Profitability guides our future growth

Mika JoukioCEO

This presentation includes forward-looking statements. The words “believe,” “expect,” “anticipate,” “intend,” “may,” “plan,”

“estimate,” “will,” “should,” “could,” “aim,” “target,” “might,” or, in each case, their negative, or any similar expressions

identify certain of these forward-looking statements. Others can be identified from the context in which the statements are

made. By their nature, forward-looking statements are subject to assumptions, risks and uncertainties. Although we

believe that the expectations reflected in these forward-looking statements are reasonable, actual results may differ, even

materially, from those expressed or implied by these forward-looking statements. We urge presentation participants not to

place undue reliance on such statements.

The information and views contained in this presentation are provided as at the date of this presentation and are subject to

change without notice. Metsä Board does not undertake any obligation to publicly update or revise forward-looking

statements, whether as a result of new information, future events or otherwise, except to the extent legally required.

Viewers should understand that this presentation does not constitute, and should not be construed as, an offer to buy or

subscribe for Metsä Board’s securities anywhere in the world or an inducement to enter into any investment activity

relating to the same. No part of this presentation should form the basis of, or be relied on in connection with, any contract

or commitment or decision to invest in Metsä Board securities whatsoever. Potential investors are instructed to acquaint

themselves with Metsä Board’s annual accounts, interim reports and stock exchange releases as well as other information

published by Metsä Board to form a comprehensive picture of the company and its securities.

Metsä Board publishes inside information according to Market Abuse Regulation (MAR) and rules of the Nasdaq Helsinki.

2

Disclaimer

• Our focus is on high-quality paperboards

made from fresh fibres, where we have a

leading position

• We have a clear strategy for sustainable

and profitable growth

• Fresh fibre paperboard market offers

attractive growth opportunities

3

Profitability guides our

future growth

• Our strategic cornerstones:

– We focus on premium fresh fibre

paperboards

– We target profitable growth together with

brand owner, converter and merchant

customers globally

– Profitability is based on superior cost

efficiency and healthy sales prices

• Global trends are driving demand

• We are self-sufficient in pulp

4

We are a pure-play paperboard company…

35% 32%

Folding boxboard

in EuropeTotal capacity 3.8m tonnes

White kraftliner

in EuropeTotal capacity 2.1m tonnes

Metsä

Board

#1

#2#3

#4

#5

Others Metsä

Board

#1

#2#3

#4

#5

Others

We have a leading position in Europe

Wood products Paperboard

METSÄ

TISSUE

METSÄ

FOREST

Wood supply and

forest services

METSÄ

FIBRE

Pulp and sawn

timber

METSÄ

WOOD

METSÄ

BOARD

Tissue and

cooking papers

Group’s parent company, owned by 104,000 Finnish forest owners

METSÄLIITTO COOPERATIVE

METSÄ GROUP

METSÄ BOARD

OWNS 24.9%

• High availability of northern wood

• Consistent quality of fibres that are tailor-made for the end products

…with good control of wood raw materials,

from forests to pulp and board production

White kraftlinersRetail-ready tray and point-of-sale solutions

Food service boardsSolutions for food service

Folding boxboardsPackaging solutions for consumer goods

We continue to deliver solid performance through our

light, pure and safe paperboards…

Our total paperboard capacity is

2m tonnes/yearof which

1/3 are white kraftliners and

2/3 folding boxboard 0

500

1000

1500

2000

2500

14 15 16 17 LTM

SalesEUR million

0

3

6

9

12

15

0

50

100

150

200

250

14 15 16 17 LTM

Operating resultEUR million and % of sales

.. with increasing shareholder value and

growing dividends

Enterprise value, EUR million

0

500

1000

1500

2000

2500

3000

3500

2012 2013 2014 2015 2016 2017 9/18

Market capitalization, EUR million

Net debt, EUR million

Dividend, EUR and payout ratio, %

0%

20%

40%

60%

80%

100%

0,00

0,05

0,10

0,15

0,20

0,25

2012 2013 2014 2015 2016 2017

Dividend, EUR Dividend/EPS, %

7

CAGR in dividend

+30%in 2012–2017

Our financial targets are unchanged and aim for

profitable growth and a strong balance sheet

Comparable ROCE, %

9,1

11,3

8,1

11,2

14,1

2014 2015 2016 2017 LTM

1,8

1,2

2,0

1,21,0

2014 2015 2016 2017 9/2018

Net debt / comparable EBITDA

10%

13%12%

15%

6%

2014 2015 2016 2017 LTM

Annual growth in total paperboard deliveries, %

Target is to

exceed

relevant

market

growth,

3%/a

Dividend policyWe aim to distribute at least 50% of our

result for the financial period in annual dividends

Target >12% Target <2.5

88

Global paperboard market is growing by 3% annually –

and we have a strong position in it

9

The total packaging market is USD 850 billion Average annual growth rate of paperboard packaging

USD

300 bn

US

D b

nSource: Smithers Pira

0

50

100

150

200

250

300

350

2012 2013 2014 2015 2016 2017 2022F

+3% per year 2017–2022

Board and Paper

Other fibre-based

Plastic

Metal

Glass

36%

10%

34%

13%

7%

Rapidly growing concern about non-renewable

packaging materials is increasing demand for

fresh fibre paperboards

Lighter packaging reduces CO2 emissions across the

value chain – Our fossil CO2 emissions per product tonne

have reduced by almost 50% since 2009

Less energy, water and

raw material consumed

Less

transport

weight

Less waste

generated

RAW MATERIALS AND SUPPLY CHAIN

We are committed to high performance on sustainability

Share of certified wood:

PERFORMANCE 2017

80%TARGET

>80%

Ensure sustainability of the main logistics

flows:

TARGET

100%

Fossil CO2 emissions per product tonne

2009–2020:

PERFORMANCE 2017

-47%TARGET

-30%

Energy efficiency improvement

2009–2020:

PERFORMANCE 2017

10.2%TARGET

12%

Process water use per product tonne

2010–2020:

PERFORMANCE 2017

-17%TARGET

-17%

Coverage of Code of Conduct training:

PERFORMANCE 2017

79%TARGET

100%

Lost-time accidents frequency annually

(LTA1: 6.4):

PERFORMANCE 2017

-28.4%TARGET

-10%

Sickness absenteeism:

PERFORMANCE 2017

3.9%TARGET

<3%

RESOURCE EFFICIENCY AND ENVIRONMENTAL IMPACTS

STAKEHOLDERS AND SOCIAL IMPACTS

PERFORMANCE 2017

100%

External recognition for and commitments to sustainability:

A rating of AAA in the

MSCI ESG Ratings

assessment in June

2018.

Leader in

Sustainalytics’

assessment in May

2018.

Profitability guides our future growth

14

We have been growing at a CAGR of 12% –

well above average market growth …

0

500

1 000

1 500

2 000

2013 2014 2015 2016 2017 LTM

White kraftliner Folding boxboard

Metsä Board’s annual paperboard deliveries

Annual global

demand growth for

folding boxboard

and white kraftliner

is estimated to be

3%

Source: Metsä Board´s own research

1,0

00 t

onnes

2011–12

Debottlenecking in Simpele, Äänekoski

and Kyro mills: total 150,000 t/a of FBB

2015–16

New folding boxboard production line in

Husum: 400,000 t/a of FBB

Linerboard production line conversion

in Husum: 270,000 t/a of WKL

2017

New extrusion coating line in Husum:

100,000 t/a PE coating capacity

15

…driven by capacity increases

0

30

60

90

120

150

180

2010 2011 2012 2013 2014 2015 2016 2017 2018E

Maintenance capex Growth capex Depreciation

Capital expenditure and depreciation

EUR million

• Our top priorities:

– To keep ROCE above 12% and

– To generate the highest possible

shareholder value

• The best returns can be achieved from

medium-sized investments to increase

the capacity of our current production

lines

• In medium term, this means moderate

growth and a strong focus on profitability

• Our long-term financial targets remain

unchanged

16

Next steps:

Profitability first

• We are a pure-play paperboard company

focused on high-quality paperboards

• We have high availability of northern wood

and self-sufficiency in pulp

• Sustainability is driving demand and

making our business even stronger

• In the medium term, we are aiming for

moderate growth, and we have strong

focus on profitability

17

Profitability guides our

future growth