CEO and President Ilkka Hämälä's presentation on the 12th of February 2020

2. Metsä Group
Result 2019
Ilkka Hämälä
President and CEO
12 February 2020

3. • Sales EUR 5,473 million (2018: EUR 5,709 million)
• Operating result* EUR 495 million (EUR 849 million)
• Operating result* 9.0% of sales (14.9%)
• Return on capital employed* 9.6% (16.8%)
• Operating result weakened due to lower pulp prices and higher
raw material and production costs
• Exchange rate fluctuations had a positive effect on the
operating result
12.2.20203
Weakened market situation
decreased Metsä Group’s result
Metsä Group – Result 2019
*vertailukelpoinen

4. • The average dollar-denominated price of long-fibre pulp
decreased by 10% and that of short-fibre pulp by 15%
compared to the previous quarter
• Paperboard deliveries declined from the previous quarter due
to seasonality. The average prices of paperboard remained
stable
• Metsä Board began investments in the first phase of the
modernisation of the Husum pulp mill
• Metsä Tissue made an agreement on the sale of its napkin
business
12.2.20204
Events during the fourth quarter
Metsä Group – Result 2019

5. 12.2.20205
Sales
Metsä Group – Result 2019
EUR million
5,016
4,658
5,040
5,709 5,473
0
1000
2000
3000
4000
5000
6000
2015 2016 2017 2018 2019

6. 12.2.20206
1,255
1,330
1,2251,205
1,1561,1841,1431,175
1,2161,2351,260
1,328
1,428
1,477
1,3861,419 1,438
1,3721,374
1,290
0
200
400
600
800
1 000
1 200
1 400
1 600
Sales quarterly
EUR million
Metsä Group – Result 2019

7. 12.2.20207
Comparable operating result
Metsä Group – Result 2019
EUR million
537
439
566
849
495
0
200
400
600
800
1000
2015 2016 2017 2018 2019

8. 12.2.20208
129
137
149
123
109
120
103 107
128
119
134
185
208 210
223
208
180
128
110
76
0
50
100
150
200
250
Q1/15 Q2 Q3 Q4 Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4
Metsä Group – Result 2019
EUR million
Comparable operating result, quarterly

9. Change in comparable operating result
9
Metsä Group – Result 2019
EUR million
Comparable operating result 2018 849
Sales prices -364
Sales volumes 54
Exchange rates 104
Wood raw material -75
Raw materials, energy and other variable costs -29
Employee costs -1
Maintenance and other fixed costs -7
Change in inventory -16
Depreciation and other -19
Comparable operating result 2019 495
12.2.2020

10. Items affecting comparability
12.2.202010
Metsä Group – Result 2019
EUR million 2019
Operating result (IFRS) 374.3
Items affecting comparability:
Metsä Board / Disposal of the shares in Liaison Technologies Inc. -3.3
Metsä Board / Sale of Niemenranta lots in Tampere -5.6
Metsä Board / Impairment related to the modernisation of Metsä Board’s Husum pulp mill 19.1
Metsä Tissue / Goodwill related impairment including Group’s eliminations 77.3
Metsä Tissue / Cost provisions related to Metsä Tissue’s efficiency programme 7.6
Metsä Tissue / Items related to the sales of napkin business including Group’s eliminations 19.8
Metsä Tissue / Items related to closing of Krapkowice paper machine in Poland 4.2
Metsä Tissue / Impairment related to the development of the Metsä Tissue’s Raubach mill in Germany 1.4
Items affecting comparability, total 120.6
COMPARABLE OPERATING RESULT 494.9

11. 12.2.202011
Comparable ROCE
Metsä Group – Result 2019
13.6
10.2
12.3
16.8
9.6
0
4
8
12
16
20
2015 2016 2017 2018 2019
%
Target > 12%

12. 12.2.202012
Equity ratio
Metsä Group – Result 2019
43.2 43.9 45.0
53.1
56.2
0
10
20
30
40
50
60
2015 2016 2017 2018 2019
%

13. 12.2.202013
Interest-bearing net liabilities
Metsä Group – Result 2019
610
1,033 993
463
374
0
300
600
900
1 200
1 500
2015 2016 2017 2018 2019
EUR million

14. 12.2.202014
Capital expenditure
Metsä Group – Result 2019
492
758
608
272 260
0
200
400
600
800
2015 2016 2017 2018 2019
EUR million

15. 12.2.202015
Personnel
Metsä Group – Result 2019
9,599 9,300 9,126 9,310 9,265
0
3 000
6 000
9 000
12 000
2015 2016 2017 2018 2019

16. Wood delivery volumes decreased
• Metsä Forest delivered approximately
34.7 million m3 of wood (36.4)
• Log prices decline throughout the year, and the
prices of pulpwood started to decline in Q3
• The supply of wood was weaker than in 2018 in
Finland, but strong in the Baltic Sea region.
Oversupply in the Baltic Sea log market during H2
• Harvesting conditions weakened in Q4
• New pine and spruce mixed cultivation service
was launched for forest owners
• A new service was launched with Dasos to fill
forest owners’ FSC® forest conservation
requirements in January 2020
12.2.202016
Sales and comparable operating result
EUR million
Metsä Forest – Wood Supply and Forest Services
433
397
376
429
490 496
471
526 526
508
474 465
8.5
4.4
5.9
5.4
8.7
5.8
8.9 8.9
11.3
5.6
5.0
5.6
0
3
6
9
12
15
18
0
100
200
300
400
500
600
Sales Operating result

17. Engineered wood products markets slowed down
• The profitability was weakened by poor market
situation and labour disputes
• Costs arising from the ramp-up of strategic
investments, production challenges and raw-
materials burdened profitability
• Profitability of the UK business improved
• Delivery volumes of Kerto® LVL grew, and the
volumes of plywood products declined
• Price of birch plywood and Kerto LVL was at nearly
the same level as in 2018, whereas the prices of
spruce plywood rose
• The ramp-up of the new Kerto LVL line at
Punkaharju proceeded according to plan
12.2.202017
Sales and comparable operating result
EUR million
Metsä Wood – Wood Products Industry
120 122
110
108 109
119
106 108 111
119
111
93
10.7
8.4
7.6
6.9
6.2
5.5
2.8
2.2
1.8
3.3 3.1
-1.1
-3
0
3
6
9
12
0
30
60
90
120
150
Sales Operating result

18. Lower pulp prices led to clearly lower result
• Operating result and sales were weakened by
lower sales prices of pulp and sawn timber, and
higher prices of raw materials
• Higher sales volumes of pulp and sawn timber
and exchange rate fluctuations had positive
effects on the result
• Pulp producers’ stock levels were high during
2019
• The prefeasibility studies on the EUR 1.7 billion
investments on the modernisation of the Kemi
pulp mill and the new Rauma pine sawmill
proceeded according to the plan
12.2.202018
Sales and comparable operating result
EUR million
Metsä Fibre – Pulp and Sawn Timber Industry
422 427
475
552
601
629 609 630 623
556 567
490
54.5
70.8 68.4
125.9
144.9
164.9
187.0
172.0
122.4
83.1
33.0
9.9
0
40
80
120
160
200
240
280
0
100
200
300
400
500
600
700
Sales Operating result

19. 12.2.202019
Price of pulp (PIX) in Europe and China
Metsä Fibre – Pulp and Sawn Timber Industry
USD EUR
Source: Fast Markets Foex
400
600
800
1000
1200
1400
400
600
800
1000
1200
1400
´11 ´12 ´13 ´14 ´15 ´16 ´17 ´18 ´19
Hardwood/EUR Softwood/EUR Hardwood/USD
Softwood/USD Softwood/Kiina/USD Hardwood/Kiina/USD

20. Paperboard industry’s performance at good level
as expected
• The higher sales prices of paperboards had a
positive effect on the operating result
• Exchange rate fluctuations had a positive result
effect of EUR 48 million
• Profitability was weakened by lower market pulp
prices and higher production costs
• Paperboard deliveries declined slightly from 2018
• EUR 21 million investment made on the 1. phase of
modernisation of the Husum pulp mill
• Metsä Board invests approximately EUR 20 million
in modernising the finishing area of Kyro mill’s
paperboard machine, completed in 2021
12.2.202020
Sales and comparable operating result
EUR million
Metsä Board – Paperboard Industry
445
474 479
451
492
519
475 458
487 477 489 478
45.2 43.5
50.4
54.4
69.0
59.2
64.0
60.0 61.8
41.0
42.5
39.1
0
20
40
60
80
100
120
0
100
200
300
400
500
600
Sales Operating result

21. 12.2.202021
600
700
800
900
1000
1100
1200
2011 2012 2013 2014 2015 2016 2017 2018 2019
Folding boxboard White-top kraftliner Sources: Fastmarkets RISI & Fastmarkets FOEX
Prices of folding boxboard and white-top kraftliner in
Europe 2011–Q4/2019
EUR/tonne
Metsä Board – Paperboard Industry

22. Result of the tissue and greaseproof papers
improved
• Sales increased, mainly due to higher sales prices
• Improved result was attributable to the efficiency
measures, an increase in sales prices and lower
raw material costs
• Metsä Tissue made an agreement on the sale of its
napkin business including the Stotzheim mill in
Germany
• An impairment loss of EUR 102 million was booked
mainly with regard to goodwill
• Metsä Tissue is planning to increase tissue paper
capacity in Sweden, and started a related
environmental permit process
12.2.202022
Sales and comparable operating result
EUR million
Metsä Tissue – Tissue and Greaseproof Papers
252 251 250
261 259 256 254
270 267 266 263 264
17.6
16.3 16.8
23.3
12.3 11.5
6.4 6.1
10.5
13.5
22.8
26.6
0
8
16
24
32
40
48
0
50
100
150
200
250
300
Sales Operating result

23. • The insect damages in the Central Europe will continue to have
an impact on the wood trade in the Baltic sea area
• Demand for Kerto LVL and birch plywood is expected to continue
weak, and for spruce plywood products, slightly better
• Pulp market is expected to balance as the demand for market
pulp continues to increase, especially in Asia
• Paperboard deliveries are in Q1 2020 expected to be roughly at
the same level as in Q4 2019 and market prices to remain stable
• Demand for tissue and greaseproof papers is expected to
remain stable
12.2.202023
Summary
Market outlook

24. • Comparable operating results is in
the first quarter of 2020 expected
to weaken from the fourth quarter
of 2019 due to the strikes at
Finnish mills
12.2.202024
Result guidance
Summary

25. • Metsäliitto Cooperative’s Board of Directors has decided to
propose that an interest of 6.5% for 2019 be paid on the
statutory capital invested by members (7.5% for 2018), 6.0%
(7.0%) on additional members’ capital A and 2.0% (2.5%) on
additional members’ capital B
• Metsä Board’s Board of Director proposes that a dividend of
EUR 0.10 per share and a capital distribution of EUR 0.14 per
share be paid for the 2019 financial period. The proposed
dividend and capital distribution, totalling EUR 0.24 per share,
corresponds to 59% of the result per share for 2019
Prososal for interests and dividents
25 12.2.2020