Quarter ended
EUR million	Dec 2025	Sept 2025	Jun 2025	Mar 2025	Dec 2024
Volumes sold – tons (000’s)	461	479	479	491	465
Revenue	457	483	503	523	517
Operating profit (loss) excluding special items	10	(31)	(19)	4	13
Operating profit (loss) excluding special items to revenue (%)	2.2	(6.4)	(3.8)	0.8	2.5
Adjusted EBITDA	33	(6)	4	25	35
Adjusted EBITDA to revenue (%)	7.2	(1.2)	0.8	4.8	6.8
RONOA pa (%)	3.7	(10.9)	(6.4)	1.4	4.6

Market conditions in the European region remained stable but challenging, characterised by intense competition, weak demand, and continued oversupply across all paper categories. Despite relatively steady sales volumes year-on-year, profitability was adversely affected by significantly lower pricing, which was only partially offset by cost saving initiatives. Strategic rationalisation actions advanced during the quarter with the completion of the previously announced paper machine closures at the Kirkniemi and Alfeld Mills and the successful reallocation of sales volumes to other assets within the region. Earnings included the annual energy refunds, which were approximately EUR32 million.

Underlying demand for packaging papers in European markets remained subdued, reflecting ongoing weak consumer sentiment and persistent overcapacity. Despite very weak paperboard demand ahead of the holiday season, segment sales volumes were up 3% year-on-year. Solid progress was achieved in growing our label papers business, with wet glue label paper sales volumes increasing by 21% compared to the prior year.

As across all European paper grades, weak demand and oversupply resulted in an intensely competitive pricing environment, leading to an 8% year-on-year decline in segment selling prices.

Graphic papers sales volumes have remained steady in recent quarters but were 2% below prior year levels. This performance represents a significant achievement given the rapidly declining regional demand, with quarterly industry deliveries for coated woodfree and coated mechanical papers estimated to have fallen by 5% to 7% year-on-year. The weak demand environment and substantial regional overcapacity was further exacerbated by trade tensions and US tariffs which have constrained exports to the US market and driven increased Asian imports into the region. These factors continued to place significant downward pressure on pricing, which was 13% below the previous year.

Variable costs decreased by 6% compared to the prior year due to lower purchased pulp and chemical costs. Fixed costs were 1% below last year.

	Quarter ended
US$ million	Dec 2025	Sept 2025	Jun 2025	Mar 2025	Dec 2024
Volumes sold – tons (000’s)	335	359	326	362	371
Revenue	395	429	404	440	458
Operating profit (loss) excluding special items	(30)	(3)	(21)	5	47
Operating profit (loss) excluding special items to revenue (%)	(7.6)	(0.7)	(5.2)	1.1	10.3
Adjusted EBITDA	(1)	28	5	29	71
Adjusted EBITDA to revenue (%)	(0.3)	6.5	1.2	6.6	15.5
RONOA pa (%)	(6.9)	(0.7)	(4.9)	1.2	12.3

Profitability of the North American region was adversely affected by the scheduled Somerset Mill maintenance shut⁽¹⁾, which reduced earnings in line with the guidance provided by US$17 million. In addition, significant utilities-related operational disruptions at both Somerset and Cloquet Mills reduced production, adversely impacted raw material usages and increased costs. Market conditions broadly softened and, in certain product categories, were further impacted by seasonal slowdowns and customer inventory drawdowns ahead of the calendar year-end.

⁽¹⁾ Maintenance shuts for Somerset Mill are scheduled at 18-month intervals. The last shut was in Q3 FY2024.

The weaker paperboard demand in the region, combined with our focus on balancing the trade-off between volume and pricing, resulted in a slower than anticipated ramp-up in sales volumes from Somerset Mill PM2. Paperboard sales volumes were nevertheless 15% above last year and customer trials and technical qualifications advanced during the quarter, with positive feedback received on product performance. However, the intensely competitive pricing environment led to a year-on-year decline of 8% in segment selling prices. Higher costs arising from the operational disruptions and low fixed cost absorption further weighed on segment profitability.

Graphic papers markets in the region remain in structural decline but an overall tighter domestic market balance, due to the removal of Somerset Mill PM2 capacity and tariff pressures on imports, provided support for pricing which remained in line with last year. Good progress was made in terms of carouselling activities to optimise product allocation across the asset base, which included the transfer of some high basis weight graphic paper volumes to the Somerset Mill PM1 paperboard machine. The operational disruptions reduced graphic papers production and constrained segment sales volumes. Although segment margins declined compared to the prior year, they remained at healthy levels.

Demand for DWP remained steady, with sales volumes increasing 5% year-on-year. However, significantly lower pricing reduced profitability for the pulp segment. High yield pulp⁽¹⁾ market demand remained subdued, and sales were decreased to match external demand and higher internal integration into paperboard production at the Somerset Mill.

⁽¹⁾ High yield pulp = bleached chemi-thermomechanical pulp (BCTMP).

Variable costs increased by 11% compared to the previous year with lower raw material prices, specifically purchased pulp and chemicals, offset by adverse raw material usage. Fixed costs were 8% above last year with lower personnel costs offset by higher maintenance costs due to the Somerset Mill shut, scheduled every 18 months, which did not occur in the equivalent quarter of last year.

	Quarter ended
ZAR million	Dec 2025	Sept 2025	Jun 2025	Mar 2025	Dec 2024
Volumes sold – tons (000’s)	749	751	644	690	665
Revenue	6,164	6,936	6,334	6,598	6,312
Operating profit (loss) excluding special items	205	1,121	550	148	1,234
Operating profit (loss) excluding special items to revenue (%)	3.3	16.2	8.7	2.2	19.6
Adjusted EBITDA	805	1,486	1,172	883	1,663
Adjusted EBITDA to revenue (%)	13.1	21.4	18.5	13.4	26.3
RONOA pa (%)	2.6	13.8	6.7	1.8	15.3

Profitability of the South African region was severely challenged by substantially lower US$ denominated DWP selling prices, compounded by adverse USD/ZAR exchange rate movements that further pressured earnings in the pulp segment. Demand across key product segments remained strong but a 12% year-on-year increase in sales volumes and ongoing cost saving initiatives were insufficient to offset the impact of pricing and exchange rate headwinds. The forestry fair value price adjustment for the quarter was a loss of ZAR146 million.

Demand for DWP was supported by favourable downstream VSF market conditions, with sales volumes rising 15% compared to the prior year, reflecting improved operational stability in the region. However, the combined effect of weaker US$ pricing and unfavourable exchange rate movements materially reduced ZAR-denominated selling prices by approximately 19%, weighing on pulp segment margins.

Underlying demand in domestic containerboard markets remained healthy, driven by strong agricultural activity. Although demand in the first quarter is typically seasonally softer, sales volumes exceeded the prior year by 16%. Despite these supportive dynamics, pricing continued to be constrained by weak global markets and competitive import pressure, declining 3% year-on-year and eroding margins in the packaging and speciality papers segment.

Demand for office paper improved relative to the previous quarter, supported by seasonal back-to-school demand. However, the graphic papers segment continues to contract in line with global trends and pricing faced additional pressure from competing imports.

Variable costs were 3% above last year driven by higher chemical and energy costs. Fixed costs were 4% below last year due to lower personnel costs.