Arctic Paper: Strong paper - ABG
Detta är en aktieanalys producerad av tredje part och reflekterar därför nödvändigtvis ej våra åsikter och värderingar
* Beat driven by strong paper performance* Challenging markets* Outlook remains mutedBeat driven by strong paper performanceQ3 group EBITDA came in at PLN 39m, which was above ABGSCe PLN 15m. Paper EBITDA came in at PLN 39m, which was above our PLN 25m. Paper EBIT was PLN 16m vs. ABGSCe PLN 5m. Group EBIT came in at PLN 4.5m vs. ABGSCe of PLN -19m. EPS came in at PLN 0.03 vs our estimate of PLN -0.16.Challenging marketsPulpwood prices are dropping 10-15% across Scandinavia (Baltics -30%) as high inventories and low demand pressure the market. This is the first decline after a 100% rise over the last three years. The pulp market has its short-term issues, but hardwood prices are below the marginal producers' cash cost (unsustainable), and Suzano has announced +12% hikes. Paper markets are helped by 17% supply cuts in '24-'25, but slow demand leaves utilisation at only 75-80% in '25e. We need 3.5mt in more cuts (16%) to reach the historical average of ~89%.Outlook remains mutedArctic Paper expects the difficult market conditions to continue through Q4'25, and highlights focus on cost control and financial resilience. We will await the company call before concluding on the coming quarter and the '26e estimates, but estimates are likely to be lifted by the beat today.