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Valmet's Interim Review January-March 2015

In Q1 2015, Valmet experienced a decrease in orders received for pulp, energy, and paper segments, but an increase in orders received for services, leading to improved net sales in that area. The company reported a gross profit increase of EUR 16 million year-over-year, though SG&A expenses also rose, and the EBITA margin remains below target. Valmet maintains a strong balance sheet, with a negative net debt of EUR -134 million and an order backlog of EUR 2.1 billion, indicating stability despite negative cash flow from operating activities.

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Orders received increased in Services – focus continues to be on profitability improvement Interim Review, January–March 2015 April 29, 2015 Pasi Laine, President and CEO Markku Honkasalo, CFO
Agenda Q1/2015 in brief Business lines’ development Financial development Summary of Interim Review Q1/2015 Appendix 1 2 3 5 6 Interim Review, January–March 2015 Guidance and short-term market outlook4 April 29, 2015 © Valmet2
Q1/2015 in brief
• Orders received decreased in Pulp and Energy, and Paper business lines from the high levels in Q1/2014 • Net sales increased in Pulp and Energy and decreased in Paper compared with Q1/2014 Orders received decreased and net sales increased in capital business • Services orders received increased compared with Q1/2014 • Net sales increased compared with Q1/2014 in Services Orders received and net sales increased in services April 29, 2015 © Valmet4 Q1/2015 in brief • Gross profit increased by EUR 16 million compared with Q1/2014 • SG&A1 expenses increased by EUR 3 million compared with Q1/2014 • EBITA2-margin improved but is below targeted level Focus on profitability improvement Strong balance sheet, negative cash flow provided by operating activities • Net debt EUR -134 million, and gearing -17% • Cash flow provided by operating activities EUR -20 million • Order backlog EUR 66 million higher than at year-end 2014 Order backlog at EUR 2.1 billion 1) Selling, general and administrative expenses before non-recurring items 2) EBITA = Earnings before interest, taxes and amortization and non-recurring items
Key figures Q1/2015 April 29, 2015 © Valmet5 EUR million Q1/2015 Q1/2014 Change Orders received 580 1,101 -47% Order backlog1 2,064 1,972 5% Net sales 561 519 8% EBITA2 19 4 >100% % of net sales 3.5% 0.7% EBIT3 13 -8 % of net sales 2.4% -1.5% Earnings per share, EUR 0.05 -0.04 Return on capital employed (ROCE), before taxes4 6% -2% Cash flow provided by operating activities -20 43 Gearing1 -17% -5% Non-recurring items: EUR 0 million in Q1/2015 (EUR -6 million in Q1/2014) 1) At the end of period 2) Before non-recurring items 3) After non-recurring items 4) Annualized
267 273 242 273 293 622 560 96 66 138 212 190 128 142 149 1,101 1,023 466 480 580 0 500 1,000 1,500 2,000 2,500 3,000 3,500 0 200 400 600 800 1,000 1,200 1,400 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Services (LHS) Pulp and Energy (LHS) Paper (LHS) Last 4 quarters (RHS) 185 82 135 88 189 24 194 23 40 50 437 567 189 277 202 35 121 54 35 54 420 59 66 41 85 1,101 1,023 466 480 580 0 500 1,000 1,500 2,000 2,500 3,000 3,500 0 200 400 600 800 1,000 1,200 1,400 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 North America (LHS) South America (LHS) EMEA (LHS) China (LHS) Asia-Pacific (LHS) Last 4 quarters (RHS) Orders received declined from the high level in Q1/2014 • Orders received increased in Services • Orders received decreased in Pulp and Energy • Orders received decreased in Paper • Orders received increased in South America and China April 29, 2015 © Valmet6 Orders received (EUR million), by business line Orders received (EUR million), by area
1,972 2,406 2,312 1,998 2,064 0 500 1,000 1,500 2,000 2,500 3,000 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Order backlog at EUR 2.1 billion • About 75% of the order backlog is currently expected to be realized as sales during 2015 • Approximately 25% of the order backlog relates to the Services business line April 29, 2015 © Valmet7 Order backlog (EUR million) ~25% ~75% Services business Capital business Structure of order backlog
224 251 235 278 242 519 588 590 777 561 0.7% 3.7% 5.5% 6.1% 3.5% Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Services Capital EBITA-% EBITA target 6–9% EBITA-margin increased compared with Q1/2014 April 29, 2015 © Valmet8 Net sales and EBITA before NRI (EUR million) • Net sales and profitability increased compared with Q1/2014 - Changes in foreign exchange rates1 increased net sales by EUR 20 million and EBITA by EUR 1 million • Exceptionally many POC2 milestones in Q4/2014, while less in Q1/2015 EBITA before NRI (MEUR) 194 22 32 48 1) Compared with the exchange rates for January–March, 2014 2) POC = Percentage of completion
0% 5% 10% 15% 20% 25% 30% 35% 40% 0 20 40 60 80 100 120 140 160 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 EUR million (LHS) % of net sales (RHS) 0% 5% 10% 15% 20% 25% 30% 35% 40% 0 20 40 60 80 100 120 140 160 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 EUR million (LHS) % of net sales (RHS) Good development in gross profit April 29, 2015 © Valmet9 Gross profit (EUR million and % of net sales) • Gross profit increased • Selling, general and administrative expenses (SG&A) increased EUR 3 million, due to changes in foreign exchange rates1 • Further actions to improve gross profit through Must-Win implementation and renewal SG&A (EUR million and % of net sales) 1) Compared with the exchange rates for January–March, 2014
Key Must-Win objectives to improve profitability to the targeted level of 6–9% April 29, 2015 © Valmet10 Improve project and service margin  Harmonization of processes  Localization of competencies  Better selection of sales cases  Development in project management  Common quality development approach  Quality tools and processes  Highlight the importance of quality initiatives and accountability Reduce quality costs and lead times  Increase sourcing from cost competitive countries  Increase use of sub-contracting  Consolidation of shipment and warehouse network Savings in procurement Improve product cost competitiveness to increase gross profit  Focus on cost efficient design  Modularity and standardization
 The acquisition was announced on January 15, 2015 and completed on April 1, 2015  Enterprise value of acquisition EUR 340 million1  Automation is Valmet’s fourth business line  January–June Interim Review will include Automation April 29, 2015 © Valmet11 Automation is Valmet’s fourth business line 1) Refers to the debt-free enterprise value of the acquisition.
Business lines’ development
224 251 235 278 242 0 200 400 600 800 1,000 1,200 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net sales (LHS) Net sales, last 4 quarters (RHS) Growth in orders received and net sales in Services April 29, 2015 © Valmet13 Net sales (EUR million)Orders received (EUR million) • Services orders received increased compared with Q1/2014 - Orders received increased in North America, South America, EMEA and Asia- Pacific, and decreased in China - Orders received remained stable compared with Q1/2014 in Fabrics and increased in all other business units - Changes in foreign exchange rates1 increased orders received by approximately EUR 16 million • Net sales increased compared with Q1/2014 2014: EUR 1,055 million 2014: EUR 989 million 267 273 242 273 293 0 200 400 600 800 1,000 1,200 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Orders received (LHS) Orders received, last 4 quarters (RHS) 1) Compared with the exchange rates for January–March, 2014
622 560 96 66 138 0 200 400 600 800 1,000 1,200 1,400 1,600 0 100 200 300 400 500 600 700 800 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Orders received (LHS) Orders received, last 4 quarters (RHS) 181 229 234 312 222 0 200 400 600 800 1,000 1,200 1,400 1,600 0 50 100 150 200 250 300 350 400 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net sales (LHS) Net sales, last 4 quarters (RHS) Orders received decreased and net sales increased in Pulp and Energy April 29, 2015 © Valmet14 Net sales (EUR million)Orders received (EUR million) • Orders received decreased compared with Q1/2014 - Orders received increased in South America and North America, and decreased in other areas - Orders received decreased in both Pulp and Energy • Net sales increased compared with Q1/2014 2014: EUR 956 million 2014: EUR 1,344 million
212 190 128 142 149 0 150 300 450 600 750 900 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Orders received (LHS) Orders received, last 4 quarters (RHS) 114 108 120 186 97 0 150 300 450 600 750 900 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net sales (LHS) Net sales, last 4 quarters (RHS) Orders received and net sales decreased in Paper April 29, 2015 © Valmet15 Net sales (EUR million)Orders received (EUR million) • Orders received decreased compared with Q1/2014 - Orders received increased in China and South America and decreased in other areas - Orders received increased in Board and Paper, and decreased in Tissue • Net sales decreased compared with Q1/2014 • Timing of POC1 milestones had a negative impact on net sales in Q1/2015 2014: EUR 528 million 2014: EUR 671 million 1) POC = Percentage of completion
Financial development
43 46 117 30 -20 -40 -20 0 20 40 60 80 100 120 140 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Cash flow provided by operating activities negative due to net working capital development April 29, 2015 © Valmet17 • Change in net working capital was EUR -49 million1 • CAPEX less than depreciation Cash flow provided by operating activities (EUR million) 1) Change in net working capital in the condensed consolidated statement of cash flows
-39 -54 -158 -166 -134 -5% -7% -20% -21% -17% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% -250 -200 -150 -100 -50 0 50 100 150 200 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net debt (EUR million) Gearing (%) Strong balance sheet and negative gearing April 29, 2015 © Valmet18 • Negative gearing (-17%) and net debt EUR -134 million • Equity to assets ratio was negatively affected by drawn bank loans to finance the acquisition of Process Automation Systems, and by dividend payout decision of Annual General Meeting Net debt (EUR million) and gearing (%) Equity to assets ratio (%) 40% 40% 41% 42% 34% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Q1/14 Q2/14 Q3/14 Q4/14 Q1/15
0 50 100 150 200 250 300 350 400 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Structure of loans and borrowings April 29, 2015 © Valmet19 Amount of outstanding interest-bearing debt (EUR millions) • Average maturity of long-term loans is 4.1 years Main financing sources Back-up facilities Interest-bearing debt EUR 445 million as at March 31, 2015 EUR 147 million EUR 100 million European Investment Bank Skandinaviska Enskilda Banken Nordic Investment Bank Amount Lender EUR 70 million Swedish Export Kredit EUR 95 million EUR 0 million EUR 200 million domestic commercial paper program EUR 200 million syndicated revolving credit facility Amount Outstanding EUR 30 million
Guidance and short- term market outlook
Guidance and short-term market outlook 21 April 29, 2015 © Valmet Good Pulp and Energy Paper Satisfactory Pulp Energy Board and Paper Tissue Guidance for 2015 Services Short-term market outlook Guidance for 2015 (as given on February 6, 2015) Satisfactory Satisfactory Good Satisfactory Satisfactory Satisfactory Satisfactory Good Satisfactory Q2/2014 Q3/2014 Satisfactory Satisfactory Satisfactory Good Satisfactory Q4/2014 Satisfactory Weak Good Satisfactory Q1/2015 Valmet estimates that, including the acquisition of Process Automation Systems, net sales in 2015 will increase in comparison with 2014 (EUR 2,473 million) and EBITA before non-recurring items in 2015 will increase in comparison with 2014 (EUR 106 million). - - - SatisfactoryAutomation
Summary of Interim Review Q1/2015
April 29, 2015 © Valmet23 Summary of Interim Review Q1/2015 1) Selling, general and administrative expenses before non-recurring items 2) EBITA = Earnings before interest, taxes and amortization and non-recurring items • Orders received decreased in Pulp and Energy, and Paper business lines from the high levels in Q1/2014 • Net sales increased in Pulp and Energy and decreased in Paper compared with Q1/2014 Orders received decreased and net sales increased in capital business • Services orders received increased compared with Q1/2014 • Net sales increased compared with Q1/2014 in Services Orders received and net sales increased in services • Gross profit increased by EUR 16 million compared with Q1/2014 • SG&A1 expenses increased by EUR 3 million compared with Q1/2014 • EBITA2-margin improved but is below targeted level Focus on profitability improvement Strong balance sheet, negative cash flow provided by operating activities • Net debt EUR -134 million, and gearing -17% • Cash flow provided by operating activities EUR -20 million • Order backlog EUR 66 million higher than at year-end 2014 Order backlog at EUR 2.1 billion
Interim Review January–June 2015 July 30, 2015 www.valmet.com/investors
Appendix
© Valmet26 April 29, 2015 Largest shareholders on March 31, 2015 Based on the information given by Euroclear Finland Ltd. # Shareholder name Number of shares % of shares and votes 1 Solidium Oy1 16,695,287 11.14% 2 Cevian Capital Partners Ltd. 10,323,191 6.89% 3 Nordea Funds 4,610,779 3.08% 4 Skagen Global Verdipapirfond 3,202,627 2.14% 5 Ilmarinen Mutual Pension Insurance Company 3,092,126 2.06% 6 Varma Mutual Pension Insurance Company 2,908,465 1.94% 7 The State Pension Fund 1,520,000 1.01% 8 Keva 1,502,166 1.00% 9 Mandatum Life Insurance Company Limited 1,237,307 0.83% 10 Skagen Global II Verdipapirfond 947,963 0.63% 10 largest shareholders, total 46,039,911 30.72% Other shareholders 103,824,708 69.28% Total 149,864,619 100.00% Largest shareholders 1) A holding company that is wholly owned by the Finnish State • The holding of Capital Partners Ltd. decreased on February 13, 2015 to 10,323,191 shares (previously 20,813,714 shares), corresponding to an ownership of 6.89% (previously 13.89%) of Valmet’s shares.
© Valmet27 April 29, 2015 54.5% 20.2% 11.1% 14.2% Nominee registered and non-Finnish holders Finnish institutions, companies and foundations Solidium Oy Finnish private investors 1) A holding company that is wholly owned by the Finnish State Ownership structure on March 31, 2015 Sector Number of shareholders % of total shareholders Number of shares % of shares Nominee registered and non-Finnish holders 308 0.6% 81,573,996 54.4% Finnish institutions, companies and foundations 2,782 5.7% 30,453,836 20.2% Solidium Oy1 0 0.0% 16,695,287 11.1% Finnish private investors 46,044 93.7% 21,141,500 14.2% Total 49,134 100.0% 149,864,619 100.0% The ownership structure is based on the classification of sectors determined by Statistics Finland.
© Valmet28 April 29, 2015 48,000 50,000 52,000 54,000 56,000 58,000 60,000 45% 47% 49% 51% 53% 55% 57% 12/2013 01/2014 02/2014 03/2014 04/2014 05/2014 06/2014 07/2014 08/2014 09/2014 10/2014 11/2014 12/2014 01/2015 02/2015 03/2015 Non-Finnish holders (LHS) Total number of shareholders (RHS) Share of non-Finnish holders and number of shareholders
Paper, board, and tissue production trends April 29, 2015 © Valmet29 Source: RISI North America (million tonnes) Europe (million tonnes) China (million tonnes) Asia-Pacific (million tonnes) 10 20 30 40 4 6 8 10 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS) 10 15 20 25 30 35 40 5 7 9 11 13 15 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS) 5 15 25 35 45 55 2 4 6 8 10 12 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS) 5 10 15 20 25 30 35 40 3 4 5 6 7 8 9 10 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS)
Paper, board, and tissue operating rates April 29, 2015 © Valmet30 Source: RISI North America Europe China Asia-Pacific 75% 80% 85% 90% 95% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard 80% 85% 90% 95% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard 70% 80% 90% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard 75% 80% 85% 90% 95% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard
Paper and board consumption growth trends April 29, 2015 © Valmet31 Population growth in emerging markets is larger than in developed markets Level of consumption per capita in emerging markets clearly below that in developed markets This offers us long- term growth potential Paper and board consumption per capita vs. population Average global consumption: 53 kg per capita Source: RISI 0 500 1,000 1,500 2,000 2,500 0 50 100 150 200 250 EasternEurope WesternEurope NorthAmerica LatinAmerica Japan China RestofAsia Oceania Africa MiddleEast Consumption per capita, kg (LHS) Population, million (RHS)
0 5 10 15 20 25 0 500 1,000 1,500 2,000 2,500 EasternEurope WesternEurope NorthAmerica LatinAmerica Japan China RestofAsia Oceania Africa MiddleEast Population, million (LHS) Consumption per capita, kg (RHS) Tissue consumption growth trends April 29, 2015 © Valmet32 New products and consumption models based on tissue are helping increase consumption in developed markets Consumption in emerging markets is still low, but growing Offers us long-term growth potential in both developed and emerging markets Tissue consumption per capita vs. population Average global consumption: 4.5 kg per capita Source: RISI
0 200 400 600 800 1,000 1,200 1-Dec-07 1-Mar-08 1-Jun-08 1-Sep-08 1-Dec-08 1-Mar-09 1-Jun-09 1-Sep-09 1-Dec-09 1-Mar-10 1-Jun-10 1-Sep-10 1-Dec-10 1-Mar-11 1-Jun-11 1-Sep-11 1-Dec-11 1-Mar-12 1-Jun-12 1-Sep-12 1-Dec-12 1-Mar-13 1-Jun-13 1-Sep-13 1-Dec-13 1-Mar-14 1-Jun-14 1-Sep-14 1-Dec-14 1-Mar-15 Eucalyptus pulp (USD/t) Northern bleached softwood pulp (USD/t) Uncoated (USD/t) Copy paper (EUR/t) Testliner (EUR/t) Pulp and paper price trends April 29, 2015 © Valmet33 Source: Bloomberg
0 10 20 30 40 50 60 70 80 90 100 0 20 40 60 80 100 120 140 160 180 1-Jan-10 1-Jul-10 1-Jan-11 1-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 CIF ARA steam coal (USD/t) (LHS) Brent crude oil (USD/barrel) (LHS) Natural gas spot price NBP (GBP/therm) (RHS) 0 20 40 60 80 100 120 0 20 40 60 80 100 1-Jan-10 1-Jul-10 1-Jan-11 1-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 European Energy Exchange, Phelix (EUR/MWh) (LHS) Nordpool Power (EUR/MWh) (LHS) UK Baseload (GBP/MWh) (RHS) Crude oil, steam coal, natural gas and electricity April 29, 2015 © Valmet34 Source: Bloomberg Europe
0 1 2 3 4 5 6 7 0 20 40 60 80 100 120 140 1-Jan-10 1-Jul-10 1-Jan-11 1-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 FOB steam coal Richards Bay (USD/t) (LHS) WTI crude oil (USD/barrel) (LHS) Henry Hub gas (USD/MMBtu) (RHS) 70 75 80 85 90 0 50 100 150 200 1-Jan-10 1-Jul-10 1-Jan-11 1-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 Electricity spot price, PJM (USD/MWh) (LHS) Electricity spot price, NEPOOL (USD/MWh) (LHS) US utility capacity utilization rate (RHS) Crude oil, steam coal, natural gas and electricity April 29, 2015 © Valmet35 Source: Bloomberg United States
0 1 2 3 4 5 6 7 8 9 2-Nov-12 2-Dec-12 2-Jan-13 2-Feb-13 2-Mar-13 2-Apr-13 2-May-13 2-Jun-13 2-Jul-13 2-Aug-13 2-Sep-13 2-Oct-13 2-Nov-13 2-Dec-13 2-Jan-14 2-Feb-14 2-Mar-14 2-Apr-14 2-May-14 2-Jun-14 2-Jul-14 2-Aug-14 2-Sep-14 2-Oct-14 2-Nov-14 2-Dec-14 2-Jan-15 2-Feb-15 2-Mar-15 European Energy Exchange (EEX) spot price (EUR/t) European Carbon Emission Allowance April 29, 2015 © Valmet36 Source: Bloomberg
Important notice April 29, 2015 © Valmet37 IMPORTANT: The following applies to this document, the oral presentation of the information in this document by Valmet (the “Company”) or any person on behalf of the Company, and any question-and-answer session that follows the oral presentation (collectively, the “Information”). In accessing the Information, you agree to be bound by the following terms and conditions. The Information is not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident of, or located in, any locality, state, country or other jurisdiction where such distribution or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction. The Information is not for publication, release or distribution in the United States, the United Kingdom, Australia, Canada or Japan. The Information does not constitute or form part of, and should not be construed as an offer or the solicitation of an offer to subscribe for or purchase any securities, and nothing contained therein shall form the basis of or be relied on in connection with any contract or commitment whatsoever, nor does it constitute a recommendation regarding any securities. Prospective investors are required to make their own independent investigations and appraisals of the business and financial condition of the Company before taking any investment decision with respect to securities of the Company. No securities of the Company are being offered or sold, directly or indirectly, in or into the United States and no shares in the Company have been, or will be, registered under the Securities Act of 1933, as amended (the “Securities Act”), or under the securities laws of any state of the United States and, accordingly, may not be offered or sold, directly or indirectly, in or into the United States (as defined in Regulation S under the Securities Act), unless registered under the Securities Act or pursuant to an exemption from the registration requirements of the Securities Act and in compliance with any applicable state securities laws of the United States. The Information is directed solely at: (i) persons outside the United Kingdom, (ii) persons with professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended (the “Order”), (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order and (iv) persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities of the Company or any member of its group may otherwise lawfully be communicated or caused to be communicated (all such persons in (i)-(iv) above being “Relevant Persons”). Any investment activity to which the Information relates will only be available to and will only be engaged with Relevant Persons. Any person who is not a Relevant Person should not act or rely on the Information. By accessing the Information, you represent that you are a Relevant Person. The Information contains forward-looking statements. All statements other than statements of historical fact included in the Information are forward-looking statements. Forward- looking statements give the Company’s current expectations and projections relating to its financial condition, results of operations, plans, objectives, future performance and business. These statements may include, without limitation, any statements preceded by, followed by or including words such as “target,” “believe,” “expect,” “aim,” “intend,” “may,” “anticipate,” “estimate,” “plan,” “project,” “will,” “can have,” “likely,” “should,” “would,” “could” and other words and terms of similar meaning or the negative thereof. Such forward- looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company’s control that could cause the Company’s actual results, performance or achievements to be materially different from the expected results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company’s present and future business strategies and the environment in which it will operate in the future. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the Information or the opinions contained therein. The Information has not been independently verified and will not be updated. The Information, including but not limited to forward- looking statements, applies only as of the date of this document and is not intended to give any assurances as to future results. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to the Information, including any financial data or forward-looking statements, and will not publicly release any revisions it may make to the Information that may result from any change in the Company’s expectations, any change in events, conditions or circumstances on which these forward-looking statements are based, or other events or circumstances arising after the date of this document. Market data used in the Information not attributed to a specific source are estimates of the Company and have not been independently verified.
Valmet's Interim Review January-March 2015

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Valmet's Interim Review January-March 2015

  • 1.
    Orders received increased inServices – focus continues to be on profitability improvement Interim Review, January–March 2015 April 29, 2015 Pasi Laine, President and CEO Markku Honkasalo, CFO
  • 2.
    Agenda Q1/2015 in brief Businesslines’ development Financial development Summary of Interim Review Q1/2015 Appendix 1 2 3 5 6 Interim Review, January–March 2015 Guidance and short-term market outlook4 April 29, 2015 © Valmet2
  • 3.
  • 4.
    • Orders receiveddecreased in Pulp and Energy, and Paper business lines from the high levels in Q1/2014 • Net sales increased in Pulp and Energy and decreased in Paper compared with Q1/2014 Orders received decreased and net sales increased in capital business • Services orders received increased compared with Q1/2014 • Net sales increased compared with Q1/2014 in Services Orders received and net sales increased in services April 29, 2015 © Valmet4 Q1/2015 in brief • Gross profit increased by EUR 16 million compared with Q1/2014 • SG&A1 expenses increased by EUR 3 million compared with Q1/2014 • EBITA2-margin improved but is below targeted level Focus on profitability improvement Strong balance sheet, negative cash flow provided by operating activities • Net debt EUR -134 million, and gearing -17% • Cash flow provided by operating activities EUR -20 million • Order backlog EUR 66 million higher than at year-end 2014 Order backlog at EUR 2.1 billion 1) Selling, general and administrative expenses before non-recurring items 2) EBITA = Earnings before interest, taxes and amortization and non-recurring items
  • 5.
    Key figures Q1/2015 April29, 2015 © Valmet5 EUR million Q1/2015 Q1/2014 Change Orders received 580 1,101 -47% Order backlog1 2,064 1,972 5% Net sales 561 519 8% EBITA2 19 4 >100% % of net sales 3.5% 0.7% EBIT3 13 -8 % of net sales 2.4% -1.5% Earnings per share, EUR 0.05 -0.04 Return on capital employed (ROCE), before taxes4 6% -2% Cash flow provided by operating activities -20 43 Gearing1 -17% -5% Non-recurring items: EUR 0 million in Q1/2015 (EUR -6 million in Q1/2014) 1) At the end of period 2) Before non-recurring items 3) After non-recurring items 4) Annualized
  • 6.
    267 273 242273 293 622 560 96 66 138 212 190 128 142 149 1,101 1,023 466 480 580 0 500 1,000 1,500 2,000 2,500 3,000 3,500 0 200 400 600 800 1,000 1,200 1,400 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Services (LHS) Pulp and Energy (LHS) Paper (LHS) Last 4 quarters (RHS) 185 82 135 88 189 24 194 23 40 50 437 567 189 277 202 35 121 54 35 54 420 59 66 41 85 1,101 1,023 466 480 580 0 500 1,000 1,500 2,000 2,500 3,000 3,500 0 200 400 600 800 1,000 1,200 1,400 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 North America (LHS) South America (LHS) EMEA (LHS) China (LHS) Asia-Pacific (LHS) Last 4 quarters (RHS) Orders received declined from the high level in Q1/2014 • Orders received increased in Services • Orders received decreased in Pulp and Energy • Orders received decreased in Paper • Orders received increased in South America and China April 29, 2015 © Valmet6 Orders received (EUR million), by business line Orders received (EUR million), by area
  • 7.
    1,972 2,406 2,312 1,998 2,064 0 500 1,000 1,500 2,000 2,500 3,000 Q1/14Q2/14 Q3/14 Q4/14 Q1/15 Order backlog at EUR 2.1 billion • About 75% of the order backlog is currently expected to be realized as sales during 2015 • Approximately 25% of the order backlog relates to the Services business line April 29, 2015 © Valmet7 Order backlog (EUR million) ~25% ~75% Services business Capital business Structure of order backlog
  • 8.
    224 251 235278 242 519 588 590 777 561 0.7% 3.7% 5.5% 6.1% 3.5% Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Services Capital EBITA-% EBITA target 6–9% EBITA-margin increased compared with Q1/2014 April 29, 2015 © Valmet8 Net sales and EBITA before NRI (EUR million) • Net sales and profitability increased compared with Q1/2014 - Changes in foreign exchange rates1 increased net sales by EUR 20 million and EBITA by EUR 1 million • Exceptionally many POC2 milestones in Q4/2014, while less in Q1/2015 EBITA before NRI (MEUR) 194 22 32 48 1) Compared with the exchange rates for January–March, 2014 2) POC = Percentage of completion
  • 9.
    0% 5% 10% 15% 20% 25% 30% 35% 40% 0 20 40 60 80 100 120 140 160 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 EUR million (LHS)% of net sales (RHS) 0% 5% 10% 15% 20% 25% 30% 35% 40% 0 20 40 60 80 100 120 140 160 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 EUR million (LHS) % of net sales (RHS) Good development in gross profit April 29, 2015 © Valmet9 Gross profit (EUR million and % of net sales) • Gross profit increased • Selling, general and administrative expenses (SG&A) increased EUR 3 million, due to changes in foreign exchange rates1 • Further actions to improve gross profit through Must-Win implementation and renewal SG&A (EUR million and % of net sales) 1) Compared with the exchange rates for January–March, 2014
  • 10.
    Key Must-Win objectivesto improve profitability to the targeted level of 6–9% April 29, 2015 © Valmet10 Improve project and service margin  Harmonization of processes  Localization of competencies  Better selection of sales cases  Development in project management  Common quality development approach  Quality tools and processes  Highlight the importance of quality initiatives and accountability Reduce quality costs and lead times  Increase sourcing from cost competitive countries  Increase use of sub-contracting  Consolidation of shipment and warehouse network Savings in procurement Improve product cost competitiveness to increase gross profit  Focus on cost efficient design  Modularity and standardization
  • 11.
     The acquisitionwas announced on January 15, 2015 and completed on April 1, 2015  Enterprise value of acquisition EUR 340 million1  Automation is Valmet’s fourth business line  January–June Interim Review will include Automation April 29, 2015 © Valmet11 Automation is Valmet’s fourth business line 1) Refers to the debt-free enterprise value of the acquisition.
  • 12.
  • 13.
    224 251 235 278 242 0 200 400 600 800 1,000 1,200 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net sales (LHS) Netsales, last 4 quarters (RHS) Growth in orders received and net sales in Services April 29, 2015 © Valmet13 Net sales (EUR million)Orders received (EUR million) • Services orders received increased compared with Q1/2014 - Orders received increased in North America, South America, EMEA and Asia- Pacific, and decreased in China - Orders received remained stable compared with Q1/2014 in Fabrics and increased in all other business units - Changes in foreign exchange rates1 increased orders received by approximately EUR 16 million • Net sales increased compared with Q1/2014 2014: EUR 1,055 million 2014: EUR 989 million 267 273 242 273 293 0 200 400 600 800 1,000 1,200 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Orders received (LHS) Orders received, last 4 quarters (RHS) 1) Compared with the exchange rates for January–March, 2014
  • 14.
    622 560 96 66 138 0 200 400 600 800 1,000 1,200 1,400 1,600 0 100 200 300 400 500 600 700 800 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Orders received(LHS) Orders received, last 4 quarters (RHS) 181 229 234 312 222 0 200 400 600 800 1,000 1,200 1,400 1,600 0 50 100 150 200 250 300 350 400 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net sales (LHS) Net sales, last 4 quarters (RHS) Orders received decreased and net sales increased in Pulp and Energy April 29, 2015 © Valmet14 Net sales (EUR million)Orders received (EUR million) • Orders received decreased compared with Q1/2014 - Orders received increased in South America and North America, and decreased in other areas - Orders received decreased in both Pulp and Energy • Net sales increased compared with Q1/2014 2014: EUR 956 million 2014: EUR 1,344 million
  • 15.
    212 190 128 142 149 0 150 300 450 600 750 900 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Ordersreceived (LHS) Orders received, last 4 quarters (RHS) 114 108 120 186 97 0 150 300 450 600 750 900 0 50 100 150 200 250 300 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net sales (LHS) Net sales, last 4 quarters (RHS) Orders received and net sales decreased in Paper April 29, 2015 © Valmet15 Net sales (EUR million)Orders received (EUR million) • Orders received decreased compared with Q1/2014 - Orders received increased in China and South America and decreased in other areas - Orders received increased in Board and Paper, and decreased in Tissue • Net sales decreased compared with Q1/2014 • Timing of POC1 milestones had a negative impact on net sales in Q1/2015 2014: EUR 528 million 2014: EUR 671 million 1) POC = Percentage of completion
  • 16.
  • 17.
    43 46 117 30 -20 -40 -20 0 20 40 60 80 100 120 140 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Cash flowprovided by operating activities negative due to net working capital development April 29, 2015 © Valmet17 • Change in net working capital was EUR -49 million1 • CAPEX less than depreciation Cash flow provided by operating activities (EUR million) 1) Change in net working capital in the condensed consolidated statement of cash flows
  • 18.
    -39 -54 -158 -166 -134 -5% -7% -20%-21% -17% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% -250 -200 -150 -100 -50 0 50 100 150 200 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net debt (EUR million) Gearing (%) Strong balance sheet and negative gearing April 29, 2015 © Valmet18 • Negative gearing (-17%) and net debt EUR -134 million • Equity to assets ratio was negatively affected by drawn bank loans to finance the acquisition of Process Automation Systems, and by dividend payout decision of Annual General Meeting Net debt (EUR million) and gearing (%) Equity to assets ratio (%) 40% 40% 41% 42% 34% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Q1/14 Q2/14 Q3/14 Q4/14 Q1/15
  • 19.
    0 50 100 150 200 250 300 350 400 2015 2016 20172018 2019 2020 2021 2022 2023 2024 2025 Structure of loans and borrowings April 29, 2015 © Valmet19 Amount of outstanding interest-bearing debt (EUR millions) • Average maturity of long-term loans is 4.1 years Main financing sources Back-up facilities Interest-bearing debt EUR 445 million as at March 31, 2015 EUR 147 million EUR 100 million European Investment Bank Skandinaviska Enskilda Banken Nordic Investment Bank Amount Lender EUR 70 million Swedish Export Kredit EUR 95 million EUR 0 million EUR 200 million domestic commercial paper program EUR 200 million syndicated revolving credit facility Amount Outstanding EUR 30 million
  • 20.
  • 21.
    Guidance and short-termmarket outlook 21 April 29, 2015 © Valmet Good Pulp and Energy Paper Satisfactory Pulp Energy Board and Paper Tissue Guidance for 2015 Services Short-term market outlook Guidance for 2015 (as given on February 6, 2015) Satisfactory Satisfactory Good Satisfactory Satisfactory Satisfactory Satisfactory Good Satisfactory Q2/2014 Q3/2014 Satisfactory Satisfactory Satisfactory Good Satisfactory Q4/2014 Satisfactory Weak Good Satisfactory Q1/2015 Valmet estimates that, including the acquisition of Process Automation Systems, net sales in 2015 will increase in comparison with 2014 (EUR 2,473 million) and EBITA before non-recurring items in 2015 will increase in comparison with 2014 (EUR 106 million). - - - SatisfactoryAutomation
  • 22.
  • 23.
    April 29, 2015© Valmet23 Summary of Interim Review Q1/2015 1) Selling, general and administrative expenses before non-recurring items 2) EBITA = Earnings before interest, taxes and amortization and non-recurring items • Orders received decreased in Pulp and Energy, and Paper business lines from the high levels in Q1/2014 • Net sales increased in Pulp and Energy and decreased in Paper compared with Q1/2014 Orders received decreased and net sales increased in capital business • Services orders received increased compared with Q1/2014 • Net sales increased compared with Q1/2014 in Services Orders received and net sales increased in services • Gross profit increased by EUR 16 million compared with Q1/2014 • SG&A1 expenses increased by EUR 3 million compared with Q1/2014 • EBITA2-margin improved but is below targeted level Focus on profitability improvement Strong balance sheet, negative cash flow provided by operating activities • Net debt EUR -134 million, and gearing -17% • Cash flow provided by operating activities EUR -20 million • Order backlog EUR 66 million higher than at year-end 2014 Order backlog at EUR 2.1 billion
  • 24.
    Interim Review January–June 2015 July30, 2015 www.valmet.com/investors
  • 25.
  • 26.
    © Valmet26 April29, 2015 Largest shareholders on March 31, 2015 Based on the information given by Euroclear Finland Ltd. # Shareholder name Number of shares % of shares and votes 1 Solidium Oy1 16,695,287 11.14% 2 Cevian Capital Partners Ltd. 10,323,191 6.89% 3 Nordea Funds 4,610,779 3.08% 4 Skagen Global Verdipapirfond 3,202,627 2.14% 5 Ilmarinen Mutual Pension Insurance Company 3,092,126 2.06% 6 Varma Mutual Pension Insurance Company 2,908,465 1.94% 7 The State Pension Fund 1,520,000 1.01% 8 Keva 1,502,166 1.00% 9 Mandatum Life Insurance Company Limited 1,237,307 0.83% 10 Skagen Global II Verdipapirfond 947,963 0.63% 10 largest shareholders, total 46,039,911 30.72% Other shareholders 103,824,708 69.28% Total 149,864,619 100.00% Largest shareholders 1) A holding company that is wholly owned by the Finnish State • The holding of Capital Partners Ltd. decreased on February 13, 2015 to 10,323,191 shares (previously 20,813,714 shares), corresponding to an ownership of 6.89% (previously 13.89%) of Valmet’s shares.
  • 27.
    © Valmet27 April29, 2015 54.5% 20.2% 11.1% 14.2% Nominee registered and non-Finnish holders Finnish institutions, companies and foundations Solidium Oy Finnish private investors 1) A holding company that is wholly owned by the Finnish State Ownership structure on March 31, 2015 Sector Number of shareholders % of total shareholders Number of shares % of shares Nominee registered and non-Finnish holders 308 0.6% 81,573,996 54.4% Finnish institutions, companies and foundations 2,782 5.7% 30,453,836 20.2% Solidium Oy1 0 0.0% 16,695,287 11.1% Finnish private investors 46,044 93.7% 21,141,500 14.2% Total 49,134 100.0% 149,864,619 100.0% The ownership structure is based on the classification of sectors determined by Statistics Finland.
  • 28.
    © Valmet28 April29, 2015 48,000 50,000 52,000 54,000 56,000 58,000 60,000 45% 47% 49% 51% 53% 55% 57% 12/2013 01/2014 02/2014 03/2014 04/2014 05/2014 06/2014 07/2014 08/2014 09/2014 10/2014 11/2014 12/2014 01/2015 02/2015 03/2015 Non-Finnish holders (LHS) Total number of shareholders (RHS) Share of non-Finnish holders and number of shareholders
  • 29.
    Paper, board, andtissue production trends April 29, 2015 © Valmet29 Source: RISI North America (million tonnes) Europe (million tonnes) China (million tonnes) Asia-Pacific (million tonnes) 10 20 30 40 4 6 8 10 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS) 10 15 20 25 30 35 40 5 7 9 11 13 15 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS) 5 15 25 35 45 55 2 4 6 8 10 12 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS) 5 10 15 20 25 30 35 40 3 4 5 6 7 8 9 10 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue (LHS) Newsprint (LHS) Printing & Writing (RHS) Containerboard (RHS) Cartonboard (RHS)
  • 30.
    Paper, board, andtissue operating rates April 29, 2015 © Valmet30 Source: RISI North America Europe China Asia-Pacific 75% 80% 85% 90% 95% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard 80% 85% 90% 95% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard 70% 80% 90% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard 75% 80% 85% 90% 95% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Tissue Newsprint Printing & Writing Containerboard Cartonboard
  • 31.
    Paper and boardconsumption growth trends April 29, 2015 © Valmet31 Population growth in emerging markets is larger than in developed markets Level of consumption per capita in emerging markets clearly below that in developed markets This offers us long- term growth potential Paper and board consumption per capita vs. population Average global consumption: 53 kg per capita Source: RISI 0 500 1,000 1,500 2,000 2,500 0 50 100 150 200 250 EasternEurope WesternEurope NorthAmerica LatinAmerica Japan China RestofAsia Oceania Africa MiddleEast Consumption per capita, kg (LHS) Population, million (RHS)
  • 32.
    0 5 10 15 20 25 0 500 1,000 1,500 2,000 2,500 EasternEurope WesternEurope NorthAmerica LatinAmerica Japan China RestofAsia Oceania Africa MiddleEast Population, million (LHS)Consumption per capita, kg (RHS) Tissue consumption growth trends April 29, 2015 © Valmet32 New products and consumption models based on tissue are helping increase consumption in developed markets Consumption in emerging markets is still low, but growing Offers us long-term growth potential in both developed and emerging markets Tissue consumption per capita vs. population Average global consumption: 4.5 kg per capita Source: RISI
  • 33.
  • 34.
    0 10 20 30 40 50 60 70 80 90 100 0 20 40 60 80 100 120 140 160 180 1-Jan-10 1-Jul-10 1-Jan-111-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 CIF ARA steam coal (USD/t) (LHS) Brent crude oil (USD/barrel) (LHS) Natural gas spot price NBP (GBP/therm) (RHS) 0 20 40 60 80 100 120 0 20 40 60 80 100 1-Jan-10 1-Jul-10 1-Jan-11 1-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 European Energy Exchange, Phelix (EUR/MWh) (LHS) Nordpool Power (EUR/MWh) (LHS) UK Baseload (GBP/MWh) (RHS) Crude oil, steam coal, natural gas and electricity April 29, 2015 © Valmet34 Source: Bloomberg Europe
  • 35.
    0 1 2 3 4 5 6 7 0 20 40 60 80 100 120 140 1-Jan-10 1-Jul-10 1-Jan-111-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 FOB steam coal Richards Bay (USD/t) (LHS) WTI crude oil (USD/barrel) (LHS) Henry Hub gas (USD/MMBtu) (RHS) 70 75 80 85 90 0 50 100 150 200 1-Jan-10 1-Jul-10 1-Jan-11 1-Jul-11 1-Jan-12 1-Jul-12 1-Jan-13 1-Jul-13 1-Jan-14 1-Jul-14 1-Jan-15 Electricity spot price, PJM (USD/MWh) (LHS) Electricity spot price, NEPOOL (USD/MWh) (LHS) US utility capacity utilization rate (RHS) Crude oil, steam coal, natural gas and electricity April 29, 2015 © Valmet35 Source: Bloomberg United States
  • 36.
  • 37.
    Important notice April 29,2015 © Valmet37 IMPORTANT: The following applies to this document, the oral presentation of the information in this document by Valmet (the “Company”) or any person on behalf of the Company, and any question-and-answer session that follows the oral presentation (collectively, the “Information”). In accessing the Information, you agree to be bound by the following terms and conditions. The Information is not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident of, or located in, any locality, state, country or other jurisdiction where such distribution or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction. The Information is not for publication, release or distribution in the United States, the United Kingdom, Australia, Canada or Japan. The Information does not constitute or form part of, and should not be construed as an offer or the solicitation of an offer to subscribe for or purchase any securities, and nothing contained therein shall form the basis of or be relied on in connection with any contract or commitment whatsoever, nor does it constitute a recommendation regarding any securities. Prospective investors are required to make their own independent investigations and appraisals of the business and financial condition of the Company before taking any investment decision with respect to securities of the Company. No securities of the Company are being offered or sold, directly or indirectly, in or into the United States and no shares in the Company have been, or will be, registered under the Securities Act of 1933, as amended (the “Securities Act”), or under the securities laws of any state of the United States and, accordingly, may not be offered or sold, directly or indirectly, in or into the United States (as defined in Regulation S under the Securities Act), unless registered under the Securities Act or pursuant to an exemption from the registration requirements of the Securities Act and in compliance with any applicable state securities laws of the United States. The Information is directed solely at: (i) persons outside the United Kingdom, (ii) persons with professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended (the “Order”), (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order and (iv) persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities of the Company or any member of its group may otherwise lawfully be communicated or caused to be communicated (all such persons in (i)-(iv) above being “Relevant Persons”). Any investment activity to which the Information relates will only be available to and will only be engaged with Relevant Persons. Any person who is not a Relevant Person should not act or rely on the Information. By accessing the Information, you represent that you are a Relevant Person. The Information contains forward-looking statements. All statements other than statements of historical fact included in the Information are forward-looking statements. Forward- looking statements give the Company’s current expectations and projections relating to its financial condition, results of operations, plans, objectives, future performance and business. These statements may include, without limitation, any statements preceded by, followed by or including words such as “target,” “believe,” “expect,” “aim,” “intend,” “may,” “anticipate,” “estimate,” “plan,” “project,” “will,” “can have,” “likely,” “should,” “would,” “could” and other words and terms of similar meaning or the negative thereof. Such forward- looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company’s control that could cause the Company’s actual results, performance or achievements to be materially different from the expected results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company’s present and future business strategies and the environment in which it will operate in the future. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the Information or the opinions contained therein. The Information has not been independently verified and will not be updated. The Information, including but not limited to forward- looking statements, applies only as of the date of this document and is not intended to give any assurances as to future results. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to the Information, including any financial data or forward-looking statements, and will not publicly release any revisions it may make to the Information that may result from any change in the Company’s expectations, any change in events, conditions or circumstances on which these forward-looking statements are based, or other events or circumstances arising after the date of this document. Market data used in the Information not attributed to a specific source are estimates of the Company and have not been independently verified.