NEW YORK — Mercer International Inc., a global forest products company, has reported its second quarter 2025 Operating EBITDA of negative $20.9 million, a decrease from positive $30.4 million in the same quarter of 2024 and $47.1 million in the first quarter of 2025.

In the second quarter of 2025, net loss was $86.1 million compared to $67.6 million in the same quarter of 2024 and $22.3 million in the first quarter of 2025.

Juan Carlos Bueno, president and CEO, stated: "Our operating results for the second quarter of 2025 reflect the impacts of ongoing uncertainties in the global trade environment, coupled with the resulting weaker dollar. This challenging backdrop contributed to weaker demand for pulp in China during the quarter. The related depreciation of the dollar relative to the euro and Canadian dollar had a negative impact of approximately $26 million on our Operating EBITDA for the second quarter of 2025 compared to the first quarter. The second quarter also included an $11 million non-cash impairment on hardwood inventory at our Peace River mill stemming from lower hardwood prices in China because of weaker demand."

Richard Short, chief financial officer, stated: "Tariff uncertainty and global trade disputes were the root cause of the company's disappointing Q2 results. As these uncontrollable economic conditions create macroeconomic headwinds, we will continue to focus on things that we can control. For example, we're beginning to see an improvement in our reliability as all our mills ran well this quarter." 

The company has implemented cost reduction initiatives and operational efficiency measures to build resiliency through this economic cycle. 

"We refer to this program internally as 'One Goal One Hundred', reflecting our entire team's steadfast commitment to achieving our target of $100 million in profitability improvement actions by the end of 2026, using 2024 as a baseline," says Short. "We have identified core areas for permanent and one-time improvements to our bottom line, and these efforts are progressing and in varying stages of implementation. To date, we have realized approximately $5 million in cost savings and anticipate achieving $25 million in savings by the end of 2025. We also expect further profitability improvements in 2025 from ongoing operational efficiency initiatives. We believe we are currently tracking to meet our target in 2026." 

In the second quarter of 2025, third-party softwood pulp list prices in Europe remained relatively steady compared to the first quarter of 2025, while North America saw a modest increase driven by stable demand and supply constraints. In China, third-party pulp net prices decreased in the second quarter of 2025 as a result of weakened demand stemming from global trade policy uncertainty. The company anticipates a decrease in softwood pulp prices across key markets amidst the current economic environment and seasonality heading into Q3. For hardwood pulp prices, Mercer expects relatively steady prices in the third quarter of 2025.

The company saw a 6% decrease in lumber production. Short stated that a key driver of this decrease was due to planned maintenance at Friesau, Germany, sawmill. Overall, the company is pleased with the lumber production in Q2 and looks forward to the incremental lumber production at Torgau, Germany, which will provide approximately 65 million board feet of annual lumber capacity. 

Overall, per-unit fiber costs for pulp and solid wood segments increased in the second quarter of 2025 due to strong demand. In the third quarter of 2025, the company anticipates per-unit fiber costs for German pulp mills to be lower, driven by reduced demand, and the Canadian pulp mills to be relatively stable. The company also noted that their pulp mills had 29 days of downtime, which included planned maintenance and slower-than-expected startup days. Looking ahead, Bueno noted fiber costs are expected to modestly decrease with a 10% increase for the solid wood segment in Q3. 

Mercer's mass timber business has maintained a healthy order book despite the ongoing elevated interest rate environment in the U.S. In that business, the company is seeing a significant increase in "win rate" on new project bids, which should positively impact results in 2026. Bueno noted potential sales volumes exceeding $400 million and over 100 projects per quarter. 

Bueno concluded: "Despite the temporary and unpredictable market and global trade policy related challenges that persist into the third quarter, we remain focused on our aggregate liquidity and debt reduction strategy. Our team has made good progress to date on our "One Goal One Hundred" profitability improvement program and pursues efforts to preserve cash. We are taking the added step of suspending our quarterly dividend. We view this as prudent from a capital allocation standpoint as we navigate the uncertain global trade environment. We reiterate our long-term commitment to a competitive dividend as these uncertainties are resolved."