, and hello, everyone. Now let's look at our second quarter financial results, which marked a solid performance given the volatile demand environment and ramping up of our new Oulu line. In the second quarter, our sales increased by 5% bringing the total to EUR 2.4 billion. This growth was mainly driven by stable prices and improved deliveries. Structural changes had a smaller positive impact as both the Junnikkala acquisition and the Oulu consumer board line ramp-up increase the top line. Our adjusted EBIT decreased to EUR 126 million, mainly due to ongoing Oulu consumer board line ramp-up impacting second quarter results negatively by approximately EUR 50 million. Furthermore, as Hans mentioned, all segments achieved positive adjusted EBIT for the second time since the third quarter of 2022.

Now let's take a closer look at the EBIT bridge. Here, as you can see, the main impact in the second quarter is the Oulu ramp-up weighing on earnings. Adjusted EBIT was EUR 126 million, a decrease of EUR 27 million compared to last year. Price and mix had a negative impact of EUR 6 million, mainly driven by biomaterials with pulp prices coming down. This was more than offset by the positive EUR 12 million impact from higher volumes. Variable costs were flat as higher wood and paper for recycling costs were offset by lower energy, logistics and chemicals costs. Fixed costs decreased slightly. FX had a positive EUR 6 million impact. So in summary, solid performance with the main impact coming from the Oulu ramp-up.

If we then turn the focus to cash flow. The cash flow from operations was positive EUR 145 million and after investing activities, negative 37%. This was as expected, driven by the final investments at the Oulu site. When looking at EBITDA, you can see that it has been gradually improving since 2023. Even though market conditions have been and still are challenging, we have focused on the areas within our control, being enhancing sourcing, operational efficiency, commercial excellence, working capital and reducing fixed costs.

During the previous year, Cash flow from operations has benefited from the significant operating working capital reduction actions that were in focus throughout 2024. This focus on reducing operating working capital continues but naturally, the amount of decrease isn't as large as we saw in 2024.

On the other hand, when it comes to CapEx investments, the heavy investment phase related to Oulu is now coming to an end, and we expect CapEx to come down from the high levels of '24 and '23.

If we then turn to net debt, the ratio of net debt to the last 12 months adjusted EBITDA improved to 3.3x from 3.5 in the same period last year. Net debt increased slightly to EUR 4 billion as we are finalizing the Oulu project. As the intensive strategic CapEx phase of the last 2 years, nears finalization and profitability gradually improves. Net debt levels and the ratio are expected to improve.

In addition, when completing the divestment of the 12% of Swedish forest asset, which, as Hans mentioned, has an enterprise value of approximately EUR 900 million being in line with the Swedish forest book value, our net debt will go down further, which improves our financial flexibility.

Operating working capital to sales was 6.9%, which is an improvement of 1.8 percentage points year-on-year. The operating working capital reduction is stabilizing and we intend to keep it at this level and further decrease when possible.

So with that, let's move on to the segment performance. Starting with Packaging Materials. Sales increased slightly, driven by higher prices for containerboard and a slight increase for consumer board. Packaging Materials profitability declined primarily due to the ramp-up of Oulu. Adjusted EBIT was EUR 29 million, with Oulu accounting for a negative impact of EUR 50 million on adjusted EBIT. Deliveries excluding the new machine in Oulu, decreased slightly driven by weak market conditions in China. Fiber costs remained persistently at a high level, offset by lower other variable costs.

Packaging Solutions had a positive result for the second quarter in a row. Adjusted EBIT increased by EUR 4 million, driven by actions taken to improve the business as well as higher prices and reduced depreciation following the previously announced impairments. In general, markets continue to be challenging with both overcapacity and oversupply.

Moving from Packaging to Biomaterials. Biomaterials is navigating in challenging market conditions with a weaker pulp demand, a weaker dollar and lower prices. Sales decreased due to lower sales prices and a negative currency rate impact, partly offset by higher volumes. Adjusted EBIT decreased mainly due to lower sales prices. This was partly offset by lower costs as we continue to work on making the operations more efficient. Wood costs remained high.

On the other hand, Wood Products had a positive adjusted EBIT for the second quarter in a row. This was driven by higher prices and volumes partly offset by increased raw material and fixed costs.

Forest had another record high quarterly adjusted EBIT, reflecting strong operational performance and high prices. The Forest asset fair value is EUR 9 billion, equivalent to EUR 11.4 per share.

With that, I hand back to you, Hans, for the key takeaways and our focus areas for 2025.

Well, thank you, Niclas. We are confidently navigating through volatile markets, building a stronger, better, more resilient and more profitable Stora Enso by focusing on what we can control. We continue to work across the whole company to improve profitability, cash flow and cost competitiveness through a focus on sourcing, operational efficiency, commercial excellence, working capital and fixed costs. We are focusing on completing the sale of 12.4% of Swedish forest assets while also conducting a strategic review of the remaining Swedish forest assets, including the assessment of a potential separation and public listing of the Forest assets through a demerger. We focus on the ramp-up of production in the new packaging board line at the integrated mill in Oulu, to strengthen Stora Enso's competitive position.

I am proud of the resilience and dedication shown by our teams across the company. We are navigating through a volatile world with determination and discipline, and we remain firmly on track to deliver long-term sustainable value. Thank you for your continued support.

With that said, we are now ready to take your questions.

[Operator Instructions] Our first question comes from Robin Santavirta DNB Carnegie.

I have a couple of questions. First of all, related to the Packaging Materials segment, when I look at the Q2 earnings, the adjusted EBITDA of EUR 29 million. And then if I add the EUR 50 million sort of negative from the Oulu start-up on the adjusted EBIT -- anyway, the underlying adjusted EBIT would be some EUR 80 million. Actually, the best performance since Q3 2022. What is driving -- we know market environment is quite difficult. We can see Metsä Board, we can see Billerud performing quite weakly in comparison to a couple of past years. And now, in a way, your underlying paperboard business is clearly better than you have reported in a couple of years. So what are the key sort of elements driving that performance compared to peers?

Yes. Thank you, Robin, for the question. So well, first of all, as we said in the presentation, we have cost-efficient integrated board mills with big scale board production and then also integrated pulp production on-site as well as then sawmills on-site or close by to support the cost efficiency and wood supply. And so it's really about cost efficiency and then also high-quality products and long, very good customer relationships. I can say openly that I have never seen any company with this good -- continuously good customer satisfaction feedback.

I mean -- and I met now with about 50 of the largest customers, CEOs and this customer satisfaction is strongly confirmed by also top management of our customers. So doing the basics right and good in a cost-efficient way, that's, I think, the reason.

Would you say that the operational efficiency or the sourcing efficiency is now clearly better compared to 3 years ago. Is that 1 element? And if so, sort of the work done on that part? Or are there still sort of things to come to drive up the underlying performance?

Yes. To answer your first question, yes, we are much more efficient internally than we were 3 years ago, absolutely. We have made clear progress there, but there is much more to come. This is not a project. This is our new way of working, continuous improvement, and it's really roll-downs to our performance culture that we are -- we have strongly been developing and introducing into the company. We have thousands of initiatives identified to further improve our efficiency and we have hundreds of initiative owners working on these initiatives across the board. I'm truly proud of all the Stora Enso employees, how we have improvement actions ongoing in all mills, in all units, all sites. And that's the way how you can truly make a shift in competitiveness and performance.

And the other question I have is related to Oulu. Do you have the deliveries in Q2. What do you expect for the remainder of the year in terms of deliveries? And what segments are you producing and selling at the moment?

Well, we don't provide more precise guidance. We have in our report repeated the roughly 100 or slightly above total negative EBIT impact from the ramp-up. And we have guided before that we expect EBITDA breakeven in the fourth quarter. So we stick to that guidance. And as I said also in the report feedback on quality, both folded boxboard, CKB has been really encouraging and good from our customers. So we are aiming for the best product quality in the market.

Our next question comes from Ephrem Ravi at Citi.

Two quick questions. Firstly, on the Forest options that you are exploring. Does the Swedish forest include the stake in Tornator. And also, what is the thinking on either leaving out or putting in the Baltic forest also into that entity in terms of this way you're thinking about it strategically?

And secondly, on Oulu, it is -- I mean the previous guidance, I think, was for EUR 800 million of revenues from that mill over the medium term. Given the current market conditions, what kind of profitability would you expect in it from that business over the medium term, just for us to get a sense of the return invested capital that could be expected from that investment.

Yes. Thank you for the question. So the Swedish forest does not include Tornator, where we have a 41% stake in the Finnish Tornator forest company and nor Baltic forest assets. So it's purely Swedish forest, what remains 1.2 million hectare after the divestment of the 12.4% of our assets in Forest assets in Sweden. The book value of this remaining part is roughly EUR 6 billion. And when it comes to the Oulu ramp-up we have guided before that when fully ramped up in 2027, we're going to -- it is going to add about EUR 800 million sales to the group, and that's what we stick to. When it comes to profitability, we don't have any more exact guidance on that. So...

And just kind of if I can push you on the first point. Any rationale why Baltic forests are not part of that entity? If it is the book value of that asset to the market, I mean that would be a logical conclusion.

Yes. We want to keep this as a very clear pure Swedish forest company, 1.2 million hectares. It's a huge forest company, and as said, rough book value about EUR 6 billion. So it's a very concentrated focused in the mid of Sweden entity and therefore, also very, very manageable and clear also for investors from an equity and investment perspective.

Our next question comes from Charlie Muir-Sands of BNP Paribas.

I think the first one you'd actually already answered, which is to reconfirm the EBITDA breakeven target for Q4. I had a couple of others. So firstly, site continued high input costs, and I mentioned higher wood costs offsetting some folks elsewhere in Q2. I think some other people have started to talk about seeing on a look-forward basis, perhaps signs of pulp wood at least, if not sawlogs perhaps falling in price as we go into the second half. I just wondered if you're seeing any similar signs on that yourself which could clearly help your industrial business, but perhaps also to offset on the Forest side?

Yes. Thank you, Charlie. Yes, we see some signs. We see some early signs, but we think it's too early to draw any conclusions here.

So any quantification at all as to what you might be seeing so far?

Well, I mean we -- when it comes to wood costs and wood prices, we have seen some decline in the Nordics, in all the Nordic countries in the areas where we buy wood. But as I said before, I mean, we want to have a more fundamental change and to really be able to talk about the trend change. So it remains to be seen.

Understood. And then just one slightly technical question. Your depreciation guidance for the year is still EUR 610 million to EUR 660 million. You only booked to EUR 118 million in Q1 and EUR 123 million in Q2. That kind of suggests a big step-up into the second half, unless I'm missing a different moving part. I just wondered if that's the case, if there should be a big step up in depreciation as we move into the third and fourth quarters.

Let's -- that's a good point. And I mean, the -- let us come back to that offline. I don't have honestly, a good answer to that.

Our next question comes from Lars Kjellberg at Stifel.

So I just want to come back a bit to what you spoke, Hans, about accelerating synergies. As much as underlying earnings are starting to improve. The earnings still remain very low, appreciating we're challenged cyclical market, but at the same time, there seem to be a need for a structural change. You called out yourself is the supply. I keep harping on about the need for you to do something on your more structural. But obviously, in the light of today's presentation, you talk about synergies. So if you can sort of help us think a bit about what sort of opportunity you are seeing for that synergies to generate that further integration? And what hasn't already been done because you've owned these assets for quite some time. So that's my first question.

Yes. Thank you, Lars. Well, first of all, all our businesses made a positive result for the second consecutive quarter. And even if on a low level, so of course, our profitability targets are much, much higher, but it shows that the work, the hard work we have been doing on improving our cost efficiency, reducing costs and improving productivity pays off. And when it comes to the internal synergies, so we launched a new organization where one element is that we are organizing the -- we are organizing operational activities around integrates. So basically, the sawmills close to Oulu, which is the Veitsiluoto sawmill, the 3 Junnikkala sawmills, they are part of the Oulu business unit. So the integrated forms a business unit. So we optimize the totality there. And the same thing we have done in our other mills so that we integrate the nearby sawmills and wood products units with the local board and pulp manufacturing and forming them into P&L responsible business units.

So these business unit leaders, they are then in charge of maximizing the EBIT for those integrates, taking into account wood supply good products, so sawmilling, pulp production, board production, so the whole totality. And here, we see that there is potential to find further synergies.

Then as a part of the organizational change, we basically took out one management layer completely. So previously, between me as the CEO and the mills and the heads of sales, there were 2 management layers. Now there is one, the business area leaders. Then we have also moved functional staff on a group level in order to be able to streamline and to do more with less also in this area. And this is a process ongoing. So there is more to do here also when it comes to addressing synergies and addressing fixed costs in our company.

I'll push you a bit on that. Can you share with us what sort of margin opportunity or absolute number you're seeing? And just one more question. In terms of a potential spin-off of the Forest assets, would that require bondholder consent?

Well, on the first question, we don't disclose any targeted numbers here, but I can assure you, Lars, that we are doing our utmost to continue to streamline the company, to improve our cost position, to reduce both variable and fixed costs. So we don't give a guidance number on that. And perhaps, would you like Niclas to...

Yes, yes. On the kind of strategic review, Lars, no further comment on that. I mean we are in the midst, as you know, of the strategic review. So we'll come back by the end of the year with conclusions, including bond topics, but don't want to comment on it as we are...

But this is a factual context of bondholder consent needed or not needed?

Again, we are in the midst of the review. So let's go through that first. And when we concluded the review, we then come back.

Our next question comes from Cole Hathorn at Jefferies.

I'd like to start with the demand trends. We've seen a lot of commentary around kind of order books weakening and being a bit softer in June. And I just like a little bit of color what you're seeing from your customers and order books, particularly in Packaging Materials. And if you could differentiate between the containerboard and consumer board side, any trends that you'd like to call out as well as comment on the weakness that you were calling out in Asia?

Yes. Thank you, Cole. So first of all, containerboard market is quite stable and solid. You know that there has been several price increases implemented throughout the beginning of this year. Also order books are good. In containerboard, in consumer board, prices are stable on a somewhat higher level than last year and also somewhat higher than end of last year. And I would say, order books are satisfactory.

But it is absolutely clear that if we look at our packaging business, the demand is driven by consumer spending and we know that consumer confidence, consumer spending due to the macroeconomic environment, geopolitical uncertainties is on a relatively low level. So therefore, we can't speak about the really strong demand environment. So that's how I would put it. But I would say that it's a stable situation, but still on a relatively low level.

And then if I look at your EBIT bridge, your variable costs year-on-year, you talk about higher wood costs offset by some other lower variable costs and your profit improvement actions. But I'd like to push you a little bit more to try and quantify how material those profit improvement actions are and how visible they are for the numbers because we would have thought that the wood cost just on a year-on-year basis would still be a material drag. I mean, is it relief from the other cost buckets that is helping you get basically stable year-on-year variable cost?

Or is it really those profit improvement actions that are starting to come through? Because you've talked about it, but from the outside in, it's very difficult to put a number on those actions? And are those actions that kind of the wood sourcing, what would you identify as those kind of profit improvement actions that's really offsetting those variable cost increases in wood?

Yes. If I take that one, I mean you are right. I mean, if we dissect that variable cost flat kind of bucket. Wood and paper for recycling is a significant or was a significant drag in Q2, kind of similar to what we saw earlier. And then as an offsetting -- and we talk about a relatively significant amount, tens of millions. And then offsetting that, we had the others coming down.

And of course, there are certain kind of market movements. I mean we talk about energy, chemicals, logistics and so on. But as you rightly point out, there's a diligent day in, day out work related to -- I mean we mentioned -- Hans has mentioned before, the so-called value capture program and that continues very actively.

So in each mill, in each site, we have a number of activities addressing, for instance, chemical usage, how we source it and so on. So that's something that we -- is seeing in the costs as a positive and there's more to work on. We clearly have a good pipeline there also. I don't want to give an exact number because, again, it's a host of activities. Hans mentioned, thousands of activities affecting that. And then, of course, we have the market movements up and down in those logistics, for instance.

And then maybe a follow-up on the new organizational structure, which has been from, let's say, the 1st of July. But how the divisional management team incentivized to protect pricing in kind of a softer demand environment? And how are they incentivized to manage capacity to demand? And maybe following up on Lars' point, does this new organizational structure allow faster decisions if you do come to the conclusion that improving your mix and operating rates by trimming capacity to make way for Oulu is the right decision? Will your divisional team be able to act faster?

I would say on the latter part of your question, I would say, yes, I mean that's one of the objectives with this structure, a leaner, flatter organization, which is more agile. And the business area leaders and management teams are incentivized, among others, based on the EBIT generation. That's the part with the highest weight in the incentives.

And let's remember that in this new organization, we have actually pushed down P&L responsibility even further into the organization. So we have now 22 new P&L responsible business units, which are formed by the pulp board and sawmill integrates. So also the former mill directors are now P&L responsible business unit leaders in charge of that whole integrate. And also they are incentivized based on EBIT. So to maximize the EBIT of those integrate and thus contribute to maximizing the EBIT of the business area, that's the main driver.

If we look into sales, we have introduced also their margin steered sales incentives. So also our sales force incentivized based on margin maximization. And we all know that maximizing the margins, it's a function of price and volume. And the best way is really to have a total profitability margin steering of that so that, that's the way how we are driving also profitability and results in our sales actions. So optimizing price, volume, product, customer mix, there is a lot that we can capture in terms of value from these areas.

Maybe just to add what Hans was saying because this is quite a powerful change actually. And of course, we then also are making adjustments to the kind of management cadence, how we go through things monthly. We can clearly see from the group level down to these 22 BUs, how things are progressing and developing. We set clear targets also on the BU level and then also on the BA level and group level and so on. Naturally, as Hans was saying, 22 new P&L owners here, it will take a bit of time to see the results, but we are quite excited actually and confident that this, over time, will bring good things along.

Our next question comes from Linus Larsson at SEB.

It seems to me that you're increasingly focusing on your packaging businesses. And you also mentioned integration, internal synergies and that Europe map that you showed gave a very good overview, by the way. I just wonder how we should look at the parts of the business which are not necessarily or directly supporting the packaging businesses. On that map of yours, for instance, there are a number of sawmills which aren't adjacent to any packaging materials units and you also have a couple of stand-alone pulp mills, which aren't necessarily supporting the packaging businesses. I'm just trying to sense if there's any change in any way in your strategy when it comes to your non-packaging related businesses?

Yes. Well, thank you, Linus, for the question. So yes, you are absolutely right. I mean the strategic focus is very much on Renewable Packaging, representing today about 60% of our total sales and if we look at the last 10 years, about 80% of our investments have gone into this area. So that's really the area where we have been investing for growth, and we'll continue to invest for growth. We see that there is opportunities to develop and to create even more value, especially in this area of Renewable Packaging.

You're also right that there are for instance, some sawmills in Central Europe that are not directly synergistic with the Packaging Material business that is also visible in our new organization as from the 1st of July, they have been organized into what we call business unit wood products South. So it's basically the sawmills in Central Europe, which are not then part of the pulp and board mill integrates. And so all in all, as we mentioned in our presentation, we will continue focusing on profit performance and portfolio streamlining the -- and focusing the portfolio even further, but that's, I think, what we can now say at this time.

So today, in Europe, you are one of the biggest, if not the biggest sawmill operator. I'm not sure. Is that a position that you find desirable? Is that in line with your long-term strategy? Or is that something that you're also contemplating? I mean, you've been clear that you will leave no stone unturned and you're really reviewing all aspects of the group. So how do you look at that part of the business?

Yes. I mean repeating what we have said before, our strategic focus is on Renewable Packaging and growth within the area of Renewable Packaging. You are right. We are one of the largest sawmillers today in Europe. But our strategic focus is on Renewable Packaging growth moving forward.

But then, of course, many of the sawmills, especially in the Nordic region are very synergistic in supporting the cost efficiency of our Renewable Packaging, and that's also the strategic rationale for the Junnikkala acquisition. We bought 3 sawmills, one of them being brand new, top efficient, close to -- very close to our Oulu mill and therefore, also supporting to reduce the raw material costs in our Oulu integrate.

Okay. Great. And then just one follow-up on what you previously said on order books in Packaging Materials. Are you seeing some trends during the quarter? I mean, the end of the quarter compared to the beginning of the quarter. What sort of order inflow trends are you looking at right now?

Well, I would say, in general, U.S. President Trump's Liberation Day in the beginning of April caused uncertainty, in general, to the market and probably that could be seen as somewhat weakening the outlook, the confidence in the marketplace and on consumers and also customers partly going into more like a wait-and-see mode.

So as we all know, uncertainty is not good for economic and development and demand development in general. So I think that has caused some subdued outlook. But we are focusing on controlling what we can control. So we do our utmost to improve our competitiveness, cost efficiency, serving our customers better than ever before that's -- and producing top quality. That's what we are focusing on.

Our Next question comes from Pallav Mittal at Barclays.

Can you hear me?

Yes.

So a couple of questions. Following up on a question asked earlier. Given the weak demand conditions and weakening of order books, should we expect some potential closure in the near term in board or say, the pulp side of things? Or because you are focused on the Swedish forest review, these closures are not a focus right now? So that's the first question.

So thank you, Pallav, for the question. So all our businesses made positive results. Yes, we are far away from our long-term financial targets. So we have a lot of work to be done there. And I think that's how we can conclude on the first question. So we are -- even if we are operating in a high cost -- high wood cost environment in the Nordics, I mean, we are producing the highest added value forest industry product mainly. So consumer board where the price point is about twice higher than pulp and paper and thus also the added value is higher and that's also the impact of the wood cost is lower on the total cost structure. So the way to be able to be profitable and to deliver good margins in a high wood cost environment is to produce the highest added value, the most expensive product, which is consumer board, inefficient big integrates and that is exactly what we are doing in the Nordics.

Sure. And the second question I have is related to the strategic review. So of the EUR 300 million EBIT that you have done, more or less in the first half, the Forest segment is generating almost 60% of that total EBIT. So when you think about separating the Forest assets, essentially the remaining business will probably be a very lower margin business based on the numbers that I just highlighted. So when you are evaluating various decisions or various options, so how are you thinking about the split between your Forest and the remaining industrial assets?

Yes. So first of all, I mean, if you look at our Forest division today, I think it's important to remember that the Forest division EBIT includes also our 41% share of Tornator in Finland. There is also the whole wood trading part, which is a part of wood sourcing, which is also generating EBIT through sales, significant sales to external third-party. It's a part of our wood sourcing organization. So out of that EUR 300 million EBIT, it's only a part which will be part of the Swedish forest company if we would move forward after our strategic review in that direction.

And these are the things that we are looking into as part of the strategic review and of course, commit to come back when we have a conclusion on that clarifying, for instance, as you say, EBIT structures, how much would move or not move. So I would caution a bit and not draw too many conclusions yet based on how we report today.

Our next question comes from Detlef Winckelmann at JPMorgan.

Just 2 ones quickly from me, very technical. Just on your maintenance costs, if I go back, let's say, 2022 to 2024, on average, you were talking kind of between 500 and 550 somewhere there. And if I take your current up to H1 and then your kind of Q3 guidance, we're tracking quite far below that. Is that purely cyclical, i.e., lower profitability at the moment and therefore, we should expect it to go up again as your profitability improves? Or is this something that we should be your maintenance cost coming through more in Q4 this year? Is it a timing thing basically? That's my first question, please.

Yes. If I take that one. To some degree, it is a timing thing. So as we said, we will have a slightly higher maintenance costs now in Q3 compared to Q2, EUR 10 million, we said. And then typically, we also have quite significant maintenance plans for Q4. So in that sense, you will see more in second half.

And we've disclosed some of those plans also in our reporting, how it goes by quarter or which sites at least. But then, of course, goes without saying that maintenance is a pretty significant cost, as you say, it's also an investment. But that's part of what we are looking into as well, can we get more efficient? Can we keep our mills sites running with high-quality at the lower cost? So of course, that is part of what we are looking into as well.

Okay. That's perfect. And then keeping with maintenance, if we just go more specifically to Q2. I know we had a EUR 20 million roughly headwind from quarter-on-quarter. Are you able to split that between roughly speaking, between kind of Packaging Materials and Biomaterials?

Let's -- same answers previously. Let me come back or let us come back to that. I don't have it in the back of my head.

Our next question comes from Joni Sandvall at Nordea.

We can't hear you. Still not hear you. It seems to be a technical problem here.

We will conclude our questions for today. I shall now hand back to Hans, Sohlstrom and CFO, Niclas Rosenlew, for closing remarks.

Yes. Thank you very much for participation. As you can see, we are moving forward with determination and speed to build a stronger, more competitive and better, more valuable Stora Enso for the benefit of all our shareholders. Shareholder value maximization is our guiding star. And I also want to draw your attention to the fact that we are preparing for a Capital Market Day on the 25th of November taking place in London. So hope to see as many as possible of you also there. But until the next meeting. So thank you very much, and have a good day. Take care. Bye-bye.

Good morning, ladies and gentlemen. We are very happy to announce that we are initiating a strategic review of our Swedish forest assets, including the potential partial demerger in order to create Europe's leading stock listed, publicly listed forest -- pure forest company.

Next page, please. So this is a natural line in our development where we have been -- can I get the next page? Thank you. So this is a natural development of the focus on building a stronger, more valuable Stora Enso. We have taken lots of actions to improve our underlying profitability, our performance. We have 4 quarters in a row been able to improve our adjusted EBIT and our profitability. And that comes to a large extent through all the actions we are taking in order to improve our competitiveness and reduce costs. We have also, during the last 1.5 years, freed up about EUR 700 million from working capital, taking down working capital as a percentage of sales from above 14% to 7%.

We continue this work. We continue focusing on driving profitability and competitiveness of our company. And as other steps, recent announcement, we have announced in connection with our Q1 report, a leaner and more customer-focused organization to support our strategic objectives. And also a couple of weeks ago, we announced that the sale of 175,000 hectares, so representing 12% of our Swedish forest lands valued at EUR 900 million in the deal. And as we are retaining 15% ownership in the company, the cash proceeds are going to be at closing EUR 790 million to strengthen our balance sheet and to enable also development and further enhancement of competitiveness in our company.

So just as a reminder of the signed forest deal, this would mean that looking into 2024 figures that we are with the sale, losing some EUR 25 million of EBITDA. But out of this EUR 25 million, EUR 15 million is cash EBITDA. And we get, as I said, a valuation of EUR 900 million and cash proceeds of EUR 790 million. When we announced our intentions to divest 12% of our Swedish forest lands, we clearly said in October of last year that there are 2 objectives here. There is the objective, of course, to get cash to strengthen our balance sheet, but there is another very important objective, and that is also to clearly confirm and crystallize the true value of our forest assets in Sweden because this 12% is very representative for our total forest ownership in Sweden.

And all of this has been done. The deal has been signed with a long-term 15-plus, 15-year wood supply agreement. So really ensuring wood supply to Stora Enso's industrial operations and with a significant valuation and cash proceeds. So it's important to remember this deal as a starting point in a way for what we are now announced yesterday evening. So we are now initiating a strategic review of the remaining Swedish forest assets, so the remaining 88% in Sweden, which corresponds to 1.2 million hectares and a fair value of EUR 5.8 billion. These assets possess distinguished operational, strategic and financial profiles.

So in the forest business, we see opportunities to create steady income and cash flow, and we see significant value creation opportunities, as also in the same way in the renewable materials company where we have the strongest offering, we have leading market positions, and we have very cost competitive integrates and production operational activities. So the initiative here aims to further increase business focus, streamline operations even further and fully unlock the value of both the forest assets and Stora Enso's core renewable materials business, very much focusing on renewable packaging business.

We will explore various options, but we are clearly also highlighting here the potential separation and listing of our Swedish forest assets business through a partial demerger. And we believe this can be a value-creating and very interesting opportunity for strengthening of both companies in creating 2 Europe-leading companies in their fields, renewable materials with a focus on renewable packaging as well as at the same time, Europe's leading pure forest company with interesting value creation opportunities through new revenue streams related to, for instance, renewable energy, wind, solar, but also carbon capturing, carbon credits and carbon sequestration. There are new clearly visible value streams visible there.

Next page, please. All in all, our Swedish forests, 1.2 million hectares remaining after the divestment of 12%. They are hugely attractive. They are in areas with high productivity. They are managed in a very sustainable, extremely good way, which is also ensuring high productivity. And they are located, as you can see here, in the south or mid-south part of Sweden, where also the forest growth is higher than, for instance, in the more northern part of Sweden. So we have high productivity here, high growth. And this, of course, enhances asset value. They are also optimally located in mid-Sweden with a huge demand for wood, for saw-milling and pulp mills. There is a lot of demand here in the proximity in this region with the annual demand exceeding clearly the harvesting capacity. So very well located and therefore, also very valuable forest assets.

But now with these words, I hand over to our CFO, Niclas.

Thank you, Hans. And if we take the next page, please. And good morning, good afternoon, everyone. So just to build on what Hans was just saying, why are we doing this? How did we come up with this idea of doing a strategic review? Well -- I mean, the basics, of course, is self-evident. We are here to delight the customer. We are here to run a good business, a good performance and work with our stakeholders and create value. We have 2 distinct parts of the business. As you can see here, we've now pictured it as Stora Enso and then the Swedish forest asset. Both are really, really interesting. Both are really, really attractive businesses.

So if we start with Stora Enso, the industrial part. So Stora Enso is a global leading renewable packaging company. Sustainability is at the very, very heart of what we do. It's all about renewable materials. We have leading positions with a differentiated customer-centric offering. We have one of the market's broadest offering in packaging, if not the broadest globally. We have a very strong culture and drive when it comes to innovation and also sustainability, which then underpins the business. As Hans mentioned, we have leading asset base, cost competitive integrated sites and also diversified material supply, including euca pulp. And of course, a proven track record. And on that note, this is something that we -- as you know, we take very, very seriously.

We have a number of initiatives ongoing with already proven results to continue to strengthen the company and strengthen the performance. If we then look at the forest, and just to add to what Hans was saying already, we are the leading Swedish forest owner. We have optimally located assets in Central Sweden, which are in close proximity to pulp and sawmills. There are strong tailwinds when it comes to renewable materials. And of course, the forest is a critical raw material or the raw material for this. And this will drive market growth, both short term and long term. We are a leader in biodiversity, and this is something which we have worked on. We have a long culture, long history and also really, really strong assets and capabilities in biodiversity management.

The Swedish forest is also a source of consistent, strong cash flows and also growth in those cash flows. And then as Hans mentioned, beyond the kind of more bread and butter traditional businesses, we can also see emerging new businesses when it comes to renewable energy, carbon credits and beyond. So the rationale of the strategic review is really to look into these 2 distinct parts of the business and then conclude on whether it's better to have them as separate businesses or have them continue as is. And as Hans mentioned, of course, we have already made some thoughts and analysis, but this -- I want to reiterate here that this is a start of a strategic review. We have not concluded anything yet, but we do, of course, have a hypothesis here of what creates the best business value here.

We then move to the next page, please. Just briefly on the next steps. So we will now initiate the strategic review, and we will provide an update to you by the end of this year. And just as a reminder, we also do have already earlier informed you about the Capital Markets Day on the 25th of November 2025. So with that, I think we can open up for questions.

[Operator Instructions] Our first question comes from Lars Kjellberg with Stifel.

Curious, of course, to really understand what are the strategic options what you presented today. It seems like you pretty much shut case, this is the way to do this. What are the alternatives? The other one that I was thinking about, which is quite important in the context of this is I would assume that a separated forest asset can carry quite a bit of leverage. What are your thoughts on how much leverage it can take on and on what base? Is that the cash EBITDA? Or is it the EBITDA inclusive of the assets revaluation? And what was the other one I had. No, that's it, I suppose.

Yes. Thank you very much, Lars. And well, we have clearly outlined an option here in the stock exchange release. And of course, our job is to maximize shareholder value. So that's the leading star for making decisions in this strategic review. But as I said, there is an option very clearly outlined here. When it comes to leverage and balance sheet for the potential 2 companies, this is a strategic review. It's premature to take any stance on that. But you are absolutely right that our objective is to create 2 very strong entities in their fields, Europe-leading forest company with a stable and very predictable cash flow and also value creation upside by strategic focus and development on forest as a business.

And then at the same time, of course, our objective is to strengthen the renewable material company and to see to it that we also have a very strong P&L, but also a strong balance sheet. So of course, the forest company will have a lot of equity value and stable cash flows and both EBITDA and EBIT generation. But I think that's all I can say at this stage.

Lars, maybe I -- Yes. Just to add to that, I mean, it's -- as you hear, it's premature. We are initiating a strategic review. So I don't want to get into details about debt allocation. But in any case, as you know, debt management, debt reduction, investment grade is what we do here, what we aim for, that's very important for us. And if we would conclude that we have 2 strong companies, the same holds true for both of them. So strong balance sheet, investment grade, stable leading businesses.

Quick follow-up, if I may. You mentioned, Hans, the tightness of the market in that particular area. So I would assume that you, in the strategic review, would ensure similar to what you did with the divestiture, meaning having a significant forward-looking supply agreement if you go ahead to split the company.

We would -- in any option, we would secure long-term wood supply. And right you are, I mean, the sequence of event is there. I mean, the deal of selling 12% with a long-term 15-plus, 15-year wood supply agreement and then having with that deal, in a way, crystallized and clearly confirmed the value of the forests we have in Sweden because this deal is very representative. It also gives a good kind of an input and guidance for what we are looking for -- also for the rest 88%. But of course, with the difference that we are speaking about a partial demerger, we are speaking about a stock-listed entity with our shareholders, current or, let's say, future shareholders at the time of the demerger.

Our next question comes from Pallav Mittal with Barclays.

So a couple of questions. Firstly, if you could just clarify what you mean by partial demerger here. Is it that you're not spinning off 100% and you look to sell 60%, 70%, whatever and then sell the rest for cash? Because -- the reason I'm asking this is because it is slightly confusing in the statement because in -- you also go and mentioned that it will be split into a new company that would be wholly owned by -- all Stora and the shareholders.

So that is why it is coming to this confusion. So exactly what I'm trying to understand is what will the SpinCo look like? And how much of that will be distributed 100% or less? So that's the first question. And then secondly, if you do the spin, are there any operational or cost dis-synergies that we should be looking at plus any tax liabilities with the forest spin-off either for Stora Enso or for shareholders?

Okay. Pallav, if I take the first one. So again, just a reminder, we are initiating a strategic review. So we are looking at options, and we are highlighting one of the options here. But if we then -- to your question, one of the options is a partial demerger. And here, exactly as you say, there's, of course, different structures, but maybe the one which has been primarily in mind here is a tax-free spin, meaning that Stora Enso is split into a forest -- Swedish forest Stora Enso and the rest of Stora Enso and the forest asset is then given to our current shareholders or at the time of the spin shareholders. And that would mean 100% distribution, nothing remains with the Stora Enso Group. So 100% spin is what we are -- have as an option if we would conclude on a demerger and that an option there is to do it in a tax-free way for the tax-free.

Yes. And following up here on your -- the second part of your question. So basically, practically no dis-synergies. That's the way how we would manage this. And as Niclas said, in a tax -- without tax implications to our shareholders.

If I can just quickly follow up on the previous question from Lars around debt allocation. Clearly, you're not commenting on that. But is there any covenant issue with any of your bonds based on the one option that you are highlighting in the release?

No. No covenants. And again, I want to reiterate that whatever we conclude investment grade is what we are -- essentially, yes, what we are and what we will be also.

Our next question comes from Linus Larsson with SEB.

Many, many things to ask. Maybe I'll start with the potential buyback clause. So first of all, could you maybe share with us what the buyback clause looks like with the entity that has been agreed to be sold, which you're expecting to sell in the third quarter? And with whom with that buyback clause end up? Would it end up with the new potential SpinCo or the industrial entity? And also on that theme, how are you thinking around a potential buyback clause for the bigger forest entity? If you could just share a little bit on that would be super interesting.

Yes, Linus, thank you for your question. Well, first of all, in the 12% deal with the buyback clause, it's really -- it's there in order to ensure that we can continue the wood supply agreement another 15 years. So it's more a mechanism in order to really ensure that 15-plus, 15, so in total, 30 years of wood supply agreement, that's why the buyback clause is there for Stora Enso, so one sided. And it would be theoretically the industrial, the renewable materials company who has that also in the case of this demerger and creation of a new stock-listed entity. And then when it comes to, let's say, a partial demerger and creation of a publicly-listed forest, the pure forest company, of course, there cannot be any buyback or similar arrangements in that case.

Our next question will come from Charlie Muir-Sands with BNP Paribas Exane.

The first thing is just related to the way you currently report. I think your Forest segment reported EUR 364 million of EBITDA last year. I just wondered how much of that would be attributable to the Swedish forest assets? Obviously, for 12%, it only seemed to be EUR 25 million. So some clarity against the actual contribution of the rest of that segment would be very helpful. And also whether you could clarify on the free cash flow basis, how much that will be either pretax or post tax?

And then secondly, just going back to the 12% that you did sell and just trying to understand the rationale now for a spin or partial spin as opposed to selling more for cash proceeds. I wondered if you could just talk about the level of interest you got beyond the successful winning consortium that paid 1x book because I think you previously had indicated that, that was the minimum level you would be willing to sell at. So I just wondered whether there was sort of a depth of interest or whether you kind of exhausted what was like an interesting avenue to crystallize forest valuation through actual cash sales. And therefore, how much of this consideration of a spin is sort of plan B having exhausted plan A?

Thank you very much, Charlie. Well, first of all, I mean, the whole idea with this 12% forest sale, as we said in October of last year, is really to crystallize the value. And therefore, a good proxy when you -- if you try to estimate the EBITDA for the 1.2 million -- remaining 1.2 million hectares, you can use the -- as we said, the EUR 25 million EBITDA for the 12%, if you take last year's figures. But please remember that out of that EUR 25 million, EUR 15 million is cash EBITDA and the rest is basically value appreciation. So that gives a good kind of a proxy for what we are speaking here about when estimating for the rest.

And of course, we'll -- if there is the final decision and when there is, we'll come back with more precise figures there. And then I'll let you answer the free cash flow question, Niclas. When it comes to the 12% sale, there was a lot of interest. And that also, in a way, encouraged us when it comes to maximizing value for our shareholders and for the interest of both the company -- the companies and for our shareholders to take this next step when it comes to the strategic review of creating Europe's leading pure forest company. So if you answer the cash flow part?

I mean not much to add on the cash flow. I mean we are again -- we are kicking off a strategic review, so it's far premature to kind of discuss cash flow of the entities. But as Hans said, I mean, the 12% sale is kind of a proxy that's out there.

Great. And so just to clarify, the residual of that forest segment's profitability, that's related to kind of internal markup on externally sourced forest business and the profits from other elements. I mean I know that Tornator is equity accounted. So there's not much other fully consolidated forest. So just where the extra profit comes from in that segment then?

Again, we are initiating a strategic review. We can go through the current reporting in more detail. But at this stage, we just have to wait a bit and see what we conclude on the strategic review. And of course, at that stage, we'll open up and depending on what we conclude.

Our next question comes from Cole Hathorn with Jefferies.

I'd just like a bit of color on the discussions you've had with your key shareholders because they have a significant portion of the voting rights. Should we interpret this strategic review as the key shareholders are supportive of you exploring all avenues, including private sales to further insurance consortiums? Or is there any avenue that you are getting more pushed down just to understand what is actually on the table, insurance consortium, stale, spin, what are the options that you're exploring?

And then secondly on how this will work because you've got 2 avenues for your business, you've got realizing value through what is effectively financial engineering on this forest spin to get value for shareholders, but also the operational turnaround of your industrial assets. How do you ensure that management time is also allocated to the underlying turnaround of your traditional packaging businesses?

Yes. Thank you very much, Cole. Well, first of all, naturally, our 2 anchor owners are deeply engaged here and also very supportive for this strategic review, exactly as we have outlined in the stock exchange release where we clearly outlined one avenue forward. There was also from the Wallenberg family investment company, FAM, who is the anchor owner in Stora Enso, a separate press release following our press release where they outlined their support for this strategic review, and they also stated that if the strategic review would end up in 2 leading companies, a leading European pure forest company and a leading renewable materials and packaging company, they would remain as -- want to remain as anchor and strategic owners in both companies.

Of course, the Finnish state through Solidium, the other anchor owner in Stora Enso is also engaged here. And of course, they have also expressed to us their support of this strategic review. And yes, right, you are, Cole, let's remember that the most important thing for Stora Enso is the underlying performance, our financial performance, our profitability, serving our customers better than ever before, operating our mills and plants more efficiently than before with higher productivity. That is our key focus. And we have done great progress there, as you have seen in our quarterly reports, and we will continue on that path and focusing on that so -- but at the same time, also, of course, looking into our structures.

It's very much partly engaging at least to a large extent, different people and teams, but we are committed to creating shareholder value. That's our absolute key target. And for that, we need underlying performance, profitability, cash flow, strengthening our balance sheet, working capital efficiency, but we also need to look into our structures as we have announced here.

Hans, then maybe if you allow me a follow-up. I know it's early days, but when you put out a public announcement often triggers more interest. So if a consortium of maybe some insurers come and approach you to take the full amount private, what would you do with ultimately the cash flow? If you had a similar structure as the 12% stake, does Stora Enso has the flexibility to either return the cash as special dividends or investigate buybacks for the shares? Is that an option that's on the table, if you're approached for that deal?

I think it's speculation and every proposal that our company would get would be handled by our Board of Directors, but I think it's speculation. We have now published a stock exchange release with a very clearly outlined option and avenue for the future.

There are no further questions. I shall now hand back to CEO, Hans Sohlstrom; and CFO, Niclas Rosenlew, for closing remarks.

Well, thank you very much for participating here on a short notice. As you can see, the actions we are taking and also the strategic review is really showing our deep commitment to maximize shareholder value. That's the most important target for us in the management, for me personally, also for our Board of Directors, and that's what we are doing. We are seeing to it that we are maximizing shareholder value for the benefit of all our owners. Thank you very much for joining in here, also happy mid-summer for those who are celebrating mid-summer and looking forward to speak to you then in our next webcast. Thanks a lot. Take care. Bye-bye.