1

INTERIM REPORT JANUARY-MARCH 2011

Per Lindberg, President and CEOBertil Carlsén, CFO20 April, 2011

2

AGENDA

• Highlights

• Development by Business Area

• Financials

• Outlook

3

HIGHLIGHTS IN Q1 2011

• Strong Q1 results » Operating profit of MSEK 332, margin 13%» Top line growth of 12% vs. Q4

• Sales volume record – 369 ktonnes

• Continued strong results for packaging paper» Strong order situation

• Good results in Market Pulp» Pulp market balance remained stable

2 2792 547

0

500

1 000

1 500

2 000

2 500

3 000

Oct-Dec 2010 Jan-Mar 2011

MSE

K

4

CONTINUED INCREASE IN NET SALES & EBIT

+12%

Net sales EBIT

+2%

332326

0

50

100

150

200

250

300

350

400

Oct-Dec 2010 Jan-Mar 2011

MS

EK

5

PACKAGING & SPECIALITY PAPERKraft & Sack Paper

PACKAGING BOARDSS/C Fluting, Liner, Liquid Board

MARKET PULPNordic Bleached Softwood Kraft Pulp

BUSINESS AREAS & SEGMENTS

Note: Graph shows sales breakdown per business area for Jan-Mar 2011.

6

PACKAGING & SPECIALITY PAPERMarket situation in Q1 2011

• Continued very good order situation for the season for sack paper and slightly below Q1 2010 level for kraft paper

• Increased price level in local currency for most products vs. Q4

• Additional price increases have been announced

Building & construction

Food

Consumer

7

PACKAGING & SPECIALITY PAPERFinancials – Q1 2011 vs. Q4 2010

• Operating profit up by MSEK 9

• +24% increase in sales volume

• Price improvements and higher sales compensated for a stronger SEK and higher variable costs

Q1 2011 Q4 2010 Q1 2010 FY 2010

Net sales, MSEK 1,217 1,020 1,052 4,166

Operating profit, MSEK 140 131 96 417

Operating margin, % 12 13 9 10

0

20

40

60

80

100

120

140

160

Q1 Q2 Q3 Q4 Q1

EB

IT, M

SE

K

20112010

8

PACKAGING BOARDSMarket situation in Q1 2011

• Continued stable order situation throughout the quarter

• Increased price level in local currency for most products vs. Q4

• Additional price increases have been announced

9

PACKAGING BOARDSFinancials – Q1 2011 vs. Q4 2010

• Operating profit down by MSEK 25

• +12% increase in sales volume

• Price improvements and higher sales compensated partly for a stronger SEK and higher variable costs

Q1 2011 Q4 2010 Q1 2010 FY 2010

Net sales, MSEK 728 648 613 2,428

Operating profit, MSEK 97 122 56 271

Operating margin, % 13 19 9 11

-20

0

20

40

60

80

100

120

140

Q1 Q2 Q3 Q4 Q1

EB

IT, M

SE

K

20112010

10

MARKET PULPMarket situation in Q1 2011

• Pulp market balance remained stable

• Price level in Europe increased during Q1

» 980 USD/ton end of Q1 vs. 950 USD/ton end of Q4

• An additional price increase has been announced

» 1 010 USD/ton as of April 1, 2011

11

MARKET PULPFinancials – Q1 2011 vs. Q4 2010

• Operating profit down by MSEK 15

• Stronger SEK and increased variable costs

Q1 2011 Q4 2010 Q1 2010 FY 2010

Net sales, MSEK 436 450 384 1,731

Operating profit, MSEK 38 53 31 276

Operating margin, % 9 12 8 16

-40

-20

0

20

40

60

80

100

120

Q1 Q2 Q3 Q4 Q1

EB

IT, M

SE

K

20112010

12

Q1 IN SUM

• Strong Q1 results» Both in terms of margin and net sales

growth » Sales volume record – 369 ktonnes

• Continued strong results for packaging paper

• Product and business development continues

13

FINANCIALS

14

QUARTERLY KEY FIGURES

Q1 2011 Q4 2010 Q1 2010 vs. Q4 2010

vs. Q1 2010

Sales volume (ktonnes) 369 323 343 +14% +8%

Net sales, MSEK 2,547 2,279 2,190 +12% +16%

Operating profit, MSEK 332 326 234 +2% +42%

Operating margin 13% 14% 11% -1 p.p. +2 p.p.

Profit/share, SEK 2.28 2.19 1.52 +4% +50%

Net debt/equity ratio 0.05 0.03 0.24 -0.02 +0.19

15

EBIT BRIDGE Q1 2011 vs. Q4 2010

* Includes product mix.

332326

+51

+46

-75

-78

+49 +13

0

50

100

150

200

250

300

350

400

450

EBIT Q4 2010

Sales &productionvolumes*

Selling prices(in respective

salescurrency)

Effects ofexchange rate

fluctuations,incl. hedging

Change invariable costs

Change infixed costs

Change indepreciation

EBIT Q1 2011

MS

EK

-2%

-1%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

11%

12%

13%

14%

FY 06 FY 07 FY 08 FY 09 FY 10

EB

IT m

argi

n, ro

lling

12 m

onth

s (%

)

16

CONTINUED STRONG MARGIN TREND

Financial target

17

1) Minus equals increase in net debt

CASH FLOW

MSEK Q1 2011 Q1 2010Operating surplus, etc 481 379

Change in working capital, etc. -301 -88

Net financial items, taxes, etc. -181 -30

Cash flow from operating activities -1 261

Current net investments -82 -50

Business combinations - -

Operating cash flow -83 211

Dividend - -

Other items, not affecting cash flow -6 -35

Change in net debt 1) -89 176

18

WORKING CAPITAL KEY RATIOSDSO Overdue WC as % of quarterly sales

0

10

20

30

40

50

60

70

0901

3109

0430

0907

3109

1031

1001

3110

0430

1007

3110

1031

1101

31

DSO

day

s

0,0

1,0

2,0

3,0

4,0

5,0

6,0

0901

3109

0430

0907

3109

1031

1001

3110

0430

1007

3110

1031

1101

31

% o

f tot

al re

ceiv

able

s

0%

10%

20%

30%

40%

50%

60%

70%

0903

0906

0909

0912

1003

1006

1009

1012

1103

Wor

king

cap

ital (

excl

. IA

S)/q

uarte

ly n

et tu

rnov

er

19

8090

100110120130140150160

2004 Q32005

Q22006

Q12007

Q42007

Q32008

Q22009

Q12010

Q42010

MARKET PRICES AFFECTING RESULT

550600650700750800850900950

1 000

2004 Q32005

Q22006

Q12007

Q42007

Q32008

Q22009

Q12010

Q42010

9497

100103106109112115118

2004 Q3 2005

Q22006

Q12007

Q42007

Q32008

Q22009

Q12010

Q42010

80

120

160

200

240

280

2004 Q32005

Q22006

Q12007

Q42007

Q32008

Q22009

Q12010

Q42010

Electricity index (Sweden*) Wood price index

Market Pulp (USD/t) TCW indexSource: Nordpool. *Price area Sweden

Source: Riksbanken

Source: Billerud

Note: Average price for the quarter

20

CURRENCY EFFECT OF A STRONGER SEK

How do we manage?• Price increases

• Hedging in the short-run

• Customer and market mix to some extent

-3%

-4%

-4%

vs. Q4 2010

10.39

6.48

8.87

Average rateQ1 2011

Average rateQ4 2010

Spot rate17 Apr 2011

vs. 17 Apr 2011

EUR 9.22 8.96 -1%

USD 6.78 6.26 +4%

GBP 10.72 10.21 +2%

21

CURRENCY SITUATION

Apr-Jun 2011

Jul-Sep 2011

Oct-Dec 2011

Jan-Mar 2012

Total 12 months

Average hedged currency

rates(hedged net

flows)

Average hedged currency

rates(hedged net

flows)

Average hedged currency

rates(hedged net

flows)

Average hedged currency

rates(hedged net

flows)

Average hedged currency

rates(hedged net

flows)

9.23 9.19 9.41 9.48 9.31

(85%) (51%) (49%) (47%) (58%)

7.12 7.50 6.82 6.60 7.14

(88%) (61%) (35%) (16%) (50%)

10.79 10.77 10.74 10.64 10.76

(86%) (54%) (42%) (20%) (51%)

• Profit effect of net flow hedging MSEK 99 for Q1 2011 (117)

• Market value of outstanding contracts not relating to accounts receivables was MSEK 132 (as of 31/3-11)

• Hedge level 12 months forward:

Note: Data in table and graph are as of 31 March 2011

51%

50%

58%

GBP

USD

EUR

22

OUTLOOK

23

OUTLOOK FY 2011

• The order situation remains good or very good in most of Billerud’spackaging paper areas. This provides conditions for a stable development within Billerud’s packaging paper and packaging paper solutions segments.

• Price increases announced in the first quarter of 2011 are expected to have an impact in the coming quarters.

• The effects of a stronger SEK will be largely compensated by currency hedges.

24

Q&A