Finland-based forestry giant UPM (United Paper Mills) on Thursday reported a 20 percent decline in turnover and a 41 percent decline in profits in Q2 2020, year-on-year.
UPM’s profit reached 203 million euros (235 million U.S. dollars) in Q2, compared with 345 million euros in the corresponding period last year. The turnover of Q2 2020 was 2,077 million euros, down from 2,605 million euros in Q2 2019.
In its report, UPM said besides diminished deliveries of graphic paper, the decline was caused by lower price levels of both paper and pulp.
Jussi Pesonen, president and CEO of UPM, noted in the press release on Thursday that demand for graphic paper declined in Europe by 32 percent during Q2 2020, due to anti-COVID-19 measures. “UPM Communication Papers reported a loss for the first time in five years,” said Pesonen. UPM Communication Papers is the world’s leading producer of graphic papers.
UPM made savings in costs, but could not offset the bad market development, said Pesonen, adding that demand for special papers had increased.
This summer UPM closed the Saynatsalo plywood plant in Jyvaskyla, central Finland and the Chapelle paper plant in France. The plywood plant in Jyvaskyla had been in production since 1914.
Meanwhile, during the first half of 2020, UPM turnover declined by 18 percent to 4,364 million euros from 5,298 in the same period of 2019, while profit dropped by 33 percent, from 719 million euros to 482 million euros. (1 euro = 1.16 U.S. dollars)