Schweitzer-Mauduit International, Inc. 05/06/10 Investor Presentation

1. Schweitzer-Mauduit
NYSE: SWM
First Quarter 2010

2. Key Investment Highlights
• #1 Global position in cigarette paper and reconstituted tobacco products
• Deep customer penetration and longstanding relationships with western
multinational cigarette companies spanning over 50 years
– Market presence in China for 16 years
• Superior product portfolio featuring high value products
• Regulatory backdrop driving strong growth prospects for “safer” cigarettes
• Executed Asian expansion initiatives with additional opportunities on horizon
• Successfully restructured manufacturing operations driving improved
efficiency and profitability in higher cost regions
• Seasoned management team with over 100 years of industry & manufacturing
experience
2

3. Schweitzer-Mauduit Profile – Financial Highlights
(Amounts in Millions, Except Per Share
Amounts) 1Q10 1Q09
Net Sales $193.0 $184.1
Net Income (1) $18.6 $13.3
Net Income (2) $21.8 $13.5
Adjusted EBITDA (2) $41.7 $30.7
Cash from Operations $31.4 $11.8
Diluted Earnings
per share (2) $1.19 $0.88
Total Assets $771.5 $688.2
Net Debt $(21.3) $158.4
(1) Includes restructuring and impairment
(2) Excludes restructuring and impairment
3

4. Agenda
Overview of Schweitzer-Mauduit
Successfully Restructured Operations
Reconstituted Tobacco Leaf (RTL)
Low Ignition Propensity Tobacco Paper
Financial Review
4

5. Corporate Overview
• Founded in 1545, Schweitzer-Mauduit International’s (“SWM” or the “Company”) strategic focus
has been on cigarette papers since the early 1900s
• Became a public company in December 1995 through a spin-off by Kimberly-Clark Corporation
• Market leadership in tobacco-related specialty paper products
– Leading manufacturer of lower ignition propensity (“LIP”) cigarette paper
– Sole independent pioneer of reconstituted tobacco leaf (“RTL”) products
• Global Presence – Sales to 90 Countries Worldwide
Operation Sites RTL Expansion Opportunities (Asia)
5

6. Management Strategy to Deliver Growth
Leading Global Manufacturer of Fine Papers and Related Products for the
Tobacco Industry
Complete rationalization Continue to upgrade Focus on growth
of base paper and expand through high value
manufacturing profile operations in Asia products & technology
• Finalize restructuring • Establish China paper • Expand sales of RTL
activities in France and the JV as technology leader products through new
U.S. by 2010 on domestic premium production capacity and
brands increased market
• Optimize cost structure penetration in Asia
through repositioned • Develop new Philippines
RTL facility
manufacturing footprint • Capitalize on regulatory
– Company-wide commitment
• Create new China JV to requirements for high
to operational excellence
expand RTL capabilities growth LIP papers
in the region
– Shift production to lower cost
regions
6

7. Substantial Market Growth Prospects Globally
World Cigarette Production by
Global Cigarette Consumption: Geography in 2009
• World-wide cigarette consumption estimated La t in A m er ica Ot h er
5% 4%
at 6.2 trillion units Nor t h A m er ica
6%
– Growing 0.5% to 1.0% annually W est er n Eu r ope Ch in a
11%
• Market shifting from the West to the East 37%
– Asia growing 2.5% to 3.0% annually Ea st er n Eu r ope
A sia Pa cific
15%
6,000 90% 22%
80%
5,000
70% SWM Sales by Geography in 2009 1
La t in
% of Production
4,000 60%
A m er ica , Ot h er , 3 %
Million Units
50% 7%
3,000
40% A sia /Pa cific, 1 1 %
W est er n
2,000 30%
Eu r ope,
20% 31 %
1,000 Ch in a , 9 %
10%
0 0%
Nor t h A m er ica ,
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Ea st er n Eu r ope, 29%
1 0%
Production Developed Countries Production Developing Countries
1
% Developed Countries % Emerging Countries Total sales include $ 740 mm for SWM and $32 mm
for its unconsolidated joint venture, CTM
SWM Strategy is to Target High Growth
Source: SWM management Developing Markets
7

8. Full Line of High Value Tobacco-Related Products
• Performance critical to high-speed, low-
cost cigarette manufacturing Tipping Plug Wrap
Paper Paper
– Runability
– Consistency
• Premium product quality drives
longstanding customer relationships
Cigarette
– Seamless integration with leading global Paper
customers’ operations
Reconstituted
• Technology and research and Tobacco
development efforts support high-value
product applications
– Taste
– Reduced tar, carbon monoxide and nicotine
delivery
– Lower ignition propensity
8

9. Full Range of Specialty Tobacco Products
Product Type Commentary
Reconstituted Tobacco Manufactured from tobacco by-products
Leaf Used in cigarette design to provide unique brand taste
Lower cost than natural tobacco
Benefitting from regulatory change
Lower Ignition Propensity Controls rate of cigarette combustion by slowing air flow
Paper High growth due to regulatory-mandated adoption
European, Australia and likely other Asian countries to adopt
through 2012
Base Paper Key to provide full range of products to largest, multinational
- Cigarette Paper customers
- Plug Wrap More competitive environment due to declining demand in
- Tipping Paper developed world
- Non-tobacco products
SWM restructuring activities focused on maximizing efficiency,
reducing costs and shifting capacity towards growth in Asia
9

10. Leading Global Provider of Cigarette Paper & Related Products
• Sole independent RTL manufacturer globally
• Leading manufacturer of LIP and only producer of both proven technologies
Global Positioning: Tobacco Paper 1
Julius Miguel y
Key Products SWM Delfort
Glatz Costas
Miguely Costas
(Spain) Other
RTL 8% 10%
SWM²
Cigarette Paper (U.S.)
(LIP) Julius Glatz 36%
(Germany)
12%
Cigarette Paper
(Wood, Flax)
Delfort (Austria)
Plug Wrap 34%
(Porous,
Conventional)
Tipping Paper
(Base, Note: Circles to left reflect relative estimated market strength by product
Finished) Source: Company filings, SWM management
1
Market share by volume, excluding China
2
Non-tobacco SWM volumes exclude production from its facilities in France (LTR and
Malaucène)
(% of Net <10% >50% <10% >20%
Sales) 10

11. Strong Relationships with Leading Global Players
• Top six customers account for approximately 80% of the global market (incl. China)
– Relationships averaging over 50 years among six leading western multinational customers
2009 Global Cigarette Production (Units) SWM 2009 Sales by Customer (US $)1
Philip Morris Philip Morris
International Philip Morris USA International
1 4% 3% Other 1 8%
Other
3 0%
2 0%
BAT Philip Morris
11% USA
11%
China BAT
Im perial
3 8% 1 4%
5% China
8%
Japan Tobacco Im perial
9% 8% Japan Tobacco
11%
Source: SWM management
1 Sales include SWM’s $740 mm and its unconsolidated joint venture, CTM’s, sales of $32 mm
11

12. Strong Intellectual Patent Protection
Extensive and Expanding Patent Portfolio
• 150 patents granted (80 patents pending) (1)
– Covers cigarette Papers, RTL and cigar wrapper/binder products/processes
Industry-Leading LIP Patent Protection
• 59 patents plus 18 patents pending and 261 Independent Claims covering LIP
– Patent portfolio provides first-mover advantage and significant barriers to
entry
– Establishes SWM as the world's leading independent producer of papers
used for LIP cigarettes
– Covers all major components of LIP production: smoking article, wrapper
and process
• Smoking article = 78 Independent Claims in 32 countries
• Wrapper = 84 Independent Claims in 32 countries
• Process = 99 Independent Claims in 30 countries
– Patent life exclusivity expiring 2017 through 2022
12
(1) As of 12/31/09

13. Agenda
Overview of Schweitzer-Mauduit
Successfully Restructured Operations
Reconstituted Tobacco Leaf (RTL)
Low Ignition Propensity Tobacco Paper
Financial Review
13

14. Significant Base Paper Turnaround Implemented
SWM Restructuring Cash Costs & Benefits
• Significant transformation and improvement
$40
executed in base paper manufacturing profile:
37
$35 35
• Over $67 million in one-time cash costs invested
– Additional $50 million of non-cash one-time costs
31
$30 • $35 million run-rate operating income benefit
– $17 million realized in 2009
$25
• Base papers restored to profitability in 2009
$ Millions
$20 • Restructuring implemented in France and the
Americas due to excess manufacturing capacity
15.3 17
$15 – PDM (France) shutdown 3 paper machines
10.2 12 11 – Lee (U.S.) shut down facility
$10
– Brazil restructured – exited coated papers
4.8 – Transferred paper production from U.S. to Brazil
$5
– Malaucène (France) closing facility
$0
– France – announced general staff reduction
2006 2007 2008 2009 2010e 2011e – Spotswood (U.S.) shutting down paper machine
Cash Restructuring Costs Operating Profit Benefit
Source: SWM management 14

15. Agenda
Overview of Schweitzer-Mauduit
Successfully Restructured Operations
Reconstituted Tobacco Leaf (RTL)
Low Ignition Propensity Tobacco Paper
Financial Review
15

16. RTL Represents a Key Long-Term Growth Driver
• Today SWM accounts for over 50% of global RTL
production Global RTL Market Positioning (ex. China)
– SWM’s expects market share to grow with Asia expansion
• RTL represents 10-15% of the tobacco blend of KTG
American cigarettes 7%
Japan
Tobacco
• Global RTL demand of approximately 150K tons (ex. 11%
China), growing ~ 3% per year
Philip Morris SWM
– 80% of RTL consumption in North America and Europe USA 53%
11%
– 70K tons used in China – 150K tons by 2015 will drive
long-term growth (up from zero in 2004)
Reynolds
– Robust growth to be driven by all of Asia 17%
• Regulatory efforts to reduce tar / nicotine delivery in
cigarettes drives demand
– Chinese government currently working to reduce tar /
nicotine levels – efforts will effectively double market Total: 150K MT
• Phased into tobacco blends very slowly by cigarette
manufacturers
Source: SWM management
16

17. Overview of the Reconstituted Tobacco Process
Key Benefits Tobacco By-
Products Water
• Batch process for each tobacco
blend (e.g. Marlboro)
• RTL adds consistency, flavor
and other key attributes for
cigarette manufacturers
Separation
• Reduced total cost for cigarette
production by off-setting new
tobacco cost Fibrous Soluble
Portion Portion
• SWM acts only as a tolling agent
in the process
Web formation Concentration
– SWM does not take on
product ownership and
maintains no raw material
cost risk
Reconstituted tobacco
Similar manufacturing process to paper products creates a uniform high quality
product for customers
17

18. Significant Strategic Advantages in RTL
• SWM is the sole independent RTL manufacturer globally
– Limited competition from “in-house” producers drives highly attractive
market share
• Growth prospects better than broader cigarette paper market and
exceed cigarette production growth
– Attractive growth prospects for RTL in Asian markets through SWM’s
planned projects in the Philippines and China
– Beneficial global regulatory changes in process
• Attractive margins, given RTL is essentially a tolling operation
18

19. Opportunities to Expand the RTL Franchise Globally
SWM RTL Supply Outlook • Philippines project an estimated $117
140,000 million investment
– Production to begin in late 2011
120,000 – Potential $65 - $70 million annual
revenue
100,000
– Run-rate operating profit margins
exceeding 40%
– >20% project rate of return
80,000
Metric Tons
• China Joint Venture an estimated $25
60,000 million equity investment
– Total investment estimated at $135 -
$140 million
40,000
– Two-year construction period
20,000
0
11
14
12
13
15
10
08
06
09
05
07
20
20
20
20
20
20
20
20
20
20
20
Base RT L (France) Philippines China JV¹
19
¹ China JV reflects 100% of venture’s projected sales volume

20. Overview of SWM’s Planned RTL Expansion in Asia
• Planned Asian facility additions in the Philippines and China expected to add
approximately 30,000 MT annual RTL capacity each
• Anticipated two-year construction period for each facility – Philippines to finish in 2011
Philippines Facility China Joint Venture
• Driven by demand from multiple leading • Driven by initiation of RTL use in Chinese
customers for second source of RTL production market – robust future growth opportunity
– Agreement reached with Japan Tobacco; pre-sold – Response to Chinese regulatory driven need for RTL
33% of capacity
– Approximately 67% of output to supply two cigarette
– Advanced discussions with second customer ongoing, companies that will be partners in the JV
which would raise pre-sold capacity to ~50%
• Standalone site in Yuxi, Yunnan province
• Standalone site Manila-area industrial park
–China’s largest tobacco region
– Economic development zone
• Estimated $25 million equity investment
• Estimated $117 million investment needed
–Total estimated investment of $135-$140 million
–Financed two-thirds with local debt
20

21. Agenda
Overview of Schweitzer-Mauduit
Successfully Restructured Operations
Reconstituted Tobacco Leaf (RTL)
Low Ignition Propensity Tobacco Paper
Financial Review
21

22. LIP Market a Long-Term “Game Changer” for SWM
• Increasing LIP adoption driven by
governmental regulation
Global LIP Market Development
– Only current viable technology with market (000 metric tons)
acceptance 55
5 0.3
• Represents a high-margin product driven by 50
46.4
technological advantages 45
– Extensive portfolio of SWM patents and trade 40
secrets
35
LIP Volume
• SWM currently produces two approved LIP 30 27 .1
products
25
– Online product developed with Philip Morris
20 17 .6
– Offline product manufactured at Newberry (U.S.)
15
facility and a third party converter
9.4
10
5.5
5 2.5
1.5 1.5
Areas of low air diffusion
0
E
E
E
E
E
08
06
09
05
07
11
14
12
13
10
20
20
20
20
20
20
20
20
20
20
Canada US
Australia / Finland EU
S. Africa / S. Korea
Source: SWM management 22

23. Regulatory Backdrop Favors LIP: Global Adoption
• North American LIP compliance requirements • Australia LIP regulation effective March
now at 100% 2010, Finland in April 2010
• EU nations have initiated LIP regulatory process • South Africa, South Korea and the
– Potentially 2x North American market size Philippines considering regulation
– Likely effective starting in 2011 • Substantial margin improvement potential
Growing Global Commitment to LIP Paper
Regulation in Place Regulation Pending
Source: SWM management
23

24. Agenda
Overview of Schweitzer-Mauduit
Successfully Restructured Operations
Reconstituted Tobacco Leaf (RTL)
Low Ignition Propensity Tobacco Paper
Financial Review
24

25. First Quarter 2010 Financial Highlights
(Amounts in Millions, Except Per Share
Amounts) 1Q10 1Q09
Net Sales $193.0 $184.1
Net Income (1) $18.6 $13.3
Net Income (2) $21.8 $13.5
Adjusted EBITDA (2) $41.7 $30.7
Cash from Operations $31.4 $11.8
Diluted Earnings
per share (2) $1.19 $0.88
Total Assets $771.5 $688.2
Net Debt $(21.3) $158.4
(1) Includes restructuring and impairment
(2) Excludes restructuring and impairment
25

26. SWM Financial Performance Over Time
(US$ in millions)
$142
Adj. Operating Profit Adj. EBITDA
$103
$75 $73
$58 $42
$42 $39 $34
$26
2006 2007 2008 2009 YTD 2010 2006 2007 2008 2009 YTD 2010
Adj. Earnings Per Share Free Cash Flow¹
$4.25
$33
$29
$15
$1.20 $1.19
$0.97 $5
$0.83 $(17)
YTD 2010
2009
2006 2007 2008 2009 YTD 2010 2006 2007 2008
Note: Adjusted financials exclude restructuring and impairment expenses
1
Free cash flow defined as operating cash flow less capital and software spending less dividends.
26

27. Capital Structure & Liquidity Overview
2010 Cash Uses:
• Dividends – $0.15 per quarter (unchanged since second quarter of 1996)
• Capital spending expected to be $105 - $115 million, which includes $60 - $70 million for Philippines RTL
project and $25 million for European LIP projects
• Projected equity injection for China RTL JV of $13 - $20 million
• Restructuring-related severance payments expected to be $35 - $40 million
• Other cash needs expected to be $13 - $20 million (including capitalized software spending)
(US$ in millions) Capital Structure
Amount at
Facility 3/31/2010 Debt Maturity Profile
U.S. Revolver $--
Euro Revolver 34
French Employee Profit Sharing 10
Bank Overdraft 3 $34
Other 2
Total Debt $49
$6 $3
$2 $4
Less: cash $70
2010 2011 2012 2013 2014
Net Debt $(21)
27
Source: Company public filings, SWM management

28. Key Takeaways
• Leading global full-line supplier in the tobacco-related papers industry
• Strong global market position
• Leading position in growing Asian markets
• Focus on high value-added sectors of the market
• Reputation for premium quality and service
• Unique research and development expertise
• History of profitability and earnings
• Strong cash flow and prudent capital structure
• Repositioning through restructuring for future earnings improvement
• Dynamic management team with significant industry experience
28

29. Appendix / Additional Slides
Appendix / Additional Slides
29

30. Regulation G
Certain financial measures and comments contained in this presentation
are “non-GAAP” financial measures, specifically measurements which
exclude restructuring expenses. We believe that investors’ understanding
is enhanced by disclosing financial measurements without restructuring
expenses as a reasonable basis for comparison of our ongoing results of
operations.
30

31. Reconciliations of non-GAAP Measures
(US$ in millions)
Adjusted Operating Profit: 2006 2007 2008 2009 YTD 2010
Operating Income 5.3 17.9 16.9 53.0 29.1
Plus: Restructuring & Impairment Expense 21.1 24.0 22.1 50.2 4.8
Adjusted Operating Profit 26.4 41.9 39.0 103.2 33.9
Adjusted EBITDA: 2006 2007 2008 2009 YTD 2010
Net income attributable to SWM $ (0.8) $ 3.4 $ 0.7 $ 35.6 $ 18.6
Plus: Interest expense 5.5 5.9 10.5 4.8 0.4
Plus: Tax provision (benefit) (4.2) 0.5 (1.9) 12.7 9.7
Plus: Depreciation & amortization 38.2 39.2 47.4 43.9 10.0
Less: Amortization of deferred revenue (5.9) (6.0) (5.8) (5.1) (1.8)
Plus: Minority interest in earnings of subsidiaries 4.1 8.0 0.2 - -
Plus: Restructuring & impairment expense 21.1 24.0 22.1 50.2 4.8
Adjusted EBITDA $ 58.0 $ 75.0 $ 73.2 $ 142.1 $ 41.7
Adjusted Earnings Per Share: 2006 2007 2008 2009 YTD 2010
Diluted net income per share $ (0.05) $ 0.22 $ 0.05 $ 2.20 $ 1.02
Plus: Restructuring and impairment expense per share 0.88 0.98 0.92 2.05 0.17
Adjusted net income per share $ 0.83 $ 1.20 $ 0.97 $ 4.25 $ 1.19
Free Cash Flow: 2006 2007 2008 2009 YTD 2010
Cash flow from operations 51.8 71.3 33.3 63.4 31.4
Less: Capital spending (9.6) (47.7) (35.3) (15.3) (9.9)
Less: Capitalized software costs (3.8) (8.9) (6.4) (5.5) (2.7)
Less: Cash dividends paid (9.4) (9.4) (9.4) (9.6) (2.7)
Free Cash Flow $ 29.0 $ 5.3 $ (17.8) $ 33.0 $ 16.1
31

32. Changes in Operating Profit
FY 2008 FY 2009 YTD 2010
Without Without
$ Millions Restructuring As Restructuring
Without
As Reported As Reported Restructuring
and Reported and
and Impairment
Impairment Impairment
Prior Year
$ 17.9 $ 41.9 $ 16.9 $ 39.0 $ 22.8 $ 23.1
Operating Profit
Changes by
Segment
France (10.0) (3.4) 6.6 30.5 2.2 6.6
Brazil (6.4) (3.6) 17.1 13.9 (1.4) (1.4)
United States 14.3 3.0 24.1 31.5 3.6 3.7
Corporate 1.1 1.1 (11.7) (11.7) 1.9 1.9
Operating Profit $ 16.9 $ 39.0 $ 53.0 $ 103.2 $ 29.1 $ 33.9
% Change from
-5.6% -6.9% N.M. N.M. N.M. N.M.
Prior Year
32

33. Profit Comparison
• Operating Profit Comparison (1)
40
$1 .4
35 $0.3
$7 .9 $0.8 $1 .0
30
25 $4.8
$1 .7
$0.1
20
$33.9
15
$23.1
10
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33
(1) Operating profit excludes restructuring and impairment expense.

34. Changes in Net Sales in Relation to EPS
Currency $9
Price/Mix 10
Volume (10)
$768
800
$670 $715
$658 $655
700 $566
$567
600
$501
$ Millions
500
400
300
200
$184 $193
100
0
2002 2003 2004 2005 2006 2007 2008 2009 Q 1 2010
EPS(1) $2.17 $2.28 $2.36 $1.26 $0.83 $1.20 $0.97 $4.25 $1.19
(1) Excludes restructuring and impairment 34

35. Manufacturing Cost Components – 2009
Labor
28%
Other Wood Pulp
32% 8%
Energy
1 3%
V eg. Fiber D,T,I Chemicals
5% 8% 6%
35

36. Capital Spending
EU LIP
$100
Average
PdM Restructuring
$90
LTRI No. 3
$80
Banded Cigarette Paper
$70
Philippine RTL
$60
s
Brazil #6 PM
illion
$50
M
$40
$30
$20
$10
$0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010e
36

37. Safe Harbor Statement
• This presentation may contain “forward-looking statements.” All
statements that address operating performance, events or
developments that we expect or anticipate will occur in the future are
forward-looking statements. Caution should be taken not to place
undue reliance on any such forward-looking statements because actual
results may differ materially from the results suggested by these
statements. We undertake no obligation to publicly update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise. In addition, forward looking
statements are subject to certain risks and uncertainties that could
cause actual results to differ materially from our historical experience
and present expectations or projections. These risks and uncertainties
include, but are not limited to, those described in Part I, “Item 1A. Risk
Factors” and elsewhere in our Annual Report on Form 10-K for the
year ended December 31, 2009 and those described from time-to-time
in our periodic and other reports filed with the Securities and
Exchange Commission.
37