BANK OF AMERICA MERILL LYNCH PAN EUROPEAN PAPER & PACKAGING - - PowerPoint PPT Presentation

BANK OF AMERICA MERILL LYNCH PAN EUROPEAN PAPER & PACKAGING FORUM

17 September 2013

2

Agenda

Mondi overview Operational overview Capital allocation Summary Appendices

3

Our journey since Mondi’s demerger and listing

10 20 30 40 50 60 70 80 0% 50% 100% 150% 200% 250% Mondi Plc FTSE100 Underlying EPS (RHS) Index (2 July 2007 =100) Cent/share



Compound annual EPS growth

• f 20%



Cash dividends paid of €0.6 billion



In specie dividend distribution of €0.2 billion1



€2.8 billion capital expenditure



Disposed of non-core assets for a value of approximately €0.3 billion



Approximately €1.6 billion spent

• n acquisitions



Investment grade credit ratings (BBB-, Baa3) since October 2011

(1) Distributed upon demerger of Mpact.

69.2 68.1 47.0 18.7 33.9

Share price development (index) and annual underlying EPS (cent/share) Highlights

4

Repositioned business delivering strongly

(1) Average 3 year ROCE is arithmetic average.

 Mondi

demerger & listing

 Corrugated packaging

restructured & repositioned

 Swiecie RCB machine

commissioned

 Europapier sold  Hadera (25.1%)

sold

 Syktyvkar

modernisation completed

 Mpact

demerged

 Swiecie minorities

acquired

 Nordenia acquired  Duropack plants

acquired

 Aylesford sold

Key milestones:

870 814 645 798 964 923 554 10.6% 9.5% 7.6% 12.3% 15.0% 13.6% 14.8%

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0%

2007 2008 2009 2010 2011 2012 H1 2013

EBITDA ROCE %

9.2% 13.6% Hurdle rate 13%

EBITDA (€ million) and ROCE1 (%)

5

Mondi today – a focused packaging and paper Group

2012 Revenue1 Products LTM ROCE%2

Packaging Paper Fibre Packaging Consumer Packaging UFP 20.1% 12.0% 10.1%3 17.4% 12.8%

30% 9%

€1,896m

29% 8% 23% 10%

€1,860m €1,167m €1,466m €702m Europe & International

27% 26% 17% 21% 9%

South Africa

(1) Pro-forma segment revenues, before elimination of inter-segment revenues, including Nordenia’s full year 2012 revenues. (2) LTM as at 30 June 2013. (3) ROCE% has been adjusted for the Nordenia one-off costs and includes Nordenia from date of acquisition.

6

Our strategic pillars

We aim to exceed our hurdle rate of return on capital employed through the cycle of 13%

Achieve leading market positions Maintain and/or develop leading market positions in our core packaging and uncoated fine paper markets, with specific focus on higher-growth emerging markets Maintain a high-quality, low-cost asset base Maintain our low-cost, high-quality asset base by selectively investing in production capacity enjoying sustainable cost advantages Continuous focus on performance Focus on performance through continuous productivity improvement and cost reduction, delivered through business excellence programmes and rigorous asset management Grow through customer focused development Develop markets and products aligned to our customer needs by developing products according to their requirements, increasing our exposure to more value added, innovative, technologically advanced products and by following our customers into high growth emerging consumer markets

7

Free cash flow priorities Maintain investment grade credit metrics

As appropriate

Our free cash flow priorities

Selective capital investment opportunities (optimisation of asset base) Support dividends M&A and/or increased shareholder distributions



Future growth focused on faster growing packaging segments



Continue to assess opportunities that are value enhancing to the Group

8

Grow th priorities

Other

12%

UFP 21% Industrial packaging

19%

Consumer exposed packaging

48%

Group 2012 pro forma revenues (%)1

 Growth will be in packaging  Within packaging, bias towards

consumer exposed packaging

 A geographic preference for emerging

markets

50%

Mature markets

50%

Emerging markets Group 2012 sales by destination (%) Packaging

(1) “Consumer exposed packaging” includes containerboard, corrugated packaging, coatings and consumer packaging external revenues. “Industrial packaging” includes kraft paper and industrial bags external revenues. “Others” includes pulp, newsprint, energy, other external revenues. Includes Nordenia for the full year 2012.

9

272 302 366

H1 2012 H2 2012 H1 2013

€ million

Half year 2013 highlights

Financial

 Record results:

 Underlying operating profit up 35%  Underlying earnings per share up

60%

 Cash generated from operations of

€431 million, up 21%

 ROCE of 14.8%, well in excess of

through-the-cycle hurdle rate of 13%

Operational

 Integration of acquisitions and related

synergies on track

 Major capital projects on time and within

budget

€ cents per share 30.9 38.3 49.4

H1 2012 H2 2012 H1 2013

Underlying operating profit and ROCE Earnings per share 13.4% 13.6% 14.8%

ROCE %

10

Performance drivers

 Focused on markets enjoying growth:

 Geographic exposure – 50% of sales into higher

growing emerging markets

 Product mix – two-thirds of sales in packaging,

typically enjoying structural growth

 Well invested asset base in regions enjoying low

• perating cost structures:

 83% of upstream pulp and paper asset base in

low-cost emerging markets

 Decentralised operating model with relentless focus

• n performance

A clear and consistent strategy, delivering a ROCE

• f 14.8%

(last 12 months)

11

 Passion for performance  Caring  Acting with integrity

The Mondi Way

 Operational Excellence  People Development  Sustainable Development

and Safety

 Cutting Edge

Products

 Customer

Focus

 Dynamic  Respectful  Responsible  Entrepreneurial  Empowered  Transparent

Values Purpose Strategy Mondi Diamond Culture

To create solutions for our customers’ success, delivering exceptional value for stakeholders in a sustainable way

 Leading market positions  High-quality, low-cost asset base  Customer focused development  Focus on performance

12

Agenda

Mondi overview Operational overview Capital allocation Summary Appendices

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

13

104 123 148

18.5% 17.9% 20.1% 10.8% 13.1% 14.2%

H1 2012 H2 2012 H1 2013

ROCE % Underlying operating profit margin

Packaging Paper

 Strong performance with ROCE of 20.1%  Price increases in all containerboard

grades

 Good production, particularly in Syktyvkar  Benefited from lower input costs,

particularly recovered fibre

 Logistics synergies realised from

Corrugated plants acquisition

 No major maintenance shuts in the period

– all scheduled for H2 2013

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Underlying operating profit and ROCE

€ million

14

0.40 0.60 0.80 1.00 1.20 1.40 1.60 2007 2008 2009 2010 2011 2012 2013

Packaging Paper | industry fundamentals

Virgin containerboard

 Supply side contraction and lower imports

 Average benchmark prices up 12% on

H1 2012 and 4% on H2 2012

Recycled containerboard

 Improving pricing environment, but industry

profitability still poor

 Average benchmark prices up 3% on H2

2012

 €50/t price increase announced to take

effect from August 2013

 Competitor activity

 Little impact from new Polish capacity as

yet

 Closures announced in the UK

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Selling prices

Kraftliner White-top Kraftliner RCB/Recovered paper differential Price indexed vs 2007 opening levels

15

0.50 0.60 0.70 0.80 0.90 1.00 1.10 2008 2009 2010 2011 2012 2013

Packaging Paper | industry fundamentals

Kraft paper

 Pricing is stable  Demand in Europe remains under

pressure, offset by continued good export markets

 No significant supply side changes

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Selling prices

Sack kraft Price indexed vs 2008 opening levels

16

0.6 0.7 0.8 0.9 1.4 1.6 1.8 2.0 H2 2011 H1 2012 H2 2012 H1 2013

million

47 54 48

10.9% 12.5% 12.0% 5.0% 5.9% 4.8%

H1 2012 H2 2012 H1 2013

ROCE % Underlying operating profit margin

Fibre Packaging

Corrugated packaging

 Stable pricing and volumes  Paper input price increases putting pressure

• n margins

 Benefited from 2012 acquisitions

Industrial bags

 Growth in key overseas markets offsetting

continued weakness in Europe

 Benefited from restructuring in southern

Europe

 One-off gain of €3 million in H2 2012

Coatings

 Higher resin input costs  Weaker volumes, mainly in automotive and

building applications

 Volumes under pressure from new competitor

capacity

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Underlying operating profit and ROCE

€ million Industrial bags (000 units) - (LHS) Coatings (m²) - (LHS) Corrugated packaging (m2) - (RHS)

Production volumes

17

10 23 39

14.6% 10.8% 10.1% 6.7% 6.5% 6.7%

H1 2012 H2 2012 H1 2013

ROCE % Underlying operating profit margin

Consumer Packaging

1 Underlying operating profit and ROCE% has been adjusted for the one-off costs of €14 million in H2 2012

 Integration progressing well  Net synergy gains and additional cost

reduction activities

 Partially offset by marginally lower sales

volumes (pro-forma)

 Closure of Lindlar plant on track

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Underlying operating profit and ROCE1

€ million

18

100 91 102

15.7% 16.7% 17.4% 13.4% 12.7% 13.8%

H1 2012 H2 2012 H1 2013

ROCE % Underlying operating profit margin

Uncoated Fine Paper

 Strong operating performance with ROCE

• f 17.4%

 Volumes at similar levels to H1 2012  Average selling prices slightly down on H2

2012 driven by market mix and weak European demand

 Wood costs down

 Improved forestry management in

Russia offsets inflationary cost pressures

 Higher pulp costs squeeze margins at

Neusiedler - restructuring underway to improve competitive positioning

 All major maintenance shuts scheduled for

H2 2013

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Underlying operating profit and ROCE

€ million

19

0.40 0.60 0.80 1.00 1.20 1.40 1.60 2007 2008 2009 2010 2011 2012 2013

A4 b-copy €/tonne Pulp (BHKP) €/tonne (RHS)

Uncoated Fine Paper | industry fundamentals

Demand

 Structural decline continuing in western

Europe

 Demand growth still seen in emerging

Europe and Russia

Supply

 New capacity in Russia and France – so

far little market impact

Pulp and A4 B-copy prices

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division Price indexed vs 2007 opening levels

20

29 40 44

9.1% 9.6% 12.8% 8.1% 11.3% 13.5%

H1 2012 H2 2012 H1 2013

ROCE % Underlying operating profit margin

South Africa Division

 Improved result, with ROCE of 12.8%  Domestic sales volumes increased  Pricing

 Domestic price increases achieved  Higher average export pulp and white-

top kraftliner prices

 Gains from weaker rand  Lower fair value gain on forestry assets  Closure of 1 newsprint machine in

Merebank and related restructuring

 Annual maintenance shut at Richards Bay

mill planned for H2 2013

Packaging Paper | Fibre Packaging | Consumer Packaging | Uncoated Fine Paper | South Africa Division

Underlying operating profit, margin and ROCE

21

Agenda

Mondi overview Operational overview Capital allocation Summary Appendices

22

Major capital investments

Description Progress

Energy Projects

 Frantschach recovery boiler  Richards Bay turbine  Stambolijski turbine  Syktyvkar bark boiler  Finalisation of commissioning with start-up in H2 2013  Start-up late H2 2013  Start-up late H2 2013  Completed

Syktyvkar

 Pulp dryer – 100 000 tonne capacity  Start-up H2 2014

Štěti

 155 000 tonne capacity bleached kraft paper

machine

 Start-up H1 2014

Ružomberok  Recovery boiler and improvements in chemical

recovery and green energy

 Start-up H2 2014

€370 million of major capital investments on track

23

Agenda

Mondi overview Operational overview Capital allocation Summary Appendices

24

Summary

 Strong financial performance

 Underlying operating profit up 35%  ROCE of 14.8%, well in excess of Group’s through-the-cycle target of 13%

 Integration of acquisitions and delivery of synergies on track  Major capital projects on time and within budget  Outlook

 Demand in Europe generally remains soft  Increased uncoated fine paper capacity a concern  All major annual maintenance shuts in H2 – estimated €50-60 million impact on operating

profit

 Expected continuation of good pricing environment in packaging grades

 We remain confident of delivering in line with our expectations

25

Agenda

Mondi overview Operational overview Capital allocation Summary Appendices

26

Operating financial highlights

1 Underlying EBITDA is operating profit before special items, depreciation and amortisation 2 Underlying operating profit is operating profit before special items 3 Group return on capital employed (ROCE) is an annualised measure based on a 12-month rolling underlying operating profit plus share of associates net earnings divided by average trading capital employed before impairments and adjusted for major capital projects not yet commissioned

€ million H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012

Group revenue 2,819 2,971 3,342 19% 13% Underlying EBITDA¹ 437 490 554 27% 13%

% Margin 15.5% 16.5% 16.6%

Underlying operating profit² 272 302 366 35% 21%

% Margin 9.6% 10.2% 11.0%

Group ROCE³ 13.4% 13.6% 14.8%

27

272 22 65 (24) 1 4 35 (3) (11) 5 366 50 100 150 200 250 300 350 400

Variance analysis

Underlying operating profit development

Sales volume improvements Net positive price variances Increase in variable costs Acquisitions and disposals Currency effects H1 2012 Net

• ther

impacts H1 2013 Lower fixed costs Lower fair value gains

• n

forestry Write- down

• f green

energy credits

€ million

28

104 47 10 100 29 123 54 9 91 40 148 48 39 102 44 20 40 60 80 100 120 140 160 Packaging Paper Fibre Packaging Consumer Packaging Uncoated Fine Paper South Africa Division H1 2012 H2 2012 H1 2013

1 Underlying operating profit is operating profit before special items

Divisional underlying operating profit¹

€ million

29

Financial review

1 Underlying operating profit is operating profit before special items 2 Comparatives are restated to consolidate Mondi Shanduka Newsprint and account for Aylesford on the equity method, both previously proportionately consolidated

€ million H1 20122 H2 20122 H1 2013 % change vs H1 2012 % change vs H2 2012

Underlying operating profit

1

272 302 366 35% 21% Net finance costs (55) (55) (57)

• 4%
• 4%

Net income from associates (1) (4) 1 Underlying profit before tax 216 243 310 44% 28% Tax before special items (43) (47) (56)

• 30%
• 19%

Total non-controlling interest (24) (11) (15) 38%

• 36%

Underlying earnings 149 185 239 60% 29% Special items (after tax and minorities) 4 (96) (68) Reported profit after tax and minority interests 153 89 171 12% 92% Underlying earnings per share (€ cents) 30.9 38.3 49.4 60% 29%

30

Finance costs

 Finance costs up on higher average net debt  Offset by lower effective interest rate

 Higher proportion of debt in Euro  Unwind of fixed rate swaps in 2012 € million H1 2012 H2 2012 H1 2013

Closing net debt 1,257 1,872 1,844 Average net debt 976 1,515 1,851 Finance costs 49 46 52 Net interest on defined benefit arrangements 6 9 5 Net finance costs 55 55 57 Effective interest rate (before capitalised interest) 9.4% 6.6% 5.5%

31

Taxation and non-controlling interests

 Benefiting from

 Profit mix  Investment incentives, notably

Poland

 Lower charge due to

 Acquisition of Świecie minorities

in April and May 2012

 Partly offset by higher profits at

Ružomberok

Taxation € million H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012 Underlying tax charge 43 47 56

• 30%
• 19%

Effective tax rate 20% 20% 18% Non-controlling interests € million H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012 Profit attributable to non- controlling interests 24 11 15 38%

• 36%

% of underlying profit 9% 4% 4%

32

Special items

Operating special items - €81 million loss

 Consumer packaging (€13 million loss)

 Closure of Lindlar operation, volumes redirected to other operations

 Uncoated fine paper (€50 million loss)

 Restructuring activities and asset impairment in Neusiedler

 South Africa division (€18 million loss)

 Closure of one Newsprint machine and related restructuring

Cash effect of €26 million

33

1,872 (560) 129 75 92 50 68 187 (41) (28) 1,844 500 1 000 1 500 2 000 2 500

Cashflow effects – movement in net debt

Movement in net debt

* Before working capital outflow

Cash generated by

• perations*

Income tax paid Dividends paid to equity holders Capex and investment in forestry assets Other Financing costs paid Net debt at 31 Dec 2012 Net debt at 30 Jun 2013 Movement in working capital Dividends paid to non- controlling interests Currency movements

34

Working capital

 Increase in working capital as a percentage of turnover is driven largely by

 Seasonal pick-up  Change in business mix following acquisition of Nordenia (working capital as a % of

revenue excluding Nordenia in H1 2013 is 12.4%)

716 764 871

12.7% 11.9% 13.0%

H1 2012 H2 2012 H1 2013

€ million Working capital as a % of revenue

(105) 22 (129)

H1 2012 H2 2012 H1 2013

€ million

Working capital cash flows Working capital management

12% 10%

35

113 190 167

68% 102% 89%

H1 2012 H2 2012 H1 2013

€ million Capital expenditure incl. intangible assets Capex as a % of depreciation & amortisation

Capital expenditure

 Major expansionary projects progressing

according to plan

 Energy investments at Frantschach,

Richards Bay and Stambolijski mills will be completed in H2 2013

 Štěti bleached kraft paper project on track

for H1 2014 start-up

 Ružomberok recovery boiler start-up in H2

2014

 Capex to depreciation expected to average

±125% in 2013/2014

Capital expenditure

36

47% 16% 14% 9% 15%

Euro Russian rouble Polish zloty South African rand Other

Debt facilities

 Public credit ratings reaffirmed

 Standard & Poor’s at BBB-  Moody’s Investor Services at Baa3

€ million H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012

Net debt 1,257 1,872 1,844 47%

• 1%

Committed facilities 1,795 2,606 2,598 45%

• Of which undrawn

584 762 743 27%

• 2%

Gearing (Net debt / Trading capital employed) 31% 40% 40% Net debt / 12 month trailing EBITDA (times) 1.4 2.0 1.8

Currency split of net debt €1,844 million

37

2.50 3.50 8.25 8.90 9.55 7.00 16.50 17.75 19.10

5 10 15 20 25 30 2009 2010 2011 2012 2013

€ cents per share Interim dividend Final dividend

Dividends

 Interim dividend of 9.55 € cents per share declared, 7% up on prior year

Dividends declared

38

Abridged income statement 1

1 Excluding special items 2 Comparatives are restated to consolidate Mondi Shanduka Newsprint and account for Aylesford on the equity method, both previously proportionately consolidated

€ million H1 20122 H2 20122 H1 2013 % change vs H1 2012 % change vs H2 2012

Group Revenue 2 819 2 971 3 342 19% 13% Materials, energy and consumables used (1 478) (1 546) (1 758) Variable selling expenses (266) (261) (282) Gross margin 1 075 1 164 1 302 21% 12% Maintenance and other indirect expenses (123) (156) (122) Personnel costs (409) (425) (484) Other net operating expenses (106) (93) (142) Underlying EBITDA 437 490 554 27% 13% Depreciation and amortisation (165) (188) (188) Underlying operating profit 272 302 366 35% 21% Net income from associates (1) (4) 1 Net finance costs (55) (55) (57) Profit before tax 216 243 310 44% 28% Taxation charge (43) (47) (56) Profit for the period from continuing operations 173 196 254 47% 30% Non-Controlling Interest (24) (11) (15) Underlying earnings 149 185 239 60% 29%

39

100 200 300 400 500 600 Pulp Paper Wood Recovered paper Energy Chemicals Other Variable costs H1 2012 H2 2012 H1 2013

Input costs

 Lower average input costs per unit for the year  Total costs increased due to Nordenia acquisition

Variable costs Nordenia H2 2012 Nordenia H2 2013

€ million

40

100 200 300 400 500 600 700 800 900 1 000 H1 2012 H2 2012 H1 2013

Fixed costs

Personnel costs Depreciation and amortisation Maintenance and other indirect costs Other net operating expenses Fixed costs excl. depreciation as a % of turnover 22.6% 22.7% 22.4%

€ million

Fixed costs composition

Strong cost management limits cost increases to below inflation

41

Cash flow

1 Includes net debt assumed and the impact of the acquisition of non-controlling interests 2 Includes net debt disposed of

€ million H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012

Underlying EBITDA 437 490 554 27% 12% Working capital movements (105) 22 (129) Other operating cash flow items 23 (18) 6 Cash generated from operations 355 494 431 21%

• 13%

Dividends from financial investments and associates 2 Taxes paid (45) (64) (75) Net cash inflow from operating activities 310 432 356 15%

• 18%

Capital expenditure, excl. intangible assets (110) (184) (164) Investment in forestry assets (30) (21) (20) Acquisitions¹ (384) (814) Disposals² 1 (17) 3 Dividends paid (114) (43) (142) Other investing and financing activities 143 671 (13) Net (decrease)/increase in cash (183) 23 17

42

Statement of financial position

€ million H1 2012 H2 2012 H1 2013 Intangible assets 243 695 684 Property, plant & equipment 3 431 3 709 3 446 Forestry assets 318 311 257 Other non-current assets 55 42 41 Total non-current assets 4 047 4 757 4 428 Inventories 663 783 767 Trade and other receivables 927 1 010 1 112 Other current assets 70 73 111 Total current assets 1 660 1 866 1 990 Total assets 5 707 6 623 6 418 Short-term borrowings (294) (281) (265) Trade and other payables (874) (1 029) (1 008) Other current liabilities (120) (137) (148) Total current liabilities (1 288) (1 447) (1 421) Medium and long-term borrowings (1 023) (1 648) (1 664) Retirement benefits obligation (217) (253) (225) Deferred tax liabilities (319) (344) (291) Other non-current liabilities (49) (58) (53) Total non-current liabilities (1 608) (2 303) (2 233) Total liabilities (2 896) (3 750) (3 654) Net assets 2 811 2 873 2 764 Retained earnings and other reserves 1 973 2 030 1 963 Total attributable to equity holders of the parent companies 2 515 2 572 2 505 Non-controlling interests in equity 296 301 259 Total equity 2 811 2 873 2 764

43

1 Delivered to Frankfurt except where noted 2 Includes specialties 3 Delivered to Rotterdam, best estimate based on current exchange rates 4 Excludes kraftliner substitutes Source: RISI and Mondi estimates

Emerging market asset base leads to low cost positions across the Group’s main grades…

100% 100% 100% 75% 20% 35% 100% 25% 18% 38% 62% 20% 18% 12% 7% White Top Kraftliner Unbleached Kraftliner NSSC Fluting Recycled fluting Unbleached Sack Kraft Paper UFP² BHKP (Pulp)³ Percentage of Mondi's capacity in overall cost curve in Q1 2013

Q4 Q3 Q2 Q1

4

Cost quartile¹

44

0.4 0.3 0.1

Production Consumption Net long position

Millions

• f tonnes

0.7 0.1 0.6 0.1 0.1

Production Consumption Net long/(short) position

Millions

• f tonnes

0.5 0.3 0.2

Production Consumption Net long position

Millions

• f tonnes

1.6 1.8 (0.2) 0.4 0.1 0.3

Production Consumption Net long/(short) position

Millions

• f tonnes

Integrated value chain H1 2013

Kraft Paper Pulp Virgin Containerboard1 Recycled Containerboard1

MSAD E&I MSAD E&I E&I E&I

1 ±200 kt of kraftliner substitutes included in virgin containerboard, previously included in recycled containerboard

45

Production volumes

H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012 Europe & International Containerboard Tonnes 1 042 937 1 036 067 1 077 702 3%

4%

Kraft Paper Tonnes 489 279 491 358 515 822 5%

5%

Corrugated Board & Boxes m m2 606 607 678 12%

12%

Industrial Bags m units 2 005 1 824 2 017 1%

11%

Consumer Packaging Tonnes 36 706 84 420 146 763 >100%

74%

Coatings & Release liners m m2 1 758 057 1 594 239 1 717 653

• 2%

8%

Uncoated Fine Paper Tonnes 715 575 702 134 708 880

• 1%

1%

Newsprint Tonnes 98 936 102 342 103 620 5%

1%

Total hardwood pulp Tonnes 527 310 531 830 547 819 4%

3%

Total softwood pulp Tonnes 992 772 985 811 1 014 483 2%

3%

South Africa Containerboard Tonnes 132 251 131 217 132 077 0%

1%

Uncoated Fine Paper Tonnes 129 337 128 410 131 741 2%

3%

Total hardwood pulp Tonnes 330 963 327 405 326 981

• 1%

0%

Total softwood pulp Tonnes 108 126 107 178 102 987

• 5%
• 4%

Newsprint Tonnes 101 328 96 696 87 088

• 14%
• 10%

46

Exchange rates

H1 2012 H2 2012 H1 2013 % change vs H1 2012 % change vs H2 2012

Closing rates against the euro South African rand 10.37 11.17 13.07 26% 17% Czech koruna 25.64 25.15 25.95 1% 3% Polish zloty 4.25 4.07 4.34 2% 7% Pounds sterling 0.81 0.82 0.86 6% 5% Russian rouble 41.37 40.33 42.84 4% 6% Turkish lira 2.28 2.36 2.52 11% 7% US dollar 1.26 1.32 1.31 4%

• 1%

Average rates for the period against the euro South African rand 10.29 10.55 12.10 18% 15% Czech koruna 25.16 25.14 25.70 2% 2% Polish zloty 4.24 4.18 4.18

• 1%

0% Pounds sterling 0.82 0.81 0.85 3% 5% Russian rouble 39.69 39.91 40.73 3% 2% Turkish lira 2.34 2.31 2.38 2% 3% US dollar 1.30 1.29 1.31 1% 2%