Slide 1: Interim report presentation January-September 2023
Interim report presentation January-September 2023 Henrik Sjölund, CEO Anders Jernhall, CFO October 25th, 2023
Slide 2: Strong result despite soft market conditions
Group Strong result despite soft market conditions Operating profit* Operating profit* SEKm SEKm 8 000 2 500 7 000 2 000 6 000 5 000 1 500 4 000 7 262 1 000 2 101 1 921 3 000 1 617 1 622 1 737 5 663 1 129 1 185 1 138 1 166 2 000 4 061 500 2 476 2 345 2 479 1 000 0 0 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-
Slide 3: Solid financial position
Group Solid financial position Distributed 3.7 bn SEK via dividends & share-buy back Capital employed SEKm Cash flow 8 000 7 000 6 000 5 000 4 000 3 000 % Debt/equity ratio 2 000 25 20 1 000 15 0 10 18 19 20 21 22 M12** 5 Dividend Capital expenditure* 0 Acquisitions Buy-back of own shares 18 19 20 2
Slide 4: Forest
Forest 1.3 million ha total land area 1.0 million ha productive forest land
Slide 5: Scarcity of pulpwood & timber in the Nordics
Forest Scarcity of pulpwood & timber in the Nordics Purchase price Index (Holmen average) 180 170 1 Mm3 160 150 0.2 Mm3 140 130 120 3 Mm3 7 Mm3 110 100 90 2 Mm3 80 70 2 Mm3 60 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Saw logs Pulpwood 5
Slide 6: Prices 30% higher than long term trend
Forest Prices 30% higher than long term trend Price SEK/m 3sub 700 600 500 400 300 200 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q3-23 6
Slide 7: Price increases translating into higher profits
Forest Price increases translating into higher profits No forest property sales in 2023 SEKm SEKm 600 1 600 1 400 500 1 200 400 1 000 300 800 1 495 1 541 513 1 367 1 401 600 1 185 1 172 200 402 390 397 349 346 351 323 305 400 100 200 0 0 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 18 19 20
Slide 8: Paperboard
Paperboard 550 000 tonnes per year
Slide 9: De-stocking & low consumption by end-users
Paperboard De-stocking & low consumption by end-users European SBB and FBB demand kton 3 500 3 250 3 000 2 750 2 500 2 250 2014 2015 2016 2017 2018 2019 2020 2021 2022 M12* *Q4-22 – Q3-23. 9 Source: CEPI
Slide 10: Prices fairly stable
Paperboard Prices fairly stable Prices Index 250 200 150 100 50 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 FBB Pulp NBSK* 10 *Adjusted for rebates. Source: RISI, FOEX
Slide 11: Production curtailments impacts profitability
Paperboard Production curtailments impacts profitability Maintenance stop Q2 & Q4 SEKm % SEKm % 500 50 1 200 25 400 40 1 000 20 300 30 800 15 200 400 20 600 1 081 281 274 299 10 256 100 10 400 812 152 689 673 112 111 512 5 0 0 200 435 -49 -100 -10 0 0 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23
Slide 12: Paper
Paper 1 million tonnes per year
Slide 13: Paper prices down from the peak
Paper Paper prices down from the peak Prices Index 250 200 150 100 50 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Uncoated magazine Pulp NBSK* 13 *Adjusted for rebates. Source: RISI, FOEX
Slide 14: Energy still expensive on the continent
Paper Energy still expensive on the continent Low utilisation gives poor fixed cost absorbation Uncoated publication paper capacity (WE) EUR/MWh Power prices Germany 250 Sweden Norway 200 Finland 150 Belgium UK 100 Switzerland France 50 Netherlands Spain thousands tons 0 18 19 20 21 22 23 0 500 1 00
Slide 15: Strong deliveries in Q3
Paper Strong deliveries in Q3 Good cost position without help from electricity hedges SEKm % SEKm % 1 000 50 3 500 175 3 000 150 800 40 2 500 125 600 30 2 000 100 400 832 836 20 767 716 659 613 1 500 75 2 714 2 825 200 399 10 1 000 50 100 0 0 500 25 -9 329 509 73 70 -200 -10 0 0 Q3-21 Q4-21 Q1-22 Q2
Slide 16: Wood Products
Wood Products 1.5 million m3 per year
Slide 17: Some price erosion in Q3
Wood Products Some price erosion in Q3 Index 330 280 230 180 130 80 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Export price 'World Price' (FX-basket) Export price Sawn softwood (SEK) 17 Source: Swedish Forest Industries
Slide 18: EU forces concrete & steel to go green
Wood Products EU forces concrete & steel to go green First CBAM reporting period starting Oct 1, 2023 18
Slide 19: Price erosion & weak market mix impacting Q3
Wood Products Price erosion & weak market mix impacting Q3 SEKm % SEKm % 600 60 2 000 100 500 50 1 500 75 400 40 300 582 598 30 529 1 000 50 200 20 1 668 350 100 10 1 237 177 500 25 23 19 55 0 0 -67 62 246 185 29 -100 -10 0 0 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 18 19 20 21 22 M12*
Slide 20: Renewable Energy
Renewable Energy 1.8 TWh per year
Slide 21: Rainy summer pushed down Nordic prices
Renewable Energy Rainy summer pushed down Nordic prices Energy prices EUR/MWh 600 500 400 300 200 100 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 South Sweden (SE3) North Sweden (SE2) Germany Gas power 21 Source: Macrobond
Slide 22: Hydro flexibility pays off
Renewable Energy Hydro flexibility pays off Support services, timing SEK/MWh and Gurantees of Origin 600 500 400 300 200 100 0 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 22
Slide 23: Good result despite low electricity prices
Renewable Energy Good result despite low electricity prices Support services established as a new revenue stream SEKm % SEKm % 500 125 1 250 30 400 100 1 000 20 300 75 750 463 200 50 500 1 006 947 10 282 100 214 25 250 168 162 135 336 347 112 68 181 215 62 0 0 0 0 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22
Slide 24: Growing a sustainable future
Growing a sustainable future
Slide 25: Growing forests with increased biodiversity
Growing forests with increased biodiversity m 3 growing stock Forest holdings Development of biodiversity solid over bark/ha 140 100 120 95 100 90 80 85 60 80 40 20 75 0 70 1948 1955 1965 1975 1988 1993 2000 2010 2020 2022 1970 1980 1990 2000 2010 2022 Sweden Europe Global average 25 Source: Holmen
Slide 26: We grow houses
We grow houses Leftovers are converted into renewable packaging and paper We harvest the energy that blows and runs through our forests 1.3 Carbon sequestration 7.2 Million tonnes CO2e + 4.7 Storage and substitution from Million Million tonnes tonnes CO2e wood products (3.1), paperboard CO2e in 2022
Slide 27: Increasing our contribution to the climate
Group Increasing our contribution to the climate Climate benefit million tonnes CO2e 7,5 7,0 6,5 6,0 5,5 5,0 2019 2020 2021 2022 27
Slide 28: holmen.com
HOLMEN holmen.com