Debt Investor Presentation 1Q 2014 13.5. 2014 Metsä Board Metsä Group
Successful Early Refinancing Completed in 1Q 2014 Net Debt, m€ 3000 ‒ The new unsecured financing package consists of ‒ EUR 225 million bond issue at coupon of 4 per cent (over 10 2403 2500 times oversubscribed) ‒ EUR 150 million term loan ‒ EUR 100 million revolving credit facility 2000 ‒ Gross debt EUR 721 million, cash and interest bearing 1500 receivables EUR 129 million and net debt EUR 593 million ‒ Net gearing 69%, equity ratio 41% and average interest rate 1000 4.3% at the end of 1Q 2014 593 500 ‒ Lielahti real estate in Finland was divested for EUR 26 million. EUR 19.7 million was paid for UPM based on the Court of 0 Arbitration’s judgment 1Q14 2006 2007 2008 2009 2010 2011 2012 2013 2 Metsä Board Metsä Group
Loans and Interest Rate At the end of 1Q 2014 ‒ Average maturity of long term loans 3,9 years ‒ Average interest rate of loans (including derivatives) 4,3 % ‒ Interest rate maturity of loans (including derivatives) 33,8 months ‒ Of the loans about 26 per cent was subject to variable interest rates and 74 per cent to fixed interest rates 3 Metsä Board Metsä Group
Diversified Funding Sources Long-Term Interest Bearing Liabilities 31.3. 2014 8 % 3 % 31 % Bonds Pension premium loans Loans from financial institutions 28 % Finance leases Other interest bearing liabilities 30 % Solid liquidity position with 100m€ RCF fully undrawn and 121 m€ of cash and cash equivalent at the end of 2013. Additionally, 150 m€ reserve in form of Metsä Group's internal undrawn short-term credit facility 4 Metsä Board Metsä Group
Interest Bearing Net Liabilities 31.3.2014 m€ ‒ Long-term 716 ‒ Short-term 5 Total interest bearing liabilities 721 ‒ Liquidity and interest bearing receivables 128 Interest bearing net liabilities 593 5 Metsä Board Metsä Group
Well Balanced Maturity Schedule Long-term Interest Bearing Liabilities and Committed Undrawn Credit Facilities 31.3.2014 m€ 300 253 250 Long-term interest bearing liabilities Committed undrawn credit facilities 200 181 150 100 94 100 83 44 50 34 24 14 4 0 2014 2015 2016 2017 2018 2019 2020 >2 020 6 Metsä Board Metsä Group
Balance Sheet Ratios Equity Ratio Net gearing % % 45 41,0 75 80 74 40,7 38,7 69 70 69 40 70 33,3 32,4 35 60 30 50 25 40 20 30 15 20 10 10 5 0 0 1Q13 2Q13 3Q13 4Q13 1Q14 1Q13 2Q13 3Q13 4Q13 1Q14 7 Metsä Board Metsä Group
Debt Programs 31.3.2014 The following table sets forth the significant debt securities issued and outstanding of Metsä Board as at March 31, 2014 Average Long-term borrowings Total amount Outstanding I nterest Rate * ) Maturity (currency in millions) EUR 225 million Bond Issue 2014 EUR 225 EUR 225 4,5 % 2019 Syndicated credit facility 2014 EUR 250 EUR 150 5,0 % 2018 EUR 107 million bilateral loans EUR 107 EUR 107 3,6 % 2014-2017 EUR 24 million finance leases EUR 24 EUR 24 2,3 % 2014-2020 EUR 231 million pension loans EUR 231 EUR 217 4,0 % 2014–2020 *) The average interest rate take into account outstanding interest rate swaps and amortised arrangement fees. Average interest rate of all Metsä Board interest bearing liabilities including interest rate derivatives per 31.3.2014 is 4,3 %. The following table sets forth Metsä Board´s principal long-term liquidity reserves as at March 21, 2014: Average Liquidity reserves Total amount Outstanding I nterest Rate * ) Maturity (EUR in millions) Revolving Credit Facility 2014 EUR 100 EUR 0 – 2018 Pension loan facilities EUR 231 EUR 217 4,0 % - Short-term funding programmes Metsä Group internal short-term limit EUR 150 EUR 0 – 0-12 months Metsä Group Treasury funding programmes: EUR 150 million domestic CP-program EUR 150 EUR 14 0,4 % 0-12 months 8 Metsä Board Metsä Group
Ratings’ History 2000 2007 S&P: Short term ratings lowered to A3, Moody’s: Downgrade to B3, negative outlook Long term ratings placed to credit watch S&P: Downgrade to B, negative outlook negative S&P: Downgrade to B-, stable outlook Moody’s: Long and short term ratings 2008 outlook changed from stable to negative S&P: Outlook to negative 2001 2009 S&P: Long term ratings lowered to BBB-, S&P: Downgrade to CCC+, negative outlook stable outlook Moody’s: Downgrade to Caa1, outlook negative Moody’s: Long and short term ratings 2010 lowered to Baa3/P3, negative outlook S&P: Outlook to stable 2003 Moody’s: Outlook to stable S&P: Downgrade to BB+, stable outlook S&P: Upgrade to B-, stable outlook Moody’s: Downgrade to Ba1, negative Moody’s: Upgrade to B3, outlook to positive outlook 2011 2004 S&P: Outlook to positive S&P: Outlook changed from stable to S&P: Outlook to stable negative, ratings affirmed Moody’s: Outlook to stable Moody’s: Downgrade to Ba2, stable outlook 2012 2005 Moody’s: Outlook to positive S&P: Downgrade to BB, stable outlook 2013 Moody’s: Outlook changed from stable to negative, S&P: Outlook to positive ratings affirmed Moody’s: Upgrade to B2, outlook stable 2006 S&P: Upgrade to B, outlook stable S&P: Downgrade to BB-, negative outlook Moody’s: Outlook to positive Moody’s: Downgrade to Ba3, negative outlook Moody’s: Downgrade to B2, negative outlook S&P: Downgrade to B+, negative outlook 9 Metsä Board Metsä Group
Standard & Poor’s Positive Rating Development Moody’s BB+ | Ba1 BB | Ba2 BB- | Ba3 Stable B+ | B1 Positive B | B2 B- | B3 CCC+ | Caa1 CCC | Caa2 2005 2006 2007 2008 2009 2010 2011 2012 2013 10 Metsä Board Metsä Group
Thank You! www.metsaboard.com Juha Laine Headof IR +358 10 4654335 juha.laine@metsagroup.com Metsä Board Metsä Group
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