Monday, August 18, 2025
Koskisen Group reported a year-on-year increase in EBITDA for the second quarter, with adjusted EBITDA reaching EUR 10.3 million, up from EUR 9.3 million. The adjusted EBITDA margin was 11.5%, slightly down from 12.0% in the same period last year. Despite a challenging operating environment, the company’s profitable and sustainable growth trajectory continues, driven by strong revenue growth compared to both the preceding quarter and the corresponding period last year.
The operating environment remains uncertain, largely due to erratic trade and customs policies from the United States. These policies have created instability, particularly in consumer-driven demand, which remains weak despite lower interest rates. Fortunately, Koskisen has limited trade relations with the US market, so the direct impacts of these policies on the company have been minor. However, the recovery of the construction sector has yet to materialise, and the effects of demand-stimulating decisions in Europe have remained limited.
Sawn Timber Industry Segment Sees Substantial Profit Improvement
Koskisen’s Sawn Timber Industry segment showed impressive performance in Q2, with EBITDA rising significantly to EUR 4.2 million, up from EUR 1.6 million last year. Shift-specific production at the Järvelä facility developed as expected, with other operational indicators also moving in the right direction. Even in the face of subdued summer-related demand, the segment maintained strong profitability, with revenue growing substantially. Despite this, demand remained lower than anticipated.
The outlook for the upcoming autumn remains uncertain across multiple markets, with various factors impacting demand. However, Koskisen remains confident in the Sawn Timber Industry segment’s ability to maintain its strong profit performance, given its robust operational foundation.
Strategic Acquisition and Integration of Iisveden Metsä Business
In June, Koskisen completed the acquisition of Iisveden Metsä’s business operations. This acquisition will allow Koskisen to deliver even greater value to customers, with enhanced market-specific product offerings. The integration of financial systems has already been completed, and the integration of production control and wood procurement systems is expected to be finished in the second half of the year. This acquisition further strengthens Koskisen’s position in the Panel Industry and expands the company’s wood procurement area, ensuring a steady supply of raw materials.
Although the acquisition did not significantly impact revenue or profitability in the quarter under review, it positions Koskisen for organic growth, particularly in the Panel Industry.
Sawmill Expansion and Energy Efficiency Initiatives
Koskisen continues to increase the production volume of its new sawmill, aiming for a target of 450,000 m³. Additionally, construction work has commenced on a district heating connection pipe between the production plants in Järvelä. This project will optimise the operating rate of the adjacent power plant, which is currently underutilised. By enabling the continuous production of electricity, this connection will also improve the efficiency of heat production and reduce the need for new heat investments related to sawmill production.
This initiative will help Koskisen avoid additional investment in heat production capacity, addressing a potential bottleneck in drying capacity that could otherwise limit production.
Wood Procurement and Market Trends
Koskisen’s wood procurement operations proceeded according to plan, with wood reserves remaining at a healthy level. Although the price of raw wood material remained high, the peak appears to have passed, with prices starting to decrease slightly toward the end of the quarter. In the energy wood market, the mild winter led to lower demand for energy wood, impacting the revenue and profitability of the Sawn Timber Industry segment. This trend is expected to result in slightly lower prices during the upcoming contract period.
Panel Industry Segment Faces Profitability Challenges
The Panel Industry segment saw a decline in profitability, with EBITDA dropping to EUR 6.7 million from EUR 8.1 million last year. The increase in wood raw material costs and general production costs negatively impacted profitability. Despite these challenges, the segment’s EBITDA margin remained solid at nearly 16%. The demand for plywood showed moderate improvement towards the end of the quarter, while chipboard demand remained subdued due to low new construction and renovation activity.
Koskisen continues to make significant investments in the Panel Industry. The first stage of the investment programme, aimed at improving productivity, quality, and yield, is progressing as planned. The summer shutdown in July saw the first equipment installations, and the remaining installations will take place between September and December.
Commitment to Sustainability and Climate Action
Koskisen remains committed to reducing the climate and environmental impacts of its products. In May, the company launched Zero ThinPly, a new thin plywood product made entirely from bio-based materials. Additionally, Koskisen piloted the use of decommissioned wood packaging material, such as pallets, as a raw material for chipboard. This pilot project has been successful, allowing previously discarded wood to be recycled into high-quality chipboard products.
By embracing circular bioeconomy principles, Koskisen is maximising the use of wood raw material, contributing to sustainable production and the reduction of carbon emissions.
Conclusion and Outlook
Koskisen’s second-quarter performance demonstrates its ability to maintain profitable growth despite a volatile market environment. With strategic acquisitions, continued investment in production, and a strong focus on sustainability, the company is well-positioned to navigate the challenges ahead. While uncertainties remain in the construction sector and global markets, Koskisen’s diversified operations and commitment to innovation will continue to drive its long-term success.
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Tags: circular bioeconomy, Koskisen, Sawn Timber Industry, second-quarter EBITDA, woodworking industry, woodworking UK
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