UPM Kymmene Oyj : Investor Presentation - April 2024

UPM Biofore Beyond Fossils

Investor presentation

April 2024

1

This is UPM

SALES 2023

EUR 10.5 BILLION

Wood-based	BUSINESSES:
raw materials	UPM FIBRES
	UPM ENERGY
	UPM RAFLATAC
	UPM SPECIALTY PAPERS
	UPM COMMUNICATION PAPERS
Low-emission	​UPM PLYWOOD
energy	UPM BIOREFINING

54	RENEWABLE AND RECYCLABLE	11,000
PRODUCTS FOR:
production	customers
plants	PACKAGING​	COMMUNICATION ​
	LABELLING​	TISSUE AND
		HYGIENE PRODUCTS​
	TRANSPORTATION​
		MANUFACTURING​	180
16,600	ELECTRIFICATION​
	BIOPLASTICS​
employees in	CONSTRUCTION		million end-users
43 countries		BIOMEDICALS	globally

2 | © UPM

Our businesses

UPM Pulp	UPM Timber
A versatile range of	Certified sawn
chemical pulp for	timber for joinery,
many growing end	packaging,
uses	furniture, planing
	and construction

UPM Forest

Sourcing wood raw material for sustainable and recyclable products

UPM Energy

Carbon-free electricity generation of hydro, nuclear and thermal power

UPM Raflatac

Self-adhesive paper and film products incl. label materials, graphics solutions and removable self-adhesive products.

UPM Specialty Papers

Labelling materials, release base papers, flexible packaging papers, office and graphic papers

UPM Communication Papers

Magazine papers, newsprint and fine papers for a wide range of end uses

UPM Plywood

Plywood and veneer products for construction, vehicle flooring and LNG shipbuilding

UPM Biofuels	UPM
Wood-based	Biochemicals
renewable diesel	Glycols, lignin
and naphtha	products, renewable
	functional fillers

UPM Biomedicals

Wood-based biomedical products for clinical and life science applications

UPM Biocomposites

Composite decking materials and wood- based biocomposites

3 | © UPM

We create

Growth

a future

beyond fossils

Biofore strategy drives stakeholder value creation and our transformation as the frontrunner of bioeconomy

• We respond to megatrends and meet customers' changing needs
• Creating new markets and enabling sustainable choices

Performance

• Continuous improvement
• Agile operating model
• Corporate synergies

Innovation

• Creating new business and competitive advantage
• Replacing fossils with biomaterials

Responsibility

• Renewable & sustainable solutions
• Responsible operations and value chain

Portfolio choices

• Strategic access to sustainable renewable raw materials
• Investing in businesses with strong long-term fundamentals for growth and high barriers to entry

• Effective capital allocation with attractive returns	4 | © UPM

Spearheads for growth

• strong business platforms for growth

SPECIALTY

PACKAGING

MATERIALS

FIBRES

BIOREFINING

Communication papers	Plywood	Energy

5 | © UPM

Global strengths and opportunities

Sales

Personnel

Assets

EUR 10,460m

16,573

EUR 18,473m

Finland

Rest of Europe

Uruguay

Asia

North America

Rest of the world

Figures for 2023

6 | © UPM

UPM by business area in 2023

Sales

Comparable EBIT

Capital employed

EUR 10,460m	EUR 1,013m	EUR 16,414m
		(average)

Fibres

Energy

Raflatac

Specialty Papers

Communication Papers

Plywood

Other

7 | © UPM

Our climate commitment

WE ACT THROUGH	WE ACT THROUGH	WE ACT THROUGH
FORESTS	EMISSION REDUCTIONS	PRODUCTS
Committed to climate-positive	-65% from own CO2 emissions	Innovative products
forestry and enhancing	-30% from CO2 emissions	Scientifically verifying the climate
biodiversity
of supply chain	impact of all our products

8 | © UPM

Towards net-zero emissions

(UPM 2023)

Research partners: LUKE, SYKE, IFEU

9 | © UPM

Bioeconomy offers a sustainable alternative to fossil-based economy

Biomass use is not increasing

CO2 to carbon cycle

E-fuels and
chemicals	Biofuels and
	biochemicals
	Wood for
	energy
	Wood fibre for
	pulp and paper
	production
	Timber and
	plywood

Use of fossil resources increases CO2 amount

GtCO2/year

Use of fossils has increased

global CO2 -emissions

60

Other greenhouse gases

45

CO2 from fossil fuels

Land use and forestry

30

15

0

1851

1864

1877

1890

1903

1916

1929

1942

1955

1968

1981

1994

2007

2020

Energy from	Source: IEA, Our World in Data
fossil resources	10 | © UPM