UPM-Kymmene Oyj

Jussi Pesonen - President, CEO Tapio Korpeinen - CFO

Antti Koskivuori - Danske Bank Mikael Jafs - Kepler Cheuvreux Lars Kjellberg - Credit Suisse Linus Larsson - SEB Rebecca Clements - BlueMountain Capital Mikael Doepel - Handelsbanken Capital Markets Harri Taittonen - Nordea Giles Thorne - Jefferies

Ladies and gentlemen, good afternoon. Welcome to UPM's Second Quarter 2015 Result webcast.

My name is Jussi Pesonen. I'm the CEO of UPM.

And I'm here with Tapio Korpeinen.

Good afternoon, everyone.

Ladies and gentlemen, let's start. Good progress continued in second quarter profitability improved.

In second quarter, we made progress on several areas. First, our earnings continued to grow comparing with last year's second quarter.

Our profit improvement program progressed fast having a significant impact on both variable and fixed costs. With these cost savings, we were able to offset the headwind from sales prices especially in challenging European publication paper business.

Favorable currencies also helped even though big part of the currency benefit is still withheld by our currency hedges. Second, our cash flow was strong in the quarter.

Cash flow improved both from the previous quarter and compared with Q2 last year. Third, we completed 800,000 tons of publication paper capacity closures in Q2.

This will boost our cost efficiency in paper ENA during the seasonally stronger second half this year. And finally, our growth project progressed well, UPM BioVerno renewable diesel was launched to the Finnish consumers in May.

UPM Raflatac expansion in Asia Pacific and Poland started up by the end of the quarter. The investment at our Kymi pulp mill in Finland and Changshu paper mill progressed well.

We also announced two new investments during the quarter. One, at the Otepää plywood mill in Estonia and the other one our Kaukas pulp mill here in Finland.

All in all, with our profit improvement program, growth projects and favorable currencies, we are well positioned for earnings growth. Then on Page 3, that shows UPM's main financial KPI's for second quarter.

You can see that we achieved some improvement in all of these metrics compared with Q2 last year. Looking at the -- our sales and sales mix, I would like to point out that UPM's transformation has continued in a very solid track.

Four of our businesses, Biorefining, Raflatac, Plywood, Paper Asia are operating on growth markets and enjoying favorable market conditions. These businesses have shown top line growth compared with last year.

In these businesses, we also have several growth projects in the pipeline. At the same time, as you well know, the paper ENA operates on a very challenging markets.

Here top line decreased 6% from last year. In paper ENA, we closed 800,000 tons of news print and magazine paper capacity during the first half of the year.

But all in all, our group sales grew 4% in Q2 and paper ENA represented only 43% of UPM sales. Page 4, shows the progress of our €150 million profit improvement program.

In Q2, variable cost savings continued to materialize; Q2 also included a fixed cost reduction from three of our four paper machine closures. In Q2, actions under the program decreased UPM cost by €108 million on annual level and this means 72% of the targeted savings has been already achieved.

Fast progress of this profit improvement program as well as program last year had been key to our improved earnings this year. But ladies and gentlemen, at this point, I handover to Tapio for some further analysis of our result.

Tapio, please?

Thank you, Jussi. This following Page 5 on the left-hand side, you can see UPM's EBITDA development by earnings driver.

The impact from prices and cost items is shown in constant currencies. And the net impact from currencies is shown as a separate factor including hedging.

We had significant headwind from sales prices especially from publication paper prices in Europe as compared with last year. All in all, changes in sales prices decreased our EBITDA by about €90 million.

As Jussi already mentioned, we are able to offset this headwind almost completely by reducing our variable cost by more than €80 million. Really more than half of the variable cost reduction is attributable to the actions taken under the profit improvement program last year as well as the fast progress in the €150 million profit improvement program for this year.

The impact from changes in delivery volumes was slightly negative offset by small decrease in fixed costs. Changes in currencies had a positive impact on UPM's earnings moderated by the currency hedges that we have in place.

Taking the hedges into account the positive impact from currencies in our second quarter EBITDA as compared to second quarter last year was €24 million. In the second quarter, the realized currency hedges decreased UPM's EBITDA by €36 million.

If currencies stayed where they are today, this part of the positive currency impact would materializes as the hedges roll over. On business area level, the positive currency impact supported biorefining, whereas the corresponding €36 million negative impact of currency hedges affected paper ENA and paper Asia businesses.

The strong pulp price development in Euros boosted by a refining result, but increased cost in the pulp consuming paper businesses. This is visible on the right-hand side of the slide where biorefining shows significant earnings growth and paper ENA and paper Asia are weaker than last year.

Paper ENA and energy also suffered from lower sales prices whereas Raflatac showed strong development in both sales volumes and sales margins. While energy business area suffered from the lower market price of electricity, we were able to mitigate the negative impact through hedging hydro optimization and overall, higher hydro volumes.

At the same time, lower energy cost is a benefit for paper ENA in particular on top of which we have taken energy related actions in our profit improvement programs. On group level energy has been a small positive factor for UPM earnings overall.

This page shows the operating profit development by business area. Biorefining and Raflatac in particular had a strong second quarter as compared to the second quarter last year.

As discussed, realized currency energy hedges reduced our profit by €36 million in the second quarter affecting paper ENA and paper Asia businesses. The underlying operating performance in the paper businesses was quite steady through first and second quarter.

The full benefit of the current exchange rates will flow through to the bottom line during the coming quarters as the hedges roll over with constant exchange rates this would equal to €36 million versus the second quarter. Page 7 shows our cash flow.

Our operating cash flow increased to €324 million in the second quarter including a working capital release of €31 million in the quarter. Over the past 12 months, our operating cash flow totals nearly €1.2 billion or €2.24 per share.

Here we see our net debt which stood at €2.635 billion at the end of the quarter. During the second quarter, we paid the dividend of €373 million or €0.70 per share.

This resulted to a small increase in net debt during the quarter. Net debt to EBITDA was 2x in Q2 and [gearing] [ph] was 35%.

Our outlook for 2015 is unchanged, we expect that the good profitability achieved last year will continue in 2015 and we see some prospects for further improvement. As we are already half way through the year, we have added one further piece of clarification for the second half of the year.

We expect that paper ENA will improve it's profitability in the second half of the year as compared with the first half. In the second half, paper ENA cost efficiency and capacity utilizations rates will benefit from the capacity closures and other cost savings achieved under the profit improvement program.

Second half of the year is also seasonally stronger than the first half in terms of volumes. The 800,000 tons capacity closures now implemented will enable us a full run during the second half.

This means improved cost efficiency as well. And I would like to hand over back to Jussi for some comments on our growth projects.

Thank you, Tapio. Let's move to the Page 10, which summarizes our growth projects.

It is really now getting to a point where excitement is – of the three year program, our growth projects Pietarsaari and Fray Bentos mill expansions as well as Lappeenranta Biorefinery investment are in the ramp up phase. Raflatac's capacity addition in APAC and in Poland started up [indiscernible] second quarter and will enable Raflatac to continue to grow in the coming quarters and years.

The last two really the main project if I say that way Kymi pulp mill expansion and labeling materials machine in Changshu mill in China are due to start-up by the end of the year. Both of them have been proceeding well and the projects are on time and on budget.

In H1 2015, the earnings impact from these projects that are on the ramp up curve are still very small. We are getting close to the time when we start to see the returns gradually materialize.

In pulp, these projects will increase our pulping capacity by 10% from 3.3 million tons to 3.6 million tons and in the first half of 2015, we have seen really a very little out of this done projects but more to come. The Lappeenranta refinery is still in its ramp up and learning curve based on our experience so far we know that the technology works, product meets all expectations and the business case is solid.

One milestone was reached in May, when the distribution of UPM renewable diesel to Finnish consumers started. During second quarter, we also announced two more growth investments.

They are shown here as well. We will invest €40 million to expand our Otepää plywood mill in Estonia and this enables the top performing plywood business to grow.

We also invested €50 million – invest €50 million in the Kaukas pulp mill, the investment will improve efficiency at the mill as well as complete decoupling of UPM's pulp and paper businesses from each other. Both of these investments will be completed by the end of 2016.

Page 11, summarizes our CapEx, even though we will have a fair amount of growth CapEx in 2015, our CapEx at around €500 million will stay and remain slightly below deprecation. And as you can see from here, the next year's CapEx is going to be lower again.

Ladies and gentlemen, I would like to summarize my – part of Tapio's and my presentation by saying we were able to increase our earnings year-over-year in the first half of the year and in Q2. Our own profit improvement program and favorable currencies were outwitting the market headwind that we had actually in publication papers and energy.

This gives us a good starting point to continue our earnings growth. First, our profit improvement program will continue offering further savings in the latter part of the year.

Our growth projects are coming to a period when they start to contribute to our earnings and finally, current currency rates will provide further tailwind as the hedges rollover. Our cash flow and balance sheet are strong which enables UPM simultaneously distribute attractive dividend implement growth project and act on strategic opportunities.

I will stop here by using these two slides which are really as valid as they have ever been UPM strategy actions where we have a short-term, medium term and long-term aims and targets for the each and every six business areas and our operating model is more or less attractive dividends, strong cash flow focused investments and top performing six businesses. Ladies and gentlemen, this was the prepared part of the presentation and now we are ready to answer your questions.

Dear operator, I hand over to you for Q&A session.

Yes. Thank you.

I would have three questions, first one being – about the strategy in your energy division and you have been very vocal about your ambitions to leverage the current power business platform. Now that Olkiluoto IV project is not taking off, are you looking more into acquisitions or is there a change to your strategy in this business?

That would be the first question. And then secondly, if you could discuss a little bit more about the Lappeenranta bio-diesel refinery ramp up process, I mean you say that the refiners working technically as planned and the product quality is where it should be.

What are the issues that needs to be solved before you are fully running in Lappeenranta? That would be the second question.

And then thirdly about the FX, could give us some color that if we would assume that the current FX rates would hold, what would you see the impact being on your earnings in H2 versus H1 from FX? Thank you.

Thanks Antti. Maybe if I take actually the first two questions.

Energy business strategy has not changed. Our view of the energy business has not changed.

You obviously remember that Olkiluoto III will increase our energy capacity by 500 megawatts, so again, we are having a growth there and significant growth actually in the energy business and all Olkiluoto IV would have been more than 10 years from today. So basically, our strategy has not changed, obviously if there are any opportunities for efficient acquisitions and M&A that is something that we consider.

Biodiesel, obviously, I said three things, I said that the business case is still solid that was the third one that you missed. We believe that the business case is solid.

And obviously, we are testing like I said we have been now running first five, six months of the business and we have learned a lot and like is said, the technology works and the cost – quality of the product is good. We are delivering already as planned.

The team is working 24/7 to get maximum out of it. We are not still yet there.

But, hopefully in the coming months we will start to achieve the high operating rates and high output of the mill. It is a new business and I think that we are very comfortable at this stage what we do.

And then Tapio, actually the third one.

Yes. And the FX, first of all, as already mentioned with the current exchange rates, there was €36 million impact from the hedges in the second quarter results.

So in other words, there was €36 million benefit from the current exchange rates that did not flow through the bottom line because of the hedging result. And during the quarter, if – in a sense, we had constant exchange rates going forward that impact will go away gradually as the hedges expire.

But, is it €36 million the reference for H2 or is it the gradually -- those going gradually away means that by H2 is less than €36 million?

€36 million is for one quarter, but then it will take – it will not go away in one quarter, so it will go gradually and the quarterly impact from the €36 million to zero during the coming time.

All right. Thank you very much.

Very helpful.

Yes. Hello, good afternoon, everybody.

I have a couple of questions. The first one is, you are talking about lower cost and higher utilization rate in your paper ENA business?

Could you give us a short summary on how you view the overall market in terms of capacity utilization for the second half? And then a second question on the pulp market, in the report you talk about projects further out in time that might add to capacity and might result in some pressure, further out in time, but a couple of words perhaps on what do you think the effect will be about this large pulp mill in Shandong province that apparently is down due to water shortage at least until October?

I think I will stop there. Thank you.

Mikael, let me recall, no, at least 800,000 tons that we took away out of what we are having close to 10 million tons of capacity represent maybe a big number in increase of our capacity utilization rate. So that is definitely a unique for UPM to improve the operative kind of efficiencies and operating rates.

So that is of course, I do not have a view actually where the whole market is held up [busy] [ph] and fine papers are tighter than that of newsprint and SC. But, I do not have a view what is going on for the rest.

This is for us an unique opportunity. This will lower our cost in fixed type but its lower cost because of the efficiency gains when having a higher operating rates for the second half.

Then pulp is interesting, where actually the [indiscernible] mill is coming on-stream and is already operating but at the same time as yourself mentioned the Rizhao mill in Shandong province is now actually having a temporary shut down until October. It's 1.8 million ton million, so having a significant kind of impact on the markets.

So we believe that the pulp markets will be traditional for the next couple of quarters.

Okay. Thank you so much.

And then a last question. Could you explain and give some color and flavor on the accounting on the fair value by a logical assets and wood harvested, it seems to be a volatile number and could you please give us some color and flavor about us how we outsiders should think about that number?

Well, again, the value of the growing trees are accounted for at fair value meaning that we have a TCF model where there is actually quite accurate information on inventory of growing trees and then obviously, let's say or should differ longer term view as far as the price development for wood is concerned in Finland. And what is affecting the quarterly figure or the sort of annual change in that figure is, apart from many possible changes in the market the such – the growth of trees which increases obviously the value of inventory and on the other hand, the amount that we harvest which on the other hand then depletes the inventory and as a negative impact on value and then a third factor that had an impact during the recent times and also in the second quarter is that when we have been selling larger forest estates we have been actually able to get a higher value per hectare than what we have accounted for even it has been based on the TCF value.

So that has been then recorded as kind of an additional increase in the fair value. The value that has been released or materialized through the forest asset sales.

Okay. Thank you very much.

Thank you. Just a couple – one follow-up to start off with.

The drought situation in China, do you have any information or sense of what it actually means for paper and board manufacturing in China, if there is an offset i.e., either supports supply shortage of course. But, what is the impact on the demand side.

Second thing, I just wanted to get your thoughts on this, we have seen a significant acceleration of demand weakness in publication papers in the U.S. in the second quarter.

Do you have a view what is driving that and why that should change? And then finally, a question on the cost cutting, you obviously doing very well, are you finding as you go along there is incremental potential to take out more cost from your current actions for just a 150 target, still the targets you are looking for?

Lars, first question about the demand in China at least what we have seen for our paper making and for our businesses in pulp business we sell a lot of goods in China, timber pulp paper, for example and we have not seen any demand change on those product areas at this point. And obviously, the kind of temporary stoppage in the pulp mill in Rizhao doesn't have an effect.

Second was talking about pulp, I don't remember anymore the question, what was your second?

Just a one point in a sense that -- if and when there are impacts on paper or board capacity in China that does not affect market pulp demand if the paper and board demand is out there because obviously that volume produced just has to shift to another mill in China.

Then the last question was at least the cost do we see still potential I guess that I have been answering these last 10 years or 11 years to be precise and I believe that there are still no potential to improve our cost structure and obviously, well, we kind in of aiming for example in the declining paper business is to have a high utilization rates and therefore the cost efficiency is improving and we need to improve it further -- I guess that there are plentiful of options and opportunities still to go.

My second question was actually referencing North American paper demand which seems to have accelerated to decline that is in the second quarter.

Yes.

What are you saying that can actually drive that sequential meaningful step down in consumption patterns?

I wouldn't draw at this point any kind of dramatic kind of conclusions what is going on like we need to see some what more obviously what is going on, on that market. We support news printer as it is in Europe has been more or less quite a challenging demand for years showing minus, more or less minus almost 10% decline, but I wouldn't draw any kind of dramatic conclusions at this point.

And have you seen any change going into the seasonally stronger period now with going back into school advertising and that sort of stuff in your order books and you now more normalized now than you were in the second quarter?

No. I guess that we have a quite – had a seasonally stronger quarters are coming and therefore it is same in all of our markets.

And final question on FX, I guess what was noted there has been an increase in exports from Europe. How do you see that playing through in overseas pricing, I mean we have been hearing from Brazil there has been meaningful pricing pressure imported products.

I guess there has been talks about potential pressures in the U.S. in terms of pricing.

What are you sensing? Is that something that will gradually take away some of the FX benefits that we'll see as the hedges expire or of course not pricing a component of the second half guidance in overseas markets?

Time will tell, but typically actually when it comes to this movements of volumes they are not that big, we at least have been typically pretty consistent on our volumes and there might be some more coming from Europe to North America and the other areas of exports as well. But typically they are still minor moves when it comes to volumes and obviously takes the pressure out of Europe which is a good thing.

Just one final question if I may, you of course mentioned that some of the growth projects were start delivering and that was very minor contribution from those in H1, when should we start to see anything worthwhile talking about in terms of contribution, in terms of calendar?

Obviously the big two project more or less 400 million out of this whole thing is about to start end of this year. So Kymi pulp mill which is 160 million and then the Changshu label materials machine 277 million so those are the maturity of the biggest part of the change.

But, all of these that have been now started up will start to show the results in our results. But we don't have a particular point when we see it, but gradually all of them when they are in a full run they will then start to contribute.

Thank you.

Thank you very much. And good afternoon to everyone.

Couple of questions on electricity pricing if I may Nordic electricity prices have come off quite a bit and I wonder when we look at the rest of the year if you have any thoughts to share on your pricing, your realized price came off again in Q2 versus Q1 to what extent are you hedged in Q3 and Q4, any other comments in relation to this please?

Yes, as I've indicated already in the, after the first quarter result are sort of position is such that the biggest impact from the lower prices or the price drop during this year we saw in the first quarter and I would expect that we are pretty stable from that point of view going forward. We had €11 difference to market prices in the second quarter and again, I said before it's because of hedges and but also it's because of our hydro optimization.

And then of course recently what we have had helping us is the fact that as there is quite a lot of water in Finland also we have high availability of hydro which means more volume and lower cost for the power generated.

Okay. Thanks.

And when it comes to asset values in the energy division how will those, how are they affected by the significant decline in market prices that we have seen, what are your assumptions is there -- isn't there a read through from the lower market prices into your balance sheet here?

Yes. Again, just to remind everyone we do account for the generating assets that we have in the associated companies here in Finland, TVO and Kemijoki; TVO or TVO through PVO and some smaller others we account for those at fair value and any change in that fair value go straight to equity it does not impact our P&L statement.

The model that we use for calculating that fair value there we have our view on the long-term price development of electricity in Finland, so therefore, whatever you see happening in the forward curve, which can be quite volatile in the short-term does not directly fit into the valuation there. Of course, obviously, we do sort of update and review our forecast for the coming years and for the long-term continuously when we do the asset valuation.

And therefore also we have had a decrease in the fair value of those assets also during this year as you can see in the quarterly statement. But again, forward curves are quite volatile so therefore they don't sort of directly translate into the same kind of volatility in our asset values.

And as we are still generating a 43% operating margin on those assets, I'm pretty comfortable with the value that we have in the balance sheet.

And is this something that you review once a year or is that at any point in time?

As always in IFRS, you have to estimate any changes in the marketplace continuously and then when need be make changes to the values.

Okay. What is your price assumption?

It's a long term forecast.

Yes. And there is nothing that you disclose?

No. I'm afraid no.

Okay. Just one follow-up on the biodiesel project of yours, you are now in the ramp up phase at Lappeenranta.

Just give us a sense of the timeline of potential further investments in this field when -- how is your evaluation process, when at the earliest would you invest in another line, when at the earliest would you see a start-up of another line if you could give us any sense of that please?

There is no such information unfortunately obviously what we do at this point is really the ramp up the Lappeenranta, but obviously, when that start then we need to consider what are the next steps and when, but unfortunate there is no that kind of information available at this point.

Okay. Those were my questions.

Thank you.

Hi, guys. Thanks for taking my question.

Just going back to the paper division and publication papers, you said that utilization will improve in the second half. Can you give us a sense for what it was in the first half?

We are not disclosing that, but clearly below 90%.

Okay. And do you expect with -- assuming demand trends I guess remains somewhat consistent with what we've seen, do you expect to get back to kind of the 90% level given that you've taken out that capacity?

No, 800,000 tons out almost 10 million tons is more or less 8% to 9% units and seasonally stronger quarters are coming so obviously we are running at the very high full capacity level for the remaining part of the year. But that 800,000 is really the key for this whole thing.

Okay. And I'm just curious, it seems that pricing from what I've heard from other competitors et cetera pricing probably won't really improve until the fourth quarter.

Why do you think that the closures didn't have more of an impact on price sooner than that?

No. For example, we will see actually now a small increase in LWC and in fine papers during the third and fourth quarter.

So it has no effect and news print prices there are some declines especially in the U.K. market where the strong pound/sterling is clear.

But that is where there is overcapacity situation. And what we do actually by closing capacities to improve efficiency, cost efficiency, cost efficiency and cost efficiency.

Okay. And is there anything given the decline so far year-to-date have actually been I think in excess of sort of the general, I think kind of 5% demand decline for a volume perspective that generally is guided to.

What's been going on in the first half of the year to make this more like an 8% to 10% decline in the market?

Well, it depends how the paper product, some of the paper products are less than 5% and then some of them are somewhat more than 5%, but average is 5%. Sorry?

I was thinking more in the publication paper side?

Yes, news print is definitely higher.

Is there anything specific going on there or is that the new norm do you think?

No, I don't. It has been always, I think that if you are looking our presentation where you see that 5% in magazines, 8% in news print and 3% in fine papers that is the trend almost if you look at our percentage and where you have this trends, I think that I'm pretty happy with talking about 5% in magazine grades, 8% in news and 3% in fine.

Okay. Okay.

Thanks for that.

Thank you.

Yes. Hi there just one question left is actually like the follow-up on your comments on the possible dynamics effects from the more favorable currency situation.

You mentioned that you have been seeing some volumes flowing out of Europe, example North America, but so far the changes have been fairly minor, if you would assume that the currency rates stays at the current level, how big of tonnages would you say that would be possible to start to ship out of your longer term?

Mikael, I don't have a figure for that and I don't believe that there will be a lot of volumes moving on. You need to have a very efficient kind of delivery kind of route prime route to be efficiently going anywhere from Europe.

And therefore I don't believe that there will be a big volume, big shift on, once again, on those volumes even if the currency stays where it is. And that is the reason why we have always believed that you need to have a kind of prime route efficiency to where ever we go and to those selected customers.

I don't believe that that will kind of make any big shifts even if the currency stays where it is.

Okay. That secures.

Thank you.

Yes. Hello.

Harri Taittonen from Nordea. On the asset valuation side, you talked about the energy side, but on the forest valuation whether this current rate is 7.5% and the recent transactions have mainly been quite high compared to the book value of the forest asset.

I mean, how often or what's the schedule for reviewing the valuation of the forest asset. And if there are changes in the valuation there, would that go through the P&L or would that also be going directly to equity?

Yes. In the case of the forest assets also is in this quarter or every quarter prior any change in the fair value does flow through the P&L in the operating profit.

It's reported in the other operation segment. And also in the case of the forest assets, we do sort of [indiscernible] and update the assumptions continuously, asset we have had let's say a good success with the sale of forest estates reaching higher valuations on the other hand, it doesn't necessarily mean that you can sort of extrapolate that correctly to the total mass of forest land here in Finland which of course would be a kind of a theoretical notion of selling all of our forest in the open market in one go here in Finland.

So therefore, you consider directly extrapolate to the whole land area. When it comes to discount rates, discount rates we have a kind of pipeline there in a sense that as long as the discount rate change is such that we – or let's say the interest rate changes are such that we stay within a certain pipeline as far as the discount rate for the forest is concerned.

Then directly it doesn't necessarily mean that we will change the discount rate which obviously would have impact on the valuation. But, overall, I would say that obviously, if you look at market for forest assets in Finland, it has been quite good, and the market for wood in Finland is quite stable.

So from that point of view, I would say that value of the forest assets is quite prudent as it is in our balance sheet. And we are obviously sort of monitoring it on a continuous basis.

Okay. That's helpful.

And on that issue of wood availability from outside Finland, obviously in the recent months any sort of changes in that kind of outlook for the availability and cost wood from – on the other side of the Eastern border?

No. Actually it has been working pretty well and the Russian deliveries have been kind of spot on, no, issues on that at this point.

Excellent. Thank you.

Good afternoon. Please could you help with the 200 million EBITDA growth projects?

Could you give an indication of how much is going to be coming from pulp debottlenecking and how much is coming from the new Changshu machine? And then secondly, of the 36 million hedging impact, how much of that was from paper ENA versus paper Asia, I'm just trying to get a view of what the margins were excluding FX hedging?

Well, I say first, on your first question the 200 million EBITDA impact it does include – it does include the pulp debottlenecking investments both here in Finland and in Uruguay the capacity increase so the operating permit and capacity increase, it does include the Changshu paper machine. Also the biodiesel plant in Lappeenranta as well as expansions in Raflatac, so it's actually kind of a some total of this growth projects that we have been discussing already earlier.

We don't break that down but obviously let's say large contributor is pulp business, second largest then is Changshu label materials machine. And then I would say kind of 13 order comes to the biodiesel plant.

And then of course, smaller scale are the Raflatac expansions or investments, so let's say a smaller contribution from those.

Thank you.

Oh, there was yes, sorry. There was a question also concerning the 36 million hedging impact and we don't sort of obviously sort of break it down but have to remember that the size of the business paper ENA is much bigger than paper Asia.

So somewhat larger part is in the paper ENA.

Thanks for the color.

Thank you, dear participants. Thank you for your interest in UPM and have a good afternoon.

Thank you. Bye now.