Borregaard — Call Transcript 2026

Investor relations at Borregaard. I'm joined today by CFO Per Bjarne Lyngstad, and we are broadcasting live from the biorefinery in Norway. Here is the agenda for today's call. First, outlook from the latest quarterly report. Secondly, currency and commodity input based on public data. Last, a Q&A session. Participants are welcome to submit questions via the chat during the call. I will now hand over to Per Bjarne, who will present the key points from the outlook communicated in the Q1 report. Thank you, Pål Espen, and good afternoon, everyone. I will start with reiterating the key points from the outlook for both the full year and the Q2 of 2026, and when relevant, refer to questions and comments on the outlook given in the Q&A session at the webcast we held for theQ1 on the April 29th. I will start with the BioSolutions, where we reiterated our expected full year sales volume of about 340,000 tons. The Q2 sales volume is expected to be around 90,000 tons, in line with what we had in the Q2 in 2025, but with a less favorable product mix this year. We got several questions regarding BioSolutions at the webcast. The first one was about how confident we are that the weaknesses in agri and batteries are temporary. We read the current picture as a reaction to the geopolitical situation, intensified by the war in Iran, which has also created a broader uncertainty. We also see that this drives a de-stocking in the value chain. We have no indication from the market and customers that there is a structural change in demand. Customers are keeping up their forecasts for the year. As such, we see this as a situation where customers are taking a cautious wait and see approach. That means that they currently are buying less, using what they have in inventory. The second question was about the mix in BioSolutions in the Q2. Should we expect similar trends for mix and ASP in BioSolutions as in the Q1? The Q2 last year was a very strong quarter for the specialties. In the Q1, we just saw the first consequences of the outbreak of the Iranian war. The consequence from the war is definitely going to impact the Q2, and in particular, we see that the Asian market is impacted more than others. We also see the agri market in general and India in particular being impacted. We expect the product mix in the Q2 to be similar to what we saw in the Q1. The next question was related to agri sales. Is there a risk that higher fertilizer prices affect Borregaard's agri sales negatively? We think it's still difficult to see exactly what's going to be the outcome of the current situation. We know fertilizer prices have increased and farmers are being hit by this. Our customers that are selling plant protection and plant nutrition products are looking at the impact on their own input cost factors. On the other hand, we have products that actually makes the farmers able to use less fertilizer. Therefore, we think we will see mixed impacts. The net impact is difficult to estimate, but we think there will also be opportunities coming out of this, especially in the longer term. For the time being, we see a temporary situation where there's a wait and see attitude and where customers are deciding how to approach the situation. The next question was also related to agri. Petrochem-based products have surged in price, so have fertilizers. This should favor both price and volumes of Borregaard's agri-based portfolio. When can we expect to see effect of this? Again, timing is difficult. Short term, we think sales is somewhat reduced due to the uncertainty, and customers are using the situation as an opportunity to reduce inventories. Longer term, this may offer opportunities both for additional business and also to do price adjustments upwards, and definitely where we are replacing synthetic products. Turning to the outlook for BioMaterials, where we reiterated our expected full year sales volume to be in the range of 155,000-160,000 tons, significantly above the 146,000 tons in 2025. We also reiterated that the sales volume of highly specialized grades is expected to be slightly above the 2025 level. The average sales price in sales currency is expected to be three percent-four percent lower in the first half of 2026 compared with the second half of 2025, partly due to mix. The second quarter sales volume in BioMaterials is expected to be in the range of 40,000-42,000 tons. There are two questions regarding BioMaterials outlook for volume and prices at the webcast. The first was related to RYAM and BioMaterials. RYAM guides for 18% higher ASP for speciality cellulose for 85% of its volume in 2026, and even more price increases for the remaining 15%. How should we think about the ASP in the second half when you have flushed out the lower grades from the production hiccups last year? As communicated earlier, we have locked in the major part of our cellulose business for 2026. We have some flexibility on a limited part of the volume. We think the main impact here will be when we go into 2027. RYAM's price increases may also create some opportunities in the market, where we will take those as we see them coming. The second question was related to construction volume in BioMaterials. Borregaard highlighted more sales to the construction segment in the Q1. Is this structural or reallocation of the lower grades sold in the quarter? In the Q4 report for 2025, we talked about the more intense competition in the construction part of the business in cellulose ethers, and that we had done some selective price adjustments. The increased sales into construction are reflecting also that our selective price adjustments have been working out well, and that we are gaining both business and market share in that part of the business. The final outcome of the U.S. anti-dumping case may also affect several speciality cellulose markets. In May, the U.S. Department of Commerce announced the preliminary dumping rates for Borregaard and the Brazilian company Bracell. For Borregaard, the preliminary rate was set at 6.54%, while Bracell got a rate of 7.20%. The final determination of the dumping rates is expected on or around the October 7th 2026. If the final dumping rates end up at or close to the preliminary determination, our take is that U.S. customers will resume buying specialty cellulose from Borregaard to secure competition in the U.S. market. This level of dumping rates might even open up new opportunities in the U.S. market for Borregaard. Moving on to the outlook for Fine Chemicals, where sales prices for bioethanol continue to be expected largely in line with the levels we saw in 2025. The sales volume for fine chemical intermediates is expected to increase compared with 2025. For fine chemical intermediates, we just want to remind you that delivery patterns and product mix may vary from quarter to quarter. To the outlook and the development in costs. Wood costs in the first half of 2026 is expected to be around 15% lower than in the first half of 2025. The Middle East conflict is expected to impact our energy, logistics, and chemical costs negatively. The net cost impact from raw materials, energy, and logistics is estimated to be negative by about NOK 40 million-NOK 60 million, not compared with the Q2 of 2025. In addition, general cost increases or inflation will affect our cost level. As to energy cost, remember that energy consumption in Borregaard is normally higher during the winter and lower in the summer season. About 80% of Borregaard's energy consumption is on long-term contracts or hedged. For the rest, we are exposed to spot prices, we have flexibility to switch between natural gas and electricity. For natural gas, we have a one-month delay compared with the market price. Electricity prices in Norway so far in the Q2 have on average been significantly above last year's prices, about 75% above. Less snow and less water in reservoirs are the main reasons for the high spot prices for electricity. Delivered price for natural gas have also been significantly higher, even more than 90% higher than last year, taking the one-month delay into consideration. Natural gas or LNG prices in Europe are, of course, impacted by the war in the Middle East. In total, spot prices on energy will have a negative impact in the Q2, more or less in line with our estimate from the Q1 presentation. There were several questions regarding costs. The first question was about spruce pulp prices, which are now down 26% from the peak. How are negotiations going for the Q2? As of now, the negotiations for the second half of 2026 have started, will not be finalized before the end of June. The expectation is still that prices should come down somewhat. The second question was related to the Middle East and raw material costs. Are current spot prices for gas and sulfur fair, do Borregaard still benefit from lags of early sourcing in the cost guidance figure? Borregaard has a one-month lag on natural gas, for the rest, we are more or less at the present level unless we have contracted volume for several months. Sulfur prices are on the rise and on a steep rise. Caustic soda is relatively stable, we have seen some increase in the Q2. We were also asked to split the NOK 40 million-NOK 60 million higher cost year-over-year in the Q2 on the different items. Since it's a net amount, you have to take into consideration the 15% reduction in wood price in the first half, which is about NOK 30 million positive per quarter. That means that the other elements are NOK 70 million-NOK 90 million negative, of which energy is the largest element. A part of the cost increase is also related to increased cost for sulfur and to a lesser degree, caustic. In addition, we see increased logistical costs. The next question was also related to costs. We were asked to elaborate on the targeted cost measures to address cost development. When might these measures start to take effect? Borregaard has initiated a cost reduction project. We will come back with more details, but we'll for sure implement cost discipline measures, be more restrictive on recruitments, and the use of external consultants, among other things. We will also look more at the structure and initiatives we are driving, and in general, take a more restrictive approach to get costs down. The next question was related to price hikes and surcharges. Are price increases and surcharges also something you will consider? And our answer was that yes, surcharges and price increases are something we consider. Borregaard implemented surcharges in 2022, but the situation is a bit different now compared with then, since the overall market environment has changed. At the end of the outlook presentation, we reminded you about the uncertainty in the global economy, particularly related to wars, conflicts, and tariffs, which may impact Borregaard's markets, cost base, and currencies. Borregaard are implemented targeted measures to address the cost development. While the conflict in the Middle East is affecting certain parts of our markets and customers, we believe the situation will represent a longer-term opportunity for Borregaard's bio-based products. Borregaard's diversified portfolio and broad customer base has a proven track record of providing resilience in times like this. We believe that this will prove its strength also in a period like we are seeing now. Having completed the outlook and questions from the Q1 presentation, we will point to one more element which will have an impact on 2026 results. Borregaard has a hedging strategy that delays the impact of changes in currency rates. Using currency rates as of the April 28th, the net currency impact for the full year of 2026 was estimated to be about zero compared to 2025. The corresponding impact for the Q2 of 2026 was estimated to be positive by about NOK 10 million, compared with the Q2 of 2025. So far in the Q2, the Norwegian kroner has strengthened by about four percent compared with the Q1 of 2026 using Borregaard's currency basket. Compared with the Q2 last year, the Norwegian kroner has strengthened seven percent-eight percent. If the present currency rates continue the rest of the month, the net currency impact in the Q2 compared with the second quarter last year will more or less be in line with the +NOK 10 million we estimated at the Q1 webcast on April 29th. With today's rates, where the Norwegian kroner has weakened quite a lot over the last week. The net currency impact for the full year of 2026 is expected to be NOK 10 million-NOK 15 million higher than the zero impact we estimated in late April. I will now hand over to Pål Espen, who will lead the Q&A session with questions asked in the chat function of this webcast. Thank you, Per Bjarne. We will now open a Q&A session. Please submit your questions via the chat function. We will wait some seconds to make sure we have received all questions, as there is a delay on the web. The first one is from Magnus Rasmussen at SEB. How much is the extra NOK 100 million convertible Alginor comes from Borregaard? Roughly half? Yeah, roughly half, or to be precise, about NOK 56 million out of the NOK 100 million, which relates to our share compared to the share of the three largest shareholders. That seems to conclude today's Q&A session. Thank you for joining the Pre-close call, and thank you for your interest in Borregaard. As a reminder, this call marks the start of the silence period. There we have another one, finally here, from Magnus again. How much has to date total been invested in Alginor? We have invested around NOK 600 million so far, partly in equity and partly in convertible loans. Try one more time. That seems to conclude today's Q&A session. Thank you for joining the Pre-close call, and thank you for your interest in Borregaard. As a reminder, this call marks the start of our silent period. We look forward to the next update. Thank you and goodbye.

Speaker 2: Investor relations at Borregaard. I'm joined today by CFO Per Bjarne Lyngstad, and we are broadcasting live from the biorefinery in Norway. Here is the agenda for today's call. First, outlook from the latest quarterly report. Secondly, currency and commodity input based on public data. Last, a Q&A session. Participants are welcome to submit questions via the chat during the call. I will now hand over to Per Bjarne, who will present the key points from the outlook communicated in the Q1 report. Investor relations at Borregaard. investor relations at borregaard I'm joined today by CFO Per Bjarne Lyngstad, and we are broadcasting live from the biorefinery in Norway. i'm joined today by cfo per bjarne lyngstad and we are broadcasting live from the biorefinery in norway Here is the agenda for today's call. here is the agenda for today's call First, outlook from the latest quarterly report. first outlook from the latest quarterly report Secondly, currency and commodity input based on public data. secondly currency and commodity input based on public data Last, a Q&A session. last a q&a session Participants are welcome to submit questions via the chat during the call. participants are welcome to submit questions via the chat during the call I will now hand over to Per Bjarne, who will present the key points from the outlook communicated in the Q1 report. i will now hand over to per bjarne who will present the key points from the outlook communicated in the q1 report

Speaker 1: Thank you, Pål Espen, and good afternoon, everyone. I will start with reiterating the key points from the outlook for both the full year and the Q2 of 2026, and when relevant, refer to questions and comments on the outlook given in the Q&A session at the webcast we held for theQ1 on the April 29th. I will start with the BioSolutions, where we reiterated our expected full year sales volume of about 340,000 tons. The Q2 sales volume is expected to be around 90,000 tons, in line with what we had in the Q2 in 2025, but with a less favorable product mix this year. We got several questions regarding BioSolutions at the webcast. The first one was about how confident we are that the weaknesses in agri and batteries are temporary. Thank you, Pål Espen , and good afternoon, everyone. thank you pål espen and good afternoon everyone I will start with reiterating the key points from the outlook for both the full year and the Q2 of 2026, and when relevant, refer to questions and comments on the outlook given in the Q&A session at the webcast we held for the Q1 on the April 29th . i will start with reiterating the key points from the outlook for both the full year and the q2 of 2026 and when relevant refer to questions and comments on the outlook given in the q&a session at the webcast we held for the q1 on the april 29th I will start with the BioSolutions, where we reiterated our expected full year sales volume of about 340,000 tons. i will start with the biosolutions where we reiterated our expected full year sales volume of about 340,000 tons The Q2 sales volume is expected to be around 90,000 tons, in line with what we had in the Q2 in 2025, but with a less favorable product mix this year. the q2 sales volume is expected to be around 90,000 tons in line with what we had in the q2 in 2025 but with a less favorable product mix this year We got several questions regarding BioSolutions at the webcast. we got several questions regarding biosolutions at the webcast The first one was about how confident we are that the weaknesses in agri and batteries are temporary. the first one was about how confident we are that the weaknesses in agri and batteries are temporary We read the current picture as a reaction to the geopolitical situation, intensified by the war in Iran, which has also created a broader uncertainty. We also see that this drives a de-stocking in the value chain. We have no indication from the market and customers that there is a structural change in demand. Customers are keeping up their forecasts for the year. As such, we see this as a situation where customers are taking a cautious wait and see approach. That means that they currently are buying less, using what they have in inventory. The second question was about the mix in BioSolutions in the Q2. Should we expect similar trends for mix and ASP in BioSolutions as in the Q1? The Q2 last year was a very strong quarter for the specialties. We read the current picture as a reaction to the geopolitical situation, intensified by the war in Iran, which has also created a broader uncertainty. we read the current picture as a reaction to the geopolitical situation intensified by the war in iran which has also created a broader uncertainty We also see that this drives a de-stocking in the value chain. we also see that this drives a de-stocking in the value chain We have no indication from the market and customers that there is a structural change in demand. we have no indication from the market and customers that there is a structural change in demand Customers are keeping up their forecasts for the year. customers are keeping up their forecasts for the year As such, we see this as a situation where customers are taking a cautious wait and see approach. as such we see this as a situation where customers are taking a cautious wait and see approach That means that they currently are buying less, using what they have in inventory. that means that they currently are buying less using what they have in inventory The second question was about the mix in BioSolutions in the Q2 . the second question was about the mix in biosolutions in the q2 Should we expect similar trends for mix and ASP in BioSolutions as in the Q1 ? should we expect similar trends for mix and asp in biosolutions as in the q1 The Q2 last year was a very strong quarter for the specialties. the q2 last year was a very strong quarter for the specialties In the Q1, we just saw the first consequences of the outbreak of the Iranian war. The consequence from the war is definitely going to impact the Q2, and in particular, we see that the Asian market is impacted more than others. We also see the agri market in general and India in particular being impacted. We expect the product mix in the Q2 to be similar to what we saw in the Q1. The next question was related to agri sales. Is there a risk that higher fertilizer prices affect Borregaard's agri sales negatively? We think it's still difficult to see exactly what's going to be the outcome of the current situation. We know fertilizer prices have increased and farmers are being hit by this. In the Q1 , we just saw the first consequences of the outbreak of the Iranian war. in the q1 we just saw the first consequences of the outbreak of the iranian war The consequence from the war is definitely going to impact the Q2 , and in particular, we see that the Asian market is impacted more than others. the consequence from the war is definitely going to impact the q2 and in particular we see that the asian market is impacted more than others We also see the agri market in general and India in particular being impacted. we also see the agri market in general and india in particular being impacted We expect the product mix in the Q2 to be similar to what we saw in the Q1 . we expect the product mix in the q2 to be similar to what we saw in the q1 The next question was related to agri sales. the next question was related to agri sales Is there a risk that higher fertilizer prices affect Borregaard's agri sales negatively? is there a risk that higher fertilizer prices affect borregaard's agri sales negatively We think it's still difficult to see exactly what's going to be the outcome of the current situation. we think it's still difficult to see exactly what's going to be the outcome of the current situation We know fertilizer prices have increased and farmers are being hit by this. we know fertilizer prices have increased and farmers are being hit by this Our customers that are selling plant protection and plant nutrition products are looking at the impact on their own input cost factors. On the other hand, we have products that actually makes the farmers able to use less fertilizer. Therefore, we think we will see mixed impacts. The net impact is difficult to estimate, but we think there will also be opportunities coming out of this, especially in the longer term. For the time being, we see a temporary situation where there's a wait and see attitude and where customers are deciding how to approach the situation. The next question was also related to agri. Petrochem-based products have surged in price, so have fertilizers. This should favor both price and volumes of Borregaard's agri-based portfolio. When can we expect to see effect of this? Again, timing is difficult. Our customers that are selling plant protection and plant nutrition products are looking at the impact on their own input cost factors. our customers that are selling plant protection and plant nutrition products are looking at the impact on their own input cost factors On the other hand, we have products that actually makes the farmers able to use less fertilizer. on the other hand we have products that actually makes the farmers able to use less fertilizer Therefore, we think we will see mixed impacts. therefore we think we will see mixed impacts The net impact is difficult to estimate, but we think there will also be opportunities coming out of this, especially in the longer term. the net impact is difficult to estimate but we think there will also be opportunities coming out of this especially in the longer term For the time being, we see a temporary situation where there's a wait and see attitude and where customers are deciding how to approach the situation. for the time being we see a temporary situation where there's a wait and see attitude and where customers are deciding how to approach the situation The next question was also related to agri. the next question was also related to agri Petrochem-based products have surged in price, so have fertilizers. petrochem-based products have surged in price so have fertilizers This should favor both price and volumes of Borregaard's agri-based portfolio. this should favor both price and volumes of borregaard's agri-based portfolio When can we expect to see effect of this? when can we expect to see effect of this Again, timing is difficult. again timing is difficult Short term, we think sales is somewhat reduced due to the uncertainty, and customers are using the situation as an opportunity to reduce inventories. Longer term, this may offer opportunities both for additional business and also to do price adjustments upwards, and definitely where we are replacing synthetic products. Turning to the outlook for BioMaterials, where we reiterated our expected full year sales volume to be in the range of 155,000-160,000 tons, significantly above the 146,000 tons in 2025. We also reiterated that the sales volume of highly specialized grades is expected to be slightly above the 2025 level. The average sales price in sales currency is expected to be three percent-four percent lower in the first half of 2026 compared with the second half of 2025, partly due to mix. Short term, we think sales is somewhat reduced due to the uncertainty, and customers are using the situation as an opportunity to reduce inventories. short term we think sales is somewhat reduced due to the uncertainty and customers are using the situation as an opportunity to reduce inventories Longer term, this may offer opportunities both for additional business and also to do price adjustments upwards, and definitely where we are replacing synthetic products. longer term this may offer opportunities both for additional business and also to do price adjustments upwards and definitely where we are replacing synthetic products Turning to the outlook for BioMaterials, where we reiterated our expected full year sales volume to be in the range of 155,000-160,000 tons, significantly above the 146,000 tons in 2025. turning to the outlook for biomaterials where we reiterated our expected full year sales volume to be in the range of 155,000-160,000 tons significantly above the 146,000 tons in 2025 We also reiterated that the sales volume of highly specialized grades is expected to be slightly above the 2025 level. we also reiterated that the sales volume of highly specialized grades is expected to be slightly above the 2025 level The average sales price in sales currency is expected to be three percent-four percent lower in the first half of 2026 compared with the second half of 2025, partly due to mix. the average sales price in sales currency is expected to be three percent-four percent lower in the first half of 2026 compared with the second half of 2025 partly due to mix The second quarter sales volume in BioMaterials is expected to be in the range of 40,000-42,000 tons. There are two questions regarding BioMaterials outlook for volume and prices at the webcast. The first was related to RYAM and BioMaterials. RYAM guides for 18% higher ASP for speciality cellulose for 85% of its volume in 2026, and even more price increases for the remaining 15%. How should we think about the ASP in the second half when you have flushed out the lower grades from the production hiccups last year? As communicated earlier, we have locked in the major part of our cellulose business for 2026. We have some flexibility on a limited part of the volume. We think the main impact here will be when we go into 2027. The second quarter sales volume in BioMaterials is expected to be in the range of 40,000-42,000 tons. the second quarter sales volume in biomaterials is expected to be in the range of 40,000-42,000 tons There are two questions regarding BioMaterials outlook for volume and prices at the webcast. there are two questions regarding biomaterials outlook for volume and prices at the webcast The first was related to RYAM and BioMaterials. the first was related to ryam and biomaterials RYAM guides for 18% higher ASP for speciality cellulose for 85% of its volume in 2026, and even more price increases for the remaining 15%. ryam guides for 18% higher asp for speciality cellulose for 85% of its volume in 2026 and even more price increases for the remaining 15% How should we think about the ASP in the second half when you have flushed out the lower grades from the production hiccups last year? how should we think about the asp in the second half when you have flushed out the lower grades from the production hiccups last year As communicated earlier, we have locked in the major part of our cellulose business for 2026. as communicated earlier we have locked in the major part of our cellulose business for 2026 We have some flexibility on a limited part of the volume. we have some flexibility on a limited part of the volume We think the main impact here will be when we go into 2027. we think the main impact here will be when we go into 2027 RYAM's price increases may also create some opportunities in the market, where we will take those as we see them coming. The second question was related to construction volume in BioMaterials. Borregaard highlighted more sales to the construction segment in the Q1. Is this structural or reallocation of the lower grades sold in the quarter? In the Q4 report for 2025, we talked about the more intense competition in the construction part of the business in cellulose ethers, and that we had done some selective price adjustments. The increased sales into construction are reflecting also that our selective price adjustments have been working out well, and that we are gaining both business and market share in that part of the business. The final outcome of the U.S. anti-dumping case may also affect several speciality cellulose markets. RYAM's price increases may also create some opportunities in the market, where we will take those as we see them coming. ryam's price increases may also create some opportunities in the market where we will take those as we see them coming The second question was related to construction volume in BioMaterials. the second question was related to construction volume in biomaterials Borregaard highlighted more sales to the construction segment in the Q1 . borregaard highlighted more sales to the construction segment in the q1 Is this structural or reallocation of the lower grades sold in the quarter? is this structural or reallocation of the lower grades sold in the quarter In the Q4 report for 2025, we talked about the more intense competition in the construction part of the business in cellulose ethers, and that we had done some selective price adjustments. in the q4 report for 2025 we talked about the more intense competition in the construction part of the business in cellulose ethers and that we had done some selective price adjustments The increased sales into construction are reflecting also that our selective price adjustments have been working out well, and that we are gaining both business and market share in that part of the business. the increased sales into construction are reflecting also that our selective price adjustments have been working out well and that we are gaining both business and market share in that part of the business The final outcome of the U.S. anti-dumping case may also affect several speciality cellulose markets. the final outcome of the u.s anti-dumping case may also affect several speciality cellulose markets In May, the U.S. Department of Commerce announced the preliminary dumping rates for Borregaard and the Brazilian company Bracell. For Borregaard, the preliminary rate was set at 6.54%, while Bracell got a rate of 7.20%. The final determination of the dumping rates is expected on or around the October 7th 2026. If the final dumping rates end up at or close to the preliminary determination, our take is that U.S. customers will resume buying specialty cellulose from Borregaard to secure competition in the U.S. market. This level of dumping rates might even open up new opportunities in the U.S. market for Borregaard. Moving on to the outlook for Fine Chemicals, where sales prices for bioethanol continue to be expected largely in line with the levels we saw in 2025. The sales volume for fine chemical intermediates is expected to increase compared with 2025. In May, the U.S. in may the u.s Department of Commerce announced the preliminary dumping rates for Borregaard and the Brazilian company Bracell. department of commerce announced the preliminary dumping rates for borregaard and the brazilian company bracell For Borregaard, the preliminary rate was set at 6.54%, while Bracell got a rate of 7.20%. for borregaard the preliminary rate was set at 6.54% while bracell got a rate of 7.20% The final determination of the dumping rates is expected on or around the October 7th 2026. the final determination of the dumping rates is expected on or around the october 7th 2026 If the final dumping rates end up at or close to the preliminary determination, our take is that U.S. customers will resume buying specialty cellulose from Borregaard to secure competition in the U.S. market. if the final dumping rates end up at or close to the preliminary determination our take is that u.s customers will resume buying specialty cellulose from borregaard to secure competition in the u.s market This level of dumping rates might even open up new opportunities in the U.S. market for Borregaard. this level of dumping rates might even open up new opportunities in the u.s market for borregaard Moving on to the outlook for Fine Chemicals, where sales prices for bioethanol continue to be expected largely in line with the levels we saw in 2025. moving on to the outlook for fine chemicals where sales prices for bioethanol continue to be expected largely in line with the levels we saw in 2025 The sales volume for fine chemical intermediates is expected to increase compared with 2025. the sales volume for fine chemical intermediates is expected to increase compared with 2025 For fine chemical intermediates, we just want to remind you that delivery patterns and product mix may vary from quarter to quarter. To the outlook and the development in costs. Wood costs in the first half of 2026 is expected to be around 15% lower than in the first half of 2025. The Middle East conflict is expected to impact our energy, logistics, and chemical costs negatively. The net cost impact from raw materials, energy, and logistics is estimated to be negative by about NOK 40 million-NOK 60 million, not compared with the Q2 of 2025. In addition, general cost increases or inflation will affect our cost level. As to energy cost, remember that energy consumption in Borregaard is normally higher during the winter and lower in the summer season. About 80% of Borregaard's energy consumption is on long-term contracts or hedged. For fine chemical intermediates, we just want to remind you that delivery patterns and product mix may vary from quarter to quarter. for fine chemical intermediates we just want to remind you that delivery patterns and product mix may vary from quarter to quarter To the outlook and the development in costs. to the outlook and the development in costs Wood costs in the first half of 2026 is expected to be around 15% lower than in the first half of 2025. wood costs in the first half of 2026 is expected to be around 15% lower than in the first half of 2025 The Middle East conflict is expected to impact our energy, logistics, and chemical costs negatively. the middle east conflict is expected to impact our energy logistics and chemical costs negatively The net cost impact from raw materials, energy, and logistics is estimated to be negative by about NOK 40 million-NOK 60 million, not compared with the Q2 of 2025. the net cost impact from raw materials energy and logistics is estimated to be negative by about nok 40 million-nok 60 million not compared with the q2 of 2025 In addition, general cost increases or inflation will affect our cost level. in addition general cost increases or inflation will affect our cost level As to energy cost, remember that energy consumption in Borregaard is normally higher during the winter and lower in the summer season. as to energy cost remember that energy consumption in borregaard is normally higher during the winter and lower in the summer season About 80% of Borregaard's energy consumption is on long-term contracts or hedged. about 80% of borregaard's energy consumption is on long-term contracts or hedged For the rest, we are exposed to spot prices, we have flexibility to switch between natural gas and electricity. For natural gas, we have a one-month delay compared with the market price. Electricity prices in Norway so far in the Q2 have on average been significantly above last year's prices, about 75% above. Less snow and less water in reservoirs are the main reasons for the high spot prices for electricity. Delivered price for natural gas have also been significantly higher, even more than 90% higher than last year, taking the one-month delay into consideration. Natural gas or LNG prices in Europe are, of course, impacted by the war in the Middle East. In total, spot prices on energy will have a negative impact in the Q2, more or less in line with our estimate from the Q1 presentation. There were several questions regarding costs. For the rest, we are exposed to spot prices, we have flexibility to switch between natural gas and electricity. for the rest we are exposed to spot prices we have flexibility to switch between natural gas and electricity For natural gas, we have a one-month delay compared with the market price. for natural gas we have a one-month delay compared with the market price Electricity prices in Norway so far in the Q2 have on average been significantly above last year's prices, about 75% above. electricity prices in norway so far in the q2 have on average been significantly above last year's prices about 75% above Less snow and less water in reservoirs are the main reasons for the high spot prices for electricity. less snow and less water in reservoirs are the main reasons for the high spot prices for electricity Delivered price for natural gas have also been significantly higher, even more than 90% higher than last year, taking the one-month delay into consideration. delivered price for natural gas have also been significantly higher even more than 90% higher than last year taking the one-month delay into consideration Natural gas or LNG prices in Europe are, of course, impacted by the war in the Middle East. natural gas or lng prices in europe are of course impacted by the war in the middle east In total, spot prices on energy will have a negative impact in the Q2 , more or less in line with our estimate from the Q1 presentation. in total spot prices on energy will have a negative impact in the q2 more or less in line with our estimate from the q1 presentation There were several questions regarding costs. there were several questions regarding costs The first question was about spruce pulp prices, which are now down 26% from the peak. How are negotiations going for the Q2? As of now, the negotiations for the second half of 2026 have started, will not be finalized before the end of June. The expectation is still that prices should come down somewhat. The second question was related to the Middle East and raw material costs. Are current spot prices for gas and sulfur fair, do Borregaard still benefit from lags of early sourcing in the cost guidance figure? Borregaard has a one-month lag on natural gas, for the rest, we are more or less at the present level unless we have contracted volume for several months. Sulfur prices are on the rise and on a steep rise. Caustic soda is relatively stable, we have seen some increase in the Q2. The first question was about spruce pulp prices, which are now down 26% from the peak. the first question was about spruce pulp prices which are now down 26% from the peak How are negotiations going for the Q2 ? how are negotiations going for the q2 As of now, the negotiations for the second half of 2026 have started, will not be finalized before the end of June. as of now the negotiations for the second half of 2026 have started will not be finalized before the end of june The expectation is still that prices should come down somewhat. the expectation is still that prices should come down somewhat The second question was related to the Middle East and raw material costs. the second question was related to the middle east and raw material costs Are current spot prices for gas and sulfur fair, do Borregaard still benefit from lags of early sourcing in the cost guidance figure? are current spot prices for gas and sulfur fair do borregaard still benefit from lags of early sourcing in the cost guidance figure Borregaard has a one-month lag on natural gas, for the rest, we are more or less at the present level unless we have contracted volume for several months. borregaard has a one-month lag on natural gas for the rest we are more or less at the present level unless we have contracted volume for several months Sulfur prices are on the rise and on a steep rise. sulfur prices are on the rise and on a steep rise Caustic soda is relatively stable, we have seen some increase in the Q2 . caustic soda is relatively stable we have seen some increase in the q2 We were also asked to split the NOK 40 million-NOK 60 million higher cost year-over-year in the Q2 on the different items. Since it's a net amount, you have to take into consideration the 15% reduction in wood price in the first half, which is about NOK 30 million positive per quarter. That means that the other elements are NOK 70 million-NOK 90 million negative, of which energy is the largest element. A part of the cost increase is also related to increased cost for sulfur and to a lesser degree, caustic. In addition, we see increased logistical costs. The next question was also related to costs. We were asked to elaborate on the targeted cost measures to address cost development. When might these measures start to take effect? Borregaard has initiated a cost reduction project. We were also asked to split the NOK 40 million-NOK 60 million higher cost year-over-year in the Q2 on the different items. we were also asked to split the nok 40 million-nok 60 million higher cost year-over-year in the q2 on the different items Since it's a net amount, you have to take into consideration the 15% reduction in wood price in the first half, which is about NOK 30 million positive per quarter. since it's a net amount you have to take into consideration the 15% reduction in wood price in the first half which is about nok 30 million positive per quarter That means that the other elements are NOK 70 million-NOK 90 million negative, of which energy is the largest element. that means that the other elements are nok 70 million-nok 90 million negative of which energy is the largest element A part of the cost increase is also related to increased cost for sulfur and to a lesser degree, caustic. a part of the cost increase is also related to increased cost for sulfur and to a lesser degree caustic In addition, we see increased logistical costs. in addition we see increased logistical costs The next question was also related to costs. the next question was also related to costs We were asked to elaborate on the targeted cost measures to address cost development. we were asked to elaborate on the targeted cost measures to address cost development When might these measures start to take effect? when might these measures start to take effect Borregaard has initiated a cost reduction project. borregaard has initiated a cost reduction project We will come back with more details, but we'll for sure implement cost discipline measures, be more restrictive on recruitments, and the use of external consultants, among other things. We will also look more at the structure and initiatives we are driving, and in general, take a more restrictive approach to get costs down. The next question was related to price hikes and surcharges. Are price increases and surcharges also something you will consider? And our answer was that yes, surcharges and price increases are something we consider. Borregaard implemented surcharges in 2022, but the situation is a bit different now compared with then, since the overall market environment has changed. At the end of the outlook presentation, we reminded you about the uncertainty in the global economy, particularly related to wars, conflicts, and tariffs, which may impact Borregaard's markets, cost base, and currencies. We will come back with more details, but we'll for sure implement cost discipline measures, be more restrictive on recruitments, and the use of external consultants, among other things. we will come back with more details but we'll for sure implement cost discipline measures be more restrictive on recruitments and the use of external consultants among other things We will also look more at the structure and initiatives we are driving, and in general, take a more restrictive approach to get costs down. we will also look more at the structure and initiatives we are driving and in general take a more restrictive approach to get costs down The next question was related to price hikes and surcharges. the next question was related to price hikes and surcharges Are price increases and surcharges also something you will consider? are price increases and surcharges also something you will consider And our answer was that yes, surcharges and price increases are something we consider. and our answer was that yes surcharges and price increases are something we consider Borregaard implemented surcharges in 2022, but the situation is a bit different now compared with then, since the overall market environment has changed. borregaard implemented surcharges in 2022 but the situation is a bit different now compared with then since the overall market environment has changed At the end of the outlook presentation, we reminded you about the uncertainty in the global economy, particularly related to wars, conflicts, and tariffs, which may impact Borregaard's markets, cost base, and currencies. at the end of the outlook presentation we reminded you about the uncertainty in the global economy particularly related to wars conflicts and tariffs which may impact borregaard's markets cost base and currencies Borregaard are implemented targeted measures to address the cost development. While the conflict in the Middle East is affecting certain parts of our markets and customers, we believe the situation will represent a longer-term opportunity for Borregaard's bio-based products. Borregaard's diversified portfolio and broad customer base has a proven track record of providing resilience in times like this. We believe that this will prove its strength also in a period like we are seeing now. Having completed the outlook and questions from the Q1 presentation, we will point to one more element which will have an impact on 2026 results. Borregaard has a hedging strategy that delays the impact of changes in currency rates. Using currency rates as of the April 28th, the net currency impact for the full year of 2026 was estimated to be about zero compared to 2025. Borregaard are implemented targeted measures to address the cost development. borregaard are implemented targeted measures to address the cost development While the conflict in the Middle East is affecting certain parts of our markets and customers, we believe the situation will represent a longer-term opportunity for Borregaard's bio-based products. while the conflict in the middle east is affecting certain parts of our markets and customers we believe the situation will represent a longer-term opportunity for borregaard's bio-based products Borregaard's diversified portfolio and broad customer base has a proven track record of providing resilience in times like this. borregaard's diversified portfolio and broad customer base has a proven track record of providing resilience in times like this We believe that this will prove its strength also in a period like we are seeing now. we believe that this will prove its strength also in a period like we are seeing now Having completed the outlook and questions from the Q1 presentation, we will point to one more element which will have an impact on 2026 results. having completed the outlook and questions from the q1 presentation we will point to one more element which will have an impact on 2026 results Borregaard has a hedging strategy that delays the impact of changes in currency rates. borregaard has a hedging strategy that delays the impact of changes in currency rates Using currency rates as of the April 28th , the net currency impact for the full year of 2026 was estimated to be about zero compared to 2025. using currency rates as of the april 28th the net currency impact for the full year of 2026 was estimated to be about zero compared to 2025 The corresponding impact for the Q2 of 2026 was estimated to be positive by about NOK 10 million, compared with the Q2 of 2025. So far in the Q2, the Norwegian kroner has strengthened by about four percent compared with the Q1 of 2026 using Borregaard's currency basket. Compared with the Q2 last year, the Norwegian kroner has strengthened seven percent-eight percent. If the present currency rates continue the rest of the month, the net currency impact in the Q2 compared with the second quarter last year will more or less be in line with the +NOK 10 million we estimated at the Q1 webcast on April 29th. The corresponding impact for the Q2 of 2026 was estimated to be positive by about NOK 10 million, compared with the Q2 of 2025. the corresponding impact for the q2 of 2026 was estimated to be positive by about nok 10 million compared with the q2 of 2025 So far in the Q2 , the Norwegian kroner has strengthened by about four percent compared with the Q1 of 2026 using Borregaard's currency basket. so far in the q2 the norwegian kroner has strengthened by about four percent compared with the q1 of 2026 using borregaard's currency basket Compared with the Q2 last year, the Norwegian kroner has strengthened seven percent -eight percent . compared with the q2 last year the norwegian kroner has strengthened seven percent -eight percent If the present currency rates continue the rest of the month, the net currency impact in the Q2 compared with the second quarter last year will more or less be in line with the +NOK 10 million we estimated at the Q1 webcast on April 29th . if the present currency rates continue the rest of the month the net currency impact in the q2 compared with the second quarter last year will more or less be in line with the +nok 10 million we estimated at the q1 webcast on april 29th With today's rates, where the Norwegian kroner has weakened quite a lot over the last week. The net currency impact for the full year of 2026 is expected to be NOK 10 million-NOK 15 million higher than the zero impact we estimated in late April. I will now hand over to Pål Espen, who will lead the Q&A session with questions asked in the chat function of this webcast. With today's rates, where the Norwegian kroner has weakened quite a lot over the last week. with today's rates where the norwegian kroner has weakened quite a lot over the last week The net currency impact for the full year of 2026 is expected to be NOK 10 million-NOK 15 million higher than the zero impact we estimated in late April. the net currency impact for the full year of 2026 is expected to be nok 10 million-nok 15 million higher than the zero impact we estimated in late april I will now hand over to Pål Espen, who will lead the Q&A session with questions asked in the chat function of this webcast. i will now hand over to pål espen who will lead the q&a session with questions asked in the chat function of this webcast

Speaker 2: Thank you, Per Bjarne. We will now open a Q&A session. Please submit your questions via the chat function. We will wait some seconds to make sure we have received all questions, as there is a delay on the web. The first one is from Magnus Rasmussen at SEB. How much is the extra NOK 100 million convertible Alginor comes from Borregaard? Roughly half? Thank you, Per Bjarne. thank you per bjarne We will now open a Q&A session. we will now open a q&a session Please submit your questions via the chat function. please submit your questions via the chat function We will wait some seconds to make sure we have received all questions, as there is a delay on the web. we will wait some seconds to make sure we have received all questions as there is a delay on the web The first one is from Magnus Rasmussen at SEB. the first one is from magnus rasmussen at seb How much is the extra NOK 100 million convertible Alginor comes from Borregaard? how much is the extra nok 100 million convertible alginor comes from borregaard Roughly half? roughly half

Speaker 1: Yeah, roughly half, or to be precise, about NOK 56 million out of the NOK 100 million, which relates to our share compared to the share of the three largest shareholders. Yeah, roughly half, or to be precise, about NOK 56 million out of the NOK 100 million, which relates to our share compared to the share of the three largest shareholders. yeah roughly half or to be precise about nok 56 million out of the nok 100 million which relates to our share compared to the share of the three largest shareholders

Speaker 2: That seems to conclude today's Q&A session. Thank you for joining the Pre-close call, and thank you for your interest in Borregaard. As a reminder, this call marks the start of the silence period. There we have another one, finally here, from Magnus again. How much has to date total been invested in Alginor? That seems to conclude today's Q&A session. that seems to conclude today's q&a session Thank you for joining the Pre-close call, and thank you for your interest in Borregaard. thank you for joining the pre-close call and thank you for your interest in borregaard As a reminder, this call marks the start of the silence period. as a reminder this call marks the start of the silence period There we have another one, finally here, from Magnus again. there we have another one finally here from magnus again How much has to date total been invested in Alginor? how much has to date total been invested in alginor

Speaker 1: We have invested around NOK 600 million so far, partly in equity and partly in convertible loans. We have invested around NOK 600 million so far, partly in equity and partly in convertible loans. we have invested around nok 600 million so far partly in equity and partly in convertible loans

Speaker 2: Try one more time. That seems to conclude today's Q&A session. Thank you for joining the Pre-close call, and thank you for your interest in Borregaard. As a reminder, this call marks the start of our silent period. We look forward to the next update. Thank you and goodbye. Try one more time. try one more time That seems to conclude today's Q&A session. that seems to conclude today's q&a session Thank you for joining the Pre-close call, and thank you for your interest in Borregaard. thank you for joining the pre-close call and thank you for your interest in borregaard As a reminder, this call marks the start of our silent period. as a reminder this call marks the start of our silent period We look forward to the next update. we look forward to the next update Thank you and goodbye. thank you and goodbye