Metsä Board Decides Against Investing in the Kaskinen Folding Boxboard Mill

In September 2022, Metsä Board announced the start of pre-engineering for a new folding boxboard mill in Kaskinen, Finland. This included technical design, design of infrastructure and logistics solutions, tendering for the main equipment as well as financial analysis of the project. The pre-engineering also included an environmental impact assessment and an application for an environmental permit.

Now that pre-engineering has been completed, Metsä Board has decided not to proceed with the investment in the Kaskinen folding boxboard mill. The total cost of the planned investment was significantly higher than originally estimated, meaning that the targets for payback time and return on capital employed would not have been met. Metsä Board will write down the costs of the pre-engineering, in total approximately EUR 8 million, treated as an investment, as an item affecting comparability in the January-March 2024 operating result.

Metsä Board plans investments in its existing mills

Metsä Board has decided to launch programs for new product options as well as growth and development investments at its existing mills to implement its strategy to grow in fiber-based packaging materials and renew its industrial operations. The programs will support Metsä Board's target of fossil-free production by the end of 2030. In addition, the company will continue to develop packaging solutions that reduce the use of plastics.

At the Husum integrated mill in Sweden, Metsä Board will start a program to introduce new products on the current white kraftliner production line (BM2). The aim is to find new innovative solutions for the growing food and food service packaging segment. The company continues to plan the renewal of the fiber line at the Husum pulp mill.

Metsä Board will also launch a major investment program to modernize the Simpele board mill, which will be implemented in phases. The investments include renewals in the mechanical pulp production, in the pre-drying and coating section of the paperboard machine as well as in the finishing area. The program also includes a new power plant. As a result, the quality, performance, and cost competitiveness of the folding boxboard will improve, and the production capacity will increase.

At the Kyro board mill, an investment program will be launched to improve the performance of the current barrier board and expand its end-use areas. The total estimated investment cost of the Simpele and Kyro paperboard mills is EUR 250 million over the next 10 years.

To learn more about Metsä Board, please visit https://www.metsagroup.com/metsaboard/