<a id="bm-comp-a31cca3d-63db-4d66-858c-6739bbdaa977" name="bm-comp-a31cca3d-63db-4d66-858c-6739bbdaa977" class="BMCustomAnchor"></a><table><tr><td bm-component-id="a31cca3d-63db-4d66-858c-6739bbdaa977" style="vertical-align: top; width:100.000000%;"><ul><li>Miss driven by Pulp</li><li>Paper market better, but still not good enough</li><li>Outlook remains muted</li></ul></td></tr></table><a id="bm-comp-9775fbf5-4f21-4e51-9729-abc9993be672" name="bm-comp-9775fbf5-4f21-4e51-9729-abc9993be672" class="BMCustomAnchor"></a><table><tr><td bm-component-id="9775fbf5-4f21-4e51-9729-abc9993be672" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Miss driven by Pulp</h3><p>Q1 group EBITDA came in at PLN 23m, which was in line with ABGSCe PLN 23m. Paper EBITDA came in at PLN 33m, slightly below ABGSCe PLN 34m. Paper EBIT was PLN 12m vs. ABGSCe PLN 15m. Group EBIT came in at PLN -10m vs. ABGSCe of PLN -7m. Key to Q1 was unfavourable currency rate development and high Scandinavian wood prices which pressured pulp profitability, while global trade turbulences contributed to a hesitant paper market. EPS came in at PLN -0.19 vs our estimate of PLN 0.16.</p><h3 class="bm-h3">Paper market better, but still not good enough</h3><p>Paper prices fell 8.5% in '24 (-20% in '23), and the negative trend continued into '25 as prices fell -1.5% q-o-q in Q1 (-0.7% in Q4 q-o-q). Paper markets are helped by 16% supply cuts in '24-'25, but slow demand leaves the utilisation rate low at 80%. We need 2mt more cuts (10%) to reach the historical average of ~89%. Our paper price model points to prices increasing by ~5-10% in '25, but we expect demand to stay relatively flat. <font color="#000000">Arctic Paper is well-positioned, as it is a leading premium design/book paper player with a decent overall position on the cash cost curve.</font></p><h3 class="bm-h3">Outlook remains muted</h3><p>Arctic Paper expects the tough market conditions to continue through H1’25, and highlights increased focus on cost control and financial resilience. Our preliminary bridge points to a flattish Q2 for the paper business, however we will await the company call before concluding.</p></td></tr></table><a id="bm-comp-4e5085de-5324-4ff1-b1c4-0f6b2c5fadbb" name="bm-comp-4e5085de-5324-4ff1-b1c4-0f6b2c5fadbb" class="BMCustomAnchor"></a><table><tr><td bm-component-id="4e5085de-5324-4ff1-b1c4-0f6b2c5fadbb" style="vertical-align: top; width:100.000000%;"><table id="bm-img-5efe9d30-fd7c-49a3-b486-aeccb6b2d868" class="bm-img-table xslt-img-empty xslt-img-include"><tr><td class="xslt-img-caption">Deviation table</td></tr><tr><td><img bm-img-encrypt="5efe9d30-fd7c-49a3-b486-aeccb6b2d868" bm-img-original-height="245" bm-img-original-width="651" bm-img-svg="image:image_upload/87770_2636da08-a107-419a-8208-7e9792ab9a7a.svg" bm-img-width-hint="89.55%" id="bm-id-e8044f6d-c9ef-4776-bf9f-31a1a58daf94" src="https://abgsc.bluematrix.com/images/image_upload/87770_2636da08-a107-419a-8208-7e9792ab9a7a_651.png" svg="/nas/web/clients/abgsc/images/image_upload/87770_2636da08-a107-419a-8208-7e9792ab9a7a.svg" width="651" alt="" title="" /></td></tr><tr><td class="xslt-img-source">Source: ABG Sundal Collier, Company information</td></tr></table></td></tr></table>