Holmen AB

Good morning, everybody, and welcome to the interim report presentation for January-September for the Holmen Group. It's me, Henrik Sjölund, and Anders Jernhall, and we do the presentation together, and after that we take all the questions you hopefully have. But we know you have a busy day today, so let's get started. We were able in the third quarter to reach an operating profit over a little bit more than one billion SEK, which is, in our view, a good result, thanks to board and paper especially, and also despite a bit challenging market situations and actually lack of wood to some extent as well. Our industry, board paper and wood products, if you just take a look and see what we have done the last year, we have a return on capital employed of 16%. And over the last 10 years, we have been able to reach average 18%. And our financial position is strong. And remind ourselves that we, the last couple of years, we have been able to distribute back to shareholders through dividends and also share buyback program, including or mounting to 6 billion SEK. We have currently a net debt of 6% of equity or 3.5 billion SEK roughly. But let's go into our different business areas and starting with the forest or more the wood market in Sweden. We have discussed this quite a lot the last couple of years. And if you look at, say, the last two years at least, there hasn't really been enough raw material to feed the forest industry sector and the energy market as well, I should say. Same goes for the third quarter, where we again have seen increasing prices, saw logs and pulp wood, and we are now at the level which is record high, or 50% higher than three years ago. We are also in a situation, especially for saw logs, or for saw logs, I should say, where we see that prices in the northern parts of Sweden are on a different level than in the south of Sweden, where they are extremely high. I'll come back to that a bit when we discuss wood products. Higher prices on this.

Yeah, these high prices, of course, translate over time into high profits. We've seen the cash flow from the forestry activities increase by 60% the last three years. Q3, if we look at that isolated, that's always normally a quarter where we thin more and harvest less. And that was the case this year, which takes down the operating profit. But we also made the final harvesting a bit lower than before. than seasonally normal for Q3, which took down cash flow a bit, and we had more silviculture actions in our forestry, which consumed cash flow, and that's the reason why the operating profit is not really affected much by that, but the distribution between change in value and cash flow, where we have lower cash flow than normal in the third quarter due to more silviculture and less harvesting than normal. Back to you, Henrik.

Thank you. Renewable energy. We like hydropower and wind, but I think we had a bit of headwind in the third quarter. We had so low electricity prices, actually the lowest electricity prices in Sweden in the last 20 years. And the question is, how could that be? Well, at least amongst explanations, an important part of the explanation is that there were limitations in the transmission capacity from Sweden to other countries in the cables, other countries where electricity prices are higher than in Sweden. We could save a bit of water in our water reservoirs, but such low prices, Anders, it's not easy.