UPM‘s weak financial performance has continued for the fourth consecutive year, with the group recording reduced operating profits of €278m in 2005.
The result was down from €627m a year ago, but was severely impacted by non-recurring items. UPM’s sales were up marginally to €9.3bn.
One-off costs also hit fourth quarter results, with an operating loss of €71m recorded compared to €194m profits a year earlier.
The company said operating profits, excluding non-recurring items, had improved but remained weak due to various factors, including last summer’s labour dispute in Finland’s paper industry and overcapacity in printing papers.
Demand for plywood and sawn timber is expected to remain good but markets for the latter product will continue to be oversupplied.
President and chief executive officer Jussi Pesonen said: “To achieve a turnaround, UPM must take new kinds of actions. These actions will allow us to use our capacity more profitably than before. We are currently studying a number of options to achieve a lasting improvement in profitability.”
