The document summarizes Metsä Group's financial results for 2020. Key points include: - Sales decreased to EUR 5.055 billion due to lower pulp prices, while operating result fell to EUR 368 million due to lower pulp prices and strikes in early 2020. - Profitability improved towards the end of the year as pulp and sawn timber prices increased. - The company advanced major investment projects and was granted an environmental permit for its new Kemi bioproduct mill.

1. Metsä Group’s Full Year Result 2020
Ilkka Hämälä
President and CEO
11 February 2021

2. • Sales EUR 5,055 million (2019: EUR 5,473 million)
• Operating result* EUR 368 million (EUR 495 million)
• Operating result* 7.3% of sales (9.0)
• Return on capital employed* 7.1% (9.6)
• Sales decreased due to lower sales prices of pulp
• Profitability decreased due to a decline in the sales prices of
pulp and the strikes in Finland in early 2020. The strikes had a
negative operating result impact of EUR 50 million
• Exchange rate fluctuations had a positive effect of EUR 51
million on the operating result
• Metsä Group advanced its investment projects as planned
Profitability improved towards
the end of the year
11.2.2021
Metsä Group – Result 2020
*comparable

3. • The price of long-fibre pulp increased and that of short-fibre
pulp remained stable compared to Q3/2020
• Paperboard deliveries were higher than in Q4/2019 and
declined seasonally from Q3/2020
• The market situation of sawn timber and veneer products
improved
• Environmental permit was granted to Kemi bioproduct mill
• A 30% share of Husum pulp mill in Sweden was divested to
Norra Skog. The final decision to renew the mill’s recovery
boiler and turbine was made
• The maintenance shutdowns postponed to the second half of
the year were implemented successfully
Events during the fourth quarter
11.2.2021
Metsä Group – Result 2020

4. 11.2.2021 4
Sales
Metsä Group – Result 2020
EUR million
4,658
5,040
5,709
5,473
5,055
0
1000
2000
3000
4000
5000
6000
2016 2017 2018 2019 2020

5. 11.2.2021 5
1,156 1,184
1,143
1,175
1,216 1,235 1,260
1,328
1,428
1,477
1,386
1,419 1,438
1,372 1,374
1,290
1,253
1,200
1,245
1,357
0
200
400
600
800
1 000
1 200
1 400
1 600
Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Sales quarterly
EUR million
Metsä Group – Result 2020

6. 11.2.2021 6
Comparable operating result
Metsä Group – Result 2020
EUR million
439
566
849
495
368
0
200
400
600
800
1000
2016 2017 2018 2019 2020

7. 11.2.2021 7
109
120
103 107
128
119
134
185
208 210
223
208
180
128
110
76
62
96
115
94
0
50
100
150
200
250
Q1/16 Q2 Q3 Q4 Q1/17 Q2 Q3 Q4 Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Metsä Group – Result 2020
EUR million
Comparable operating result, quarterly

8. 11.2.2021 8
Change in comparable operating result
Metsä Group – Result 2020
EUR million
Comparable operating result 1–12/2019 495
Sales prices -195
Sales volumes -44
Exchange rates (after hedging) 51
Change in wood raw material unit costs 34
Change in raw material, energy and other variable costs unit costs 67
Employee costs 8
Maintenance and other fixed costs -11
Change in inventories (including volume and valuation) -29
Depreciation and other -8
Comparable operating result 1–12/2020 368

9. 11.2.2021 9
Items affecting comparability
Metsä Group – Result 2020
EUR million 2020
OPERATING RESULT (IFRS) 375.8
Items affecting comparability:
Metsä Tissue / Items related to the sales of napkin business 1.3
Metsä Board / Sale of non-business related land area -6.0
Metsä Tissue / Insurance indemnity and divestment of fixed assets -3.3
Items affecting comparability, total -8.1
COMPARABLE OPERATING RESULT 367.7

10. 10.2
12.3
16.8
9.6
7.1
0
4
8
12
16
20
2016 2017 2018 2019 2020
11.2.2021 10
Comparable ROCE
Metsä Group – Result 2020
%
Target > 12%

11. 11.2.2021 11
Equity ratio
Metsä Group – Result 2020
43.9 45.0
53.1
56.2 57.2
0
10
20
30
40
50
60
2016 2017 2018 2019 2020
%

12. 11.2.2021 12
Interest-bearing net liabilities
Metsä Group – Result 2020
1,033
993
463
374
168
0
300
600
900
1 200
1 500
2016 2017 2018 2019 2020
EUR million

13. 11.2.2021 13
Capital expenditure
Metsä Group – Result 2020
762
631
274 260
401
0
200
400
600
800
1000
2016 2017 2018 2019 2020
EUR million
Includes investments in leased fixed assets.

14. 11.2.2021 14
Personnel
Metsä Group – Result 2020
9,300 9,126 9,310 9,265 9,213
0
3 000
6 000
9 000
12 000
2016 2017 2018 2019 2020

15. • The benefits of digital business were highlighted
in the pandemic. Half of the wood acquired from
private forest owners was purchased digitally
• Harvesting and transportation conditions in
Finland were normal, but the harvesting of winter
stands started only in December
• Deliveries were carried out smoothly. Wood was
delivered 32.7 million m3 (34.7)
• Wood prices were stable in the beginning of the
year, but the prices of log wood began to rise
during Q4/2020
11.2.2021 15
Wood deliveries progressed well
Metsä Forest – Wood Supply and Forest Services
Sales and comparable operating result
EUR million
490 496
471
526 526
508
474 465
431
471
449
469
8.7
5.8
8.9 8.9
11.3
5.6
5.0
5.6
3.4
3.9
6.2
8.9
0
3
6
9
12
15
18
0
100
200
300
400
500
600
Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Sales Operating result

16. • Market situation improved towards the end of
the year
• Profitability improved due to lower raw material,
energy and labour costs and the improved result of
the UK business
• The strike at Finnish mills and the pandemic
weakened profitability
• The delivery volumes of Kerto LVL and spruce
plywood declined slightly, but the delivery volumes
of birch plywood increased
11.2.2021 16
Full-year profitability of wood products improved
Metsä Wood – Wood Products Industry
Sales and comparable operating result
EUR million
109
119
106 108 111
119
111
93
87
104
122
117
6.2
5.5
2.8
2.2 1.8
3.3 3.1
-1.1
-3.3
1.3
6.6
4.7
-4
0
4
8
12
16
20
-30
0
30
60
90
120
150
Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Sales Operating result

17. • Demand for pulp strengthened in Q4/2020,
particularly in China, and prices in Asia began to
increase. Europe follows Asia with a delay
• Demand for sawn timber, which had slowed down
at the beginning of the year, picked up towards the
end of the year in all main markets
• The USD-denominated average market prices of
long-fibre pulp in 2020 decreased by 14% in
Europe and by 7% in China
• Construction of the pine sawmill in Rauma
progressed as planned
• The investment decision for the Kemi bioproduct
mill was made in February 2021
11.2.2021 17
Market situation for pulp and sawn timber is recovering
Metsä Fibre – Pulp and Sawn Timber Industry
Sales and comparable operating result
EUR million
601
629 609
630 623
556 567
490
412 428
459
528
144.9
164.9
187.0
172.0
122.4
83.1
33.2
9.9
-21.3
16.0 17.1
-8.0
-40
0
40
80
120
160
200
240
280
-100
0
100
200
300
400
500
600
700
Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Sales Operating result

18. 400
600
800
1000
1200
1400
400
600
800
1000
1200
1400
´12 ´13 ´14 ´15 ´16 ´17 ´18 ´19 ´20
Hardwood/EUR Softwood/EUR Hardwood/USD Softwood/USD Softwood/China/USD
11.2.2021 18
Price of pulp (PIX) in Europe and China
Metsä Fibre – Pulp and Sawn Timber Industry
USD EUR
Source: Fast Markets Foex

19. • Profitability was improved by lower production
costs and a positive exchange rate development
• The result was burdened by the Finnish paper
workers’ strike at the beginning of the year
• Metsä Board divested a 30% share of Husum pulp
mill to Norra Skog
• The investment decision for the first phase of the
renewal of the Husum pulp mill was made in
December 2020
• In January 2021, Metsä Board initiated pre-
engineering to increase the folding boxboard
production capacity by 200,000 tonnes at the
Husum mill in Sweden
11.2.2021 19
The operating result of the paperboard industry
improved clearly from the previous year
Metsä Board – Paperboard Industry
492
519
475
458
487 477 489 478 472 473 471 473
69.0
59.2
64.0
60.0 61.8
41.0 42.5
39.1
33.8
60.5 62.5 64.5
0
20
40
60
80
100
120
0
100
200
300
400
500
600
Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Sales Operating result
Sales and comparable operating result
EUR million

20. 500
600
700
800
900
1000
1100
1200
500
600
700
800
900
1000
1100
1200
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Folding boxboard
White-top kraftliner
11.2.2021 20
Paperboard market price development in Europe
Metsä Board – Paperboard Industry
EUR/ tonne
Sources: Fastmarkets RISI & Fastmarkets FOEX
EUR/ tonne

21. • Operating profit was improved by efficiency
measures and lower variable costs
• After the strong growth caused by the pandemic,
demand started to decline, but picked up again
towards the end of the year
• Demand for greaseproof papers remained good
• The divestment of the napkin business was
completed at the beginning of the year
• Metsä Tissue renews a tissue paper machine at its
Mänttä mill
• In the spring of 2020, the company initiated an
environmental permit procedure for the renewal of
the Mariestad mill in Sweden
11.2.2021 21
Clear result improvement in tissue and
greaseproof papers
Metsä Tissue – Tissue and Greaseproof Papers
259 256 254
270 267 266 263 264
293
224
237
258
12.3 11.5
6.4 6.1
10.5
13.5
22.8
26.6
40.5
23.6 22.7
27.1
0
8
16
24
32
40
48
0
50
100
150
200
250
300
Q1/18 Q2 Q3 Q4 Q1/19 Q2 Q3 Q4 Q1/20 Q2 Q3 Q4
Sales Operating result
Sales and comparable operating result
EUR million

22. • Demand for Kerto LVL remains strong, particularly in North
America and Australia. Demand for softwood plywood is strong.
Competition in the birch plywood continues to be tough in Europe
• The rise in softwood pulp prices that began at the end of 2020
has continued during Q1/2021. Demand for pulp is growing,
particularly in Asia. Demand for sawn timber remains strong
• Paperboard deliveries are expected to increase in Q1/2021
compared to Q4/2020. Linerboard prices are expected to rise
and folding boxboard prices to remain stable
• Demand for tissue paper is expected to grow as pandemic
restrictions are lifted. Demand for greaseproof papers is expected
to continue in growth trend
11.2.2021 22
Market outlook
Summary

23. Metsä Group’s comparable operating result
is in the first quarter of 2021 expected to
improve from the fourth quarter of 2020
11.2.2021 23
Near-term
result outlook
Summary

24. • Increase of the value of Finnish forests
• Profitable growth together with customers
• Reduction of fossil fuel consumption
• Increase of renewable energy production
• Replacing fossil materials with renewables
• Higher amount of carbon stored in wood based products
that have a long life span
11.2.2021 24
Metsä Group’s main
strategic objectives

25. 25
Being a forerunner requires investments
2015–2018: Investments of EUR 2 billion 2019–2023: Investments of EUR 2.5 billion
Äänekoski bioproduct mill
Punkaharju, Lohja and
Pärnu mills
Husum
paperboard machine
11.2.2021
Husum pulp and
paperboard mills
Textile fibre
demo plant
Kemi
linerboard mill
Kemi
bioproduct mill
Rauma sawmill

26. • Strong customer demand for the new capacity
• Wood sourcing plans finalized
• Finnish State’s investments to logistics
infrastructure ensure improved transportation of
raw materials and products
• Permissions to commence operations granted
• Financing agreed
• Good and active cooperation with Finnish
government, authorities and other stakeholders
New EUR 1.6 billion
bioproduct mill will be
built in Kemi
11.2.2021

28. Your partner in profitable growth