Holmen

Annual Report • Feb 9, 2015

Holmen's year-end report 2014

		Quarter	Full year
SEKm	4-14	3-14	4-13	2014	2013
Net turnover	4 011	3 956	3 938	15 994	16 231
Operating profit excl. items affecting comparability	472	522	338	1 734	1 209
Operating profit	22	522	338	1 284	1 069
Profit after tax	-4	385	230	907	711
Earnings per share, SEK	-0.1	4.6	2.7	10.8	8.5
Return on equity, %	0.0	7.4	4.5	4.3	3.4
Cash flow before investing activities	414	738	444	2 176	2 011
Debt/equity ratio	0.28	0.29	0.29	0.28	0.29

• Operating profit, excluding items affecting comparability, for 2014 was SEK 1 734 million (2013: 1 209). The improvement in profit is due to higher prices for printing paper and sawn timber, a weaker Swedish krona and reduced production costs for paperboard.
• Operating profit for the fourth quarter, excluding items affecting comparability, amounted to SEK 472 million, which was SEK 50 million lower than in the third quarter owing mainly to seasonally higher staff and energy costs.
• Operating profit for 2014 after items affecting comparability amounted to SEK 1 284 million (1 069). In the fourth quarter, an impairment of SEK 450 million was recorded for Braviken Sawmill, which is reported as an item affecting comparability.
• Profit after tax amounted to SEK 907 million (711), which corresponds to earnings per share of SEK 10.8 (8.5). Excluding items affecting comparability, profit after tax amounted to SEK 1 258 million (820) and earnings per share was SEK 15.0 (9.8).

The Board proposes a dividend of SEK 10 (9) per share.

0

5

10

15

Holmen Paper		Quarter		Full year
SEKm	4-14	3-14	4-13	2014	2013
Net sales	1 548	1 637	1 674	6 247	7 148
Operating costs	-1 351	-1 445	-1 559	-5 522	-6 720
EBITDA	197	192	115	725	429
Depreciation and amortisation according to plan	-147	-147	-185	-584	-738
Operating profit excl. items affecting comp.	51	45	-70	141	-309
Items affecting comparability*	-	-	-	-	-140
Operating profit	51	45	-70	141	-449
Investments	93	47	-42	331	85
Operating capital	4 666	4 707	4 810	4 666	4 810
EBITDA margin, %**	13	12	7	12	6
Operating margin, %**	3	3	-4	2	-4
Production, '000 tonnes	343	320	354	1 325	1 545
Deliveries, '000 tonnes	322	341	363	1 305	1 574

* Items affecting comparability refers to an impairment loss and restructuring costs of SEKm -140 in Q1 2013

** Excluding items affecting comparability

Demand for printing paper in Europe decreased by 5 per cent during January–November 2014 compared to the same period last year. Price negotiations for 2015 are expected to result in lower prices.

Holmen Paper's deliveries amounted to 1 305 000 tonnes in 2014, which was approximately 15 per cent lower than last year as a result of the closure of two paper machines in autumn 2013. The strategic product segments MF Magazine and book paper accounted for just over half of deliveries.

Holmen Paper's operating profit for 2014 was SEK 141 million (-309), excluding items affecting comparability. The improvement in profit is due to slightly higher selling prices, a weaker Swedish krona and reduced costs. Depreciation has decreased following the implementation of closures. Compared with the third quarter, profit increased by SEK 6 million to SEK 51 million. Production was good, but staff and energy costs increased seasonally. Operating profit in the third quarter was negatively affected by maintenance shutdowns.

In the first quarter of 2015, one of the newsprint machines at Braviken Paper Mill will be rebuilt to enable further growth in magazine paper. The rebuilding will result in a production shutdown of approximately 3 weeks. In the spring, the mill will switch over fully to virgin fibre-based production and the last recovered paper production line will be closed. Costs and production losses associated with these measures are estimated to have a negative impact of approximately SEK 70 million on operating profit for the first quarter.

Iggesund Paperboard		Quarter	Full year
SEKm	4-14	3-14	4-13	2014	2013
Net sales	1 320	1 310	1 141	5 113	4 618
Operating costs	-968	-924	-889	-3 951	-3 740
EBITDA	352	387	252	1 161	878
Depreciation and amortisation according to plan	-123	-124	-116	-487	-445
Operating profit	229	263	136	674	433
Investments	37	37	149	288	660
Operating capital	6 790	6 820	6 863	6 790	6 863
EBITDA margin, %	27	30	22	23	19
Operating margin, %	17	20	12	13	9
Return on operating capital, %	13	15	8	10	7
Production, paperboard, '000 tonnes	127	133	115	500	478
Deliveries, paperboard, '000 tonnes	122	125	112	493	469

The market for SBB and FBB was stable during the quarter. Deliveries to Europe from European producers were unchanged in 2014 compared to 2013.

Iggesund Paperboard's deliveries for 2014 amounted to 493 000 tonnes, which was 24 000 tonnes higher than in 2013.

Operating profit for 2014 was SEK 674 million (433). The improvement in profit is mainly due to reduced production costs, but also higher deliveries and a weaker Swedish krona.

Compared with the third quarter, operating profit decreased by SEK 34 million to SEK 229 million. Production remained good, but costs increased seasonally.

A major maintenance shutdown will take place at the mill in Workington in the first quarter of 2015. The shutdown is expected to have a negative effect of SEK 50 million as a result of production losses and increased costs.

In December a decision was taken to invest SEK 530 million to increase paperboard production at Workington by 20 000 tonnes and pulp production at Iggesund Mill by 50 000 tonnes. These investments, to be carried out in 2015–2016, will also improve product quality and production stability.

Year-end report 2014

Holmen Timber		Quarter	Full year
SEKm	4-14	3-14	4-13	2014	2013
Net sales	315	313	322	1 352	1 175
Operating costs	-293	-265	-297	-1 192	-1 131
EBITDA	23	48	25	160	45
Depreciation and amortisation according to plan	-31	-31	-30	-123	-119
Operating profit excl. items affecting comp.	-8	16	-5	37	-75
Items affecting comparability*	-450	-	-	-450	-
Operating profit	-458	16	-5	-413	-75
Investments	32	8	7	55	21
Operating capital	901	1 323	1 361	901	1 361
EBITDA margin, %**	7	15	8	12	4
Operating margin, %**	-3	5	-1	3	-6
Production, '000 m3	186	172	203	742	710
Deliveries, '000 m3	169	165	186	725	686

* Items affecting comparability refers to an impairment loss of SEKm -450 in Q4 2014

** Excluding items affecting comparability

The market for sawn timber deteriorated in the autumn as a result of increased supply. Selling prices decreased in the fourth quarter.

Holmen Timber increased productivity at both sawmills and delivered 725 000 cubic metres in 2014, which was 6 per cent higher than in 2013.

Operating profit for 2014 was SEK 37 million (-75), excluding items affecting comparability. The improvement in profit is due to higher selling prices, a weaker Swedish krona and increased deliveries. The improvement was partly offset by higher raw material prices in Southern Sweden.

Compared with the third quarter, operating profit decreased by SEK 24 million to SEK –8 million, excluding items affecting comparability. The decrease in operating profit is due to lower selling prices, higher raw material costs and seasonally higher staff costs.

Production at Braviken Sawmill runs well, but profitability is weak owing to high raw material prices in Southern Sweden. In the fourth quarter, an impairment of SEK 450 million was recorded on the sawmill's non-current assets, which reduced operating profit.

Holmen Skog		Quarter	Full year
SEKm	4-14	3-14	4-13	2014	2013
Net sales	1 461	1 250	1 376	5 641	5 694
of which from own forests	343	311	353	1 314	1 403
Operating costs	-1 299	-1 158	-1 189	-5 077	-5 000
Depreciation and amortisation according to plan	-9	-7	-9	-29	-34
Earnings from operations	153	86	178	535	660
Change in value of forests	27	114	71	282	264
Operating profit	180	200	249	817	924
Investments	13	47	31	86	54
Operating capital	17 340	17 148	16 813	17 340	16 813
Return on operating capital, %	4	5	6	5	6
Harvesting company forests, '000 m3	849	788	882	3 297	3 465

Demand for timber in Sweden was high in the fourth quarter, while demand for pulpwood was normal. Selling prices were largely unchanged. Timber prices remain significantly higher in Southern Sweden than in other parts of the country.

Holmen Skog's earnings from operations for 2014 amounted to SEK 535 million (660). The decrease in profit is due to high costs for handling storm fellings and a decrease in harvesting volumes from a high level. Operating profit, which includes a change in value of SEK 282 million, totalled SEK 817 million (924).

Compared with the third quarter, earnings from operations rose by SEK 67 million to SEK 153 million, as a result of seasonally lower silviculture costs, higher harvesting and lower costs for handling storm fellings. The change in value, which amounted to SEK 27 million, was lower than normal due to a slight downward adjustment of future harvesting owing to the storms of last winter.

5

Holmen Energi	Quarter			Full year
SEKm	4-14	3-14	4-13	2014	2013
Net sales	358	319	407	1 408	1 648
of which from own hydro power	91	71	117	388	450
Operating costs	-303	-286	-336	-1 175	-1 257
Depreciation and amortisation according to plan	-6	-5	-5	-21	-20
Operating profit	50	28	65	212	371
Investments	5	11	10	32	46
Operating capital	3 401	3 393	3 357	3 401	3 357
Return on operating capital, %	6	3	8	6	11
Production of company hydro pow er, GWh	213	198	262	1 048	1 008

Holmen Energi's operating profit in 2014 was SEK 212 million (371). The decrease in profit is due to the impact of lower electricity prices and the fact that the previous year's earnings included SEK +102 million from the sale of a stake in the Varsvik wind farm. Production was slightly higher than in 2013, but was 6 per cent lower than in a normal year.

Compared with the third quarter, operating profit increased by SEK 22 million to SEK 50 million owing to higher prices.

The levels in Holmen's water storage reservoirs were back to a normal level at the end of the quarter as a result of production being held back in the quarter.

Net sales own hydro power

Net financial items and financing

Net financial items for 2014 totalled SEK -147 million (-198). Borrowing costs fell to an average of 2.3 per cent (3.1).

Cash flow from operating activities totalled SEK 2 176 million. Cash flow from investing activities was SEK -834 million. SEK 756 million in dividends was paid in the second quarter.

The Group's net financial debt fell by SEK 209 million to SEK 5 907 million in 2014. At the end of 2014 the debt/equity ratio was 0.28 and the equity/assets ratio 58 per cent. Financial liabilities including pension provisions totalled SEK 6 156 million, SEK 3 269 million of which was current liabilities. Cash, cash equivalents and financial receivables totalled SEK 249 million. The Group has unused long-term contractually agreed credit facilities of SEK 4 358 million, maturing in 2017-2019.

Tax

Recognised tax for 2014 amounted to SEK -230 million (-160). Recognised tax as a proportion of profit before tax was 20 (18) per cent.

Equity

In 2014, the Group's equity increased by SEK 114 million to SEK 20 969 million. Profit for the period totalled SEK 907 million. Dividend of SEK 756 million was paid. In addition, other comprehensive income totalled SEK -37 million.

. Hedging exchange rates and electricity prices

The Group hedges parts of future estimated net flows in foreign currencies. Operating profit for 2014 includes currency hedges of SEK -116 million (1). The market value of currency hedges not yet recognised as income amounted to SEK -94 million at the end of the year.

The Swedish krona weakened significantly over the year, which had a positive effect of SEK 300 million on consolidated operating profit compared with 2013. Profit for the fourth quarter was positively affected by SEK 30 million compared with the third quarter owing to the weaker krona. For 2015, 90 per cent of expected flows in EUR/SEK are hedged at an average of 9.25. For other currencies, approximately 4 months of flows are hedged. Calculated on the basis of existing hedges and the exchange rates at the turn of 2014/2015 (euro: 9.5, US dollar: 7.8 and sterling: 12.1), exchange rate differences are expected to have a positive impact of approximately SEK 300 million on consolidated operating profit for 2015 compared with 2014. Calculated in a corresponding way, the first quarter of 2015 is expected to be positively affected by approximately SEK 20 million compared with the fourth quarter of 2014.

Prices for the Group's estimated net consumption of electricity in Sweden for 2015 are fully hedged. For 2016– 2018, 60 per cent has been hedged while for 2019–2021 40 per cent has been hedged.

Investments

Cash flow from investing activities in 2014 was SEK -834 million (-869). Scheduled depreciation and amortisation totalled SEK 1 265 million (1 370).

Personnel

The average number of employees (full-time equivalents) in the Group was 3 359 (3 718). The reduction is mainly attributable to cutbacks in Holmen Paper and Iggesund Paperboard.

Share buy-backs

At the 2014 AGM, the Board's authorisation to purchase up to 10 per cent of the company's shares was renewed. No buy-backs took place during the period. The company owns 0.9 per cent of all shares outstanding.

Dividend

The Board proposes that the AGM to be held on 16 April 2015 approve a dividend of SEK 10 (9) per share, corresponding to 4.0 per cent of equity. The dividend proposal is based on an appraisal of the Group's profitability, future investment plans and financial position. The proposal record date for the dividend is 20 April 2014.

Material risks and uncertainties

The Group's and the parent company's material risks and uncertainties relate primarily to changes in demand and the prices of its products, the cost of key input goods, and changes in exchange rates. For a more detailed description of material risks and uncertainties see Holmen's annual report for 2013, pages 32–35 and note 26.

Disputes

The Spanish competition authority has carried out an extensive investigation into the country's waste and recycling industry, and in January 2015 ordered a very large number of companies to pay an administrative fine. Holmen's Spanish subsidiary is among these companies and has been ordered to pay EUR 4.8 million. This is because the competition authority claims that there was anti-competitive cooperation over the collection of paper and paperboard in Madrid. Holmen's Spanish subsidiary will appeal the decision.

Transaction with related parties

There were no transactions between Holmen and related parties that had a significant effect on the Company's financial position and performance.

Accounting policies

The report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting, the Swedish Annual Accounts Act and the Swedish Securities Market Act. For the parent company the report has been prepared in accordance with the Swedish Annual Accounts Act and the Swedish Securities Market Act, which complies with Recommendation RFR 2 Accounting for Legal Entities. The accounting policies of the Parent Company and the Group remain unchanged compared to the most recently published annual report, with the exception of the new IFRS 10-12. The change have not resulted in any effect on amounts or information in this year-end report. The figures in tables are rounded off.

Stockholm, 9 February 2015 Holmen AB (publ.)

Henrik Sjölund President and CEO

The report has not been reviewed by the company's auditors.

For further information please contact:

Henrik Sjölund, President and CEO, tel. +46 8 666 21 05 Anders Jernhall, CFO, tel. +46 8 666 21 22 Ingela Carlsson, Communications Director, tel. +46 70 212 97 12

		Quarter		Full year
Income statement, SEKm	4-14	3-14	4-13	2014	2013
Net sales	4 011	3 956	3 938	15 994	16 231
Other operating income	294	267	286	1 021	984
Change in inventories	156	-21	62	83	54
Raw materials and consumables	-2 237	-2 123	-2 197	-8 713	-9 150
Staff costs	-587	-522	-591	-2 268	-2 350
Other operating costs	-885	-834	-894	-3 393	-3 512
Depreciation and amortisation according to plan	-320	-319	-349	-1 265	-1 370
Impairment losses	-450	-	14	-450	-86
Change in value of biological assets	27	114	71	282	264
Profit from investments in associates and joint ventures	12	4	-3	-7	3
Operating profit	22	522	338	1 284	1 069
Finance income	-2	1	2	1	8
Finance costs	-39	-35	-44	-149	-205
Profit before tax	-18	488	295	1 137	871
Tax	14	-103	-65	-230	-160
Profit for the period	-4	385	230	907	711
Earnings per share, SEK	-0.1	4.6	2.5	10.8	8.5
Operating margin, % *	11.8	13.2	8.3	10.8	7.4
Return on capital employed, % *	7.0	7.7	5.0	6.4	4.5
Return on equity, %	0.0	7.4	4.5	4.3	3.4
* Excl. items affecting comparability.
		Quarter		Full year
Statement of comprehensive income, SEKm	4-14	3-14	4-13	2014	2013
Profit for the period	-4	385	230	907	711
Other comprehensive income
Revaluations of defined benefit pension plans	-53	-143	26	-170	72
Tax attributable to items that w ill not be reclassifed to profit for the period	10	29	-4	34	-15
Items that will not be reclassifed to profit for the period	-43	-115	22	-137	58
Cash flow hedging	-132	15	-48	-226	-64
Translation difference on foreign operation	123	46	106	355	109
Hedging of currency risk in foreign operation	-52	-3	-28	-101	-39
Tax attributable to items that w ill be reclassifed to profit for the period	40	-2	17	72	23
Items that will be reclassifed to profit for the period	-20	54	47	100	28
Total other comprehensive income after tax	-63	-60	69	-37	86
Total comprehensive income	-67	325	299	870	797

	Full year
Change in equity, SEKm		2013
Opening equity	20 854	20 813
Profit for the period	907	711
Other comprehensive income	-37	86
Total comprehensive income	870	797
Dividends paid	-756	-756
Closing equity	20 969	20 854

Share structure
		Votes No. of shares	No. of votes Quota value	SEKm
A-share	10	22 623 234	226 232 340	50 1 131.2
B-share	1		62 132 928 62 132 928	50 3 106.6
Total number of shares		84 756 162	288 365 268	4 237.8
Holding of ow n B-shares bought back		-760 000	-760 000
Total number of shares in issue		83 996 162	287 605 268

	2014	2014	2013
Balance sheet, SEKm	31 December	30 September	31 December
Non-current assets
Intangible non-current assets	114	109	59
Property, plant and equipment	11 265	11 779	12 104
Biological assets	16 867	16 825	16 517
Investments in associates and joint ventures	1 970	1 948	1 961
Other shares and participating interests	4	9	9
Non-current financial receivables	40	34	28
Deferred tax assets	1	2	2
Total non-current assets	30 261	30 705	30 680
Current assets
Inventories	3 198	2 885	3 140
Trade receivables	2 328	2 304	2 103
Current tax receivable	44	49	106
Other operating receivables	394	416	425
Current financial receivables	22	22	24
Cash and cash equivalents	187	120	275
Total current assets	6 172	5 796	6 074
Total assets	36 434	36 502	36 753
Equity	20 969	21 036	20 854
Non-current liabilities
Non-current financial liabilities	2 488	2 473	2 734
Pension provisions	400	338	238
Other provisions	533	552	552
Deferred tax liabilities	5 480	5 653	5 804
Total non-current liabilities	8 901	9 016	9 328
Current liabilities
Current financial liabilities	3 269	3 385	3 470
Trade payables	1 882	1 882	2 007
Current tax liability	248	176	28
Provisions	69	52	64
Other operating liabilities	1 096	955	1 002
Total current liabilities	6 564	6 450	6 571
Total liabilities	15 465	15 466	15 899
Total equity and liabilities	36 434	36 501	36 753
Debt/equity ratio, times	0.28	0.29	0.29
Equity/assets ratio, %	57.6	56.5	56.7
Operating capital	32 354	32 692	32 772
Capital employed	26 876	27 056	26 970
Net financial debt	5 907	6 020	6 116
Pledged collateral	149	145	142
Contingent liabilities	118	115	113

	Recognised value		Fair value
Financial instruments, SEKm	2014 2013		2014	2013
	31 December	31 December	31 December	31 December
Assets at fair value	18	32	18	32
Assets at acquisition cost	2 575	2 428	2 572	2 420
Liabilities at fair value	433	156	433	156
Liabilities at acquisition cost	7 491	8 167	7 497	8 202

Holmen measures financial instruments at fair value or acquisition cost in the balance sheet depending on classification. In addition to items in net financial debt, with the exception of the pension liability, financial instruments cover trade receivables and trade payables. Financial instruments measured at fair value in the balance sheet belong to measurement level 2 pursuant to IFRS 7.

All of the Group's derivatives are covered by ISDA or FEMA agreements, which entails a right to offset assets and liabilities in relation to the same counterparty in the case of a credit event. Assets and liabilities are not offset in the report. Recognised derivatives totalled SEK 18 million on the asset side and SEK 433 million on the liabilities side.

		Quarter		Full year
Cash flow analysis, SEKm	4-14	3-14	4-13	2014	2013
Operating activities
Profit before tax	-18	488	295	1 137	871
Adjustments for non-cash items *	755	197	178	1 448	1 056
Paid income taxes	-52	-51	41	-191	210
Cash flow from operating activities
before changes in working capital	684	634	515	2 394	2 138
Cash flow from changes in working capital
Change in inventories	-290	76	-165	-24	93
Change in trade receivables and other operating receivables	34	75	324	-111	173
Change in trade payables and other operating liabilities	-14	-46	-231	-82	-394
Cash flow from operating activities	414	738	444	2 176	2 011
Investing activities
Acquisition of non-current assets	-189	-153	-330	-830	-1 098
Disposal of non-current assets	8	3	132	14	226
Change in non-current financial receivables	-6	3	2	-19	3
Cash flow from investing activities	-187	-148	-196	-834	-869
Financing activities
Change in financial liabilities and current financial receivables	-162	-591	-237	-678	-419
Dividends paid to the shareholders of the parent company	-	-	-	-756	-756
Cash flow from financing activities	-162	-591	-237	-1 434	-1 175
Cash flow for the period	65	0	10	-92	-33
Opening cash and cash equivalents	120	120	264	275	308
Exchange difference in cash and cash equivalents	2	1	1	4	1
Closing cash and cash equivalents	187	120	275	187	275

		Quarter		Full year
Change in net financial debt, SEKm	4-14	3-14	4-13	2014	2013
Opening net financial debt	-6 020	-6 429	-6 402	-6 116	-6 590
Cash flow from operating activities	414	738	444	2 176	2 011
Cash flow from investing activities (excl financial
receivables)	-181	-151	-198	-816	-872
Dividends paid	-	-	-	-756	-756
Revaluations of defined benefit pension plans	-55	-143	25	-173	70
Foreign exchange effects and changes in fair value	-66	-35	16	-223	21
Closing net financial debt	-5 907	-6 020	-6 116	-5 907	-6 116

* The adjustments consist primarily of depreciation according to plan, impairment losses, change in value of biological assets, change in provisions, interests in earnings of associated companies, currency effects and revaluations of financial instruments as well as capital gains/losses on sale of fixed assets.

The Parent company

		Quarter		Full year
Income statement, SEKm	4-14	3-14	4-13	2014	2013
Operating income	4 016	3 590	3 674	15 090	15 163
Operating costs	-3 434	-3 351	-3 637	-13 929	-14 746
Operating profit	582	239	36	1 161	417
Net financial items	-79	-29	-61	-26	-212
Profit after net financial items	504	209	-25	1 135	204
Appropriations	338	324	525	1 219	824
Profit before tax	842	533	500	2 353	1 028
Tax	-189	-119	-110	-483	-201
Profit for the period	653	414	390	1 870	828
		Quarter			Full year
Statement of comprehensive income, SEKm	4-14	3-14	4-13	2014	2013
Profit for the period	653	414	390	1 870	828
Other comprehensive income
Cash flow hedging	-130	21	-134	-155	-23
Tax attributable to other comprehensive income	29	-5	30	34	5
Items that will be reclassifed to profit for the period	-102	16	-105	-121	-18
Total comprehensive income	551	430	285	1 749	810

	2014	2014	2013
Balance sheet, SEKm	31 December		30 September 31 December
Non-current assets	18 396	17 809	17 814
Current assets	4 793	4 509	4 764
Total assets	23 188	22 318	22 578
Restricted equity	5 915	5 915	5 915
Non-restricted equity	4 561	4 010	3 568
Untaxed reserves	2 330	2 196	1 771
Provisions	1 271	1 214	1 274
Liabilities	9 111	8 983	10 051
Total equity and liabilities	23 188	22 318	22 578
Pledged collateral	149	145	142
Contingent liabilities	95	95	93

Sales to Group companies in 2014 accounted for SEK 113 million (95) of operating income.

Net financial items include the result from hedging equity in foreign subsidiaries totalling SEK -101 million (-39).

Appropriations include Group contributions of SEK 1 777 million (531).

The parent company's investments in property, plant and equipment and intangible non-current assets totalled SEK 365 million (15).

	2014				2013				Full year
Quarterly figures, SEKm	Q4	Q3	Q2	Q1	Q4	Q3	Q2	Q1	2014	2013
Income statement
Net sales	4 011	3 956	3 946	4 081	3 938	3 939	4 197	4 158	15 994	16 231
Operating costs	-3 258	-3 233	-3 357	-3 422	-3 320	-3 356	-3 611	-3 632	-13 270 -13 919
Profit from investments in associates and joint ventures	12	4	-16	-7	-3	-5	2	9	-7	3
Depreciation and amortisation according to plan	-320	-319	-314	-312	-349	-347	-342	-333	-1 265	-1 370
Change in value of forests	27	114	92	49	71	95	62	36	282	264
Items affecting comparability*	-450	-	-	-	-	-	-	-140	-450	-140
Operating profit	22	522	351	389	338	326	307	98	1 284	1 069
Net financial items	-40	-34	-36	-37	-42	-59	-50	-45	-147	-198
Profit before tax	-18	488	315	352	295	266	257	53	1 137	871
Tax	14	-103	-66	-75	-65	-59	-25	-11	-230	-160
Profit for the period	-4	385	250	276	230	207	232	42	907	711
Earnings per share, SEK	-0.1	4.6	3.0	3.3	2.7	2.5	2.8	0.5	10.8	8.5
Net sales
Holmen Paper	1 548	1 637	1 490	1 572	1 674	1 817	1 879	1 778	6 247	7 148
Iggesund Paperboard	1 320	1 310	1 237	1 246	1 141	1 188	1 143	1 146	5 113	4 618
Holmen Timber	315	313	367	357	322	264	319	271	1 352	1 175
Holmen Skog	1 461	1 250	1 435	1 494	1 376	1 239	1 485	1 594	5 641	5 694
Holmen Energi	358	319	328	402	407	358	385	497	1 408	1 648
Elimination of intra-group net sales	-992	-874	-911	-990	-982	-927	-1 015	-1 127	-3 767	-4 051
Group	4 011	3 956	3 946	4 081	3 938	3 939	4 197	4 158	15 994	16 231
Operating profit/loss by business area**
Holmen Paper	51	45	40	6	-70	-48	-77	-114	141	-309
Iggesund Paperboard	229	263	86	97	136	192	45	60	674	433
Holmen Timber	-8	16	18	10	-5	-20	-15	-35	37	-75
Holmen Skog	180	200	213	224	249	203	240	232	817	924
Holmen Energi	50	28	37	96	65	34	145	127	212	371
Group-w ide	-29	-30	-43	-44	-38	-35	-30	-33	-146	-136
Group	472	522	351	389	338	326	307	238	1 734	1 209
Operating margin, % **
Holmen Paper	3.3	2.8	2.7	0.4	-4.2	-2.6	-4.1	-6.4	2.3	-4.3
Iggesund Paperboard	17.3	20.1	6.9	7.8	11.9	16.2	3.9	5.2	13.2	9.4
Holmen Timber	-2.5	5.2	5.0	2.9	-1.4	-7.6	-4.8	-12.8	2.7	-6.3
Group	11.8	13.2	8.9	9.5	8.6	8.3	7.3	5.7	10.8	7.4
EBITDA by business area**
Holmen Paper	197	192	186	151	115	137	107	70	725	429
Iggesund Paperboard	352	387	206	216	252	309	157	160	1 161	878
Holmen Timber	23	48	49	41	25	10	14	-3	160	45
Holmen Skog	162	93	128	181	187	116	186	204	563	694
Holmen Energi	56	33	42	101	71	38	150	132	233	391
Group-w ide	-24	-25	-38	-38	-34	-32	-26	-29	-126	-121
Group	765	727	573	652	616	578	587	535	2 717	2 315
Return on operating capital, % **
Holmen Paper	4.3	3.7	3.2	0.5	-5.7	-3.8	-5.9	-8.3	2.9	-6.0
Iggesund Paperboard	13.4	15.3	5.0	5.6	8.0	11.6	2.8	3.8	9.8	6.6
Holmen Timber	-2.9	4.9	5.3	3.0	-1.4	-5.7	-4.3	-9.7	2.8	-5.3
Holmen Skog	4.2	4.7	5.0	5.3	5.9	4.9	5.8	5.6	4.8	5.6
Holmen Energi	5.9	3.3	4.5	11.5	7.8	4.0	17.5	15.7	6.3	11.2
Group	5.8	6.4	4.3	4.8	4.1	4.0	3.7	2.9	5.3	3.7
Key indicators
Return on capital employed, % **	7.0	7.7	5.2	5.8	5.0	4.8	4.5	3.5	6.4	4.5
Return on equity, %	0.0	7.4	4.8	5.3	4.5	4.1	4.5	0.8	4.3	3.4
Deliveries
Printing paper, '000 tonnes	322	341	311	331	363	400	423	388	1 305	1 574
Paperboard, '000 tonnes	122	125	122	124	112	120	119	119	493	469
Saw n timber, '000 m³	169	165	196	195	186	148	189	163	725	686
Harvesting company forests, '000 m³	849	788	871	789	882	864	894	826	3 297	3 465
Production of company hydro pow er, GWh	213	198	269	368	262	188	195	363	1 048	1 008

* Items affecting comparability in Q4 2014 refers to an impairment loss on non-current assets. Q1 2013 refers to an impairment loss on non-current assets and restructuring costs.

** Excl. items affecting comparability.

Full year review, SEKm	2014	2013	2012	2011	2010	2009	2008	2007	2006	2005
Income statement
Net sales	15 994	16 231	17 852	18 656	17 581	18 071	19 334	19 159	18 592	16 319
Operating costs	-13 270	-13 919	-15 224	-15 501	-15 077	-15 191	-16 614	-15 637	-15 069	-13 287
Profit from investments in associates and joint ventures	-7	3	47	84	28	45	50	12	11	20
Depreciation and amortisation according to plan	-1 265	-1 370	-1 313	-1 260	-1 251	-1 320	-1 343	-1 337	-1 346	-1 167
Change in value of forests	282	264	350	-	52	16	-16	89	115	82
Items affecting comparability*	-450 1 284	-140 1 069	-193 1 520	3 593 5 573	264	-	-361	557	-	-
Operating profit					1 596	1 620	1 051	2 843	2 303	1 967
Net financial items	-147	-198	-227	-244	-208	-255	-311	-261	-247	-233
Profit before tax	1 137	871	1 294	5 328	1 388	1 366	740	2 582	2 056	1 734
Tax	-230	-160	559	-1 374	-684	-360	-98	-1 077	-597	-478
Profit for the year	907	711	1 853	3 955	704	1 006	642	1 505	1 459	1 256
Diluted earnings per share, SEK	10.8	8.5	22.1	47.1	8.4	12.0	7.6	17.8	17.2	14.8
Operating profit by business area**
Holmen Paper	141	-309	94	228	-618	340	280	623	754	631
Iggesund Paperboard	674	433	596	863	817	419	320	599	752	626
Holmen Timber	37	-75	-130	-136	20	21	13	146	80	13
Holmen Skog	817	924	931	739	818	605	632	702	643	537
Holmen Energi	212	371	355	406	495	414	327	272	197	301
Group-w ide	-146	-136	-132	-120	-200	-178	-159	-56	-123	-141
Group	1 734	1 209	1 713	1 980	1 332	1 620	1 412	2 286	2 303	1 967
EBITDA by business area**
Holmen Paper	725	429	862	1 002	229	1 218	1 176	1 537	1 667	1 358
Iggesund Paperboard	1 161	878	959	1 186	1 141	780	688	954	1 108	976
Holmen Timber	160	45	-10	-26	49	52	47	169	104	38
Holmen Skog	563	694	614	769	794	616	674	639	556	483
Holmen Energi	233	391	374	425	516	435	346	289	214	319
Group-w ide	-126	-121	-123	-116	-198	-176	-160	-54	-115	-122
Group	2 717	2 315	2 676	3 240	2 531	2 925	2 771	3 534	3 534	3 052
Deliveries
Printing paper, '000 tonnes	1 305	1 574	1 651	1 668	1 732	1 745	2 044	2 025	2 021	1 764
Paperboard, '000 tonnes	493	469	485	474	464	477	494	516	536	492
Saw n timber, '000 m³	725	686	660	487	285	313	266	262	248	229
MF	3 297	3 465	3 211	2 988	2 999	2 897	2 649	2 575	2 618	2 334
Production of company hydro pow er, GWh	1 048	1 008	1 343	1 230	1 145	1 090	1 128	1 193	934	1 236
Balance sheet
Non-current assets	30 221	30 652	30 664	30 334	26 028	25 694	26 506	26 153	25 354	25 793
Current assets	5 964	5 774	6 005	6 642	6 950	6 075	7 268	6 549	6 138	5 709
Financial receivables	249	327	377	240	454	407	828	541	649	712
Total assets	36 434	36 753	37 046	37 217	33 432	32 176	34 602	33 243	32 141	32 214
Equity	20 969	20 854	20 813	19 773	16 913	16 504	15 641	16 932	16 636	16 007
Deferred tax liability	5 480	5 804	5 504	6 630	5 910	5 045	4 819	5 482	5 030	5 143
Financial liabilities and interest-bearing provisions	6 156	6 443	6 967	6 499	6 227	6 091	8 332	6 518	6 634	7 351
Operating liabilities	3 829	3 653	3 762	4 313	4 382	4 536	5 809	4 310	3 841	3 713
Total equity and liabilities	36 434	36 753	37 046	37 217	33 432	32 176	34 602	33 243	32 141	32 214
Cash flow
Operating activities	2 176	2 011	2 254	2 101	1 523	2 873	1 660	2 476	2 358	2 471
Investing activities	-834	-869	-1 920	-1 733	-1 597	-818	-1 124	-1 315	-947	-3 029
Cash flow after investments	1 342	1 142	334	368	-74	2 054	536	1 161	1 411	-558
Key indicators
Return on capital employed, % **	6	4	7	9	6	7	6	10	10	9
Return on equity, %	4	3	9	23	4	6	4	9	9	8
Debt/equity ratio	0.28	0.29	0.32	0.32	0.34	0.34	0.48	0.35	0.36	0.41
Dividend
Dividend, SEK		9	9	8	7	7	9	12	12	11

* Items affecting comparability in 2014 refers to impairment loss on non-current assets (SEK -450 million). 2013 refers to impairment loss on non-current assets (SEK -100 million) and restructuring costs (SEK -40 million). 2012 refers to an impairment loss on non-current assets (SEK -153 million) and restructuring costs (SEK -40 million). 2011 refers to revaluation of forest (SEK +3 593 million). 2010 refers to impairment loss on non-current assets (SEK -555 million), restructuring costs (SEK -231 million) and revaluation of forest (SEK +1 050 million). 2008 refers to provisions and costs due to restructure and closure of mills and result effects from fire (SEK -361 million). 2007 refers to a net impairment loss on non-current assets (SEK -1 543) and revaluation of forest (SEK +2 100 million)

** Excl. items affecting comparability

Holmen in brief

Holmen's business concept is to develop and run profitable business within three product-oriented business areas for printing paper, paperboard and sawn timber as well as two raw material-oriented business areas for forest and energy. Europe is the key market.

The business area Holmen Paper manufactures printing paper for magazines, directories, advertising material, books and daily newspapers at two Swedish mills and one Spanish mill. Iggesund Paperboard produces paperboard for consumer packaging and graphics printing at one Swedish and one English mill. Holmen Timber produces sawn timber at two Swedish sawmills. In 2014, the Group produced 1.3 million tonnes of printing paper, 0.5 million tonnes of paperboard and 0.7 million cubic metres of sawn timber.

Holmen Skog manages the Group's forests covering just over one million hectares. The annual volume harvested in company forests is some 3.2 million cubic metres. Holmen Energi is responsible for the Group's hydro and wind power assets and for developing the Group's business within the energy sector. Normal yearly hydro power production amounts to some 1 100 GWh of electric power. Holmen Skog and Holmen Energi are also responsible for the Group's wood and electricity supply in Sweden.

Press and analyst conference

On the publication of the year-end report, a press and analyst conference will be held at 14.30 CET on Monday, February 9. Venue: Tändstickspalatset, Kreugersalen. Västra Trädgårdsgatan 15, Stockholm. Holmen President and CEO Henrik Sjölund will present and comment on the report. The presentation will be held in English.

The conference is also directly available as a webcast on Holmen's website, www.holmen.com. You may also participate in the conference by telephone, by calling +46 (0)8 505 564 74 (within Sweden), +44 (0)203 364 53 74 (from the rest of Europe) or +1 855 753 22 30 (from the US) no later than 14.25 CET.

Financial reports

Week 13 2015	Annual report 2014 is published on the Group's website
8 May 2015	Interim report January-March 2015
13 August 2015	Interim report January-June 2015
5 November 2015	Interim report January-September 2015
5 February 2015	Year-end report 2015

This is information that Holmen AB is obliged to disclose under the Swedish Securities Market Act and the Swedish Financial Instruments Trading Act. The information was submitted for publication on 9 February 2015 at 12.15 CET

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This is a translation of the Swedish interim report of Holmen Aktiebolag (publ.). In the event of inconsistency between the English and the Swedish versions, the Swedish version shall prevail.