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Investing.com -- UPM-Kymmene Corporation stock falls 1% after the Finnish paper and forest products company reported second-quarter earnings that significantly missed analyst expectations, impacted by trade tensions and weaker market conditions.
The company posted second-quarter EBIT of €126 million, down from €287 million in the first quarter and 32% below the consensus estimate of €185 million. The miss was primarily driven by underperformance in communication paper, which reported EBIT of only €5 million versus expectations of €41 million, and pulp operations, which delivered €56 million against forecasts of €73 million.
First-half EBIT reached €413 million, landing at the lower end of the company’s guidance range of €400-625 million and below the €515 million reported in the same period last year. For the second half of 2025, UPM maintained a similar outlook with EBIT guidance of €425-650 million.
The company indicated that U.S. tariffs and trade tensions negatively impacted pulp and graphic paper deliveries and prices during the quarter. Looking ahead, UPM expects some benefit from lower variable costs and fourth-quarter energy refunds, but performance will be constrained by extended downtime at its Kaukas pulp mill in the third quarter, lower paper deliveries, and a weaker U.S. dollar.
"Overall, we see print as disappointing and UPM lower today on 2Q miss, challenging outlook & 2025 cuts," Jefferies analysts commented.
The midpoint of UPM’s second-half guidance implies a full-year 2025 EBIT of €951 million, representing approximately a 9% reduction from the previous consensus estimate of €1.05 billion.
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