(Bloomberg) -- Stora Enso Oyj appointed its board member, industry veteran Hans Sohlstrom as its new chief executive officer with immediate effect as the Finnish packaging company seeks to mitigate the hit on earnings from lower demand.
Annica Bresky, the first woman to serve as the chief executive of the company, will leave after just under four years in the role, Stora Enso said in a statement on Monday.
Sohlstrom, 58, has spent the past decade as CEO at Ahlstrom Oyj, Ahlstrom Capital Oy and Rettig Group Oy. The early part of his career consisted of various roles at UPM-Kymmene Oyj, where he climbed through the ranks from marketing to leading factories and later entire divisions.
Sohlstrom now steps down from the board, Stora said.
Bresky, 48, had overseen Stora through the Covid-19 pandemic when packaging demand skyrocketed, as well as through the immediate aftermath of Russia’s full-scale invasion of Ukraine which cut off its wood supply from the eastern country.
In recent months, the company has been seeking ways to mitigate the impact of a downturn in the cyclical packaging industry as people globally cut consumption in the face of inflation and higher borrowing costs, reducing the need for boxes and other shipping materials.
The company’s operational earnings before interest and tax have missed estimates on three straight quarters and earlier this month it announced the reduction of 710 jobs.
The new CEO is expected to focus on “protecting profitability amid the challenging market” rather than push for any “major strategy changes,” according to Olli Eloranta, a credit analyst at Danske Bank A/S. Sohlstrom is a “solid choice” for the role, he said in a note to clients.
Born in a merger of two paper makers in 1998, Stora has all but left that business. Under Bresky’s leadership, it took the decision to divest the bulk of its paper production as people ditched printed newspapers, directories and catalogs in favor of the internet.
Read More: Stora Enso Nears Paper Exit With Plan to Divest 75% of Output
The company has spent the past years reinventing itself, tapping some global mega trends, as the shift to online shopping has created new demand for packaging and growing climate awareness has raised the appeal of renewable and recyclable materials in the place of plastic.
Bresky oversaw the acquisition of the De Jong Packaging Group of the Netherlands for just over €1 billion ($1.1 billion), announced last year, and began a push to increase the use of wood as a construction material.
Among Stora’s peers, UPM CEO Jussi Pesonen will retire from the company during 2024 after 20 years in the helm and Billerud AB is currently looking for a new chief executive.
--With assistance from Christopher Jungstedt.
(Updates with an analyst comment in seventh paragraph)
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