Mercer narrows net loss to $59.2 million as operating EBITDA remains negative
Key Facts
Mercer International narrowed its third-quarter 2026 net loss to $59.2 million, or $0.88 per diluted share, compared with a loss of $80.8 million, or $1.21 per share, a year earlier. The company reported its results in a November 5 statement, noting that the loss also narrowed from $76.0 million, or $1.13 per share, in the second quarter of 2026. The company remained loss-making, but operating EBITDA showed a clear improvement during the quarter. Its loss was $2.9 million, compared with $28.1 million in the third quarter of 2025 and $21.0 million in the second quarter of 2026. By contrast, annual revenue declined, reflecting continued pressure on operations despite the narrower losses.
Revenue was $440.7 million, down about 4% from $458.1 million in the year-earlier period. Mercer attributed the decline mainly to lower pulp sales volumes and weaker realized prices for the product. The impact was partly offset by higher sales prices for energy and solid wood products. Total pulp sales fell about 7% to 421,413 air-dried metric tons, from 452,840 tons a year earlier. The company said the lower sales volume was mainly linked to reduced production, weighing on revenue alongside weaker prices.
Pulp production fell to 406,519 air-dried metric tons in the third quarter, down about 11% from 458,708 tons in the same period of 2025. The company attributed the decline to planned maintenance, lower output at its German mills amid higher fiber prices, and mechanical issues at the Celgar mill. These factors also affected sales volumes, which declined year over year. Mercer said the pulp market saw weak demand, while regional excess capacity in China kept prices stable. Production and pricing pressures thus coincided with lower segment revenue.
Mercer linked the year-over-year improvement in EBITDA to government grants recognized at its Peace River mill, cost-cutting initiatives, and higher sales prices for energy and solid wood products. The company said these factors supported operating results compared with the third quarter of the prior year. But higher fiber and freight costs and lower pulp sales prices limited the improvement. Operating EBITDA remained negative at $2.9 million, although the deficit narrowed compared with both periods. This shows that the improvement in the operating metric was not accompanied by a return to operating profitability during the quarter.
In market trading, EL7 data showed Mercer shares closing at $0.2493 on November 5, 2026. Recorded closes were $0.12 on October 30, $0.126 on November 2, $0.212 on November 3, and $0.25 on November 4. These figures provide context for the stock’s movement in the preceding days, while the available evidence does not include documented intraday trading after the results announcement. The change on the announcement day therefore cannot be attributed to the results on the basis of these data alone.
Mercer expects modest increases in softwood pulp prices across all its markets in the fourth quarter of 2026, with hardwood pulp prices relatively stable. The company is scheduled to report its next results on February 18, 2027, and hold a conference call on February 19 at 10:00 a.m. U.S. Eastern Time. The company said its operations would continue in the ordinary course as it implements a recapitalization through its parent company and a non-operating subsidiary in Texas, with no impact on customers, suppliers or employees. It added: "Our operations will continue in the ordinary course without impact to customers, suppliers and employees."