Debt Investor Presentation 1Q 2014 13.5. 2014 Mets Board Mets - - PowerPoint PPT Presentation

Metsä Group

Metsä Board

Debt Investor Presentation 1Q 2014

13.5. 2014

Metsä Group

Metsä Board

Successful Early Refinancing Completed in 1Q 2014

‒ The new unsecured financing package consists of

‒ EUR 225 million bond issue at coupon of 4 per cent (over 10 times oversubscribed) ‒ EUR 150 million term loan ‒ EUR 100 million revolving credit facility

‒ Gross debt EUR 721 million, cash and interest bearing receivables EUR 129 million and net debt EUR 593 million ‒ Net gearing 69%, equity ratio 41% and average interest rate 4.3% at the end of 1Q 2014 ‒ Lielahti real estate in Finland was divested for EUR 26 million. EUR 19.7 million was paid for UPM based on the Court of Arbitration’s judgment

Net Debt, m€

2403 593 500 1000 1500 2000 2500 3000 2006 2007 2008 2009 2010 2011 2012 2013 1Q14

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Metsä Group

Metsä Board

Loans and Interest Rate

At the end of 1Q 2014 ‒ Average maturity of long term loans 3,9 years ‒ Average interest rate of loans (including derivatives) 4,3 % ‒ Interest rate maturity of loans (including derivatives) 33,8 months ‒ Of the loans about 26 per cent was subject to variable interest rates and 74 per cent to fixed interest rates

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Metsä Group

Metsä Board

Diversified Funding Sources

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Long-Term Interest Bearing Liabilities 31.3. 2014

31 % 8 % 3 % 28 % 30 % Bonds Pension premium loans Loans from financial institutions Finance leases Other interest bearing liabilities

Solid liquidity position with 100m€ RCF fully undrawn and 121 m€ of cash and cash equivalent at the end

• f 2013. Additionally, 150 m€ reserve in form of Metsä Group's internal undrawn short-term credit facility

Metsä Group

Metsä Board

Interest Bearing Net Liabilities 31.3.2014

‒ Long-term 716 ‒ Short-term 5 Total interest bearing liabilities 721 ‒ Liquidity and interest bearing receivables 128 Interest bearing net liabilities 593

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m€

Metsä Group

Metsä Board

Well Balanced Maturity Schedule

44 94 34 83 181 253 24 4 100 14 50 100 150 200 250 300 2014 2015 2016 2017 2018 2019 2020 >2 020 Long-term interest bearing liabilities Committed undrawn credit facilities

m€

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Long-term Interest Bearing Liabilities and Committed Undrawn Credit Facilities 31.3.2014

Metsä Group

Metsä Board

41,0 33,3 32,4 38,7 40,7 5 10 15 20 25 30 35 40 45

1Q13 2Q13 3Q13 4Q13 1Q14

69 70 75 74 69 10 20 30 40 50 60 70 80

1Q13 2Q13 3Q13 4Q13 1Q14

Balance Sheet Ratios

Equity Ratio Net gearing

% %

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Metsä Group

Metsä Board

Debt Programs 31.3.2014

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The following table sets forth the significant debt securities issued and outstanding of Metsä Board as at March 31, 2014 Average Long-term borrowings Total amount Outstanding I nterest Rate * ) Maturity EUR 225 million Bond Issue 2014 EUR 225 EUR 225 4,5 % 2019 Syndicated credit facility 2014 EUR 250 EUR 150 5,0 % 2018 EUR 107 million bilateral loans EUR 107 EUR 107 3,6 % 2014-2017 EUR 24 million finance leases EUR 24 EUR 24 2,3 % 2014-2020 EUR 231 million pension loans EUR 231 EUR 217 4,0 % 2014–2020 *) The average interest rate take into account outstanding interest rate swaps and amortised arrangement fees. Average interest rate of all Metsä Board interest bearing liabilities including interest rate derivatives per 31.3.2014 is 4,3 %. The following table sets forth Metsä Board´s principal long-term liquidity reserves as at March 21, 2014: Average Liquidity reserves Total amount Outstanding I nterest Rate * ) Maturity (EUR in millions) Revolving Credit Facility 2014 EUR 100 EUR 0 – 2018 Pension loan facilities EUR 231 EUR 217 4,0 %

• Short-term funding programmes

Metsä Group internal short-term limit EUR 150 EUR 0 – 0-12 months Metsä Group Treasury funding programmes: EUR 150 million domestic CP-program EUR 150 EUR 14 0,4 % 0-12 months (currency in millions)

Metsä Group

Metsä Board

Ratings’ History

2000 S&P: Short term ratings lowered to A3, Long term ratings placed to credit watch negative Moody’s: Long and short term ratings

• utlook changed from stable to negative

2001 S&P: Long term ratings lowered to BBB-, stable outlook Moody’s: Long and short term ratings lowered to Baa3/P3, negative outlook 2003 S&P: Downgrade to BB+, stable outlook Moody’s: Downgrade to Ba1, negative

• utlook

2004 S&P: Outlook changed from stable to negative, ratings affirmed Moody’s: Downgrade to Ba2, stable outlook 2005 S&P: Downgrade to BB, stable outlook Moody’s: Outlook changed from stable to negative, ratings affirmed 2006 S&P: Downgrade to BB-, negative outlook Moody’s: Downgrade to Ba3, negative outlook Moody’s: Downgrade to B2, negative outlook S&P: Downgrade to B+, negative outlook 2007 Moody’s: Downgrade to B3, negative outlook S&P: Downgrade to B, negative outlook S&P: Downgrade to B-, stable outlook 2008 S&P: Outlook to negative 2009 S&P: Downgrade to CCC+, negative outlook Moody’s: Downgrade to Caa1, outlook negative 2010 S&P: Outlook to stable Moody’s: Outlook to stable S&P: Upgrade to B-, stable outlook Moody’s: Upgrade to B3, outlook to positive 2011 S&P: Outlook to positive S&P: Outlook to stable Moody’s: Outlook to stable 2012 Moody’s: Outlook to positive 2013 S&P: Outlook to positive Moody’s: Upgrade to B2, outlook stable S&P: Upgrade to B, outlook stable Moody’s: Outlook to positive

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Metsä Group

Metsä Board

Positive Rating Development

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Moody’s Standard & Poor’s

2005 2006 2007 2008 2009 2010 2011 2012 2013

BB+ | Ba1 BB | Ba2 BB- | Ba3 B+ | B1 B | B2 B- | B3 CCC+ | Caa1 CCC | Caa2

Stable Positive

Metsä Group

Metsä Board

Thank You!

www.metsaboard.com Juha Laine

Headof IR +358 10 4654335 juha.laine@metsagroup.com