Holmen AB

Welcome everybody to the interim report presentation for the Holmen Group for the first quarter of 2020. My name is Henrik Sjölund and together with me I have also Mr. Anders Jernhall and we will go through the presentation for our company and once we've finalized the presentation we're happy to take any questions you might have. If we start with a very short summary, looking at our operating profit in the first quarter, we come out with 628 million SEK, which is actually a rather good result given the circumstances with COVID-19, etc. We can say from the beginning that... The coronavirus has had very limited impact on our business and our result in the first quarter. We'll come back to some comments regarding the different business areas later on. In a historic perspective, as you can see, the result is good. Also, the margins are stable and on a fair level. And if we then have a look at... The situation, given looking at our cash flow in the company, it has been also rather good in the first quarter and also on a stable level compared to the previous quarters. We have a very good financial position. 75% of our balance sheet consists of forest. And despite the very strong and good position we have when it comes to the finances, the board of directors, they have today decided to propose to the annual general meeting to not give dividend at the upcoming annual general meeting in June. However, we will see what we see when we come through the summer and after the summer, if we find it appropriate to give dividend or to propose that we will come back a bit later. Starting off then with our forest activities and especially looking at the wood market. The situation as it is right now is that there's quite good availability of wood actually. And of course also the forest is impacted a bit or the activity in the forest is impacted a bit of the coronavirus. And with lower economic activity and lower activity in the industry, There is more wood available, both pulpwood and timber, and that has given a bit price pressure, which Anders will come back to. Overall, though, if you look at this is a short-term effect, long-term still the Swedish industry consumes a lot more pulpwood than actually what can be sustainable harvested. Our own harvesting levels in the first quarter, they weren't a normal level. Going forward, if needed, and if we will need to go for slightly lower levels the next coming quarters, for us that's not a big problem as we just leave some trees to grow for a bit longer and become more valuable. Anders, what about the financials and the forest?

Yeah, it's a pretty normal quarter in Q1, 322 million SEC in operating profit. As Henning mentioned, prices are lower, and as you saw from the graph, it's roughly 5% lower selling prices than a year ago. What we see this quarter is that we have an effect of the new accounting principle for forest, which have positively contributed to the result by 40 million SEC. And that do explain the increase in earnings compared to the previous quarter. Back to you, Henrik.

Thank you. Then moving on to paper board. If you look at the market, we have a situation where actually demand is not bad. If you look at the market development in Europe, demand is roughly on the same level as last year, actually a little bit better. Deliveries from European suppliers to European customers. And also when it comes to prices, prices are relatively stable. When it comes to demand, however, we see quite big differences between different customer segments. If you are in food, drinks, obviously, and pharma, demand is really good. If you are in graphics, it's a bit less good. Our own performance and our own situation is that we had really good deliveries in the first quarter. 147,000 tons is actually on the record level when it comes to deliveries in one quarter. Also, our order book is on a healthy level, despite the situation with the coronavirus we have. And that is... thanks to good demand from some segments and a bit less good demand from other segments. If we look then at our financials, are we happy with what we have performed, not only the deliveries?