Overview

• Mercer Q3 revenue declines 9% yr/yr, missing analyst expectations

• Operating EBITDA turns negative, impacted by lower pulp sales and higher fiber costs

• Company advances cost-saving initiatives to improve liquidity and efficiency

Outlook

• Mercer expects weak pulp prices to persist in Q4 2025

• Company anticipates modest lumber price increase in Europe in Q4 2025

• Mercer plans further cost reductions and lower capital expenditures for 2026

Result Drivers

• GLOBAL ECONOMIC CHALLENGES - Persistent global economic and trade uncertainties, fiber scarcity, and pulp substitution negatively impacted demand and pricing, contributing to a $20.4 mln inventory impairment

• COST-SAVING INITIATIVES - Co continues One Goal One Hundred program targeting $100 mln in cost savings by end of 2026, with $30 mln expected by end of 2025

• CARBON CAPTURE PROJECT - Advancing carbon capture project at Peace River mill, in partnership with Svante Technologies, with pilot expected to operate in Q4 2025

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the paper products peer group is "buy."

• Wall Street's median 12-month price target for Mercer International Inc is $3.00, about 36% above its November 5 closing price of $1.92

Press Release: ID:nGNX54sHVS

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)