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Crown Van Gelder N.V. Velsen Presentation 10 February 2006 Annual results 2005.

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Presentation on theme: "Crown Van Gelder N.V. Velsen Presentation 10 February 2006 Annual results 2005."— Presentation transcript:

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2 Crown Van Gelder N.V. Velsen Presentation 10 February 2006 Annual results 2005

3 1.Opening 2.Highlights Key figures 4.Production and sales volume CVG 5.Paper machines and power plant rebuilt 6.P&L, Balance Sheet, Cash Flow 7.Investments 8.IFRS 9.Results and outlook European paper companies 10.Mission Assumptions and outlook CVG for Questions 1.Opening 2.Highlights Key figures 4.Production and sales volume CVG 5.Paper machines and power plant rebuilt 6.P&L, Balance Sheet, Cash Flow 7.Investments 8.IFRS 9.Results and outlook European paper companies 10.Mission Assumptions and outlook CVG for Questions Agenda 10 February 2006

4 Net result EUR 8.1 million, down 3% on 2004 Sales volume increase of 5% to 200,400 ton Selling price down with 2.4% on 2004 PM 1 / PM 2 and power plant successfully rebuilt Dividend proposal of EUR 1 per share certificate (54% pay out) Mission statement 2010 Net result EUR 8.1 million, down 3% on 2004 Sales volume increase of 5% to 200,400 ton Selling price down with 2.4% on 2004 PM 1 / PM 2 and power plant successfully rebuilt Dividend proposal of EUR 1 per share certificate (54% pay out) Mission statement 2010 Highlights 2005

5 Key figures

6 WF Uncoated order inflow total – 3 weeks average

7 WF Uncoated Order Stocks and Deliveries

8 Geographical spread of sales volume CVG 12% 15% 23% 17% 15% 4% 14% Germany Outside Europe Other Europe Belgium/Luxembourg United Kingdom France Netherlands Production and sales volume CVG

9 Wk 46Wk 47Wk 48Wk 49Wk 50 Power plant automation DLE gas turbine Paper machine 1 Paper machine 2 Temporary steam unit New HD gas pipe Rebuilt

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12 NBSK

13 BHKP

14 Consolidated profit & loss account (EUR x 1,000) (unaudited)

15 Result analysis 2005 vs 2004 (EUR mln) Net turnover Paper - Sales increase Lower prices(3.3) +3.8 Electricity - Lower supply volume to the public grid(0.8) - Lower prices for supply to the public grid(0.1) (0.9) Net turnover

16 Result analysis 2005 vs 2004 (EUR mln) Bleached Pulp - Higher purchase volume Higher prices Gas - Lower purchase volume(0.3) - Higher price level (taxes)+0.1 (0.2) Electricity - Higher purchase volume Lower MEP-subsidy Total cost increase 2005 vs

17 IFRS

18 Consolidated Balance Sheet (before profit appropriation) (EUR x 1,000) (unaudited)

19 Consolidated Cash Flow Statement (EUR x 1,000) (unaudited)

20 Capital Expenditure 2005 (EUR x 1 million) IMP II PM 1 / PM 26.4 Power Plant10.4 Coating Preparation Unit2.3 Disc Filter (save all)0.6 Other projects1.9 Total21.6

21 Results and outlook European paper companies

22 Net profit of EUR -126 mln (2004: EUR 838 mln) Non-recurring items EUR -451 mln (2004: EUR 370 mln) Operating profit Fine Paper division EUR 62 mln (2004: EUR 55 mln) Sales volume (3.6 mln ton) equals last year; stable selling prices ROCE Fine Paper increased from 1.9% to 2.2% in 2005 Operational loss of EUR 190 mln due to labour dispute Net profit of EUR -126 mln (2004: EUR 838 mln) Non-recurring items EUR -451 mln (2004: EUR 370 mln) Operating profit Fine Paper division EUR 62 mln (2004: EUR 55 mln) Sales volume (3.6 mln ton) equals last year; stable selling prices ROCE Fine Paper increased from 1.9% to 2.2% in 2005 Operational loss of EUR 190 mln due to labour dispute StoraEnso results

23 Net result decreased from EUR 920 mln to EUR 261 mln in 2005 Non-recurring items EUR -249 mln (2004: gain of EUR 205 mln) Operating profit Fine and Speciality Papers division decreases from EUR 160 mln in 2004 to EUR 88 in 2005 Sales volume (3 mln ton) equals 2004 Selling prices -1% ROCE from 6.1% in 2004 to 3.4% in 2005 Net result decreased from EUR 920 mln to EUR 261 mln in 2005 Non-recurring items EUR -249 mln (2004: gain of EUR 205 mln) Operating profit Fine and Speciality Papers division decreases from EUR 160 mln in 2004 to EUR 88 in 2005 Sales volume (3 mln ton) equals 2004 Selling prices -1% ROCE from 6.1% in 2004 to 3.4% in 2005 UPM-Kymmene results

24 Net result of EUR -81 mln (2004: EUR 45 mln) Non-recurring items EUR 32 mln (2004: EUR – 33 mln) Operating profit Office Paper division EUR -0.7 mln (2004: EUR 1.5 mln) Sales volume up by 7.6% to 1,034 mln ton Selling prices -3% ROCE Office Paper -0.5% (2004: 1.3%) Net result of EUR -81 mln (2004: EUR 45 mln) Non-recurring items EUR 32 mln (2004: EUR – 33 mln) Operating profit Office Paper division EUR -0.7 mln (2004: EUR 1.5 mln) Sales volume up by 7.6% to 1,034 mln ton Selling prices -3% ROCE Office Paper -0.5% (2004: 1.3%) M-Real results

25 Jukka Härmalä (CEO StoraEnso): “In Europe a slight pick-up in advertising and direct marketing is expected to stimulate demand for advertising-driven papers …. The fine paper market is heading into a seasonally good first quarter and the demand outlook is favourable, which should support some price increases.” UPM-Kymmene Board: “Demand for printing papers is forecast to be better than last year. Growth in demand will be stronger within emerging markets. Average paper prices are forecast to be higher. Raw materials and energy prices are forecast to rise faster than inflation. UPM is continuing cost cutting and studying a number of options to achieve a lasting improvement in profitability.” Jukka Härmalä (CEO StoraEnso): “In Europe a slight pick-up in advertising and direct marketing is expected to stimulate demand for advertising-driven papers …. The fine paper market is heading into a seasonally good first quarter and the demand outlook is favourable, which should support some price increases.” UPM-Kymmene Board: “Demand for printing papers is forecast to be better than last year. Growth in demand will be stronger within emerging markets. Average paper prices are forecast to be higher. Raw materials and energy prices are forecast to rise faster than inflation. UPM is continuing cost cutting and studying a number of options to achieve a lasting improvement in profitability.” Outlook

26 Hannu Antilla (CEO M-Real): “Demand for our main products will improve during the first quarter, and we are optimistic about price increases, particularly for uncoated fine paper. The price of coated magazine paper is also likely to rise somewhat. Because of the sharp rise in production costs, there is a considerable need for price increases in coated fine paper and paperboard products.” Outlook

27 ROCE Comparison CVG and Peer Group

28 Source: Cepifine Conclusion: slow increase in utilisation rate CEPIFINE

29 Product portfolio

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31 Based upon a study of market developments and trend analyses we set 10 targets for CVG to be reached in 2010 Mission Higher added value to existing and new customers 2.Production to 230,000 ton, industrial applications from 44% in 2005 to 50% 3.Focus on service: first-time-right, smaller runs, customer satisfaction +7 4.Exploiting benefits of independent company, short lines, decisive organisation 5.Extending customer base 6.ROCE of 11% over cycle, increase pay-out to 50-60% of net earnings 7.Sustainable organisation in energy and raw materials (50% with CoC) 8.Increase competence level of personnel 9.Health and Safety < 10 industrial accidents per 1,000 employees 10.Reducing sickness rate to < 4% per annum

32 Assumptions Sales and production volume up to 210,000 ton Implement higher prices in commodities Introduction of new products Capital expenditure around EUR 8 mln Increase of energy costs of around EUR 6 mln ?Price of bleached pulp and USD/EUR exchange rate ?Selling price development Assumptions Sales and production volume up to 210,000 ton Implement higher prices in commodities Introduction of new products Capital expenditure around EUR 8 mln Increase of energy costs of around EUR 6 mln ?Price of bleached pulp and USD/EUR exchange rate ?Selling price development Assumptions and outlook for 2006 Outlook Forecast result CVG uncertain, but likely to be lower than in 2005 Outlook Forecast result CVG uncertain, but likely to be lower than in 2005

33 Meeting 10 February 2006 Questions


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