Mayr Melnhof Karton : Annual Financial Report 2025

About this update from Mayr-melnhof Karton Ag

Fit-For-Future Annual Financial Report Mayr-Melnhof Karton AG 2025 Contents Management Report 2 Positioning of the MM Group and the Divisions 8 Development in the Year 2025 20 Research and Development 24 Risk Management 34 Disclosures according to Section 243 a Para. 1 of the Austrian Commercial Code 36 Consolidated Non-Financial Statement according to Section 267 a of the Austrian Commercial Code (Sustainability Statement) 167 Outlook 168 Consolidated Financial Statements 268 Management Report and Annual Financial Statements of Mayr-Melnhof Karton AG (German Version) 309 Consolidated Corporate Governance Report 318 Statement of the Management Board Management Report POSITIONING OF THE MM GROUP AND THE DIVISIONS 1) Group Leading in Consumer Packaging The MM Group (MM) is a global leader in consumer packaging. Its portfolio includes cartonboard and folding cartons as well as an attractive offer in kraft papers, uncoated fine papers, leaflets and labels. As a company with long-term orientation, MM promotes sustainable development through innovative and recyclable paper and packaging and products. Its business activities are managed in three divisions with independent profit responsibility. The MM Food & Premium Packaging division is a leading producer of folding cartons in Europe and maintains strong positions also in several markets outside Europe. It covers a wide range of sectors in the field of packaging for consumer goods. Business is conducted with large multinationals as well as local consumer goods producers. The MM Pharma & Healthcare Packaging division is a market leader for secondary pharma packaging in Europe and North America. With an attractive position in GLP-1 analogues, its global production network supplies leading pharma companies worldwide with folding cartons, leaflets and labels. The MM Board & Paper division is a leading European cartonboard producer (excl. liquid packaging cartonboard) with an attractive position in kraft papers and uncoated fine papers. The portfolio of fibre-based, sustainable and innovative packaging solutions has been continuously expanded in recent years. Extensive investments have improved quality, environmental performance and production efficiency. In 2025, around 15 % of its cartonboard production was supplied to the two Packaging divisions, whilst the majority was sold externally. The main reasons for this are the lower total purchases of the two Packaging divisions, direct cartonboard purchases by consumer goods producers (direct deals), MM's limited range of speciality cartonboard grades, and geographical positioning. Overall, the Packaging divisions bought 33 % of the cartonboard tonnage processed internally from MM Board & Paper. Circular economy an integral part of our business Demand for cartonboard packaging is closely linked to private consumption. Cartonboard is the key raw material for folding carton packaging, one of the most important and, at the same time, most sustainable primary packaging material for daily consumer goods. It provides protection, brand visibility and, compared to alternative materials, particularly resource-efficient value creation from renewable and repeatedly recyclable fibre materials. A responsible circular economy is thus firmly embedded in the MM Group's business. Global presence with focus on Europe Due to transport and service-related requirements, packaging production is mainly regionally organised. In addition to the production focus in Europe, MM is present in North and South America as well as in parts of Asia. We also hold a leading market position in the US, particularly in the Pharma & Healthcare sector. Cartonboard and paper products are supplied to over 100 countries worldwide, with a particular focus on Europe. The aim is to further strengthen sales outside Europe as well. Our kraft papers are used in the food 1) This chapter covers the contents of ESRS 2.40 and gastronomy industry as well as in the laminate industry, whilst uncoated fine papers are sold especially to European paper and office supply retailers. Fit-For-Future with focus on efficiency, sustainability and innovation The strategic focus of the MM Group is based on efficiency, sustainability and innovation. In recent years, MM has implemented extensive transformation and investment programmes aimed at technological modernisation and capacity optimisation. Smaller machines were decommisioned, structures were continuously adapted to market needs and central group functions as well as the use of state-of-the-art technologies have been specifically further developed. Since entering the pharma packaging business at the end of 2022, a new growth area with an attractive position in the field of GLP-1-analogues has been opened up. In 2025, MM has once again received the "triple A" rating from the environmental organisation CDP for its leading transparency and performance in Climate Change, Forests and Water Security, placing it among Europe's top companies. Its carbon footprint has been further improved, the number of occupational accidents has been reduced once again. Despite challenging market conditions, MM is solidly positioned as an European market leader. A well-in-vested asset base, combined with a consistent focus on cost, technology and innovation leadership, provide the foundation for sustainable competitiveness. Increasing this and profitability in a sustainable and structural manner is the aim of the Group-wide Fit-For-Future programme, which was launched Group-wide in 2025. MM Food & Premium Packaging A leading global folding carton producer MM Food & Premium Packaging is a world-leading manufacturer of folding cartons. With 29 sites across Europe, America and Asia, we have a geographically well-positioned production network from which we supply our customers competitively and with a high level of supply reliability. Since folding carton packaging has a limited delivery radius due to transport and service requirements, it is generally considered a regional product. The division supplies the food sector as well as premium & speciality segments, and the beauty & personal care sector. In 2025, 5,742 employees generated sales of around EUR 1.5 billion. The main market is Europe. Our aim is to supply our customers consistently with high quality from geographically well-positioned, highly competitive production sites. Therefore, we use the latest pre-print, print and finishing technologies to ensure the highest standards. As part of our focus on our core business, we have successfully completed the sale of the TANN Group, a leading global manufacturer of tipping paper. The production of folding cartons involves several process steps: printing on cartonboard, die-cutting, creasing and cutting into blanks, followed by folding, gluing and finishing according to the requirements of the respective customer industries. The boxes are shipped in a folded state to save space, and filling is predominantly carried out by customers at their own packaging lines. In addition to its core business, the division manufactures shaped boxes, microflute and paper-based packaging for highly customised, fibre-based and more sustainable solutions. Corrugated cartonboard production is a separate industry sector with specific products and markets, and plays a minor role within the division. There is an overlap in the area of consumer goods packaging made of fine flute (micro-flute), which is produced at specialised sites. These products combine the high stability of corrugated cartonboard with the excellent printability of coated board. Wide industry coverage and customer-oriented specialisation MM Food & Premium Packaging covers a wide range of industries with packaging solutions for everyday consumer goods. The market segment Food accounts for approx. 47 % of sales and Premium & Specialities for approx. 53 %. The latter includes, among others, home care, personal care, beauty, cigarette, luxury, ecommerce and electronics. The organisation in specialised business units allows for precise alignment with different market and product requirements and ensures an efficiently managed value-added process. Around 88 % of revenue is generated with multinational groups, with supplies typically arranged through multi-year agreements following upstream tendering processes. The remaining part of sales goes to local customers. In total, MM Food & Premium Packaging currently supplies around 1,100 customers worldwide. Cartonboard - a key raw material for the production of folding cartons Cartonboard is the most essential raw material and cost factor for the production of folding cartons. Its selection depends on functional packaging requirements and the specific needs of different consumer goods sectors. The procurement of recycled and virgin fibre-based cartonboard and paper is carried out by a central purchase organisation. With international consumer goods manufacturers, the purchase of cartonboard is often decided or negotiated directly by the customer ("direct deals"). Price changes for cartonboard are generally taken into account in sales price formation through contractual clauses referencing benchmark values. In addition to cartonboard and paper, inks, varnishes and tools are among the most important input factors in packaging production. The personnel intensity is significantly higher in packaging than in cardboard production. Strengthened competitiveness In recent years, we have made targeted investments in expanding our production capacity, as well as in modernising our machinery and ensuring its future-oriented geographical focus. These measures have further strengthened our operational capabilities and created additional growth opportunities for our customers. Sustainable and innovative for further growth Sustainability is a top priority for us. Accordingly, we are constantly working on innovative solutions to reduce our carbon footprint. We already use photovoltaic systems at several sites and are thereby continuously increasing the proportion of renewable energy. We also support our customers with space-saving packaging that reduces material usage and transport volumes. We place a particular emphasis on alternatives to plastic packaging - such as innovative systems like "Carton Cavity", which replaces plastic trays with cartonboard inserts, or "GreenPeel". These solutions follow the clear trend towards fibre-based, recyclable packaging and contribute to meeting regulatory requirements. MM Food & Premium Packaging is committed to long-term organic growth and selective acquisitions. The focus lies on continuously enhancing our competitiveness and innovative strength, as well as targeting attractive future markets. Supported by the Group-wide Fit-For-Future programme, rising productivity and consistently customer-focused, innovative solutions, the objective is to secure a solid level of profitability for the future as well. MM Pharma & Healthcare Packaging Leading in pharma secondary packaging MM Pharma & Healthcare Packaging is a leading supplier of pharma secondary packaging in Europe and the USA, offering a comprehensive product range. This includes folding cartons, leaflets and labels, which ensure a safe and reliable supply of medicines to patients. The division has a global production network of 24 sites across 9 countries and supplies over 600 customers, including the world's largest pharma companies and numerous CMOs (Contract Manufacturing Organisations). In 2025, the division generated sales of around EUR 0.6 billion with 3,473 employees. Location network with attractive potential The division mainly consists of the company groups Essentra Packaging (Europe and USA) and Eson Pac (Scandinavia) acquired in 2022, as well as Packetis (France), which was already acquired in 2015. As part of a comprehensive transformation process, the organisation, operational efficiency and financial performance have been considerably improved. Extensive investments and an intensive transfer of know-how from MM have contributed to the creation of a well-integrated, global production network that specifically aligned with the high regulatory and operational requirements of pharma packaging. Focus on high performance, innovation and sustainability Customers in the pharma industry expect the highest levels of delivery reliability, quality and flexibility. MM Pharma & Healthcare Packaging is well positioned to meet these requirements: a scalable, globally integrated production network, combined with the benefits of MM Board & Paper's virgin fibre-based cartonboard for pharmaceutical applications, ensure a consistently reliable and efficient supply. In addition, we offer tailored services - from the optimisation of packaging lines and process analyses to the improvement of supply chain processes. As market leader, we consistently align our value proposition with the highest technological standards and sustainable solutions. Our focus lies on areas of key importance to pharma companies: patient safety, sustainability, counterfeit-proofing, as well as smart packaging concepts that minimise the use of plastic. Our innovations combine technical feasibility with economic viability. We address a range of key requirements through "smart packaging", such as inventory and supply chain management, sustainability, product integrity and consumer interaction. This involves the use of various technological modules, such as RFID and NFC labels, e-fingerprints, QR codes or digital watermarks, which can be flexibly combined depending on the application. Another key area of value addition is support for clinical studies. Through specialised packaging solutions, we ensure quality, consistency and efficiency all over the entire study process. In our know-how workshops, we also provide practical expertise on folding cartons, leaflets and labels to help customers solve problems in their packaging lines and optimise the entire secondary packaging supply chain. Strategic focus on growth and increasing earnings The division sees promising growth opportunities, particularly driven by the dynamic development in the field of GLP-1 therapies for obesity and diabetes, as well as by a rising demand in the oncology, medical devices and eye care segments. With the comprehensive investments made in recent years and the successfully integrated global production network, MM Pharma & Healthcare Packaging is well positioned to further expand its leading position in Europe and North America and reliably meet the growing demand for highly specialised pharma secondary packaging. The division also benefits from the Group-wide Fit-For-Future programme, which leverages structural efficiency potential and thereby supports a sustainable earnings improvement. MM Board & Paper Leading cartonboard producer with an attractive offer in kraft papers and uncoated fine papers MM Board & Paper is a leading European cartonboard producer for the packaging industry (excl. liquid packaging cartonboard). The comprehensive fibre-based product portfolio includes various types of cartonboard and paper as well as pulp and is manufactured at seven production locations in Europe. In the financial year 2025, the division generated sales of around EUR 1.9 billion with 4,132 employees. The production mix comprised 56 % cartonboard, 16 % paper and 28 % pulp. Recycled fibres, which are purchased from external suppliers, account for around 53 % of the fibres used per year. Another 18 % consist of mechanical pulp, most of is largely produced by ourselves at our cartonboard mills and in the fibre mill FollaCell in Norway. Pulp, which accounts for 29 % of the fibre demand, is produced to 88 % internally, while 12 % is purchased externally. A wide range of applications - multi-mill concept ensures supply Our cartonboard products are used in numerous consumer goods markets for every day consumer goods. The focus lies on Food, Premium & Specialities (Beauty & Personal Care, etc.) as well as Pharma & Healthcare. Kraft papers are supplied in particular to the food and gastronomy industry and the laminate industry, whilst uncoated fine papers are mainly in demand from paper and office supply retailers. The NSBK pulp (Northern Bleached Softwood Kraft) produced in the Polish mill MM Kwidzyn is largely used internally but is also sold on the international market. MM Board & Paper's sales organisation is oriented towards meeting the individual requirements of each market segment with a high level of technical expertise. A key element is the multi-mill concept, whereby certain cartonboard qualities are produced at several plants in parallel. This guarantees high delivery reliability, consistent quality and short delivery times. The main market of MM Board & Paper is Europe, where around 85 % of the sales volume was sold in 2025. In addition, a worldwide sales network strengthens the international presence, most recently expanded with a sales office in the USA. In total, MM Board & Paper supplies more than 1,800 customers in around 100 countries, primarily medium-sized folding carton manufacturers, consumer goods producers and the aforementioned customers in the paper sector. Focus on efficiency, sustainability, quality and innovation Since the latest comprehensive investment programme, which focuses on increased cost efficiency, improved product quality and sustainability, a wide range of measures to implement best practices has been driven forward Group-wide in order to secure sustainable leadership in costs, technology and innovation. Currently, the Fit-For-Future programme is at the centre of attention, from which the division has already benefited substantially. Alongside realising cost-saving potential, a significant focus lies on exploiting new market opportunities. High-performance asset base MM is continuously optimising production and has consistently aligned the product portfolio with market demands. Our cartonboard and paper products are currently produced on seven high-performance cartonboard machines and three paper machines at six mills. Each of the machines is clearly adapted to specific product qualities: three to recycled fibre-based cartonboard, two to virgin fibre-based cartonboard, one to white coated recycling liner and another can flexibly produce both recycled and virgin fibre-based cartonboard grades. In addition, two paper machines produce uncoated fine papers and packaging kraft papers, while another machine produces saturating kraft paper. The machines and mills are continuously kept up at the state of the art with a clear focus on optimally leveraging growth and efficiency potential. Future-oriented fibre-based solutions Cartonboard and paper are the preferred packaging materials among consumers. Therefore, MM Board & Paper's aim is to create new possibilities for the substitution of plastic packaging with environmentally friendly and innovative solutions made of cartonboard and paper. To accomplish this, we are continuously optimising existing products and develop, for example, innovative barrier concepts to facilitate the use of cartonboard as an alternative packaging material for a wide range of food products including liquid, chilled, frozen and greasy food. Although the impact of the trend towards plastic substitution on our cartonboard and paper sales remains difficult to quantify, nevertheless, our aim is to capitalise on this market trend in a targeted manner. Fibres and energy central cost factors Recovered paper is a strategic raw material for the production of coated recycled fibre-based cartonboard, whilst mechanical pulp is primarily used for virgin fibre-based cartonboard and pulp for kraft and fine papers. In addition, wood is used for pulp production. Energy, chemicals and logistics are other significant cost factors. The high-quality printability of cartonboard is reached through the application of a special coating made from chalk, fillers and binders to the outer surface of cartonboard. MM Board & Paper sources its recycled fibres entirely from Europe, predominantly on the spot market. Due to the structural decline in print media and office papers, recovered paper will become a scarcer raw material in the longer term, despite high recycling rates and existing reserves of supply. However, we consider the supply for our mills to be secured. The supply situation for wood, a raw material sourced from sustainable forestry, is also generally considered stable, although volumes and prices may be subject to significant fluctuations. In terms of energy use, MM Board & Paper relies largely on natural gas, but is continuously expanding the share of renewable energies such as biomass and photovoltaics. In addition, self-suffi-ciency is being gradually increased and greater attention is being paid to the procurement of raw materials with a reduced carbon footprint. Intense competition MM Board & Paper is the only European supplier that operates several large production sites for both recycled and virgin fibre-based cartonboard. In addition, the Company is the only European cartonboard producer with a significant additional pillar in folding carton production, whilst the largest Scandinavian suppliers focus exclusively on virgin fibre-based cartonboard. Capacity development in the recycled fibre-based cartonboard sector in Europe has been driven for decades by the continuous technological modernisation of existing plants ("creeping capacity increase"). In the virgin fibre-based cartonboard sector, the structural shift away from graphic papers towards cartonboard packaging has created significant additional capacity. At the same time, a clear trend towards large, highly efficient plants for sustainable packaging solutions is continuing. In particular the virgin fibre-based cartonboard sector has seen a furhter significant capacity expansion, which, combined with trade policy uncertainties, is leading to a further increase in competitive pressure. Against this backdrop, MM Board & Paper is consistently pursuing a strategic approach aimed at improving long-term profitability through cost management and structural measures. DEVELOPMENT IN THE YEAR 2025 General economic situation Economic development in Europe in 2025 was characterised by a slow and fragile recovery. Although inflation and energy prices declined and real incomes stabilised, private consumption remained subdued overall. Many households continued to act cautiously, increased their savings rates and responded sensitively to geopolitical risks as well as uncertainty in the labour and real estate markets. As a result, growth was primarily driven by government spending and selected export-oriented sectors, while industry and construction progressed only at a slow pace. In the United States, the picture was different: economic activity remained more robust, supported by a comparatively dynamic labour market and still resilient private consumption, even though its momentum weakened over the course of the year. Global trade overall showed muted development in 2025. Trade conflicts, protectionist tendencies and a greater regionalisa-tion of supply chains weighed on the international distribution of labour. Overall, the economic environment remained challenging, with limited growth momentum and high uncertainty. Industry development In 2025, the cartonboard and paper industry recorded its third consecutive year of an exceptionally prolonged market downturn. Structural overcapacity and subdued consumer demand in Europe resulted in low capacity utilisation and pressure on prices and margins. Additional headwinds stemmed from trade tariffs with the US and increasing import pressure from Asia. The packaging sector showed a more heterogeneous picture, with weak European demand for folding cartons for daily consumer goods and regionally varying dynamics in Pharma & Healthcare, characterised by strong growth in the US and weaker demand, for example, in Central and South-West Europe. Prices for essential raw materials showed a slight overall decline: recovered paper remained volatile with a downward trend towards year-end, pulp stabilised at a high level and wood prices exhibited moderate price movements. Energy prices eased compared with previous years but remained structurally elevated and continue to weigh on the competitiveness of European producers. Against this backdrop, numerous companies are focusing on programmes to enhance efficiency, reduce costs and undertake structural adjustments. However, consolidation in the cartonboard industry made only slow and insufficient progress overall in 2025. The supplier structure in the European folding carton sector remains highly fragmented. From today's perspective, no significant improvement in the market environment is foreseeable for 2026. The combination of weak demand, international competitive pressure, high structural costs and overcapacity suggests that consolidation pressure in the sector will persist, particularly in the cartonboard and paper sectors. Development of business 2025 Group In 2025 the MM Group demonstrated a solid performance in a challenging market environment characterised by ongoing soft consumer demand and overcapacity in the European industry and succeeded in increasing its adjusted operating profit compared to the previous year 1) . In the packaging sector, the Food & Premium Packaging division managed to keep its adjusted operating margin at a solid level, while the Pharma & Healthcare Packaging division recorded an encouraging increase. The Board & Paper division showed an improvement over the previous year, primarily driven by cost savings, even though the profit level remained unsatisfactory. Due to the imperative to structurally and sustainably strengthen profitability and competitiveness under ongoing challenging conditions, MM ramped up and accelerated its Group-wide Fit-For-Future transformation programme. By 2025, the programme had already contributed remarkable EUR 70 million to adjusted operating profit. Management is confident that it will achieve an earnings uplift of over EUR 250 million in 2027 compared to 2024, excl. TANN and market-related effects, subsequent to expecting an increase of over EUR 150 million at programme launch. One-off effects at the operating profit level amounted to a total of EUR 25.6 million in 2025 (2024: EUR 0 million). These include income from the sale of TANN Group of EUR 125.1 million, offset by an impairment requirement for assets at Board & Paper of EUR 70.5 million and expenses from Fit-For-Future restructurings of EUR 29.0 million. At EUR 77.0 million, the profit for the year was below the previous year's figure (EUR 110.5 million) as a result of significantly higher tax expense. In line with the revised dividend policy, which aims at a payout ratio of 40 % - 60 % of the profit for the year depending on net debt (net debt/equity 35 % - 55 %; net debt/adjusted EBITDA 1.5 - 2.5x), major planned investments, future prospects and the principle of dividend continuity, an 11 % increase in the dividend to EUR 2.00 per share (2024: EUR 1.80) will be proposed to the 32 nd Annual Shareholders' Meeting on April 29, 2026 for the financial year 2025. The Group's net debt could be reduced to EUR 913.7 million by the end of 2025 (December 31, 2024: EUR 1,078.7 million). Net debt to equity was 43 % and the net debt to adjusted EBITDA ratio was 2.2 (December 31, 2024: 51 %; 2.6). Regarding the non-financial performance, we are pleased to report an 11 % reduction in absolute CO 2 emis-sions 2) . The main reasons for this are the continued switch to renewable energy sources for electricity procurement and energy efficiency measures. The number of occupational accidents has been reduced once again. Looking ahead, Food & Premium Packaging continues to pursue focused development at a high level, despite persistently cautious consumer behaviour. Pharma & Healthcare Packaging is expected to continue growing, particularly in the United States, while individual markets in Europe stay more subdued. In the Board & Paper division, market-related margin pressure remains challenging, but at the same time provides a strong incentive for further efficiency and quality improvements. 1) The comparison with the reported previous year is limited due to the sale of the TANN Group; please therefore refer to the pro forma key indicators excl. TANN. 2) Scope 1 and Scope 2 market-based MM's objective remains to uphold its cost, technology and innovation leadership in its core business cartonboard packaging, even under ongoing challenging market conditions, through an attractive, sustainable offering and a determined transformation. Consolidated income statements Consolidated income statements (condensed version) Sales 3,885.3 4,079.6 Adjusted operating profit 1) 195.4 190.0 Financial result and result from investments (75.3) (75.7) Income tax expense (68.7) (3.8) Profit for the year 77.0 110.5 (in millions of EUR) 2025 2024 +/- - 4.8 % + 2.8 % n.m. n.m. - 30.3 % 1) Adjusted for material one-off effects. To enhance significance of the earnings figures in the divisions, management now defines "material" as impact of more than EUR 5 million on operating profit (previously more than EUR 10 million). At EUR 3,885.3 million, the Group's consolidated sales were below the previous year's figure (2024: EUR 4,079.6 million) by 4.8 % or EUR 194.3 million. The decline is mainly attributable to the sale of TANN Group at the beginning of June. In the geographical breakdown of sales, the share of the core market Europe remained unchanged at 78.2 % (2024: 78.2 %), while the share of the Americas increased slightly to 11.0 % (2024: 10.1 %). The share of the rest of the world declined to 10.8 % (2024: 11.7 %). Intercompany sales rose to EUR 201.6 million (2024: EUR 192.7 million) and were primarily related to deliveries from MM Board & Paper to the two Packaging divisions. Group sales by destination (in %) 2025 2024 Europe (excl. BLR, RUS, TUR) 78.2 % 78.2 % thereof Austria 1.9 % 2.1 % The Americas 11.0 % 10.1 % Rest of World 10.8 % 11.7 % Total 100.0 % 100.0 % Expenses Percentage of sales (in millions of EUR) 2025 2024 +/- 2025 2024 Cost of materials and purchased services 1,975.7 2,172.9 Personnel expenses 860.5 846.6 Other operating expenses 707.1 688.9 Depreciation and amortisation 219.7 228.0 Impairment and write-ups 76.3 0.5 - 9.1 % 50.8 % 53.3 % + 1.6 % 22.1 % 20.8 % + 2.6 % 18.2 % 16.9 % - 3.6 % 5.7 % 5.6 % n.m. 2.0 % 0.0 % Cost of materials and purchased services amounted to EUR 1,975.7 million, below the comparative figure of the previous year (2024: EUR 2,172.9 million). This decrease was primarily attributable to lower expenses for energy, paper and fibres. Accordingly, their share of sales declined to 50.8 % (2024: 53.3 %). Personnel expenses increased slightly to EUR 860.5 million (2024: EUR 846.6 million), with their share of sales rising from 20.8 % to 22.1 %. Other operating expenses amounted to EUR 707.1 million, compared with EUR 688.9 million in the previous year, resulting in an increase in their share of sales to 18.2 % (2024: 16.9 %). Depreciation and amortisation decreased from EUR 228.0 million in 2024 to EUR 219.7 million. Their share of sales amounted to 5.7 % (2024: 5.6 %). Expenses from impairment and write-ups increased significantly to EUR 76.3 million (2024: EUR 0.5 million), primarily due to value adjustments of EUR 70.3 million in the MM Board & Paper division. This resulted in a share of sales of 2.0 % (2024: 0.0 %). Material one-off effects on operating profit and EBITDA Operating profit EBITDA (in millions of EUR) 2025 2024 2025 2024 Reported profit in accordance with IFRS 221.0 190.0 517.0 418.5 Income from sale of TANN Group (MM Food & Premium Packaging) (125.1) - (125.1) - Impairment MM Kolicevo (MM Board & Paper) 70.5 - - - Fit-For-Future restructurings 29.0 - 26.3 - MM Pharma & Healthcare Packaging footprint optimisation 15.2 - 13.6 - Other Fit-For-Future restructuring expenses 13.8 - 12.7 - Total of material one-off effects (25.6) - (98.8) - Adjusted by material one-off effects 195.4 190.0 418.2 418.5 The rise in adjusted operating profit by 2.8 % to EUR 195.4 million - pro forma excl. TANN +15.0 % - (2024: EUR 190.0 million) was primarily attributable to the MM Board & Paper division. The Group's adjusted operating margin increased to 5.0 % (2024: 4.7 %) and the adjusted return on capital employed amounted to 5.8 % (2024: 5.6 %). Adjusted EBITDA totalled EUR 418.2 million (2024: EUR 418.5 million), resulting in an ad- justed EBITDA margin of 10.8 % (2024: 10.3 %). Financial income decreased to EUR 16.5 million (2024: EUR 27.1 million), mainly due to lower cash and interest rates. The decline in financial expenses from EUR -82.9 million to EUR -53.4 million is largely attributable to lower interest levels for variable-interest financing and further repayments. "Other financial result - net" changed to EUR -38.5 million (2024: EUR -19.9 million), mainly owing to currency translations. Profit before tax rose to EUR 145.7 million (2024: EUR 114.3 million), this increase primarily reflecting the TANN divestment. Income tax expense was up to EUR 68.7 million (2024: EUR 3.8 million), driven mainly by the reversal of loss carryforwards in the Board & Paper division, after loss carryforwards capitalised in the previous year - including those from former Essentra Packaging - had reduced the expense. This results in an effective Group tax rate of 47.2 % (2024: 3.4 %), with the Group's standard tax rate amounting to approximately 22.0 % (2024: 19.0 %). Profit for the year, earnings per share Profit for the year therefore reached EUR 77.0 million (2024: EUR 110.5 million), representing a net profit margin of 2.0 % (2024: 2.7 %). In the 2025 financial year, taking the share repurchase programme into account, a simple weighted average of 19,602,607 shares (2024: 20,000,000) was outstanding. Based on this, earnings per share amounted to EUR 3.86 (2024: EUR 5.41), calculated on the basis of net profit attributable to shareholders of the Company of EUR 75.6 million (2024: EUR 108.2 million). Assets, capital, and liquid funds Consolidated balance sheets (condensed version) (in millions of EUR) Dec. 31, 2025 Dec. 31, 2024 Non-current assets 2,942.9 3,013.2 Current assets 1,534.9 1,849.9 Total assets 4,477.8 4,863.1 Total equity 2,103.6 2,128.7 Non-current liabilities 1,403.7 1,660.7 Current liabilities 970.5 1,073.7 Total equity and liabilities 4,477.8 4,863.1 The Group's total assets of EUR 4,477.8 million as of December 31, 2025 were EUR 385.3 million below the figure at year-end 2024 (EUR 4,863.1 million). The Group's total equity decreased from EUR 2,128.7 million (December 31, 2024) to EUR 2,103.6 million, with the profit for the year being offset primarily by the dividend payment for 2024, the repurchase of own shares and currency translation. The equity ratio increased to 47.0 % (December 31, 2024: 43.8 %). Return on equity was 3.6 % after 5.3 % in the previous year. Non-current assets amounting to EUR 2,942.9 million were below the previous year's level (EUR 3,013.2 million), largely attributable to depreciation and currency translation. Current assets decreased from EUR 1,849.9 million to EUR 1,534.9 million, primarily resulting from the sale of TANN. Financial liabilities, mainly of a long-term character, decreased from EUR 1,631.1 million 1) at year-end 2024 to EUR 1,412.1 million as of December 31, 2025 due to repayments. Furthermore, credit lines and credit facilities which can be used at any time were available to the Group at year-end 2025 in the amount of EUR 351.3 million (December 31, 2024: EUR 361.0 million). With cash available to the Group totalling EUR 498.4 million (December 31, 2024: EUR 552.4 million 2) ), net debt decreased to EUR 913.7 million (December 31, 2024: EUR 1,078.7 million). 1) Balance sheet value of EUR 1,628.7 million as of December 31, 2024 after reclassification of the TANN Group's financial liabilities to other liabilities from "assets held for sale" 2) Balance sheet value of EUR 520.9 million as of December 31, 2024 after reclassification of the TANN Group's cash to "assets held for sale" Cash flow development Consolidated cash flow statements (condensed version) (in millions of EUR) 2025 2024 Net cash from operating activities 231.1 516.3 Net cash from investing activities 125.5 (188.7) Net cash from financing activities (376.6) (520.6) Effect of exchange rate changes (34.0) (12.1) Net change in cash and cash equivalents (< 3 months) (54.0) (205.1) Cash and cash equivalents (< 3 months) at the end of the year 498.4 552.4 Less cash and cash equivalents recognised as assets according to IFRS 5 0.0 (31.5) Cash and cash equivalents (< 3 months) at the end of the year (in the consolidated balance sheet) 498.4 520.9 Cash flow from operating activities changed to EUR 231.1 million, which was EUR 285.2 million below the comparative figure for the previous year (2024: EUR 516.3 million). This decline was mainly attributable to a build-up of working capital. In parallel, free cash flow declined from EUR 302.2 million to EUR 11.1 million. Cash flow from investing activities amounted to EUR 125.5 million, compared to EUR -188.7 million in the prior year. This development was primarily driven by proceeds of EUR 343.3 million from the sale of the TANN Group. Cash outflows for the acquisition of property, plant and equipment as well as intangible assets totalled EUR 232.7 million, following EUR 220.9 million in the previous year. Capital expenditure at MM Food & Premium Packaging amounted to EUR 68.1 million (2024: EUR 58.3 million) and focused on technological modernisations at selected sites. Capital expenditure at MM Pharma & Healthcare Packaging totalled EUR 44.2 million (2024: EUR 55.8 million), with focal points on the renewal and expansion of machinery and equipment. Capital expenditure at MM Board & Paper amounted to EUR 123.1 million (2024: EUR 106.8 million), primarily relating to a continuous pulp digester in Kwidzyn, Poland, as well as technological upgrades at the other mills. Cash flow from financing activities changed, due to repayments, from EUR -520.6 million to EUR -376.6 million. In 2025, lower repayment amounts were offset by cash outflows for the buyback of treasury shares. Pro forma Group Key Indicators (Excl. TANN Group) Consolidated sales 3,796.6 3,866.0 Adjusted EBITDA 1) 395.4 366.5 Adjusted EBITDA margin (%) 10.4 % 9.5 % Adjusted operating profit 1) 172.5 150.1 Adjusted operating margin (%) 4.5 % 3.9 % Adjusted return on capital employed (%) 5.3 % 4.7 % Operating profit 73.1 150.1 Cash flow from operating activities 238.9 462.9 Free cash flow 22.5 255.7 Capital expenditures 229.0 214.0 Depreciation and amortization 219.7 228.0 Wertminderungen und Zuschreibungen 76.3 0.5 (consolidated, in millions of EUR) 2025 2024 +/- - 1.8 % + 7.9 % + 93 bp + 15.0 % + 66 bp + 53 bp - 51.3 % - 48.4 % - 91.2 % + 7.0 % - 3.6 % n.m. 1) Adjusted for material one-off effects. To enhance significance of the earnings figures in the divisions, management now defines "material" as impact of more than EUR 5 million on operating profit (previously more than EUR 10 million). Further information Share repurchase programme The share repurchase programme conducted between 3 January and 23 December 2025 was completed as planned. In total, 569,019 treasury shares were acquired at a total consideration of EUR 41,227,104.20, corresponding to an average purchase price of EUR 72.45 per share. Details of the transactions are published on the Company's website at https://www.mm.group/en/investors/share . Definition of financial indicators Adjusted EBITDA margin/operating margin Adjusted EBITDA/adjusted operating profit divided by sales. Adjusted operating profit/adjusted EBITDA Operating profit/EBITDA adjusted for material one-off effects (material defined as impact on operating profit of more than EUR 5 million). EBITDA (Earnings before interest, income taxes, depreciation and amortisation) Operating profit plus depreciation, amortisation, impairment and write-ups of property, plant and equipment and intangible assets as well as non-current assets held for sale. Capital expenditures Capital expenditures include additions to property, plant and equipment and intangible assets (adjusted for non-cash additions, e.g. from leases or capitalised borrowing costs) less received government grants and in addition include payments on account as well as the change in liabilities from investment activities. Capital expenditures are derived from the consolidated cash flow statement. Employees Employees at the end of the year, incl. apprentices and part-time employees on a pro-rata basis. Equity ratio Total equity divided by total assets. Free cash flow Cash flow from operating activities plus proceeds from disposals of property, plant and equipment and intangible assets as well as government grants less payments for acquisition of property, plant and equipment and intangible assets (incl. payments on account). Net debt/adjusted EBITDA Net debt/net liquidity divided by adjusted EBITDA. Net debt/equity Net debt/net liquidity divided by equity at year-end. Net debt/net liquidity The sum of current and non-current interest-bearing financial liabilities including lease liabilities according to IFRS 16 as well as factoring liabilities less cash and cash equivalents. In case the sum of cash and cash equivalents exceeds financial liabilities, there is net liquidity. In the event of reclassification of these balance sheet items as "available for sale" in accordance with IFRS 5, net debt/net liquidity is adjusted. The calculation is based on the assumption that the reclassified balance sheet items continue to be part of cash and cash equivalents and financial liabilities. Net profit margin Profit for the year divided by sales. Return on capital employed (ROCE) Adjusted operating profit divided by the sum of average total equity, average current and non-current interest-bearing financial liabilities, incl. lease liabilities according to IFRS 16 as well as factoring liabilities, less average cash and cash equivalents. Return on equity (ROE) Profit for the year divided by average total equity. All indicators were calculated exclusively on the basis of the information provided in the consolidated financial statements. Business development in the divisions MM Food & Premium Packaging Against the backdrop of declining sales in numerous end markets, 2025 was characterised by ongoing soft demand for folding cartons in Europe. This led to increasingly intense competition and pressure on margins. In this market environment, MM Food & Premium Packaging pursues a comprehensive set of measures to safeguard long-term profitability and maintain or further expand its existing market shares. In addition to necessary efficiency improvements, the site in Romania, for example, is undergoing technological expansion to allow for onboarding new business in the future in a flexible and highly efficient manner. In contrast, the Superpak Karaman site in Turkey was closed, and business was concentrated at the two remaining Turkish plants. As part of sharpening the focus on our core business, the divestment of TANN Group, a leading global manufacturer of tipping paper, was successfully completed on June 2, 2025. In this context, a one-off income of around EUR 125.1 million was recognised. In addition, further measures to focus the portfolio were taken by selling the smaller sites in Bangor, United Kingdom, and Leeuwarden, Netherlands. Overall, we were able to safeguard a good margin quality in 2025 despite declining volumes. Divisional indicators MM Food & Premium Packaging (in millions of EUR) 2025 2024 +/- Sales 1) 1,538.4 1,702.4 - 9.6 % Adjusted EBITDA 2) 228.2 258.3 - 11.6 % Adjusted operating profit 2) 157.3 179.4 - 12.3 % Adjusted operating margin (%) 10.2 % 10.5 % - 31 bp Adjusted return on capital employed (%) 15.4 % 15.6 % 3) - 13 bp Operating profit 276.7 179.4 + 54.2 % Cash flow from operating activities 119.7 321.2 - 62.7 % Free cash flow 58.2 264.9 - 78.0 % Capital expenditures 68.1 58.3 + 16.7 % Capital employed 1,018.8 1,152.2 3) - 11.6 % Produced volume (in millions of m 2 ) 2,541 3,103 - 18.1 % 1) incl. interdivisional sales 2) Adjusted for material one-off effects. To enhance significance of the earnings figures in the divisions, management now defines "material" as impact of more than EUR 5 million on operating profit (previously more than EUR 10 million). 3) incl. cash and financial liabilities of TANN Group As the comparison with the reported previous year is limited due to the sale of TANN Group, a comparison of the pro forma key indicators excl. TANN is also provided: MM Food & Premium once again achieved a solid adjusted operating margin of 10.2 % (2024: 10.5 %). Adjusted operating profit amounted to EUR 157.3 million after EUR 179.4 million in the previous year. Adjusted return on capital employed remained at a good level of 15.4 % (2024: 15.6 %). Cash flow from operating activities was at EUR 119.7 million (2024: EUR 321.2 million), while capital expenditures totalled EUR 68.1 million, compared to EUR 58.3 million in the previous year. At EUR 1,538.4 million, sales were below the previous year (2024: EUR 1,702.4 million), mainly as a result of the TANN divestment. 74 % were accounted for by Europe, 7 % by the Americas and 19 % by the rest of the world (2024: 71 %; 8 %; 21 %). MM Food & Premium Packaging supplies around 1,100 customers in various consumer goods industries. The main markets are Food as well as Premium, the latter including the submarkets Home Care, Personal Care, Beauty, Cigarette, Luxury, E-Commerce and Electronics. As a result of a high concentration in the customer industries, a significant share of business is accounted for by multinational key accounts. In 2025, around 40 % (2024: 39 %) of sales were generated with the five largest customers. Excluding TANN Group, the adjusted operating margin was 9.3 % (2024: 9.4 %). Adjusted operating profit totalled EUR 134.5 million after EUR 139.4 million in the previous year. The adjusted return on capital employed was 14.3 % (2024: 14.8 %), cash flow from operating activities amounted to EUR 127.5 million (2024: EUR 267.7 million). Capital expenditures moved up to EUR 64.4 million after EUR 51.4 million. At EUR 1,449.7 million, sales were below the previous year (2024: EUR 1,488.7 million), mainly due to volume. The volume produced excl. TANN at 2,172 million m 2 (2024: 2,240 million m 2 ) was 3.0 % below the previous year. Pro forma divisional indicators MM Food & Premium Packaging excl. TANN Group Sales 1) 1,449.7 1,488.7 Adjusted EBITDA 2) 205.4 206.2 Adjusted operating profit 2) 134.5 139.4 Adjusted operating margin (%) 9.3 % 9.4 % Adjusted return on capital employed (%) 14.3 % 14.8 % Operating profit 128.8 139.4 Cash flow from operating activities 127.4 267.8 Free cash flow 69.6 218.4 Capital expenditures 64.4 51.4 Capital employed 937.4 943.4 Produced volume (in millions of m 2 ) 2,172 2,240 (in millions of EUR) 2025 2024 +/- - 2.6 % - 0.4 % - 3.5 % 9 bp 43 bp - 7.6 % - 52.4 % - 68.2 % + 25.2 % - 0.6 % - 3.0 % 1) incl. interdivisional sales 2) Adjusted for material one-off effects. To enhance significance of the earnings figures in the divisions, management now defines "material" as impact of more than EUR 5 million on operating profit (previously more than EUR 10 million). MM Pharma & Healthcare Packaging Demand and order intake in Pharma & Healthcare showed a rather heterogeneous development in the course of 2025. While we are seeing solid growth in the United States, individual markets in Western and Central Europe remain marked by weakness due to intense competition and strong margin pressure. Despite the lack of volume growth so far, the division was able to stabilise its performance through targeted productivity increases and efficiency measures and to improve its operating profitability. Both adjusted operating profit and margins increased significantly compared to the previous year. As part of its strategic growth orientation, MM Pharma & Healthcare Packaging focuses on consistent operational excellence, the development of innovative and more sustainable packaging solutions, and first-class customer service. Targeted site optimisations in France and Spain support the improvement of op- erational performance in 2025 and strengthen competitiveness in a still challenging regional market environment. In addition, numerous growth initiatives are being driven forward and successfully implemented together with customers. Divisional indicators MM Pharma & Healthcare Packaging (in millions of EUR) 2025 2024 +/- Sales 1) 618.3 615.7 + 0.4 % Adjusted EBITDA 2) 77.7 69.9 + 11.2 % Adjusted operating profit 2) 37.2 29.8 + 24.9 % Adjusted operating margin (%) 6.0 % 4.8 % + 118 bp Adjusted return on capital employed (%) 8.3 % 7.0 % + 124 bp Operating profit 17.4 29.8 - 41.6 % Cash flow from operating activities 53.9 71.9 - 25.1 % Free cash flow 14.1 19.7 - 28.3 % Capital expenditures 44.2 55.8 - 20.8 % Capital employed 449.9 423.4 + 6.3 % Produced volume (in millions of m 2 ) 897 918 - 2.2 % 1) incl. interdivisional sales 2) Adjusted for material one-off effects. To enhance significance of the earnings figures in the divisions, management now defines "material" as impact of more than EUR 5 million on operating profit (previously more than EUR 10 million). The adjusted operating margin rose from 4.8 % to a good 6.0 %. Adjusted operating profit improved by 24.9 % from EUR 29.8 million to EUR 37.2 million. The adjusted return on capital employed increased to 8.3 % (2024: 7.0 %), while cash flow from operating activities changed to EUR 53.9 million (2024: EUR 71.9 million). At EUR 44.2 million, capital expenditures were below the previous year's figure of EUR 55.8 million. Sales of EUR 618.3 million remained stable to the previous year (2024: EUR 615.7 million). Thereof, Europe accounted for 61 %, the Americas for 38 % and the rest of the world for 1 % (2024: 62 %, 37 %, 1 %). MM Pharma & Healthcare Packaging supplies around 650 customers, with the five largest customers accounting for around 31 % (2024: 29 %) of sales. At 897 million m 2 , the volume produced was 2.2 % below last year's figure of 918 million m 2 , mainly due to restructuring measures. MM Board & Paper After moving sideways until the 2 nd quarter, cartonboard markets came under increasing pressure as the year progressed. In addition, the market for uncoated fine paper had already been in sharp decline since the beginning of the year. In virgin fibre-based cartonboard, additional European capacity and the return of U.S. export volumes to Europe as well as rising import pressure from Asia continue to intensify volume pressure. In contrast, the environment for recycled fibre-based cartonboard remained relatively stable. However, Board & Paper was able to significantly mitigate these negative market developments through substantial cost savings and efficiency improvements. At 3,138,000 tonnes, volume produced remained close to the previous year's level (2024: 3,145,000 tonnes). The division's average order backlog amounted to 160,000 tonnes (2024: 172,000 tonnes). Recovered paper experienced a significant price spike in the 2 nd quarter, followed by a trend reversal which started in July and continued until the end of the year. Energy costs were below the previous year's level. Divisional indicators MM Board & Paper (in millions of EUR) 2025 2024 +/- Sales 1) 1,930.2 1,954.3 - 1.2 % Adjusted EBITDA 2) 115.0 90.3 + 27.2 % Adjusted operating profit 2) 3.4 (19.2) n.m. Adjusted operating margin (%) 0.2 % -1.0 % + 116 bp Adjusted return on capital employed (%) 0.2 % -1.1 % + 124 bp Operating profit (70.5) (19.2) n.m. Cash flow from operating activities 57.5 123.2 - 53.4 % Free cash flow (61.2) 17.6 n.m. Capital expenditures 123.1 106.8 + 15.2 % Capital employed 1,888.7 1,801.3 + 4.9 % Tonnage produced (in thousands of tonnes) 3,138 3,145 - 0.2 % Cartonboard 3) 1,758 1,763 - 0.3 % Paper 505 497 + 1.6 % Pulp 4) 875 885 - 1.1 % Market pulp 126 119 + 6.3 % Internal pulp 749 766 - 2.2 % 1) including interdivisional sales 2) Adjusted for material one-off effects. To enhance significance of the earnings figures in the divisions, management now defines "material" as impact of more than EUR 5 million on operating profit (previously more than EUR 10 million). 3) including coated liner 4) Chemical pulp and CTMP The annual review of asset valuations resulted in a non-cash impairment requirement for assets of the MM Board & Paper division, which was recognised as an impairment loss of EUR 70.5 million. Adjusted operating profit and adjusted operating margin improved to EUR 3.4 million and 0.2 % (2024: EUR -19.2 million and -1.0 %) as a result of significant cost savings. Annual maintenance standstills, which mainly affect the two cartonboard and paper mills in Poland and Finland, resulted in expenses of EUR 36 million (2024: EUR 26 million), with approximately two thirds occurring in the 3 rd quarter and approximately one third in the 4 th quarter. The adjusted return on capital employed amounted to 0.2 % (2024: -1.1 %), cash flow from operating activities to EUR 57.5 million (2024: EUR 123.2 million). Capital expenditures totalled EUR 123.1 million (2024: EUR 106.8 million). At EUR 1,930.2 million, sales were price-related only 1.2 % below last year's level (2024: EUR 1,954.3 million). Similar to the previous year, 90 % thereof were generated in Europe, 4 % in the Americas and 6 % in the rest of the world (2024: 91 %, 3 %, 6 %). The two Packaging divisions have again been MM Board & Paper's largest customer with a combined share of deliveries of around 15 % or 265,000 tonnes of cartonboard (2024: 15 % or 265,000 tonnes). Continuation of decarbonisation At MM Kwidzyn, investment in a continuous pulp digester will accelerate the path to further decarbonisation. Once completed towards the end of 2026, the installation is expected to reduce the mill's CO 2 emissions by around a third and further increase the share of renewable energy. In Kotka, investment in two electric boilers will significantly reduce CO 2 emissions. Installation is planned for spring 2027. RESEARCH AND DEVELOPMENT The research and development activities of the MM Group are aimed at strengthening the Group's competitiveness and growth potential over the long term through innovative and sustainable solutions. Our aspiration is to identify market and future trends at an early stage and to proactively implement solutions that create lasting value for both our customers and the Group. To this end, we continually invest in the future and leverage a broad network both within and outside the organisation. In 2025, expenses for research and development activities amounted to EUR 6.5 million (2024: EUR 12.5 million). Our innovation performance is based on the ongoing optimisation of existing products and processes, as well as on the rapid implementation of new solutions arising from changing framework conditions. At the same time, we seek to open up new fields of application and business areas. Across all development activities, ecological impacts as well as potential risks are consistently taken into account. Modern innovation process Building on our long-standing experience in the development of innovative products and our know-how in efficient innovation processes, we consistently pursue the achievement of our growth and sustainability objectives. A responsible use of raw materials, as well as the willingness to critically challenge existing solutions, forms a pillar of our approach. All product development activities at MM follow a clearly defined and continuously refined process, ranging from the generation of initial ideas through evaluation and technical product development to market launch. The expertise of our specialist departments is incorporated at every stage of this process. We are convinced that innovation primarily arises from the diversity and interconnectedness of different competences within the Group. Openness to new ideas and active dialogue are therefore key elements of our innovation culture. Consequently, customers, suppliers, end consumers and research partners are involved in the innovation process at an early stage. This exchange enables a holistic assessment of challenges and requirements with regard to technological performance, quality, safety and sustainability. New insights and solutions can thus be directly integrated into product development, consistently with a clear focus on meeting customer needs. Our research activities focus on the development of innovative packaging concepts, particularly for food, pharmaceutical, personal care, beauty, as well as for high-quality premium packaging. In parallel, we evaluate new technologies in order to further advance future cartonboard and paper solutions in a targeted manner. To ensure the highest levels of quality and product safety, we rely on recognised external certifications. These provide assurance to our customers and end users that our product innovations are sustainable, socially responsible and safe for health, while fully complying with all regulatory requirements. In 2025, we consistently continued our cooperation with external partners such as universities and research institutions. Within the Packaging divisions, the focus was on barrier technologies, machinery technologies, as well as sustainable finishing solutions, including in particular integrated anti-counterfeiting systems. In the MM Board & Paper division, activities centred on application-oriented basic research into wood fibre treatment, the use of alternative or modified fibres, as well as the deployment of biobased materials as substitutes for fossil-based resources. Our internal innovation platform "we.invent" was comprehensively redesigned and now enables all employees, regardless of function or location, to contribute their own ideas. Submitted proposals are reviewed and selected for implementation within a stage-gate process based on a clearly defined set of criteria. In this way, we foster an open innovation culture, stimulate creativity across the Group and strengthen the systematic development of new solution approaches. Sustainability in the focus of innovation activities The impacts of climate change and the Corona pandemic underline the importance of resilient and sustainable structures for both the economy and society. At MM, our objective is to take advantage of this development and to actively support our customers in substituting plastic with innovative and proven pa-per- and cartonboard-based solutions. In doing so, we address the continuing trend towards sustainable packaging, which combines a natural optics with high functionality, convenience and safety. Automation - Key to competitive strength To achieve additional competitive advantages, we are consistently advancing the automation of workflows and logistics processes across the Group. From the very outset of investments in new facilities, our sites receive comprehensive support - ranging from optimal machine configuration and installation to commissioning and final acceptance. The current focus of our automation solutions is on reducing downtime as well as increasing flexibility and efficiency. Innovation activity in the MM Food & Premium Packaging and MM Pharma & Healthcare Packaging divisons in 2025 Innovation network of our Packaging divisions In 2025, MM Food & Premium Packaging further developed its organisational structure in order to strengthen innovation capabilities and customer proximity. The PacProject Innovation Centre in Hamburg was closed as planned, while the establishment of an "Innovation Experience Center" at the Vienna site was initiated. The bundling of development, production and application engineering enables a more efficient implementation of market-oriented packaging solutions. The cross-divisional innovation matrix organisation of MM Food & Premium Packaging and MM Pharma & Healthcare Packaging ensures that the technical expertise of the entire MM Group is deployed efficiently and in a targeted manner to meet customer needs. It comprises the Premium Printing Center in Trier as well as the Technical Account Management, which coordinates customer briefings and acts as an interface to the local Packaging Development Centers and individual plants. The Divisional Technical Support team and the Packaging Development Centers support our customers particularly with regard to technical orientation and equipment, enabling the successful implementation of innovative packaging concepts and designs. Together with the Technical Account Management team, initial feasibility analyses are carried out to ensure the technical viability and efficiency of proposed ideas. At the Premium Printing Center, state-of-the-art technologies are deployed to realise sophisticated packaging designs with special effects in a short time. At the same time, demand for e-trainings and digital learning formats in the field of innovation continues to increase. We therefore offer customised trend and idea workshops as well as technical training to provide our customers with practical know-how and concrete solution approaches. Our cross-divisional innovation team comprises the Innovation Directors of the individual business areas within MM Food & Premium Packaging and MM Pharma & Healthcare Packaging. Through regular best-practice exchange, this structure ensures that increasing market and customer requirements can be addressed effectively. The collaboration between the individual areas enables the identification of relevant technologies and the targeted exploitation of synergies. This also includes close cooperation with MM Board & Paper in the field of innovation. Our objective is to position MM as an industry-leading innovation partner and preferred supplier by focusing on more sustainable, customer-oriented and market-relevant innovations. Current innovation focus In the financial year 2025, innovation activities within the Packaging divisions focused on several strategic priorities, with a clear emphasis on sustainability, functionality and portfolio expansion. The new EASYCLICK packaging solution for washing powder was successfully developed and implemented. It stands out for its reduced material usage while maintaining a high level of functionality and user convenience, thereby combining ecological benefits with efficient handling. In addition, a newly developed E-commerce mailing packaging solution was launched on the market. It is characterised by a significant reduction in material consumption as well as substantially optimised handling during the packing process. As a result, the solution increases efficiency along the value chain and supports the optimisation of logistics processes. With the MM Rigidbox, a high-quality and stable box solution for premium applications, an innovative alternative to conventional rigid box concepts was also created. An innovative processing approach enables outstanding functional properties and further strengthens the Group's portfolio in the premium segment. In the field of Pharma & Healthcare Packaging, the focus in 2025 was on the ongoing development of a product portfolio that meets the highest requirements with regard to patient safety, traceability and user friendliness. This included the market introduction of packaging solutions with NFC technology to enhance product identification, as well as a patented child-resistant folding carton with F1 certification. Innovation activity in the MM Board & Paper division in 2025 In 2025, the innovation focus of MM Board & Paper centred on the further development and qualification of innovative dispersion barriers for various packaging applications, the optimisation of product processing properties, as well as measures to ensure compliance with current packaging and recycling regulations. In the field of dispersion barriers, we increasingly evaluated biobased systems, selectively expanded our supplier portfolio and assessed their performance through extensive laboratory testing. The objective is to ensure key functional properties such as grease and moisture resistance as well as heat-sealability in fibre-based cartonboard solutions, while at the same time further reducing the use of plastic-based packaging. With regard to processing properties, our activities focused in particular on improving bonding performance, increasing process robustness, as well as developing solutions to enable clear traceability of processed packaging products. Another key focus was the expansion of our portfolio to include lighter grammages, both in the liner segment and in virgin fibre-based cartonboard. This approach addresses changing market requirements while simultaneously meeting regulatory standards, such as those of the PPWR aimed at reducing packaging material. In the area of barrier cartonboard, TOPCOLOR® BARRIER AROMA from the Frohnleiten mill represents a major innovation. This cartonboard features a special aroma barrier, making it an ideal solution for packaging of strongly scented products. Strong-smelling substances are reliably retained within the folding carton, effectively preventing any sensory impact on food products. At the Kwidzyn mill, the "Speciality Paper Products" (SPP) product category was further developed. With MM SELECT® Pharma, MM offers an uncoated, woodfree leaflet paper made from 100 % ECF virgin fibres, providing high opacity and excellent whiteness. The optimised surface enables outstanding print results - even for very small, double-sided text - across offset, inkjet and digital printing, while also reducing ink consumption. MM SELECT® Pharma is particularly suitable for printing package leaflets for pharmaceutical, cosmetic and technical products. Awards for innovative and more sustainable solutions MM received eight WorldStar Global Packaging Awards from the World Packaging Organisation (WPO). This international recognition underlines the high level of expertise as well as the close collaboration between MM Board & Paper and the MM Packaging divisions. In addition, two solutions from MM Food & Premium Packaging, developed at the MM Packaging Deeside and MM Packaging France plants, were honoured with Global Packaging Awards, demonstrating the successful combination of design excellence and technological implementation in packaging solutions for international customers. The award-winning cartonboard solutions of MM Board & Paper include a takeaway packaging range made from ALASKA® BARRIER GREASE. This solution supports both functional performance and more sustainable food-service concepts. At the European Carton Excellence Award, presented as part of the ECMA Congress, an Advent calendar developed jointly with an international food manufacturer and MM Packaging Polska received an award in the Confectionery category. The packaging combines high-quality product presentation with added value through integrated design features. The Jury Award of the Carton Austria Award 2025 was presented to an Advent calendar produced using ALASKA® WHITE from MM Board & Paper. This award highlights the material quality and MM's contribution to high-performance packaging solutions. RISK MANAGEMENT 1) Due to its business activity, the MM Group is exposed to a variety of industry-specific and general risks. A Group-wide risk management system is in place to safeguard the Group's existence and ability to create value in the long term. The Management Board not only bears overall responsibility for determining the strategy of the MM Group, but also for implementing an appropriate risk management system and internal control system. The Board defines the risk policy which aims to secure the Group's long-term future by sustainably increasing the Company's value and achieving profitable growth in its core competencies. This requires taking advantage of the opportunities that arise while weighing up the associated risks. MM considers the identification of risks that could jeopardise the increase in enterprise value to be an important management task and therefore an integral part of corporate activities. The primary objective is not to avoid all risks, but to actively manage and overcome risks, the risk policy is characterised by a fundamentally conservative approach. Risk reduction is a high priority and is achieved, where economically justifiable, through suitable control measures and supplemented by the Group's insurance programme. MM Group operates a risk management system to implement the risk policy guidelines of the Management Board and, thanks to its systematisation, is able to identify and assess risks in good time and take appropriate measures to control and manage risks. The staff unit "Internal Audit & Risk Management" reports directly to the Management Board and ensures that risk management is implemented and conducted on behalf and in the interest of the Management Board. The risk portfolio is regularly monitored, updated and documented by the staff unit. Each risk area that is considered to be significant is assigned at least to a risk area officer with relevant expertise. The responsibilities include the analysis, assessment, controlling and monitoring of the respective risk area. Thus, the risk management process does not take place in an isolated way, but as an integral part of the organisation and its procedures. The identified risk areas are assessed in the two dimensions of potential loss and probability of occurrence. Both the inherent gross risk before taking into account the control measures already implemented in the Group and the remaining net risk after taking into account the measures taken are assessed. For each risk identified and deemed significant for the Group, individual early detection, control and hedging measures are determined, taking into account the Group-wide risk policy. These measures are continuously evaluated and further developed or supplemented. They are intended to improve the Group's risk situation without, however, sacrificing opportunities. The risk situation of the MM Group is summarised in an annual risk report and reported to the Management Board and the Supervisory Board. The Group's auditor confirms the functionality of the MM Group's risk management system annually in accordance with rule no. 83 of the Austrian Corporate Governance Code and reports to the Management Board and Supervisory Board. As part of the risk management processes, 30 key risk areas were identified for the Group for the year 2025. The risks explained below were analysed, assessed and managed using suitable measures. In addition to the risk areas considered and assessed separately, the following cross-cutting topics should be mentioned, which are integrated into a large number of risk areas. 1) This chapter covers the content of ESRS 2.36. Sustainability risks In order to emphasise the integrated approach, sustainability risks are implicitly assigned to existing risk areas and considered within them. On the one hand, physical risks, such as climate change or natural disasters, are taken into account. On the other hand, transitory risks, such as changing market requirements and legal regulations, also play a role. Sustainability can also have an influence on investor decisions, product development and the attractiveness as an employer. To manage sustainability risks, the Group relies on a broad package of measures that includes both strategic and operational elements. These include a resource-efficient production, ambitious sustainability targets, the anchoring of sustainability criteria in the remuneration policy and comprehensive monitoring of non-financial key figures. Furthermore, regulatory developments are continuously analysed, while sustainability requirements are increasingly incorporated into research, development and innovation management. In addition, certifications in accordance with PEFC, FSC, EMAS, ISO 14001, ISO 50001 and in the areas of product quality and food safety ensure implementation of sustainability measures. External assessments such as CDP rankings and EcoVadis serve as benchmarks for progress. The Group publishes an annual sustainability report in compliance with the EU Corporate Sustainability Reporting Directive (CSRD) and is guided by international frameworks such as the UN Global Compact, UN Sustainable Development Goals and the EU Green Deal. Geopolitical risks Relevant geopolitical challenges include, among others, the war in Ukraine, increased volatility in transatlantic relations, as well as additional location-specific factors, such as the current political uncertainty in Iran. These factors affect a wide range of identified risk areas, including procurement, energy availability, production, sales, and compliance. In challenging times, the MM Group benefits on the one hand from its broad diversification, while on the other hand specific measures have been implemented to ensure resilience. These measures are explained within the individual risk areas. The most significant risk areas to which the Group is exposed and the measures taken to manage these risks are described below. Procurement The performance of the MM Group is largely dependent on raw materials and input factors which are sourced externally. For the two Packaging divisions these are in particular cartonboard and paper. In the MM Board & Paper division, these include especially fibre materials (recovered paper, wood, pulp), energy, chemicals and logistics services. For procurement there is basically a risk of availability concerning quantity and quality, on the one hand, and a price risk, on the other hand. In the area of fibres (waste paper, wood, pulp), the availability risk results from divers factors. These include, among other things, sufficient volumes of waste paper, geopolitical influences, legal requirements, environmental factors and long-term forest regeneration. Competition from new products that use the same raw materials, transport capacities and developments in energy supply also influence availability. The price risk is determined by the market structure and consumption trends. The number and pricing of suppliers, their contract fulfilment and export demand, particularly from Asia, are key factors. Government regulations, long-term supply contracts and the implementation of new laws (e.g. EUDR) can also have a price-determining effect. The safety and control measures in the fibre procurement of the MM Board & Paper division include monitoring, diversification, strategic planning and optimisation of procurement. Regular monitoring of price and volume trends, existing purchasing contracts and relevant key figures ensures transparency. The wood supply strategy and the diversification of procurement - particularly at the production mill in Kwidzyn -reduce dependencies. In addition, fibre requirements, warehousing and production output are continuously reviewed. Control and optimisation measures include the adjustment of formulations, consumption control and the distribution of quantities among several suppliers. Strategic warehousing and the substitution of external purchases with in-house production strengthen the independence of the MM Group. The long-term procurement strategy is continuously adapted through close market observation, ongoing contact with suppliers and consideration of geopolitical and regulatory developments. Sustainability and compliance, particularly in the context of external FSC and PEFC certifications as well as the EU Deforestation Regulation, are monitored by the "Group Responsible Sourcing" department. There is also an availability risk and a price risk for cartonboard and paper . The availability risk depends on the number of suppliers, their product range and capacity development. Availability is also influenced by suppliers' contract fulfilment, the ability to plan demand through customer orders and rising market demand. Strike risks, particularly in Finland, can also lead to bottlenecks. The price risk results from the market structure, the costs of input factors such as recovered paper, pulp, energy and logistics as well as the general demand situation. The measures for cartonboard and paper procurement in the Packaging divisions focus on diversification, monitoring, strategic planning and optimisation of procurement. To ensure availability, the required quantity per material group is distributed among several suppliers, and the Group's internal cartonboard procurement from the MM Board & Paper division is increased. Procurement agreements with suppliers stipulate quantities, prices, quality, service and logistics. Market developments are continuously monitored via specialist platforms, congresses and trade journals, supplemented by regular dialogue with the suppliers. In addition, the price and volume development of existing agreements is monitored and critical price values are defined, which require action to be taken if they are reached. The optimisation of the purchasing strategy includes tenders for purchasing volumes and data analysis of current business activities with suppliers. Budgeting takes into account consumption and price forecasts, while the four-eyes principle in regard of supplier agreements ensures transparency and security. In the MM Board & Paper division, chemicals are essential for the production of pulp, paper and cartonboard. As they are sourced externally, there is a risk in terms of availability (quantity, quality) and price. Bottlenecks or price fluctuations can cause production problems or stoppages. To ensure availability, the supplier base is diversified and production flexibility is increased by using different qualities and suppliers. Intensive monitoring of needs, prices and supplier stability ensures early risk assessment. Long-term supply contracts with fixed prices ensure stable costs, and central purchasing management optimises procurement. The close exchange with suppliers and market participants helps to minimise supply risks. These measures ensure stable production, controlled costs and reduced dependencies. Energy and emissions Energy (gas, coal, electricity, heating oil) is an input factor of strategic importance, especially for the MM Board & Paper division. In risk assessment, purchase price, basic availability and purchase opportunity are essential parameters. The latter refers to the physical availability of energy, which in the case of gas, coal and oil mainly depends on the political stability of producer and transit countries. Political conflicts, armed conflicts and natural disasters can have a significant impact on the availability and price risk of energy. In some cases, minimum purchase quantities with fixed prices are defined in energy agreements. If the level of those is not reached due to standstills or technical faults, compensation settlements can be due (take-or-pay rule). The price risk for energy is significantly influenced by the development of global energy prices (gas, coal, electricity). The purchase price depends on supply contracts that define conditions such as duration, quantities and bandwidths. The number of potential suppliers at individual locations determines the competitive situation and thus the price trend. Hedging transactions can limit price fluctuations, whereby their timing and efficiency are crucial. In addition, efficient consumption management, coordination with energy suppliers as well as interactions with emission certificates are essential. MM Board & Paper counters the energy risk through a combination of long-term hedging, market observation and increased efficiency. Long-term purchasing contracts secure supplies and minimise price fluctuations. The medium-term purchasing policy is managed in close coordination between energy purchasing and management board. Continuous monitoring of energy and emissions prices, which includes, among other things, a weekly energy-market report, enables the purchasing strategy to be adjusted at an early stage, while linking production and sales planning with energy purchasing improves planning reliability. In addition, the increased use of alternative energy sources, such as biomass or substitute fuels, reduces dependence on fossil fuels. Efficiency measures to reduce specific energy consumption and certification in accordance with ISO 50001 and EMAS also contribute to risk minimisation and sustainable energy management. In 2025, an energy strategy was developed for the Packaging divisions for the first time. The mills of the MM Board & Paper division are in the mid-term confronted with a regulatory risk regarding the availability of emission certificates , which are restrictively allocated according to the cap and trade principle. Although MM Board & Paper receives some free allocations due to its energy-efficient plants, these are expected to be gradually reduced. Missing certificates must be purchased on the open market, which creates a price risk that is partially hedged through forward contracts. The indirect cost effects caused by the influence of certificate prices on the electricity price are cushioned in many locations by subsidies (electricity price compensation) on the basis of long-term national regulations. The Packaging divisions are also affected by indirect emissions pricing, as regulatory requirements in the EU and individual countries (e.g. Germany, Austria) can lead to higher CO₂ costs, which affect the overall cost structure. In order to minimise the risk associated with emission certificates, MM Board & Paper relies on the systematic recording and management of CO₂ emissions. The monthly recording of emissions enables the early identification of surplus or shortfall quantities, which are offset within the Group or purchased on the market in a targeted manner. An own trading platform ensures that certificates are traded in line with demand, while continuous monitoring of price trends supports strategic purchasing decisions. In addition, close cooperation with industry bodies ensures up-to-date information on regulatory changes. These measures reduce the price risk and ensure compliance with legal requirements. Production The Group systematically develops and modernises its production facilities and processes to ensure that they are always state-of-the-art. Thereby, a focus is placed on a sustainably responsible production, taking economic, environmental and social aspects into account with the aim of generating long-term benefits for our stakeholders. A high degree of technical availability ( operational readiness ) is crucial in both cartonboard and folding carton production. Production downtime or limited operational readiness represent a considerable risk. This can be caused by machine defects, power failures, the expiry of operating licences, natural disasters or other unforeseeable events such as fire, flooding or low water levels. Such disruptions can result in loss of sales, customer losses or claims for damages. Environmental and safety risks can also arise, for example due to faulty production processes or occupational accidents. To minimise this risk, the MM Group relies on comprehensive maintenance and risk management. This includes systematic monitoring of machines, preventive maintenance measures and strategic spare parts storage. In addition, the "mill back-up" concept of the MM Board & Paper division enables the flexible relocation of production capacities. Regular training, quality certifications and close cooperation with machine suppliers further reduce operational risks. Insurances and continuous risk engineering protect against residual risks. Sustainability measures such as energy efficiency programs, recycling management concepts and resource conservation also help to ensure long-term production reliability and competitiveness. A lack of investment efficiency can result from cost overruns, technical defects or delays in completion. These risks lead to financial losses, production downtime and possible reputational damage. External factors such as supply bottlenecks or unforeseeable events can further exacerbate the situation. This results in economic risks such as value adjustments, loss of sales and increased costs due to inefficient production or external procurement. In addition, failure to fulfil sustainability targets or contractual obligations can lead to further financial and legal consequences. To minimise risk, the Company relies on careful investment planning and control. The approval process is structured and tracked using a web-based CapEx tool. Clear responsibilities, project and risk analysis, regular project monitoring as well as tests and pilot projects ensure that investments are implemented efficiently. Fixed price agreements, penalties and bank guarantees serve as a hedge against financial risks. Moreover, investments are continuously recalculated and their sustainability targets monitored. Close cooperation between local specialist departments, central technology and purchasing ensures that proven components and efficient suppliers are selected. The fulfilment of product standards and the assurance of consistently high product quality are of central importance for MM Board & Paper and the Packaging divisions, particularly in the areas of product safety and food contact. Risks arise from short-term legal changes, newly emerging interactions between ingredients or changes in customer requirements. Non-conformity can lead to liability claims, reputational damage and loss of customers. In addition, compliance with traceability requirements poses a particular challenge, as complete documentation is required along the entire value chain. To counteract these risks, the Company relies on the implementation of a cross-divisional Safety & Quality organisation as well as a multi-stage quality assurance system that includes regular checks and audits along the entire value chain. ISO 9001 and ISO 22000 certifications as well as the GMP system ("Good Manufacturing Practice") ensure that relevant standards are adhered to. Raw materials are thoroughly tested before use and production adjustments are subject to extensive test phases. The Company also stays informed about regulatory developments by actively participating in European expert committees. Continuous monitoring of customer enquiries and complaints enables early identification of potential risks and a rapid response to ensure product safety. Sales The MM Group supplies a total of several thousand customers. Given the high level of diversification across different market segments and regions, dependence on individual major customers is considered manageable. Demand for MM Group's products is directly related to the overall economic situation, particularly the need for everyday consumer goods. Economic fluctuations or changes in packaging trends, but also import pressure from competitors with cost advantages, can influence sales volumes and prices. The Packaging divisions face different risk factors in their respective market and customer segments. In the Food & Specialties area, these include general demand risks, continued price pressure, and the impact of trade tariffs on customers. The market for cigarette packaging is subject to increasing regulatory risk. Many countries are implementing stricter non-smoking measures as well as requirements for warning labels and "plain packaging". In the EU, the Tobacco Products Directive (TPD2) regulates these labelling obligations, and a revision (TPD3) is currently underway. Market developments are also relevant, such as a partial shift in demand towards alternative products like heated tobacco and nicotine pouches. In the Pharma & Healthcare Packaging area, MM continues to hold a strong market position and a broadly diversified customer portfolio. In the medium term, regulatory risks may also arise here, for example through the revision of EU pharmaceutical legislation. The cartonboard and paper market in particular continues to be characterised by intense competition. In the virgin fibre cartonboard segment, this is primarily due to existing (over)capacity as well as external factors such as trade restrictions. Recycled cartonboard is exposed to substitution risk from other board grades. This is partly attributable to price developments in recent years and to regulatory measures, such as the producer responsibility fee per tonne of packaging material. To minimise risk, MM relies across all divisions on a broad diversification of its customer base and close strategic cooperation with key customers. Regular market analyses and credit rating checks ensure that potential risks are identified at an early stage, while innovative product developments and flexible production capacities increase the ability to adapt to market changes. The multi-mill concept within Board & Paper improves delivery reliability and targeted sales strategies help to open up new market segments. By systematically monitoring contracts, price developments and customer requirements, MM can react to challenges at an early stage and secure its competitive position in the long term. In order to consolidate and expand its market position, the Group is pursuing a strategy of strengthening its competitiveness also through efficiency improvements, sustainability and innovation.

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