Mondi SCP Investor and Analyst Presentation 28 November, 2007
TABLE OF CONTENTS Company History Management team Mill overview Products & Sales Productive capability Summary Site visit briefing PAGE 1
SLOVAKIA Bratislava High Tatras PAGE 2
SLOVAKIA Area: 49,035 km 2 Population: 5,4 mio Main industries: Automobile, chemical, iron ore processing, pulp and paper Forest land: 40.84% Austria Czech Republic Trnava Bratislava Zilina Trencin Piest any Nitra Martin Nove Zarnky Komarno Mondi SCP Ruzomberok Zvolen Banska Bystrica Slovakia Poland Poprad Roznava Hungary Presov Kosice Ukr. PAGE 3
MACROECONOMIC INDICATORS SLOVAKIA 2001 2002 2003 2004 2005 2006 2007 2008 2009 GDP growth (in %) 3.2 4.1 4.2 5.4 6.0 8.3 8.7 7.5 6.0 Unemployment rate (in %) 18.6 17.5 15.6 13.1 11,4 9.4 9.4 9.0 9.0 CPI inflation (avg in %) 6.5 3.4 9.3 5.9 3.7 4.2 2.5 2.0 2.0 SKK/EUR (avg) 43.3 42.7 41.5 40.0 38.6 37.2 33.8 33.0 1.0 GDP/Capita (in EUR) 4,025 4,426 4,976 5,607 7,059 7,887 9,241 10,321 11,265 20.0 12,000 Direct foreign investment in EUR m 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 10,000 8,000 6,000 4,000 2,000 1,419 4,347 939 852 567 1,549 0.0 2001 2002 2003 2004 2005 2006 2007 2008 2009 0 2001 2002 2003 2004 2005 2006 GDP/Capita in EUR GDP growth (in %) Unemployment rate in % CPI inflation (avg) in % PAGE 4
MONDI SCP PAGE 5
COMPANY HISTORY 2007 2000 1697 1697 Handmade production of paper in town near Ružomberok 1880 Jakub Klein & Co. started industrial paper manufacture in Ružomberok SOLO 1906 Hungarian Paper Mill was established SUPRA 1958 New company organization - Supra and Solo, new name SCP 1996 National Property Fund of Slovak Republic (FNM SR) sold SCP Ružomberok shares to Slovak company ECO INVEST Zvolen. Acquisition of 50% of shares by Mondi increased subsequently to 51%. 1697 1700 50 50 1800 25 50 57 1900 58 59 60 61 62 63 64 65 66 67 68 69 71 72 73 74 75 76 77 78 79 81 82 83 84 85 86 87 88 89 91 92 93 94 95 96 97 98 99 01 02 03 04 05 06 07 1970 1980 1990 2000 2003 2004 IMPULS project EUR 241 million invested in pulp, paper, energy and environmental fields. PAGE 6
MANAGEMENT TEAM MD Eliaz Amar 41 years old 12 years of paper experience Chairman of BOD / Eco-Invest (49% Shareholder) Miloslav Čurilla 44 years old 5 years of paper industry experience Divisional Manager for Pulp production Dušan Šimo 52 years old Divisional Manager for Paper production Franz Aigner 48 years old Financial Director Richard Žigmund 34 years old Head of Quality Management Olga Šotolová 55 years old Head of Human Resources Peter Jakubik 55 years old With Mondi for 28 years With Mondi for 33 years With Mondi for 5 years With Mondi for 20 years With Mondi for 30 years PAGE 7
SALES PER PRODUCTS AND SALES Sales per products Sales per regions Offset 37% Central & East Europe 30% 63% Office 70% West Europe PAGE 8
SAFETY Lost time injury frequency rate Mondi SCP in LTI / 200,000 working hrs employees + contractors 1.86 Target 2009 is 0.00, 0Tolerance Target 0 0.79 0.69 0.46 0.29 0.19 0.25 0.18 2001 2002 2003 2004 2005 2006 Target 2007 2007 YTD PAGE 9
PULP PRODUCTION, k tons CAGR +11% 401.3 55.3 421.4 40.7 318.3 227.2 257.9 77.6 270.2 71.8 270.3 36.4 38.4 SW a.d. 81.7 346.0 380.7 HW a.d. 145.5 180.4 198.5 233.9 279.9 2000 2001 2002 2003 2004 2005 2006 PAGE 10
PAPER PRODUCTION, k tons CAGR +11% 416.0 476.4 35.0 511.0 44.6 34.4 123.0 137.4 PM 16 (offset) PM 17 (offset) PM 18 (copy) 276.5 23.3 79.9 173.4 309.4 27.1 105.2 177.1 324.1 28.2 112.1 183.8 276.7 31.6 105.5 139.7 125.0 256.6 318.4 329.0 2000 2001 2002 2003 2004 2005 2006 PAGE 11
IMPULS PROJECT (2003 2004) REBUILD TARGETS PM 18 Capacity Quality Service z Increase PM18 capacity up to 290,000 tons (achieved 329,000 tons) z Improved paper quality z New cut size line z New mother reel storage z New warehouse for finished products Better working conditions PAGE 12
IMPULS PROJECT (2003 2004) New cut size line Capacity: 126 000 tons/year 10 pockets 2 parallel lines for packaging of reams and boxes Possibility to pack transparent wrappers Mother reel storage Capacity: 8 000 tons Fully automatic system Regulation of temperature and humidity Pallet warehouse Operational capacity: 8 000 tons Fully automatic rack warehouse for pallets 8 loading places for trucks (LKW) 3 loading places for wagons Loading capacity 250 pallets/h PAGE 13
IMPULS PROJECT (2003 2004) PROJECT TARGETS PULP MILL Capacity Increase the pulp mill capacity up to 375,000 tons (achieved 421,000tons) Improvement of environmental footprint Better working conditions for our employees PAGE 14
PRODUCTIVITY PM18 BEING WORLD LEADER IN PRODUCTIVITY 1 Headcount, average 3500 3000 2500 2000 1500 1000 500 0 3.179 160 14 27 2.991 190 10 20 2.704 20 10 2.503 220 219 18-19 2.317 317 18 81 419 484 2.093 2000 2001 2002 2003 2004 2005 2006 Adjustments in 2006: 1) Headcount does not include passive employees & shared services 2) Production includes non-core paper from Obaly Solo subsidiary 1 Metso Benchmark on paper machine net production measured as km²/meter deckle width CAGR +20% 34 69 Increase due to bigger production Increase due to headcount reduction ADJ: 526 1.895 ADJ: 1.840 Productivity in tons per Headcount 44 20 570 470 370 270 170 70-30 Headcount, average Productivity PAGE 15
COMPETITIVE ADVANTAGES Mondi SCP Quality assets base People Performance Modern Integrated pulp and paper producer Energy Pulp market exposure Other costs synergies Relatively low labour cost Wood availability and costs Geographical proximity to major markets Country risk profile Organisational culture Change management Innovations Continuous cost position improvements CAPEX allocations and project management Productivity PAGE 16
SITE VISIT BRIEFING
SITE VISIT BRIEFING We are here PAGE 18