Metsä Group plunged deep into the red during the third quarter. The Finnish forest industry giant reported an operating loss of 69 million euros. Its pre-tax loss reached 84 million euros.
Comparable figures show an even steeper decline. The comparable operating loss stood at 72 million euros, while the comparable pre-tax loss hit 87 million euros.
These results mark a dramatic reversal from last year's performance. In the same July-September period last year, Metsä Group posted a 113 million euro operating profit and 102 million euro pre-tax profit.
Metsä Board, the listed packaging company within Metsä Group, contributed significantly to the losses. The subsidiary reported a 45.6 million euro comparable operating loss despite generating 441 million euros in revenue. Its loss per share reached 11 cents.
In a surprising move, Metsä Board announced it will stop providing quarterly earnings guidance. Company officials said continuing guidance doesn't make sense in the current volatile market conditions.
The forest industry faces challenging times as global demand weakens and production costs remain high. These third quarter results show even industry leaders struggle to maintain profitability in today's economic climate.
What does ending quarterly guidance mean for investors? Companies typically provide guidance to help markets predict future performance. Metsä Board's decision suggests management sees too much uncertainty to make reliable forecasts.
Finnish forest industry companies face pressure from multiple directions. Energy costs, environmental regulations, and shifting global demand create a perfect storm for traditional paper and pulp producers.