July 23, 2020 / 6:44 AM / in 17 days

CORRECTED-UPDATE 1-Finnish forestry firm UPM quarterly profit falls less than expected

(Corrects to show profit fall smaller than expected)

July 23 (Reuters) - Finnish paper and pulp producer UPM reported on Thursday a smaller-than-expected fall in quarterly profits, saying lockdowns hit paper demand and prices.

UPM’s earnings before interest, tax, depreciation and amortisation (EBITDA) for the April-June quarter fell to 320 million euros ($371 million) from 466 million a year earlier, beating the 295 million expected by analysts in a Refinitiv Eikon poll.

“The lockdown of businesses, offices and schools caused a drastic decline in printed advertising and use of office papers,” Chief Executive Jussi Pesonen said in a statement.

“Demand for graphic papers seriously suffered as a result of lockdowns, whereas labels and speciality papers saw strong demand and delivered excellent results,” Pesonen said.

UPM said the pandemic, the related lockdowns and the economic downturn have caused a high level of uncertainty for the second half of 2020, and forecast full-year comparable operating profit to fall significantly from 1.4 billion euros in 2019.

The company forecast a moderate rise in paper prices during the second half of the year from the first half.

$1 = 0.8633 euros $1 = 0.8634 euros Reporting by Tarmo Virki in Tallinn; Editing by Edmund Blair and Alex Richardson

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