<a id="bm-comp-b870c38a-0eaa-402e-95b4-6f14e79f98e8" name="bm-comp-b870c38a-0eaa-402e-95b4-6f14e79f98e8" class="BMCustomAnchor"></a><table><tr><td bm-component-id="b870c38a-0eaa-402e-95b4-6f14e79f98e8" style="vertical-align: top; width:100.000000%;"><ul><li>Q2e: we expect Paper EBIT of ~PLN -20m</li><li><font color="#000000">Pulp costs up following Suzano hikes</font></li><li><font color="#000000">Fair value range of SEK 15-50</font></li></ul></td></tr></table><a id="bm-comp-9860a1b8-82d4-4419-8002-00ead719ef0d" name="bm-comp-9860a1b8-82d4-4419-8002-00ead719ef0d" class="BMCustomAnchor"></a><table><tr><td bm-component-id="9860a1b8-82d4-4419-8002-00ead719ef0d" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Q2e Paper EBIT of ~PLN -20m</h3><p>We expect Q2 to be another challenging quarter, with negative volume effects and higher costs q-o-q. Arctic Paper announced price hikes in April and June of 8-10% and 4-8% respectively. We estimate that the somewhat strong Q1 volumes were driven by short-term effects ahead of the price hikes, and that Q2 will see a reversal of the positive effects. Furthermore, our trackers indicate that the increases in selling prices were insufficient to offset higher pulp costs. Coupled with headwinds from the Middle East conflict – i.e. higher logistics and chemical costs – we see pressure on Q2 (note the large sensitivities to input costs, hence the large estimate revisions). Our bridge now points to Q2 Paper EBIT of ~PLN -20m, down from PLN -2m in Q1 and FY Paper EBITDA of ~74m. Q3 should remain difficult, with slow demand and still high input costs. Q4 should be helped by energy compensation.</p><h3 class="bm-h3">Pulp costs up following Suzano hikes</h3><p>Paper markets remain structurally oversupplied at ~75% utilisation, and while the ~4% supply cuts for '26 help, the market still needs ~3mt of capacity cuts to reach historical utilisation. The pulp market faced headwinds in '25, but key drivers are now moving in the right direction. Hardwood prices are up ~20% (40% in EU) following Suzano’s +30% hikes. This is a headwind for Arctic but a tailwind for Rottneros. We note, however, that Rottneros' exposure is mainly to softwood and CTMP, which have lagged hardwood. Softwood is slightly up, and with lower wood costs, Rottneros could improve q-o-q.</p><h3 class="bm-h3">Fair value range of SEK 15-50</h3><p>The company is trading at an EV/CE multiple of ~0.45x, which is ~40% below its historical average. We have applied three valuation methodologies and arrive at a fair value range of SEK 15-50.</p></td></tr></table>