Slide 1: Q3 report 2024
Q3 report 2024 23 October 2024 Lennart Eberleh President and CEO Monica Pasanen CFO
Slide 2: Highlights Q3
40 MSEK ey EBIT for Q3 2024 Stable demand in selected niches mm) 319... High raw material costs Invested in assets during the year pad ® ROTTNEROS Highlights Q3
Slide 3: Market
Market Increased spread between BSK and BHK
Slide 4: Pulp market
PULP MARKET A cyclical USD/tonne Average quarterly price of NBSK Europe. SEK/tonne 1 600 16 000 NBSK list price at peak 1 400 14 000 1 200 12 000 Stable demand 1 000 10 000 800 8 000 Favorable USD/SEK 600 6 000 400 4 000 2020 2021 2022 2023 2024 List price (USD/tonne) Net price (USD/tonne) Source: F
Slide 5: Supply and demand
SUPPLY AND DEMAND Producers’ inventories and price USD/tonne Days of producers’ inventories 1 700 62 Producer stocks increasing 1 500 55 1 300 48 Oversupply of BHK 1 100 41 900 34 Good regional demand 700 27 500 20 2018 2019 2020 2021 2022 2023 2024 Days List price (USD/tonne) Net price (USD/tonne)
Slide 6: Containerboard production Europe
PRODUCTION EUROPE Compared to previous year 30% 2023 Jan - Jul 2024 Europe is Rottneros’ 20% main market 10% 0% Recovery after a weak -10% 2023 -20% -30% Newsprint Graphical paper Containerboard Other packaging Other Tissue Cartonboard Jan - Jul 2024 increase by 8% Source: CEPI
Slide 7: Deliveries of chemical market pulp
DELIVERIES OF CHEMICAL MARKET PULP Compared to previous year 2023 Jan - Aug 2024 30% Demand decreased 25% by -1,0% 20% 15% 10% 5% China’s share of 0% the pulp market is -5% approx. 40% -10% -15% -20% Europe North America Latin America China Other markets Source: PPPC
Slide 8: Rottneros' pulp-sales per application
Rottneros’ pulp-sales per application Sales of pulp 1-9 2024 (FY 2023) 3% 1% PRINTING AND FIBER CEMENT 3% (2) OTHER (3%) WRITING PAPER (2) CARTONBOARD 12% TISSUE (9%) 24% (29) 13% SPECIAL APPLICATIONS (12) 21% ELECTROTECHNICAL FILTER 23% APPLICATIONS (24) (20)
Slide 9: Result
Result Squeezed margins
Slide 10: EBIT Q3 2024 vs. Q3 2023
EBIT Q3 2024 VS. Q3 2023 (MSEK) 180 120 Higher sales price 160 140 120 Lower sales -52 volumes 100 80 -46 60 49 0 High raw material 40 -25 40 -5 and fixed costs 20 0 Q3 2023 Price and Volume, Variable Fixed Depreciation Other Q3 2024 currency change in costs costs inventories
Slide 11: EBIT 1-9 2024 vs. 1-9 2023
EBIT 1-9 2024 VS. 1-9 2023 (MSEK) 300 Lag in sales prices 250 239 200 -25 Lower sales -32 volumes 150 100 -75 74 -25 High variable costs 50 -6 -1 0 1-9 2023 Price and Volume, Variable Fixed Depreciation Other 1-9 2024 currency change in costs costs inventories
Slide 12: Stable wood supply in 2023
Stable wood supply in 2023 Share of the group’s variable costs (%) Wood Chemicals Electricity Fuel Others
Slide 13: Pulpwood prices on the rise
Pulpwood prices on the rise Prices in SEK/m3 by region and quality Source: Skogsstyrelsen/Danske Bank
Slide 14: Efficient and solid balance sheet
EFFICIENT AND SOLID BALANCE SHEET MSEK % Operational cash flow Net debt/cash Equity/asstes % 600 100 Available liquidity 500 90 258 MSEK 400 80 300 70 Investments 319 MSEK 200 60 100 50 0 40 Long-term financing -100 30 -200 20 -300 10 2020 Q2 Q3 Q4 2021 Q2 Q3 Q4 2022 Q2 Q3 Q4 2023 Q2 Q3 Q4 2024 Q2 Q
Slide 15: The way ahead
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Slide 16: Trends favoring pulp
Trends favoring pulp RENEWABLE TISSUE E-COMMERCE SUSTAINABILITY ENERGY
Slide 17: Global access to fiber
Global access to fiber Softwood has limited growth potential Nordics (2nd largest BSKP capacity region) Canada/BC • Lack of Russion pulp wood • Decreasing annual allowable cut • Bark beetle • Saw mill industry • Increasing competition from energy sector • Costs • Legislation reducing allowable cut •
Slide 18: Summary
SUMMERY Stabilized operations Finalizing investments Strong balance sheet
Slide 19: Questions and answers
Lennart Eberleh President and CEO Monica Pasanen CFO Questions and answers