UPM-Kymmene (UPM) Investor presentation summary

Strategic portfolio and growth initiatives

• Focus on decarbonization solutions, advanced materials, renewable fibres, and communication papers to drive growth and margin expansion.

• Portfolio initiatives aim to increase growth potential and profitability, with emphasis on electrification, biofuels, and biochemicals.

• Planned joint venture with Sappi in graphic papers and demerger of plywood business to enhance core focus and shareholder value.

• Sales excluding Communication Papers and Plywood show consistent growth above GDP.

• Global expansion targets accelerated growth, with increasing sales outside Europe.

Financial performance and targets

• Q1 2026 comparable EBIT was €274 million (10.9% of sales), with strong results in decarbonization and advanced materials.

• Group targets include EBIT growth and a 10% ROE, with net debt/EBITDA policy at ≤2x.

• Long-term return targets set for each business area, focusing on ROCE and FCF/CE.

• Capital expenditure is expected to remain low after recent major investments, with 2026 capex estimated at €300 million.

• Dividend policy aims to pay at least half of comparable EPS, with €1.50/share for 2025.

Business segment highlights

• Decarbonization solutions delivered record Q1 results in Energy and strong performance in Biofuels; biochemicals ramp-up continues.

• Advanced materials showed resilient performance, with growth in higher-margin products and regions.

• Renewable fibres benefited from cost optimization and stable demand, especially in Fibres South.

• Communication Papers and Plywood had solid Q1, with ongoing joint venture and demerger plans.