UPM Annual Report 2025

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cash flows, which is a change from current presentation as part of operating cash flows. The Group will apply the new standard from its mandatory effective date of January 1, 2027. Retrospective application is required, and the comparative information for the financial year ending December 31, 2026 will be restated in accordance with IFRS 18. For the first annual period of application of IFRS 18, a reconciliation for each line item in the statement of profit or loss between the restated amounts presented by applying IFRS 18 and the amounts previously presented applying IAS 1 is required.

10.2 Forthcoming new standards, amendments and other accounting policy changes Certain new accounting standard amendments and interpretations have been published that come into effect only after the reporting period started on January 1, 2025. These standards and amendments are not expected to have a material impact on the Group in the current or future reporting periods and on foreseeable future transactions and have not been early adopted. IFRS 18 will replace IAS 1 Presentation of financial statements, introducing new requirements that will help to achieve comparability of the financial performance of similar entities and provide more relevant information and transparency to users. IFRS 18 will not impact the recognition or measurement of items in the financial statements, but its impacts on presentation and disclosure are expected to be pervasive, in particular those related to the statement of financial performance and providing management-defined performance measures within the financial statements. Management is currently assessing the detailed implications of applying the new standard on the Group’s consolidated financial statements. Although the adoption of IFRS 18 will have no impact on the Group’s net profit, the Group expects that grouping items of income and expenses in the statement of profit or loss into the new categories will impact how operating profit is calculated and reported. From the high level impact assessment that the Group has performed, the following items might potentially impact operating profit: • The Group currently recognizes some foreign exchange gains or losses in operating profit and others in financial income and expenses. There might be a change to where these gains or losses are recognized, and the Group is currently evaluating the need for change. • The Group currently recognizes some derivative gains or losses in operating profit and others in financial income and expenses. There might be a change to where these gains or losses are recognized, and the Group is currently evaluating the need for change. The line items presented on the primary financial statements might change as a result of the application of the concept of ‘useful structured summary’ and the enhanced principles on aggregation and disaggregation. The Group does not expect there to be a significant change in the information that is currently disclosed in the notes because the requirement to disclose material information remains unchanged; however, the way in which the information is grouped might change as a result of the aggregation/disaggregation principles. In addition, there will be new disclosures required for management-defined performance measures. There will also be changes to how interest received and interest paid are presented in the consolidated cash flow statement. Interest paid will be presented as financing cash flows and interest received as investing IFRS 18 Presentation and Disclosure in Financial Statements

Parent company accounts (Finnish Accounting Standards, FAS)

Income statement

€ million

Note

2025 2,470

2024 2,599

Sales

1

Change in inventories of finished goods and work in progress

-9

-10

Production for own use Other operating income

3

3

2

116

79

Materials and services Raw materials and consumables purchased

-2,007

-1,956

Change in inventories

9

26 -9

External charges

-9

-2,007

-1,938

Personnel expenses Salaries and fees

-196

-206

Indirect employee costs Pension costs

-33

-35

Other indirect employee costs

-6

-5

3

-234

-247

Depreciation, amortization and impairment charges Depreciation and amortization

-95 -95

-103 -103 -287

4 5

Other operating expenses Operating profit (loss)

-327

-82

96

Financial income and expenses Income from non-current assets Dividend income from Group companies Interest income from Group companies Other interest and financial income Other interest income from Group companies Other interest income from other companies Other financial income from Group companies Other financial income from other companies Impairment charges and reversals on investments Interest and other financial expenses Interest expenses to Group companies Interest expenses to other companies Other financial expenses to Group companies Other financial expenses to other companies

1,052

479

0

8

106

144

13

24 39

0

194 -60

130

-226

-115 -95 -55

-156 -102

0

-16

-112 228 323

1,024

Profit (loss) before closing entries and tax

942

Closing entries Depreciation difference

21

20 57

Group contributions received Group contributions granted

227 -17 231 -24

-7

70 -12

Income taxes

6

Profit (Loss) for the period

1,148

382

UPM Financial Report 2025

328

UPM Financial Report 2025

329

328

329

UPM Annual Report 2025

UPM Annual Report 2025