Norske Skog’s EBITDA in the second quarter of 2022 was NOK 905 million, an increase from NOK 610 million in the first quarter of 2022. Sales prices for all grades increased in the quarter as a consequence of high energy costs in Europe and a tight publication paper market. The containerboard conversions and energy projects are progressing as planned. Cash flow from operations was NOK 473 million in the quarter compared to NOK 196 million in the previous quarter, positively impacted by the improved operating margins, but negatively impacted by change in working capital, being mainly an increase in inventories, and trade and other receivables. Operating earnings in the second quarter of 2022 were NOK 1 195 million compared to operating earnings in the first quarter of 2022 of NOK 593 million. The quarter was positively affected by non-cash changes in fair value of energy contracts in Norway amounting to NOK 419 million. Net profit in the quarter was NOK 935 million compared to a net profit of NOK 583 million in the previous quarter. Net interest-bearing debt was NOK 1 012 million at the end of the second quarter, with an equity ratio of 42%.

Flambeau River Paper announced the shutdown of its #3 paper machine to be effective immediately. #3 paper machine primarily produces commodity white papers and has been impacted by the ongoing and unprecedented rise in pulp costs coupled with an in-elasticity of commodity paper price. Flambeau River Papers’ #1 and #2 paper machines along with the Flambeau pulp mill, woodyard and utilities will continue to operate uninterrupted on a 24 hour, 7 day a week schedule. It is important to point out that PM 1 and PM 2 produce primarily specialty and value-added papers. The size and capabilities of these two paper machines, along with integrated nature of the mill, make them competitive and well suited for continued success in these markets. Over the last five years the mill has worked hard and qualified propriety specialty papers on these machines. Also manufactured on PM 1 and PM 2 are Flambeau’s other value-added papers such as Torchglow and Glacier Opaque branded papers, custom FDA compliant papers, fluorescent colored papers, wet-strength papers, saturating base stocks, deeply colored papers, watercolor papers, book papers, endleaf papers, lightweight offset papers, converting and drawing stocks. Paper grades historically produced on PM 3 such as Offset Papers and Laser Bond papers will not be part of the productive capacity of FRP as we proceed forward. We will work in concert with you and communicate the status of pending orders and shipments.

Production in the Vallvik Mill has been affected by an unplanned shutdown due to disturbances in the bleaching plant and the recovery boiler. Repair work is underway and normal production is scheduled for Wednesday 9 May. The shutdown represents an estimated production loss of about 6,000 tonnes corresponding to approximately 6 percent of the Group's total planned production for the quarter.