MONDI PACKAGING PAPER WIECIE S.A. Investor and Analyst - PowerPoint PPT Presentation

MONDI PACKAGING PAPER Ś WIECIE S.A. Investor and Analyst Presentation 27 November, 2007 Maciej Kunda

AGENDA � Poland � Company History � Management team � Mill overview � Products � Key financials � Post acquisition highlights � Competitive Advantages MPP Swiecie � Site visit briefing PAGE 1

POLAND � Area: 312,685 km 2 Mondi Packaging Lithuania Paper Ś wiecie S.A. � Population: 38.5 million � Main industries: coal, textile, chemical, machinery, iron and steel Ś wiecie Belarus sectors Bydgoszcz � Forest land: 28% Warsaw Germany Pozna ń Poland Cracow Czech Ukraine Republic Slovakia PAGE 2

MACROECONOMIC INDICATORS – POLAND 2002 2003 2004 2005 2006 2007 2008 2009 Real GDP (change in %) 1.4 3.9 5.3 3.6 6.1 6.6 5.3 5.2 Unemployment rate (in %) 19.9 19.6 19.0 17.7 13.8 11.2 9.7 8.4 Inflation (avg in %) 1.9 0.7 3.6 2.2 1.3 2.2 2.8 2.8 PLN/EUR (avg) 3.9 4.4 4.5 4.0 3.9 3.8 3.7 3.7 GDP/Capita (in EUR) 5,480 5,480 5,013 5,327 6,700 7,100 7,600 8,055 Direct foreign investment in EUR m 25.0 9,000 8,000 15,061 20.0 7,000 6,000 15.0 5,000 9,983 8,280 4,000 10.0 3,000 4,313 4,383 2,000 5.0 1,000 0.0 0 2002 2003 2004 2005 2006 2007 2008 2009 2007 2008 2009 2010 2011 GDP/Capita in EUR Real GDP (change in %) Unemployment Rate in % Inflation (avg) in % PAGE 3

40 YEAR HISTORY 2007 1997 1992 Privatisation 1991 Mondi 60% Restruct- uring Transformation into Joined Stock Company 1976 1972 1961 NSCC 1967 Kraft Plant Pulp Dissolving Plant Pulp Plant 61 62 63 64 65 66 67 68 69 1970 71 72 73 74 75 76 77 78 79 1980 81 82 83 84 85 86 87 88 89 1990 91 92 93 94 95 96 97 98 99 2000 01 02 03 04 05 06 07 1997 – 2003 1970 – 1976 New strategy Start-up of 5 PMs implementation ZCiP Celuloza PAGE 4

OVERVIEW - MANAGEMENT TEAM Maciej Kunda Florian Stockert Jan Ż ukowski CEO (41 years of age) Tomasz Katewicz Adam Mrzyg ł ód Development and Sales Director Investment Director (48 years of age) (55 years of age) Financial Director Production Director (34 years of age) (42 years of age) PAGE 5

OVERVIEW - STRUCTURE OF THE MIL PM 1 PM 2 PM 3 PM 4 PM 5 134.000 to 200.000 to 118.000 to 174.000 to 194.000 to 5.3 m 4.4 m 4.4 m 4.4 m 5.3 m Sackpaper Kraftliner Testliner Sc fluting Light weight Light weight 150 – 330 g/m 2 Kraftliner 90 – 140 g/m 2 Kraftliner Recovered paper 2xcontinuous digesters Semichemical pulp plant preparation plant Power OCC - 293.000 to; plant Kraft pulp NSSC pulp Mix - 45.000 to 373.000 TO 106.000 TO Pine Birch Evaporation plant Causticizing plant Recovery boiler Wood handling system Chemical recovery department Operation certified ISO 9001, ISO 14001, OHSAS 18001 and FSC PAGE 6

MARKET SEGMENTATION BY END-USE APPLICATION Lafarge, Bayer • Cement Higher gsm • Premixes • Fruits, vegetables, meat • Feed • Heavy duty packaging • Chemicals Sack Paper • Electronics • Fruits Lower gsm 10% • Vegetables • Cosmetics, medicines • Meat • Internet sales • Flowers S.C. Fluting 21% Pizza boxes • Heavy duty packaging 53% Kraftliner • Industrial • Chemicals • Coating P&G, Pizza Hut, 16% Kimberly & Clark Henkel, Pizza Hut, Testliner Nestle, Tesco, Carrefour • Merchant • Chemicals • Beverages • Furnitures IKEA, P&G, Kimberley & Clark PAGE 7

FINANCIAL INDICATORS MPP SWIECIE Sales (PLN B) / ROCE 1 Profitability (HY 2007) % change 2007 2006 Sales ROCE 1 (PLN B) (%) 35 26.5 20.5 33.2 27.5 33.0 EBITDA PLN 220 M 184 M 19.6 30 25 0,5 EBITDA 31.9 % 29.6% 7.7 20 Margin 1.30 15 1.26 1.19 Capital 10 PLN 1 032 M 956 M 7.9 0.69 0.63 Employed 5 0 0,0 2004 2005 2006 2006 HY 2007 HY ROCE 1 33.0% 27.5% 20.1 1 Half year ROCE is calculated as underlying profit H1 2007 times 2 divided by average capital employed as of June 30 and December 31 PAGE 8

POST ACQUISITION HIGHLIGHTS

POST ACQUISITION HIGHLIGHTS - TRANSFORMATION OF THE COMPANY Process Change Celuloza MPP Performance Ś wiecie Ś wiecie Goal Goal Operational, Financial, HR, Sales, Quality, Environmental, Safety Capacity Value Creation Utilization High Performance Past Now Time PAGE 10

POST ACQUISITION HIGHLIGHTS – MAJOR CAPITAL PROJECTS 1998-2006 Proactive Early action against foreseen trends, developments and Investment changes in business environment (markets, customer Strategy needs, changes in operational environment). Market Development Focus Project Targets / Achievements 2001 Paper Machine #5 Rebuild � Effective production of high quality LW KLB Focus: Increase of production of � Production increase +50,000 t / +90,000 t lightweight kraftliner grades 2003 Paper Machine #3 Rebuild � Effective production of 2 layer TL and WBFL Focus: Ability to produce 2-layer � Quality targets 100% met medium and lightweight recycled containerboard quality 2007 Paper Machine #1 Rebuild � Effective production of high quality 2 layer LW KLB Focus: Increase of production of � Capacity increase from 130,000 to 180,000 t lightweight kraftliner grades Promises kept - delivered more PAGE 11

POST ACQUISITION HIGHLIGHTS – MAJOR CAPITAL PROJECTS 1998-2006 Proactive Early action against foreseen trends, developments and Investment changes in business environment (markets, customer Strategy needs, changes in operational environment). Early Action against foreseen changes in operational environment Project Targets / Achievements 2001 New Woodyard � Wood losses reduction by 70% Focus: Improvement of wood pulp � High quality of chips and pulp produced quality; reduction of wood losses 2004 CFB Biofuel Boiler Effective green energy production based on biofuel � Focus: Energy cost savings / � Reduction of coal usage by 130,000 tpa green energy generation together with substantial reduction of emission Promises kept - delivered more PAGE 12

POST ACQUISITION HIGHLIGHTS – TOTAL PM PRODUCTION 1970 – 2007 Production nearly doubled during last 10 years: 1.000 tons 824 797 760 737 Mondi 690 start to be majority 631 +85% shareholder 603 538 488 446 435 428 416 391 384 386 380 381 379 362 346 341 333 318 318 316 307 299 295 282 259 251 223 171 136 81 33 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 PAGE 13

POST ACQUISITION HIGHLIGHTS – PRODUCTIVITY INCREASE Productivity increase by 770 tons per capita, compared to 1997 Employees, average Total productivity in tons 3500 970 902 3,124 870 823 3000 2,703 770 722 652 2500 670 587 570 2000 1,986 459 470 409 1500 1,473 1,379 370 1,176 273 1,131 1,054 969 913 270 1000 191 132 95 79 170 63 69 50 500 48 28 24 21 70 6 49 41 41 38 38 22 30 13 21 0 -30 -23 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Increase due to bigger production Employees, average Increase due to headcount reduction Total productivity PAGE 14

POST ACQUISITION HIGHLIGHTS – PROGRESS IN SAFETY O T T O O T T O Zer O T olerance T arget Zer O Number of Accidents 1997-2006 Development of Lost Time Injury (including sub contractors) Frequency Rate (LTIFR) 1997 - 2006 LTIFR 3,0 2006 Mondi 43* Safety Award 2,5 37* for Best in Class Large Unit 31* 2,0 1,82 1,50 1,50 1,43 1,5 1,35 21* 18* 1,0 9* 0,57 0,5 3 0,20 2 0,14 0,07 1 1 0,07 0,0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 * Excluding contractors PAGE 15

COMPETITIVE ADVANTAGE OF MPP Ś WIECIE Competitive Advantage of MPP Ś wiecie driven by � Clear cost advantage in energy and labor cost � Cost advantage in transportation to European markets � Capability of most effective fibre mix (wood and recovered fibre) � Swiecie is a world class mill in terms of productivity Swiecie has an excellent track record with all big capex: they were � flawlessly executed within time and within budget increasing Company Value � Organization culture managed by objectives, employees creativity � Excellent Technical service Innovative products � PAGE 16

COST COMPETITIVNESS OF UNBLEACHED KRAFTLINER €/tons Cost level 2006/III 500 Delivered costs 450 to Frankfurt 400 350 Swiecie PM2 300 Swiecie PM1 Swiecie PM5 250 200 150 100 50 0 0 500 1.000 1.500 2.000 2.500 3.000 3.500 Cumulative capacity, k tons p.a. 1 Including European supply and imports 2 Depreciations + ROCE 10% Source: Pöyry Forest Industry Consulting PAGE 17

SITE VISIT BRIEFING

SITE VISIT BRIEFING PAGE 19