Södra, a Swedish forest-owner cooperative with industrial operations in pulp, wood products and building systems, reports weaker 2025 results as demand softened, currency moves were unfavorable and raw material prices rose, and the company has carried out a broad action program during the year to reduce costs and protect competitiveness.

Net sales fall 4% year-on-year to 28.30 billion kronor in 2025, and the operating result swings to an operating loss of 1.29 billion kronor from an operating profit of 2.63 billion kronor the previous year. Return on capital employed is -5% versus 10% a year earlier, and the equity ratio is 56% at year-end versus 62% at the end of the previous year.

The company says its operating performance worsens by 3.4 billion kronor year-on-year, and estimates that a combined effect from higher raw material prices, currency moves and lower demand reduces earnings by about 4.0 billion kronor. It attributes about 2.2 billion kronor of that impact to higher raw material prices and about 1.8 billion kronor to currency effects. The contribution margin falls to 24% from 33% at the start of 2025.

Södra reduces overhead costs by 380 million kronor in 2025 and reports record pulp production of 1.9 million tonnes, while higher lumber recovery in Södra Wood improves output efficiency. The company also reports 518 million kronor in gains from its continuous improvement program, while noting that the action program's effects have not yet fully flowed through to reported results.

By business area, Södra Skog reports an operating loss of 14 million kronor in 2025 versus an operating profit of 513 million kronor a year earlier, with results affected by slightly lower volumes mainly from energy products. It says demand for sawlogs and pulpwood is high and stable through most of 2025, but weakens toward year-end except for spruce sawlogs.

Södra Wood reports an operating loss of 463 million kronor versus an operating profit of 23 million kronor the previous year, citing higher delivery prices, lower volume and sharply higher sawlog costs. Södra Cell reports an operating loss of 258 million kronor versus an operating profit of 2.87 billion kronor a year earlier, driven mainly by unfavorable currency rates and higher raw material costs, partly offset by higher volume. Södra Building Systems reports an operating loss of 168 million kronor versus an operating loss of 157 million kronor in the prior year, citing higher raw material costs partly offset by higher invoiced volumes.

The board proposes profit distribution to members of 616 million kronor, including 560 million kronor linked to timber deliveries and a member equity issue of 56 million kronor. The annual meeting in Jönköping on June 2 will decide on the proposal.

Södra says it continues to invest in future earnings capacity through the Kinda sawmill decision and the start of construction of a lignin plant in Mönsterås, and it has decided to sell its forest holdings in the Baltic states to sharpen focus on members' forests and strengthen the balance sheet. It reports Södra Bioproducts revenue of 3.55 billion kronor in 2025, down from 3.82 billion kronor the previous year, and says that revenue is included within other business areas.