This document provides a year-end report and outlook for 2011 from Billerud AB. It summarizes that while Billerud achieved a 6% increase in net sales in 2011, earnings declined due to price pressure and higher costs in the second half of the year. It also announces the acquisition of UPM-Kymmene's packaging paper business in Finland, which will strengthen Billerud's packaging offerings and reduce its market pulp exposure.

1. 1
YEAR-END REPORT | JANUARY-DECEMBER 2011
Per Lindberg, CEO and President, and Susanne Lithander, CFO | 1 February, 2012

2. 2
AGENDA
• Highlights
• Development by Business Area
• Financials
• Outlook
• Acquistion of UPM-Kymmene’s packaging paper business

3. 3
HIGHLIGHTS IN 2011
• 6% increase in net sales vs. 2010
• 10% operating margin
• Return on capital employed of 20%
• Significant price increases achieved
‒ Price increase of MSEK 943 (local currency) vs. 2010
• 4% increase in sales volumes vs. 2010
• Higher wood costs
• Changed market environment in H2 2011

4. 4
INCREASED RESULTS FOR PACKAGING PAPER
73 94
276
64
688
820
0
200
400
600
800
1 000
1 200
2010 2011
Currency hedging, other, etc
Market Pulp
Packaging paper
1 037
+19%
Operating profit breakdown, MSEK
978
Operating profit breakdown, %
7% 10%
27%
6%
66%
84%
0%
20%
40%
60%
80%
100%
2010 2011
Currency hedging, other, etc
Market Pulp
Packaging paper

5. 5
HIGHLIGHTS IN Q4 2011
• Weak earnings
‒ Operating profit of MSEK 75, margin 4%
• Price pressure
‒ ~4% lower prices in local currency for packaging paper
‒ ~125 USD/tonne price drop for NBSK pulp in Europe
• Periodical maintenance stop at Gruvön mill
• Order situation for packaging paper at lower levels than normal
‒ Uncertainty about demand, signs of more stable development
• Market-related shutdowns increasingly implemented vs. Q3 2011
• Seasonally higher fixed costs vs. Q3 2011

6. 6
PACKAGING &
SPECIALITY PAPER
Kraft & Sack Paper
PACKAGING BOARDS
S/C Fluting, Liner, Liquid Board
MARKET PULP
Nordic Bleached
Softwood Kraft Pulp
BUSINESS AREAS & SEGMENTS
Note: Graph shows sales breakdown per business area for 2011.

7. 7
PACKAGING & SPECIALITY PAPER
Market situation in Q4 2011
• Order situation stable but at an low level
• Customers continued to focus on reducing stock levels
• Market-related production shutdowns implemented to
restore market balance
• Price pressure continued
‒ Price level in local currency deteriorated for all products vs.
Q3 2011

8. 8
PACKAGING & SPECIALITY PAPER
Financials – Q4 2011 vs. Q3 2011
• Operating profit down by MSEK 78
• Mainly due to lower prices but also to
higher costs
0
20
40
60
80
100
120
140
160
Q4 -10 Q1 -11 Q2 -11 Q3 -11 Q4 -11
Operatingprofit,MSEK
Q4 -11 Q3 -11 Q4 -10 FY 2011
Net sales, MSEK 941 1,056 1,020 4,293
Operating profit, MSEK 65 143 131 450
Operating margin, % 7 14 13 10

9. 9
PACKAGING BOARDS
Market situation in Q4 2011
• Order situation at lower levels than normal
• Order situation continued to weaken
• Customers reduced their stocks to a greater extent vs. Q3 2011
• Price pressure continued
‒ Lower prices in local currency for most products vs. Q3 2011

10. 10
PACKAGING BOARDS
Financials – Q4 2011 vs. Q3 2011
• Operating profit down by MSEK 59
• Increased costs and lower sales
volumes due to the periodic
maintenance shutdown at Gruvön
‒ ~60% of the total cost for the
shutdown
• Lower prices
0
20
40
60
80
100
120
140
Q4 -10 Q1 -11 Q2 -11 Q3 -11 Q4 -11
Operatingprofit,MSEK
Q4 -11 Q3 -11 Q4 -10 FY 2011
Net sales, MSEK 644 696 648 2,772
Operating profit, MSEK 60 119 122 370
Operating margin, % 9 17 19 13

11. 11
MARKET PULP
Market situation in Q4 2011
• Pulp market continued to weaken vs. Q3 2011
• Several non-integrated NBSK producers implemented
market related production shutdowns
• Price in Europe fell to ~825 USD/tonne at end of Q4 2011
from ~950 USD/tonne at end of Q3 2011

12. 12
MARKET PULP
Financials – Q4 2011 vs. Q3 2011
• Operating profit down by MSEK 54
• An improved currency situation
compensated partly for less
favourable prices in local currency
• Write-down of the value of finished
goods stocks due to lower pulp price
-30
-20
-10
0
10
20
30
40
50
60
Q4 -10 Q1 -11 Q2 -11 Q3 -11 Q4 -11
Operatingprofit,MSEK
Q4 -11 Q3 -11 Q4 -10 FY 2011
Net sales, MSEK 416 465 450 1,752
Operating profit, MSEK -24 30 53 64
Operating margin, % -6 6 12 4

13. 13
Q4 2011 IN SUM
• Weak earnings
• Price pressure
• Periodical maintenance stop at Gruvön mill
• Order situation for packaging paper at lower levels
than normal
• Market-related shutdowns increasingly implemented
vs. Q3 2011
• Seasonally higher fixed costs vs. Q3 2011

14. 14
FINANCIAL INFORMATION

15. 15
QUARTERLY KEY FIGURES
Q4 -11 Q3 -11 Q4 -10
Net sales, MSEK 2,086 2,327 2,279
Operating profit, MSEK 75 296 326
Operating margin 4% 13% 14%
Profit/share, SEK 0.44 2.03 2.19
Net debt/equity ratio -0.05 -0.03 0.03
Sales volume (ktonnes) 315 335 323

16. 16
OPERATING PROFIT BRIDGE Q4 2011 vs. Q3 2011
* Includes product mix.
296
75
-26
-111 -7
-24
-63
+10
0
50
100
150
200
250
300
350
Operating
profit
Q3 2011
Sales &
production
volumes*
Selling prices
(in respective
sales currency)
Effects of
exchange rate
fluctuations,
incl. hedging
Change in
variable costs
Change in
fixed costs
Change in
depreciation
Operating
profit
Q4 2011
MSEK

17. 17
FULL YEAR KEY FIGURES
FY 2011 FY 2010 vs. 2010
Net sales, MSEK 9,343 8,828 +6%
Operating profit, MSEK 978 1,037 -6%
Operating margin 10% 12% -2p.p.
Profit/share, SEK 6.63 6.84 -3%
Net debt/equity ratio -0.05 0.03 +0.08
Sales volume (ktonnes) 1,354 1,307 +4%

18. 18
OPERATING PROFIT BRIDGE FY 2011 vs. FY 2010
* Includes product mix.
1 037 978
+22
+943
-608
-243
-92 -4
0
500
1 000
1 500
2 000
2 500
Operating
profit
2010
Sales &
production
volumes*
Selling prices
(in respective
sales
currency)
Effects of
exchange rate
fluctuations,
incl. hedging
Change in
variable costs
Change in
fixed costs
Change in
depreciation
Strike
compensation
Operating
profit
2011
MSEK
-77

19. 19
FINANCIAL TARGETS
0%
2%
4%
6%
8%
10%
12%
14%
2007 2008 2009 2010 2011
Operating margin
Operating margin
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
2007 2008 2009 2010 2011
Organic growth
Organic growth
0%
5%
10%
15%
20%
25%
2007 2008 2009 2010 2011
Return on capital employed
WACC before tax
Return on investment

20. 20
FINANCIAL TARGETS
DividendNet debt/equity ratio
-20%
0%
20%
40%
60%
80%
100%
2007 2008 2009 2010 2011
Net debt/equity ratio
0%
10%
20%
30%
40%
50%
60%
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2007 2008 2009 2010 2011
SEK
Dividend per share, SEK
Dividend payout ratio, %

21. 21
CASH FLOW GENERATION FROM OPERATION
1) Minus equals increase in net debt
MSEK
Q4 -11 Q3 -11 Q4 -10 2011 2010
Operating surplus, etc 238 464 583 1,604 1,625
Change in working capital, etc. 48 83 -115 -113 -147
Net financial items, taxes, etc. -12 -16 -7 -219 -85
Cash flow from operating
activities
274 531 461 1,272 1,393
Current net investments -178 -121 -81 -510 -331
Operating cash flow 96 410 380 762 1,062

22. 22
Electricity index (Sweden*) Wood price index
Source: Nordpool. *Price area Sweden Source: Billerud
MARKET PRICES AFFECTING RESULT

23. 23
MARKET PRICES AFFECTING RESULT
Market pulp (USD/t) TCW index*
Note: Average price for the quarter Source: Riksbanken *Total Competitiveness Weights Index

24. 24
CURRENCY SITUATION
Average hedged currency rates (share of net flow)
Q1 -12 Q2 -12 Q3 -12 Q4 -12 Total 12
months
9.35 9.19 9.22 9.19 9.26
(92%) (68%) (41%) (17%) (54%)
6.65 6.71 6.79 6.90 6.71
(92%) (60%) (41%) (19%) (53%)
10.59 10.56 10.68 10.75 10.61
(85%) (60%) (38%) (15%) (50%)
Note: Data in table and graph are as of 31 December 2011. *As of 31 December 2011.
• Profit effect of net flow hedging MSEK 44 (79) for Q4 2011 and
MSEK 190 (344) for FY 2011
• Market value of outstanding contracts not relating to accounts
receivable was MSEK 17*
Hedge level 12 months forward:
50%
53%
54%
GBP
USD
EUR

25. 25
OUTLOOK

26. 26
OUTLOOK
• At present there is uncertainty about the order situation for
the Group in the first part of 2012. However, the market is
showing signs of more stable development
• Continued price pressure is expected for the packaging
paper segments at the beginning of 2012
• If required, market-related production shutdowns will be
implemented in order to restore the balance in the market

27. 27
THE NATURAL PART IN
SMARTER PACKAGING
ACQUISITION OF UPM-KYMMENE’S PACKAGING PAPER OPERATION | FEB 2012

28. 28
ACQUISITION OF UPM-KYMMENE’S PACKAGING
PAPER OPERATION
• Billerud Finland Oy, a wholly-owned subsidiary to Billerud AB, has
signed an agreement with UPM-Kymmene (UPM) to acquire
UPM’s packaging paper operation in Pietarsaari and Tervasaari,
Finland
• Transaction amount is MEUR 130 (SEK ~1.2bn)
• Expected to be cash flow positive from closing
• Earnings per share is expected to increase with approximately
SEK 1.20 including fully realized synergies
• The transaction is subject to approval by relevant competition
authorities

29. 29
EXCELLENT STRATEGIC FIT
• Strengthen Billerud’s platform within smarter packaging
− Complements Billerud’s existing product offerings
− Strengthen the development of future renewable packaging solutions
− World-class asset and product quality
• Significantly reduced pulp market exposure
‒ Around 85% of the current market pulp exposure virtually hedged
‒ Will decrease volatility in Billerud earnings
• Favourable impact on currency exposure
− Substantially increased cost base in EUR

30. 30
SYNERGIES AND FINANCIALS
• Annual net synergies of approximately MSEK 30
− Full effect from end of 2013
− Non-recurring costs in 2012 of approximately MSEK 22
− Allows for increased flexibility in production structure and product mix
• Financials 2011 for the acquired operation
− Sales: approximately MEUR 220 (SEK 2bn)
− EBITDA: approximately MEUR 18 (MSEK 165)
− EBITDA margin: approximately 8%

31. 31
ACQUIRED OPERATION
• PM1 in UPM’s Pietarsaari mill, Finland
− PM1 is physically integrated with one of the largest European pulp mills,
which remains in UPM’s ownership
− White and brown sack and kraft paper
− 200,000 tonnes in annual production capacity
• PM7 in UPM’s Tervasaari mill, Finland
− PM7 is non-integrated
− White and brown kraft paper
− 100,000 tonnes in annual production capacity
• Very efficient and well invested assets with low reinvestment needs
• Around 185 employees

32. 32
LONG-TERM AGREEMENTS SIGNED
• The acquired operation will continue to be dependent on supply
of raw materials from UPM
• Long-term agreements have been signed on commercial terms
between UPM and Billerud, including:
− Pulp
− Steam
− Electricity
− Mill services
• Pulp at market price

33. 33
FULLY FINANCED
• Transaction financed by a combination of cash at hand and debt
via existing credit facilities
• Net debt-to-equity (ND/E) ratio will increase by 24 percentage
points following the transaction
− After closing of the transaction, the Group’s net debt-to-equity is
expected to be below the financial target of 0.6-0.9 ND/E, all other
things being equal

34. 34
Q&A
We believe in embracing what is important to our customers, our company,
our employees and the environment. By always giving back more than we take,
we are building a company for future generations.