Valmet's Interim Review January-March 2016

Orders received, net sales and profitability increased

Interim Review,

January–March 2016

April 27, 2016

Pasi Laine, President and CEO

Kari Saarinen, CFO

AgendaInterim Review, January–March 2016

Q1/2016 in brief

Business lines’ development

Financial development

Summary of Interim Review Q1/2016

Appendix

1

2

3

5

6

Guidance and short-term market outlook4

Q1/2016 in brief

Order backlog at EUR 2.2 billion

Orders received and net sales increased in capital business2

April 27, 2016 © Valmet | Interim Review, January–March 20164

Q1/2016 in brief

1) Stable business = Services and Automation business lines

2) Capital business = Pulp and Energy, and Paper business lines

Net debt EUR 192 million

Profitability improved compared to Q1/2015, but was below

the targeted level

Orders received and net sales increased in stable business1

Net sales split in Q1/2016


Net sales by area Net sales by business lineOrders received

EUR 803 million

Net sales

EUR 652 million

Comparable EBITA1

EUR 31 million

Comparable EBITA1

margin

4.8%

Employees

12,297

39%

9%

28%

24%

Services

Automation

Pulp and Energy

Paper

24%

7%

45%

14%

11%

North America

South America

EMEA

China

Asia-Pacific

1) Due to new regulation by the European Securities and Market Authority, Valmet has decided to replace the performance measure ‘EBITA before non-recurring items’ with

‘Comparable EBITA’. The content of items affecting comparability, i.e. items previously disclosed as non-recurring, remain unchanged and therefore ‘Comparable EBITA’

equals previously disclosed ‘EBITA before non-recurring items’ (EUR 182 million in 2015). Items affecting comparability consist of income and expenses arising from

activities that amend the capacity of Valmet’s operations or are incurred outside its normal course of business.

1,1011,023

466 480580

781725

793 803

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

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Orders received (LHS) Last 4 quarters (RHS)

Orders received increased to EUR 803 million in Q1/2016


• Orders received increased in the Pulp and Energy, Paper, and Services

business lines

• Automation contributed to orders received with EUR 66 million

• North America and EMEA accounted for 69% of orders received in Q1/2016

Orders received (EUR million) Orders received in Q1/2016, by area

North America

13%

South America

14%

EMEA55%

China11%

Asia-Pacific7%

Stable business orders received totaled EUR 1,468 million during the last 4 quarters


Orders received (EUR million) in stable business

267 273 242 273 293 307252 267

313

95

78 75

81

267 273242

273293

402

330 342

394

0

150

300

450

600

750

900

1,050

1,200

1,350

1,500

0

50

100

150

200

250

300

350

400

450

500

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16

Services (LHS) Automation, total (including internal) (LHS) Last 4 quarters (RHS)

• Stable business orders received totaled to EUR 394 million in Q1/2016

• Stable business rolling 12 months orders received have increased from

about EUR 1.1 billion to almost EUR 1.5 billion

1,972

2,4062,312

1,998 2,0642,208

2,117 2,0742,207

0

500

1,000

1,500

2,000

2,500

3,000

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6


• Order backlog EUR 133 million higher than at the end of Q4/2015

• About 70% of the order backlog is currently expected to be realized as net sales

during 2016

• Approximately 25% of the order backlog relates to stable business


Order backlog (EUR million)

~25%

~75%

Stable business Capital business

Structure of order backlog

Business lines’ development

Orders received and net sales increased in Services in Q1/2016


Net sales (EUR million)Orders received (EUR million)

• Orders received increased compared with Q1/2015- Orders received increased in China and South America, and remained stable in

EMEA, North America and Asia-Pacific

- Orders received increased in Mill Improvements, Performance Parts and Fabrics,

remained stable in Rolls, and decreased in Energy and Environmental

- Changes in foreign exchange rates1 decreased orders received by approximately

EUR 3 million

• Net sales increased compared with Q1/2015

1) Compared with the exchange rates for January–March 2015

2015:

EUR 1,119 million

2015:

EUR 1,128 million

267 273242

273293 307

252 267

313

0

200

400

600

800

1,000

1,200

1,400

0

50

100

150

200

250

300

350

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Orders received (LHS)

Orders received, last 4 quarters (RHS)

224251

235

278242

304268

314

257

0

200

400

600

800

1,000

1,200

1,400

0

50

100

150

200

250

300

350

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Net sales (LHS)

Net sales, last 4 quarters (RHS)

2014:

EUR 1,055 million

2014:

EUR 989 million

Orders received1

in Automation totaled to EUR 81 million in Q1/2016


• Orders received EUR 66 million in Q1/2016

- EMEA accounted for ~55% and North America for ~25% of orders received

- Pulp and Paper accounted for ~75% and Energy and Process for ~25% of

orders received

- Internal orders received amounted to EUR 15 million

• Net sales EUR 58 million in Q1/2016

- Internal net sales amounted to EUR 9 million

Net sales2 (EUR million)Orders received2 (EUR million)

1) Includes internal and external orders received.

2) Q1/2015 orders received and the underlying figures for ‘Orders received, last 4 quarters’ and ‘Net sales, last 4 quarters’ are calculated based on Metso’s reported

figures and pro forma figures excluding Process Automation Systems and are therefore indicative only.

8570 67 66

10

8 8 1562

95

78 7581

0

75

150

225

300

375

450

0

20

40

60

80

100

120

Q1/15 Q2/15 Q3/15 Q4/15 Q1/16

Orders received, internal (from other business lines)

Orders received, external

Orders received, total (including internal)


68 66

95

58

11 6

6

955

7972

101

66

0

75

150

225

300

375

450

0

20

40

60

80

100

120

Q1/15 Q2/15 Q3/15 Q4/15 Q1/16

Net sales, internal (from other business lines)

Net sales, external

Net sales, total (including internal)


Orders received increased and net sales decreased in Pulp and Energy in Q1/2016



• Orders received increased compared with Q1/2015

- Orders received decreased in North America and increased in all other areas

- Orders received increased in both Pulp and Energy

• Net sales decreased compared with Q1/2015

2015:

EUR 864 million

2015:

EUR 913 million

622560

96 66138

259206

261 238

0

200

400

600

800

1,000

1,200

1,400

0

100

200

300

400

500

600

700

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Orders received (LHS)


181

229 234

312

222 231215

245

181

0

200

400

600

800

1,000

1,200

1,400

0

50

100

150

200

250

300

350

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Net sales (LHS)


2014:

EUR 1,344 million

2014:

EUR 956 million

Orders received and net sales increased in Paper in Q1/2016



• Orders received increased compared with Q1/2015

- Orders received increased in EMEA and China and decreased in other

areas

- Orders received increased in both Board and Paper, and Tissue

• Net sales increased compared with Q1/2015

2015:

EUR 673 million

2015:

EUR 659 million

2014:

EUR 671 million

2014:

EUR 528 million

212190

128142 149

129

197 199186

0

150

300

450

600

750

0

50

100

150

200

250

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6Orders received (LHS)


114 108120

186

97

177 185200

157

0

150

300

450

600

750

0

50

100

150

200

250

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Net sales (LHS)


Progress in ‘Leader in technology and innovation’


IQ Portfolio

– Product: Quality measurements, controls, profilers and machine

vision for paper machines and pulp dryers

– Customer benefit: Improved quality

– Sustainability: Raw material savings

OptiFlo Aqua Layering

– Product: OptiFlo aqua layering for liner and fluting

– Customer benefit: Two plies with single headbox, improved strength

properties, and wet end chemical savings (30% less chemicals)

– Sustainability: Energy, raw material and chemical savings

Advantage™ ReTurne

– Product: Turbine for regaining energy from paper machine headbox

– Customer benefit: Electric energy recovery

(50% of jet energy ~4,800 MWh/year)

– Sustainability: Electric energy savings

PolySulfide System

– Product: Polysulfide generation plant and cooking system

– Customer benefit: Lower production cost and stronger softwood

pulp adapted for packaging grade paper and board

– Sustainability: Raw material savings

A successful year with Automation


Integration

– Integration process successfully finalized

Personnel

– Automation employee engagement high

New products

– Several new products launched, such as Valmet IQ quality

management solution

Cross-selling

– 31 automation packages sold together with Valmet’s pulp, energy

and paper projects

Industrial Internet

– Strengthened Valmet’s position in Industrial Internet

Increased Valmet’s stable business

– Contributed with EUR 329 million of orders received and EUR 318

million of net sales during the 12 months ended March 31, 2016

Valmet IQ quality management solution

Financial development

Key figures Q1/2016


EUR million Q1/2016 Q1/2015 Change 2015

Orders received 803 580 38% 2,878

Order backlog1 2,207 2,064 7% 2,074

Net sales 652 561 16% 2,928

Comparable EBITA2 31 19 61% 182

% of net sales 4.8% 3.5% 6.2%

EBITA 30 19 56% 157

Operating profit (EBIT) 19 13 43% 120

% of net sales 2.9% 2.4% 4.1%

Earnings per share, EUR 0.08 0.05 43% 0.51

Return on capital employed (ROCE), before taxes3 7% 6% 12%

Cash flow provided by operating activities 3 -20 78

Gearing1 24% -17% 21%

Items affecting comparability: EUR -2 million in Q1/2016 (EUR 0 million in Q1/2015)

1) At the end of period

2) Due to new regulation by the European Securities and Market Authority, Valmet has decided to replace the performance measure ‘EBITA before non-

recurring items’ with ‘Comparable EBITA’. The content of items affecting comparability, i.e. items previously disclosed as non-recurring, remain

unchanged and therefore ‘Comparable EBITA’ equals previously disclosed ‘EBITA before non-recurring items’. Items affecting comparability consist of

income and expenses arising from activities that amend the capacity of Valmet’s operations or are incurred outside its normal course of business.

3) Annualized

Stable business net sales increased EUR 73 million compared to Q1/2015


Net sales bridge, Q1/2015 vs. Q1/2016 (EUR million)

561

1558 -41 60

652

Net sales inQ1/2015

Servicesbusiness line

Automationbusiness line

Pulp and Energybusiness line

Paperbusiness line

Net sales inQ1/2016

Change in net sales

• Net sales increased in Services and Paper business lines compared to Q1/2015

• Net sales decreased in Pulp and Energy business line

• Automation became part of Valmet as of April 1, 2015

Good development in gross profit compared to Q1/2015


Gross profit (EUR million and % of net sales)

• Gross profit increased compared to Q1/2015

• Selling, general & administrative (SG&A) expenses increased compared to

Q1/2015 due to Automation acquisition

• Further actions to improve gross profit through Must-Win implementation

SG&A (EUR million and % of net sales)

23%

0%

5%

10%

15%

20%

25%

0

40

80

120

160

200

Q1/2

014

Q2/2

014

Q3/2

014

Q4/2

014

Q1/2

015

Q2/2

015

Q3/2

015

Q4/2

015

Q1/2

016

EUR million (LHS) % of net sales (RHS)

20%

0%

5%

10%

15%

20%

25%

0

40

80

120

160

200

Q1/2

014

Q2/2

014

Q3/2

014

Q4/2

014

Q1/2

015

Q2/2

015

Q3/2

015

Q4/2

015

Q1/2

016

EUR million (LHS) % of net sales (RHS)

Target 6–9%

Comparable EBITA margin development


Net sales and Comparable EBITA (EUR million)

• Net sales and profitability increased compared with Q1/2015

- Profitability improved due to the higher level of net sales in the Paper and Services business lines,

improved gross profit, and the acquisition of Automation

• The first quarter was the weakest quarter in 2014 and 2015

Comparable EBITA

(EUR million)

224251 235

278242

371334

409

314295337 354

498319

408400

445

338

519

588 590

777

561

779734

854

652

0.7%

3.7%5.5%

6.1%

3.5%

6.9%6.4%

7.3%

4.8%

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16

Capital business

Stable business

Comparable EBITA %

19 54 47 63 314 22 32 48

43 46

117

30

-20

17 16

64

3

-40

-20

0

20

40

60

80

100

120

140

Q1/2

01

4

Q2/2

01

4

Q3/2

01

4

Q4/2

01

4

Q1/2

01

5

Q2/2

01

5

Q3/2

01

5

Q4/2

01

5

Q1/2

01

6

Cash flow provided by operating activities


• Change in net working capital1 EUR -41 million in Q1/2016

• CAPEX excluding business combinations EUR -11 million in Q1/2016

• Cash flow provided by operating activities EUR 3 million in Q1/2016

Cash flow provided by operating activities (EUR million)

1) Change in net working capital, net of effect from business combinations and disposals in the consolidated statement of cash flows

-257 -249 -345 -353 -355 -265 -244 -238 -247

1,101 1,023

466 480 580781 725 793 803

-20%

-10%

0%

10%

20%

30%

-1,000

-500

0

500

1,000

1,500

Q1/2

01

4

Q2/2

01

4

Q3/2

01

4

Q4/2

01

4

Q1/2

01

5

Q2/2

01

5

Q3/2

01

5

Q4/2

01

5

Q1/2

01

6

Orders received (LHS)Net working capital (LHS)Average net working capital/rolling 12 months orders received (RHS)Net working capital/rolling 12 months orders received (RHS)

Net working capital -8% of rolling 12 months orders received


• Net working capital EUR -247 million, which equals -8% of rolling 12 months orders received

• Payment schedules of large capital projects have significant impact on net working capital

development

Net working capital and orders received (EUR million)

Net debt increased compared to Q4/2015


• Gearing (24%) and net debt (EUR 192 million) increased compared to Q4/2015

• Equity to assets ratio decreased from Q4/2015

• Automation acquisition was completed on April 1, 2015

Net debt (EUR million) and gearing (%) Equity to assets ratio (%)

-39-54

-158 -166 -134

238 229178 192

-5% -7%

-20% -21%-17%

29% 28%

21%24%

-30%

-20%

-10%

0%

10%

20%

30%

-300

-200

-100

0

100

200

300

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

Net debt (EUR million) Gearing (%)

40% 40% 41% 42%

34% 35% 35% 36% 35%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Q1/1

4

Q2/1

4

Q3/1

4

Q4/1

4

Q1/1

5

Q2/1

5

Q3/1

5

Q4/1

5

Q1/1

6

985 967902 877

1,239 1,240 1,214 1,2311,184

1%2% 2%

10% 10%

12%

14% 14%13%

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16

Capital employed Comparable ROCE (before taxes), rolling 12 months

Capital employed and Comparable ROCE


• Return on capital employed (ROCE) target: 15%

Capital employed (EUR million) and Comparable return on capital employed (ROCE),

before taxes1 (percent)

1) Rolling 12 months

Valmet continues to invest in operational excellence


New ERP solution renews and improves Valmet’s operational capability

Objectives of the program

• The purpose of the program is to renew and improve Valmet’s operational capability through

- Process harmonization and standardization

- ERP platform for renewal and modernization

- Data & reporting quality improvement

• The program benefits are based on process efficiency, data quality accuracy and savings on IT platform simplification

• The program is expected to take 4 years

Estimated costs in Phase Nordics

• Total investment approximately EUR 50 million, of which EUR 30 million external investment and EUR 20 million expenses

• External investment will be capitalized and depreciated over expected useful life

• Annual global benefits expected to exceed EUR 30 million from 2020

Risk management

• Strong Valmet team, supported by global technology partner

• Standard operating procedure utilization: best practice based standards for processes, data and system build

• Phased roll out starting in Nordics, experiences will be utilized in other countries

Guidance, and short-term market outlook

Guidance and short-term market outlook

27 April 27, 2016 © Valmet | Interim Review, January–March 2016

SatisfactoryPulp and

Energy

Paper

Satisfactory

Pulp

Energy

Board and Paper

Tissue

Guidance for

2016

Services

Short-term market outlook

Guidance for 2016 (as given on February 9, 2016)

Good

Weak

Good

Satisfactory

Satisfactory

Good

Weak

Satisfactory

Satisfactory

Q2/2015 Q3/2015

Satisfactory

Satisfactory

Satisfactory

Good

Satisfactory

Q4/2015

Satisfactory

Satisfactory

Good

Satisfactory

Q1/2016

Valmet estimates that net sales in 2016 will remain at the same level with

2015 (EUR 2,928 million) and Comparable EBITA in 2016 will increase in

comparison with 2015 (EUR 182 million).

Satisfactory Satisfactory Satisfactory SatisfactoryAutomation

The short-term market outlook is given for the next six months from the ending of the respective quarter.

Due to new regulation by the European Securities and Market Authority, Valmet has decided to replace the performance measure ‘EBITA before non-recurring

items’ with ‘Comparable EBITA’. The content of items affecting comparability, i.e. items previously disclosed as non-recurring, remain unchanged and therefore

‘Comparable EBITA’ equals previously disclosed ‘EBITA before non-recurring items’ (EUR 182 million in 2015). Items affecting comparability consist of income

and expenses arising from activities that amend the capacity of Valmet’s operations or are incurred outside its normal course of business.

Summary of Interim Review Q1/2016


Orders received and net sales increased in capital business2


Q1/2016 in brief

1) Stable business = Services and Automation business lines

2) Capital business = Pulp and Energy, and Paper business lines

Net debt EUR 192 million

Profitability improved compared to Q1/2015, but was below

the targeted level

Orders received and net sales increased in stable business1

Appendix

0

50

100

150

200

250

300

350

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Structure of loans and borrowings


Amount of outstanding interest-bearing debt

(EUR millions)

• Average maturity of long-term loans is 3.4 years- Average interest rate is 1.2%

Main financing sources

Back-up facilities

Interest-bearing debt EUR 371 million as at March 31, 2016

EUR 88 million

EUR 86 million

European Investment Bank

Skandinaviska Enskilda Banken

Nordic Investment Bank

Amount Lender

EUR 61 million Swedish Export Kredit

EUR 95 million

None outstanding

EUR 200 million domestic commercial

paper program

EUR 200 million syndicated revolving

credit facility

Amount Outstanding

EUR 40 million

© Valmet | Interim Review, January–March 201632 April 27, 2016

Largest shareholders on March 31, 2016Based 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 Varma Mutual Pension Insurance Company 6,108,465 4.08%

3 Solero Luxco S.A.R.L 5,374,482 3.59%

4 Nordea Funds 3,395,486 2.27%

5 Ilmarinen Mutual Pension Insurance Company 3,388,055 2.26%

6 Elo Pension Company 2,510,000 1.67%

7 The State Pension Fund 1,695,000 1.13%

8 Keva 1,502,166 1.00%

9 Danske Invest Funds 1,318,700 0.88%

10 Mandatum Life Insurance Company Limited 1,217,307 0.81%

10 largest shareholders, total 43,204,948 28.83%

Other shareholders 106,659,671 71.17%

Total 149,864,619 100.00%

Largest shareholders

1) A holding company that is wholly owned by the Finnish State

• The holding of Cevian Capital Partners Ltd. decreased on March 4, 2016 to 0 shares (previously 10,323,191 shares),

corresponding to an ownership of 0.00% (previously 6.89%) of Valmet’s shares.


Ownership structure on March 31, 2016

1) A holding company that is wholly owned by the Finnish State

The ownership structure is based on the classification of sectors determined by Statistics Finland.

Sector Number of shareholders % of total shareholders Number of shares % of shares

Nominee registered and non-Finnish holders 314 0.7% 69,694,143 46.5%

Finnish institutions, companies and foundations 2,649 5.5% 41,428,708 27.6%

Solidium Oy10 0.0% 16,695,287 11.1%

Finnish private investors 45,291 93.9% 22,046,481 14.7%

Total 48,254 100.0% 149,864,619 100.0%

46.5%

27.6%

11.1%

14.7%

Nominee registered and non-Finnish holders

Finnish institutions, companies and foundations

Solidium Oy

Finnish private investors


Share of non-Finnish holders and number of shareholders

47,000

49,000

51,000

53,000

55,000

57,000

59,000

44%

46%

48%

50%

52%

54%

56%

12/2

01

3

01/2

01

4

02/2

01

4

03/2

01

4

04/2

01

4

05/2

01

4

06/2

01

4

07/2

01

4

08/2

01

4

09/2

01

4

10/2

01

4

11/2

01

4

12/2

01

4

01/2

01

5

02/2

01

5

03/2

01

5

04/2

01

5

05/2

01

5

06/2

01

5

07/2

01

5

08/2

01

5

09/2

01

5

10/2

01

5

11/2

01

5

12/2

01

5

01/2

01

6

02/2

01

6

03/2

01

6

Non-Finnish holders (LHS) Total number of shareholders (RHS)

Paper, board, and tissue production trends


Source: RISI

North America (million tonnes) Europe (million tonnes)

China (million tonnes) Asia-Pacific (million tonnes)

10

20

30

40

4

6

8

10

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

Tissue (LHS) Newsprint (LHS)Printing & Writing (RHS) Containerboard (RHS)Cartonboard (RHS)

10

15

20

25

30

35

40

5

7

9

11

13

15

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19


5

15

25

35

45

55

2

4

6

8

10

12

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19


5

10

15

20

25

30

35

40

3

4

5

6

7

8

9

10

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19


Paper, board, and tissue operating rates


Source: RISI

North America Europe

China Asia-Pacific

75%

80%

85%

90%

95%

100%

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

Tissue Newsprint Printing & WritingContainerboard Cartonboard

80%

85%

90%

95%

100%

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19


70%

80%

90%

100%

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19


75%

80%

85%

90%

95%

100%

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19


Paper and board consumption growth trends


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

Easte

rn E

uro

pe

We

ste

rn E

uro

pe

No

rth

Am

erica

Latin

Am

eri

ca

Ja

pa

n

Chin

a

Rest o

f A

sia

Ocea

nia

Afr

ica

Mid

dle

Ea

st

Consumption per capita, kg (LHS) Population, million (RHS)

0

5

10

15

20

25

0

500

1,000

1,500

2,000

2,500

Easte

rn E

uro

pe

We

ste

rn E

uro

pe

Nort

h A

me

rica

Latin

Am

eri

ca

Ja

pa

n

Ch

ina

Rest o

f A

sia

Ocea

nia

Afr

ica

Mid

dle

Ea

st

Population, million (LHS) Consumption per capita, kg (RHS)

Tissue consumption growth trends


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-D

ec-0

7

1-M

ar-

08

1-J

un-0

8

1-S

ep

-08

1-D

ec-0

8

1-M

ar-

09

1-J

un-0

9

1-S

ep

-09

1-D

ec-0

9

1-M

ar-

10

1-J

un-1

0

1-S

ep

-10

1-D

ec-1

0

1-M

ar-

11

1-J

un-1

1

1-S

ep

-11

1-D

ec-1

1

1-M

ar-

12

1-J

un-1

2

1-S

ep

-12

1-D

ec-1

2

1-M

ar-

13

1-J

un-1

3

1-S

ep

-13

1-D

ec-1

3

1-M

ar-

14

1-J

un-1

4

1-S

ep

-14

1-D

ec-1

4

1-M

ar-

15

1-J

un-1

5

1-S

ep

-15

1-D

ec-1

5

1-M

ar-

16

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


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-Aug-10 1-Mar-11 1-Oct-11 1-May-12 1-Dec-12 1-Jul-13 1-Feb-14 1-Sep-14 1-Apr-15 1-Nov-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


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


Source: Bloomberg

Europe

0

1

2

3

4

5

6

7

0

20

40

60

80

100

120

140


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


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


Source: Bloomberg

United States

0

1

2

3

4

5

6

7

8

9

10

2-N

ov-1

2

2-D

ec-1

2

2-J

an-1

3

2-F

eb

-13

2-M

ar-

13

2-A

pr-

13

2-M

ay-1

3

2-J

un-1

3

2-J

ul-1

3

2-A

ug-1

3

2-S

ep-1

3

2-O

ct-

13

2-N

ov-1

3

2-D

ec-1

3

2-J

an-1

4

2-F

eb

-14

2-M

ar-

14

2-A

pr-

14

2-M

ay-1

4

2-J

un-1

4

2-J

ul-1

4

2-A

ug-1

4

2-S

ep-1

4

2-O

ct-

14

2-N

ov-1

4

2-D

ec-1

4

2-J

an-1

5

2-F

eb

-15

2-M

ar-

15

2-A

pr-

15

2-M

ay-1

5

2-J

un-1

5

2-J

ul-1

5

2-A

ug-1

5

2-S

ep-1

5

2-O

ct-

15

2-N

ov-1

5

2-D

ec-1

5

2-J

an-1

6

2-F

eb

-16

2-M

ar-

16

European Energy Exchange (EEX) spot price (EUR/t)

European Carbon Emission Allowance


Source: Bloomberg

Important notice


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,

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Interim Review January–June 2016

July 28, 2016

www.valmet.com/investors

Capital Markets Day

September 20, 2016Helsinki, Finland

More information to follow!

Valmet's Interim Review January-March 2016

Investor Relations

Transcript of Valmet's Interim Review January-March 2016