Billerud: North America remains strong as Europe faces pressure
Billerud reported its results for the period January–December 2025, highlighting a continued strong contribution from North America and decisive actions taken to strengthen competitiveness in Europe amid challenging market conditions.
Commenting on the results, President and CEO Ivar Vatne said that the fourth quarter developed largely as expected, reflecting very different market realities across regions. Volumes were weaker than anticipated, mainly due to subdued board demand in Europe and Asia, while market conditions in the United States remained more favorable. North America once again delivered a strong quarter, with an EBITDA margin of 20%.
For the full year 2025, North America continued to perform at an excellent level, contributing around half of the Group’s EBITDA and one third of net sales. In Europe, demand softened after a strong first quarter, with oversupply intensifying during the year and increased competition, particularly in liquid packaging board in Asia. Despite this, the liquid packaging business remained a key flagship category.
Vatne highlighted that swift actions were taken to strengthen competitiveness, including the launch of a comprehensive cost-saving program and a strong focus on working capital discipline, which significantly improved cash flow conversion. Sustainability targets were also met, with lower carbon dioxide emissions and improved safety performance.
In North America, Billerud continued to strengthen its position as a local partner, benefiting from a more positive economic environment and opportunities for growth. Progress was made in evolving the portfolio towards packaging materials, including advancements in coated kraftliner and cartonboard, and the successful completion of the Escanaba woodyard upgrade on time and within budget.
In Europe, the packaging industry continued to face severe headwinds due to muted consumer demand, oversupply and elevated input costs. Billerud expects capacity rationalisation to intensify over time and remains focused on improving operational excellence and cost competitiveness.
Looking ahead, market conditions in the first quarter of 2026 are expected to remain broadly unchanged. Nordic pulpwood prices have already fallen by around 20% from peak levels in mid-2025, with further decreases anticipated in 2026, supported by increased wood availability following storms in Sweden. From the second quarter, Billerud expects additional benefits from lower pulpwood costs and increased savings from its cost-reduction programme.
The company also announced its decision to exit the joint venture with Viken Skog AS to build a bleached chemi-thermomechanical pulp (BCTMP) facility in Follum, Norway, due to changed market conditions and a lengthy environmental permitting process. Despite the exit, cooperation with Viken Skog will continue in other areas.
Vatne concluded that, despite geopolitical and trade uncertainties, Billerud is well positioned with strong local production in both Europe and North America, a solid financial position and a flexible asset base. Key priorities for 2026 include strengthening European performance and further advancing the shift towards packaging materials in North America.
Key highlights
On a currency-neutral basis, sales declined by 14%, mainly driven by lower board sales in Europe and Asia. North America once again delivered excellent profitability, while earnings in Europe were negatively impacted by weak demand and persistent oversupply. During the year, Billerud implemented cost-saving measures, reduced investments and benefited from accelerating decreases in Nordic pulpwood prices. The Board of Directors proposed a dividend of SEK 2.00 per share (SEK 3.50).
Quarterly performance
In the fourth quarter, net sales decreased by 19% to SEK 9,238 million (SEK 11,468). Adjusted EBITDA amounted to SEK 818 million (SEK 1,443), corresponding to an adjusted EBITDA margin of 9% (13). Operating profit reached SEK 395 million (SEK 1,091), including items affecting comparability of SEK 272 million (SEK 373). Net profit totaled SEK 304 million (SEK 806), with earnings per share of SEK 1.22 (SEK 3.24).
Outlook for Q1 2026
For the first quarter of 2026, Billerud expects sustained solid performance in North America. Market conditions in Europe and Asia are anticipated to remain weak, with continued pricing pressure. Lower pulpwood costs are expected to support results, while the loss of free emission rights and higher planned maintenance costs will have a negative impact.
