Svenska Cellulosa Aktiebolaget SCA (publ)

Good morning and welcome to this presentation of SCA's 2025 third quarter results. With me here today I have President and CEO Ulf Larsson and CFO Andreas Everts to go through the results and take your questions.

Over to you Ulf. Thank you Anders and also from my side a good morning. Happy to present the result for the third quarter 2025. So, and when I summarize the quarter, we can state that the CA continued to deliver a solid result in a rather challenging environment. Our high degree of self-sufficiency in strategic areas continued to be an important factor to mitigate higher costs, not the least related to wood-raw materials. Our EBITDA reached 1.64 billion SEK and by that an EBITDA margin of 33% for the third quarter. In Q3 2025 we had substantially lower prices in the pulp segment in comparison with the same period last year. Our planned maintenance stops in pulp and container board were also considerably more extensive compared to the same quarter last year. Delivery volumes in the container board segment increased this year compared with the same quarter last year, driven by the continued ramp up of our Obola container board mill. The uncertain market situation, mainly dominated by changing tariffs, continues to affect market conditions. The forest industry in general is momentarily challenged by a weaker, with a market with soft underlying demand in many product areas. Turning over to Siam Financial KPIs for the third quarter 25. As already mentioned, our EBITDA reached 1.64 billion SEK in the quarter, which corresponds to a 33% EBITDA margin and a 22% EBIT margin. Our Industrial Return on Capital Employed came out just over 6%, counted for the last 12 months. and the leverage was at 1.7 times with our ViolaNet debt to equity reached 11.2%. I will now make some comments for each segment starting with Forest. Higher harvesting levels from our own forest have not the least contributed to stable supply of wood-raw materials to our industries during this period. We have seen a continuous long-term trend of increasing prices for both pulpwood and saw logs, as can be seen in the graph on the bottom left. Regarding pulpwood, we have now passed the peak, I guess, and prices have started to come down during this quarter. Demand for saw logs continues to be high, especially for spruce logs. When one compares Q3 2025 with Q3 2024, sales were up 14%, while EBITDA was up 17%, mainly due to higher prices for wood raw materials. Turning over to wood. In general, we still have a slow underlying market for solid wood products. As said before, we have noted signs of improvement in the repair and remodeling segment this year in comparison with the last year. But the uncertainty in general economic development continues to affect the market recovery negatively. Stock levels remain on the high side among producers for pine but are on normal levels for spruce. Stock levels at customers continue to be on the low side. The volumes in both production and deliveries were good for SEA during the quarter, resulting in a close to unchanged stock level of zone goods. The price for solid wood products decreased by 5% in the third quarter of 2025 in comparison with the second quarter of 2025. This development is in line with what I said when I presented the report for the second quarter. As expected, the cost for saw logs has increased from the second to the third quarter and we also expect them to continue to increase going into the fourth quarter. Sales were in line with the same quarter last year. EBITDA margin decreased from 19 to 15 percent due to higher raw material costs and a negative currency effect. Today's stock level of solid wood products in Sweden and Finland is described at the top left on this slide and is shown in relation to the average for the last five years. As mentioned earlier, we note that the inventory level is on the high side, especially for pine, while the SCA level is rather normal. As can be seen in the diagram to the bottom left, the Swedish and Finnish sawmill production has been on a normal level during the first eight months of 2025. In the diagram to the top right, we can note that the price decreased during the third quarter. The decrease in pine has been larger in comparison with spruce products. Going into the next quarter, I estimate that prices on average again will decrease by up to 5%, somewhat more for pine and somewhat less for spruce. And this is driven by the momentarily high availability of pine products. the construction sector we can conclude that start of new buildings continues to be low as said before uncertainties are still present but we see improved consumption in the repair and remodeling sector the level of duties now put in place on wood products from canada delivered to us about 45 percent in comparison to the level for wood products from european union delivered to the us about 10% has strengthened the competitiveness for EU producers in comparison with Canadian producers. And I guess it's likely that the price level in US will increase when stock levels are coming down from today's high levels. So, over to PALP. When comparing Q3 2025 with Q3 2024, sales were down 21%, mainly due to lower prices. a lower delivery volume and a negative currency effect. EBITDA was down 57% compared to last year, mainly due to lower prices, a negative currency effect and higher cost for wood-drawn materials. The cost for the planned maintenance stop was SEK 83 million this quarter compared to SEK 35 million in Q3 2024. Global demand for pulp was at a healthy level during the first quarter of 2025. During the second quarter, the market changed with reduced demand and prices came under pressure, much due to uncertainty related to US tariffs. During the third quarter, prices on MBSK pulp were stable at low levels. On the demand side, we saw increased activity in China during the quarter. The weakening of the US dollar in relation to the Swedish krona, which started already in Q1, continued to have a negative impact on the price in SEC, also in Q3. Tariffs on MBSK pulp from the European Union to the US were removed during the third quarter, and this allows us to maintain a competitive offering in the US. Looking at CTMP, prices have been unchanged in Asia at low levels and have decreased slowly in Europe during the third quarter. Inventories of softwood and CTMP have been increasing in July and August as you can see in the diagram and are now on the high level. Hardwood inventories, on the contrary, were stable during the third quarter. Moving over to container board. Sales were up 10% in Q3 in comparison with the same period last year, driven by higher delivery volumes and higher prices, somewhat mitigated by a negative currency effect. EBITDA was down by 39%, very much driven by a long planned maintenance stop with a cost of 204 million SEK versus 87 million SEK in Q3 2024. Higher costs for wood raw materials and a negative currency effect also had an impact. We have seen a softer box demand during the last quarter, but still with a positive development on a year-to-date basis. The retail business remains on a positive driver. On the other side, we continue to see a weak European manufacturing industry, which for the moment drives the demand in a negative direction. After a stable first half of the year of European demand, our container board has started to decrease in Q3. Due to the current turbulent macro environment, it's difficult to have a view on the long-term demand. In Q3, we have seen additional supply coming on stream, with the vast majority coming in test liner. We do not expect further capacity increases in Q4, except from the ramp-up effect of newly-start machines. Kraftliner inventories remain above average level in Q3 as you can see in the graph. During Q3 the availability of OCC has been good, driven by the lower demand in the quarter, which in its turn has led to decreasing prices of OCC. Moving into Q4 we see the availability of OCC to be stable and expect prices to be more or less unchanged. Prices for Brown Craft Liner in Central Europe has during Q3 decreased with 20 euro per tonne driven mainly by slow demand and reduced prices of OCC. White Craft Liner has remained stable. Finally, I will say some words about renewable energy. In this area we have had a weaker quarter compared to the same period last year, mainly due to lower prices in wind power and solid biofuels. Continued improvements in ramping up Gothenburg biorefining are partly compensating for this. The market for solid biofuels in northern Sweden continues to be weak due to warm weather and low electricity prices. This fact increases our export share and by that reduced margin. For liquid biofuels we have seen higher margins compared to previous quarters. The main reasons are tighter supply due to maintenance stops in biorefineries, European countries implementing RED3 and better control mechanisms within the EU regarding imported feedstock. We expect market volatility in renewable fuels to remain high as Europe ramps up the blending mandates both in HVO and SAF. Electricity prices were low during the quarter, which impacted on our wind business negatively, but is good of course for SEA as a net buyer of electricity. SEA's land lease business is stable at 9.7 terawatt hours, which is equal to 20% of installed capacity wind power in Sweden. Installed capacity on our land is expected to reach 10.5 terawatt hours by the end of the year. And by that, I hand over to you, Andreas.

Thank you, Ulf, and good morning, everybody. I'll start off with the income statement for the third quarter. Net sales decreased 5% to 5 billion, driven by negative currency effects and lower prices, which was partly offset by higher delivery volumes. EBITDA decreased 18% to 1.6 billion, driven by negative currency effects, lower prices, and higher costs for planned maintenance stops. EBIT decreased to 1.1 billion, and financial items totaled minus 103 million. With an effective tax rate of just below 20%, bringing net profit to 0.8 billion, 1.19 SEC per share. On the next slide, we had the financial development by segment. It started with the forest segment to the left. Net sales decreased to 2.4 billion, driven by lower delivery volumes compared to the previous quarter due to several planned maintenance stops at SES Industries. EBITDA decreased to 912 million due to seasonal lower harvest from SA's own forest. In wood, prices decreased compared to the previous quarter, while the cost for solos continued to increase. Net sales decreased to 1.5 billion due to low delivery volumes and lower prices compared to the previous quarter. EBITDA decreased to 232 million, corresponding to a margin of 15%. In pulp, net sales decreased to 1.65 billion driven by lower delivery volumes and lower prices. EBITDA decreased to 242 million, corresponding to a margin of 15%. High cost for planned maintenance stops and lower prices were offset by lower cost. We had lower energy and raw material cost in the quarter, and Q3 is also a low-cost quarter for indirect costs in all segments, which had a positive impact. In container board, net sales decreased to 1.8 billion and EBITDA decreased to 194 million, corresponding to a margin of 11%. The result was negatively impacted by planned maintenance stops in both Mungsund and Obola of 204 million. The market for renewable energy continued to be weak. EBITDA decreased compared to the previous quarter and amounted to 79 million, corresponding to a margin of 21%. The decrease was mainly driven by lower deliveries of solid biofuels. On the next slide, we have the sales pitch between Q3 last year and Q3 this year. Prices decreased 2% driven by lower pulp prices. Volumes increased 1%, driven by higher volumes in container board, which was also set by lower volumes in pulp. And lastly, currency had a negative impact of 4%, bringing net sales to 5 billion. Moving on to the EBITDA average, and starting to the left, price mix had a negative impact of 99 million, and higher volumes had a positive impact of 14 million. Higher costs for mainly wardrobe materials had a negative impact of 57 million, which was mitigated by our health highs degree of self-sufficiency. We had a positive impact from energy of 37 million and a negative impact of currency of 169 million. This was impacted by higher cost for planned maintenance stops. And in total, EBITDA decreased to 1.6 billion, corresponding to a margin of 43%. Look at the cash flow. Operating cash flow increased to 1.1 billion for the quarter and 2.5 billion for the first nine months. And as you know, other operating cash flow relates mostly to working capital currency hedges and should be seen together with changes in working capital. Look at the balance sheet. The value of the forest asset totaled 108 billion. Working capital decreased compared to the previous quarter, and totaled 5.6 billion. Capital employed totaled 160 billion, and net debt decreased compared to the previous quarter to 11.7 billion. We have now almost finalized our large ongoing investment projects. Equity totaled 104 billion, and net debt to equity was 11%. Thank you. With that, I'll hand back to you, Ulf.