The first quarter was strong for the Rottneros Group due to a number of positive factors. Profit after net financial items was SEK 103 million, an improvement of SEK 83 million compared with the same quarter in 2014. Currencies and the pulp market were the main drivers of the favourable earnings trend compared with the first quarter last year, but our internal improvement programme continued to deliver results to produce a substantial boost to earnings. A large portion of the improvement in earnings is attributable to increased sales and production in particular. We are also extremely pleased to see that both plants are delivering good profitability and substantial improvements in earnings.

• Profit after net financial items amounted to SEK 103 (20) million for the first quarter of 2015, our best quarterly performance in the current structure.
• Net turnover for the first quarter is SEK 454 (380) million, a 19% increase.
• Production volumes increased by 10% compared with the first quarter of 2014.
• The PIX price in USD declined during the first quarter and amounted to an average of USD 907. In Swedish kronor the price rose nine per cent compared with the fourth quarter in 2014 due to the favourable trend for the USD. Compared with the first quarter of 2014, the price increase in SEK is about 28%.
• Cash flow from operating activities amounted to SEK 64 (9) million for the first quarter of 2015 and SEK 159 million on a rolling 12-month basis, compared with SEK 104 million for the full year 2014. Interest-bearing receivables as of 31 March were SEK 116 (-25) million.

Customer demand for our grades of pulp is stable. However, we have seen some pressure on prices during the quarter, mainly driven by an increased supply. Translated into SEK, prices continue to be high thanks to the appreciation of the USD.

Several planned measures to improve availability were carried out during the autumn maintenance shutdown at our mills were carried out during the autumn maintenance shutdown at our mills, resulting in higher production volumes during the first quarter. Compared with the corresponding quarter last year, production increased by 10 per cent for the Group. Rottneros Mill was the strongest performer here, with an impressive 19 per cent increase in volume.

I am glad that the Board of Directors of Rottneros has decided to approve the first investments of approximately SEK 180 million to launch Agenda 500, which is a long-term industrial plan to increase the capacity of the Group through gradual investments. We are investing in renewing production equipment and the organisation to increase capacity and building out to ease the bottlenecks in the two mills. The total plan is about SEK 800 million for Agenda 500 in full, divided into about SEK 400 million in the medium term and SEK 400 million in the longer term. The pace of the investments will be determined by Rottneros’ ability to allocate the increased volumes in the market.

We have a strong starting position for the rest of 2015. A weakly negative price trend has been offset by the continued strong USD. Our dedicated employees are working hard to run and develop the business in order to gradually increase volumes and achieve more efficient production. I look forward to the coming year and the strategically important development steps that we have now begun to implement.

Per Lundeen

(For complete interim report see attached file)