Stora Enso reports 9.1% sales increase in Q1 FY25

Stora Enso, a Finnish packaging company, has reported sales of €2.36bn ($2.68bn) in the first quarter (Q1) of fiscal year 2025 (FY25), a 9.1% increase from the same period of the previous fiscal year.

In the interim report for the period of January to March 2025, the company attributed this increase primarily to elevated prices and deliveries.

The company's adjusted earnings before interest and taxes (EBIT) rose for the fourth consecutive quarter on a year-on-year basis to €175m in Q1 FY25, which is a 17.7% uptick from the €149m posted in the corresponding quarter of the previous year.

The adjusted EBIT margin also saw an improvement, climbing to 7.4% in Q1 FY25 compared to 6.9% in Q1 FY24. Higher prices, volumes, and positive impacts from net currency exchange rates and depreciations more than offset higher fibre costs, stated the company.

During Q1 FY25, Stora Enso's operating result witnessed an increase of 21.7%, reaching €171m compared to €141m reported in Q1 FY24.

The company's pretax result indicates a 40.8% rise to €132m in Q1 FY25 from the €94m in Q1 FY24.

The net result for the period grew 40% year-over-year to €107m.

The company's basic earnings per share for Q1 FY25 stood at €0.14, up 43.5% from €0.10 reported in the same period of the previous year.

Stora Enso president and CEO Hans Sohlström said: “This improvement primarily resulted from higher prices, alongside increased volumes, favourable foreign exchange rates, and the positive impact of cost-saving and value-creation initiatives, which helped mitigate continued high fibre costs.”

Looking ahead, Stora Enso expects its adjusted EBIT for the entirety of FY25 to be adversely affected by around €100m due to the ramping up of its new packaging board line in Oulu, Finland, with a significant portion of this impact anticipated in Q2.

For FY25, the group has projected its capital expenditures to be between €730m and €790m.

In Q2 FY25, it also anticipates maintenance costs to surpass the first quarter by roughly €20m.

Within its Packaging Materials division, Stora Enso predicts a stable containerboard market with ongoing price increments from Q1 to Q2.

The demand for consumer board is expected to be seasonally stronger, and output from the company's new consumer packaging board line is set to gradually boost delivery volumes.

The Packaging Solutions division, meanwhile, is anticipating heightened demand in Western Europe, driven by the seasonal fruit and vegetable market.

Last week, Stora Enso announced plans to reorganise its structure into seven profit and loss accountable business areas, emphasising the significance of its renewable packaging operations.