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SCA Year-end Report Q4 2015

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Organic sales growth was 5% for the full year 2015, and operating profit, excluding items affecting comparability, rose 10% compared with 2014. Read the full report: http://www.sca.com/en/IR/Reports/Interim-reports/Reports/2015/2015-Q4/

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SCA Year-end Report Q4 2015

  1. 1. Year-end Report 2015
  2. 2. Magnus Groth President and CEO January 28, 2016 Year-end Report 2015 2
  3. 3. January 28, 2016 Year-end Report 2015 3 Summary 2015 Good organic growth in sales and operating profit Strong growth in emerging markets Good cash flow Continued strong contribution from efficiency gains Around 30 innovations and product launches for example Libero, Nosotras, Tempo, TENA and Tork The Board of Directors proposes an increase in the dividend by 9.5% to SEK 5.75 per share
  4. 4. Group 2015 vs. 2014 January 28, 2016 Year-end Report 2015 4 Organic Sales Growth Operating Profit* Operating Margin* Operating Cash FlowEPS**** Sales SEK 115,316m +11% * Excluding items affecting comparability ** Excluding items affecting comparability, gains on forest swaps and currency translation effects *** Excluding items affecting comparability and gains on forest swaps **** Including items affecting comparability. Excluding items affecting comparability and a tax provision SEK 12.25, +11% SEK 13,014m +8%** 11.3% +20bp*** SEK 9.97 +6% SEK 12,921m +16% 5%
  5. 5. January 28, 2016 Year-end Report 2015 5 *Return on capital employed excluding items affecting comparability SCA Group ROCE* 2013 2014 2015 Target 13% ROCE* 10.9% 11.2% 12.0%
  6. 6. Dividend January 28, 2016 Year-end Report 2015 6 The Board of Directors proposes an increase in the dividend by 9.5% to SEK 5.75 per share (5.25)
  7. 7. Group Q4 2015 vs. Q4 2014 January 28, 2016 Year-end Report 2015 7 Organic Sales Growth Operating Profit* Operating Margin* Operating Cash Flow Sales SEK 29,040m +6% * Excluding items affecting comparability ** Excluding items affecting comparability and currency translation effects *** Including items affecting comparability. Excluding items affecting comparability and a tax provision SEK 3.37, +6% SEK 3,454m +5%** 11.9% 0bp SEK 4.03 +97% SEK 3,731m +1% 4% EPS***
  8. 8. January 28, 2016 Year-end Report 2015 8 Important Events 2015 Decision to acquire Wausau Paper Corp., a North American Away-from-Home tissue company Decision to divest business in South East Asia, Taiwan and South Korea for integration with Vinda Addressed low performing baby diapers businesses Closure of tissue production facility in France and newsprint machine in Sweden Investing in increased pulp capacity in Sweden and a new production facility for incontinence products in Brazil Decision to divide the Group into two divisions: a Hygiene division and a Forest Products division Enhancing the hygiene organization Inclusion in Dow Jones Sustainability Indices as industry leader
  9. 9. Strategic Priorities January 28, 2016 Year-end Report 2015 9 EFFICIENCYINNOVATIONPROFITABLE GROWTH INCREASING EFFICIENCY IN THE ENTIRE VALUE CHAIN
  10. 10. Innovations and Product Launches Q4 2015 Tork Matic® Hand Towel Roll Dispenser – with Intuition™ Sensor, Image Design™ Gives guests the ultimate hand drying experience Creates a sophisticated impression in the washroom, which is as important as the image customers perceive when they first enter a building Touch free, one-at-a-time dispensing reduces consumption and improves hygiene 1010January 28, 2016 Year-end Report 2015 Delivers high capacity to avoid towel run- outs in high-traffic washrooms with a 300m long refill, delivering 1,218 hand towels per roll One-at-a-time sheet dispensing controls consumption Reliable, simple, robust design for demanding environments Q4 2015 Tork® Hand Towel Roll Dispenser Approximately 30 innovations and product launches during 2015 2015 Innovations and product launches
  11. 11. January 28, 2016 Year-end Report 2015 11 Fredrik Rystedt CFO
  12. 12. Net sales Q4 2014 Price/Mix Volume Currency Net sales Q4 2015 Organic sales growth 4% Price/Mix 1% Volume 3% January 28, 2016 Year-end Report 2015 12 1% 3% SEK 27,397m 2% SEK 29,040m Net Sales Q4 2015 vs. Q4 2014 +6%
  13. 13. Organic Sales Growth January 28, 2016 Year-end Report 2015 13 0% 2% 4% 6% 8% 2012 2013 2014 2015 Group Tissue 0% 2% 4% 6% 8% 2012 2013 2014 2015 0% 2% 4% 6% 8% 2012 2013 2014 2015 Personal Care
  14. 14. Operating Profit Q4 2014 Price/Mix Volume Raw Material Energy Currency Other Operating Profit Q4 2015 January 28, 2016 Year-end Report 2015 14 SEK +375m SEK 3,250m SEK 3,454m Operating Profit* – Group Q4 2015 vs. Q4 2014 +6% SEK +266m SEK -529m SEK +128m SEK +34m SEK -70m * Excluding items affecting comparability
  15. 15. Year-end Report 2015 Examples of USD movements January 28, 2016 15 1,00 1,05 1,10 1,15 1,20 1,25 1,30 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 EUR/USD USD/RUB 2,00 2,50 3,00 3,50 4,00 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 USD/BRL USD/MXN 13 14 15 16 17 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 -14% 40 45 50 55 60 65 70 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 +38% +51% +21% Average Average Average Average
  16. 16. January 28, 2016 Year-end Report 2015 16 Raw Material vs Price and Mix 2015 vs 2014 Raw Material Costs Price/Mix EBIT Margin Impact Raw Material Costs Price/Mix EBIT Margin Impact Group Personal Care Raw Material Costs Price/Mix EBIT Margin Impact Forest Products Raw Material Costs Price/Mix EBIT Margin Impact Tissue -200bp -40bp -210bp +30bp -280bp -150bp +40bp +250bp +230bp +170bp +130bp +210bp
  17. 17. 20152013 24% 76% Share of Net Sales 32% 68% Share of Net Sales 20% 80% Share of Operating Profit SCA Group Mature markets and Emerging markets 17% 83% Share of Operating Profit January 28, 2016 Year-end Report 2015 17 Emerging markets Mature markets Operating Margin 2013* 2014* 2015 Mature markets 11.5% 13.0% 13.3% Emerging markets 7.7% 6.4% 7.0% Total Group 10.6% 11.1% 11.3% *excluding gains on forest swaps
  18. 18. Cash Flow 2015 vs. 2014 Operating cash surplus Change in working capital Restructuring costs, etc Capital expenditures (including strategic) Operating cash flow including strategic capital expenditures 2015 SEKm 2014 SEKm 18,312 -399 -830 -7,287 9,796 16,250 -446 -883 -5,553 9,368 Year-end Report 2015January 28, 2016 18
  19. 19. January 28, 2016 Year-end Report 2015 19 Magnus Groth President and CEO
  20. 20. Personal Care Q4 2015 vs Q4 2014 January 28, 2016 Year-end Report 2015 20 * Excluding items affecting comparability ** Return on capital employed excluding items affecting comparability  Sales growth 7%  Organic sales growth 9%  Operating profit increased 17%*  Better price/mix  Higher volumes  Cost savings  Higher raw material costs mainly due to a stronger USD  Operating margin 12.5%*  ROCE** 33.1% Net Sales Operating Profit* Q4 2015Q4 2014 Q4 2015Q4 2014 Q4 2015Q4 2014 Operating Margin* SEK 8,681m SEK 8,106m SEK 1,086m SEK 930m 11.5% 12.5%+7% +17% +100bp
  21. 21.  Organic sales growth 9%  Price/mix +2%  Volume +7%  Strong growth in emerging markets  Strong growth for feminine care  Good growth for incontinence products  Mature markets  Western Europe - Strong growth for baby diapers - Good growth for feminine care and incontinence products  North America - Higher sales for incontinence products  Emerging markets  Latin America +14% - Strong growth for incontinence products and feminine care - Flat sales for baby diapers  Russia +43% - Strong growth for all product segments Personal Care Q4 2015 vs Q4 2014 January 28, 2016 Year-end Report 2015 21 Organic Sales Growth by Region Organic Sales Growth by Product Segment Incontinence Products Baby Diapers Feminine Care TotalMature Markets Emerging Markets Total +6% +9% +4% +14% +7% +13% +9% 53% 28% 19% % of Personal Care Sales: 58% 42%
  22. 22. Tissue Q4 2015 vs Q4 2014 January 28, 2016 Year-end Report 2015 22 * Excluding items affecting comparability ** Return on capital employed excluding items affecting comparability  Sales growth 7%  Organic sales growth 3%  Operating profit increased 4%*  Better price/mix  Higher volumes  Cost savings  Higher raw material costs mainly due to a stronger USD  Operating margin 11.9%*  ROCE** 14.1% Net Sales Operating Profit* Q4 2015Q4 2014 Q4 2015Q4 2014 Q4 2015Q4 2014 Operating Margin* SEK 16,366m SEK 15,366m SEK 1,943mSEK 1,867m 12.2% 11.9% +7% +4% -30bp
  23. 23. Tissue Q4 2015 vs Q4 2014 January 28, 2016 Year-end Report 2015 23  Organic sales growth 3%  Price/mix +2%  Volume +1%  Strong growth in emerging markets  Mature markets  Western Europe - Higher sales for consumer tissue - Flat sales for AfH tissue  North America - Higher sales for AfH tissue  Emerging markets  Asia +11%  Latin America +7%  Russia +20% Organic Sales Growth by Region Organic Sales Growth by Product Segment Consumer Tissue AfH Tissue TotalMature Markets Emerging Markets Total +3% 0% +10% +3% 64%% of Tissue Sales: 36%68% 32% +5% +2%
  24. 24. Forest Products Q4 2015 vs Q4 2014 January 28, 2016 Year-end Report 2015 24 * Excluding items affecting comparability ** Return on capital employed excluding items affecting comparability Q4 2015  Sales growth 2%  Price/mix -2%  Volume +3%  Currency +1%  Operating profit decreased 10%*  Lower prices (including exchange rate effects)  Impairment loss of trade receivables  Higher costs for production stops  Lower raw material and energy costs  Higher volumes  Operating margin 14.8%*  ROCE** 6.6% Net Sales Operating Profit* Q4 2015Q4 2014 Q4 2015Q4 2014 Q4 2014 Operating Margin* SEK 4,037m SEK 4,133m SEK 683m 16.9% 14.8% SEK 612m +2% -10% -210bp
  25. 25. January 28, 2016 Year-end Report 2015 25 Full year 2015 Summary Good organic growth in sales and operating profit Several strategic initiatives
  26. 26. January 28, 2016 Year-end Report 2015 26 Q&A

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