METSB: Cost Savings And Efficiency Programme Will Support Margins Amid Demand Weakness

Analysts have slightly reduced their price target for Metsä Board Oyj from €3.02 to €3.00. They cite modest adjustments to expected profit margins and discount rates in their updated financial models.

What's in the News

• Metsä Board has launched a cost savings and profitability improvement programme worth around EUR 200 million. The initiative aims to adjust the company's cost structure and enhance efficiency. Recent change negotiations in Finland resulted in a reduction of 150 positions, and further negotiations are continuing in other countries. (Company Statement)
• As a result of concluded negotiations, Metsä Board may implement temporary layoffs at production sites in Finland during 2026. These layoffs could potentially last up to or beyond 90 days depending on the location, to align production with low paperboard demand. (Company Statement)
• Anssi Tammilehto has been appointed Chief Financial Officer and will join the Corporate Leadership Team no later than February 2026. Antti Kiljunen currently serves as interim CFO. (Company Statement)
• The company has completed a EUR 60 million modernisation project at its Simpele mill. This project has increased fossil-free energy use from 89% to 98% and has enhanced product quality and sustainability. (Company Statement)
• The upgraded MetsäBoard Classic FBB folding boxboard is now available. This product features improved print quality and visual uniformity following the renewal of the Simpele mill. (Company Statement)

Valuation Changes

• The consensus analyst price target has decreased slightly from €3.02 to €3.00.
• The discount rate has risen moderately from 6.05% to 6.20%.
• The revenue growth projection has increased marginally from 5.09% to 5.11%.
• The net profit margin estimate has fallen from 7.69% to 7.51%.
• The future P/E ratio has risen slightly from 6.78x to 6.92x.