Billerud Ab (Sweden)

Good morning and very welcome to this presentation in connection to the Q2 report that we have published this morning. With me is our president and CEO, Ivar Vattne, along with our CFO, André Kress. They will hold the presentation and afterwards take questions from the telephone conference. So with that, we will get started. Please go ahead, Ivar.

Thank you Lena and good morning everyone and thanks for listening in this sunny Friday at least here in Stockholm. It's a tale of two stories for a quarterly report and I think it summarized quite well in the heading here on the slide. Another excellent quarter for region North America while we are navigating through more challenging conditions for region Europe. But let's get into the details. So next slide, please. And if we start from the top, we record flat net sales growth when adjusting for currency. Growth in North America and decline in Europe. Our region, North America, continues to impress and record yet another excellent quarter. And 22% EBITDA margin is a level we are clearly happy with. In fact, 22% is the highest profitability level we've had in North America since end of 2022. The situation for region Europe has been more challenging and market conditions have gradually turned more and more unfavorable during the quarter. And in essence, we are navigating in a market where we face weak demand and supply over capacity. Now, despite this, and with our continuous strong focus on working capital discipline, we have been able to produce an excellent cash generation, coming in with cash growth from our productivity of 75% versus a year ago. The progress on our evolution journey in the US continues, and we take new important steps during the quarter. And I want to share some more details on that part. So let's get into the next slide, please. Now, evolving our product portfolio in North America towards packaging material is one of the top priorities for the company. And I'm both proud and excited to see the progress we're doing. We reached another important milestone during the quarter with 1,000 tons sold of our Bleach Liner Tribute and Low Ramage Carton Board Voyager. And overall, we see strong interest amongst both the new and existing customers to carry out trials for the new products. And overall, the feedback on the product quality and performance has been highly encouraging. It confirms again that local US production within our industry is a good place to be where we can offer quality, speed, reliability, and predictability. Also in terms of the capital project to enable even further acceleration in our evolution journey, we are progressing as per plan. And I'm looking forward to providing you with more updates on this exciting journey. as we move along in 2025. Next slide, please. And over to some market comments. And it is challenging to give a proper market read these days. And uncertainty, in particular in the wake of geopolitical decisions, seems to be the new normal and can change industry parameters literally overnight. But there is no doubt that some of the ongoing optimism for demand recovery in region Europe for 2025 is a memory far away. The trading conditions for most of our categories in Europe weakened during the quarter, and there are three main reasons for that. So number one, consumer demand is still muted and is yet to recover. The growth rates we are expecting long term for this industry and most of the categories we have exposure to. Number two, we are seeing the impact of more production capacity coming online in the region, first and foremost within board. And three, the tariff impact is real. And we see now evidence of how the trade flows have started to change. Not only with volume historically being exported into US, but now due to import tariffs, have lost on competitiveness and is partly relocated back into Europe. We also see some Asian volume struggling to find its way into US and puts more pressure into markets in the Middle East. And overall, we do not expect the situation to improve going into Q3. Now, the notable exceptions where we operate under more normalized conditions are liquid packaging border here in Europe and our graphic and speciality paper in North America. For both these cases, we are expecting them to continue their solid performance they've continuously seen over the past quarters. So with that, I'd like to hand it over to André.

Thank you, Ivar, and good morning, everyone. Let's start by looking at our sales, which declined by 5%, and that was entirely driven by the FX headwind, meaning our currency neutral sales were flat versus a year ago. Now, the strengthening of Swedish krona we've experienced first and foremost by the end of the first quarter is now fully impacting both our sales and also results. The positive pricing of 2% is mainly coming from our Europe region, while North America was quite flat versus a year ago. Volume-wise, the negative impact is entirely from region Europe, while North American region had a solid volume growth of 8%. Next slide, please. EBTA margin in the second quarter was in line with the last year at 9%, and also here, a tale of two stories. North America improving margin with four percentage points, while Europe seeing corresponding decline. And despite significant change in FX rates versus last year, the impact on our results was relatively limited due to our hedging program in place. The year-over-year cost inflation, mainly from Nordic pulpwood costs, was more than compensated with improved pricing. However, the volume growth in North America was also offset with decline in Europe. and volume was weighing negatively year over year. Despite significant inflationary pressure on our fixed costs, not least through the salary increases, we are maintaining strong cost discipline and we were able to limit the cost inflation year over year. The negative amount in other is almost entirely related to negative year over year effect from inventory revaluation. We had no major impact now in quarter two, but we had sizable positive impact last year. Now, our quarter two was maintenance heavy with three mills in Europe having a maintenance shutdown, and those were executed as planned and also on budget. Excluding the heavy maintenance costs, our performance for the group in terms of EBTA margin was in line with quarter one despite lower volumes. And now let's move over to the regions. Next slide, please. Performance in region Europe weakened during the quarter, and we did end up with sequentially lower sales volumes for the region across most categories. The earlier announced price increases for container board and second craft paper were partly implemented, with clearly better implementation rate within second craft, while container board has been more challenging. Into the third quarter, we will have somewhat lighter maintenance schedule with cost impact of around 280 million. And now let's move over to region North America. Next slide, please. The reported sales for the region declined by 5%, but clearly heavily impacted by weakening of US dollar. Currency neutral sales were actually up by 5%. The EBITDA margin, as I said, improved with four percentage points versus a year ago and was also up percentage points sequentially versus the first quarter. And it's now been a sixth consecutive quarter with positive margin trend, which has been driven by volume recovery and continued stable cost and pricing situation in the region. The sequential improvement from the first quarter was primarily driven by price increases for graphic paper. Operating rates for the region continue to increase to 76% in the second quarter, And we are now actually coming to the levels we haven't seen since beginning of 23, which is very encouraging. Now, heading into the third quarter, we will carry out maintenance shutdown at Escanaba mill. And we will have additional maintenance, partly in preparation for the evolution program. So we expect sequentially higher maintenance costs of 160 million for the region. Next slide, please. And I would like to spend a couple of minutes on the input costs. Now, in terms of the input costs for the regions, we are now in a much more stable situation also in Europe. The cost development during the second quarter was fully in line with our expectations, and we had a net cost relief of approximately 40 million, primarily from electricity prices in Europe. Heading into the third quarter, we expect continued stable cost situation for both of our regions. And on the Nordic pulpwood, we now see a trend shift. The pulpwood prices are coming down. We decreased our price list during the quarter and have seen further downward adjustments by other wood purchases. We see good availability that will continue into the third quarter. and expect also that the downward pressure on the pulpwood prices will intensify. With that said, the cost impact for billy root in the third quarter will be limited, and that is due to our sourcing mix during the summer, where many of the sawmills are closed. But we certainly expect the cost to come down further into the year. Next slide, please. Now, with the newly introduced financial targets, we are emphasizing cash generation as one of our key priorities. And I'm particularly pleased with the cash conversion of 131% for the second quarter. Our cash flow from operating activities more than doubled compared to the first half of last year. And we are making a good progress on reaching the cash conversion of about 80% for the full year. The strong cash generation is certainly supporting our strong balance sheet. And even after dividend payout during the quarter, we maintain our leverage in line with the first quarter at around 1 times EBITDA. In terms of the capex for the rest of the year, we now estimate the total capex of 3.1 billion for 2025, which is 400 million lower versus our previous outlook. And that is primarily driven by slow investment pace for our evolution program in North America. And we now expect that that amount will be pushed into 2026. With that, I would like to hand it back to you, Ivar.

Thank you, André. Now, an essential part of our strategic framework, the way forward, is to focus on items we can control. and avoid being distracted from mixed factors that we literally can do nothing about. And challenging conditions mean we truly need to be at our best to further improve our competitiveness and outperform our peer group. We have successfully been disciplined on fixed cost spending. You'll need to be even more aggressive and creative in finding new additional saving opportunities throughout our cost base. As you just heard from André, protecting your cash flow is of utmost importance And we certainly aim to continue the strong start of the year and land the year with 80% plus conversion. Another priority is to carefully drive our most profitable and most structurally attractive mixed opportunity with focus. And lastly, improving our meal efficiency across and secure supply chain reliability and predictability towards a large and diverse customer base. These points have been a priority for some time, and they will continue to be so. So next slide, please. So to round it up, and going into Q3, we do expect continued solvent conditions for region North America. In region Europe, there are some variations across channels and categories, but overall, we would expect the market to stay weak, and input cost should stay quite flat. across the regions. So with that, I hand it back to operator for Q&A.

Thank you. To ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. We will now take the first question. And your first question comes from the line of James Perry from Citi. Please go ahead.

Good morning and thanks for the presentation. Just a couple. I'd first like to ask about the wood costs. You mentioned that you've seen the first price reduction in the Nordic wood prices. Are you able to share what kind of magnitude of price decreases you're seeing and whether you think it's just temporary relief or negative momentum from here? And secondly, on North America, you said about the positive sales volumes and the higher interest in domestically produced products. I know it's difficult to determine, but do you have any sense as to whether customers are looking for a temporary workaround or have they been interested in long-term contracts? Thanks.

Hi, good morning, James. I will start by commenting on the Woodco. So, as I mentioned, we have seen a good availability in the beginning of 2025, and that situation has continued also in the second quarter and will continue in the third. We have seen prices in Baltics and also in Norway coming down. We decreased our price list with five to 10% from the list prices and seen additional price reductions since then. As I mentioned, the quarter three, we have a bit different sourcing mix. But if we would look at the impact beyond that at this point, and with the price list changes we have seen, we would estimate a positive cost impact of 40 to 50 million. But again, not much of that in quarter three.

So, hi, James. I can take the second question about the North America. I think it's difficult to get customers to sign in blood that this is long term. But I can say that that process of going through the qualification and changing a supplier is to a certain extent a bit painful. There are some efforts being required on both sides. And you can certainly say that once you come to the step that you have been finding a way in, that is expectation. It will remain and it stays, so hence a much more long term. So we are clearly very much under the view that once we start opening the doors and can illustrate a good power performance, that is the start of the journey. And we expect just this now to snowball further into bigger figures going into 2026.

Okay, thank you very much.

Thank you. Your next question comes from the line of Lars Schellberg from Stifel. Please go ahead.

Yeah, good morning, and thanks for taking my questions. Just to follow up on the pulpwood one, you mentioned Baltics and Norway prices have declined. And then you talk to list prices, which I suppose refer to Sweden. That's not the same as prices are coming down just because you call list prices down. So the question is, are you having any success in lowering those list prices, i.e. wood flowing in at lower prices also in Sweden? And then I just wanted to get some color on Asia. You mentioned liquid paperboard markets being particularly challenging and competitive. and we can kind of see from your liquid paperboard sales that they're down quite a bit. Are you seeing then local competition, particularly in those Asian markets, in liquid paperboard, which used to be sort of a, broadly speaking, an oligopoly between three producers? And are those, if that is indeed the case, are they breaking into other markets? You mentioned some volumes. generally, I suppose, from China coming into the U.S. But it would be interesting to hear some color on that specific market. And then finally, in North America, you speak to solid performance. But then again, if we actually take away the benefit of the maintenance activity, the schedule change, you're actually down in North America. So what explains that sort of quality 50 million drop year on year? in underlying performance adjusted for maintenance? That's my question.

Good morning, Lars. I will start by providing additional comments on the pulpwood. So when we look at the price list in the Nordics, in Sweden, again, those are underpinned by good availability and the moves we see on the price list. And we certainly expect that we will be able to purchase wood going forward on the newly announced price list.

Yeah, morning Lars, I'll jump into the second. I think it's a fair question, and let me just try to give some color on what we see on the liquid packaging these days, because it is a bit of a mixed picture. We are seeing that the market is more or less flat, and that is more on the kind of global basis, you know, around zero to 1%. So there are some pretty hefty regional differences. China now is in decline, While we see more growth in India, other items in Southeast Asia and North America. And Europe is also quite flat. And our business then in terms of the supplies into Europe are performing well and more under stable conditions. So it is so that much more challenging Chinese market and consumption being much more muted, that hits us as well. As I said, it's a big market for us to deliver into. And hence that Asia not growing and in decline, that is certainly an effective deal. It is also so that some of our customer base in some of the key markets in Asia are losing share. And that also, of course, impacts us based on our exposure to a certain customer base. But I can confirm to your question that we are meeting some competition from local players in China in particular, and they've been able to gain some meaningful share over the last time. Yeah, if you take it off, André.

Lars, getting back to the performance in North America, they have, of course, been heavily impacted, or the results in the Swedish krona has been heavily impacted by the change in FX. So that's shaving off approximately one percentage point in EVTA year over year.

Actually, if I can just have a follow-up or another question. seems to be comparatively stable and reasonable in Europe. Can you share any color on how that market has progressed? You call that better pricing realization in the market, which would suggest less of an issue with, I guess, excess supply and less demand weakness, but some incremental color on that would be helpful.

Yeah, I can take that one. Yeah, I mean, there is no doubt that... The excess supply is certainly most notable within board, particularly within paper board. I think from what we see on our side is a bit more balanced market, but the underlying consumption is still weak and it worsened a bit during the quarter. Customers holding a bit back on some orders. And it has just been a sentiment that we just felt more on the demand side. But yes, it is in a relatively better shape versus what we see on the board side. Thank you.

Thank you. Your next question comes from the line of Robin Santiverta from D&B Carnegie. Please go ahead.

Yes, thank you very much. First question is related to the demand in Europe, looking at your delivery volumes down 6% year on year, and I think you provided three reasons for that. But I was also wondering whether there's potentially some destocking among your clients, given this uncertainty that we have after Liberation Day, or is this underlying demand, this minus 6%?

Yeah, hey, good morning, Robin. No, I think it's always difficult to pin it down exactly what drives what. But yes, I think there is a part of that, maybe towards the end of the quarter, where in particular, a lot of a customer base as well look to protect their cash generation since market is tough. And yeah, I mean, I think... also look at some you know the historical behavior will meet when pulp pricing tend to fall as it has during the quarter i'm sure so there are certain customer behavior that would expect you know material packaging pricing to follow and again hold a little bit back so there's a part of it for sure especially towards the end of the quarter difficult to pinpoint exactly how big that impact is thanks uh second question i have is related to the

output pricing could you just provide a bit more detail about like per cube where we stand at the moment is it so that you have got the price by 30 sec per cube and then there's some 50 sort of sec per cube cuts out there right now and if that would be the case wouldn't the impact be a bit bigger than 40 to 50 ones that would

Yeah, I can continue, Robin. So we have decreased our price list with 30 sec per cubic meter on the softwood and 50 actually on the hardwood. And these are also the changes we have seen happen since then. In terms of the impact for reminder of the year, It depends on which price list you purchase on, in which regions, to which mills. But currently, our assessment is that will be in that region.

And can I just ask, what is the P&L lag from you buying this wood at lower prices? Is it three months? It's two to three months, approximately. Thanks. A final question, just a quick one on capital allocation. The balance sheet is still quite strong. I understand it's tough out there, particularly Europe. What about potential share buybacks? Is that something that now the stock is close to, what is it, a five-year low? Is that something that you could take a look at this autumn?

Yeah, no, it's a fair question. I can just say that there's no discussions happening with the board on this. But it's obviously not a normal discussion that will surface during the second half of the year. And of course, we will come back if there are any news or any intervention we would decide or the board would decide. But for now, there's nothing. It's full focus on our side. to continue our improvement of the items that we can control.

Perfect. Thank you very much.

Thank you. Your next question comes from the line of Linus Larsen from SEB. Please go ahead.

Thank you very much, and a very good morning to everyone. A couple of questions on Europe, if I may, starting with volumes, shipments. in the second quarter were on their lowest levels. That was seen for many years actually, and I think they were even somewhat lower than you had expected yourself. So is your message now that you're expecting the same level of shipments from Region Europe in the third quarter? And also in relation to that, how are you looking at this in terms of potential restructuring, when you look at your current footprint, are there certain measures that you are evaluating?

Good morning Linus. So in terms of volumes and getting a bit back to what Ivar talked about, there are two things. First of all, the underlying demand is not where we would expect it to be uh long term and we also have the over supply partly due to you know capacity increases in the region but also change to the to the trade flows uh with those two things out there uh we do expect you know the situation for core three to remain weak But it is also with very high uncertainty around what things are going to change in quarter three. And hence, at this point, it is just difficult to predict volumes for the third quarter. Our order books are weaker now versus where they have been when we went out for the first quarter. difficult to predict and provide any more specifics on volumes for the third quarter at this point.

Hi, morning Linus. I'm just jumping into your second point, which Yeah, I mean, we do have a profitability target of 15% EBITDA, with clear regional targets broken down that we shared in the CMD. We are certainly far away from that. And the gap is in Europe. And as I mentioned in my part earlier, we will need to be aggressive and creative on the full cost base and continue to challenge that. That might mean that there are additional structural savings that are coming. And if so, we will come back to that topic later in the year.

Cool. Thanks. That's super helpful. And then staying on Europe, just on price, ASP came down quite a bit the year and year in the quarter. And if you could just help us dissect that please into what was currency, what was mixed, what was actually price and also what your expectations are for price in Europe and mix in the third compared to the second quarter.

Yeah, Linus, I can start with the second part of the question. We don't Again, based on what I mentioned in terms of volumes, we don't expect any major shifts in the mix heading into the third quarter. Just in terms of the pricing, also looking forward, we are meeting a weaker market. Our starting point is to defend our pricing positions, also on the back of stability in our input costs. But we need to acknowledge the weakness and we certainly expect some pricing pressure to come through during the third quarter. First and foremost, I think within container board and carton board. But we will of course defend our positions. If we look at development in Europe year over year, there has also been a hefty currency impact. If we look at currency neutral sales for region Europe, they were down 4% versus last year. And the majority of it was actually driven by mix due to the weaker volumes we had this quarter.

Great. also very helpful. May I just add one final question? You wrote about this negative inventory revaluation. Could you just please clarify that? Did you have, and if so, how much was the negative inventory revaluation in the second quarter? What was it in the first quarter? And if you at all have any anticipation for the third quarter, that would be of interest as well.

Yeah, for the second quarter, we had a negative revaluation impact of approximately 15 million. So really no drama and where we would expect it normally to fluctuate. But looking at the second quarter last year, we had quite sizable positive impact of approximately 80 million. So hence, year over year, quite significant deviation. Heading forward now, we don't expect any major movements there, again, based on the stability in the input costs.

Okay. That's great. Thank you very much.

Thank you. Your next question comes from the line of Cole Hawthorne from Jefferies. Please go ahead.

Morning. Thanks for taking my question. I'd just like a... follow up firstly on Europe I mean when I go back to the Q1 report you talked about decent order books and you know I know the market changed but I'm just wondering was the deterioration really in June that you saw the impact and kind of pull back in volumes and was the volume pull back compounded by the operating deleverage that you saw I mean is this really an operating deleverage across your asset base effect rather than anything else? And how can you improve the operating rates of your mills in Europe? Does it mean that you take some longer economic downtime and ways to save costs, or does it require more of a permanent solution to remove capacity? Thank you.

Yeah, hi. Good morning, Cole. I can take that one. No, again, I can confirm that the situation got gradually worsened during the quarter. And yeah, it is soft that, you know, when we started the quarter, our order books at that time looked a bit more decent. And as also André said, now they are weaker than we now are in the beginning of the quarter. of July. I think it's again difficult to exactly pinpoint what is what impact carrying its weight but there's just no doubt that consumer demand has been delayed in terms of getting to recovery and that is spreading gradually also to a customer base being worried about what underlying strength is and protecting their own cash generation and certainly the tariffs and the relocation of some of the volume back to Europe has just not helped. But it was a gradual impact that intensified towards the end of the quarter, no doubt. I think in terms of operating rates, there is little doubt that we need to manage this almost on a weekly basis. It's one of the core questions that the region, you know, wrestle with. And we have some leeway to either take down time some days or, you know, slow steam. But surely now we run quite a bit lower than our normal capacity is and certainly also quite a bit lower. then we would fall out. So yeah, it's the same for the whole sector. We're doing what we can and we've been quite successful so far of maneuvering this and protecting our cash flow as you saw earlier in the deck.

And then maybe if I just follow up on North America, which is a more positive story, but when I think about that North America division into the second part of the year, Can you give any commentary on, you know, how you're benefiting from kind of the import tariffs supporting, you know, speciality and graphic paper? You know, are you comfortable that you're going to continue to be at a decent operating level there? And then secondly, I know pulp prices are lower, but given potential tariffs on Brazil, how would your business perform? Would you be a net beneficiary from pulp sales domestically in the US? Thank you.

Yeah, why don't I start and Andre, you can jump in if you have anything. But yeah, I want to say in the second half, I mean, comfortable and comfortable. I think we are in a very good place. And I think we've proven this now continuously over years that we are well placed and we have a very strong starting point, you know, where we can be the local player. who offer speed and reliability and predictability. That has worked super, and we expect that still to continue. I mean, as an example, the order books are much stronger as a relative comparison in North America when we go into Q3. Sure, there are topics, and let's say that the phone is ringing quite more frequently now in the light of the uncertainty we are facing on tariffs. We are certainly also calling a lot of our potential new customers to remind them of where we stand and we are ready to deliver. And surely that has helped us, but it's not been a tsunami, but it's been a good testament of the growth we've seen. If some of these tariffs will become permanent at the high level, I mean, that's surely going to be a benefit, but it's speculation, as you know, at this time, since This situation with the trade agreement can change extremely fast. But overall, we are in a very good place and super impressed of what the North American team are able to produce quarter after quarter. Yeah, on top, it's interesting, as you mentioned, we are a bit long. on pulp in North America, on the hardwood maple pulp, about 200,000 or some 200,000-ish. We'll see. I mean, there's no doubt that a big chunk of the tissue production capacity in North America is supplied from Brazil. You know, with that tariff now on the table will remain or stay. I mean, clearly that would benefit the remaining players of locally produced North American pulp will be one of them. But again, it's true to say anything. It can be an agreement or that is removed tomorrow or next week, as we've seen. But surely if it stays on long term, this should help us for sure.

And then maybe just a clarification. You called out the particular oversupply in paperboard, but were you referring more to kind of the folding cotton industry the box board side rather than the container board or just a little bit of specifics around which was the relatively weaker and more impacted by the oversupply.

Thank you. Yeah, I think we talk about carton board and... And liner, first and foremost. I think fluting for us, or at least our Nordic fluting, is a bit more protected. As you know, it runs on separate machines. So, yeah, liner in particular, coated on coated, and carton is the bigger one referred to. Thank you.

Thank you. As a reminder, if you would like to ask a question, please press star 1 and 1 on your telephone keypad. That is star 1 and 1 to ask a question. We will now go to the next question. And your next question comes from the line of Martin Malby from ABG Sundalcolia. Please go ahead.

Yes, good morning. You had a couple of comments there on price, quarter of a quarter for Q3. Are you basically saying flat or down with pulp?

Yeah, I can repeat that, Martin, and good morning. So again, given the situation where we are, we do expect weaker market conditions to persist for the European side into the third quarter. Again, our starting point is that we will defend our pricing positions, but we do expect some pricing pressure. So any other guidance than that, I wouldn't be able to provide at this point. For North America, we expect stable prices for our paper grades. Now the pulp prices have come down. We expect roughly 5% lower pulp prices for the North American region, which is a half percentage point for the whole region.

Thank you. And on the maintenance costs, you have some different numbers in the presentation compared to the report. So if I get this right, you say 440 in the presentation, but like 380 in the report. And what is the difference?

Yeah, so the difference is that when we call out in our report is the planned maintenance shutdowns where we close essentially our recovery boilers and stop all of the productions. But in the preparation for the evolution program in North America, we will take some additional maintenance. That is not CapEx, but it is maintenance, and that will add some additional costs into the third quarter for North America.

I see. And last question. On the financial items, is minus 111 clean, or is that FX loss-including?

Now, that is impacted by the changes in the FX rate, so that includes revaluation of our cash balances in foreign currencies. The underlying interest costs are around 60 million, so the reminder is FX primarily. Excellent. Thank you.

Thank you. Your next question comes from the line of Oscar Lindstrom from Danske Bank. Please go ahead.

Yes. Three questions from my side. First two on volume curtailments. How are you distributing the production curtailments between mills? Are certain of your mills in Europe more severely impacted by production curtailments? Are there perhaps even entire machines which are being taken offline? Yeah, that's the first question.

If you just give all of the three and then we'll start from the top.

Okay, yeah. So the first question is how you're distributing these production curtailments between mills and if there's entire machines which are being taken offline. or if it's really just sort of day by day. The second question is, are other producers in Europe, in your different niches, also taking production curtailments? What's your impression here? And then the third question, you mentioned that there was a delay in CapEx in North America for the reason for taking down your full year CapEx guidance. What's the reason for the delay? Is it by choice or is there another reason?

So, Oskar, good morning. I can start with the first two and I'm sure Andrey will jump in the third. I think when we have this situation where we start to see softer demand and we need to, I call it wrestle through it. It's one of the key points we have in our sales and operational planning. And, you know, it's a bit of a chessboard that moves quite a lot. There are no machines that are fully done, that I can say. And, you know, we have had slow steam or, you know, you can call it some downtime or curtailment more on the board side during Q2 versus what we saw on the paper side. I mean, the paper in general have performed a bit stronger through the quarter. And, I mean, merging that into your question number two, I can, with quite high likelihood, confirm that i think this curtailment on production is the theme of q2 for you know pretty much everyone in the industry and uh yeah i i expect a lot of the same companies in this sector to report you know how they've been able and needed to take down time and slow steaming to maneuver to what we currently see

Yeah, I can take the question on the CapEx, Oscar. So the 400 million that we push into 2026 from 25, that is primarily the evolution project in North America. And it is just more detailed planning of when we will carry out the investments. As you know, we don't have any maintenance shutdown in Quinnisec mill. So we want to time that into the maintenance shutdown, but also make more investments during the next maintenance shutdown in Escanaba. So that's a deliberate choice to adapt it better to the plant production there.

All right. Thank you very much.

Thank you. There are currently no further questions. I will hand the call back to you.

With no further questions, we have come to an end of this conference. Welcome back when we report our third quarter that is on the 23rd of October. Thank you for participating.