The Helsinki-headquartered biomaterials group said that in H2 market demand for its products had been weaker than expected.

In addition, the weakened pulp market and the high cost of wood in Finland had a negative impact on the UPM Fibres operation.

Earlier this month UPM announced a cost-cutting plan for Fibres that included redundancies and potential temporary lay-offs, having previously announced pauses in production at two pulp mills.  

UPM said that a bright spot was its new Paso de los Toros pulp mill in Uruguay, which has operated at full production since undergoing its first maintenance shutdown in June.

UPM also released preliminary results for Q3. Although EBIT was up 32% year-on-year to €291m (£243.5m), and by 17% for the first nine months of the year, this was less than had been expected.

Group sales in Q3 slipped by 2% to €2.52bn.

UPM Communication Papers had been UPM's biggest division last year but is currently second to Fibres for the Q1-Q3 period in 2024.

In Q3 sales at Communication Papers were down nearly 7% at €751m, while EBIT at the division almost halved at €51m (Q3 2023: €96m).

Regarding the full-year outlook, UPM said comparable EBIT was likely to be “on a similar level or increase” from 2023, whereas previously the group had been confident that it would increase.

UPM’s share price slipped by 3.2% on the news to €28.04 (52-week high: €35.77, low: €27.46).