<a id="bm-comp-2deb8f82-dc97-4e86-b85d-27493f2e9998" name="bm-comp-2deb8f82-dc97-4e86-b85d-27493f2e9998" class="BMCustomAnchor"></a><table><tr><td bm-component-id="2deb8f82-dc97-4e86-b85d-27493f2e9998" style="vertical-align: top; width:100.000000%;"><ul><li><font color="#000000">Q2 paper EBIT of PLN -32m</font></li><li><font color="#000000">Pulp prices down, while paper remains challenging</font></li><li><font color="#000000">Fair value range of SEK 15-50</font></li></ul></td></tr></table><a id="bm-comp-2fefdd70-b1d9-48c3-be80-28a45131967f" name="bm-comp-2fefdd70-b1d9-48c3-be80-28a45131967f" class="BMCustomAnchor"></a><table><tr><td bm-component-id="2fefdd70-b1d9-48c3-be80-28a45131967f" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Q2 paper EBIT of PLN -32m</h3><p><font color="#000000">Paper EBIT came in at PLN -32m (ABGSCe PLN -20m), with paper sales in line at PLN 514m but down 10% q-o-q. Group EBIT was PLN -30m vs. ABGSCe -24m. As before, the results were hit by subdued demand and higher input costs from the Middle East conflict, while the price hikes meant to offset these fell short amid intense price competition. Paper EBITDA was PLN -8m and group EBITDA PLN 9m (ABGSCe 12m), the latter lifted by improved pulp profitability on lower pulpwood prices and reduced fixed costs. Arctic Paper also strengthened its US presence via a new sales office, targeting 5-10% of paper sales over the coming years. Capex has been 'significantly reduced' and cost-saving initiatives are largely complete, set to deliver ~PLN 6m in 2026. Lower pulpwood prices should further support profitability (lag into P&L), but with demand soft and visibility limited, we forecast Q3 paper EBIT of PLN -10m.</font></p><h3 class="bm-h3">Pulp prices down, while paper remains challenging</h3><p><font color="#000000">Pulp looks to have peaked for now: Chinese integrated capacity caps the upside once prices clear cash cost (USD 605/t), and Asian HW is up 14% vs H2'25 but down 6% lately (USD 565/t). European pulp prices fell in July, following Chinese pulp futures (HW -3.5%, SW -1.2%). Wood prices are falling across Scandinavia (-15-30%) now. This effect comes with a lag into the P&L. Paper markets are helped by 6% supply cuts in '26e, but slow demand leaves utilisation <80%. We need +3mt more in cuts to reach the historical average of ~89%. Note that the UPM JV with Sappi could fix the paper market balance.</font></p><h3 class="bm-h3">Fair value range of SEK 15-50</h3><p><font color="#000000">The company is trading at an EV/CE multiple of ~0.46x, which is ~40% below its historical average. We have applied three valuation methodologies and arrive at a fair value range of SEK 15-50.</font></p></td></tr></table>