- Metsä Group's sales and operating result increased in Q1 2022 particularly due to higher pulp prices. The demand for paperboard, sawn timber, LVL and plywood remained strong. - The profitability of tissue paper suffered from high energy costs. Investment projects progressed on schedule despite high cost inflation. - Metsä Group discontinued Russian operations and divested holdings in Finsilva and Hangö Stevedoring. Veolia will build a methanol plant using bioproduct mill side streams. - Market demand is expected to remain strong for pulp, paperboard, sawn timber and LVL, but cost inflation and uncertainties from Ukraine war and China pandemic create risks. Metsä Group

1. 28 April 2022
Metsä Group Interim report
Q1/2022
President and CEO Ilkka Hämälä

2. • Sales EUR 1,594 million (Q1/2021: EUR 1,400 million)
• Operating result* EUR 244 million (174)
• Operating result* 15.3% of sales (12.4)
• Return on capital employed* 15.8% (12.6)
• Sales and operating result increased particularly due to the higher
sales prices of pulp
• The paperboard market continued to strengthen. The demand for
sawn timber, LVL and plywood remained good
• The profitability of tissue paper business suffered from the cost
inflation caused by energy prices
• The investment projects progressed as planned, although cost
pressure remains high
28 April 2022 2
Very strong result for Metsä Group
Metsä Group – Q1/2022
*Comparable

3. • Metsä Group discontinued wood sourcing and sawn timber
production in Russia, as well as paperboard and tissue paper
sales to Russia and Belarus
• Metsä Group divested its holding in Finsilva
• Metsä Board sold the entire share capital of Hangö Stevedoring
to Euroports Finland
• Veolia announced to build a crude methanol refinery at the
Äänekoski bioproduct mill site, utilising the mill’s side streams
3
Events during the first quarter
Metsä Group – Q1/2022
28 April 2022

4. 4
1,438
1,372 1,374
1,290
1,253
1,200
1,245
1,357
1,400
1,542 1,515
1,560 1,594
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4 Q1/21 Q2/21 Q3/21 Q4/21 Q1/22
Sales quarterly
EUR million
Metsä Group – Q1/2022
28 April 2022

5. 5
180
128
110
76
62
96
115
94
174
242
278
220
244
0
50
100
150
200
250
300
Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4 Q1/21 Q2/21 Q3/21 Q4/21 Q1/22
EUR million
Comparable operating result, quarterly
Metsä Group – Q1/2022
28 April 2022

6. 6
Change in comparable operating result
EUR million
Comparable operating result Q1/2021 174
Sales prices 205
Sales volumes -11
Exchange rates (after hedging) 3
Change in wood raw material unit costs -19
Change in raw material, energy and other variable costs unit costs -115
Employee costs -10
Maintenance and other fixed costs -6
Change in inventories (including volume and valuation) 19
Depreciation and other 5
Comparable operating result Q1/2022 244
Metsä Group – Q1/2022
28 April 2022

7. 28 April 2022 7
Items affecting comparability
EUR million Q1/2022
OPERATING RESULT (IFRS) 341
Items affecting comparability:
Divestment of the holding in Finsilva Oyj -78
Sale of the share capital of Oy Hangö Stevedoring Ab -19
Adjustment measures concerning Kemi Shipping Oy 1
Items affecting comparability, total -97
COMPARABLE OPERATING RESULT 244
Metsä Group – Q1/2022

8. 8
Comparable ROCE
Metsä Group – Q1/2022
16.6
13.8
4.9
12.6
15.8
0
4
8
12
16
20
Q1/2018 Q1/2019 Q1/2020 Q1/2021 Q1/22
%
Target > 12%
28 April 2022

9. 9
Equity ratio
53.1
56.2 57.2
61.1 59.9
0
10
20
30
40
50
60
70
2018 2019 2020 2021 Q1/22
%
Metsä Group – Q1/2022
28 April 2022

10. 10
Interest-bearing net liabilities
Metsä Group – Q1/2022
463
374
168
-185
-99
-200
0
200
400
600
800
2018 2019 2020 2021 Q1/22
EUR million
28 April 2022

11. 11
Capital expenditure
274 260
401
994
332
0
250
500
750
1000
1250
1500
2018 2019 2020 2021 Q1/22
Full-year
estimate
EUR million
Includes investments in leased fixed assets.
Metsä Group – Q1/2022
28 April 2022

12. 12
Personnel
Metsä Group – Q1/2022
9,310 9,265 9,213
9,533 9,409
0
3 000
6 000
9 000
12 000
2018 2019 2020 2021 Q1/22
28 April 2022

13. • Wood trade in private forests in Finland was weaker
than during Q1/2021
• The price of logs increased, and the price of
pulpwood was at the same level as Q1/2021
• Harvesting and transport conditions were excellent
• Deliveries to customers were carried out well,
excluding birch logs. A total of 9.0 million m3 (9.6) of
wood was delivered
• Ecological sustainability programme was expanded.
Rare natural broadleaved trees will not be felled in
the future
• Metsä Group pays a double bonus on thinned trees
purchased from members between May and August
2022
13
Wood deliveries were good
Metsä Forest – Wood Supply and Forest Services
Sales and comparable operating result
EUR million
431
471
449
469
517
507
497
503
517
3.4
3.9
6.2
8.9
8.4
6.7
11.3
10.0
5.6
0
3
6
9
12
15
18
380
400
420
440
460
480
500
520
540
Q1/20 Q2 Q3 Q4 Q1/21 Q2 Q3 Q4 Q1/22
Sales Operating result
28 April 2022

14. • Delivery volumes decreased but sales prices
increased clearly in all product categories
• Higher raw material, energy and logistics prices and
challenges in the availability of birch logs affected
profitability negatively
• The weak market situation for products of the UK
upgrading business continued
• Change negotiations were conducted at the plywood
mills for adjusting the birch plywood production
• The planning of Kerto LVL® mill in Äänekoski is
progressing. The local administrative court’s
decision on the local detailed plan is expected
during 2022
14
Profitability of Wood Products Industry improved
Metsä Wood – Wood Products Industry
87
104
122
117
141
156
142 141
170
-3.3
1.3
6.6
4.7
7.0 6.8
5.4
-0.7
9.1
-4
0
4
8
12
16
20
24
-30
0
30
60
90
120
150
180
Q1/20 Q2 Q3 Q4 Q1/21 Q2 Q3 Q4 Q1/22
Sales Operating result
Sales and comparable operating result
EUR million
28 April 2022

15. • The result was improved by the higher sales prices
of pulp and sawn timber compared to Q1/2021
• The demand for softwood market pulp has remained
strong in Europe and at a good level also in China
• In sawn timber, demand remained good in Europe
and North Africa
• Metsä Fibre announced plans to end sawn timber
production in Kyrö
• The investment projects are progressing as
planned, although cost pressure continued. The
Rauma sawmill will start-up in Q3/2022
• The operations at the Svir sawmill in Russia
were discontinued
Strong performance of the Pulp and Sawn Timber
Industry continued
Metsä Fibre – Pulp and Sawn Timber Industry
412 428
459
528
561
652
693
722
673
-21.3
16.0 17.1
-8.0
72.1
168.0
225.9
182.3
155.4
-40
0
40
80
120
160
200
240
280
320
-100
0
100
200
300
400
500
600
700
800
Q1/20 Q2 Q3 Q4 Q1/21 Q2 Q3 Q4 Q1/22
Sales Operating result
Sales and comparable operating result
EUR million
28 April 2022 15

16. • The operating result improved especially due to
higher paperboard prices
• The increased price level of market pulp improved
profitability as well
• Cost inflation continued and profitability was
strained by the increased prices of chemicals,
energy and logistics, in particular
• The investments in Husum and Kemi are
progressing as planned. The recovery boiler and
turbine of the Husum pulp mill will be in use in
Q3/2022
16
The paperboard market continued very strong
Metsä Board – Paperboard Industry
472 473 471 473
494
556
516 518
582
33.8
60.5 62.5 64.5
88.8
102.5 104.0
91.3
121.5
0
20
40
60
80
100
120
140
0
100
200
300
400
500
600
Q1/20 Q2 Q3 Q4 Q1/21 Q2 Q3 Q4 Q1/22
Sales Operating profit
Sales and comparable operating result
EUR million
28 April 2022

17. • The raw material and energy costs increased
significantly. The implemented tissue paper price
increases did not adequately offset the higher costs
• The sales volumes of tissue paper increased from
Q1/2021, especially in products for professional use,
as the pandemic restrictions were lifted
• The sales of greaseproof papers were slightly short
of the previous year’s figures
• The environmental permit of Mariestad investment
project is expected to be issued in H2/2022
17
Heavy cost inflation burdens the result of Tissue and
Greaseproof Papers
Metsä Tissue – Tissue and Greaseproof Papers
293
224
237
258
224 224
239
259 255
40.5
23.6 22.7
27.1
16.4
0.7
-3.7
-23.2
-18
-30
-15
0
15
30
45
60
75
90
-100
-50
0
50
100
150
200
250
300
Q1/20 Q2 Q3 Q4 Q1/21 Q2 Q3 Q4 Q1/22
Sales Operating profit
Sales and comparable operating result
EUR million
28 April 2022

18. • The war in Ukraine and the pandemic in China create uncertainties
in the market
• The demand for Kerto LVL and plywood remains good, as
construction remains robust
• The demand for softwood pulp is expected to remain good
• Sawn timber demand is expected to remain at a good level in
Europe, North Africa and Japan
• Paperboard demand is expected to remain good. The average
prices of folding boxboard and white kraftliners are expected to rise
• Tissue paper sales are expected to remain stable or increase
slightly, barring new pandemic restrictions
• Cost inflation is expected to continue
Market outlook
Summary
28 April 2022

19. Metsä Group’s comparable operating result
is in April–June 2022 expected to improve
from January–March 2022
Near-term result outlook
Summary
28 April 2022

20. Your partner is sustainble growth