Quarter ended		Nine months ended
US$ million	Note			Jun 2024	Jun 2023	Jun 2024	Jun 2023
Sales				1,370	1,326	3,994	4,428
Cost of sales				1,204	1,200	3,431	3,770
Gross profit				166	126	563	658
Selling, general and administrative expenses				91	79	292	261
Other operating (income) expenses				(4)	(8)	212	2
Share of (profit) loss from equity accounted investees				(3)	(1)	–	–
Operating profit (loss)	3			82	56	59	395
Net finance costs				19	14	50	32
Finance costs				28	25	79	79
Finance income				(6)	(7)	(22)	(39)
Net foreign exchange gain				(3)	(4)	(7)	(8)
Profit (Loss) before taxation				63	42	9	363
Taxation				12	2	55	64
Profit (Loss) for the period				51	40	(46)	299
Basic earnings per share (US cents)	4			9	7	(8)	53
Weighted average number of shares in issue (millions)				599.4	561.2	576.8	565.1
Diluted earnings per share (US cents)	4			8	7	(8)	50
Weighted average number of shares on fully diluted basis (millions)				605.0	599.9	582.3	603.9

			Quarter ended		Nine months ended
US$ million			Jun 2024	Jun 2023	Jun 2024	Jun 2023
Profit (Loss) for the period			51	40	(46)	299
Other comprehensive income, net of tax
Items that will not be reclassified subsequently to profit or loss			–	–	–	(2)
Actuarial gains (losses) on post-employment benefit funds			–	–	–	(3)
Tax effect			–	–	–	1
Items that may be reclassified subsequently to profit or loss			57	(72)	51	(67)
Exchange differences on translation of foreign operations			54	(73)	47	(97)
Movements in hedging reserves			4	1	5	33
Tax effect			(1)	–	(1)	(3)
Total comprehensive income for the period			108	(32)	5	230

US$ million	Note			Jun 2024	Reviewed Sept 2023
ASSETS
Non-current assets				3,971	3,742
Property, plant and equipment				2,998	2,886
Right-of-use assets				79	69
Plantations				565	488
Deferred tax assets				84	75
Goodwill and intangible assets				108	88
Equity accounted investees				10	9
Other non-current assets	8			127	127
Current assets				1,896	2,054
Inventories				835	777
Trade and other receivables				682	658
Derivative financial assets				11	14
Taxation receivable				3	4
Cash and cash equivalents				365	601
Total assets				5,867	5,796
EQUITY AND LIABILITIES
Shareholders’ equity
Ordinary shareholders’ interest				2,429	2,445
Non-current liabilities				2,213	2,035
Interest-bearing borrowings				1,479	1,329
Lease liabilities				73	61
Deferred tax liabilities				412	394
Defined benefit and other liabilities				249	251
Current liabilities				1,225	1,316
Interest-bearing borrowings				131	266
Lease liabilities				22	30
Trade and other payables				987	908
Provisions	8			31	80
Derivative financial liabilities				–	3
Taxation payable				54	29
Total equity and liabilities				5,867	5,796
Number of shares in issue at balance sheet date (millions)				599.4	558.8

	Quarter ended		Nine months ended
US$ million	Jun 2024	Jun 2023	Jun 2024	Jun 2023
Profit (Loss) for the period	51	40	(46)	299
Adjustment for:
Depreciation, fellings and amortisation	84	82	257	245
Taxation	12	2	55	64
Net finance costs	19	14	50	32
Defined post-employment benefits paid	(5)	(5)	(19)	(23)
Plantation fair value adjustments	(31)	(38)	(110)	(92)
Asset impairments	(3)	–	2	–
(Profit) Loss on disposal of held-for-sale assets	–	–	–	1
Net restructuring provisions	1	–	142	–
(Profit) Loss on disposal and written-off assets	(8)	–	(9)	–
Other non-cash items(1)	2	(4)	49	7
Cash generated from operations	122	91	371	533
Movement in working capital	44	89	(44)	14
Closure and restructuring costs paid	(61)	–	(237)	–
Finance costs paid	(15)	(33)	(53)	(98)
Finance income received	6	7	22	22
Taxation (paid) refund	(3)	(14)	(30)	(28)
Dividend paid	–	–	(84)	(85)
Cash (utilised by) generated from operating activities	93	140	(55)	358
Cash utilised in investing activities	(61)	(67)	(216)	(224)
Capital expenditure	(108)	(62)	(248)	(203)
Proceeds on disposal of assets	49	–	51	1
Proceeds on held-for-sale assets	–	–	–	10
Additions to non-current and intangible asset	(2)	(5)	(19)	(32)
Net cash (utilised) generated	32	73	(271)	134
Cash effects of financing activities	(61)	(130)	33	(447)
Proceeds from interest-bearing borrowings	80	–	295	–
Repayment of interest-bearing borrowings	(135)	(102)	(244)	(408)
Share repurchases	–	(22)	–	(22)
Capital lease repayments	(6)	(6)	(18)	(17)
Net movement in cash and cash equivalents	(29)	(57)	(238)	(313)
Cash and cash equivalents at beginning of period	392	557	601	780
Translation effects	2	4	2	37
Cash and cash equivalents at end of period	365	504	365	504

(1)

Other non-cash items for the nine months ended June 2024 include accruals for closure costs at Lanaken of US$40 million (€37 million), non-cash movements in the defined benefit liabilities and plan assets of US$16 million (2023: US$14 million) and share-based charges of US$5 million (2023: US$5 million).

	Nine months ended
US$ million	Jun 2024	Jun 2023
Balance – beginning of period	2,445	2,358
Profit (Loss) for the period	(46)	299
Other comprehensive income for the period	51	(69)
Issue of shares	58	3
Dividend – 15 US cents	(84)	(85)
Share repurchases	–	(22)
Share-based payment reserve	5	5
Balance – end of period	2,429	2,489
Comprising
Ordinary share capital and premium	767	683
Non-distributable reserves	119	109
Foreign currency translation reserves	(225)	(243)
Hedging reserves	(51)	(52)
Retained earnings	1,819	1,992
Total equity	2,429	2,489

(this information has not been audited or reviewed)

General definitions

Average – averages are calculated as the sum of the opening and closing balances for the relevant period divided by two

Capital employed – shareholders’ equity plus net debt

Covenant leverage ratio – net debt divided by last 12 months’ EBITDA excluding special items as defined by our bank covenants

EBITDA excluding special items – earnings before interest (net finance costs), taxation, depreciation, amortisation and special items

EPS excluding special items – earnings per share excluding special items and certain once-off finance and tax items

Fellings – the amount charged against the income statement representing the standing value of the plantations harvested

Headline earnings – as defined in circular 1/2023, as issued by the South African Institute of Chartered Accountants, separates from earnings all separately identifiable remeasurements. It is not necessarily a measure of sustainable earnings. It is a Listings Requirement of the JSE Limited to disclose headline earnings per share

Interest cover – last 12 months’ EBITDA excluding special items to net interest adjusted for refinancing costs

NBSK – Northern Bleached Softwood Kraft pulp. One of the main varieties of market pulp, produced from coniferous trees (ie spruce, pine) in Scandinavia, Canada and northern USA. The price of NBSK is a benchmark widely used in the pulp and paper industry for comparative purposes

Net assets – total assets less total liabilities

Net asset value per share – net assets divided by the number of shares in issue at balance sheet date

Net debt – current and non-current interest-bearing borrowings and lease liabilities, bank overdrafts less cash and cash equivalents

Net debt to EBITDA excluding special items – net debt divided by the last 12 months’ EBITDA excluding special items

Net operating assets – total assets (excluding deferred tax assets and cash) less current liabilities (excluding interest-bearing borrowings, lease liabilities and overdraft)

Operating profit – profit from business operations before deduction of net finance costs and taxes

Non-GAAP measures – the group believes that it is useful to report certain non-GAAP measures for the following reasons:

• these measures are used by the group for internal performance analysis
• the presentation by the group’s reported business segments of these measures facilitates comparability with other companies in our industry, although the group’s measures may not be comparable with similarly titled profit measurements reported by other companies
• it is useful in connection with the discussion with the investment analyst community and debt rating agencies

These non-GAAP measures should not be considered in isolation or construed as a substitute for GAAP measures in accordance with IFRS

ROCE – annualised return on average capital employed. Operating profit excluding special items divided by average capital employed

RONOA – return on average net operating assets. Operating profit excluding special items divided by average net operating assets

Special items – special items cover those items which management believes are material by nature or amount to the operating results and require separate disclosure. Such items would generally include profit or loss on disposal of property, investments and businesses, asset impairments, restructuring charges, non-recurring integration costs related to acquisitions, financial impacts of natural disasters and settlement gains or losses on defined benefit obligations

The above financial measures are presented to assist our shareholders and the investment community in interpreting our financial results. These financial measures are regularly used and compared between companies in our industry

Summary Rand convenience translation

	Quarter ended		Nine months ended
	Jun 2024	Jun 2023	Jun 2024	Jun 2023
Key figures (ZAR million)
Sales	25,442	24,772	74,789	79,802
Operating profit excluding special items(1)	1,579	766	5,374	6,614
Special items – (gains) losses(1)	56	(280)	4,269	(505)
EBITDA excluding special items(1)	2,804	1,980	9,175	10,146
Profit for the period	947	747	(861)	5,389
Basic earnings per share (SA cents)	158	133	(149)	954
Net debt(1)	24,378	22,149	24,378	22,149
Key ratios (%)
Operating profit excluding special items to sales	6.2	3.1	7.2	8.3
Operating profit excluding special items to capital employed (ROCE)(1)	9.1	4.5	10.6	13.3
EBITDA excluding special items to sales	11.0	8.0	12.3	12.7

(1)	Refer to supplemental information for the definition of the term.

The above financial results have been translated into Rand from US Dollar as follows:

• assets and liabilities at rates of exchange ruling at period-end; and
• income, expenditure and cash flow items at average exchange rates.

Exchange rates

	Jun 2024	Mar 2024	Dec 2023	Sept 2023	Jun 2023
Exchange rates:
Period-end rate: US$1 = ZAR	18.1925	18.8688	18.2969	18.9299	18.8338
Average rate for the quarter: US$1 = ZAR	18.5706	18.8776	18.7269	18.6387	18.6817
Average rate for the year to date: US$1 = ZAR	18.7254	18.8027	18.7269	18.1791	18.0221
Period-end rate: €1 = US$	1.0715	1.0795	1.1037	1.0572	1.0912
Average rate for the quarter: €1 = US$	1.0765	1.0860	1.0763	1.0881	1.0887
Average rate for the year to date: €1 = US$	1.0796	1.0811	1.0763	1.0679	1.0612

Sappi share price – June 2022 to June 2024