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strategy for profitable growth Kemira Capital Markets Day 2017 - - PowerPoint PPT Presentation

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September 21, 2017 Capital Markets Day Kemira progressing our strategy for profitable growth Kemira Capital Markets Day 2017 Program (UK time): 11.00 Registration & breakfast 11.30 President & CEO: Jari Rosendal Pulp & Paper: Kim

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SLIDE 1

Kemira – progressing our strategy for profitable growth

Capital Markets Day

September 21, 2017

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SLIDE 2

Kemira Capital Markets Day 2017

11.00 Registration & breakfast 11.30 President & CEO: Jari Rosendal Pulp & Paper: Kim Poulsen Industry & Water: Antti Salminen 12.45 Lunch 13.20 Oil & Gas: Pedro Materan Sourcing: Thierry Blomet CFO: Petri Castrén 14.35 Coffee break 14.50 Breakout sessions with the management (three groups) 16.05 Cocktails 17.00 End Program (UK time):

Jari Rosendal President and CEO Petri Castrén CFO Kim Poulsen President, Pulp & Paper Antti Salminen President, Industry & Water Thierry Blomet SVP, Sourcing Pedro Materan SVP, Oil & Gas

September 21, 2017 Capital Markets Day 2

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SLIDE 3

Today’s speakers

Jari Rosendal

President and CEO with Kemira since 2014 Key prior positions:

  • Outotec

– Member of the Executive Board – Executive Vice President, President of Americas Region – President, Non‐ferrous Solutions Business Area – President, Minerals Processing Division

  • Relevant positions of trust:
  • Chemical Industry Federation of Finland

– Member of the Board of Directors

  • European Chemical Industry Council (CEFIC)

– Member of the Board of Directors

Petri Castrén

CFO with Kemira since 2013 Key prior positions:

  • Nokia Siemens Networks

– Head of Corporate Finance (Group Treasurer) – Head of Corporate Development

  • Nokia Corporation

– Head of Mergers & Acquisitions – Various finance and business development management roles

September 21, 2017 Capital Markets Day 3

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SLIDE 4

Today’s speakers

Kim Poulsen

President, Segment Pulp & Paper with Kemira since 2015 Key prior positions:

  • UPM-Kymmene

– Paper Asia, EVP and Group Executive Team Member – Head of APAC, EVP and Group Executive Team Member – Senior Vice President, Plywood business

  • Vitalis Gladius

– Owner and Senior Partner

  • Paloheimo Group and Fenestra

– President and CEO

  • Finnforest

– Several management roles

Antti Salminen

President, Segment Industry & Water with Kemira since 2011 Key prior positions:

  • Kemira

– Executive Vice President, Supply Chain Management

  • KONE

– Director, New Equipment Business, Asia Pacific – Vice President, Delivery Process

  • Capgemini Finland

– Managing Consultant

September 21, 2017 Capital Markets Day 4

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SLIDE 5

Today’s speakers

Pedro Materan

SVP, Global Oil & Gas, Industry & Water with Kemira since 2006 Key prior positions:

  • Kemira

– SVP, RBU Oil & Mining, Americas – Global Business Development and Global Sales Manager, Oil and Gas

  • Cytec Industries

– Global Marketing Manager for Oilfield – Sales Manager, Americas for Phosphine Chemicals (Oil, Mining and Textiles) – Regional Technical Sales Manager for Water Treatment – Sales Rep for Water Soluble Polymers

Thierry Blomet

SVP, Sourcing with Kemira since 2013 Key prior positions:

  • PPG

– Director, Raw Material Purchasing EMEA – Director, Indirect Purchasing EMEA – Business Director – Industrial Finishes Europe

  • Dupont

– Business Director – Coatings for mass production industry

September 21, 2017 Capital Markets Day 5

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SLIDE 6

Kemira – progressing our strategy for profitable growth

Capital Markets Day

Jari Rosendal, President and CEO September 21, 2017

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SLIDE 7

GEOGRAPHIES SEGMENT SPLIT PRODUCTS

Kemira in brief

FY2016: Revenue EUR 2,363 billion, Operative EBITDA EUR 302.5 million, margin 12.8%

25% Bleaching

and pulping

20%

Polymers

20% Other:

e.g. defoamers, dispersants, and biocides

20%

Coagulants

15% Sizing

and strength

Revenue by product category rounded to the nearest 5%

38%

AMERICAS 1.USA 2.Canada 3.Brazil

52%

EUROPE 1.Finland 2.Sweden 3.Germany

10%

APAC 1.China 2.Indonesia 3.South Korea

62%

Pulp & Paper

38%

Industry & Water

CUSTOMERS 8,000 Sold-to customers 16,000 Ship-to customers Examples of largest customers

September 21, 2017 Capital Markets Day 7

#1 in water treatment in NA and Europe #1 in shale in NA #1 globally London New York City Frankfurt Paris Shanghai Singapore Municipalities, e.g.

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SLIDE 8

Our targets and actions for profitable growth

September 21, 2017 Capital Markets Day 8

ORGANIC GROWTH

  • Investments in capacity expansion
  • Seize opportunities in growth pockets
  • Shale oil & gas business
  • CEOR and oil sands
  • Digitalization
  • APAC
  • R&D, new products

ACQUISITIONS

Very selective approach

  • Strategic and synergistic fit
  • Accretive to profitability
  • Reasonable valuation

EFFICIENCY

  • Manufacturing footprint

and utilization optimization

  • BOOST – Operational

excellence

  • Organizational efficiencies

with new structure

  • Complexity reduction
  • Efficient processes

OPERATING COST DISCIPLINE

Prudent cost culture

Above-the-market growth and operative EBITDA of 14-16%

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SLIDE 9

Expansion of pulp chemicals, Oulu (FI)

Progress in profitable growth

September 21, 2017 Capital Markets Day 9

Acquisition Opening / expansion of site Operational efficiencies

Opening of Tarragona coagulant site (ES) Acquisition BASF AKD emulsion business Opening of EMEA service center Expansion of dry and emulsion polyacrylamide (US) Opening of Nanjing (CN) site Closure of Longview (US) AkzoNobel’s paper chemicals acquisition Acquisition of Soto Industries (US) Closure of Soave (IT) Start-up of Ortigueira (BR) sodium chlorate site and announcement of Joutseno (FI) expansion Acquisition

  • f Polymer

Services (US) Botlek (NL) modernization BOOST operational excellence program launch Bradford (UK) expansion San Giorgio (IT) expansion Closures of Ottawa (CA) and Zaramillo (ES)

Closure of site

Q4 16 Transportation agreement with Odyssey Q1 17 Odyssey go-live in North America Two segment structure

  • perational

Q2 17 Q3 16 Q1 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q2 14

11.3%

2013 operative EBITDA

12.8%

2016 operative EBITDA Q3 17 Start-up of Joutseno (FI) chlorate expansion

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SLIDE 10

Kemira has managed to improve EBITDA even with the downturn in the O&G market

Revenue

2229 2137 2373 2363 2420 2013 2014 2015 2016 LTM

Operative EBITDA and

  • perative EBITDA margin

September 21, 2017 Capital Markets Day 10

EUR million EUR million

252 253 287 303 297

11.3% 11.8% 12.1% 12.8% 12.3%

2013 2014 2015 2016 LTM

Between 2014-2016, Oil & Mining revenue and operative EBITDA dropped EUR 70 million and EUR 30 million respectively

LTM = Last Twelve Months ending June 2017

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SLIDE 11

Kemira’s relevant market expected to show healthy growth

Long-term drivers for growth, including:

  • E-commerce drives the need for packaging material
  • Growing middle class, increased standards of living

and urbanization leads to higher usage of water, energy, tissue, and board

  • Recycling and use of renewables leads to e.g. higher

usage of strength chemicals

  • Regulation increases water treatment
  • Scarcity of resources accelerates need to produce

more with less

Challenges

  • Risks to global GDP growth
  • Decline in demand for printing and writing paper

demand

2017 2022

Market growth by business areas: Pulp & Paper 1%, Water treatment 2-3%, Oil & Gas 5-6% p.a.

September 21, 2017 Capital Markets Day 11

2-3% 3-4%

CAGR 2017-2022 ~20 ~23 +3%

2-3%

Management estimation based on various sources

Americas EMEA APAC Relevant target market (EUR billion)

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SLIDE 12

APAC is driving future market growth

  • APAC market is the largest and fastest

growing market

  • Our business in APAC has been growing and

EBITDA turned to positive after 2014

– New greenfield manufacturing site in Nanjing, China in 2014 and acquisition of AkzoNobel’s paper chemicals in 2015 have helped to improve profitability – We are market leader in Pulp & Paper with ~10% market share – Industry & Water continue to grow, albeit from small base

September 21, 2017 Capital Markets Day 12 * H1 2017 annualized

2011 2013 2015 H1 2017* 2011 2013 2015 H1 2017* Operative EBITDA Revenue

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SLIDE 13

We innovate for the future through customer collaboration, partnerships and open innovation. We use digitalization to improve our own performance as well as the services offered to customers. 250 R&D experts create new innovations in R&D centers in Finland, China and US. 348 patent families Over 1,200 patents

Innovation drives growth – EUR 220 million revenue from recent innovations

25% Bleaching

and pulping

20%

Polymers

20% Other:

e.g. defoamers, dispersants, and biocides

20%

Coagulants

15% Sizing

and strength

Products EUR 2.4bn

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SLIDE 14

Innovation sales on track – pipeline strong

Sales from new products (launched within the last 5 years)

Best selling new products in 2016

  • 1. Oil & Gas – Freeze

tolerant friction reducer

  • 2. Oil & Gas –

Stabilizing additives for CEOR polymers

  • 3. Pulp & Paper –

Strength for tissue

September 21, 2017 Capital Markets Day 14

5% 7% 8% 8% 9% 50 100 150 200 250 300 2012 2013 2014 2015 2016

  • f Group’s revenue from new products
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SLIDE 15

BOOST update - targeting EUR 20-30 million of savings and EUR 50 million of inventory reduction

2,300

products

63

manufacturing sites

13,000

suppliers

200

warehouse locations

16,000

ship-to- customers

250,000

  • rders per

year

BOOST is about improving competitiveness through efficiency Majority of savings will result from logistics

  • Kemira spends annually

around EUR 170 million on road transportation

  • Sourcing of logistics by

Odyssey expected to yield significant savings of road transportation cost

  • Odyssey roll-out done in

North America in April and Europe to follow

Distribution center Kemira Supplier Customer Kem Connect Customer Service

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SLIDE 16

Our key actions to improve margins

2015 2016 2017 LTM Acquisition synergies Group Pulp & Paper BOOST -

  • perational

excellence Industry & Water Industry & Water Industry & Water Volatility Mid- to long-term target

September 21, 2017 Capital Markets Day 16

12.3% Operative EBITDA margin 14-16%

New bleaching chemical capacity (Joutseno, Finland) Optimization

  • f operations:

majority of savings in logistics Oil sands Chemical Enhanced Oil Recovery

12.1%

Efficiencies from new two segment structure

12.8%

Estimated end of 2017 run-rate 100% 100% 75% Low 25% Low Low Full run-rate by EO 2017 EO 2017 2018 1-2 yrs 2-3 yrs 2-5 yrs 3-5 yrs

AkzoNobel’s paper chemicals business Advanced Water Treatment Market and raw material related volatility

LTM = Last Twelve Months ending June 2017

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SLIDE 17
  • Our first priority is safety of employees and we are happy

to report that everyone is safe

  • Multiple oil refineries and chemical providers impacted

short-term by consequences of flooding

  • Only limited short-term direct impact on Kemira

– Our assets were not damaged – Customer operations not materially impacted

  • Indirect impact also limited – full recovery depends on

normalization of supply chain

– Availability of raw materials partially limited – Disruptions in logistics

Hurricanes Harvey and Irma impacting chemical industry

September 21, 2017 Capital Markets Day 17

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SLIDE 18

Primary business / company (primary region) Board and paper chemicals / Soto (Canada) Q3/2013 Polymer manufacturer / 3F (global) Q4/2013 Board and paper chemicals / BASF AKD (Europe) Q2/2014 Board and paper chemicals / Akzo Nobel (global) Q2/2015 Board and paper chemicals / Soto (US) Q3/2015 Oil field services / Polymer Services (US) Q4/2015

Selective acquisitions possible if strategic fit and financials reasonable

Acquisition criteria

  • Must improve operative EBITDA margin in second full year after

closing

  • Must be synergistic and strengthen market position and/or our

competencies

September 21, 2017 Capital Markets Day 18

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SLIDE 19
  • Investments done in profitability enhancing growth areas

– New chlorate plant in Brazil 2016 – New chlorate line in Finland in 2017 – Capacity additions related to AkzoNobel acquisition – Polymer capacity additions

  • Balanced cash flow and capex

– Good maintenance capex control – Prudent strategic prioritization of investments – Optional investments / M&A in profitable growth areas – Net working capital optimization

Balanced cash flow and capex

September 21, 2017 Capital Markets Day 19

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SLIDE 20

Progressing our strategy for profitable growth

GROUP’S MID- TO LONG-TERM TARGETS

Above-the-market growth Operative EBITDA 14-16% Gearing below 60%

Dividend policy: stable and competitive dividend

Balanced cash flow and capex Increase efficiency Grow by investing, innovating and capturing market opportunities

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SLIDE 21

Pulp & Paper – driving growth as market leader

Capital Markets Day

Kim Poulsen, President, Pulp & Paper September 21, 2017

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SLIDE 22

REVENUE BY PRODUCT CATEGORY REVENUE BY CUSTOMER TYPE AND MARKET GROWTH REVENUE AND OPERATIVE EBITDA

Pulp & Paper – market leader with solid track record

September 21, 2017 Capital Markets Day 22 Note: Revenue by industry, product and geography rounded to the nearest 5%

MARKET ENVIRONMENT REVENUE BY GEOGRAPHIES AND MARKET GROWTH BY REGION CUSTOMER EXAMPLES

1047 1068 1170 1417 1457 109 130 137 171 195 2012 2013 2014 2015 2016

35%

Americas

50%

EMEA

15%

APAC

35%

Bleaching & pulping

25%

Sizing & strength

20%

Defoamers, dispersants, biocides and other process chemicals

10%

Polymers

10%

Other

40%

Pulp

20%

Printing & writing papers

40%

Board & tissue

  • 1-2%

2-3% 1-2% Market growth 2-3% 0-1% 0-1% Market growth

AkzoNobel (pulp) #4 BASF (paper) #2 Solenis (paper) #3 Kemira (pulp and paper) #1 Ecolab (paper) #5

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SLIDE 23

Customer interview with UPM

2016 CMD

  • UPM was one of our TOP 5 clients
  • Jyrki Ovaska EVP, Technology at UPM

interviewed by video

  • Mr. Ovaska’s feedback about UPM’s business

relationship with Kemira

– Kemira’s international footprint matches UPM’s locations – Comprehensive product portfolio is attractive – Further potential for Kemira to increase share

  • f UPM’s business

– Request for more collaboration to find new innovations and efficiencies

2017 CMD

  • UPM is now one of our TOP 3 clients
  • Mr. Ovaska’s feedback regarding change

from 2016 to 2017 visible on video

September 21, 2017 Capital Markets Day 23

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SLIDE 24

Our winning formula to continue growth

September 21, 2017 Capital Markets Day 24

Above-the-market growth and operative EBITDA 14-16%

Improve customer experience Maximize capacity utilization Manage fixed costs Invest in growth and R&D

  • Capacity additions
  • 9 new products in 2016
  • New mgmt. structure
  • Employee engagement –

15/16 survey items improved since 2015

  • TOP 50 customers are EUR 1bn
  • Customer satisfaction to 98%
  • Bleaching ran flat out 9 years
  • Paper chemicals varying
  • H1 2017 business overheads

below 2016 level

  • Group: 240 products out
  • Target to reduce by 200 in 2017

Reduce complexity Enhance performance culture

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SLIDE 25

Board and paper production shifting to emerging markets

Growth of board and paper production by region 2015-2030

  • 55mt growth in APAC by

2030

BIGGEST PRODUCERS ARE: China, USA, Japan, Germany, India, Sweden, Korea, Canada, Finland, Brazil BIGGEST GROWTH AREAS ARE: China, India, Indonesia, Brazil, Russia, Vietnam

North America 2015: 82 mt 2030: 75 mt Latin America 2015: 21 mt 2030: 31 mt

  • W. Europe

2015: 85 mt 2030: 78 mt

  • E. Europe

2015: 18 mt 2030: 26 mt China 2015: 106 mt 2030: 139 mt Africa 2015: 4 mt 2030: 6 mt Oceania 2015: 4 mt 2030: 4 mt Japan 2015: 26 mt 2030: 21 mt Rest of Asia 2015: 55 mt 2030: 82 mt

TOTAL BOARD & PAPER PRODUCTION: 2015: 402 million tons 2030: 461 million tons CAGR%: around 1 % / annum

Source: Pöyry

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SLIDE 26

Strong market positions and strategic investments

REGION MARKET POSITION GROWTH TREND GROWTH STRATEGY

EMEA North America APAC South America #1 #2/3 #1 #3 Exceptional customer experience Transformation from paper to board Continue to grow with major players (TCM) and assess future investments Assess future bleaching investments

TCM = Total Chemistry Management

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SLIDE 27

Market position strengthened through successful acquisition

  • AkzoNobel’s paper chemicals acquired

in May 2015

– Target initially EUR 15 million – Run-rate ahead of plan, close to EUR 20 million

  • Acquisition strengthened our position

especially in APAC

– 4 of 6 sites acquired were in APAC

  • APAC capacity addition in Nanjing,

China executed well and ramping up according to plan

September 21, 2017 Capital Markets Day 27

Hallam – Australia Pasuruan – Indonesia Wellgrow – Thailand Gunsan – Korea Nanjing – China Yanzhou – China Acquired site Kemira site

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SLIDE 28

We have become market leader in APAC

Pulp & Paper relevant chemicals market 2017

EUR million

  • Board and paper production in APAC

will be bigger than Europe and North America combined by 2020

  • >90% of global board and paper

production growth in APAC

  • Kemira now #1 with close to 10%

share in APAC

– Revenue doubled to around EUR 200 million in 3 years

  • Fragmented market provides good

potential for profitable growth

  • Continue to grow revenue and market

share

2000 4000 6000 South America APAC North America EMEA

September 21, 2017 Capital Markets Day 28

0-1%

  • 1-0%

2-3% 2-3% CAGR 2017- 2022

Source: Pöyry, management estimation

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SLIDE 29

Strong demand in pulp market creating growth

  • pportunities
  • New pulp mill projects are driven by

increasing demand for board and tissue

– Food and liquid packaging board is growing particularly fast in Asia – Pulp is produced close to wood sources and then shipped to board, paper, and tissue mills – Growth in board = 1 new pulp mill per year

  • Multiple pulp mill projects realised and

expected in Northern Europe creating

  • pportunities for Kemira to grow with

the market

  • In addition, a few large scale pulp mill

projects expected in South America

September 21, 2017 Capital Markets Day 29

Confirmed new capacity / debottlenecking 2016-2020 Possible new mills 2020-2022

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SLIDE 30

Successful value creating investments – case Joutseno

Kemira bleaching chemicals revenue growth

  • Kemira’s capacity in sodium chlorate was fully

utilized, hence the need for additional capacity

  • Capacity doubled in Joutseno with around

EUR 50 million investment

  • Investment realized according to budget and

start-up was ahead of schedule in early September 2017

  • Targeting maximum capacity utilization by

H2 2018

– Part of the production will be shipped to APAC to support the growth in the region

2014 2015 2016 2017 H1 ann.

September 21, 2017 Capital Markets Day 30

+7% +10% +5% +3% +6%

CAGR

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SLIDE 31

Industry & Water – stronger platform for profitable growth

Capital Markets Day

Antti Salminen, President, Industry & Water September 21, 2017

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SLIDE 32

Industry & Water – stronger platform for profitable growth

  • Profitable and stable underlying

business

  • New structure creates growth

and efficiency opportunities

  • Innovation supporting growth

in selected areas

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SLIDE 33

MARKET POSITION

220 227 231 228 238 248 Q1 Q2 Q3 Q4 Q1 Q2

REVENUE BY PRODUCT CATEGORY REVENUE BY APPLICATION TYPE AND MARKET GROWTH

Industry & Water – strong positions in chosen categories

Note: Revenue by industry, product and geography rounded to the nearest 5%

REVENUE AND ORGANIC GROWTH (Y-O-Y)

EUR million

Capital Markets Day 33

REVENUE BY GEOGRAPHIES AND MARKET GROWTH BY REGION CUSTOMER EXAMPLES 45%

Coagulants

35%

Polymers

20%

Other products such as defoamers and biocides 2-3% 5-6% 2-3% Market growth

September 21, 2017

40%

Americas

55%

EMEA

5%

APAC

70%

Water treatment

15%

Other

15%

Oil & Gas

5-6% 3-4% 3-4% Market growth

Municipal (40%),

customer examples Amsterdam Barcelona Frankfurt London Oslo Paris Stockholm Los Angeles Montreal New York City Toronto Melbourne Shanghai Singapore

Industrial (60%),

customer examples

Market share in water treatment in Europe and North America Market share in polymers used for friction reduction in US shale fracking

>30% 30%

  • 7%
  • 5%
  • 5%

0% +6% +9%

2016 2017

slide-34
SLIDE 34

REVENUE

EUR million 956 906 447 485 2015 2016 H1 2016 H1 2017 116 107 54 52 12.2% 11.8% 12.2% 10.8% 2015 2016 H1 2016 H1 2017

Returning to growth in 2017

  • In 2016, financials impacted by market

turmoil in shale industry

  • H1/17 revenue growth looks promising

– Growth +9%, driven by Oil & Gas – Volume growth in water treatment +2%

  • Profitability was impacted by higher raw

material prices

  • Profitable growth opportunities:

– Selected applications within Oil & Gas, such as CEOR and oil sands, as well as shale fracking – Advanced Water Treatment (AWT) – Water treatment in APAC

Capital Markets Day 34

+9%

OPERATIVE EBITDA AND OPERATIVE EBITDA MARGIN

EUR million

September 21, 2017

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SLIDE 35

New structure creates growth and efficiency opportunities

  • Leveraging the full potential of new combined

segment

– Full geographical reach in all regions – Global polymer expert network – Water treatment expertise for O&G and Mining

  • Structural change means faster decision making
  • More efficient development and roll-out of new

innovations

  • Important part of segment’s profitability improvement

– On Group-level cost savings EUR 15-20 million

Capital Markets Day 35

Oil & Mining Municipal & Industrial 70%

Water treatment

15%

Oil & Gas

Industry & Water

15%

Other applications

September 21, 2017

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SLIDE 36

REVENUE IN GROWTH INITIATIVES

EUR million

24 28 20 40 60 80 2015 2016 Water Treatment Oil & Gas

Profitable growth opportunities ahead...

  • H1 2017 showed good volume growth

– +2% in water treatment – Around +50% in Oil & Gas

  • Multiple initiatives ongoing to boost growth in both businesses

Capital Markets Day 36

BUSINESS AREA REGION GROWTH INITIATIVES IN 2015-2017

WATER TREATMENT EMEA Desalination BioGas Sludge dewatering Middle East and Africa NA Odor control Sludge dewatering APAC Deep sludge dewatering OIL & GAS GLOBAL CEOR Oil sands in Canada

+65%

September 21, 2017

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SLIDE 37

…fueled by strong innovation pipeline

Capital Markets Day 37

>20

Continuous ideas inflow

Projects under evaluation

Enhanced Oil Recovery

Projects under development and early commercialization Projected 10-yr NPV

8 2 3 12 1

EUR 650 million

AWT = Advanced Water Treatment

Oil sands Shale oil & gas Solid liquid separation (incl. AWT)

Sludge dewatering, nutrients recovery, mining processes

Desalination, re-use & disinfection

(incl. AWT)

2 3 12 1

September 21, 2017

# of projects

EUR 110 million, 12% of Industry & Water revenue from innovation in 2016

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SLIDE 38

The next generation of sludge treatment will focus on customer performance and value created KemConnect Smart Dewatering combines a complete chemicals portfolio, continuous chemistry optimization and real-time monitoring to a new business model

Dewatering Today Smart Dewatering Tomorrow

Innovation case – KemConnect Smart Dewatering

ADVANCED WATER TREATMENT CASE EXAMPLE

Disposal Cost KemConnect Service Fee Disposal Cost Customer Net Savings Chemical Cost

slide-39
SLIDE 39

Stronger platform for profitable growth

  • Strengthened business in growing

market

  • New structure enables greater agility and

higher profitability

  • Profitable growth opportunities driven by

innovation

  • Oil & Gas returned to growth
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SLIDE 40

Oil & Gas – well positioned for growth in niche areas

Capital Markets Day

Pedro Materan, SVP, Oil & Gas September 21, 2017

slide-41
SLIDE 41

85%

  • f business

in polymers

200

Customers

Oil & Gas – small and focused team

Designed to extract more

September 21, 2017 Capital Markets Day 41

DESIGNED TO EXTRACT MORE

A unique combination

  • f innovative chemicals

and application knowledge that improves process efficiency and yield in

  • il & gas applications

152

Revenue in EUR million (LTM)

30

Global commercial team

75%

Revenue in Americas

90%

On upstream and in water related applications

LTM = Last Twelve Months ending June 2017

slide-42
SLIDE 42

KEMIRA OIL & GAS REVENUE

Resilient business set for growth

  • Growing market demand with our

selective market diversification assuring growth

  • Kemira’s offering

– Process efficiencies: polymers that reduce energy consumption by 60% in shale oil fields – Cost reduction: higher concentrated liquids that make offshore oil recovery more cost effective (CEOR) – Addressing environmental regulations: tailing treatment in oil sands

  • New innovative technologies driving

expansion

September 21, 2017 Capital Markets Day 42

25%

Other

50%

Shale fracking

25%

Oil sands and Chemical Enhanced Oil Recovery

Revenue EUR 152 m

(LTM) 50 100 150 200 2013 2014 2015 2016 LTM

+47%

in H1/17 Oil price

Figures rounded to closest 5%

LTM = Last Twelve Months ending June 2017

slide-43
SLIDE 43

Well positioned and growing into adjacent areas

New global organization concentrating on extraction areas

September 21, 2017 Capital Markets Day 43

Oil & Gas revenue Upstream Reaching Midstream Producing Downstream Transporting Downstream Processing 90% 90% 10% Area Oilfield Chemicals Oilfield Services MARKET POTENTIAL (AVAILABLE) Around €1.5bn Around €1bn APPLICATIONS Drilling Cementing Shale Oil sands Production CEOR CUSTOMERS Service companies Operators VALUE PROPOSITION Manufacturing + Innovation Solutions GROWTH (KEMIRA’S) Moderate Strong

slide-44
SLIDE 44

KEMIRA

  • Provides unique chemistries, friction reducers,

that reduce energy needed during hydraulic fracturing

  • Volume growth over 100% in H1 2017
  • Differentiating from competitors with innovative products

Shale Market

  • Polymer market size +200M

EUR and growing at double digit today

  • Polymer more favorable

product based on cost/performance

September 21, 2017 Capital Markets Day 44

Our innovations make shale industry more efficient

KEMIRA Competitor A Competitor B Competitor C Others

Market shares in polymers used for fracking

#1 market position with over 30% market share

slide-45
SLIDE 45

KEMIRA

  • Kemira’s MaxXtract solution tailored specifically to customer

needs, incorporating chemistry, equipment and services

  • Kemira’s knowhow in polymers helps oil producers
  • Potential for > EUR 100 million revenue in 5 years

Substantial long-term growth potential within existing CEOR projects and through new projects Chemical Enhanced Oil Recovery market

  • CEOR market size EUR 1bn of

which EUR 500 million accessible to Kemira

  • Market growth estimated to be

5% driven by decline of production from existing fields

September 21, 2017 Capital Markets Day 45

Long-term growth potential in CEOR

slide-46
SLIDE 46

KEMIRA

  • Offers total solutions to reduce environmental concerns
  • Customer base expanding
  • Revenue has grown to above EUR 20 million in 2 years
  • Target to more than double current revenues in 2-3 years

Companies operating in oil sands market (examples) Oil sands market

  • Market size is around

EUR 400 million

  • Projects are capex-heavy

but developed projects are considered as sunken costs

September 21, 2017 Capital Markets Day 46

Oil sands has grown from 0 to above EUR 20m in 2 years

slide-47
SLIDE 47

OIL & GAS REVENUE GROWTH EUR million

Building on current performance for future growth

Strategic priorities

  • Strengthen position and keep growth

momentum

  • Increase margins
  • Hire and develop our people
  • Innovate for further growth

– Introduction of new products – Field trials in new key applications

September 21, 2017 Capital Markets Day 47

75%

Americas

25%

EMEA

57 83

H1 2016 H1 2017 +47%

slide-48
SLIDE 48

New business – EUR 30 million

Niche position in niche market

Oil & Gas well positioned for growth in niche areas

September 21, 2017 Capital Markets Day 48

Diversification – EUR 152 million (LTM)

Growing in shale,

  • il sands and CEOR

Bigger and better

Strong player in three core areas (shale, oil sands, CEOR), including service capabilities

2017 Phase II 2022 Phase III 2009 Phase I

Oil & Mining Industry & Water: Global Oil and Gas

LTM = Last Twelve Months ending June 2017

slide-49
SLIDE 49

Sourcing – contributing to profitability improvement

Capital Markets Day

Thierry Blomet, SVP, Sourcing September 21, 2017

slide-50
SLIDE 50

Strategic sourcing improves cost competitiveness, service performance, and reduces risk

September 21, 2017 Capital Markets Day 50

VARIABLE COST SPLIT 2016 EUR 1.3 billion EXPOSURE TO OIL RELATED RAW MATERIALS TOP 10 RAW MATERIALS BY SPEND

  • 1. Sodium hydroxide
  • 2. Acrylonitrile (OR)
  • 3. Colloidal silica dispersion
  • 4. Fatty acid
  • 5. Aluminium hydrate
  • 6. Amines (OR)
  • 7. Alpha olefin (OR)
  • 8. Acrylic ester (acrylic acid and

methyl acrylate) (OR)

  • 9. Petroleum solvents (OR)

10.Sodium chloride Top 10 account for almost 50%

  • f Kemira’s raw material spend

30%

Oil related

70%

Not oil related

65%

Raw materials

15%

Electricity & energy

20%

Logistics

slide-51
SLIDE 51

Sourcing continues to improve Kemira’s performance

Single source dependency

% of total raw material spend

5 10 15 20 25 30 35 2012 2013 2014 2015 2016

Payment term

Days

5 10 15 20 25 30 35 40 45 50 2012 2013 2014 2015 2016

September 21, 2017 Capital Markets Day 51

REDUCE RISK IMPROVE WORKING CAPITAL Improved

by 15 days Improved

  • ver 20ppt
slide-52
SLIDE 52

Sourcing helps business to improve profitability in changing markets

Raw material availability Price dynamics

September 21, 2017 Capital Markets Day 52

slide-53
SLIDE 53

Supply / demand impacted by investments, end-markets and disruptions

Long cycles of oversupply

  • r tightness driven by

producers’ investments and industry demand Our solution:

  • 1. Contracted supply vs.

spot is critical

  • 2. Timing, and length of

contracts are key to competitiveness

  • 3. Multiple sources required

Supply disruptions are typical in chemical industry

September 21, 2017 Capital Markets Day 53

slide-54
SLIDE 54
  • 50%
  • 30%
  • 10%

10% 30% 50% 70% 90%

Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17

WTI Crude Oil Jet Kero 55 US Propylene US Ethylene Acrylonitrile Acrylic Acid

Feedstock and raw material price dynamics

Change (y-o-y) in key feedstock and raw material prices in the US

September 21, 2017 Capital Markets Day 54

Around 30% of raw material spend is connected to volatile vertically integrated petrochemical value chain Most feedstock are globally traded commodities significantly influenced by FX and cross-region trading arbitrage Our solution:

  • 1. Value-chain cost

modeling

  • 2. Agile price

management

Key oil related raw materials Key feedstock

WTI +68% Propylene +33% Acrylonitrile +18%

slide-55
SLIDE 55

Better sourcing, through strategic management of over EUR 1bn spend, is contributing to profitability improvement

Reduce single source dependency Increase preferred vendors spend Drive supplier relationship strategically Single source exposure < 5% of total raw material spend Preferred vendors share > 65% of total indirect spend Supplier initiatives > EUR 5 million savings Sourcing fixed cost < 0.3% of Kemira revenue Digitalize and automate to increase efficiency

Actions Targets

slide-56
SLIDE 56

Kemira continues to grow supported by value creating investments

Capital Markets Day

Petri Castrén, CFO September 21, 2017

slide-57
SLIDE 57

PULP & PAPER

11.5% 11.8% 11.7% 12.1% 13.4% 13.0%

2012 2013 2014 2015 2016 LTM

MUNICIPAL & INDUSTRIAL INDUSTRY & WATER

Both segments targeting 14-16% operative EBITDA

  • Pulp & Paper has gradually improved its margin towards 14-16% range
  • Raw material price pressure was visible in both segments in H1 2017

September 21, 2017 Capital Markets Day 57

Mid-to long-term target Target 14-16%

10.4% 10.4% 12.3% 12.2% 11.8% 11.1%

2012* 2013* 2014* 2015* 2016 LTM Target 14-16% Mid-to long-term target

9.3% 10.4% 12.1% 13.7% 14.9%

2012 2013 2014 2015 2016

OIL & MINING

12.6% 10.5% 12.7% 9.6% 5.9%

2012 2013 2014 2015 2016 LTM = Last Twelve Months ending June 2017

* Figures are sum of M&I and O&M segments

slide-58
SLIDE 58

VARIABLE COST VS SALES PRICE TREND

Raw material costs and sales price correlation

September 21, 2017 Capital Markets Day 58

  • Strong correlation between sales prices and variable costs
  • In the history, the lag has been around 2-3 quarters
  • 150
  • 100
  • 50

50 100 150 200 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Brent oil, USD Sales prices* Variable costs*

*) 12-month rolling change vs previous year in EUR million

slide-59
SLIDE 59

Profitability impacted by net change of sales prices and variable costs

  • In 2016, net change of sales prices

and variable costs compared to 2015 was zero

  • In H1 2017, clear headwind

– Net impact of sales prices and variable costs on EBITDA was around EUR -36 million – This is being mitigated by price increases

  • We expect headwind to ease in the

coming quarters

Sales prices and variable costs on EBITDA level (change y-o-y)

9 5

  • 3
  • 10
  • 16
  • 20
  • 9
  • 18
  • 26
  • 23
  • 16
  • 4
  • 18
  • 23
  • 23
  • 13

16

  • 30
  • 20
  • 10

10 20 Q1 Q2 Q3 Q4 Q1 Q2 2016 2017 Net impact on EBITDA (sales prices-variable costs) Sales prices Variable costs

September 21, 2017 Capital Markets Day 59

slide-60
SLIDE 60

134 139 146 182 213 2012 2013 2014 2015 2016 2017

Investing in value creating growth

Recent largest value creating investments

  • New chlorate plant in Brazil and new chlorate

line in Finland

  • Capacity additions due to integration of acq.
  • Polymer capacity in Italy and UK

CAPEX guidance and return criteria

  • In 2018, depending on timing of
  • pportunities, EUR 160-200 million

– Includes capacity expansion in Oil & Gas

  • Thereafter, around 5-6% of revenue

– Flexibility maintained for selected major expansion projects

  • Expansion projects in strategic investment

areas with sufficient financial returns Capital expenditure excluding acquisitions

EUR million

September 21, 2017 Capital Markets Day 60

Expansion Improvement Maintenance

Around EUR 200m

slide-61
SLIDE 61

2017 2018 2019 2020 2021 2022 2023 2024 EIB NIB Bilaterals Bonds Undrawn RCF Others

Debt portfolio is well diversified

Net debt / operative EBITDA and Gearing Gross debt maturity profile, end of Q2 2017

EUR million

September 21, 2017 Capital Markets Day 61

127 80 110 150 205 200 42% 41% 42% 54% 54% 61% 69%

2012 2013 2014 2015 2016 H1 2016 H1 2017 1.9x 2.1x 2.1x 2.2x 1.8x 2.6x 2.3x

532m 758m 456m 486m 634m 642m 690m 400 249m 297m (r12m) 252m 253m 303m 287m 298m Net debt Operative EBITDA

slide-62
SLIDE 62

Continue to grow supported by value creating investments

Deliver higher profitability Efficient capital allocation and returns Improve cash flow

1 2 3

GROUP

Above-the-market growth Operative EBITDA 14-16% Gearing below 60%

Dividend policy: stable and competitive dividend

Group’s mid- and long-term financial targets

slide-63
SLIDE 63

CEO’s closing remarks

GROUP

Above-the-market growth Operative EBITDA 14-16% Gearing below 60%

Dividend policy: stable and competitive dividend

What has changed since 2016 CMD

  • Oil & Gas is back on track
  • Sales price decline stopped
  • Organizational structure streamlined –

leaner and more agile

  • Expansion investments completed
  • BOOST progressed
  • R&D – new products launched

Group’s mid- and long-term financial targets

slide-64
SLIDE 64

Appendix

slide-65
SLIDE 65

Key figures – 2017 vs 2016

EUR million Q2 2017 Q2 2016 Δ% H1 2017 H1 2016 Δ% Revenue 617.2 587.8 +5 1,227.3 1,170.5 +5 Operative EBITDA 77.1 78.9

  • 2

146.1 151.7

  • 4

margin 12.5% 13.4%

  • 11.9%

13.0%

  • Operative EBIT

43.6 46.6

  • 6

78.6 87.5

  • 10

margin 7.1% 7.9%

  • 6.4%

7.5%

  • Finance costs, net
  • 7.7
  • 0.3
  • 14.4
  • 6.3
  • Earnings per share, EUR

0.12 0.17

  • 29

0.24 0.33

  • 27

Cash flow from operations 28.6 57.0

  • 50

40.8 83.2

  • 51

Capex excl. acquisitions 45.2 43.3 +4 82.1 74.7 +10 Net debt 758 690 +10 758 690 +10 Gearing, % at period-end 69 61

  • 69

61

  • Inventories

227 214 +6 227 214 +6 Personnel at period-end 4,849 4,873 4,849 4,873

September 21, 2017 Capital Markets Day 65

slide-66
SLIDE 66

Pulp & Paper

EUR million Q2 2017 Q2 2016 Δ% H1 2017 H1 2016 Δ% 2016 2015 Δ% Revenue 368.9 361.1 +2 741.1 723.5 +2 1,457.3 1,417.3 +3 Operative EBITDA 47.8 49.3

  • 3

93.8 97.2

  • 3

195.3 171.0 +14 margin 13.0% 13.7%

  • 12.7%

13.4%

  • 13.4%

12.1%

  • Operative EBIT

25.7 28.9

  • 11

49.6 57.1

  • 13

111.6 96.8 +15 margin 7.0% 8.0%

  • 6.7%

7.9%

  • 7.7%

6.8%

  • Capital expenditure

35.2 25.8 +37 65.0 40.6 +60 125.1 240.1

  • 48

Cash flow after investing activities 8.9 59.3

  • 85
  • 14.0

58.6

  • 105.7
  • 63.2
  • September 21, 2017

Capital Markets Day 66

slide-67
SLIDE 67

Industry & Water

EUR million Q2 2017 Q2 2016 Δ% H1 2017 H1 2016 Δ% 2016 2015* Δ% Revenue 248.3 226.7 +10 486.1 447.0 +9 906.0 955.8

  • 5

Operative EBITDA 29.3 29.6

  • 1

52.3 54.5

  • 4

107.2 116.3

  • 8

margin 11.8% 13.1%

  • 10.8%

12.2%

  • 11.8%

12.2%

  • Operative EBIT

17.9 17.7 +1 29.0 30.4

  • 4

58.5 66.3

  • 12

margin 7.2% 7.8%

  • 6.0%

6.8%

  • 6.5%

6.9%

  • Capital expenditure

10.0 17.6

  • 43

17.1 32.3

  • 47

85.5 64.9 32 Cash flow after investing activities 3.3 5.1

  • 36

12.5 6.5 +90 35.6 48.9

  • 27

September 21, 2017 Capital Markets Day 67 * Sum of Oil & Mining and Municipal & Industrial segments.

slide-68
SLIDE 68

Revenue split by country

FY 2016

September 21, 2017 Capital Markets Day 68

AMERICAS APAC EMEA USA 27% Canada 5% Brazil 3% Uruguay 2% Other Americas 1% Finland 14% Germany 6% Sweden 6% Poland 3% UK 3% Spain 2% Other APAC 6% Indonesia 1% China 3% Other EMEA 8% Norway 2% Russia 2% Netherlands 2% France 2% Italy 2%

slide-69
SLIDE 69

KEMIRA REVENUE DISTRIBUTION 2016 KEMIRA COST DISTRIBUTION 2016

Revenue and cost distribution per currency

September 21, 2017 Capital Markets Day 69

  • Currency exchange rates had around EUR +4 million impact on the operative

EBITDA in Q2 2017 and around +5 million in H1 2017.

  • Guidance: 10% change in our main foreign currencies would approximately have

EUR 10 million impact on operative EBITDA on an annualized basis

EUR 44% USD 35% CAD 4% BRL 3% CNY 3% Others 11% EUR 41% USD 31% CAD 4% SEK 8% CNY 4% Others 12%

slide-70
SLIDE 70

Key figures and ratios – 5-year summary

EUR million (except ratios) 2012* 2013 2014 2015 2016 Revenue 2,240.9 2,229.1 2,136.7 2,373.1 2,363.3 Operative EBITDA 249.4 251.9 252.9 287.3 302.5

  • f which margin

11.1% 11.3% 11.8% 12.1% 12.8% Operative EBIT 155.5 164.2 158.3 163.1 170.1

  • f which margin

6.9% 7.4% 7.4% 6.9% 7.2% Cash flow from operations 176.3 200.3 74.2 247.6 270.6 Capital expenditure, excluding acq. 134.1 133.5 140.6 181.7 212.6 Gearing at period-end 42% 41% 42% 54% 54% Inventories 182 170 197 207 217 Personnel at period-end 4,857 4,453 4,248 4,685 4,818

September 21, 2017 Capital Markets Day 70 * Restated figures reflect the change of IAS 19, Employee Benefits

slide-71
SLIDE 71

Per share figures – 5-year summary

2012 2013 2014 2015 2016 Earnings per share, EUR 0.12

  • 0.21

0.59 0.47 0.60 Cash flow from operating activities per share, EUR 1.16 1.32 0.49 1.63 1.78 Equity per share, EUR 8.20 7.32 7.57 7.76 7.68 Dividend per share, EUR 0.53 0.53 0.53 0.53 0.53 Share price, EUR, end of period 11.81 12.16 9.89 10.88 12.13 Market capitalization, EUR million 1,796 1,849 1,504 1,654 1,848 Number of shares, million (excl. treasury shares) 152.0 152.0 152.1 152.1 152.4 P/E ratio 98.4

  • 16.7

23.3 20.2 P/CF ratio 10.2 9.2 16.7 6.7 6.8 P/B ratio 1.4 1.7 1.3 1.4 1.6 Dividend yield, % 4.5 4.4 5.4 4.9 4.4

September 21, 2017 Capital Markets Day 71

slide-72
SLIDE 72

Income statement (IFRS)

EUR million 2016 2015 Revenue 2,363.3 2,373.1 Other operating income 5.1 7.1 Operating expenses

  • 2,084.2
  • 2,116.4

Depreciations, amortizations and impairments

  • 137.2
  • 131.2

Operating profit 147.0 132.6 Finance costs (net)

  • 19.1
  • 30.8

Share of profit or loss of associates 0.1 0.3 Profit before tax 128.0 102.1 Income taxes

  • 30.1
  • 24.9

Net profit for the period 97.9 77.2 Equity owners of the parent 91.8 71.0 Non-controlling interests 6.1 6.2 Earnings per share for net profit attributabe to the equity owners of the parent company (EUR per share) 0.60 0.47

September 21, 2017 Capital Markets Day 72

slide-73
SLIDE 73

Balance sheet (IFRS)

EUR million 2016 2015 Goodwill* 522 518 Other intangible assets 116 135 Property, plant and equipment 916 815 Shares and other investments 268 357 Inventories* 217 207 Receivables 409 411 Cash and cash equivalents 173 152 Total assets 2,621 2,595 Equity 1 183 1 193 Interest-bearing liabilities 807 794 Interest-free liabilities 631 608 Total equity and liabilities 2,621 2,595

September 21, 2017 Capital Markets Day 73 * Key audit matter

slide-74
SLIDE 74

Cash Flow statement (IFRS)

EUR million 2016 2015 Net profit for the period 98 77 Total adjustments 187 189 Change in net working capital 29 21 Finance expenses

  • 20
  • 27

Income taxes paid

  • 23
  • 12

Net cash generated from operating activities 271 248 Purchases of subsidiaries and business acquisitions 2

  • 123

Capital expenditure

  • 213
  • 182

Proceeds from sale of assets 37 3 Change in long-term loan receivables 1 Cash flow after investing activities 98

  • 54

September 21, 2017 Capital Markets Day 74

slide-75
SLIDE 75

Cash flow – profitability improvement is the main driver

  • Cash flow from operations has

improved nicely 2011-2016

  • Main driver for cash flow is profitability

target of 14-16% operative EBITDA

  • Net Working Capital at good level,

around 8% of 2016 revenue

– BOOST expected to improve inventories, revenue growth impacting NWC to other direction

  • No major change expected in Finance

expenses

  • Taxes paid expected to increase

– Underlying tax rate 22-25%

EUR million 2016 2015

Operative EBITDA 303 287 Reported EBITDA 284 264

Change in NWC 29 21 Finance expenses

  • 20
  • 27

Taxes paid

  • 23
  • 12

Other items 1 2

Cash flow from operations 271 248

September 21, 2017 Capital Markets Day 75

slide-76
SLIDE 76

Kemira offers stable and competitive dividends

  • Kemira’s dividend policy is to pay

a stable and competitive dividend

  • Kemira has paid dividends every year

since listing of shares in 1994

  • Kemira offers attractive dividend yield

– Average dividend yield in relevant indices

  • EuroStoxx Chemicals 2.3%
  • OMX Helsinki 25 3.5%

0.53 0.53 0.53 0.53 0.53 0.53 5.8% 4.5% 4.4% 5.4% 4.9% 4.4% 2011 2012 2013 2014 2015 2016

September 21, 2017 Capital Markets Day 76

Dividend per share Dividend yield

Kemira’s dividend yield calculated using the share price at year-end

slide-77
SLIDE 77

Addressing fixed and variable costs

Operating expenses in 2016 EUR 1.9 billion

  • Kemira is actively reducing its cost base
  • New two segment structure and related

reorganization is purely addressing fixed costs

– Savings target EUR 15-20 million – Run-rate by end of 2017

  • BOOST program, savings mostly in

logistic costs

– Savings target EUR 20-30 million – Run-rate in 1-2 years – In addition, inventory reduction target of EUR 50 million

September 21, 2017 Capital Markets Day 77

10%

Electricity and energy

30%

Fixed costs

45%

Raw materials

15%

Logistics

slide-78
SLIDE 78

Pulp & Paper – Technology and market leader

September 21, 2017 Capital Markets Day 78

Value chain part covered by Kemira RAW MATERIALS INTERMEDIATES PRODUCTS APPLICATIONS CUSTOMER IDUSTRIES CUSTOMERS Electricity Sodium chloride (salt) Crude tall oil Cationic monomer Acrylonitrile Acrylic acid Olefins Fatty acids Maleic anhydride Sulfur Tall oil rosin AKD Wax Isomerized olefins Acrylamide Sodium chlorate Hydrogen peroxide Polymers Defoamers Coagulants Biocides Sizing Strength Additives Surface additives Colorants Sulfuric acid Pulping Bleaching Retention Wet-end process control WQQM Sizing Strength Surface treatment Coloring Pulp Packaging and board Printing and writing Tissue All the major global paper and pulp producers Main competitors: BASF, Akzo Nobel, Solenis, Ecolab, SNF

slide-79
SLIDE 79

Industry & Water – Technology and market leader in water treatment as well as in niche applications in oil & gas

September 21, 2017 Capital Markets Day 79

RAW MATERIALS INTERMEDIATES PRODUCTS APPLICATIONS SALES CHANNEL CUSTOMERS Acrylonitrile Acrylic acid Sulfuric acid Hydrochloric acid Aluminium hydrate Iron ore Pickling liquor Copperas Various monomers Acrylamide Polymers (EPAM, DPAM) Al Coagulants Fe Coagulants Dispersants & antiscalants Biocides Emulsifiers Defoamers Formulations Raw water & waste water treatment Sludge treatment Friction reduction Enhanced oil recovery Tailings treatment Mining processes Direct sales Distributor/reseller Service companies Municipalities Private operators Industrial customers Pumpers Oil & Gas operators Service companies Mine operators Cationic monomer Main competitors: Coagulants: mainly local small companies, Feralco, USALCO Polymers: SNF, Solvay, Ecolab, Solenis, BASF Value chain part covered by Kemira

slide-80
SLIDE 80

Kemira – largest shareholders and Board of Directors

Shareholders on August 31, 2017

% of shares

  • 1. Oras Invest

18.2%

  • 2. Solidium (owned by State of Finland)

16.7%

  • 3. Varma Mutual Pension Insurance

Company 3.4%

  • 4. Ilmarinen Mutual Pension Insurance

Comp. 2.3%

  • 5. Kemira Oyj

1.9% Total number of shares 155,342,557 Foreign ownership of shares 24.5% Total number of shareholders 35,595

Kemira Board of Directors

September 21, 2017 Capital Markets Day 80

Jari Paasikivi, Chairman Member since 2012 Oras Invest Oy, CEO Kerttu Tuomas Vice Chairman Member since 2010 Wolfgang Büchele Member in 2009- 2012 and since 2014 Kaisa Hietala Member since 2016 Timo Lappalainen Member since 2014 Shirley Cunningham Member since 2017

slide-81
SLIDE 81

Kemira’s Management Board

September 21, 2017 Capital Markets Day 81

Jukka Hakkila, Chief Legal Officer, acts as secretary of Management Board and Board of Directors

Pulp & Paper Kim Poulsen Operational Excellence Esa-Matti Puputti Human Resources Eeva Salonen Industry & Water Antti Salminen CFO Petri Castrén CTO Heidi Fagerholm President and CEO Jari Rosendal

slide-82
SLIDE 82

Data about shale oil and gas industry

US rig count (quarterly avg) and oil price

(WTI)

10 20 30 40 50 60 70 80

200 400 600 800 1000 1200 1400 1600

Q1/15 Q3/15 Q1/16 Q3/16 Q1/17

Frac stages in North America

(source: IHS Markit)

100 200 300 400 500 600 700 800 900

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

September 21, 2017 Capital Markets Day 82

Rig count

Outlook

Oil price

slide-83
SLIDE 83

September 21, 2017 Capital Markets Day 83

Targets & Performance: Q2/2017

CORPORATE RESPONSIBILITY UPDATE 1/2

Focus area Issue, KPI, target value Comments Status

Sustainable products & solutions INNOVATION SALES Share of innovation revenue

  • f total revenue, %

 10% by the end of 2017  KPI reported quarterly During Q2/2017 several new products or solutions were commercialized and Kemira expects to achieve the 10% target during 2017. Responsibility in our supply chain SUPPLIER MANAGEMENT Number of onsite sustainability audits for highest risk suppliers

(with lowest sustainability assessment score1)

 5 suppliers audited every year during 2016-2020, average  KPI reported annually All earlier low-scored suppliers improved their performance in re-assessments, and no new high risk raw material suppliers were

  • detected. However, a few suppliers have

refused to take EcoVadis assessments this year due to lack of resources or company

  • policies. Those will be audited in Q3 and Q4

2017. Responsible manufacturing CLIMATE CHANGE Carbon index  Kemira Carbon Index ≤ 80 by end

  • f 2020 (2012 = 100)

 KPI reported annually Sourcing of low carbon energy continued according to plan. As part of the E3 Plus program, four Energy Review site visits were performed during Q2 2017. The performed energy reviews cover more than 90% of Kemira’s total energy consumption.

5% 7% 8% 8% 9% 9% 10% 2012 2013 2014 2015 2016 2017 Q2 Target 2017 4 4 25 2016 2017 Q2 Target 2020 100 88 91 92 86 80 2012 2013 2014 2015 2016 Target 2020 Behind target In progress Achieved Behind target In progress Achieved Behind target In progress Achieved

slide-84
SLIDE 84

Focus area Issue, KPI, target value Comments Status

Responsibility towards the employees OCCUPATIONAL HEALTH AND SAFETY Number of Total Recordable Injury Frequency (TRIF) (per million hours,

Kemira + contractor, year-to-date1)

 Achieve zero injuries (TRIF 2.0 by end of 2020)  KPI reported quarterly Behaviour Based Safety (BBS) program pilots moving ahead as planned, and next 10 sites implementation starts in Q3 (YTD: 4). To improve our contractor safety we have launched Contractor Safety Program which is looking contractor safety from contracting to materialization of the contracted work. EMPLOYEE ENGAGEMENT Employee engagement index based

  • n Voices@Kemira biennial survey

 The index at or above the external industry norm Participation rate in Voices@Kemira  75 % or above  KPI reported biennially We aim to confirm the next Voices@Kemira survey by Q4 2017. LEADERSHIP DEVELOPMENT Leadership development activities provided, average  Two (2) leadership development activities per people manager position during 2016-20202  KPI reported annually High level of activity continued, with 191 leadership development activities provided during Q2 2017 (target: 75 per quarter).

September 21, 2017 Capital Markets Day 84

Targets & Performance: Q2/2017

CORPORATE RESPONSIBILITY UPDATE 2/2

Behind target In progress Achieved Behind target In progress Achieved Behind target In progress Achieved 70% 58% 67% 84% 75% 85% 2011 2013 2015 Engagement Participation 8.5 7.1 5.8 7.2 3.4 3.8 2012 2013 2014 2015 2016 2017 Q2 494 685 1500 2016 2017 Q2 Target 2020

1 The TRIF reporting has been changed to a year-to-date figure instead of 12 month rolling average that was previously used. 2 The cumulative amount of leadership development required to reach two (2) leadership development activities per people manager position during 2016-2020 equals 1500 leadership activities (when number of people manager

positions is 650-850). Development activities include job rotations, coaching and mentoring, and development programs.

slide-85
SLIDE 85