SCA\u2019s sawmill business recorded the sharpest earnings deterioration across the group in the second quarter of 2026, as higher log costs, lower softwood lumber deliveries and adverse currency movements overwhelmed the improvement in selling prices seen during the spring.<\/p>\n
The Swedish forest products group published its second-quarter and half-year results on July 22. While its Forest segment continued to provide relatively stable cash generation, the Wood division \u2014 comprising SCA\u2019s sawmills, wood processing operations and building-material distribution activities \u2014 saw profitability fall to its lowest level in several years.<\/p>\n
Wood segment EBITDA falls 71% in the second quarter<\/strong><\/p>\n Wood segment EBITDA dropped by 71% year-on-year in Q2, from SEK 310 million to SEK 89 million (\u20ac29 million to \u20ac8 million). Operating profit fell even more sharply, declining by 93% to SEK 17 million (\u20ac2 million).<\/p>\n For the first six months of 2026, Wood EBITDA reached only SEK 138 million (\u20ac13 million), compared with SEK 546 million (\u20ac50 million) during the same period last year. The EBITDA margin consequently contracted from 16.9% to 4.9%, the largest relative deterioration of any SCA division.<\/p>\n SCA\u2019s Wood segment includes five sawmills in northern Sweden, located close to the company\u2019s forest holdings, together with further-processing and distribution operations serving building-material markets in Scandinavia and France. The division has annual production capacity of approximately 2.2 million m\u00b3.<\/p>\n Management attributed the deterioration primarily to higher wood raw-material costs, lower delivery volumes and unfavorable currency effects. Although softwood lumber prices increased from the first quarter, supported by costly sawlogs and the seasonal improvement in construction demand, the increase was insufficient to compensate for the much stronger comparison period in 2025.<\/p>\n SCA delivered 500,000 m\u00b3 of wood products during the second quarter, down 12% year-on-year. Volumes nevertheless rose by 11% from the first quarter, consistent with the normal spring and early-summer increase in construction activity.<\/p>\n Spruce remains stronger than pine<\/strong><\/p>\n Softwood lumber production in Sweden and Finland decreased during the first five months of 2026 compared with the same period last year.<\/p>\n SCA described European demand as seasonally normal, with spruce lumber continuing to perform better than pine. Producer inventories remained high for pine but were closer to normal levels for spruce.<\/p>\n Stocks were nevertheless generally below the levels recorded a year earlier, while inventories held by customers were estimated to be low.<\/p>\n The inventory split between pine and spruce remains important for Nordic producers. High pine stocks continue to weigh on that part of the market, while the more balanced spruce position provides better support for prices and mill utilisation.<\/p>\n Forest revenue holds steady, but underlying earnings decline<\/strong><\/p>\n The performance of SCA\u2019s Forest segment contrasted with the severe pressure on its sawmills.<\/p>\n Half-year net sales in Forest were broadly unchanged, as lower delivery volumes to SCA\u2019s own sawmills were offset by higher sawlog prices. Beneath the stable revenue figure, however, the underlying operating result weakened.<\/p>\n EBITDA excluding the revaluation of biological assets \u2014 the figure that more closely represents actual harvesting and timber sales \u2014 declined by 14% during the first six months. The reduction was caused mainly by higher fuel expenses and lower harvesting volumes from SCA\u2019s own forest holdings.<\/p>\n SCA continued processing wind-felled timber from storm damage recorded during the previous year. This helped maintain the flow of raw material to the group\u2019s industrial facilities and supported the company\u2019s assessment that the market balance between sawlogs and pulpwood remained broadly stable.<\/p>\n Middle East conflict pushes fuel costs higher<\/strong><\/p>\n The conflict in the Middle East contributed to a temporary rise in fuel prices during the quarter, increasing costs across SCA\u2019s Forest and industrial operations.<\/p>\n For the Wood segment, this added another layer of pressure to an already difficult cost environment marked by expensive sawlogs, weaker deliveries and unfavorable exchange-rate movements.<\/p>\n The impact was not uniform across the group. Higher fuel prices weighed on the sawmills and other manufacturing activities, but supported the Renewable Energy segment, which reported record earnings during the quarter.<\/p>\n By the end of June, fuel prices had returned to levels comparable with those prevailing before the escalation of the conflict. The cost shock was therefore concentrated mainly within the quarter rather than representing a permanent shift in SCA\u2019s energy-cost base.<\/p>\n SCA said its high degree of self-sufficiency in timber, fuel, electricity and logistics continued to limit the impact of external price increases.<\/p>\n This remains a significant structural advantage, particularly compared with independent sawmills that must purchase most of their logs, energy and transport services on the open market. Even so, the scale of the margin contraction in Wood shows that internal raw-material and energy supply could not fully insulate the company from the combination of higher sawlog values, fuel costs and adverse currency movements.<\/p>\n Group EBITDA drops by more than one-third<\/strong><\/p>\n At group level, SCA reported second-quarter net sales of SEK 5.153 billion, or approximately \u20ac475 million. Sales were 4% lower than a year earlier but increased by 9% from the first quarter.<\/p>\n Group EBITDA declined by 36% year-on-year to SEK 1.303 billion (\u20ac120 million), while the EBITDA margin dropped to 25.3% from 37.8%.<\/p>\n SCA attributed the reduction to lower selling prices, adverse currency movements and higher raw-material costs. These effects were only partly offset by the group\u2019s high level of self-sufficiency.<\/p>\n Compared with the first quarter, EBITDA increased by 18%, supported by improved selling prices, lower raw-material costs and higher delivery volumes.<\/p>\n Operating profit fell to SEK 724 million (\u20ac67 million), close to half the level reported in the second quarter of 2025.<\/p>","protected":false},"excerpt":{"rendered":" SCA\u2019s sawmill business recorded the sharpest earnings deterioration across the group in the second quarter of 2026, as higher log costs, lower softwood lumber deliveries and adverse currency movements overwhelmed the improvement in selling prices seen during the spring. The … Continue reading \n\n
\n \nWood segment \u2014 SEKm (\u20acm)<\/th>\n Q2 2026<\/th>\n Q2 2025<\/th>\n Change<\/th>\n Q1 2026<\/th>\n Q\/Q<\/th>\n H1 2026<\/th>\n H1 2025<\/th>\n Change<\/th>\n<\/tr>\n<\/thead>\n \n Net sales<\/strong><\/td>\n 1,524 (140)<\/td>\n 1,733 (160)<\/td>\n -12%<\/td>\n 1,303 (120)<\/td>\n +17%<\/td>\n 2,827 (260)<\/td>\n 3,231 (298)<\/td>\n -13%<\/td>\n<\/tr>\n \n EBITDA<\/strong><\/td>\n 89 (8)<\/td>\n 310 (29)<\/td>\n -71%<\/strong><\/td>\n 49 (5)<\/td>\n +82%<\/td>\n 138 (13)<\/td>\n 546 (50)<\/td>\n -75%<\/strong><\/td>\n<\/tr>\n \n EBITDA margin<\/strong><\/td>\n 5.8%<\/td>\n 17.9%<\/td>\n \u2013<\/td>\n 3.8%<\/td>\n \u2013<\/td>\n 4.9%<\/td>\n 16.9%<\/td>\n \u2013<\/td>\n<\/tr>\n \n Operating profit<\/strong><\/td>\n 17 (2)<\/td>\n 237 (22)<\/td>\n -93%<\/strong><\/td>\n -23 (-2)<\/td>\n \u2013<\/td>\n -6 (-1)<\/td>\n 402 (37)<\/td>\n \u2013<\/td>\n<\/tr>\n \n Wood product deliveries, thousand m\u00b3<\/strong><\/td>\n 500<\/td>\n 568<\/td>\n -12%<\/td>\n 451<\/td>\n +11%<\/td>\n 951<\/td>\n 1,092<\/td>\n -13%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n