Speaker #1: Good morning and welcome to Stora Enso's Q3 2026 results presentation. I am Jutta Mikkola, Head of Investor Relations. And joining me today are our President and CEO, Hans Ulström, and our CFO, Niklas Rosenlev.
Speaker #1: There is quite a lot happening at Stora Enso at the moment. Alongside delivering an improving the performance of our businesses, we are preparing for one of the most significant steps in reshaping our portfolio: the planned separation of Bergslaget Skogar.
Speaker #1: So today we will look both at how Stora Enso performed in Q3 and at the work underway to build two stronger and more focused companies.
Speaker #1: Hans will start with the highlights of the quarter and the progress we are making on our strategic priorities. Niklas will then take us through the financial performance.
Speaker #1: And as usual, we will finish with Q&A. With that, let's get started. Hans, over to you.
Speaker #2: Thank you, and hello everyone. As Jutta said, there is a lot going on, and we made further progress on several fronts during the quarter.
Speaker #2: In the third quarter, we continued to make steady progress with organic growth of 2%, supported by our own actions. AI is increasingly helping us accelerate our value creation programs and identify further opportunities to improve performance.
Speaker #2: Despite high planned annual maintenance activity, as well as higher costs related to the conflict in Iran, we delivered an adjusted EBIT margin above 7%.
Speaker #2: This is further evidence that our strategic priorities and portfolio optimization are gradually strengthening the quality and resilience of our earnings and cash flow. This brings me to another important step in our transformation.
Speaker #2: We have now formally decided to proceed with the planned separation. In just a few days, we will host the very first Capital Market Day of Bergslaget Skogar.
Speaker #2: Over the past year, significant effort has gone into preparing Bergslaget Skogar for life as an independent company. At the CMD, we are presenting Bergslaget Skogar's financials and showcasing a business with a unique asset base, a strong foundation, and long-term value creation potential.
Speaker #2: The separation will unlock value and sharpen the strategic focus of both companies. And when talking about focus, we have also continued to actively reshape our portfolio in line with our strategic priorities.
Speaker #2: We divested our packaging solution units in Germany, consolidated sawmilling in the Oulu region, and closed the CLT unit at Gruevern, enabling us to concentrate production in our remaining CLT units in the Czech Republic and Austria.
Speaker #2: We also announced plans to centralize our packaging solution operations in Finland and reduced our ownership in a Swedish wood supply company. All of these actions follow the same logic: creating a more focused company and directing our resources toward the areas where we see the strongest potential for long-term value creation.
Speaker #2: We are also continuing to develop further growth opportunities. This week, we announced a partnership with Shenzhen Technology, one of the world's largest suppliers of battery anode materials.
Speaker #2: The partnership accelerates the development of Lignod, our wood-based sustainable battery material, and its industrial-scale validation through a demonstration line for lignin-based anode materials. It also supports our long-term ambition to establish large-scale Lignod production in Europe.
Speaker #2: This is a good example of how our renewable materials expertise can create new high-value growth opportunities over time. One of our key strategic priorities is to expand margins through business focus, a positive performance culture, and systematic value creation.
Speaker #2: This has been a core priority throughout the last two years, and continues to be so going forward. We have identified €500–700 million of value creation initiatives; these initiatives have clear ownership and are already underway.
Speaker #2: Year to date, our own actions continue to improve performance at a steady pace and will continue to do so. At the same time, market impacts have remained mixed.
Speaker #2: Lower wood costs were supportive, but this was partly offset by ongoing war-related pressure on energy, logistics, and chemicals, subdued consumer confidence, lower EU ETS allowances, and unfavorable foreign exchange movements.
Speaker #2: Oulu continued to improve year on year. The key message is that the fundamentals of our margin expansion story remain intact. We are not standing still, and we are not waiting for market conditions to improve.
Speaker #2: We continue to drive performance through our own actions, and AI plays an important role in that. AI is increasingly becoming part of how we execute our value creation program, and it identifies further opportunities.
Speaker #2: All our employees currently have access to at least three AI capabilities, including our internal agentic AI library. AI is integrated into our performance culture and systematic value creation work.
Speaker #2: We focus on AI value—that is, measurable business impact—as the main KPI for AI. Today, targeted AI capabilities support around a quarter of our initiatives, particularly across commercial processes, operations, and ways of working, and we expect its role to increase over time.
Speaker #2: In practice, this ranges from enterprise AI tools supporting everyday work to our own AI applications and solutions, embedded in specific workflows and core business processes.
Speaker #2: For example, in sales, AI-powered negotiation support brings together customer, market, and internal data, helping our teams prepare faster, make better-informed decisions, and improve commercial outcomes.
Speaker #2: In operations, predictive AI helps us identify potential equipment issues earlier and reduce unplanned downtime. With that, I will hand over to Niklas to take you through the financial performance.
Speaker #2: Niklas, please.
Speaker #3: Thank you, Hans, and hello everyone. Before going further into the third-quarter financial performance, I wanted to start with a few comments about the Bergslaget Skogar separation and the impacts on Stora Enso.
Speaker #3: As you know, today we have made several releases on top of the Q3 interim report release. As part of the demerger release, we have, for the first time, shared the Bergslaget Skogar financials.
Speaker #3: This is another big step towards the planned demerger, and you can now see what Europe's biggest pure-play forest business looks like. More will be shared in the CMD next week.
Speaker #3: So let me now take you through a few points on what the demerger means for Stora Enso after the separation. This slide illustrates the impact on our sales, earnings profile, and balance sheet following the demerger of Bergslaget Skogar.
Speaker #3: First, the impact on reported sales is expected to be limited. Bergslaget Skogar's sales have historically been largely internal within the Stora Enso Group. Second, on an illustrative basis, excluding Bergslaget Skogar, our last 12 months' adjusted EBIT would have been around €400 million, compared with €580 million for the group.
Speaker #3: This corresponds to an impact of under €200 million on our current EBIT margin. However, it's good to note that adjusted EBIT includes the operational fair value changes in biological assets, which affect adjusted EBIT but are non-cash.
Speaker #3: In other words, the cash impact will be less. And third, the balance sheet: Around €800 million net debt is expected to be transferred to Bergslaget Skogar at the completion date.
Speaker #3: This will reduce Stora Enso's absolute net debt and align the capital structure with the size and needs of the remaining business. So, while the demerger reduces absolute earnings, it also creates a more focused Stora Enso with a clearer financial profile and a balance sheet aligned with the business.
Speaker #3: This is a good basis for continuing to strengthen Stora Enso. Now let's look into the Q3 results in more detail. I am pleased with the continued progress of all our businesses and the improved earnings resilience.
Speaker #3: During the quarter, we continued to focus on our own improvement actions across the company. Organic sales increased by 2%, driven by higher deliveries in both Consumer and Integrated Packaging, and higher prices in Integrated Packaging and Biomaterials.
Speaker #3: Reported sales decreased by 2% due to portfolio optimization and the divestments that Hans mentioned earlier. The divestments included the corrugated board units in Germany and a partial disposal of our share in a wood supply company.
Speaker #3: We therefore now account for the wood supply company as an associated company, instead of a subsidiary. The divestments reduced sales, but had a limited impact on EBIT.
Speaker #3: Our adjusted EBIT was €161 million, which was a year-on-year increase of 28%, or €35 million. So let's now turn to the next slide for some additional details.
Speaker #3: So, on the EBIT bridge, you can see the improved resilience that I mentioned earlier. Adjusted EBIT improved by €35 million year-on-year, despite continued external pressure.
Speaker #3: Higher volumes were the biggest positive driver, contributing €31 million, mainly from Consumer Packaging and Integrated Packaging. This was despite the planned maintenance shutdowns that we had in Integrated Packaging.
Speaker #3: Price and mix had a €12 million negative impact, as higher prices in Integrated Packaging and Biomaterials were offset by lower external wood sales prices in Sweden.
Speaker #3: Variable costs improved by €40 million. Lower wood costs and our own cost actions more than offset the cost escalation related to the Iran conflict, especially for energy, logistics, and chemicals.
Speaker #3: And importantly, our own actions also more than compensated for fixed cost inflation. So, quarter after quarter, we are making steady progress. We remain focused on what we can influence ourselves, and that work is increasingly visible in our results.
Speaker #3: Let's now move on to cash flow. Cash generation remains a strategic priority. Cash flow from operations increased to €245 million, and cash flow after investing activities improved to €132 million, compared with €57 million last year.
Speaker #3: This improvement reflects stronger cash flow from operations and lower cash spending on capital expenditures. Due to disciplined capital allocation throughout this year, we have also lowered our full year '26 capital expenditure estimate from €550 million to €500 million.
Speaker #3: Overall, the underlying development remains aligned with our priorities. We are reducing CapEx, improving the quality of the portfolio, and maintaining capital discipline.
Speaker #3: This is also visible in our balance sheet. The positive cash flow in the third quarter reduced net debt further. Net debt decreased by €85 million to €2.5 billion, and net debt to adjusted EBITDA improved to 2.1 times.
Speaker #3: The stronger capital structure provides flexibility to execute our long-term strategy and supports the preparations for the planned separation of Bergslaget Skogar. Going forward, we'll continue to focus on deleveraging, supported by profitability improvement, cash generation, and disciplined capital allocation.
Speaker #3: So let me now conclude the financial review with the segment performance overview. When it comes to sales, we grew organically in all operational segments. In Consumer Packaging, EBIT increased by €26 million.
Speaker #3: The improved performance was supported by higher board volumes, lower wood costs, and our own cost-saving actions. This was partly offset by cost increases related to the Iran conflict, particularly in logistics and chemicals.
Speaker #3: Looking ahead, the consumer packaging fourth quarter will be impacted by significant planned annual maintenance shutdowns. This will result in higher costs and lower volumes.
Speaker #3: As the maintenance will particularly affect our liquid packaging board production, we also expect an adverse price mix impact. Also, in Integrated Packaging, EBIT increased by €25 million.
Speaker #3: The underlying profitability remained solid despite significant annual maintenance shutdowns at several sites. The improved container board pricing and successful post-maintenance ramp-ups supported the performance.
Speaker #3: Higher variable costs driven by increased costs related to the Iran conflict were offset by good fixed cost control. Furthermore, biomaterials continued to demonstrate strong competitiveness with solid margins, despite the challenging operating environment.
Speaker #3: Adjusted EBIT was €52 million, corresponding to a margin of 14%. Higher eucalyptus bulk prices and good cost control supported the performance. In the other segment, sales declined mainly due to the disposal of our share in the wood supply company, as we no longer consolidate its sales.
Speaker #3: However, the disposal has no material impact on our operating profit. The adjusted EBIT in Segment Other was €13 million. The decline was mainly due to lower prices for external wood sales in Sweden and lower margins in the energy function.
Speaker #3: The energy business was negatively impacted by the annual maintenance at the Olkiluoto 3 nuclear plant and lower electricity prices. So with that, I hand back to Juhans for the key takeaways.
Speaker #1: Thank you, Niklas. Let me now summarize the key takeaways and our focus for the rest of the year. I am encouraged by the progress we are making, both in our performance and in advancing our strategy.
Speaker #1: We have many exciting and important steps ahead, with the Bergslaget Skogar Capital Markets Day being the next one. While market conditions remain challenging, we remain firmly focused on what we can control.
Speaker #1: We continue to drive performance through our own actions across operations, cost, commercial excellence, and procurement, and more and more with the help of AI.
Speaker #1: These actions are strengthening our competitiveness and positioning us well for the future. We are making good progress, but we also know there is more work ahead.
Speaker #1: We will continue to execute with focus and determination. I would like to thank our shareholders, customers, and other stakeholders for the trust they place in us.
Speaker #1: Most importantly, I want to thank our employees for their continued commitment, hard work, and determination. Together, we are actively shaping our future and building a stronger, more focused, and more sustainable Stora Enso.
Speaker #1: Thank you for listening. We are now ready to take your questions.
Speaker #2: If you would like to ask a question, please use the raise hand function at the bottom of your Zoom screen. When it is your turn, you will receive a prompt to be promoted as a panelist.
Speaker #2: Please accept. Wait a moment, and once you've been introduced, you may unmute yourself, turn your video on, and ask your question. Please only ask two questions at a time.
Speaker #2: If you wish to ask more than two questions, please rejoin the queue. Our first question comes from Gabriel Simonich at Goldman Sachs. You may now unmute your audio, turn on your video, and ask your question.
Speaker #4: I'm Niklas, and thank you very much for the call and for taking my questions. So the first one would be on the forestry side.
Speaker #4: So I know we should have more details on the forestry in the CMD next week, but I just wanted to confirm a few things on the free cash flow calculation for the number you announced today.
Speaker #4: So I wanted to confirm whether this cash flow excludes the interest on the debt and the tax to be paid. And if you could confirm how much you're considering for capex, and if that's mostly maintenance, that would be great.
Speaker #4: The second question that I have is actually on the Consumer Board division. We've started to see some players announcing price hikes on boxboard recently.
Speaker #4: So I just wanted to understand whether this is something you were following, and how you're seeing the situation in this market currently, given that this was an oversupplied market up until very recently, at least.
Speaker #4: And I just wanted to understand whether the situation has improved on the demand front, or if you're seeing further announcements on closures.
Speaker #4: Thank you.
Speaker #1: Yeah. Hey, hey Gabriel, Niklas here. So, on the first one, if you don't mind, let's come back to that in the CMD next week just to clarify.
Speaker #1: So I don't say anything which is completely off here. Yes. And Gabriel, good morning also from my side. On the second question about board price hikes—yes, we have seen in container board several price increases throughout this year.
Speaker #1: In Consumer Board, we have also recently announced price increases. The market situation in Consumer Board is not as tight and strong as it is in Container Board.
Speaker #1: And then when it comes to closures, you're right, there has been a lot of capacity closures taking place. In fact, if you look at the years 2024, 25, and year to date 2026, there is in total 750,000 tons of carton board capacity which has been taken out from the European market.
Speaker #4: Perfect. Thank you.
Speaker #2: Thank you. Our next question comes from the line of Lina Larsen at SEB. You may now unmute your audio, turn your video on, and ask your question.
Speaker #5: Good morning gents. Hello everyone. First question, maybe on the cost outlook and you did illustrate how variable costs have developed year on year. Could you please also share with us how variable costs developed quarter on quarter in the third quarter and maybe if you could add a little bit of detail on how you see variable cost developments into the fourth quarter please.
Speaker #1: Yeah. Hey, hey Linus. So yeah, so so if we take a step back, so the the variable cost we had a a tailwind of course it's it's a combination of two things.
Speaker #1: I mean, we had the wood prices, and then on the other hand—or actually, three things. So, wood costs, we have the Iran-related cost increases, and then we have our own actions.
Speaker #1: And it's, it's the mix of those. And of course, Iran moving in the wrong direction. Wood costs were kind of a tailwind in Q3, and then the own actions continue.
Speaker #1: Again, I don't want to be too specific about Q3 or Q4 going into Q4. But on wood costs, I would not assume that they continue to go down a lot.
Speaker #1: Maybe, maybe even the contrary, but let's see. The own actions, of course, we continue, and the Iran costs increases are there. So, of course, as we know, every day is a new day.
Speaker #1: So it's a bit hard to say, but but don't see any significant kind of easening at least now going into Q4. Hopefully that's at least some sort of an answer.
Speaker #5: Yes, good, good. And then maybe, in light of the cost environment that we're in, and maybe especially your continental European competition, could you share with us how you see potential prospects for market share gains or price gains, for that matter?
Speaker #5: And I'm talking about consumer packaging in particular, but but also maybe if you're you're willing to say something about OLO, any any any any possibilities prospects opportunities for market share gains overseas or or in Europe and and also like said what what what what's costs doing to pricing in this kind of environment.
Speaker #1: Good morning, Linus. Yes, we continue to grow faster than the market, so we gain market share continuously in consumer board both in Europe and also in North America.
Speaker #1: And in the same thing also in fresh fresh container board. So kraft liner, where the market situation right now is quite good actually.
Speaker #1: So that offers growth opportunities. So we had an organic growth of 2% in the quarter year on year. Our target is 4% per year and we are determined to continue growing faster than the market.
Speaker #1: And we have a very strong, competitive asset base for that. We have invested heavily during the last few years, so we have a very competitive asset base—huge mill integrates. And now it's time to harvest.
Speaker #1: Maybe just to add to what Hans was saying, I mean this is this is I'm sure obvious to you, but when we talk about the cost headwinds hitting the market related to the Iran conflict, for us it's it's really logistics and chemicals where we see it.
Speaker #1: But of course for for the industry as a large also energy is is is a big headwind. For us energy is not a major headwind as as as we are we are pretty much self-sufficient.
Speaker #1: So, in that sense, it's, if you can say so, a good thing from a competitiveness perspective.
Speaker #5: Great. Many thanks.
Speaker #2: Our next question comes from Andrew Jones at UBS. Please unmute your line by pressing star 6 on your keypad.
Speaker #5: Hello. Hello. Can you hear me? Hello.
Speaker #1: Morning.
Speaker #5: Oh, morning. So yeah, I just wanted to ask about the the league node business. I mean a few years ago there was a bit of a bit of a concern that it would result in you know a decent boost in in capex.
Speaker #5: I mean what does this actually mean practically? I mean what's what's what are your expectations for this business over the next few years? I mean if if you're work is successful, I mean when do you expect to actually start developing an industrial scale project and you know can you give us an idea basically how you're thinking about that and how imminent any large spending might be?
Speaker #1: Yes, so thank you for your question, Andrew. I mean, we have continued, of course, actively to develop the whole lignin node business. We have, since years, a pilot manufacturing unit in place.
Speaker #1: We have been collaborating with all the world's largest battery manufacturers, and also anode material manufacturers. Now, this week we announced the partnership with Shenzhen, who is the world's second largest anode material manufacturer, with a global market share of about 14%.
Speaker #1: They are a leading one. And together with them and with this partnership, we can now accelerate the demonstration phase of League Node.
Speaker #1: So we need to demonstrate, to build up, you know, a true process which is about 100 times larger than the pilot scale, as a precondition then for potential investment into a first commercial scale unit.
Speaker #1: And the big advantage here, through this partnership, is that we can accelerate the development. Shenzhen has a lot of knowledge in anode materials which we can benefit from and build on.
Speaker #1: And of course, we are saving a big capital expenditure by using the equipment and the processes that Shenzhen has ready-made.
Speaker #1: In order to now do the demonstration phase of league node. Now, having said that, I want to underline that building a significant business out of goods based on anode materials, our league node, you know, is a longer-term development.
Speaker #1: So it's it's longer out in the in the future. We need now to have successful demonstration scale operations and and develop further the the manufacturing process.
Speaker #1: But if we speak about anode materials today, we are speaking about a market which is tens of billions of euros in size. So it is a significant opportunity, but really long-term in the future.
Speaker #3: Yeah. And just Andrew, to add on that,
Speaker #1: Capex point to what Hans was saying again this is not this is not what we announced now is not any significant capex. And rest assured I mean capital allocation managing capex is is a key priority.
Speaker #1: Something we look into all the time, and you might have seen that we took down the guidance for the year when it comes to capex from €550 million to €500 million.
Speaker #1: And it won't stop this year. So, we keep a tight leash and make sure that we invest in stuff which gives good returns.
Speaker #1: And league node won't pop up on the radar anytime soon as any big CapEx.
Speaker #5: That's clear. And just to follow up, does Shenzhen have any real experience dealing with anode materials from wood-based byproducts? I mean, is this a first for them, or is it something that they've had experience with somewhere else in the world?
Speaker #1: No, this is the first experience they will gain through the collaboration with us.
Speaker #5: Okay. Thank you.
Speaker #2: Thank you. Our next question will come from Detlef Winklemann at JP Morgan. You may now unmute your audio, turn your video on, and ask your question.
Speaker #1: Hi team, good morning. Maybe my first one is just on Oulu. If I take a look over the last, let's say, four quarters, it looks like we've kind of landed in the negative EBIT range of minus 15 to minus 30 pretty much repeatedly, and it looks like we're going through the same in Q4.
Speaker #1: Should I be reading that as, you know, kind of the ramp-up benefits gained, operational leverages being offset by price-cost? And then we have to see how we go from here in terms of price-cost.
Speaker #1: And then my second question, if you don't mind, is just on this capex. Obviously, you've brought it down by about €50 million. Just curious if any of that €50 million is going to show up next year, or if this is permanently cancelled—i.e., just timing or a strategically made decision there.
Speaker #1: Thanks so much. So regarding Oulu, we are improving quarter on quarter in terms of financial performance, and we will continue to do so. We stick to our earlier guidance that we have the ramp-up completed during next year.
Speaker #1: Of course you know we are focusing on the on the sustainable you know product customer mix that also will ensure the long term profitability for the line.
Speaker #1: So, we are continuing to work on the commercial ramp-up with a focus on profitability. And if you take the CapEx question...
Speaker #5: On the on the capex no this is not the shift this is managing capex as a as a you know as part of capital allocation and you can imagine that within this 500 we have a long long long long kind of a stream of of of typically smaller items so it's just managing without within that bucket and therefore now taking down from 500 to to 550 because we haven't given any guidance on on on next year not talk too much about capex next year but we'll we'll continue to to keep a tight leash here.
Speaker #1: Okay. And then if I can squeeze in one more just in terms of it's a technical question just regarding regarding your your forest assets in Sweden normally tax rates for this kind of asset are we just thinking normal corporate tax rates or are there any relief benefits or refunds or anything like that we should be thinking about for having a forest asset?
Speaker #1: I'm not an expert in that at all.
Speaker #5: Yeah. Again let let's talk more next week in the in the CMD but to my understanding it's it's it's normal whatever that means but normal so it's not it's not the kind of rate structure like we have or what you might have in the US for instance.
Speaker #1: Okay. Thank you.
Speaker #2: Our next question comes from Cole Hawthorn at Jefferies. Please unmute your line to ask your question. Cole, your line is now open. Please go ahead.
Speaker #6: Good morning. Morning. Thanks for taking my question. I'd like to start with Forest. I mean, I understand we've got the CMD coming up on the 3rd, but some color would be helpful here, because, you know, you sold a billion of Forest a year ago, closer to book value. But a year ago is a long time in the current world.
Speaker #6: I'm just wondering as we go into the forest spin is there any plans or thoughts to dispose even a small amount be it a hundred hundred and fifty two hundred million close to closer to book value just to demonstrate a proof point to to the market that you can actually sell a decent size of forest closer to book and then the second one is following up on on the free cash flow for for the forest entity you've given some disclosure today you know roughly 90 million of free cash flow but I'm just wondering what you didn't give in the releases a a defined target of where this could ultimately go to.
Speaker #6: Could you give us a little bit of a preview for the Capital Markets Day—of, you know, some of the actions that might be taken to improve that free cash flow, to get towards the greater than 2% free cash flow yield?
Speaker #6: Thank you.
Speaker #1: Yeah. Good morning Cole. So first yes you're right. We sold 12.4% of our Swedish forest assets last year a very representative actually part of our of Bergslaget Skogar and yes we we sold it at exactly book value so enterprise value 900,000 900 million euros for for the 12.4% and but in in addition to this I mean we are all the time doing smaller you know like sell of forest land and some swaps and and and also some acquisitions to optimize and increase the value of our forest holding and we can see that you know in fact you know the the book value is is a very good indicator for the true value of the forest asset that we have.
Speaker #5: Yeah. And there may maybe on the on the cash flow and the kind of forward looking what's the potential again that's a key theme actually next week so I won't steal the the thunder from from next week but but of course it it it's kind of one of the core ideas with the whole transaction that we kind of unleash the potential of this company.
Speaker #5: So what you what you kind of got now and I'm I'm sure you haven't had too much time to look at it is kind of a first glimpse on the history and and but not necessarily a kind of a full download of what this can be in the future.
Speaker #5: And of course the the idea the whole idea is is to strengthen the the business and continue to develop it. But but again don't want to steal the thunder.
Speaker #5: So, let's be a bit patient and come back early next week.
Speaker #6: That's fair enough. I mean maybe just following up Hans on the first point is I mean you you sold the previous forest but is there any any view to sell a small little bit more?
Speaker #6: And the reason I ask that is you know it allows the the new spin forest entity to have a bit of cash for the forest that they sell and you know if the discount to book value where it starts trading gets to too large you know maybe they can deploy it within their own share buybacks to make sure that you know the share price kind of reflects what you think the the forest valuation is.
Speaker #6: Is there anything like that, or any kind of flexibility, for the new entity to have the cash to do buybacks should they need to? Or is that something we're still going to have to wait for until next week?
Speaker #1: We don't have any plans now to do any further major divestments of forest land within the Bergslaget Skogar perimeter before the demerger. We think that the big deal that we concluded last year is a very relevant, valid benchmark in a way for the true value of the forest land, and we are happy that we could confirm also the book value of this huge asset.
Speaker #1: And but then of course for the longer term Bergslaget Skogar has in their toolbox they have the possibility also to either divest forest land or buy forest land or swap forest land and there one way of value creation is of course you know to constantly improve the the the value of their forest holding and and of course they will have the same objective as we have to maximize shareholder value.
Speaker #6: Thank you. And then just on container board, on the underlying sort of business for integrated packaging, you know, with gas prices up at €100 TTF, I mean, we've almost crossed the Rubicon now where, you know, cost pressure might incentivize a further recycled container board price increase.
Speaker #6: Can you give us any comments of you know how you're thinking about pricing for you know your polar docks Sri Lanka mill and how higher prices well further price increases might benefit you for your virgin container board business in integrated packaging?
Speaker #6: Thank you.
Speaker #1: Yeah. Cole during this year we have executed several pricing cases in in container board especially in craft liner but also in in test liner.
Speaker #1: And and yes I mean we are 74% energy self-sufficient Stora Enso as an as an average and you know Cole is representing less than sorry oil is representing less than 1% of our energy and and natural gas less than 2% of our energy.
Speaker #1: So so we we have as a strong competitive situation in general compared to many Central European American and Asian competitors. Thanks to energy self-sufficiency and and a very small almost negligible you know impact of of oil and gas in our energy basket.
Speaker #1: The the main impacts from the from the conflict in in Iran and and the high energy costs comes through higher logistic costs and some higher chemical costs.
Speaker #6: Thank you. Our next question comes from Joni Sandvall at Nordea. You may now unmute your audio, turn your video on, and ask your question.
Speaker #2: Yeah. Thanks Hans and Nicholas. A couple of questions from my side. First of all still coming back on on Oulu. Could you give any any indication how the qualification processes have developed and any any surprises here and and additionally any indication of of the geographical you know sales split of of sales from Oulu currently?
Speaker #1: So thank you for the question. So I mean the the the the technical and and the quality performance of Oulu is has been good already for for a long time.
Speaker #1: And and we have we have been very active of course in the marketplace you know doing trial runs and tests we have also introduced new products to the market.
Speaker #1: We have expanded for instance the the product range the basis weight range and and and the feedback from customers has been really positive. So we have a very competitive good high quality assets here.
Speaker #1: And we can, through Oulu, also offer several yield advantages to our customers compared with the existing products in the market. So the products have been very well received by our customers.
Speaker #1: And we continue with our work to, you know, fill the line and ramp up the line.
Speaker #2: Okay. Okay. Thanks. And secondly still coming back on the on the Australaikka following the the clear increase in European gas prices. Could you give any indication are you are you still profitable in in Australaikka currently?
Speaker #1: Yes we are.
Speaker #2: Okay, thanks. That's all from me.
Speaker #6: Thank you. Our final question today comes from Martin Mellbo at ABG. Please unmute your audio, turn on your video, and ask your question.
Speaker #2: Yes, good morning. Two questions about 2027: What do you foresee, say, for liquid packaging board pricing and the upcoming negotiations? And how much of your portfolio is up for renegotiation?
Speaker #2: And the second question is on maintenance. So, this year lands at €380 million, if I'm not mistaken, which seems to be a pretty low number compared to the history.
Speaker #2: How will that number progress into 2027, please?
Speaker #1: Yeah. Thank you Martin for the question. We don't we don't guide and give any any forward looking statements here on the on the pricing.
Speaker #1: What I want to say is that you know we are the world's largest and leading liquid packaging board producer we have high quality assets in production assets in three countries we are serving the most the leading and the most demanding liquid packaging board customers and and we have really strong positions both in terms of customer relationships as well as also in terms of product quality and service as well as asset cost competitiveness.
Speaker #1: So so we will continue to be leaders in this field also in the future. And yeah I can I can I can comment on the maintenance.
Speaker #1: It's a favorite topic, hey Martin. Again, it goes into the same basket of capital allocation and managing it. Also, the maintenance is part of that.
Speaker #1: So so we have been the teams have been doing a lot of work on on how to run efficient maintenances and and also from a cost perspective how to to manage the cost tightly there.
Speaker #1: So I would say that it it no difference there whether it's kind of maintenance keeping the current assets in in in great shape or then you know putting in new new assets it's the same theme throughout and will continue to do that also also in the future.
Speaker #1: Maintenance just just to when as this is the last question just want to highlight that we have big maintenance kind of coming up or actually ongoing in Q4 with especially now in Q4 it's our consumer sites which are under maintenance.
Speaker #1: So, for instance, Imatra and Skoghall are both in maintenance in Q4, which of course will have an impact on the Q4 performance.
Speaker #6: Thank you. There are no further questions. I shall now hand back to CEO Hans Sohlström and CFO Nicholas Hordenlev for closing remarks.
Speaker #1: Thank you very much, all, for joining in and for your interest. I think it's clear: we do whatever it takes to maximize shareholder value. We continue our work systematically and diligently, with determination, to improve the performance and profitability of our business. But we are also working on the structures of our company, and here the Bergslaget Skogar separation is a great example.
Speaker #1: We we are certain that this is unlocking a value this is creating shareholder value and this is creating two leading companies in their field Europe's leading pure stock listed forest company as well as also the renewable materials company with a strong focus and growth opportunities in packaging.
