Södra reports an operating loss of $37 million in the second quarter of 2025, down from a $38 million profit in the same period last year. Net sales declined by 4% to SEK 7.19 billion from SEK 7.53 billion, with currency effects reducing results by over SEK 580 million. The operating margin dropped to -5%, while return on capital employed remained at 7% and the equity ratio stood at 57%, according to Södra.
The result was primarily impacted by sharp currency movements, ongoing high raw material prices, and SEK 240 million in costs from two planned maintenance shutdowns. These external pressures led Södra to launch an action program targeting cost control, production, and competitiveness. The pulp business, Södra Cell, reported an operating loss of SEK 221 million, compared with a SEK 380 million profit a year earlier, mainly due to currency losses and downtime.
The Södra Woods division saw a steep profit decline to SEK 3 million from SEK 128 million, as high timber costs outweighed delivery price increases. Södra Skog posted SEK 7 million in profit, down from SEK 46 million, mainly due to lower volumes and increased digital investments. The Building Systems unit recorded a loss of SEK 44 million, driven by weak construction demand.
Södra noted weaker demand in pulp linked to shifting consumer habits and a strong Swedish krona. However, the CLT segment reported growing sales and production, supported by rising wood use in construction. Bioproduct sales declined to SEK 704 million from SEK 800 million, affected by lower demand for solid fuels and heat, though biomethanol remained stable in both production and demand.
Efficiency initiatives yielded SEK 115 million in recurring annual savings during the quarter and SEK 1.67 billion since 2021. Strategic investments included the start of construction on a lignin factory in Mönsterås and expanded digital tools for forest owners. The lignin plant is scheduled for completion in 2027 and is expected to be the world’s largest sulphate lignin facility.
