Borregaard Stock

Good morning, and a warm welcome to this Capital Markets Day for Borregaard. My name is Tom Erik Foss-Jacobsen, and I'm the CEO of the company. I joined Borregaard in 1996 and have been a member of group executive management since 2007. During my career, I held a range of commercial and leadership positions, leading our Specialty Cellulose business from 2007 to 2019 and our BioSolutions business from 2019 to 2025, before becoming CEO in August 2025. Having spent nearly 3 decades with Borregaard, I feel privileged to have been part of the journey that has transformed the company into a global leader in sustainable specialty chemicals.

Most importantly, I have had the opportunity to work alongside many talented colleagues who made that transformation possible. Today, we look forward to sharing how we will continue to build on that strategy and create greater value in the years ahead. Let me briefly walk you through today's agenda. We have structured today into 2 parts with a Q&A session following each part. In the first part, we will start with the overall Borregaard story and how we intend to continue advancing our specialization strategy and delivering greater value. We will then focus on BioSolutions, including our technology platform, innovation pipeline and growth opportunities in agriculture and how we're winning new customers and entering new markets.

In the second part, we will turn to BioMaterials and our manufacturing platform and our financial ambitions for profitable growth towards 2030. Throughout the day, you will meet a broad Borregaard team and hear directly from several of the leaders responsible for executing our strategy. Among them is our Business Director, Agriculture, Eduardo Pereira, who is presenting at CMD for the first time. Agriculture has grown significantly in recent years and represents an attractive opportunity for future growth. Before we begin, just a quick reminder to those of you watching the webcast live that you're welcome to submit questions at any time during the event, and we will address them during the dedicated Q&A sessions.

I would also like to introduce our moderators for today's Q&A sessions. Seated at the table beside the stage here are Elliott Jones, analyst at Danske Bank; and Ole-Petter Sjøvold, analyst at SB1 Markets. They will moderate the Q&A sessions and help facilitate your questions throughout the day. With that, let's get started. The title of today's presentation is scaling presentation -- excuse me, scaling specialization and delivering greater value. Those 5 words capture both what Borregaard has achieved and where we are heading. Over many years, we have transformed a traditional industrial business into a highly specialized global company with leading niche positions built on renewable raw materials and deep expertise.

That transformation has delivered strong growth, improved margins, high returns on capital and significant shareholder value creation. Importantly, today's CMD is not about introducing a new strategy. It is about demonstrating why our strategy remains highly relevant, where we see attractive opportunities ahead and how we will continue to create greater value from the platform we have built. Before discussing -- our ambition is clear: to continue growing organically while creating greater value through specialization, productivity and disciplined capital allocation. Throughout the day, we will show how we intend to translate these opportunities into profitable growth.

The common theme is simple. We are scaling what already works. Before discussing the future opportunities, let me start with the platform itself. Borregaard's strength is built on our unique integrated biorefinery. From a renewable raw material stream, we create a broad portfolio of high-value products serving multiple applications, industries and end markets. Across many of our applications, we help customers replace fossil-based alternatives with specialized bio-based solutions. We utilize virtually all components of the wood, continuously shift our portfolio towards higher-value applications and build resilience through diversification. Today, we serve around 3,100 customers across 100 applications and 100 countries.

A key driver of Borregaard's successful journey has been our specialization strategy. Rather than competing in commodity markets, we focus on specialized positions where performance matters, where customers value our deep expertise and where barriers to entry are significant. This strategy has created leading positions across our businesses. Today, we are the clear global leader in lignin-based biopolymers, a leading supplier of specialty cellulose, the world's only producer of wood-based biovanillin, a significant producer of advanced bioethanol and a leading producer of fine chemical intermediates for contrast agents.

Innovation and a strong culture of continuous improvement are embedded throughout the organization, enabling us to continuously develop new products, enter new applications, strengthen customer relationships and increase operational productivity. This is the highly diversified and resilient business model we will continue to build on. The best evidence that our model works is our track record. Since becoming a listed company, we have delivered strong and consistent value over time.

Return on capital employed has remained above our long-term target of 15%. EBITDA margins have improved significantly. Earnings per share have increased substantially, and our dividend has grown strongly and shareholders have seen attractive returns over time. The important point is what has driven that value creation. It has not been volume growth. It has not been financial engineering, and it has not been favorable market conditions alone. The primary drivers have been increasing specialization, innovation, continuous improvement in our operations and disciplined capital allocation. We have consistently moved our portfolio towards the higher-value applications we're in.

We have strengthened our market positions, invested selectively, improved productivity and increased capacity for our high-value products. That combination has enabled us to create significantly more value from largely the same industrial platform. And that is highly relevant as we look ahead because the same underlying drivers remain available to us today. So the value creation model is proven. The opportunity now is to build on that success. Why do we believe Borregaard is better positioned today than a few years ago?

The external environment has become more demanding, markets are more volatile and input costs and currencies fluctuate more than they did in the past. Despite these challenges, our performance has improved significantly over time and remains at historically strong levels, demonstrating the quality and resilience and also the adaptability of our business model. Operationally, our manufacturing platform is performing well. We have continued to invest in capacity, specialization, cost competitiveness and sustainability while strengthening our organization and enhancing the capabilities needed to support future growth. Most importantly, we see a stronger set of opportunities today than we did a few years ago.

Demand for high-performing and sustainable solutions continues to grow across several high-value markets, while also the regulatory developments are creating new opportunities across our businesses. At the same time, the investments we have made and those currently underway are strengthening our ability to capture these opportunities while supporting continued profitability. The investment case today is not only that Borregaard is stronger than before. It is that we are better positioned at a time when the opportunities ahead are becoming larger and more visible. When we discuss the future today, the starting point is therefore not a turnaround story.

The starting point is a stronger platform, and the next phase is about scaling what works. This slide summarizes how Borregaard creates value. Growth alone is not our objective. Many companies can grow revenues. What matters is converting that growth into value. At Borregaard, we do this through 2 mutually reinforcing priorities. The first one is specialization and innovation. By moving towards higher-value products, increasing our presence in attractive markets and strengthening niche leader positions, we create more value from existing production volumes. The second is productivity and cost discipline. We continuously improve the asset utilization, the energy efficiency, automation and digitalization while maintaining strict cost discipline.

These 2 dimensions are working together. Specialization increases the value of what we sell. The productivity improves efficiency and margins. Together, they increase value creation per employee and improve returns on invested capital. As the chart shows here, value creation per full-time employee increased by an average of 8% annually from 2020 to 2025. This dual focus has been a key contributor to Borregaard's performance over many years. And as you will hear throughout the day, this remains central to how we intend to create profitable growth going forward. The remainder of today's story can largely be summarized through 5 value creation levers.

The first lever, specialization, remains the most fundamental. Expanding further into specialized applications and strengthening our competitive positions improve the value we create from every tonne we produce. The second lever is capacity. Targeted investments and operational improvements enable us to produce more specialty products and capture additional growth opportunities. The third lever is geographic scaling. Many of our strongest products still have significant growth potential in markets where penetration remains relatively low. Around this world, many potential customers have yet to discover how Borregaard's solutions can help improve their operations and create value for them.

The fourth lever is productivity and cost discipline. Continuous improvements in productivity, energy efficiency, automation and cost management help protect margins, strengthen competitiveness and support profitable growth. The fifth lever is an external one. Across industries, the sustainability trends and regulatory developments increasingly support the shift towards bio-based alternatives, creating opportunities across several of our businesses. Taken together, these 5 levers build on the same proven drivers that have supported Borregaard's performance over many years. And give us confidence in our ability to deliver continued profitable growth in the years ahead, not through broad expansion, not through chasing volume, but through disciplined allocation of resources towards the most attractive opportunities.

Borregaard is entering the next phase from a position of strength. We have a unique biorefinery platform, highly diversified revenue streams, strong and specialized market positions and most importantly, a proven model for creating value. The story forward is, therefore, not about changing strategy. It's about being even more selective in where we are focusing our resources. We will continue increasing exposure to higher-value products and applications. We will invest selectively in capacity supporting growth in specialty markets. We will build on proven successes by deepening our presence in high potential markets and expanding into new geographies.

And we will maintain discipline in our operations, costs and capital allocation. Our ambition remains clear: to deliver sustainable organic growth, strong profitability and attractive returns. In short, same strategy, sharper priorities, greater value creation. Today's CMD focuses on what we believe will be some of the most important drivers of value creation going forward across our BioSolutions and BioMaterials businesses and also in our manufacturing.

To begin, I would like to introduce Knut-Harald Bakke, who joined Borregaard in 2019. He became Executive Vice President for BioSolutions in August 2025. Prior to his current role, he served as Director of Energy and later as Director of Investor Relations, so a familiar face to many of you.

He holds a Master of Science in Industrial Economics and Technology Management from the Norwegian University of Science and Technology. Drawing on 14 years of commercial, operational and strategic experience, Knut will take us through how we're capturing the significant growth opportunities ahead in BioSolutions. Knut, the stage is yours.

Thank you, Tom Erik. BioSolutions has a strong platform with significant untapped value. In this part of the presentation, we will show how BioSolutions can capture more of that value by scaling what already works. I will begin by describing the foundation we are building on, then explain how we prioritize the portfolio and finally outline 3 pathways to greater value creation. Let me start with the foundation. BioSolutions has developed strongly over the past decade with specialization as an important driver. The chart on the right shows the development in sales revenues.

The volume split beside it is equally important. Specialties represent around 60% of revenues while only accounting for 28% of volume. Today, specialties include, among others, biovanillin, battery additives, oilfield chemicals and the high end of the agriculture portfolio. This illustrates the value of shifting the portfolio towards applications that create greater customer value. But the opportunity is not limited to products currently classified as specialties. Most of our volume still is in industrial and construction. Also here, we can move up the value ladder through more specialized applications, more advanced formulations and stronger customer positions. This is the key point. We see significant headroom to create more value from the existing volume base rather than relying on volume growth alone.

Our broad portfolio gives both resilience and opportunity. But it also means we need to be very deliberate about where we focus our efforts. To understand those opportunities, let's first look at the capabilities we already have in place. The reason we see so many opportunities is that the starting point is strong. First, we have unique technology and expertise. We combine renewable raw materials with leading technology and deep application expertise to develop differentiated solutions across a wide range of applications. Second, we have proven customer value. We serve 2,800 customers across industries and geographies with documented performance and global reach. Third, we have already established specialty solutions across agriculture, industrial specialties and consumer ingredients.

Together, these strengths give us a broad range of growth options. Technology is often not the limiting factor. In many areas, we already understand what we need to do technically. The bigger challenge is identifying the most important customer needs, understanding where we can create the greatest value and concentrating resources behind the opportunities that matter most. We have many opportunities, but we cannot pursue all of them with the same intensity. That is why clear portfolio priorities are essential. This framework translates opportunities into priorities and resource allocation. The horizontal axis reflects the strength of our position, including customer relationships, commercial proof and how we win.

The vertical axis reflects realistic value growth potential based on market attractiveness, customer demand and our ability to differentiate. In the top right, we have our core champions. Plant nutrition is one example, an established position with proven customer value and attractive opportunities across customers, applications and geographies. Our priority is to strengthen and expand these businesses. In the top left, we have our emerging stars. Fertilizer coating is one example. The opportunity is attractive and close to capabilities we already have, but broader commercial validation is still required. Here, we invest selectively against clear milestones. Mature positions such as concrete admixtures remain important businesses.

We protect these positions, optimize the mix and improve the businesses. In constrained segments, such as dyestuffs in textiles, growth potential and returns from additional resources are less attractive. We, therefore, limit incremental spending while managing the existing business responsibly. The important point is that this is not just a way of describing the portfolio. It guides where we allocate commercial attention, innovation resources and capacity. These priorities lead directly to 3 pathways to greater value creation. Let me briefly explain those 3 pathways. First, we scale our core champions. We will win more customers and strengthen proven positions, including plant nutrition, crop protection, animal feed and gypsum boards.

Second, we move up the value ladder. We will shift more of our volumes towards applications where performance, formulation expertise and regulatory capabilities command higher value. Third, we expand geographically. We will take proven products and customer solutions into new markets where our current penetration is relatively low. These 3 pathways reinforce each other. A core champion can expand into new geographies, an established industrial or construction application can move up the value ladder and a validated emerging star can become a future core champion.

We see substantial untapped potential in the portfolio we already have. In many cases, capturing that potential is as simple and as difficult as identifying customer needs and connecting them with solutions and capabilities that already exist in BioSolutions. Digital tools and AI can help us connect customer insights, market signals and technology expertise more effectively, but they do not replace being close to customers. Local commercial and technical presence remain essential. This is focused growth, primarily built on an existing platform, proven customer value and capabilities we already have. The objective is to increase contribution margin in absolute terms while making effective use of the capabilities and asset base we have.

The next part of the presentation will make this more tangible. Guro Elise Fredheim is our CTO. She holds a PhD in biopolymer chemistry and has more than 20 years of experience from innovation and leadership roles within Borregaard. Eduardo Pereira is Business Director, Agriculture. Since joining Borregaard in 2002, he has held a range of commercial roles across applications, regions and markets and today leads our agriculture business globally. Anders Sjöde is Vice President, Sales.

He holds a PhD in wood chemistry and has nearly 20 years of experience across innovation, business development, project execution and commercial leadership within Borregaard. Together, they will show how we scale proven winners through specialization, market penetration and geographic expansion. Guro will begin with our portfolio, pipeline and competitive position. Guro, the floor is yours.

Thank you, Knut-Harald. I will give you an introduction to our unique product properties and the diversity of the end markets we serve within BioSolutions. The core of our offering are high-performing products that can be tailored to deliver cost competitiveness in the end application. They are multifunctional, a concept I will explain in more detail later and valued by customers for their robustness in use. We also support our sustainability claims with strong documentation, including life cycle assessment and environmental product declarations for all our products globally.

Our products span a wide range of physical properties, enabling us to serve markets with different growth drivers and economic cycles. And the first area is the binding applications, where our products improve strength, durability and process efficiency. Examples include animal feed and crop protection, which you will hear more about later. A second major area is dispersing and rheology control, where our products help ensure stability, flowability and uniform distribution of, for example, particles across broad application areas from construction materials such as gypsum and board to crop protection formulations.

And these products typically improve processability, energy efficiency and end product performance. We also create value for our customers through crystal growth control, helping to control, for example, precipitations in high-end applications such as batteries and oilfield chemicals. Our platform also extends into flavors and fragrances, where lignin-based biovanillin is used in food, fragrances and personal care applications. And our products also have additional features such as antioxidant complexing or UV protection properties.

And these properties come on top of the other features mentioned. And in several applications, our products are valued for the multifunctional mode of action. And taken together, this wide range of properties and applications is what gives us a strong competitive advantage. There is a unique application and technical know-how in the organization founded in a 100-year history within Lignin business. And the product and application know-how, customer-specific tailoring and global market reach builds barriers to entry as well as our basis for further specialization.

Borregaard holds a strong competitive position despite operating in a fragmented and highly competitive market. The competitive landscape can be divided into 4 broad categories. Within lignosulfonates, Borregaard is a clear global leader. We combine the industry's broadest product platform with decades of technology development, application expertise and market knowledge. In addition, our global manufacturing and commercial footprint enable us to provide reliable supply across all key markets.

Several regional lignosulfonate suppliers exist, including Domsjö, Sappi, Nippon Paper and various local producers in China and Russia. Please also note that other types of lignin, for example, standard kraft lignin and soda lignins are not applicable for lignosulfonate applications. We compete not only with other lignosulfonate producers, but also with a broad range of synthetic chemistries, including naphthalene sulfonates, polycarboxylates, EDTA, phosphonates. Importantly, this is not a winner takes all market.

For decades, lignosulfonates and synthetic chemistries have coexisted with customers selecting the solution that provides the best balance of performance, cost and sustainability for their specific need. And Borregaard has successfully maintained and developed our position alongside these fossil-based alternatives. We also compete with a range of bio-based alternatives, including starch-based products, cellulose derivatives, sugars, amino acids and seaweed-derived materials. Many of these technologies target specific application niches and faces limitations related to performance, scalability, economics or also competition with food resources.

In many applications, customers do not choose a single technology. Instead, they combine multiple ingredients and optimize formulations to achieve the desired performance at the lowest cost in use. As a result, competitive success increasingly depends not only on the performance of the individual component, but also on the formulation synergies, compatibility and application-specific optimization. Borregaard's competitive advantage extends beyond the product itself. Our technical experts recruited from the end-user industries in combination with our R&D organization have in-depth knowledge of the customers' applications.

We operate dedicated application-specific test laboratories, including, for example, plant nutrition and seed formulation facilities. This application expertise enable us to evaluate products and formulations in the end applications to find the best solution for the customer. Our customers do not buy chemistry. They buy performance. And Borregaard wins by understanding the application and the customer pain points better than the competition and translating that into value. Let's continue with innovation.

Our innovation strategy is focused on turning strong market positions and deep technology expertise into profitable growth. Our innovation portfolio is prioritized according to 3 selection criteria. We focus on projects within core champions and emerging stars, meaning application areas with a high margin and where we either have or we see the potential to develop a strong market foothold, referring also what you heard from Knut-Harald. This means we prioritize projects with high-value potential, enabling us to move up the value ladder. And third, innovation must be driven by a clear market pull and customer needs.

And this matrix, as you see here, illustrates our innovation portfolio. In the down left corner, we have projects focusing upon new products into new markets, whilst in the upper right corner, we have product line extensions into existing markets. So down left, higher risk, upper right, lower risk. As you can see, the portfolio is weighted towards the top right corner, the core champions, meaning with product line extensions and towards existing markets where we have a strong foothold.

Here, you find projects such as biostimulants and gypsum board and crop protection, where we have significant application knowledge and current market access. And you will hear more about these from my colleagues in the coming presentations. If we go down the right, we have product line extensions into new markets such as biocontrol and Fertiliser coating, where our existing products and technology platform create differentiated solutions in new end markets. If you go down left corner, we have more exploratory opportunities with new products into new markets, including home care and emerging feed applications.

These are longer-term, higher-risk projects. And finally, we have new products going into existing applications. And in the coming slides, I will tell you a bit more as to our project upon granulated lignin. The takeaway is that we have a strong innovation pipeline with clear priorities. The portfolio consists of core champions and emerging stars, building on our strength to improve likelihood of commercial success. And differentiation is central to how we create value and protect our product position.

And we are the first lignosulfonate producer globally to offer lignin products in granulated form. Our demonstration plant has been operational since the first half of 2026 with a capacity of 1,000 tonnes, and we can deliver product in granulated form to selected end markets. Importantly, this innovation is driven by market pull. Customers are looking for products that are safer, easier and more efficient to handle. Granulation provides clear benefits across the customer value chain.

The granulated products improve environment, health and safety with minimal dusting, supporting a cleaner working environment and improved handling. It also enables higher productivity at the customer site, reducing time for processing. And finally, it improves logistics, including transport and storage. The technology will be applied to a selected range of our products for key markets. For our customers, this means operational savings as well as overall better user experience. For Borregaard, it strengthens differentiation in the lignin market and creates an opportunity to capture more value from our product portfolio.

And we will now show a video demonstrating the difference between handling a standard lignosulfonate product in powder form versus handling a lignin product in granulated form. And the standard powder product is to the right and the granulated lignin is to the left. And as you can see, the granulated product flows much more easily and creates far less dust. And if you can imagine this at industrial scale, the impact becomes even more significant. So this is an example of how we combine technology with understanding of customer needs to move up the value ladder. Thank you for your attention. Now I'll give the word to, Eduardo Pereira.

Thank you, Guro. Good morning. Today, I will explain why we are confident agriculture will continue to be a major contributor for Borregaard future growth and value creation. Agriculture accounts for 45% of BioSolutions revenues and around 25% of Borregaard total revenues. It has delivered strong growth over the last years, and we believe the best opportunities are still ahead of us. But before talking about Borregaard, let's start with the challenge farmers are facing today. Agriculture uses around half of the world's arable land, and around 75% of that is used for livestock production. It accounts for roughly 70% of the freshwater withdrawals, and it has a significant contribution of the global greenhouse gas emission.

At the same time, farmers are dealing with soil degradation, nutrient losses and declining soil quality in many regions. These challenges are real, and they are not going away. Food and animal protein demand continues to grow. Climate conditions are becoming less predictable. Natural resources are under pressure. Regulatory and consumer trends require more sustainable farming practices. These challenges are driving demand for solutions that improve productivity, reduces losses and support more sustainable agriculture. Agriculture is changing and moving from input intensity to input intelligence.

The focus is no longer on using more inputs. It's on getting more value from every input used. We see these trends in 4 important areas. Smart fertilizers programs where farmers are increasingly looking for ways to improve nutrient use efficiency. This includes crop-specific nutrient programs, micronutrients and digital agronomy tools. The goal is better performance, lower losses and higher crop quality. Biostimulants are becoming a normal part of crop nutrition programs. They help improve nutrient uptake, plant resilience and crop quality. This is one of the fastest-growing segments in agriculture.

Farmers and regulatories increasingly expect the same or better performance with a lower environmental impact that requires smart formulations, better delivery systems and improved efficiency. Advanced dispersant, adjuvants and biological formulations help achieve these goals. The same trend is also visible in animal production. Livestock producers are looking for higher feed efficiency, better nutrient utilization and lower environmental impact. Solutions such as feed binders, bypass proteins help improve animal performance while reducing waste and emissions. Just like all agricultural sectors, animal nutrition is becoming more precise and more data-driven.

So the next question is, how is Borregaard positioned to benefit from this shift in agriculture. We have an extensive and diversified agriculture offering, split in 3 main segments: plant nutrition, crop protection and animal feed. Plant Nutrition is our fastest-growing area. It includes biostimulants, micronutrients, fertilizers and seed coating and granulated fertilizers. These applications help improve nutrient efficiency, crop performance and productivity. Crop Protection remains our largest and most established platform. Here, we support traditional crop protection, biocontrol solutions and adjuvant systems. Our technologies improve stability, compatibility and overall performance in the field.

The third area is animal feed. Here, our solutions improve pellet quality, feed efficiency and protein utilization.

What is important is that all 3 segments benefit from the same long-term trends we discussed on the previous slide, helping farmers and food producers get more value from every input. At the bottom, you can see the estimated annual growth rate in the different end markets. Plant nutrition is the fastest-growing area, and we expect that our business to grow faster than the end markets due to performance and sustainability.

Crop Protection remains a large and resilient market, where we also expect to exceed market expectations due to some of our most advanced products in multi-active formulations. Animal feed provides a stable growth with growth of 3% to 5%. Together, this business gives us both solid growth and resilience. But let's be more specific. Plant Nutrition is our main growth engine. It has delivered strong growth over the last several years and will continue to deliver strong growth going forward. I'd like to highlight 3 growth areas. First, biostimulants. We already have commercial products in the market, including EU CE-marked products. It indicates that our product complies with EU health, safety and environmental protection standards.

Second, micronutrients. We offer ready-to-use solutions that simplify implementation for customers. Third, fertilizer coating. These technologies improve nutrient efficiency and support high crop yields. The winning formula is a combination of innovation, performance and scale up. First, innovation. Our field trials help customers demonstrate performance and support product claims, saving customers time and accelerating their product introduction. Second, performance. We generated validated nutrient use efficiency results across multiple crops and applications.

Third, scale up. Many of these solutions can be scaled up across regions, customers and formulations. This creates opportunities to grow faster than the underlying market. The chart on the right illustrates this journey. Over time, plant nutrition has become a significant contributor to our crop performance revenues, consistently growing faster than crop protection. But while Plant Nutrition is our fastest-growing segment, animal feed is another attractive market with a different growth profile.

Our business is built around 3 main application areas: pelleted feed, feed emulsions and bypass proteins. These solutions help improve feed efficiency, pellet quality and nutrient utilization. What makes this business attractive is our ability to combine innovation with application expertise. Again, the winning formula is the combination of innovation, performance and scale up. The first pillar is innovation. New products create opportunities, both with existing customers and in new markets.

The second pillar is performance. Changing regulations create opportunities for approved solutions. And the third pillar, it's scale up. We still see significant growth opportunities, especially in pelleted feed application. The chart on the right shows the strong growth achieved in animal feed over time. This growth demonstrates our ability to create value even in a mature market. In summary, our agriculture portfolio combines leading positions across plant nutrition, crop protection and animal feed, all supported by strong long-term trends in productivity, sustainability and resource efficiency.

What differentiates Borregaard is not only our high-performing products with strong market positions, but also our deep application expertise. Our dedicated agriculture team with more than 50 professionals brings together agronomists, veterinarians, formulation specialists, application experts, laboratory and R&D capabilities, many with extensive experience from the agriculture industry. Our sustainability credentials and our ability to help customers meet increasing demanding in regulatory requirements position us well to scale proven winners, accelerate growth and create increasing value in the years ahead. Thank you. Now I will leave you with Anders. Anders, the floor is yours.

Thank you, Eduardo. Up until now, we talked about the platform, the portfolio and how we prioritize opportunities. Now I would like to bring this down to 2 very concrete examples. Both illustrate the same principle, but are somewhat different. The first is replacement of synthetics in gypsum boards, and the second is geographical expansion. At the first glance, they look very different. One is a new application opportunity. The second one is a new market opportunity. But in reality, they're driven by exactly the same logic. We start with existing products, existing capabilities and proven customer values and then we scale.

No major technology leap, no new production platform, proven customer value, and that is what we scale. It's just disciplined commercial execution built on strengths we already possess, and that's why we call it new customers, new markets, same winning formula. Let me start with gypsum board. This is one of our most exciting examples right now, a small opportunity becoming a real growth platform. Historically, the industry has relied on synthetic additives such as polynaphthalene sulfonate and polycarboxylate ethers. For many years, manufacturers had little or no reason to change. But the market has changed. CO2 targets, regulations, rising additive costs, supply chain uncertainty suddenly the discussion is different.

That creates an opportunity for us. We have a sustainable solution that replaces synthetics on a one-to-one basis. What's particularly encouraging with this is that it's no longer a laboratory story with more than 200 R&D tests, successful plant trials and commercial use already during 2026. Here is a key reflection. Sustainability starts the discussion, performance decides the outcome. We are invited by our customers to the table because we are sustainable, but they buy from us because the product performs. So the job ahead is no longer proving the concept, it's scaling it. Every new plant adds additional volume. And with a 10% to 20% global replacement, this will allow us to have a 4% to 8% growth rate within Borregaard's Construction segment in the years to come.

So plant by plant, customer by customer, geography, that's how we build our core champions. If gypsum shows how we win in new applications, geographical expansion shows how we win in new markets. The most important part about this slide is not what we're saying. It's actually what we are not saying. We are not building a new business, not developing fundamentally new products and not making large speculative investment. Instead, we ask a simple question, where do we already have solutions that work and where are they underrepresented? There are many markets where Borregaard has limited penetration despite highly relevant products and proven customer value.

The map on the right side is not a sales forecast. It highlights untapped potential. The darker countries represents areas where the market has developed faster than Borregaard's footprint. The economics are appealing, modest investment, low technology capability risk, limited assets needed. So this is built on existing strength, a second growth engine for BioSolutions. The playbook itself is simple. We start with proven platforms, then choose markets carefully. Not every opportunity deserves an investment. And today, that points us towards selected parts of Asia, Oceania and Latin America.

Then comes local reach. This is the part where I feel strongest about. One lesson I've learned throughout my career is that customers buy from people. Despite all the AI and digitalization we have around us, local presence and local engagement is the vital part for success. Without that, you can have the world's best product, but progress will be slow. Finally, once we have proof, we replicate and scale it. It's a little bit like franchising a good restaurant. You don't reinvent the menu every time you open a new restaurant. You simply find a new good location and you scale it.

That is exactly what we're trying to do here. We will repeat it with discipline. This final slide brings it all together. And the secret is there is really no secret. The winning formula is straightforward. We take our market leadership positions with global leading positions across multiple segments, a unique product portfolio that solves real customer problems, application expertise built over decades, high barriers to entry. These positions are hard to attack. That is the foundation of BioSolutions.

Focused innovation, a high-value pipeline with every project market pull driven. We do not invent and then go looking for a customer. The customer asks first and we solve the real problems. That is how we transform expertise into new opportunities and reach the market faster. Geographical expansion is where we scale proven winners, no experiment. We take what already works and move it into untapped geographic growth markets like Asia, Latin America and Oceania. The model is replicable, so every new market is faster than the last.

And the 3, they reinforce each other. Leadership gives us customer insight, innovation turns insight into new opportunities and geographical expansion moves those winners into new areas. That is how we win. It's not growth built on hope and dreams. It's growth built on evidence, proven products, proven customer value and economics. So new customer, new markets, same winning formula.

Thank you very much, Anders. So that concludes the presentations in part 1 of today's CMD, and we will now move on to the Q&A session. We'll be joined on the stage here by Knut-Harald Bakke, and we will take questions from the audience and from those joining us via the webcast. Following the Q&A, we will take a short break, resuming with part 2 at 11:00. Elliott and Ole-Petter, please take it from here and moderate our first Q&A session.

And also in the audience and a microphone will make its way to you. But I guess I can start with the first question here on the BioSolutions side. So a key part of the specialization strategy has always been and will still continue to be shifting to the higher-value products. You highlighted an impressive chart at the beginning showing the growth of this. But the question is essentially, is there a theoretical ceiling as to what percentage of BioSolutions can be specialized? And if so, what level?

Yes. So if you start with what we have in place. So we have a unique raw material. We have the technology or at least we know what to do technically. So the bottleneck, if you like, is market and product development, which is really encouraging because we have the faith in our own hands. So the potential is it is significant. What we have explained here today is that our focus is on scaling what already works. Our focus is on the core champions in particular, because there, we are coming from a position of strength, and we see from today and going forward that there is a great value potential. So I will not give you any numbers. But for sure, the potential is significant.

I guess I could have a question related to that. Just sort of how do you sort of assess that investment opportunities in increasing your total capacity, sort of introducing Borregaard technology into this mix or increasing further capacity versus investing more into further specialization. How do you consider these 2 offensives against each other?

Our main focus is value growth. So moving up that value ladder. From our perspective, from a risk return perspective, that is the smart thing to do. But of course, if we, at some point, need or want more volume, we have the options and the toolbox to do that. And we are already doing that with the debottlenecking in Sarpsborg, we will get more also of lignin-based biopolymers. We will actually get more of everything, specialty cellulose and bioethanol. So that's a starting point in the short term.

And as you point out, we have in the midterm options in the U.S. to expand by another 50,000 tonnes. And in the longer term, I think we can consider that a strategic insurance if we, at some point, wanted to build a greenfield plant, with the technology. But for the time being, our focus is on climbing that value ladder. And first of all, the volumes we will get from the debottlenecking in Sarpsborg.

Yes. And I also think it's worth remembering that a 5% to 10% capacity increase in Sarpsborg in big markets, I mean, we have 1.4 million tonnes of specialty cellulose, 890,000 tonnes of lignosulfonate. So these are highly valuable volumes when gradually phased in by Borregaard. But in these big markets, it's also a cautious approach to growing in that market.

I think we have a question.

Marcus Gavelli, Pareto. So you mentioned the geographical expansion, which will certainly be a big part of the growth strategy going forward. Could you just try to elaborate on how we should think about, call it, the sales and marketing expansion -- because certainly, you have a global base, which you can utilize. But coming into these markets, I would assume also will require some increased investments, I think modest investments was mentioned in sales and marketing. And just how we should think about the financial incremental steps in that journey?

So, like Anders pointed out, this is asset-light. So, it's mainly human capital, if you like, in the designated geographies. So, we are particularly looking into Oceania, Australia, Spanish-speaking part of Latin America, where we are significantly underrepresented today in terms of sales and some other countries, specifically in Southeast Asia. But to answer your question, I think it will vary between the different regions. A natural starting point is to find a small niche distributor that we can work with. We're not ruling out that at some point, we could perhaps buy one of those small distributors, or we can establish a sales office from scratch.

So -- but the most of actions will vary across the regions. And certainly, what we're doing here is that we take proven solutions, things that we know work into new geographies, typically things that work in Europe and in North America into these other regions. So, from a risk perspective, of course, there are some commercial risks, but there's no technology risk. And it's, to a large extent, a risk that we can control. So, we can exit at any time if you want.

And also looking back at our Capital Markets Day 2 years ago, we mentioned, for example, Asia was one of the high-growth areas with agri being one of the, I would say, the most interesting area. Since then, we have opened a new office in Mumbai, where we have been and seen. We have recruited highly capable personnel on the commercial side, on the technical side, also have an R&D lab for agri and industrial specialties. And we have recruited people in Indonesia, Vietnam, China. And also, we have office in Brazil, South America, and we have well-established platforms. So this is also scaling what works. We will use those platforms to build on further.

Magnus Rasmussen, SEB. The strategy is sort of shifting a little bit to more towards scaling what works. You're framing this as a big opportunity, of course. But I also want to know, is it a reflection also of a bit of a challenging start to 2026 with more cost pressure. You're sort of taking a more cost cautious approach? And is it also a reflection of sort of a bit of a slowdown in new exciting product development?

No, I wouldn't say so. I think given the position that we have, perhaps one of our biggest risks is actually spreading ourselves too thin. So, what we're doing here is really positioning ourselves where we see we're coming from a position of strength. We have documented proven customer value. We are actually solving some pain points for our customers globally here. And this shift the structural drivers that we're seeing, for instance, in agriculture and gypsum boards, these things are at the nexus of performance, regulatory aspects and sustainability. And these are kind of sweet spots, if you like, where we want to be. So, we're sharpening the priorities a bit here. It does noth mean that innovation is not important anymore because it really is, as Guro explained. But we try to allocate resources behind the opportunities that we think matter most now.

I would also say, Magnus, that in today's environment, it calls for high discipline and a bit more focused approach. So with that comes clearer and sharper priorities. And as you've seen, we have through the year, taken down our exposure in bio-based investments. We have been doing assessments and reviews of our innovation portfolio, where we are focusing more on the near-term, midterm commercial high potential projects. Also, we have announced last quarter, we have a cost project where we will save NOK 150 million and fully realized in 2028. So, definitely, you're also right that we are looking carefully over what we're doing to ensure we have that discipline and our focus in what we're doing.

Another question, if I may. The oil price volatility that we've seen this year, also rising energy costs. Can you share some thoughts about what -- how you think about pricing sort of going into next year and also the opportunities versus oil-based alternatives that you often compete with? I'm assuming they might be struggling a bit.

Do I start?

You can start.

No, for sure. It's a volatile geopolitical situation and energy prices are on the rise. And for us, that means that variable costs are increasing for energy and energy-related costs, logistics costs. So we are in the business of selling specialties and buying commodities. So when these things happen, typically, our margins get a bit under pressure. So we may not, from one quarter to the other, be able to offset that cost increase. But over time, we should be able to do so. We see also that it affects some of the end markets. So some end markets are soft. But from where we're standing, strategically, we ask ourselves the questions, are we solving the most important customer challenges, and we think we are. So it does not -- it affects timing for us this market cycle, but it doesn't change the underlying value proposition of what we do and deliver to the customers.

Yes. I think we see some selective opportunities where it has impact on certain products where you could get more request for our products. I think you can also see that high oil price also means higher energy prices for certain industries and customers where that's the impact. But over time, we believe this is -- it's favoring Borregaard's products and solutions when more and more will look towards the bio-based solutions.

Maybe I can take one more. Just speaking of customer challenges. Farmers in recent times have seen significant -- farmer affordability has been very tough. Just in terms of agriculture, can you provide some color as to when we see a very high fertilizer price, is that typically positive or negative in terms of customer acquisition?

Yes, that's actually an excellent question. So there are several parts of our agriculture portfolio, right? It's crop protection, like Eduardo explained. That's the legacy. That's the foundation. So, it's -- up until today, it is the biggest part. Then you have plant nutrition growing at a very high pace, and we expect that to grow double digit percentage-wise going forward. So, to answer your question, intuitively, when fertilizer prices are on the rise, if you're smart, you buy the plant nutrition products because that enables you to everything else equal, use less fertilizer and have the same yield, for instance. And also in terms of climate change and changing weather patterns, these things makes the plants and the crops more robust, able to withstand so-called abiotic stress, droughts and frosts and so forth.

So, these are really the kind of products for the future. But if you look at crop protection, what is happening and when we talk to our customers, because we see that crop protection in the first half of 2026 is significantly lower than last year. What is happening is probably that, as you say, farmer economics are under pressure. And then we see that the distributors, they get more cautious and then the formulators are building down their safety stocks. So, typically, we supply to the latter.

So, if we believe what our customers are telling us is the truth, you have a softer end market demand at the customers, which is the farmer, which sort of gets amplified through this value chain back to us. So, who knows what the world looks like next year. But if you just assume that farmer economics stays exactly the same in 2027 as 2026. Everything else equal, we should do a little bit better in Crop Protection because safety stocks cannot be built down forever.

I have another question of sort of how you -- I mean, the core message from this in is sharp prioritization, right? So, how do you work differently in the company specifically? Like do you work any differently with the customers? Do you implement more systems to sort of see where the best ideas are? Or -- and how do you value sort of growth opportunities versus introducing more technological risk into new products?

So, if you remember that chart that Guro showed you, the axis where the degree of product familiarity, so the degree of technology familiarity to us and the degree of market familiarity. So, it is now weighted towards existing product lines, technology we know, markets we know fairly well. But as you can see, we are also in areas where there are new products into new markets. And as Guro pointed out, higher risk, but also high reward.

So, typically, in these areas, qualification cycles are longer, innovation cycles are longer and customer conversion is more gradual. But over time, if they succeed, this would typically be new specialty areas to us. And the positive side of the fact that this takes time is that once you're in that formulation with the customers or once you're in their production process, you're in there for years, if not decades. So, that's what we're trying to do.

That makes sense.

And then just maybe go back to specialization again. You mentioned 60% of the revenues were linked to specialized volumes, but obviously just 28% by volumes are specialized. Can you give some insight into the EBITDA per tonne uplift for a specialized tonne versus a nonspecialized tonne?

Good question. So, the margin in relative terms is not necessarily that different. But in absolute terms, it makes one heck of this difference. So, what we're trying to do numerically is instead of selling a standard lignin product to $1 a kilogram, incurring, let's say, $0.40 a kilogram in variable costs, then you have a contribution margin of 60%. We're trying to use that same raw material in specialized processes and sell it for $10 a kilogram. Specialization also means things are more resource intensive. So, variable costs are up to $4 a kilogram. So the contribution margin is still 60%. But in absolute terms, that's what we're after. That's what we numerically are trying to do with the specialization strategy.

And it's an application or an area with 1,000 customers, 200 products. So it's a wide range here. And some of those products are definitely also helping farmers to get a better economy. And I'm sure that's what we'll see also the plant nutrition part going forward.

There's a question from online here. I think touched on it, but you stopped disclosing your R&D spend. However, as a percent of revenue, it had declined from 5% to 6% in 2016 to 2017 to around 3% in 2023. We also saw the innovation rate print a record low in 2025. Has innovation simply become harder, if that's why you're now talking about client-driven innovation?

Yes, it's right. Innovation was 3% of our spend in 2025. I think it is with innovation that you place bets like you do with start-ups, you place bets. And I think also that's why we have been looking carefully at our portfolio because some of these projects we've been working on, we've been working on for quite some time. And also some of these projects have had a longer time horizon than what we think is the right focus now. So that is also a reason for making sharper priorities. Like I said, we are focusing more on short-term, midterm projects. We do not have a target to take down our resources within innovation. But as a consequence of growth in revenues, that share has come down a bit.

And last question for me. With the example of the Gran products you showed on the video, how should we think about the split share of this value creation between you and your customer? How much -- like do you think when you go into this process and develop a product with the customer, are you trying to keep the 50-50% each of the value uplift you introduce to the product? Or how is this shared -- at least how do you think about this?

The question was on granulation.

I mean, as an example.

Yes. No, customers willing to pay for a product in a granulated form, those are the ones we are addressing. So, bear in mind, this is 1,000 tonnes demonstration plant. So, typically, we will start with niche markets. And in some market, it is a prerequisite to have it in granulated form, such as home care where we want to go in. So -- but this technology, it opens doors to new opportunities, but also to existing ones. It's an ability to differentiate. So, no, I mean, we need to figure out the value in use for our customers from this technology. So, at some point in time, perhaps we will make a bigger investment. But at this point in time, it is the 1,000 tonnes demonstration plant.

We're quite confident when we're starting to send out samples of these products together with others, it will be something many customers will like.

And just a question here on the agriculture subsegments, so plant nutrition, crop protection and seed. Can you provide any color as to the approximate percentages of the agriculture top line, how those 3 right now?

Yes. Yes. Again, Crop Protection is the legacy business. We've been in there since the '70s, and we enable a water-based solution as opposed to a solvent-based solution when the farmers spread the solutions or pesticides out on the field. That was the starting point. And that has grown steadily over the years. What you saw from Eduardo's slide is that from 2012, plant Nutrition was relatively low, a small business, but has grown significantly over the years. And to give you some color, everything else equal, by 2028, we expect plant nutrition to surpass Crop Protection in terms of value creation for Borregaard, everything else equal.

And that is also from a strategic point of view, a good thing because, as you know, this crop protection business, there's some kind of cyclicality to it. So the higher plant Nutrition share, the less pronounced that market cyclicality will be in the future. So I will not disclose the split between Feed, Crop Protection and Plant Nutrition.

And animal feed is then not part of specialties, but part of our industrial business. So somewhat lower margins than in the specialties.

And just to touch on the batteries because in the previous CMD you held in 2024, you mentioned that you had some trials with global lithium-ion battery manufacturers. Have any of those trials progressed to commercial volumes? Or what sort of road map are you looking into there?

Yes. The question is on lithium ion.

We are still in key customer trials with, I would say, the big names, predominantly in China. Again, qualification cycles are long. So -- but when we get in, that will be a good moment for us. We have some small repeating orders. But to answer your question directly, it will not move the needle next year on profitability. We don't think so. But we are also now looking into the more second-tier companies in China that's working with sodium ion and silicon carbide anodes where we see that we have a performance that actually solves some problems for them. So early days, but that perhaps the innovation cycles are a bit faster there, so we can get faster traction. But early days, we are encouraged, but it will not move the needle on profitability next year.

And then maybe just one more for me before the break. I think also in the last CMD, you mentioned that it can be tricky to increase both volumes and specialty at exactly the same time. So given that, when we're thinking about potential new tonnage from debottlenecking coming in, should we expect then the -- initially the margins to be lower and then to kind of catch up in the years after? Or is there a different dynamic there?

Yes. So generally, when we introduce new volumes to the market, typically, we introduce that on the margin. So -- so to answer your question, we will introduce those volumes gradually and based on market demand. Initially, it may be that they will start going into industrial or construction applications. But over time, we will improve that mix. And our EVP manufacturing will get back to that in the next section, how we now plan to invest in new specialty lines that will help that transition.

All right. I see we're running out of time. So I think we'll go to a break and be back here at 11:00.

Thank you very much. See you after the break.

[Break]

Thank you very much. To introduce our next speaker, Gisle Johansen. Since joining Borregaard in 1991, Gisle has held several leadership positions across the company, spanning the manufacturing site in Sarpsborg, R&D, business development and fine chemicals. Since 2019, he has served as Executive Vice President, Specialty Cellulose and Fine Chemicals. He holds a master's degree in organic chemistry. And drawing on more than 3 decades of experience across Borregaard and his current role leading our Specialty Cellulose business, Gisle is ideally placed to discuss how we will continue to strengthen competitiveness and create value in Specialty Cellulose. Gisle, please.

Thank you for the introduction, Tom Erik, and good morning to all of you. Today, I would like to focus on how we continue to create and grow value in Specialty Cellulose. Our strategy is not built around becoming the largest producer in the market. It's built around value growth by becoming increasingly more specialized. Over many years, we have moved our portfolio towards applications where quality, consistency and technical support matters and where our softwood sulfide platform is an advantage. It's several years since we exited the textile viscose commodity market. That has strengthened our market positions and improved value creation.

The next step is a continuation of the same journey. We see attractive opportunities in premium niches such as regulated applications and high-purity markets. Combined with our Biorefinery platform and the ongoing capacity expansion, this gives us a clear path towards even higher value creation through to 2030.

Before discussing markets and growth opportunities, it's worth reminding ourselves what role Specialty Cellulose plays. We start with a renewable raw material, certified spruce softwood from living Scandinavian forests. From that material, we enable products that reach well beyond the cellulose industry itself. Our materials is used in pharmaceuticals, food, building materials and a wide range of other consumer products. And where our cellulose constitute from approximately 60%, up to 100% of approximately 50 direct customers' products.

One implication of this is that most customers will seek to maintain at least two qualified suppliers due to the criticality of this raw material. What is particularly interesting is the scale of the full value chain we participate in. A relatively concentrated Specialty Cellulose industry supports thousands of downstream products and ultimately reaches billions of end users globally. Our cellulose represents from less than 1% up to 100% of the final consumer products, spanning from vegetable burgers, toothpaste and concrete to bioplastics and sausage casings.

The total downstream value chain is estimated to exceed USD 100 billion. But the key point is that we are not selling into one market. We are part of a supply -- of supplying critical functionality in many different applications, industries and end users all over the world. That diversification creates resilience and provides numerous opportunities to identify and move into attractive niches where we can create additional value over time.

The Specialty Cellulose market is approximately 1.4 million tonnes and remains relatively concentrated. The five largest producers account for more than 80% of global supply. However, not all producers are positioned in the same way. Many competitors still have significant exposure to commodity grades. Borregaard is different. Among the major producers, we have a market share just about 10%, but we are the only company that is fully specialized, and we have a sulfide spruce softwood platform, which is a must in some applications. This gives us a great flexibility across applications, grades and customers.

The ongoing capacity expansion supports further value creation. When market conditions change like the building industry, we can redirect volume towards more attractive segments. That flexibility becomes increasingly valuable as competitive conditions evolve. We are currently seeing changes across several parts of the market, including the strategic review of the market leader and ongoing trade measures affecting certain regions. At the same time, geopolitical uncertainty is driving higher costs for energy, chemicals and logistics across the industry. This may support selective price increases going ahead towards 2030.

When we look at the Specialty Cellulose market, as described in the picture to the right, not all segments are equally attractive. Our strategy is therefore, not to become a Turkish bazaar and grow everywhere. Our strategy is to grow where we have the strongest competitive advantages. In ethers, regulated applications such as food, pharma and personal care and niches within technical applications remain attractive. These segments have high barriers to entry and place greater emphasis on quality, documentation and technical support. They are favored by the capabilities of our plant to produce a full range of viscosities.

In acetate, our focus is increasingly on premium niches such as liquid crystal displays, acetate yarn for textiles, specialty coatings and bio-based plastics. These are areas where performance and purity requirements are high and where our softwood-based product characteristics are valued by our customers. Rather than chasing market share broadly, we are selectively increasing exposure to the most attractive parts of the portfolio. Common for both segments in these applications is that customers' qualifications can take years, which creates barriers to entry for new suppliers.

This slide is important because it demonstrates execution. Our strategy is not only about future ambitions, it's also about what we have already delivered. Several years ago, we identified and communicated a clear opportunity and ambition to move further into demanding high-purity applications, and we branded it Ice Bear. This required substantial investments in research and development, equipment, customer qualifications and long-term commercial development. Through the Ice Bear qualifications, we have -- we are successfully building positions in applications such as regulated ethers, LCD, acetate yarn, specialty coatings and biodegradable plastics, where our cellulose constitutes approximately 60% of our customers' products.

Many of these applications are dependent on softwood raw material, and we have increased our acetate sales to these segments from a low level to an estimate of around 35% of total acetate sales in 2026. It demonstrates that we can identify attractive niches, qualify products, develop existing customer relationships and create value over time. That gives us confidence in the continuation of our portfolio development.

Ethers represent another large and attractive area for continued growth. Here, the barriers to entry are significant and softwood and the sulfide process is mostly required to reach the necessary product specifications. Regulations, customer approvals and technical requirements limit the number of viable suppliers.

This plays directly into Borregaard's strength. For decades, we have supplied biovanillin and fine chemicals to the most demanding food and pharma customers, which makes us unique in our industry. We have a broad portfolio, deep technical expertise and a leading position in sustainability documentation and certification. Our focus is particularly on pharma, food and personal care, but also selected industrial and high-purity applications where competition is limited.

For example, high and ultra-low viscosity grade ethers. These markets fit well with our capability profile, which probably makes us the most advanced player in this segment, and it supports continued value growth. The key point is simple. Growth in ethers is not driven by volume alone. It's driven by growing in the right applications. And to quote a technical auditor from one of our larger customers, "I wish we could buy more from you."

When we bring the pieces together, we have a clear road map towards 2030. This figure is an illustration of the direction we are going in. We will continue to improve our product and customer mix, expand capacity through de-bottlenecking and higher plant utilization and further strengthen our position in premium and regulated markets. As we have a very high flexibility in our manufacturing setup, it is fairly straightforward to move volume from lower value segments to increase our contribution margin. Importantly, our ambition is not growth -- our volume growth alone. The objective is higher value growth through a combination of increased facilitation, targeted capacity expansions and stronger product mix, combined with price increases in some segments.

To conclude, our strategy can be summarized in three points. First, we continue to increase our exposure to the most attractive markets and applications. Demand for high-performance, sustainable and highly specialized cellulose solutions continues to grow across a range of end markets. We will further optimize our product and customer portfolio towards applications that performance, quality and technical expertise are valued and rewarded. At the same time, we will strengthen our position in high purity and regulated segments where barriers to entry are high and customer relationships are long term.

Second, we leverage our unique biorefinery platform to capture these opportunities. Our integrated production model, operational flexibility and application expertise allow us to meet demanding customer requirements for quality, consistency and maybe most important, security of supply. These capabilities enable us to compete in markets where reliability and technical support are critical, creating advantages that are difficult for competitors to replicate. Third, expand capacity to accelerate value growth. Through targeted investments, de-bottlenecking initiatives and improved plant utilization, we are creating additional capacity that can be directed towards the most attractive growth opportunities in our portfolio.

We allocate capital where returns are the highest and where the greatest potential to create barriers to entry and long-term value are present. Importantly, our growth strategy is not centered on volume growth alone. It is centered on increasing earnings and value creations through a more favorable product mix. All incremental capacity will be targeted towards higher revenue applications with stronger margins rather than commodity volume. This is not a change in direction. It is the next step in a strategy that has consistently delivered value, increasing our exposure to attractive markets, leveraging our differentiated platform and creating more value from every ton of cellulose produced. Thank you.

Thank you very much, Gisle. Then I'm delighted to introduce our next speaker, who is Ole Gunnar Jakobsen. He is our Executive Vice President for Manufacturing and Technology, including all our international manufacturing units. Ole Gunnar joined Borregaard in 1995 and has been a member of group executive management since 2006. During his career, he has held a variety of manufacturing and operational leadership positions, and he has served as the Plant Director of our Sarpsborg site from 2006 to 2025.

He holds a master's degree in process engineering from the University of South-Eastern Norway. With more than three decades of experience from Borregaard operations, Ole Gunnar is uniquely positioned to explain how our manufacturing platform enables growth, competitiveness and long-term value creation. Ole Gunnar, the stage is yours.

Thank you, Tom Erik, and good morning, everyone. Over the next few minutes, I will show you how we turn strategy into results in our plants. One of my key messages is the strength in our continuous improvement culture. This is our single most important competitive advantage, and it's the hardest one for others to copy. Let me start with where we produce. The core of our manufacturing platform is the biorefinery in Sarpsborg. In addition, we have lignin plants in Wisconsin, Florida, Germany, the Czech Republic and the United Kingdom. The roles of the sites are different, and that is deliberate.

Sarpsborg is the fully integrated biorefinery where wood is refined into Specialty Cellulose, lignin-based biopolymers, bioethanol and biovanillin. The other plants produce lignin for the local regions. And this is a global manufacturing platform that is very hard to replicate. Our lignin products are produced close to our customers with lignin plants across continents. This provides supply security across all key markets, and we are not dependent on a single site or region. In addition, we have flexibility. Production can be shifted across units and applications, allowing us to respond to changing market conditions. This allows us to produce regional qualities where they belong and scale a proven process across several sites.

Then down to Sarpsborg, which is the foundation of the strategy. The sulfide biorefinery is a one of a kind and makes specialization, growth and stable earnings possible over time. This is where the most demanding and valued qualities are produced, and it's our main platform for technology and competence development. The Sarpsborg site accounts for more than 70% of the value creation in the group. Two factors makes it strong. The integrated value chain where processes in energy and competence are shared and the fact that we are highly self-sufficient with our own caustic soda and SO2 plants, water works and wastewater treatment plants.

At full utilization of the raw material where every part of the wood becomes a product and then you have a really unique production platform. The message is simple, a one-of-a-kind biorefinery at the core, combined with a global and flexible network is very difficult to copy. I would say, probably impossible. This is what protects our margins and gives us room to grow in specialties.

Continuous improvement is the core of the culture at Borregaard and our most important driver for value creation. Borregaard was an early adopter of a lean mindset. Over decades, this mindset has developed internally and in cooperation with external partners into the model we have today. The culture is the enabler and the result is higher output from the asset that we already have and the target is always the same, reduce energy consumption, improve yield, reduce costs and add more capacity to redirect volume to more specialized product with higher value. This gives earnings in the short term and stronger specialization and competitiveness over time.

Every initiative is tracked from potential to realized run rate with a strict cost discipline. As an example, in the 2025 portfolio identified a potential of NOK 270 million, and we realized NOK 140 million through more than 50 different initiatives. We have a strong track record, and we still have a pipeline to take out. And the same applies for 2026.

In Sarpsborg, we have 3 kilometers with connected plants and around 20 production units. The biorefinery is fully integrated with steam, biogas and energy systems, which gives cost and quality advantages. The biorefinery is also set up with its own caustic soda plant, sulfur dioxide plants, water works and wastewater treatment plants. All of these units are physically and technically connected and make the biorefinery highly self-sufficient. In addition, one improvement, one place, changes conditions for several others, creating an accumulation of returns. Keep this picture in mind for the next two slides as we talk through the expansion and energy.

The expansion investment in Sarpsborg is a clear example of continuous improvement translated into value. An expansion that delivers improved mix, flexibility and returns. And those are the key takeaway messages. It builds on the principle of creating more value from the same asset base. The benefits do not come from volume alone, but improved product mix, lower energy and chemical consumption as well as improved yield. The project is progressing according to plan, and the main benefits will materialize gradually from second quarter of 2027.

First, the de-bottlenecking itself. It has an expected capacity increase of 5% to 10% from second quarter of 2027. It is at low risk, which is in an asset that we already own and an investment with a well above return requirement of 15%. Secondly, it creates greater flexibility between products, markets and larger share of higher value specialization in the mix. And that is an important strategic point. This is not a volume investment alone. Thirdly, the expected developments towards 2030 is higher earnings from mix and volume and lower costs from improved yield, energy and savings and lower chemical consumption. The figure to remember is the 5% to 10% capacity increase and the return of above 15%.

The chart puts number to it. We have averaged about 153,000 tonnes over the past 5 years, and we expect to reach around 165,000 tonnes from 2027 and onwards. 2026 is a transition year, and that's why the line is dashed. And below, you see the specialty projects following the de-bottlenecking. We will increase the specialty capacity in both lignin and cellulose by 15,000 tonnes and 10,000 tonnes, respectively. In short, more volume, better mix and lower unit costs from the asset that we already have.

Our Climate investments are about much more than just climate solutions. Our Climate investments have been even more profitable than expected. They have given lower emissions, lower energy costs and higher energy flexibility. The mechanism is quite simple. Electrification and more use of own biomass replaces fossil natural gas. 30,000 tonnes of CO2 are removed to date with around NOK 45 million lower energy costs for 2026. And we have a further potential of 35,000 to 60,000 tonnes of CO2 per year. This comes from specific projects in our existing assets and where our own people continuously look for better ways of operating. The completed projects are already delivering sustainable cost reductions alongside significant emission reductions. And our pipeline follows the same logic, lower emissions, lower cost and higher flexibility.

Digitalization and AI is the next step in our continuous improvement work. Not technology for technology's sake, but to capture more value from the asset that we already have. Reliability and data-driven decisions are already a part of how we work. Today, sensors and process data give early warnings of deviations and enable smarter maintenance. AI turn data into decisions that we can act on, gradually into more autonomous process optimization. This means higher up-time, improved yield, lower energy consumption and fewer unplanned disruptions. In specialty business, stable operations directly protects volume, quality and deliveries to customers.

To summarize, we have a biorefinery and a global network that are almost impossible to replicate. We have an improvement culture that converts potential into realized run rate and a disciplined investment pipeline in an asset we already own. Everything we have been through points in the same direction. More capacity and a better mix from Sarpsborg, one operating model across our sites, cost and energy disciplines that protects margin and digitalization and AI that raises uptime.

In short, manufacturing deliver higher earnings, stronger cash flow and better results. And this completes my presentation.

Thank you, Ole Gunnar. Then our final speaker today is Per Bjarne Lyngstad, our Chief Financial Officer. Per Bjarne joined Borregaard back in 1988 and was appointed CFO in 1998. Prior to that, he held a range of finance and administrative positions within Borregaard. He holds a graduate degree in economics and business administration and brings nearly 4 decades of experience with the company. Per Bjarne will now take us through our financial ambitions for profitable growth.

Thank you, Tom Erik, and good morning, everyone.

Over the next 20 minutes, I will take you through Borregaard's financial development and key drivers behind our performance and the ambitions that guide us towards 2030. I will start by looking back at our performance over the past 5 years, both for Borregaard in total and for the 3 business areas.

I will then discuss our ambition for revenue growth and EBITDA margin, which together support a significant improvement in earnings towards 2030. Next, I will cover cost development and our continued focus on cost discipline, our investment forecast and the strong financial position that provides a solid platform for future growth. Finally, I will touch on our dividend policy and capital allocation priorities.

We have delivered a strong financial performance and profitable top line growth over the past several years. Since 2021, operating revenues have grown by an average of 7.4% per year, while EBITDA has increased by more than 8% annually, all years with a consistently high EBITDA margin. We have also achieved a pre-tax return on capital employed above our 15% target throughout the period. And earnings per share have increased from NOK 6.95 to NOK 8.67 if we exclude impairments on bio-based start-ups in 2025. We have achieved these results in a period with significant uncertainty in the global economy and a challenging business environment due to the COVID-19 pandemic, the wars and conflicts in Ukraine and the Middle East and increasing trade barriers.

Our solid performance reflects the benefits of continued specialization and diversification, productivity improvements and profitable expansion and environmental investments. Underpinning this performance is our resilient business model and diversified market strategy that have enabled Borregaard to adapt to changing market conditions and continue to create value over time.

Since 2021, all 3 business areas have delivered strong earnings growth and maintain attractive margins. In BioSolutions, the significant EBITDA improvement in 2024 and 2025 was driven by strong sales to the agriculture sector, supported by rising demand for multi-active ingredients in Crop Protection and the reauthorization of Borregaard's lignin for use in animal feed in the EU.

EBITDA in BioMaterials increased by almost 80% during the period. Higher sales prices and improved product mix driven in particular by increased sales of high-purity cellulose to regulated applications in food, pharma and home care and personal care as well as to bio-based plastics have more than offset higher wood, chemical and energy costs.

In Fine Chemicals, the bioethanol business had 2 very strong years in 2023 and 2024, driven by EU incentives for biofuels and increased sales prices. As additional supply, particularly from agricultural waste entered the market late 2024, prices for advanced bioethanol came significantly down and normalized in 2025. Over the 5-year period, both bioethanol and Fine Chemical Intermediate businesses have implemented measures to increase capacity, resulting in higher sales volume.

The past 5 years have been one of the most volatile and unpredictable periods in the past 2 to 3 decades. Even so, we have delivered a solid top line growth of close to 8% for reported numbers and about 5% if we adjust for currency hedging and fluctuation in exchange rates. In general, this growth has been driven by our specialization strategy, product mix improvements and price increases.

In BioSolutions, we have successfully optimized sales and product allocation to compensate for lost raw material supply in South Africa, Spain and the U.S. BioMaterials has demonstrated a strong ability to adapt pricing to changing market conditions while steadily improving its product mix. This has included ongoing quality improvements and increased sales into regulated applications. Within Fine Chemicals, sales volumes have gradually increased as we have continued to debottleneck production capacity for contrast agents intermediates and for bioethanol.

For Fine Chemical Intermediates, we have also improved our product mix and increased prices. Historically, we have been reluctant to provide a specific top line growth target for Borregaard as several important drivers of revenue, including currency movements and broader macroeconomic and geopolitical conditions are outside our control. That said, we believe the time is right to be more explicit about our ambitions and provide clearer guidance to both investors and to our own organization.

We see further growth potential through continued specialization, expansion in high-value applications, increasing demand for bio-based alternatives, a sharper execution and capacity expansions from ongoing and planned investments. Pricing will remain an important value driver. Taken together, these factors support our ambition to deliver average annual top line growth of 5% through the business cycle adjusted for currency movements. The chart illustrates the sensitivity of revenue growth to changes in volume, pricing and currency. The value of additional volume depends on how specialized the additional volume is.

Currency remains the most volatile factor affecting reported revenues longer term beyond our up to 3 years hedging horizon. With approximately 95% of sales generated in foreign currencies, a 1% change in the Norwegian kroner will have close to 1% impact on reported revenue longer term. This is why our ambition is stated excluding currency effects.

Over the past 5 years, we have delivered a strong and stable EBITDA margin despite a period of significant uncertainty and volatility. This reflects the strength of our business model, our culture for continuous productivity improvement and innovation, our increasing specialization and the benefits from expansion and environmental investments. In 2026, we have seen some headwinds, including a stronger Norwegian kroner and higher energy-related costs, particularly following the conflict between Iran, Israel and the United States. Should the stronger NOK persist, our hedging strategy will help mitigate the impact over the next 2 to 3 years, giving us time to adapt and continue executing our strategy.

Taken together, we believe these factors position us well to maintain attractive margins. Our ambition is to maintain an EBITDA margin of 25% through the business cycle, assuming no major changes in foreign exchange rates. It is supported by profitable revenue growth and continued cost discipline, productivity improvements and investments that strengthen both competitiveness and sustainability.

As we have discussed today, we operate in markets that are affected by global economic conditions, raw material and energy cost fluctuations, inflation and currency movements. The chart illustrates the sensitivity of EBITDA to changes in some of these key factors. At the same time, we have several mechanisms that help us reduce volatility. These include longer-term sourcing agreement, captive production of energy and caustic soda, a flexible energy system and a predominantly Nordic and Northern European supply base.

In addition, our currency hedging strategy delays the impact of larger exchange rate movements. Looking ahead, assuming the current currency situation, we expect gains from our current hedging positions to gradually decline over the next few years. Our ambition is, therefore, to offset this through continued improvements in the underlying profitability of the business. Combining our top line growth ambition of 5% with a 25% EBITDA margin implies an EBITDA improvement of about NOK 500 million from 2025 to 2030 based on exchange rates that we have seen so far in 2026.

As I said, we operate in a volatile environment where geopolitical developments, energy prices, weather conditions and supply disruptions can all impact our cost base. In 2026, wood prices are reduced by about 15%, resulting in a cost reduction of between NOK 120 million and NOK 130 million compared with 2025. Energy costs have moved in the opposite direction. Around 80% of our -- of our energy needs are covered by long-term contracts and internal steam production, limiting our exposure to market volatility.

For the remaining 20%, we rely mainly on short-term prices for electricity and liquefied natural gas, LNG. Based on current LNG and electricity spot and forward prices and assuming this persists throughout the year, we estimate an increase in short-term energy costs between NOK 100 million and NOK 120 million this year, offsetting to a large extent, the savings on wood. The total energy costs are expected to increase by between NOK 100 million and NOK 140 million compared with 2025. That means an additional about NOK 20 million.

We have recently seen a sharp increase in sulphur prices as a consequence of the latest Middle East conflict. For this year, we expect an additional cost of between NOK 50 million and NOK 60 million compared with 2025 if current price levels persist. Pricing for most other raw materials, chemicals and freight are relatively stable, not at least thanks to longer-term contracts. At the same time, our ongoing cost improvement program targets NOK 150 million in savings, helping to offset cost inflation and protect margins.

More importantly, Borregaard is well positioned to manage this fluctuations through our strong market positions, long-term supply contracts, captive production, operational flexibility and a predominantly Nordic supply base, reducing both cost volatility and supply risk. Taken together, these measures give us confidence in our ability to navigate a more volatile cost environment while continuing to improve our underlying earnings.

One of our financial objectives is to keep replacement investment at depreciation level, excluding depreciation from leasing. As you can see from the illustration, replacement investments will continue to be slightly above our target. As Ole Gunnar talked about in the previous session, we continue to invest in climate projects to meet our 2030 CO2 emission target. These investments will, in addition to CO2 reduction, also reduce our exposure to energy volatility and support further specialization. We expect that both completed and ongoing and planned climate investments will be profitable.

In addition to climate investments, we will invest in productivity improvement, including in equipment utilizing best available technology and artificial intelligence. A large portion of our replacement investments will be done to maintain and improve our valuable assets, including environmental investments to further reduce effluence and emissions. Expansion investments have to meet our target of at least 15% internal rate of return pre-tax to be approved. The main project for this year and into next year is the debottlenecking in all the Sarpsborg biorefinery, which will increase our capacity for specialty cellulose, lignin-based biopolymers and bioethanol.

In addition, we plan to do several projects to further specialize our product offering. There are, of course, uncertainties in these estimates related to final decision, execution, payment schedules, among others. Borregaard has, over time, generated a strong cash flow from operating activities and maintained a solid capital structure with financial ratios well within investment-grade levels.

Annual cash flows varies mainly due to changes in net working capital. Our net working capital ratio has increased in recent years, driven primarily by higher inventories supporting increased specialization and by higher government grant accruals. Despite the recent increase, we continue to target a 20% ratio of net working capital over operating revenues longer term. The equity ratio has remained above 50% over the past 5 years, while the leverage ratio, net interest-bearing debt over EBITDA has been between 1 and 1.2, well within our targeted range of 1 to 2.25. The strong financial position provides a solid platform for further growth investments and environmental projects.

Our dividend policy is to pay regular and progressive dividend based on long-term earnings, free cash flow and investment opportunities. Earlier this year, we increased the payout range from between 30% to 50% to between 40% to 60% of net profit. Since listing in 2012, the dividend has increased significantly and was almost 5x higher for 2025 than at the time of listing. Looking ahead, capital allocation will remain focused on value-creating investments in our existing businesses while continuing to provide shareholders with regular and growing dividends.

I will then leave the stage to Tom Erik for him to briefly sum up the key takeaways from today's presentation.

Thank you, Per Bjarne. So let me then briefly bring together the key messages from today. We have shown today that Borregaard has attractive and tangible opportunities across the BioSolutions and the BioMaterials businesses. In BioSolutions, we will build on our market-leading positions, strong innovation pipeline and deep application expertise. We will scale proven solutions, expand into underpenetrated markets and continue moving the portfolio towards higher-value applications.

In BioMaterials, we will further strengthen our position in premium and regulated markets, supported by targeted capacity expansion and continued improvements in product and customer mix. Our manufacturing platform enables these ambitions through continuous improvement, debottlenecking, energy investments and increasingly data-driven operations, we will create more capacity, improve productivity and strengthen Borregaard's overall competitiveness. And finally, as you've heard from Per Bjarne, we have clear financial ambitions and a disciplined approach to investment and capital allocation.

We are building on established leadership positions, proven technologies and deep capabilities, supported by a business model that has delivered attractive results over time. This gives us the confidence in our ability to deliver profitable organic growth, maintain strong profitability and generate attractive returns. We know what works. The opportunity now is to do more of it.

That concludes the presentation part of Borregaard Capital Markets Day 2026. I would like to take the opportunity to thank all of you for taking the time to be here with us today and joining in on the webcast. Thank you for your continued interest in Borregaard and the opportunity we have to share with you how we intend to create value going forward.

I would now like my colleagues from group executive management to join me on stage for our final Q&A session. And Elliott and Ole-Petter will once again moderate the discussion.

Following the Q&A, those of you joining us here in Oslo are warmly invited to lunch at Glasshuset upstairs, I think, in Oslo Concert Hall. So Knut-Harald, Gisle, Ole Gunnar, Per Bjarne, please join me here on stage.

Thank you very much, Tom Erik and the Borregaard team. We'll just open Q&A. [Operator Instructions] so maybe I can start. In terms of the financial ambitions, very helpful top line ambition of 5% growth. Is there any way you can break down for us essentially how much of that growth could come from volumes, how much from pricing, how much from mix effects? In other words, does it include volumes that are not just debottlenecking, but potentially further out in time? Or any type of color on that would be helpful.

I would say that the major part has to come from further specialization. That means product mix improvements. The debottlenecking, if you can do the calculation based on the sensitivity, will, I think, initially contribute with a top line growth of NOK 200 -- plus/minus NOK 250 million and growing to about NOK 300 million. So it's an important part, but it's not the largest part.

But we will also gradually increase the capacity for some specialties. For instance, ICE Bear is really, but that will improve the product mix mainly not the total capacity. So the big question mark is, of course, pricing, and that depends more on markets. But of course, we have to do price increases at least in line with GDP, and then we will see what more we can do in the years to come. But I think the most important thing is what we have talked about most today is about specialization, product mix improvement.

And on that target, do you think the NOK 300 million in growth CapEx that you are planning from 2029 will be enough to facilitate that growth going forward? Or do you think you need to spend more to achieve that growth?

That's 2029 is a bit ahead. We have quite concrete projects in the nearer future. The further out in the period, the less concrete it is, but we have quite good ideas of what we will do in '29. It might become a bigger number, but that depends on how the world around us moves also.

I just mean if you put that into our model, then you will see some overcapitalization at some point. How do you -- should we think about that capital allocation in time when the investment period now is done?

Yes, if you have overcapital, what we have done in the past is mainly to give extraordinary dividend. We can also look at initiating a buyback program, but let's see that, that really happens. Let's hope you have good projects that really the investors appreciate and that we can spend money on those. So that's really the flexibility.

And then maybe one from me back to BioMaterials. In the U.S., there's been some pretty aggressive competition out there in recent times in terms of pricing. Could you maybe provide some color in terms of how that could enable market share capture over there for yourself or not?

Yes. There's been a lot of discussion about that in the market. And first of all, I must remind you that we carry through quite substantial price increases from '24 to '25. To defend our EBITDA and to increase volumes in select segments, we actually, on an average, reduced our pricing somewhat this year.

But the main target for us all the time is to maximize the EBITDA and the contribution margin. And I must say, which is something I'm not going to go into detail with, price is not always telling the whole story because we have significant differences in the run rate of different Specialty Cellulose qualities. And that is also a very important element when we adapt to the current market situations. So I think I'll stop with that.

And in your presentation, you stated that customer qualification could take a long time, especially in regulated applications such as food and pharma. Could you sort of quantify how much longer it takes for those qualification processes and how much stronger the margins could be in those markets?

Well, when it comes to qualification time, it can take up to 2 to 3 years from initial discussions until you are in a commercial supply situation. When it comes to the margins of those products, of course, it's quite big correlation between pricing power and advanced -- how advanced the products are.

So and that's, of course, why we target those segments. So it both ways really that once you're inside, you are fairly protected at least for some time.

And the second is that the margins are more attractive than the segments we are in replacing those -- the segments we are replacing with those products.

And then just back to the the pricing. You mentioned at the beginning of the year, some competition from China in selective subsegments. Could you provide an update on if there's been any dramatic changes there and what you guys have done in response to that and maybe just some share, for example?

Well, it's a twofold strategy. One is as we have touched upon several times is that we're gradually moving our volumes from the more vulnerable construction market, which is not only facing some competition from China, but also in a down cycle. We moved those volumes into the more high value-added segments, not only necessarily regulated ethers, but other applications as our plant is highly flexible.

Part of the reason that we choose to adjust prices this year was actually to, in a way, make our European customers able to compete more straight on with the Chinese imports. And that has been, I think, clearly very successful. It has stabilized the situation. And on a margin basis, it has been positive actually for Specialty Cellulose.

So of course, it will be, I would say, in any segment, continued competition from China is there to stay, whatever market you are in. And you just have to -- to the extent it is meaningful for us is to adapt prices. But the best solution will be in some segments long term to maybe replace with other products. But for the time being, I feel the situation is stable. But that said, I mean, let's see what happens when we go into next year. We haven't started those discussions yet.

We have also seen that it's given a good and stable situation with the adjustments we have done throughout the year. It's really been giving good effect for our customers. And also, it's important to bear in mind that this is not like the major chunk of our business.

When you look at our highly specialized business that we report once a year, a little bit more than half is ethers in 2025. This also varies from year-to-year. And out of that half plus about 40% goes into construction. So then you can calculate that this is not the major share of the business, important to be aware of.

On to another topic. We haven't heard about the Exilva product in a long time. Can you provide an update on this?

Yes. We have been working on this for a long time, as you know. But we have -- as we have done with other things, we have also put sharper priorities in this project. We have reallocated resources. We are focusing more selectively on those fewer applications we believe has the highest probability of success. And throughout the year, we have seen positive, very positive developments in those areas.

So that means we have not thrown in the towel here. We're still going. And as you know, Borregaard, we are a long-term company, and we feel there's something here that we really fully want to understand and make sure that we have done our best to develop if we're able. So good progression with that sharpened priority, but we will get back and report when there is significant enough for you to hear about it.

And then one more here. I think you've touched upon some of these points, but with a number of attractive organic growth projects ahead and a strong balance sheet, how should shareholders think about the capital allocation priorities between reinvesting in the core business, pursuing adjacent growth opportunities and returning capital through dividends and buybacks?

I think I answered that. If we have good growth and then we have some ideas when we go into '28, '29 that is not included in the portfolio. We might look at that. But if we are not successful there, we will probably allocate more to shareholders. But we will continue to increase our dividend. I'm quite sure on that every year.

Did you also mention bio-based? Or did I not get your question correctly?

Not. Not bio-based. Just adjacent growth opportunities and returning capital through dividends and buybacks.

Yes. It was just on bio-based. As you have seen over the last year, we have taken down our exposure significantly. And as per now, we will not take on any new investments into the inorganic growth area. We will focus on those we have left and with the exposure we have. So nothing new coming into that portfolio. That's also part of the sharpened priority.

On the debottlenecking project, could you just touch on what you have completed in this process and what remains to sort of get a grasp on what the key risk to the potential delays or CapEx overruns there?

Yes. What I can say is that the major components are at the place. So we brought in the major components that will eventually bring the expansion forward. And now it's more likely closing up that major components, which lowers the risk a lot of that project.

Yes. So Q2 '27 is when we see the gradual startup.

But no impact from the new equipment as of today.

And then just piggybacking on that. When you say gradual improvement, is that a matter of quarters or a matter of years?

Could you repeat the question?

So we're getting a ramp-up gradually from Q2, would you expect the ramp-up to last, say, 3 to 4 quarters? Or is this a much more gradual ramp-up?

No, I expect the start-up to be quite smooth actually. So I expect it within some months to deliver on the volume.

Could you touch on -- I imagine sharper priorities is a lot different within BioSolutions and BioMaterials. I think it's more customer-driven innovation in BioSolutions than it is in BioMaterials. So could you just explain how you work differently in BioMaterials to prioritize more sharply here?

Yes. The change is really not that big in BioMaterials because we have a very different structure. We have -- if you take the 10 biggest customers, that situation is quite stable over the years. So we tend to have long-term projects with these customers where we focus on the parameters that we often discuss on viscosity, on purity yes, minor adjustments of the product.

So that's really our R&D effort, which partly goes on in the lab and partly in the plant and partly at the customer site where they qualify the modifications. So we are not really changing our strategy compared to biopolymers. We are actually more continuing the way we have been working for many, many years and which is highly appreciated and rewarded by our customers.

And on the positive thing is actually that, as I commented, as there are a lot of things going on in the market, we actually see an increase from our customer side and increased interest to qualify Borregaard as a second supplier. So I think we will not do anything different. And if you go more detailed into the innovation rate, which we haven't done here, we see that the BioMaterials is actually dragging that percentage up.

And by the way, this also means that when we sharpen our focus, we don't increase our costs. I mean we are doing this with the same set of people that we have been working with for many years really. So we don't really need to hire additional resources to make more advanced products.

And then just on to working capital, which is notoriously quite tricky to approximate going forward, but it's been a bit higher than the target, but you're maintaining the target of 20% I think you mentioned that the rationale for being above the target is due to some specialization products, but you're obviously not stopping with that journey. So can you just explain maybe the pathway to kind of get down to the 20%?

Yes, it's mainly about the markets. And of course, we are in many markets in a difficult situation now, construction market, maybe in particular, but some other markets and you have all the uncertainty and volatility in the world, which really should -- if things calms down at some point, you should see better markets and then you would see inventories moving down again. That's the particular partner that has to go down.

And Borregaard, of course, we are dependent on the pulp mills and what they produce for the lignin operation. And the strategy for our lignin business has always been to -- instead of pushing volume into the market, we use inventories to regulate the market. And we are in a little bit in that situation also now.

So -- and I think they will, at some point, normalize, maybe not down to 20% because specialization drives also inventory levels. But I think it's the markets that are a bit depressed in some respects for the time being.

Just 2 questions on Fine Chemicals, if I may. So first on bioethanol. With the volatility and geopolitical uncertainties you have seen, are you considering changing the way you're pricing your products from annual contracts into more index-linked pricing or in other ways than you are currently seeing?

You're asking about bioethanol? Well, bioethanol is a highly commoditized market these days. So as we have said repeatedly, the 2, 3 golden years, they are over. And our product is no more back to a more commodity status, but there is a certain premium compared to conventional bioethanol and that's it. There are no really sudden opportunities. So we will keep on mainly contracting on a yearly basis also because this is a high-volume product that we store in tanks at Borregaard, and we need to be sure that we are moving it continuously, so we don't kind of stress up the production situation.

So there are really no big advantages as I see it to be more optimistic and spot oriented in that market. So I think what you see now is what you will get also in the future. We are back to a more normal situation. The great thing is really that we were ready to grab that opportunity when it came along these 2, 3 years because not everybody were in a position to do that. So we should count the money we put into the basket in those years and expect a more flat development in the years ahead, although we get some effect of that volume expansion as we have been talking about.

And also in the Fine Chemical Intermediates, could you touch on new opportunities there? Is that primarily additional volumes for existing customers? Or do you see new products coming on stream here as well?

Which area was that -- in Intermediates? It's mainly the same customer base, increased volumes and also over time, a shift to selling more volume in Europe and less in Asia where the competition is a bit tougher.

And yes, just staying on Fine Chemicals. Obviously, the gas oil spreads globally are very, very high. A lot of the other refiners probably making a lot of money. So you're saying that there's not really a read across potentially with what we're seeing in the current market to the bioethanol side of things going forward?

I mean the main volume here is a big commodity volume from the U.S. and Brazil. And so far, there are some movements caused by the energy situation, but it's not really making a huge difference when it comes to the pricing of our modest volume.

Back to the financials on the cost side, because you stated that your longer-term contracts help reduce impact on other raw materials. Are these mainly dominated by annual contracts or are more like 5-year 10-year contracts?

And if they are to be renewed at current levels, would that be a material step up? Or how is -- could that impact?

No, of course, we have a variation in the length of contract. If you talk about electricity, there, we have historically had up to 10-year contracts. We have most of our contracts today, they are to 2030 to 2033. And we are renewing parts of that portfolio gradually.

For most other raw materials, it's either an index for the next month or the next quarter. And for transport costs, for instance, it's more annual contracts on the freight rates. And that's probably why we haven't seen the effect of freight rates in our accounts for this year really yet because we have contracts.

And then just one more on the investment forecast side of things. It looks like around NOK 1 billion in expansion CapEx from 2027 to 2030. Could you potentially just maybe break down segmentally what that refers to in terms of BioSolutions, BioMaterials, and Chemical, is that hard to do?

The debottlenecking is, of course, a big number this year and next year. The total investment is close to NOK 800 million. And of course, some of that has been paid out already or were paid out in 2025, but that's a big chunk of it. And to mention some projects, we have the ICE Bear, we are putting more money into today's ICE Bear technology on the BioMaterials side.

We have some -- we have the U.S. upgrade of the facility there. We are doing a few things in Fine Chemical Intermediates really to increase volume there. But there will be -- the rest will be smaller, medium-sized projects, add-ons in the different business areas. To give you a split, it's even harder the further ahead you go. So I don't think I will go into that because the world will change when we get there. So it's more a frame of how much we can invest really. And then the world around us will tell us whether we can do more or have to do less.

A final one from me. You have identified NOK 130 million of unrealized improvements potential. When should we expect to see this feed through the P&L?

What we should expect from it next year or...

No. But we were talking about the productivity improvements, Ole Gunnar is talking about, and that will see through the P&L. And then the cost program, which is mainly about what we call fixed cost, is a different issue.

Unless there's no further questions, I think that can conclude the Q&A for the day.

Good. Thank you very much again, everyone, and thank you to our moderators.

Good morning, everyone, and welcome to Borregaard's Second Quarter 2026 Presentation. My name is Tom Erik Foss-Jacobsen. I'm the CEO of Borregaard, and I'll be joined today by our CFO, Per Bjarne Lyngstad. Together, we will take you through this agenda.

I will start with the key highlights for the quarter and then give an update on the market situation across our business segments. I will then summarize the outlook before handing over to Per Bjarne. He will walk you through the financial performance then in more detail.

Before we begin, just a quick reminder to those of you watching the webcast that you are welcome to submit questions at any time during the presentation, and we'll address them at the end.

Let's begin with the highlights for the second quarter. EBITDA came in at NOK 515 million compared with NOK 522 million in the same quarter last year. This is a solid result broadly in line with a strong second quarter last year and also supported by good operational performance in the quarter.

Looking at the business areas, BioSolutions delivered higher sales volume, but with a less favorable product mix. BioMaterials had high deliveries and record production, while Fine Chemicals delivered another quarter with solid results.

On the cost side, we continue to see pressure from higher energy, logistics and chemical costs, partly offset by lower wood costs. The net currency effects were slightly positive in the quarter. We have also recognized an impairment of NOK 337 million on our investment in Alginor. The 3 main shareholders in Alginor, Borregaard, Must Invest and Hatteland with Hatteland acting as lead investor have offered Alginor to guarantee for NOK 100 million of new equity. This is subject to corporate approvals in Alginor. Borregaard has committed to subscribe for up to NOK 10 million of this capital injection, which will reduce Borregaard's ownership interest in Alginor from 42% to 10%.

Following this transaction, Borregaard will not have any obligation to contribute to further funding of Alginor. Borregaard also had a robust cash flow in the second quarter. Overall, the quarter has demonstrated the resilience of Borregaard's diversified business model, while also highlighting the importance of continued focus on product mix, cost discipline and execution.

Now let's turn to BioSolutions. Sales volume was 4% higher than in the second quarter last year. This was driven by high deliveries to construction and industrial applications. At the same time, the product mix was less favorable than in the corresponding quarter last year. However, sales to specialties improved compared to Q1 this year.

The average price in sales currency was 1% above second quarter last year, reflecting broadly stable sales prices. However, the average gross sales price in Norwegian kroner was impacted by the weaker U.S. dollar and euro. Compared with the first quarter, we saw a recovery in volumes, but not yet a full normalization of the mix.

In Q1, we explained that certain specialty volumes were affected by temporary delays in the value chain, broader uncertainty and customer destocking. At this stage, the main message remains that we see variability in timing and mix rather than a structural change in the underlying demand.

Then over to BioMaterials. Sales volume was 9% higher than in the second quarter last year. This was driven by high deliveries of specialty cellulose. This was also supported by a record-high production in the quarter. At the same time, the average price in sales currency was 4% below second quarter last year, reflecting targeted price adjustments in the cellulose ethers construction segment, which contributed to higher sales volumes. In addition, the average price was impacted by less favorable product mix. As in BioSolutions, the average gross sales price in Norwegian kroner was also impacted by the weaker dollar and euro. Overall, the quarter demonstrates strong demand and solid operational performance.

Turning to Fine Chemicals. Fine Chemicals delivered a strong quarter with solid contribution from both intermediates and good deliveries in bioethanol. The Fine Chemical intermediates delivered a favorable product mix and higher deliveries this quarter. Bioethanol also had high deliveries. The operating revenues were higher than in the same quarter last year, supported by this volume and mix effects.

Then I will conclude my part with the outlook. In BioSolutions, sales volume for 2026 is now forecast to be approximately 335,000 tonnes, slightly down from 340,000 tonnes in the previous outlook. Sales volume in Q3 is expected to be around 85,000 tonnes. In BioMaterials, sales volume for 2026 is expected to exceed 160,000 tonnes, up from the previous outlook of 155,000 to 160,000 tonnes. We expect the sales volumes of highly specialized grades to be higher than in 2025 and the Q3 sales volume is expected to be around 40,000 tonnes.

In Fine Chemicals, sales prices for Borregaard's bioethanol are expected to be largely in line with 2025. Sales volume for Fine Chemical intermediates is expected to increase compared with 2025. However, bioethanol deliveries are expected to be lower and the product mix for the Fine Chemical intermediates is expected to be weaker in the second half compared with the first half of 2026.

Looking at the costs. The wood costs in the second half of 2026 are expected to be 3% to 4% lower than in the first half. At the same time, the global uncertainty continues to impact cost of energy, key chemicals as well as our markets and currencies.

Given a more demanding operating environment, we are implementing a cost improvement program, targeting annual cost savings of NOK 150 million. The savings are expected to be realized gradually with full annual effect from 2028. This reinforces our focus on execution and cost discipline to protect profitability and also to support the next phase of specialization and value growth that we are planning for.

With that, I'll hand over to our CFO, Per Bjarne Lyngstad, who will take you through the financial performance in more detail. Thank you.

Thank you, Tom Erik, and good morning, everyone. In the second quarter, Borregaard's operating revenues increased by 3% compared with the second quarter of 2025 as a result of higher sales volume in all areas. EBITDA ended at a solid NOK 515 million compared with NOK 522 million in the second quarter last year.

The result in BioMaterials and Fine Chemicals increased, while BioSolutions had a lower result. Wood costs were about 15% lower compared with the second quarter last year. The Middle East conflict had a negative impact on energy, logistics and chemical costs. The net cost impact on raw materials, energy and logistics was negative by about NOK 40 million compared with the same quarter last year.

We estimated a net cost impact for -- to be between NOK 40 million and NOK 60 million in our outlook for the second quarter. The net currency effects in the quarter were slightly positive by about NOK 5 million. The EBITDA margin ended at 24.4%, about 1 percentage points lower than in the margin in the second quarter of 2025, but with a 3 percentage points improvement from the first quarter.

In the quarter, Borregaard has recorded, as Tom Erik said, a NOK 337 million impairment of the Alginor investment and accrued NOK 30 million for ground stabilization measures at the Sarpsborg site. These 2 items explain why earnings per share ended at minus NOK 1.27 in the quarter.

Adjusted for these 2 items, earnings per share ended at NOK 2.35 in the quarter and NOK 4.17 year-to-date. As to Alginor, based on recent developments and a challenging financial situation in the company as well as proposed share transactions between Borregaard and the Hatteland Group, we now consider the shareholding in Alginor and convertible loans to the company to have no recoverable value.

Accordingly, we have made an impairment to reduce the value of the total investment to 0 at the end of the second quarter. The impairment is recorded as a financial item. As Tom Erik said initially, we have committed to subscribe for up to NOK 10 million of the proposed NOK 100 million equity injection in Alginor, reducing our ownership interest in Alginor from 42% to 10%.

In connection with Ostfold County's planned construction of a new bridge across the Glomma River, the county has identified a requirement for ground stabilization measures at the Sarpsborg site to mitigate the risk of landslides. From Borregaard's side, the measures are intended to minimize the risk of additional requirements from the county, which could affect Borregaard's day-to-day operations at the site. An accrual of NOK 30 million has been recorded for these measures in other income and expenses.

Then turning to BioSolutions. The operating revenues were in line with the second quarter last year. EBITDA was NOK 306 million compared with NOK 338 million in the same quarter last year. Higher sales volume was more than offset by higher energy and energy-related costs, negative net currency effects and a less favorable product mix compared with the second quarter of 2025.

The EBITDA margin was 26.5% in the quarter, close to 3 percentage points below the margin in the second quarter last year, but 2 percentage points higher than in the first quarter this year.

BioMaterials' operating revenues in the second quarter were 4% higher than in the second quarter last year, mainly as a result of high deliveries of specialty cellulose. EBITDA reached NOK 151 million, NOK 8 million higher than in the same quarter last year. High deliveries of specialty cellulose were partly offset by lower sales prices and a weaker product mix. Our record production contributed positively to the result.

Lower wood costs were more than offset by cost increases mainly related to energy and certain chemicals. Net currency effects were positive for BioMaterials. The EBITDA margin of 19.5% in the quarter was marginally above the margin in the second quarter last year, but 5.5 percentage points higher than in the first quarter.

Operating revenues in Fine Chemicals increased by 18% compared with the second quarter of 2025, mainly due to higher deliveries. EBITDA reached NOK 58 million, NOK 17 million above the second quarter last year. The result improvement was due to higher deliveries and a favorable product mix for Fine Chemical intermediates as well as high deliveries of bioethanol. Net currency effects were positive for Fine Chemicals.

The EBITDA margin increased to 29.3%, about 5 percentage points higher than in the same quarter last year. The net currency impact on EBITDA was, as I said, slightly positive by about NOK 5 million compared with the second quarter last year. Hedging gains were NOK 74 million compared with a loss of NOK 34 million last year. The positive impact from the change in hedging effects was largely offset by the impact from a stronger Norwegian kroner. Using Borregaard's currency basket, the Norwegian kroner was more than 8% stronger compared with the second quarter of 2025.

Using currency rates as of yesterday, the net currency impact for the full year is now estimated to be positive by about NOK 45 million compared with the full year of 2025. The corresponding impact for the third quarter is estimated to be positive by about NOK 10 million compared with the third quarter last year.

Borregaard had a cash flow from operating activities of NOK 695 million in the second quarter. The strong cash flow was due to a significant reduction in net working capital in addition to the cash effect from a solid EBITDA. The impairment loss related to Alginor had no cash effect in the quarter. Investments were NOK 194 million in the quarter. The largest expenditures were related to the upgrade of electricity transformation capacity and the debottlenecking project at the Sarpsborg site as well as capital raises in Alginor.

Net interest-bearing debt increased by NOK 16 million in the quarter. The dividend payment of NOK 475 million in April was more or less offset by the strong cash flow. At the end of the second quarter, Borregaard is well capitalized with an equity ratio of 59% and a leverage ratio, which is net interest-bearing debt over EBITDA of 1.2.

That concludes today's presentation. We would like to use the opportunity to promote Borregaard's Capital Markets Day, which will be held on the 17th of September at the Oslo Concert Hall.

Tom Erik and I will now be ready to answer any questions from those who follow the webcast. Our Director in Investor Relations, Pal Espen Ramberg, will moderate webcast questions.

Thank you, Per Bjarne. The first from Kristoffer Haugland at Arctic. Have you seen a shift in the demand for agricultural products within BioSolutions following the lower urea prices?

I would say the -- as I said in our presentation, we see some improvement in specialty sales and also agri sales in the second quarter versus the first quarter. Overall, we have -- agri is based on 1,000 customers, doing different products, a wide variety of applications. We have several applications that are developing positively. Plant nutrition is running well. We have granulation aid where we are supporting with our products, animal feed. One application where we still see effects from the situation, also referred to last time as the Middle East, where costs have been increasing and availability has been impacted is within crop protection. And here, we still see some impact on the sales in the second quarter.

Thank you. Another one from Kristoffer Haugland at Arctic. Could you please provide some more details about the improvement program?

Yes. The improvement program is based on a few measures that we are taking. It's about cost reduction. It's also about increasing our overall competitiveness. We have implemented a general hiring freeze, which means that when people are retiring or resigning, we are not automatically replacing those people. That means there will be a reduction in manning through this period.

We are also implementing a stronger overall cost discipline. We are looking over our priorities when it comes to projects, initiatives and the way we use our resources to make sharper priorities, fewer priorities, which means we will also reduce some of the activities. So these are the measures altogether that we are expecting to give the impact of this NOK 150 million over this timeline.

The next one from Magnus Rasmussen at SEB. How come full year BioSolutions volume guidance is down despite strong volumes in the second quarter?

I would say, first of all, typically, from the seasonal effects of the different businesses we're in, we typically have a lower volume in second half versus the first half. We also saw a somewhat lower volume in Q1 versus the previous Q1. And I think we will not be able to recover those volumes lost in Q1. So I think these 2 factors together is leading us to the guidance you're referring to here.

Another one from Magnus Rasmussen at SEB. How should we look at the raw material and energy costs on a year-on-year basis for the third quarter? Is it similar to the second quarter?

Yes. The development we see, we haven't given a number this time because what's happening in the Middle East, there you see variations a lot on the oil price, depending on the actions from the parties. What we see is that some chemicals, and I think we should point that sulfur and also caustic, we see an increase or expect an increase in the third quarter.

Then whether that will be offset by the wood cost reduction is uncertain. And then the major uncertainty is really on energy prices, LNG, and we also have a situation in Norway on electricity, where the magazines, the water magazines in the mountains are quite at a low level. So we have been careful now, but maybe a little bit up from the second quarter.

Another one from Magnus Rasmussen at SEB regarding Chinese competition. How has the competition from Chinese ethers, which you highlighted in Q4 developed since then?

Yes. As we have presented earlier, we did some selective price adjustments, particularly to meet this competition. And what we can see is that our selective price adjustments have been successful and are definitely contributing to higher sales volumes within BioMaterials. So I would say our measures have been working well. And yes, I think that's the answer.

Yes. Thank you. The next one is from Martin Melbye in ABG regarding debottlenecking projects. Did the debottlenecking project deliver EBITDA in the quarter given the high volumes? Or is this effect yet to come in 2027?

No, the effect of the debottlenecking project is yet to come. So that didn't have an impact on the record production we had now. But there are other measures we have done previously that now give very good effect also on the production. But whether we remain at the same high level remains to be seen.

Thank you. The next from Elliott Jones in Danske Bank. Can you provide any color with regards to the selling price development in local currencies going into second half of the year for BioSolutions and BioMaterials.

Yes. We have done certain price adjustments. We also have implemented selectively surcharges and I would say both price adjustments and surcharges where contracts have been allowing us to do so. I would say we can expect a moderate impact from these adjustments into third quarter and into second half.

Thank you. There are no further questions on the web.

Okay. Good.

Thank you for your attention.

Yes. Thank you very much.

Good afternoon, and welcome to Borregaard's pre-close call. My name is Pal Espen Ramberg, Director of 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, and 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, Pal Espen, and good afternoon, everyone. I will start with reiterating the key points from the outlook for both the full year and the second quarter of 2026. And when relevant, refer to questions and comments on the outlook given in the Q&A session at the webcast we held on the -- for the first quarter on the 29th of April.

I will start with BioSolutions, where we reiterated our expected full year's sales volume of about 340,000 tonnes. The second quarter sales volume is expected to be around 90,000 tonnes, in line with what we had in the second quarter 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 destocking 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 forecast 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. Yes.

The second question was about the mix in BioSolutions in the second quarter. Should we expect similar trends for mix and ASP in BioSolutions as in the first quarter? The second quarter last year was a very strong quarter for the Specialties. In the first quarter, we just saw the first consequences of the outbreak of the Iranian war. The consequence from the war is definitely going to impact the second quarter. 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 second quarter to be similar to what we saw in the first quarter.

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.

Then, turning to the outlook for BioMaterials, where we reiterated our expected full year sales volume to be in the range of 155,000 to 160,000 tonnes, significantly above the 146,000 tonnes 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 3% to 4% 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 to 42,000 tonnes.

There were 2 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 first quarter. Is this structural or reallocation of the lower grades sold in the quarter? In the fourth quarter report for 2025, we talked about a 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. antidumping case may also affect several specialty 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 7th of October 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 speciality 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.

Then, 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.

Then, to the outlook and the development in costs. Wood cost 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 to NOK 60 million compared with the second quarter 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. But we have flexibility to switch between natural gas and electricity. For natural gas, we have a 1-month delay compared with the market price. Electricity prices in Norway so far in the second quarter 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 higher -- more than 90% higher than last year, taking the 1-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 second quarter, more or less in line with our estimate from the first quarter 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 second quarter? As of now, the negotiations for the second half of 2026 have started, but 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? Or do Borregaard still benefit from lags of early sourcing in the cost guidance figure? Borregaard has a 1-month lag on natural gas. But 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, but we have seen some increase in the second quarter.

We were also asked to split the NOK 40 million to NOK 60 million higher cost year-on-year in the second quarter 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 to 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 will, 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 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 first quarter 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 28th of April, the net currency impact for the full year of 2026 was estimated to be about zero compared to 2025. The corresponding impact for the second quarter of 2026 was estimated to be positive by about NOK 10 million compared with the second quarter of 2025.

So far in the second quarter, the Norwegian kroner has strengthened by about 4% compared with the first quarter of 2026 using Borregaard's currency basket. Compared with the second quarter last year, the Norwegian kroner has strengthened 7% to 8%. If the present currency rates continue the rest of the month, the net currency impact in the second quarter compared with the second quarter last year will more or less be in line with the plus NOK 10 million we estimated at the first quarter webcast on 29th of April. 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 to NOK 15 million higher than the zero impact we estimated in late April.

I will now hand over to Pal 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 the 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?

Yes, 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 3 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 silenct period.

Here we have another one, finally here, from Magnus again. How much of the extra -- 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.

We will 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.

Thank you.

Good morning, and welcome to Borregaard's First Quarter 2026 Presentation. My name is Tom Foss-Jacobsen. I'm the CEO of the company, and I'll be joined today by our CFO, Per Bjarne Lyngstad. Together, we will take you through this agenda. I'll start with the key highlights for the quarter and then give an update on the market situation across our business segments. I'll then summarize the outlook before handing over to Per Bjarne, who will walk you through the financial performance in more detail.

Before we begin, just a quick reminder for those of you watching the webcast live that you're welcome to submit your questions at any time during the presentation, and we will address them at the end of the presentation.

Let's begin with the highlights for the first quarter. EBITDA came in at NOK 428 million compared with NOK 511 million in the same quarter last year. In BioSolutions, we saw lower sales volumes within Specialties compared with a very strong quarter last year. In BioMaterials, we delivered higher volumes, but this was offset by lower sales prices and a weaker product mix. Fine Chemicals delivered a strong result, supporting the overall performance in the quarter.

On the cost side, the higher energy costs and general cost inflation were partly offset by lower wood costs, and we had an insignificant net currency effect in the quarter.

Okay. Then let's turn to BioSolutions. Within Specialties, lower sales volume was partly compensated by higher sales prices. Deliveries to agriculture and batteries were lower compared again with a very strong Q1 last year. At this stage, we have no indication of a structural change in demand, but we see this rather as a temporary delay in the value chain driven by geopolitical factors, broader uncertainty and customer destocking in this period. The average price in sales currency was marginally higher with the price in Norwegian kroner being impacted by a weaker U.S. dollar and euro. Overall, sales volume was 4% lower than Q1 last year.

Moving on to BioMaterials, in the quarter, sales volume was 10% higher compared with Q1 last year. This was driven by higher deliveries of Specialty Cellulose, partly due to higher sales to the Construction segment, but also increased sales of our highly specialized products to regulated markets and bioplastics. At the same time, the average price in sales currency was 4% below Q1 last year, reflecting lower sales prices, where we also did some selective price adjustments and also a weaker overall product mix. As for BioSolutions, the average gross sales price in Norwegian kroner was also affected by a weaker U.S. dollar and euro.

Now to Fine Chemicals. For Fine Chemical Intermediates, we delivered a strong quarter, supported by a favorable product mix and higher deliveries. For bioethanol, we saw increased sales volume. Overall, this segment delivered significantly higher operating revenues, up 23% compared with the same quarter last year.

Then I'll conclude my part with our outlook. In BioSolutions, sales volume for 2026 is forecast to be approximately 340,000 tonnes. For Q2, we expect sales volume around 90,000 tonnes. We expect a less favorable product mix in Q2 compared with the second quarter last year, primarily driven by the current temporary delay in the value chain mentioned.

In BioMaterials, sales volume for 2026 is forecast to be in the range of 155,000 tonnes to 160,000 tonnes and the sales volume of highly specialized grades is expected to be slightly higher than in 2025. The average price in sales currency here is expected to be 3% to 4% lower in the first half of 2026 compared with the second half of 2025, partly due to mix. For Q2, sales volume is expected to be in the range of 40,000 tonnes to 42,000 tonnes. And as previously communicated, the preliminary decision in the U.S. dumping allegations is expected end of May.

In Fine Chemicals, the bioethanol sales prices are expected to be largely in line with 2025 and the sales volume for the fine chemical intermediates is expected to increase versus 2025. For Fine Chemical Intermediates, the delivery patterns and product mix may vary from quarter-to-quarter.

Then on the cost side, the cost development is expected as this. The wood costs in first half of 2026 are expected to be reduced by around 15% compared with the first quarter -- first half of 2025. At the same time, we see that the Middle East conflict is expected to impact our energy, logistics and chemical costs negatively. And the net cost impact from raw materials, energy and logistics is estimated to increase by NOK 40 million to NOK 60 million versus the second quarter last year, in addition then to the general cost increases.

The uncertainty related to wars, conflicts and tariffs is impacting both our markets, our cost base and also our currencies. Consequently, we are now implementing targeted measures to address the cost development. While the current supply disruptions and cost pressure on oil-based products are affecting certain parts of our markets and customers, we also believe that this may support a stronger case for bio-based alternatives Borregaard is offering and then represent a longer-term opportunity for products like ours.

Finally, Borregaard's highly diversified portfolio and broad customer base has a proven track record of providing resilience in times like this in a volatile environment and through periods of uncertainty. We also think that this will prove its strength in a period like we're seeing now.

And with that, I'll hand the word over to our CFO, Per Bjarne Lyngstad, who will take you through the financial performance in more detail. Thank you.

Thank you, Tom Erik, and good morning, everyone. In the first quarter, Borregaard's operating revenues were 2% lower than in the same quarter last year. EBITDA, as Tom Erik said, was NOK 428 million compared with NOK 511 million last year. The result in Fine Chemicals increased, while BioSolutions and BioMaterials had lower results. The lower result was mainly due to lower sales volume of Specialties in BioSolutions and higher energy and other operating costs, except for the wood cost.

Net currency effects were insignificant in the quarter. And the EBITDA margin ended at 21.3% compared with 25.1% in the same quarter in 2025. Earnings per share was NOK 1.82 compared with NOK 2.52 last year. The lower sales volume of Specialties was also the main reason for a 9% decrease in operating revenues in BioSolutions. EBITDA in this area was NOK 260 million compared with NOK 349 million last year. The lower sales volume was partly compensated by higher sales prices for Specialties. The result was also negatively impacted by higher energy costs.

In addition, the net currency effects were in this area, negative in the quarter. Due to the lower result, the Q1 EBITDA margin was 24.4% compared with 29.6% in the very strong first quarter last year.

BioMaterials operating revenues in the first quarter were 6% higher than in the same quarter last year, mainly as a result of higher deliveries of Specialty Cellulose. EBITDA was NOK 102 million compared with NOK 113 million in the same quarter last year. Again, higher deliveries of Specialty Cellulose, they were offset by lower sales prices and a weaker product mix.

Lower wood costs were more than offset by an increase in other costs, mainly related to energy. Other costs have also increased due to higher prices for some chemicals, particularly sulfur, the cost for defending antidumping case in the U.S. in addition to the general cost inflation. Net currency effects were positive in BioMaterials this quarter. And the EBITDA margin ended at 14% compared with 16.4% last year.

Higher deliveries of both Fine Chemical Intermediates and bioethanol were the main reasons for a 23% increase in operating revenues for Fine Chemicals in the first quarter. EBITDA reached NOK 66 million, NOK 17 million above the first quarter last year. The improved result was due to higher deliveries and a favorable product mix within Fine Chemical Intermediates and increased sales volume of advanced bioethanol. In addition, net currency effects were positive for Fine Chemicals in the quarter. The EBITDA margin ended at 30%, close to 3 percentage points above the same quarter last year.

As I said earlier, the net currency impact on EBITDA in the quarter was insignificant compared with the same quarter last year. A 10% stronger Norwegian kroner in the first quarter this year using Borregaard's currency basket was offset by a significant change in hedging effects. In the first quarter, we had a [ NOK 60 million ] gain on hedging compared with a loss of NOK 95 million last year. Using currency rates as of yesterday, the net currency impact on EBITDA for the full year of 2026 is now estimated to be about 0. The corresponding impact for the second quarter is estimated to be positive by about NOK 10 million compared with the second quarter last year.

Cash flow from operating activities was NOK 77 million in the first quarter. The low cash flow was due to a reduced cash effect from EBITDA and increase in net working capital and high tax payments in the first quarter. Net working capital increased mainly due to high deliveries in most areas towards the end of the quarter, resulting in an increase in accounts receivable.

Investments were NOK 161 million in the quarter. The largest expenditure were related to the upgrade of the electricity transmission transformation capacity and the debottlenecking project at the Sarpsborg site, in addition to a capital increase in Alginor in the form of a convertible loan.

Net interest-bearing debt increased by NOK 35 million in the quarter. At the end of the first quarter, Borregaard is still well capitalized with an equity ratio of 62% and a leverage ratio, which is net interest-bearing debt over EBITDA of 1.18.

And that concludes today's presentation. Tom Erik and I will now be ready to answer any questions, both from the audience present here in Oslo and from those who follow the webcast. Our Director, Investor Relations, Pal Espen Ramberg, will moderate webcast questions.

We have received some questions. The first one comes from Magnus Rasmussen at SEB regarding mix in BioSolutions. How confident are you that the weakness in agri and batteries is temporary?

As we said, we read the current picture as a reaction to the geopolitical situation intensified by the war now in Iran, which has also created a more broad uncertainty. And we see also that this drives a destocking in the value chain. We have no indication from the market, from the customers that this is a structural change in demand. Customers are keeping up their forecasts for the year.

And as such, we see this as a situation where customers are taking a cautious wait-and-see approach, where is the oil price going, where is the price on oil-related products, which they are heavily dependent on going. And that means currently, they're buying less, using what they have and take this approach. Yes, I think that's the view here.

Thank you. The next one is from Kristoffer Haugland at Arctic related to [indiscernible] and Biomaterials. [ RM ] guides 18% higher ASP for Specialty Cellulose for 85% of its volume in 2026 and more 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 here, we have locked in, I would say, the major part of our cellulose business for the year 2026. We have some flexibility on a limited part of the volume. But I think the main impact here will be when we go into 2027. I would also say that this situation may create some opportunities in the market, where we will take those as we see the opportunities. As such, on pricing, major part of the volume is locked in.

Thank you. Another one from Magnus Rasmussen at SEB related to Middle East and the raw material costs. The cost increase driven by the Middle East, is it fair current spot prices for gas sulfur? Or do you still benefit from the lags early sourcing in the cost guidance figure?

No, I would say that gas prices now for -- we have 1 month delay on natural gas. So what we will see now in April is the average March price on LNG. So there is a certain delay there. But overall, we are more or less at the present level. What we've seen also in the first quarter is very high electricity prices in Norway. and they will probably not continue at the same level because it's getting warmer. But everything points to a higher electricity price than last year, of course, depending on the weather.

So we are -- on that part that we haven't really hedged or have long-term contracts on, we are more or less exposed to spot prices on energy. Sulfur prices are on the rise. Caustic soda is relatively stable, but we expect at least some increase now in the second quarter. So all those things are involved.

On the wood side, the prices for the first half are set, but the expectation there is that wood prices should go down in the second half of the year. How much is too early to tell. So it's a mixed picture. But -- and of course, there's a lot of uncertainty in the energy price. But remember that about 80% of our energy consumption are on long-term contracts or hedged. So -- and we have flexibility between natural gas and electricity on the spot side.

Thank you. Another one from Magnus Rasmussen at SEB. How do you view the preliminary result of the countervailing duty against Brazil, which was released recently?

I would say these are technical calculations and may not reflect the final outcome. So we will wait and see until we have the preliminary saying here coming at the end of May. And countervailing duty is only a part of it. It also talks about this antidumping type on pricing. So I think it's too early to say. It's still open, I would say.

Thank you. The next one is from Kristoffer Haugland at Arctic. Spruce pulp prices are now down 26% from the peak. How are negotiations going for Q2? Mix in BioSolutions second quarter, should we expect similar trends and ASP as in Q1? And can you split the NOK 40 million to NOK 60 million higher cost year-on-year in Q2 on the different items?

Yes, I can answer through the first and then the last and we will take the middle one. On the wood price, I partly answered that. The negotiations for the second half on the wood price has not started yet. So it's a bit early. But we see that prices has come further down in Sweden. I'm sure many of you follow the statistics on the wood price coming from the agriculture department in Norway. So everything points to a decrease, but I don't dare to say how much we will see in the second half. Probably less than we saw in the -- we had a 50% reduction in the first half. It will probably be less than that, but it's early to tell.

And the last question was

Related to the split of the SEK 40 million to SEK 60 million.

Yes, the split because that's a net amount. With the wood prices, the 50% reduction in wood price, that's about roughly NOK 30 million positive per quarter. So that means that the other elements, which is mainly energy is NOK 70 million to NOK 90 million. So that's the main elements there. A part of it is also increased sulfur price, but it's not a very high part of the total. It's mainly related to what we foresee now on energy prices, the gas prices we observe in the market, which is, of course, uncertain and then what will happen with caustic also.

So then I can answer the market question related to BioSolutions product mix. We have said that we were keeping our total volume for the outlook for the year, 340,000 tonnes, and we are also keeping the volume, as we said in the previous quarter for Q2, we stick to the 90,000 tonnes. But we're also saying that we expect a less favorable mix in Q2 versus the same quarter last year. Again, a reminder that also Q2 last year was a very strong year for quarter for the Specialties.

When we say that the impact here that we believe is temporary, I mean, we have just seen the first consequences of the outbreak of the Iran war that was end of February. We have had 1 month in Q1. This is definitely going to impact Q2 as well. And in particular, we see that the Asian market is impacted more than others. We also see this on, for example, the agri market. And we also have customers in India, which is definitely one country here being impacted here.

So we will see a less favorable product mix within the same applications, as we mentioned in Q1. But we are currently believing that the second half is more back to normal. But who knows exactly the outcome of what's going on now? I mean it is a broad uncertainty. And -- but still, we believe it's temporary. How long remains to be seen.

Another one from Kristoffer Haugland at Arctic related to construction volume in Biomaterials. You highlighted more sales to Construction segment. Is this structural or reallocation of the lower grades sold in the quarter?

If you look back at our Q1 -- excuse me, the 2025 report we did, we said that for 2026, we had more intense competition in the construction part of the business in cellulose heaters and that we have done some selective price adjustments. And I would say our increased sales into construction is 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.

Thank you. The next one is from Niclas Gehin at DNB related to costs. Could you elaborate on what these targeted cost measures to address cost development are? Are price increases and surcharges also something you will consider? And when might these measures start to take effect?

Yes. For the time being, we have initiated a project that will, as I say, have targeted measures to address costs. It's too early for us to give exact details, but we will -- we will definitely look at being more restrictive on recruitments. We will be more looking at the structure and initiatives we were driving and in general, take a more restrictive approach to get costs down. But we will get back with more details on that as this is still fairly new and in progress.

The second part you asked for was -- one more time.

Surcharges.

Yes. We are discussing also this within our businesses. We're looking at the contracts, and we're looking at the impacts, and we are -- we have seen that a competitor has been out there with quite significant surcharge, and we are in discussions on this, and will over the coming months, and we will decide on how to approach it.

Thank you. The next one is from Fabian Jorgensen at Pareto related to price hikes and surcharges. How do you consider your ability to offset cost increases with hikes in price or surcharges? Your track record from 2022 is strong, but with a slower construction market, the market balance is significantly softer.

Yes. I think I already answered to the surcharge part and that we are in consideration of doing this. On price hikes, we -- I would say the situation was a bit different in '22 than versus today. with the overall market environment being a bit different. But we are also looking at, again, contracts we have with our customers and the flexibility we have to do some moves on price and with price adjustments. So this will be reported as we move on how we implement this.

Thank you. Another one from Fabian Jorgensen at Pareto related to agri sales. Is there a risk that higher fertilizer prices affect your agri sales negatively?

I think it's a bit challenged to see exactly what's going to be the outcome of the current situation. We know fertilizer prices are going sky high. Farmers will be hit by this heavily. One thing is availability. The other thing is that they will be really hit by high costs. And we think that our customers that are selling plant protection and plant products are currently looking at the impacts on their own cost input factors.

What we see is also that we have products that actually makes the farmers able to use less fertilizer. So I think we will see mixed impacts. Currently, the net impact is difficult to estimate exactly. But there will also be opportunities coming out of this, especially as most mentioned in the longer term. But currently, we see a temporary situation where there's a wait and see and where they are deciding how to approach the situation.

The next one is from Kristoffer Haugland at Arctic, also related to agri. Petchem-based products have surged in price, so has fertilizers. This should favor both pricing and volumes of Borregaard's agri-based portfolio. When can we expect to see effect of this?

Again, the timing is difficult to be exact about. I think short term, we see exactly the impact we're seeing now that sales is somewhat reduced due to the uncertainty and that they're using this then situation also as an opportunity to reduce their inventories. We know they are using what they have in inventories. That's the consequence.

But I think, again, longer term, this may offer opportunities both for additional business and also to do price adjustments upwards, definitely, where we are replacing synthetic products. And as I mentioned, I think in the longer term, this is positive for bio-based solutions.

The next one is from Niclas Gehin at DNB. Could you say something about how the different activity level and sales volume were in March after the war, [ bondings ] relative to January and February? And how is the start of Q2?

I would say that we can say we were a bit surprised about March. March was definitely a slower month than we expected. That was when we read it.

For BioSolutions, I think we had to say.

Yes. For BioSolutions in Specialties, that was when we saw the impact starting and which is normally a very strong month for applications like agri. So yes. Yes, he also asked for the beginning of the quarter, but that's again -- we'll get back to that

Next time.

Yes. But we have said a less favorable product mix so that there is some impact also into the quarter in general. Yes.

Thank you. There are no more questions on the web. Let's see if we have something from the audience.

No. I think that was good and a good number of questions. Yes. Thank you very much.

Thank you.

Good afternoon, and welcome to Borregaard's pre-close call. My name is Pal Espen Ramberg, Director of 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, the outlook for the latest quarterly report; secondly, currency and commodity inputs based on public data; and 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 Q4 report.

Thank you, Pal Espen, and good afternoon, everyone.

I will start with reiterating the key points from the outlook for both the full year and the first quarter of 2026. And when relevant, prefer to comment on the outlook given in the Q&A sessions at the webcast for the fourth quarter on the 4th of February this year.

I will start with the BioSolutions, where we expect the sales volume to be approximately 340,000 tonnes for the full year with continued growth in the agriculture segment. The first quarter sales volume is expected to be around 80,000 tonnes, more or less in line with 81,000 tonnes we had in the first quarter of 2025.

We got one question regarding BioSolutions at the webcast, which was related to our reference to strong agriculture markets and improvements in biovanillin. Except from the first quarter, EBITDA in 2025 was not much stronger than 2024 for BioSolutions. And the question was, what can you say about the developments in other markets than agriculture and biovanillin? In our answer, we reminded the audience that we have seen increased costs throughout the year affecting EBITDA. We have cost increases at our U.S. plants and also other costs exceeded the general inflation. On the market side, agriculture is clearly one of the main driving segments for the growth, but we have seen weaknesses in certain markets within construction and also oilfield chemicals have been weaker throughout 2025.

Then turning to the outlook for BioMaterials, where the sales volume in 2026 is forecast to be in the range of 155,000 to 160,000 tonnes, significantly above the 146,000 tonnes in 2025. 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 3% to 4% lower in the first half of 2026 compared with the second half of 2025, and this is partly due to the mix of customers and products.

The European cellulose ether producers are expected to continue facing competition from Chinese cellulose ether producers within the construction segments. These customers normally buy speciality cellulose from Borregaard and other wood pulp speciality producers. The first quarter sales volume in BioMaterials is expected to be in the range of 37,000 to 39,000 tonnes, in line with the first quarter of 2025.

At the webcast in February, there were 2 questions regarding BioMaterials outlook for volume and prices. The first one was about the speciality cellulose competition from China. Has the competition from China on speciality cellulose intensified in recent months? Or is it on par with 2025? Our response was that there has always been some imports from China, either with cotton linters as a raw material for cellulose ethers or cellulose ethers in the low-end segments, typically to construction. Chinese cellulose ethers are of GMO origin and cannot be used for other applications than construction. That means that they can't really go into food and pharma.

Over the past 5 years, we have seen exports gradually increasing from China. During the last year and with the tariffs in the U.S. and also with low construction activity in China, we see what we see in many other industries that the overcapacity in China is being exported. When it can't be exported to the U.S. without tariffs, even more is coming into Europe. So we clearly see an increasing trend of imports of the cellulose ether products from China into Europe. Also remember that Borregaard's strategy has been to move more of our cellulose production going into ethers to food and pharma applications. And we have succeeded quite well with that over the last years. That's been our strategy, and we've seen this coming, and we changed our strategy.

The second question was related to the price reduction in speciality cellulose and mix effects. With regards to BioMaterials and the 3% to 4% price decline in the first half compared with the second half last year, we were asked to shed some more light on the mix effect. And if the decline only partly is due to mix, what are the other reasons for the drop? As we said in the outlook, the reduction in the average price is partly explained by mix, which means mix of products and customers. We sold about 146,000 tonnes in 2025. We expect to sell 10,000 to 15,000 tonnes more in 2026, which means an additional volume with a mix with different pricing. Also, within the construction segment to cellulose ethers, we have done some selective price adjustments. Then we have the 4,000 to 5,000 tonnes we need to sell to the market during the year from the production disruption we had in the third quarter last year. Together, these elements explained why the average sales price will be negatively impacted in the range of 3% to 4%.

Borregaard's main competitor in speciality cellulose, RYAM, presented their outlook before 2026 in the beginning of March. They claim that 85% of their speciality cellulose business was arranged at an average price increase of 18% over 2025 with expected volume loss of about 20% compared with 2025. The other 15% is still in discussion according to RYAM and may not be decided until the back half of this year. If successful in those discussions, the remaining 15% will only come at an average price increase, significantly higher than the 18% level, again, according to RYAM.

On a question on ether grade cellulose, RYAM admitted that the market is challenged and particularly in Europe, confirming what Borregaard said. And this is also according to RYAM due to the ethers coming out of China. However, RYAM claimed that they have achieved near to 20% price increase across ether grades in Europe. Obviously, RYAM is prioritizing value over volume in 2026. If they are successful with the antidumping case against Bracell and Borregaard and the countervailing case against Bracell, they will dominate the U.S. speciality cellulose market. However, for the markets outside the U.S., the risk for RYAM is that they will lose significant volumes if they achieve their price ambitions.

The final outcome of the U.S. antidumping case may also affect several speciality cellulose markets. According to RYAM, a preliminary decision on the countervailing duty case against Bracell is expected this month. If this case end up in favor of RYAM, Bracell might be excluded from the U.S. market where they are the largest supplier.

At Borregaard's fourth quarter webcast, we got the questions, if you could give a ballpark figure on how much we have spent on U.S. legal costs in the fourth quarter? And how much we expected the total sum to be. We answered that we had passed NOK 10 million in cost for these investigations, most of it in the fourth quarter. In the process, we have answered a lot of questionnaires. So hopefully, that part of the process is coming to an end soon. It's difficult to estimate how much more we will spend, but we think the total costs for the antidumping case on Borregaard's hand will be somewhere between 10 -- between NOK 15 billion and NOK 20 million.

Then moving on to the outlook for Fine Chemicals, where sales prices for bioethanol are expected to be largely in line with the levels we saw in 2025. The sales volume for Fine Chemical intermediates is expected to increase compared with 2025. Then to the outlook and the development in other important cost components where the wood cost in the first half of '26 is expected to be around 15% lower than in the first half of 2025.

As to the energy costs, remember that energy consumption is normally higher during the winter and lower in the summer season. About 15% of Borregaard's energy consumption is dependent on energy spot prices for electricity and LNG. For LNG, we have a 1-month delay compared with the market price, which is the Dutch TTF. Electricity prices in Norway so far in the first quarter have on average been significantly above last year's prices. Part of the explanation for the higher electricity price is a colder winter in Norway this year compared with last year, which may also impact energy consumption. On the other hand, LNG prices have been quite a bit lower than last year so far, taking the 1-month delay into consideration. In total, spot prices on energy will not have much of an impact on Borregaard's energy costs in the first quarter compared with the first quarter last year. But higher energy consumption due to the colder weather will have a negative impact on costs, however, not very substantial.

At the end of the outlook presentation, we remind you about the uncertainty in the global economy, particularly related to tariffs, war and conflicts, which may impact Borregaard's markets and costs. The ongoing war in the Middle East has already started to impact shipments and cost of deliveries of goods. Higher LNG and oil prices are starting to impact the prices on energy and also on chemicals. So far, the total impact for Borregaard is limited, partly due to the 1-month delay in LNG prices. However, if the war continues for a longer period with limited supply of oil and gas, it will hurt the global economy.

Having completed the outlook and questions from the fourth quarter presentation, we will point to one more element, which will have an impact on 2026 results. Borregaard has a currency hedging strategy that delays the impact of changes in currency rates. Using currency rates as of the 3rd of February, which were when we -- or the day before we presented the fourth quarter result, the net currency impact for the full year of 2026 was estimated to be positive by approximately NOK 55 million compared with 2025. The corresponding impact for the first quarter of 2026 was estimated to be negative by about NOK 5 million compared with the first quarter of 2025.

So far in the first quarter, the Norwegian kroner has strengthened by 3% to 4% compared with the fourth quarter of 2025 using Borregaard's currency basket. Compared with the first quarter last year, the Norwegian kroner has strengthened 7% to 8%, mainly due to a weaker U.S. dollar. If the present currency rates continue the rest of the month, the net currency impact in the first quarter compared with the first quarter last year will more or less be in line with minus NOK 5 million we estimated at the Q4 webcast on the 3rd of February.

With today's rates for the rest of the year, the net currency impact for 2026 is also expected to be slightly lower than the NOK 55 million, about NOK 15 million, maybe even NOK 20 million lower with what we estimated in early February compared to that.

I will now hand over to Pal 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 the Q&A session. Please submit your questions via the chat function.

We already had someone here. The first one from Elliott Jones in Danske Bank. Given the Middle East escalation, how will this affect the import of potential from Chinese producers and the cost of the rival petrochemical products?

For us, I think it's too early to give any quantification of that. The challenges in transportation is mainly centralized around the Middle East and the Hormuz Strait and transportation between Europe and Asia is going more or less normally. But of course, the cost of transportation is -- has started to increase and will further increase. Then the big question is really how much oil will be supplied to the market. And that remains to be seen. So I don't think we are there yet that we can quantify this a lot. But the main worry is really about the world economy running into a recession. We think the Chinese product will not be much impacted at least in the short run because what we are competing with is not oil-based products, it's based on cotton linter cellulose on the cellulose side.

The next one is from Magnus Rasmussen in SEB. Can you benefit from RYAM's volume loss in '26? Or are you sold out?

I don't think we have a lot of flexibility in our volume because we were quite early out securing volume and customers has been quite willing to commit to volumes. You can see that on our outlook for the volume, which was much, much higher than last year. So I don't think we have a lot of flexibility there, but some we will try to benefit from that. But again, we have to see also how this works out for RYAM outside the U.S. I think they will struggle if they really achieve the prices they say they have achieved outside the U.S., they will struggle on the volume side. But of course, the customers don't have that many alternatives in the short run.

Thank you, Per Bjarne. How does the conflict now in the Middle East affect you? Any extra cost to gas or sulfur already in Q1? And what about Q2? This was from Magnus Rasmussen again.

No, I mentioned what we see so far in Q1. And there, it's mainly related for shipments in March where we see some increases in. Also, some increases there will be. Again, it's difficult still to quantify it. If the war goes on, I think we will see an increase in the Q2, too. We see LNG prices varying a lot. Today, they were about EUR 70 per megawatt hour. They have been most of the time after the war started below EUR 50, but you have these preparations and of course, oil prices fluctuating, but it's more a question of lack of supply of natural gas and oil. So how that will play out, it's difficult to tell. But of course, Borregaard on the energy side, at least is -- has quite a high share of electricity secured.

Thank you. Another one from Elliott Jones regarding BioMaterials prices. You note BioMaterials prices down 3% to 4% in first half versus second half last year. As you see it now, do you expect any changes to this level for the second half?

This year, a rather large share of our volume is on annual contracts. We have a certain percentage that that's up for negotiations in the middle of the year. Again, it's a bit early to see whether we can achieve any price increases, but we don't have a lot of flexibility there, at least from where we see it now.

Another one from Magnus Rasmussen. Are you looking into potential surcharges if costs increase as it did in 2022?

Of course, that is always an option. We haven't started to discuss that yet because we need to see more of how long this war will last and how severe the impact on oil and gas prices and supply will be. But of course, that's something Borregaard don't like to do. We don't want to like to mix that into the negotiations with customers. But if we see high or large cost increases, that will be something that we will have to look at.

And another one from Elliott Jones, more into Middle East. Can you please provide some color as to the potential effect to both pricing and demand for your products as a result of the Middle East escalation?

Again, it's more a question on the world economy and how that will be impacted because many of our products, we have follow more or less GDP growth. And if that comes down, we will see an effect on our products also. But historically, Borregaard has been quite resilient if we go into a kind of recession because we have so many products, we are into so many applications. A higher oil price might have an impact on pricing for some of our specialties because we are competing with fossil-based products. But the fossil-based products like our products are quite advanced. So the oil price is not a big factor on the cost side for competing products either. But there will be some impact if this is going to last for a longer period.

Thank you. We are experience a delay and we will continue shortly. 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. The annual report will be released the 26th of March, together with the notice of the Annual General Meeting, which will be held the 10th of April. We look forward to the next update. Thank you, and goodbye.

Thank you.

Good morning, everyone, and welcome to the fourth quarter 2025 presentation for Borregaard. My name is Tom Erik Foss-Jacobsen. I'm the CEO of the company. And I'll be joined today by our CFO, Per Bjarne Lyngstad. Together we will take you through this agenda.

I will start with the key highlights for the quarter and give an update on the market situation across our business segments. I'll then summarize the outlook for 2026 and finally present our dividend proposal for 2025 before handing over to Per Bjarne, and he will then take you through the financial performance in more detail.

And before we begin, I'd also like to remind those of you that watch the webcast live that you are welcome to submit questions any time during the presentation, and we will address them at the end. Let's begin with the highlights for the quarter. EBITDA came in at NOK 405 million, slightly up from NOK 398 million in the same quarter 2024.

BioSolutions delivered a solid quarter, supported by high biovanillin deliveries and continued growth in sales to agriculture, a trend we have now seen for the 2 last years. BioMaterials delivered good results, driven by higher specialty cellulose prices and increased sales volume. In Fine Chemicals, our Fine Chemical Intermediates delivered a strong performance. Bioethanol sales prices remained at the lower levels that we've been seeing throughout the year.

Wood and energy costs were down in the quarter and partly offset the increases we saw in other costs. We also recorded impairments of, in total, NOK 245 million of the bio-based start-ups we are invested in. This is due to delays and increased capital needs. In the coming period, we will focus on our current positions in bio-based start-ups. We had a strong cash flow in the fourth quarter.

Looking at the full year, we delivered another all-time high EBITDA, reaching NOK 1,878 million, just etching past last year's record of NOK 1,874 million. In BioSolutions, sales to agriculture were strong throughout the year, and we also saw higher sales of biovanillin products. In BioMaterials, sales prices increased and the product mix improved, supported by higher sales of high-purity cellulose.

Fine Chemical Intermediates also delivered a strong result. And again, sales prices for advanced bioethanol declined significantly during the year, mainly due to a significant increase in market supply driven by favorable incentive schemes in Europe. Wood costs increased during the year and the increase in other costs exceeded general inflation. Net currency effects were positive. The cash flow was strong in 2025.

Overall, we are pleased to present another all-time high EBITDA, driven by a strong momentum across our business segments. And this is despite the sharp decline we have seen in the advanced bioethanol sales prices and higher costs.

Now let's turn to the fourth quarter in BioSolutions. This was a solid quarter with the average price in sales currency 6% above Q4 2024, driven by an improved product mix. We saw high deliveries of biovanillin and continued growth in sales to agriculture. The anti-dumping duties on vanillin from China continued to have a positive, though limited impact on our vanillin business.

The average gross sales prices in NOK are impacted by a weaker U.S. dollar compared to Q4 2024. Sales volume was 3% lower than the same quarter last year, which was at the high end of our Q4 guidance and on level with what we see as a more normal fourth quarter volume.

For the full year, BioSolutions delivered solid performance. Average price in sales currency increased 2% and sales volume increased 1% compared to 2024. Strong sales to agriculture continued across both specialty and industrial applications. We saw rising demand for multi-active ingredient solutions in crop protection and the reauthorization of Borregaard's lignin for use in EU, animal feed, helped us gain additional business.

We also recorded higher demand for biovanillin and a positive but overall limited impact from the anti-dumping duties on the vanillin from China in both the U.S. and EU. The average gross sales prices in Norwegian kroner are impacted again by a weaker U.S. dollar compared to the previous year.

Moving on to BioMaterials and the fourth quarter. This was a strong quarter with the average price in sales currency up 6%, primarily driven by price increases. The average gross sales prices in Norwegian kroner were impacted by a weaker dollar compared to Q4 previous year. Sales volume increased 5% compared to the same quarter 2024.

As we informed last quarter, specialty cellulose exports from Norway and Brazil are subject to an ongoing U.S. anti-dumping investigation. A preliminary decision is delayed and now expected at the end of May 2026, with a final decision towards the end of 2026. And here, any duties may apply retroactively for up to 90 days.

Looking at the full year for BioMaterials, the segment delivered a solid result with average sales prices up to -- up 9% and sales volume down 9% compared to 2024. The main drivers here were increased sales prices and an improved product mix, including increased sales of high-purity cellulose to regulated applications, food, pharma, personal care and also to bio-based plastics.

The highly specialized share increased with 4% from 83% to 87%. The average gross sales prices in Norwegian kroner were also here impacted by the weaker U.S. dollar compared to previous year. Sales to the Construction segment declined as the European cellulose ether producers, typically our customers, were negatively impacted by increased imports from Chinese cellulose ether producers, and they are based on cotton linters as their raw material. The disruption we had in specialty cellulose production in Q3 2025 also affected the sales volume in the quarter.

Now moving to Fine Chemicals Q4 and full year. We continue to see a significant decline in sales prices for the advanced bioethanol throughout the year. And this was due to the significant increase in market supply driven by the favorable incentive schemes in Europe. Prices have now returned to levels that we considered normal before these incentives were introduced. For Fine Chemical Intermediates, we saw higher sales prices and a strong product mix, both in the quarter and for the full year.

Then I would like to share our outlook for 2026. In BioSolutions, we expect the sales volume to be approximately 340,000 tonnes with continued growth in the agriculture segment. First quarter sales volumes are expected to be around 80,000 tonnes. In BioMaterials, the full year sales volume is forecast to be in the range of 155,000 to 160,000 tonnes. Sales volume of highly specialized grades is expected to be slightly above the 2025 level.

The average sales prices in sales currency is expected to be 3% to 4% lower in the first half of 2026 compared to the second half of 2025, and this is partly due to mix on customers and products. The European cellulose ether producers are expected to continue facing competition from the Chinese cellulose ether producers within the Construction segment.

First quarter sales volume in BioMaterials is expected to be in the range of 37,000 to 39,000 tonnes. In Fine Chemicals, sales prices for bioethanol are expected to be largely in line with the levels we have seen in 2025. Sales volume for Fine Chemical intermediates is expected to increase compared to 2025.

On the cost side, the wood costs in the first half of 2026 are expected to be around 15% lower than in the first half of 2025. We continue to monitor global uncertainty related to tariffs, war and geopolitical tensions, which may affect our markets and costs. The final outcome of the U.S. anti-dumping case may also affect several specialty cellulose markets.

Before I conclude, I would like to present the dividend proposal for 2025. The Board of Directors has decided to adjust the dividend policy to a target range of 40% to 60% of the net profit compared to the previous range of 30% to 50%. We will continue to pay regular and progressive dividends, reflecting expected long-term earnings and cash flows.

For 2025, the Board proposes a dividend of NOK 4.75 per share, an increase of NOK 0.5 or plus 12% compared to last year. This represents 55% of our net earnings before impairments, corresponding to a dividend yield of 2.4% based on the year-end share price. The total payment amounts to NOK 474 million.

With that, I will hand over to our CFO, Per Bjarne Lyngstad, who will take you through the financial performance and key figures for the quarter and for the full year. Thank you.

Thank you, Tom Erik, and good morning, everyone. Borregaard's operating revenues in the fourth quarter were 5% higher compared with the fourth quarter of 2024, mainly as a result of higher sales prices and sales volume in BioMaterials. EBITDA increased to NOK 405 million, NOK 7 million above the fourth quarter of 2024. BioMaterials had an improved result, while BioSolutions and Fine Chemicals had a lower result.

Net currency effects were slightly positive by NOK 5 million compared with the fourth quarter of 2024. An 8% weaker U.S. dollar compared to the Norwegian kroner was offset by reduced hedging losses. The EBITDA margin ended at 22.1% in the fourth quarter, 0.7 percentage points below the corresponding quarter in 2024.

In the quarter, as Tom Erik has mentioned, Borregaard has recorded NOK 245 million of impairments on investments in bio-based start-ups. Excluding the impairment, earnings per share ended at NOK 1.64 compared with NOK 1.30 in the fourth quarter of 2024.

As I said, Borregaard has made impairments totaling NOK 245 million on its investments in bio-based start-ups. The impairments reflect recent development in these companies and is recorded under financial items in our profit and loss statement. The major part, NOK 225 million is an impairment of the investment in Alginor, where recent information indicated project delays and additional capital needs. The impairment is based on an impairment test in accordance with IFRS.

After the impairment, the remaining book value of Alginor is NOK 250 million, about NOK 10 per share. In addition, a total impairment of NOK 20 million has been made on the investments in Kaffe Bueno and Lignovations. The Danish bioscience company, Kaffe Bueno faces delays in its project, and Borregaard has decided not to exercise its warrants to subscribe for additional shares, but we will participate in a minor convertible loan to the company.

The Austrian technology start-up, Lignovations has also had delays and consequently faced lack of funding. On the 27th of January 2026, Borregaard received a notice of decision from the Financial Supervisory Authority of Norway following their regulatory financial reporting review of Borregaard's financial statements for 2024.

Borregaard has been required to perform a new calculation of the value of Alginor at the end of 2024. If a correction is deemed necessary, figures for 2024 will be restated in Borregaard's annual report for 2025. Borregaard is currently in the process of preparing documentation for the valuation at year-end 2024 as requested by the Financial Supervisory Authority.

Then turning to the full year for Borregaard. Operating revenues increased by 1% to NOK 7.7 billion. EBITDA had a marginal NOK 4 million improvement and ended at NOK 1.878 billion. Both BioSolutions and BioMaterials had an improved result, whereas Fine Chemicals had lower results compared with 2024. Strong sales to agriculture and higher sales of biovanillin in BioSolutions, increased sales prices and improved product mix for BioMaterials and positive net currency effects contributed strongly to the all-time high EBITDA in 2025.

The result was negatively impacted by a significant reduction in bioethanol sales prices and cost increases exceeding the general inflation. The additional cost increases were mainly related to increased manning in Norway, mainly and also in the U.S. in addition to higher costs for certain chemicals and insurance and reduced government grants, among other things. EBITDA margin ended at 24.3%, close to the margin in 2024. Return on capital employed ended at 15.7%, below the 2024 level, but above our targeted level of minimum 15% pretax.

Excluding the impairment, earnings per share were NOK 8.67 compared with NOK 8.24 in 2024. Operating revenues in BioSolutions were in line with the fourth quarter of 2024 and 4% above for the full year. EBITDA was NOK 245 million in the fourth quarter compared with NOK 251 million in the fourth quarter of 2024.

High deliveries of biovanillin and sustained growth in sales to agriculture were more than offset by increased costs at the U.S. manufacturing sites in addition to general cost inflation. The net currency effect were insignificant in the quarter.

For the full year, EBITDA reached an all-time high of NOK 1.209 billion, NOK 105 million higher than in 2024. Strong sales to agriculture also for the full year were the main driver of the improved result. This was partly offset by increased costs, the same explanations as for the quarter with the U.S. manufacturing sites and the general cost inflation. The net currency impact was positive compared with 2024. The fourth quarter EBITDA margin was 24.3%, 0.7 percentage points below the margin in the fourth quarter of 2024. For the full year, the EBITDA margin was strong and improved to 27.5%, 1.5 percentage points higher than in 2024.

In BioMaterials, operating revenues in the fourth quarter were 11% above the fourth quarter of 2024 as a result of higher sales prices and sales volume. For the full year, higher sales prices were the main contributor to a 3% increase in operating revenues. EBITDA reached NOK 127 million in the fourth quarter, NOK 25 million above the same quarter in 2024. The improved result was due to higher sales prices and increased sales volume, together with the lower wood and energy costs in the quarter. This was partly offset by an increase in other costs, including certain chemicals, costs of the anti-dumping case in the U.S. and the general inflation. Net currency effects were positive in the quarter.

For the full year, EBITDA ended at NOK 495 million, an improvement of NOK 61 million compared with 2024. For the full year, higher sales prices and improved product mix were the main reasons for the improved result, partly offset by lower sales volume and higher wood costs and the net currency effects were positive for the full year. The EBITDA margin ended at 18.7% in the fourth quarter, 2 percentage points above the same quarter in 2024. For the full year, the EBITDA margin was 18.4%, close to 2 percentage points also there above 2024.

Improved product mix and sales prices for Fine Chemical Intermediates, partly offset by lower bioethanol sales prices were the main reasons for a 13% increase in operating revenues for Fine Chemicals in the fourth quarter. For the full year, operating revenues decreased by 16% due to lower sales prices for Borregaard's advanced bioethanol. EBITDA was NOK 33 million in the fourth quarter compared with NOK 45 million in the fourth quarter of 2024.

Lower sales prices for bioethanol were partly offset by a strong result for Fine Chemical Intermediates. Fine Chemical Intermediates had a favorable product mix and increased sales prices in the quarter. Net currency effects were insignificant for Fine Chemicals in the quarter. For the full year, EBITDA ended at NOK 174 million, NOK 162 million lower than in the fourth quarter of 2024. The reduced result for the full year was due to lower sales prices for our advanced bioethanol.

Fine Chemical Intermediates improved compared with 2024 due to improved product mix and increased sales prices. The net currency impact was positive for Fine Chemicals for the full year. The EBITDA margin was 21% in the fourth quarter, about 11 percentage points below the same quarter of 2024. The EBITDA margin for the full year was 26% compared with 42% in 2024.

The net currency impact on EBITDA was positive by NOK 5 million compared with the corresponding quarter in 2024. Driven by a weaker dollar, the Norwegian kroner strengthened by 6% -- about 6% in the quarter using Borregaard's currency basket. Hedging losses were NOK 24 million in the fourth quarter compared with a loss of NOK 93 million in the fourth quarter of 2024. For the full year, the net currency impact on EBITDA was positive by about NOK 115 million. Hedging losses amounted to NOK 174 million compared with a loss of NOK 365 million in 2024.

Using currency rates as of yesterday, the net currency impact for the full year 2026 is estimated to be positive by about NOK 55 million compared with 2025. The corresponding impact for the first quarter this year is estimated to be negative by about NOK 5 million compared with the first quarter of 2025.

Borregaard had a strong cash flow from operating activities of NOK 419 million in the fourth quarter with a positive impact from a reduced net working capital. Also for the full year, the cash flow from operating activities was strong and close to NOK 1.4 billion an improvement of close to NOK 300 million compared with 2024. A more favorable development in net working capital was the main reason for the strong cash flow from operating activities.

Investments were NOK 383 million in the fourth quarter. The largest expenditures in 2025 were related to environmental investments and debottlenecking at the Sarpsborg site, specialization projects within BioSolutions and participation in capital raises in Alginor. Net interest-bearing debt increased by NOK 18 million in the fourth quarter. For the full year, net interest-bearing debt was reduced by NOK 150 million to NOK 2.90 billion. At the end of 2025, Borregaard is well capitalized with an equity ratio of 61% and a leverage ratio of 1.11 compared with 1.2 at the end of 2024.

Finally, I'll go through an updated investment forecast for 2026 and 2027. Borregaard has a financial objective to keep replacement investment at depreciation level, excluding depreciation from leasing. In 2025 to 2027, targeted CO2 and COD reductions and general cost increases explain replacement investments above target level. These environmental investments will also support specialization and value growth investments.

The largest project is the debottlenecking at the Sarpsborg site, where we now expect a production output to increase gradually from the second quarter of 2027 instead of the second half of 2026. The delay is due to unforeseen challenges with buildings layout. However, the cost estimate for the project is unchanged at about NOK 800 million.

The delay in the debottlenecking project is the main reason for lower-than-expected investments in 2025 and a slight increase in the forecast for 2027. Additional investments in bio-based start-ups are not included in this forecast. There are, of course, uncertainties in these estimates related to final decision, execution time, payment schedules, among others.

And that concludes today's presentation. Tom Erik and I will now be ready to answer any questions, both from the audience present here in Oslo and from those who follow the webcast. Our Vice President, Finance, Veronica Skevik will moderate the webcast questions.

We have received some questions. The first one is related to U.S. legal costs. It comes from Mr. Niclas Gehin at DNB Carnegie. Could you give us a ballpark figure on how much you have spent on U.S. legal costs in Q4? And how much is the total sum that you expect to use?

We have now passed in total NOK 10 million in costs for these investigations, most of it in the fourth quarter. We have answered a lot of questionnaires. So hopefully, that process is coming towards the end. It's still difficult to estimate how much more, but it will be somewhere, I think, between NOK 15 million and NOK 20 million as the end cost here as our best estimate as of today.

Next question is regarding the specialty cellulose competition from China. It comes from Mr. Magnus Rasmussen from SEB. Has the competition from China or on specialty cellulose intensified in recent months? Or is it on par with 2025?

I would say that there has always been some imports from China, either cotton linters as a raw material, cotton linters pulp to blend in, but also exports of cellulose ethers in the low-end segments, typically construction because it's non-GMO origin and cannot be used for other applications.

But I think we have gradually seen over the past 5 years that exports has been gradually increasing. But now over the last year, also with tariffs in U.S. and also with low construction activity in China, we see -- what we see in many other industries that the overcapacity in China is being exported. And now it can't be exported to U.S. without tariffs, even more is coming into Europe. So I think we definitely are seeing an increasing trend of imports of the cellulose ether products from China into Europe.

But also remember that Borregaard's strategy has been to move more of our cellulose production going into ethers to food and pharma applications, and we have succeeded quite well with that over the last years also. So that's been our strategy. We've seen this coming, and we've changed our strategy.

Yes. And it proves why this strategy is very sensible. Yes.

Thank you. Next question is related to developments in markets within BioSolutions. And it also comes from Mr. Magnus Rasmussen from SEB. You continue to refer to strong agriculture markets in BioSolutions and improvements in biovanillin, yet, except from Q1 EBITDA in 2025 has not been much stronger than 2024. What can you say about the developments in other markets than agriculture and biovanillin?

Yes. I think, first, we have to bear in mind what has been said here on the cost side for Borregaard and for BioSolutions. We have seen increased -- significantly increased costs throughout the year. And specifically BioSolutions was mentioned both the wood cost, but also that we have cost in the U.S. and that they exceeded the general inflation, the other costs.

But on the market side, agriculture is clearly one of the main driving segments for the growth. We have said before, this is roughly 1,000 customers, 200 products. So there's definitely a mix also within that portfolio. We have also seen weaknesses in certain markets. I would say, construction market should be no surprise that there are weaknesses in certain markets within construction and also oil throughout the year 2025 has been weaker.

Thank you. Next question is related to the price reduction in specialty cellulose and the mix effects. It comes from Mr. Elliott Jones at Danske Bank. With regards to BioMaterials, 3% to 4% price declines in the first half versus second half last year. Can you shed some more light on the mix effect? And if you only partly due to mix, what are the other reasons for the drop?

Yes. First of all, it's important to notice that we are referring to that is partly explained by mix, which means mix of products and customers. And we sold about -- was it, 146,000 tonnes in 2025. We have in our outlook that we will sell 10,000 to 15,000 tonnes more. So that means also an additional volume with a mix with different pricing.

And also the -- within the Construction segment to sell ethers, we have done some selective price adjustments. And we also have the 4,000 to 5,000 tonnes we need to sell to the market during the year from the production disruption we had in the last quarter. And I think these things together explains why the average sales price will be impacted in the range of 3% to 4%.

Thank you. Next question, and so far, the last I have here, also comes from Mr. Elliot Jones from Danske Bank related to costs. With regards to costs, excluding wood and energy that have exceeded inflation this year, 2025, can you provide some more rationale as to why this is? And how do you expect this to develop in 2026?

Yes. I mentioned a few key factors there. Manning is one, we have increased our manning mainly in Norway, but also in the U.S. entities. So that gives an increase above inflation. We have had quite an increase in insurance premiums. That's also due to that we have chosen to improve our coverage on some of the insurance. And then we have given -- or we have gotten less grants from -- to our innovation activities in 2025, which normally is booked as a reduction in fixed costs.

So these are some of the explanation. It's a lot of different things on the cost side, but we've seen. Also we have, in addition to manning at the U.S. manufacturing sites, the upgrade of the facility in Wisconsin and also an upgrade of the competence in the organization has led to additional costs there.

Thank you. There are no more questions on the web. So I'm not sure if there are any questions from the audience.

That's concludes our presentation. Thank you very much.

Thank you.

Good [ morning ] everyone. Thank you for joining Borregaard's pre-close call. My name is Veronica Skevik Frey and I am Vice President Finance in Borregaard. I'm joined today by our CFO, Per Bjarne Lyngstad, and we are live from the biorefinery in Norway. And here is the agenda for today's call. First, we'll look at the outlook from the latest quarterly report from the Q3 report reiterated for that. Secondly, currency and commodities inputs and then last, we'll have a Q&A session. And regarding the Q&A session, feel free to start typing your questions in the chat functions. And now I will hand over to Per Bjarne, who will then reiterate the key points from the outlook given in our third quarterly report.

Thank you, Veronica, and good afternoon, everyone. I will start with reiterating the key points from the outlook for Q4 and when relevant refer to comments given in the Q&A session at the webcast for the third quarter on the 22nd of October this year. I will start with BioSolutions. In Biosolutions, we expect the sales volume in the fourth quarter to be between 70,000 and 75,000 tonnes which is below the 77,000 tonnes we had in the fourth quarter last year.

We continue to expect a positive but limited effect from the antidumping duties on vending. We've got 3 questions regarding BioSolutions at the webcast after the third quarter. The first core question was related to margin development and the decline year-on-year despite the foreign exchange tailwind. What should we expect going forward? Our response was that Borregaard offer a very broad portfolio, especially in agriculture, we have around 200 different products sold to 1,000 different customers. Within this broad portfolio, there will be big mix differences from quarter-to-quarter explaining variations in margins. In general, we think we have quite high margins in BioSolutions and they have been at well above 25% over quite a long period, then I'm talking about EBITDA margin. This year, we are hurt a little bit by a weaker dollar. However, margins in the first 9 months of 2025 have been more than 2 percentage points above the same period last year.

The second question was related to average sales price development in BioSolutions. With increasing agri sales, why is the average sales price in sales currency of that year-on-year, and the product mix stated to be in line with last year? Would higher agchem sales imply a more favorable product mix? Again, our response was to repeat that we think that, that's related to mix within agri, where we have a very broad portfolio with products going into both industrial applications and specialties. And agchem, which was mentioned in the question, it goes into -- mainly into specialties. So it will depend on which applications during the quarter takes more volume and which takes less. The last question was, what do we expect in terms of mix in Biosolutions on the agri side in the fourth quarter?

In general, we are positive to the development we're seeing in agri. Q3 was the seventh consecutive quarter that we reported growth in agri and we are very positive about the long-term picture for agri, and that our portfolio fits very well with the needs of the market. Then turning to the outlook for Biomaterials, where the sales volume in the fourth quarter was expected to be in the range of 35,000 to 38,000 tonnes with a higher share of highly specialized grades compared with the fourth quarter last year. The average sales price in the fourth quarter should remain largely in line with the third quarter. At the webcast in October, there were no questions related to biomaterials outlook for volume and prices. As to the wood costs, which mainly affects Speciality Cellulose, we expect it to be slightly lower in the fourth quarter than in the fourth quarter last year.

We got several questions regarding the wood costs. The first one was if we had a change in wood cost guidance compared with what we said after the second quarter. And our answer was not really. As to the price reduction on wood, that's the same as after the second quarter. But we had a negative mix effect between chips and roundwood in the third quarter, and we had a higher-than-normal inventory of wood and at all higher prices at the beginning of the third quarter. The fourth quarter should be better than the third quarter and also better than the fourth quarter last year. And on a follow-up question, we estimated additional wood costs in the third quarter compared to the third quarter last year to be in the range of NOK 10 million to NOK 15 million.

In the fourth quarter, our estimate was that the wood cost would be closer to NOK 10 million lower compared with the third quarter, and also compared with the fourth quarter last year. The last question was if the wood cost will continue to be a cost tailwind in 2026. Our comment was that the negotiations for 2026 was about to start and would go on until the end of the year. However, what we've seen in Sweden and also in Norway has been sawmills closing down for at least a period, putting pressure on wood prices for 2026. Also related to Speciality Cellulose, we got the question about the antidumping allegations in the U.S. And if we could provide some color on as to potential costs we expect to realize in connection with this case. We commented that U.S. lawyers and experts are quite expensive, and that we, for sure, will have a cost impact going forward in this case. It will be some millions in costs, probably more than NOK 10 million over the period the case is going on. Then moving on to the outlook for Fine Chemicals, where sales prices for bioethanol continue to be significantly lower than last year. The product mix for Fine Chemical Intermediates in the fourth quarter is expected to be weaker than in the third quarter. Then to the outlook and to the development in other important cost components where we expect energy consumption, spot energy prices and energy-related raw material prices to increase seasonally in the fourth quarter compared to the third quarter.

As to energy cost, remember that energy consumption is normally lower in the summer season and higher during the winter. About 15% of Borregaard's energy consumption is dependent on energy spot prices for electricity and LNG. For LNG, we have a 1-month delay compared with the market price. Electricity prices in Norway so far in the fourth quarter have on average been significantly above last year's prices, but LNG prices have been quite a bit lower than last year, taking the one month delay into consideration. In total, spot prices on energy will not have much of an impact on Borregaard's energy cost in the fourth quarter compared with the fourth quarter last year. We got a question regarding cost development, where we were asked if we could provide further color on cost base developments, and if we expect any changes to these dynamics in the fourth quarter and beyond. This year, we have had quite significant cost inflation in line with what we have seen in Norway as a total and also in many other countries.

In addition, we have had some further increases in costs due to, for instance, that we are upgrading our facility in Wisconsin in the U.S. It's both an upgrade and an expansion. And we have also increased our sales force a little bit. So we have had some additional costs in addition to the general inflation. And we've also seen that the cost of buying equipment to the plant in Norway has increased more than the general inflation, both for equipment for maintenance and for investments. This means that we have had cost increases above inflation so far this year. Whether that will continue is difficult to say. Our aim is to keep our cost increases at or below the general inflation, to have productivity gains also on the fixed cost side. But it's a bit early to see how this will develop going forward. Finally, we've got 2 questions regarding capital expenditure.

The first was regarding our NOK 1 billion CapEx guiding for 2025 where we have spent just NOK 542 million in the first 9 months. And the question was whether we expect NOK 450 million of CapEx in the fourth quarter. And if not, is it actually lower CapEx or just phasing? And our response was that normally, we put a lot of equipment in during the maintenance stop in October. And we have always had a much higher CapEx number in the fourth quarter than in the 3 other quarters of the year. Whether it will reach NOK 400-plus million in the fourth quarter, it's a bit early to tell because we may see that some expenditure may end up in 2026 instead of 2025. However, we think total CapEx will be close to the NOK 1 billion we have in the forecast. In the second question on CapEx, we were asked to confirm that the second phase of Sarpsborg bottlenecking was already included in the CapEx guidance shared at 2024 Capital Markets Day for the year 2026, something we confirmed.

At the end of the outlook presentation, we reminded you that the annual maintenance stop at the Sarpsborg site in October will affect production volumes in the fourth quarter as it did in the fourth quarter last year. And finally, a reminder about the uncertainty in the global economy, particularly related to tariffs, war and conflicts, which may impact Borregaard's markets and costs. Having completed the outlook and the questions from the third quarter presentation, we will point to one more element, which will have an impact on the fourth quarter results. Borregaard has a currency hedging strategy that delays the impact of changes in currency rates. Using rates as of the 21st of October, the net currency impact for the fourth quarter was estimated to be positive by about NOK 5 million compared with the fourth quarter of 2024. So far in the fourth quarter, the Norwegian kroner has been quite stable compared with the third quarter using Borregaard's currency basket.

However, compared with the fourth quarter last year, the Norwegian kroner has strengthened by about 5%, mainly due to a weaker dollar. If the present currency rates continue the rest of the month, we will see an equal or marginally higher net currency impact in the fourth quarter compared with the NOK 5 million based on the calculation from 21st of October. I will now hand over to Veronica, who will lead our Q&A session with questions asked in the chat function of this webcast.

Thank you, Per Bjarne. And we will now open the floor to questions from our listeners. Please use the chat function to submit your questions, and we will address them where possible and as time permits. And during Per Bjarne's reiteration of the outlook, we have received a couple of questions already.

The first one is from Ryan Buckley from Copeland Capital. Can you please outline your views on the advanced bioethanol market for 2026 and what impacts the country level implementations of RED III, the Renewable Energy Directive III will be on demand. Any comments on the regulatory backdrop in Germany or France would also be appreciated.

Well, again, we will come back to the topic during our fourth quarter presentation on the fourth of February. However, I can add that we saw a significant increase of supply of advanced bioethanol in Europe towards the end of 2024, and we don't see any major change in the supply situation as we move into 2026. There are some investigations going on regarding questionable certifications for some suppliers. But the overall picture is that supply has increased permanently as is the intention of incentives within EU and some other European countries.

As to the RED III directive, we don't see that having much of an impact for 2026. As I said, the incentives are there to stimulate increased supply of bioethanol or biofuel. And that's what's happening. The main countries for bioethanol into gasoline is France, Germany, Switzerland, maybe some other countries, but those are the main countries. And we don't expect anything to change really on the regulation side in 2026.

Thank you. There are 2 questions from Elliott Jones from Danske Bank. The first one, can you please provide an update on the antidumping filings and any costs related to this to be seen in the P&L for the fourth quarter and beyond?

I think the main update is that we have provided a lot of information for the Department of Commerce in their investigation of the case. But of course, the department has also been affected by the budget shutdown in the U.S. So the preliminary ruling from them is now more expected to be in the second quarter, maybe May, June, and not in the first quarter as initially said. I think that's the main news on this process. It goes on and the conclusions are a bit postponed.

As to the cost, I said during the Q3 presentation that it will probably be about NOK 10 million, and it will be. It will probably be close to NOK 10 million also already for this year since we have spent a lot of resources now on really the filing and providing the necessary information.

Next one from Elliott Jones. Can you provide some color on the developments seen around wood costs? And have there been any -- and have they come down as you expected?

Again, I think we will have to wait and see what we say during our Q4 presentation in February. We don't want to disclose final numbers today. But there's no doubt that prices has come down. We saw Södra in Sweden announced further price reduction of SEK 45 in December. They had one previous reduction during the second half. So prices are coming down quite significantly, how much, we will come back to.

Thank you. There are currently no other questions but we'll hold on a few seconds to see if there are more coming in due to the delay on the webcast.

Guess that seems to conclude the Q&A session. Thank you for participating in today's pre-close call. We appreciate your interest in Borregaard. Thank you for your interest in Borregaard. This webcast will be published on Borregaard's website until the next pre-close call in March of next year. And as a reminder, this call marks the start of our silent period during which contact with the investment community will be reduced to a minimum. We look forward to our next update and wish you all a great day ahead and happy holidays. Thank you, and goodbye.

Good morning, and welcome to the third quarter 2025 presentation for Borregaard. My name is Tom Erik Foss-Jacobsen. I'm the new CEO since 1st of August, and I'll be joined today by Per Bjarne Lyngstad, our CFO, and we will take you through this agenda. I'll begin with the key highlights from the quarter and provide an update on the market situation across our business segments. I will then share details on our second investment to increase capacity at our site in Sarpsborg, which has recently been approved on the Board level as well as our participation in a convertible loan to Alginor.

Finally, I'll summarize the outlook for the remainder of the year before handing over to Per Bjarne, who will walk you through the financial performance in more detail. Before we continue, I just would like to remind those of you watching the webcast live that you're welcome to submit questions at any time during the presentation, and we'll address them at the end of the presentation.

Let's begin with the highlights for the third quarter. EBITDA came in at NOK 440 million, down from NOK 524 million in the same quarter last year. The overall result was reduced due to lower bioethanol prices and disruption in cellulose production. The disruption had a negative EBITDA impact of approximately NOK 40 million. We saw solid performance in BioSolutions, driven by continued sales growth in agriculture, marking the seventh consecutive quarter of growth in that area. In BioMaterials, we continued to see increased sales prices. Our Fine Chemical Intermediates delivered a strong result. Across all business areas, we had positive net currency effects.

Now let's turn to the market situation, starting with BioSolutions. Sales volume increased 4% compared to the same quarter last year. This growth was again driven by our broad agriculture portfolio with no single product group or single market standing out. We offer a broad portfolio to the agricultural sector. It's comprising approximately 200 different products, and we are serving around 1,000 customers within agriculture. The average price in sales currency and the product mix were in line with the same quarter last year. Q3 typically sees a seasonally weaker product mix, which may slightly dampen the average sales price. The antidumping duties on vanillin from China continued to have a positive, though limited impact on Borregaard's vanillin products. We also saw positive net currency effect across the segment in the quarter.

Then next over to BioMaterials, where performance was weaker in the quarter. The average price in sales currency was 9% higher than in the third quarter 2024, primarily driven by price increases. However, higher sales prices and an improved product mix were more than offset by a significant decline in sales volume compared to the same quarter last year. The lower sales volume was due to the temporary disruption in cellose production and strong deliveries in the corresponding quarter last year. Net currency effects were positive for BioMaterials in the quarter.

Then I would like to address the recent developments regarding allegations of dumping of specialty cellulose products from Norway, specifically Borregaard into the U.S. market. In August, RYAM and the United Steelworkers Union filed petitions in the U.S. requesting antidumping and countervailing duties on specialty cellulose imports. The petition targets products from both Norway, meaning Borregaard as a company and also Brazil, where we have a company named Bracel, which is the target. For Borregaard, this means antidumping duties, while Bracel faces both antidumping and countervailing duties.

Borregaard does not recognize the basis for these claims and have engaged both legal and accounting specialists to defend our position. It's important to note that Borregaard's historical sales of specialty cellulose to the U.S. have been limited. However, there was a moderate increase in sales in 2024, driven by higher demand following the closure of Georgia-Pacific’s Foley plant in Florida.

Regardless of the petition, our exports to the U.S. will decrease in '24 -- excuse me, in '25. As of 1st of August, Specialty Cellulose products from Norway are already subject to a 15% import duty and any additional antidumping duties beyond that are expected to have a limited impact on our export volumes to the U.S. A preliminary decision is expected late in Q1 2025 -- 2026 at the earliest, with a final decision expected likely late in Q3 next year.

Now moving on to Fine Chemicals, where performance was weaker in the quarter. The main driver here was the continued lower sales prices for our advanced bioethanol. In addition, deliveries of bioethanol were lower compared to the high volumes in the same quarter last year. As previously explained, the decline in sales prices for our advanced bioethanol is largely due to a significant increase in market supply, driven by the favorable incentives we have seen in Europe.

In Fine Chemical Intermediates, we saw a strong quarter, supported by a more favorable product mix and higher sales prices compared to the same period last year. The net currency impact in Fine Chemicals was positive. Then I would like to update you on the progress of our capacity expansion at the Sarpsborg site, which is a key part of Borregaard's long-term growth strategy. We have now committed to the second step of our 2-phase expansion plan at Sarpsborg with an investment of NOK 308 million. This follows the first investment of NOK 490 million, which was launched in Q3 last year as part of the investment plan that we announced at our Capital Markets Day.

This -- the main goal for us here is to debottleneck and increase production capacity at the site. When both steps are completed, we expect a total capacity increase of 5% to 10%. The expansion covers our core product areas, lignin-based biopolymers, specialty cellulose and bioethanol. Production output is expected to increase gradually from second half 2026. In addition to higher capacity, these investments will also deliver environmental and cost benefits, including reduced costs and volume of residuals, energy savings and also reduced caustic soda consumption. We also anticipate reduction in COD effluents, supporting our ambitious sustainability targets.

Then I would also like to update you on Borregaard's participation in the recent financing solution for Alginor, which is an important step in supporting their ongoing investments. The financing package is designed to ensure Alginor can complete and commission its commercial-scale demonstration plant for alginates. As part of the financing solution, the convertible loan is being guaranteed by 3 main shareholders: Borregaard, Must Invests and Hatteland Group. Our share of the loan will be between NOK 83 million and NOK 111 million, depending on the level of participation from other shareholders.

Then finally, I will share our outlook for Q4. In BioSolutions, we anticipate Q4 sales volumes to range between 70,000 and 75,000 tonnes, which means below the 77,000 tonnes recorded in the same quarter last year. Antidumping duties on vanillin from China are anticipated to continue having a positive, but limited impact for Borregaard's vanillin products. In BioMaterials, Q4 sales volume is expected to be in the range of 35,000 to 38,000 tonnes. We anticipate a higher share of highly specialized grades compared to Q4 last year, and the average sales price should remain largely in line with Q3 this year.

For Fine Chemicals, sales prices for bioethanol will continue to be significantly lower than last year. The product mix for Fine Chemicals Intermediates in Q4 is expected to be weaker than in Q3. On the cost side, wood costs in Q4 will be slightly lower than in Q4 last year. However, we expect energy consumption, spot energy prices and energy-related raw material prices to increase seasonally in Q4 compared to Q3 this year. The annual maintenance stop at the Sarpsborg site will also affect production volumes in Q4. Finally, we will continue to monitor the uncertainty in the global economy, particularly related to tariffs, war and conflicts, which may impact our markets and costs.

With that, I'll hand it over to our CFO, Per Bjarne Lyngstad, who will take you through our financial performance and key figures for the quarter. Thank you.

Thank you, Tom Erik, and good morning, everyone. Borregaard's operating revenues in the third quarter declined by 8% compared with the third quarter of 2024, mainly due to lower sales volume in BioMaterials and lower sales prices for bioethanol. EBITDA was NOK 440 million, down from NOK 524 million in the third quarter last year. BioSolutions delivered a slightly improved result, while BioMaterials and Fine Chemicals had weaker performance.

Net currency effects were positive by about NOK 30 million compared with the third quarter of 2024. In September, an unexpected outage occurred at a facility at the Sarpsborg site, which supplies a key chemical used in cellulose production. During the outage, we produced cellulose grades outside specifications, leading to delayed deliveries of certain grades. Production of lignin-based biopolymers, biovanillin and bioethanol remained unaffected by the outage.

The EBITDA impact from the production disruption was about NOK 40 million, as previously mentioned by Tom Erik. The EBITDA margin ended at 24.5%, close to the margins we've had in previous quarters this year, but below the margin in the same quarter last year. Earnings per share were NOK 1.96 compared with NOK 2.51 in the third quarter last year. The reduction in earnings per share was mainly due to the decrease in EBITDA adjusted for tax.

In BioSolutions, operating revenues increased by 3%, primarily driven by higher sales volume. EBITDA was NOK 277 million, a slight improvement of NOK 6 million compared with the third quarter last year. Continued growth in sales to agriculture was offset by cost increases exceeding the general inflation. These cost increases were mainly due to higher input and manning costs at our U.S. manufacturing sites.

Antidumping duties on vanillin from China had a positive, but limited impact on vanillin products. The net currency impact was positive for BioSolutions in the quarter. And the EBITDA margin in the third quarter was 26.2%, in line with the same quarter last year. A lower sales volume due to the disruption in cellulose production and high deliveries in the third quarter last year resulted in 15% lower operating revenues in the third quarter for BioMaterials. EBITDA was NOK 112 million, NOK 19 million lower than in the same quarter last year.

On the positive side, we had higher sales prices and improved product mix. However, this was more than offset by the lower sales volume in addition to higher wood costs. The wood costs were impacted by an above-normal inventory level at higher prices at the beginning of the quarter in addition to an unfavorable mix of wood in the quarter. The net currency effects were positive for BioMaterials. The EBITDA margin was 19.2%, in line with the third quarter of last year. Operating revenues in Fine Chemicals declined by more than 30% compared with the third quarter of 2024, primarily due to lower sales prices for bioethanol.

EBITDA ended at NOK 51 million compared with NOK 122 million last year. The reduction in EBITDA was mainly driven by continued lower sales prices for bioethanol. Lower deliveries of bioethanol compared with the high deliveries in the third quarter last year also contributed to the decline. Fine Chemical Intermediates delivered a strong result, supported by a more favorable product mix and price increases compared with the third quarter last year. Net currency effects were positive also for Fine Chemicals. The EBITDA margin was 30.5% in this area, close to 20 percentage points below the same quarter last year.

As mentioned earlier, the net currency impact on EBITDA was positive by about NOK 30 million compared with the third quarter last year. The positive impact was primarily due to reduced currency hedging losses. Hedging losses were NOK 21 million in the third quarter compared with a loss of NOK 86 million in the same quarter last year. The positive impact from lower hedging losses was partly offset by a stronger Norwegian kroner, particularly against the dollar.

Based on Borregaard's currency basket, the NOK was about 4% stronger compared with the same quarter last year. Using currency rates as of yesterday, the estimated net currency effect for the full year of 2025 is now positive by NOK 115 million compared with 2024. The corresponding impact for the fourth quarter is estimated to be positive by about NOK 5 million. Borregaard had a cash flow from operating activities of NOK 423 million in the third quarter. The relatively strong cash flow was driven by the cash effect from EBITDA and a reduction in net working capital.

Investments were NOK 160 million in the quarter. The largest expenditures were related to the Sarpsborg site and ongoing environmental investments, the debottlenecking project and specialization projects in BioSolutions. In addition, Borregaard participated with NOK 23 million in the repair offering in Alginor's capital raise. Net interest-bearing debt decreased by as much as NOK 283 million in the quarter. At the end of the quarter, Borregaard remained well capitalized with an equity ratio of 60% and a leverage ratio, which is net interest-bearing debt over EBITDA of 1.11.

And that concludes today's presentation. Tom Erik and I will now be ready to answer any questions, both from the audience present here in Oslo and from those who follow the webcast. Our Vice President, Finance, Veronica Skevik Frey, will moderate the webcast questions.

Thank you Per Bjarne. We have some questions here. The first one is from Mr. Magnus Rasmussen at SEB regarding CapEx.

You have a NOK 1 billion CapEx guidance for 2025. And have spent just NOK 542 million year-to-date. Should we expect the NOK 450 million of CapEx in Q4? And if not, is it actually lower CapEx or just phasing?

Normally, we put in a lot of equipment during the maintenance stop in October. And we've always had a much higher number in the fourth quarter than in the 3 other quarters in the year. Whether it will reach NOK 400-plus million, it's a bit early to tell because we have, like you say, phasing also here that some costs may go over to 2026. But we think it will be at least close to the NOK 1 billion we have in the forecast.

There's another question also from Magnus Rasmussen regarding BioSolution margins. Despite the foreign exchange tailwind, our BioSolution margins are declining year-on-year. Why? And what should we expect going forward?

As I said, in agriculture, we offer a very broad portfolio. We have around 200 different products sold to 1,000 different customers. And this is also within a broad range of sub applications. So there will be mix differences within agriculture. And I would say that's the main explanation for why you can see differences like that.

But I think we should remind people that we have very high margins in this area, and they have been at well above 25% over quite a long period. And of course, we are hurt a little bit by the dollar also on the top line, which also affects margins a little bit.

Next question is regarding cost base development, and it comes from Mr. Elliott Jones at Danske Bank. Given the margin developments across all quarters, could you please provide further color on cost base developments and if you expect any changes to these dynamics in the fourth quarter and beyond?

What we've seen this year is that we have had quite significant cost inflation like the rest of the country and the world. We have had some further increases in cost due to that we are, for instance, upgrading our facility in Wisconsin in the U.S. It's both an upgrade and an expansion. And we have also increased our sales force a little bit. So we have some additional costs in addition to the general inflation.

And we've also seen that buying equipment in Norway seems like that has increased more than the general inflation, both when it goes to maintenance and also when it goes to investments. So we've seen some cost increases above inflation so far. Whether that will continue is difficult to say. Our aim is to keep our cost increases at or below the general inflation and expect more productivity gains. But it's a bit early to see how that will develop.

Then there is a question on costs related to antidumping. It also comes from Elliott Jones at Danske Bank. With regards to the antidumping allegations, can you provide some color as it -- as to any potential costs you expect to realize, if any, in connection with this?

Yes. As most of you know, U.S. lawyers and experts are quite expensive compared to what we see here in this country. So this will affect our cost going forward. It's still early days, so it's difficult for us to estimate how much this will cost. It's a limited number of products that are involved on our side. So that will bring the cost a bit down. But we are talking some millions in cost here, whether it will be more than NOK 10 million in cost is too early to tell, but we are talking about low double-digit number, I would say.

Next question is related to wood costs. It comes from Mr. Magnus Rasmussen at SEB. Is there a change in wood cost guidance versus what you said at the second quarter?

Not really. If we talk about the price reduction on wood, that's the same. But what we saw in the third quarter, and it will probably have an impact on the full quarter is really that we had a change in the mix. We switch between chips and round wood when we buy wood. And we will transport to distances also a bit varying depending on where the wood is cut.

And also this quarter, we had quite a high and a higher-than-normal inventory of wood at old higher prices. So that affected the third quarter. That was probably a bit more than we had expected also. So the fourth quarter should be better. It's still -- the mix is always a question, but I think we are pretty much in line with what we said, but maybe it will be a little bit higher due to the cost we saw in the third quarter.

Next question is related to average sales price development in BioSolutions. It comes from Mr. Martin Granviken at Kepler Cheuvreux. Could you elaborate on the average sales price development in BioSolutions? If AgChem sales continues to increase, why is the average sales price in sales currency flat year-over-year and the product mix stated to be in line with last year. Wouldn't higher AgChem sales imply a more favorable product mix?

Yes. I think this is a very similar question to the one we responded to initially. So I can only repeat that we think that's related to mix within the Agri where we have a very broad portfolio of a couple of hundred products and 1,000 customers. So it will depend on which applications during the quarter takes more volume, which take less. And you had something on currency as well, Per Bjarne.

Yes. So currency will have an impact also going forward here.

There's another question on wood costs. Comes from Mr. Sam Bland at Moore. Could you talk about what you are seeing on wood cost, which you probably already answered. Is the cost in Q4 expected to be lower versus Q3 as well as Q4 last year? And will this continue to be a cost tailwind in 2026.

The fourth quarter, I explained and it's -- the wood cost will -- are on its way down from what we see in Norway. What you have to remember is that we have half year negotiations on price on wood. So our prices on what we buy are -- will be the same in the fourth quarter as what we bought in the third quarter. So what brought it up in the third quarter was the mix.

And what we see in the market now, the negotiations for next year, they will start from now until the end of the year. So we don't know at present what the wood price will be for next year. But what we see from Sweden and also here in Norway, we see sawmills closing down for at least a period. So there is a pressure on wood prices coming down. And of course, we hope to see more of that in 2026.

Next question is also regarding CapEx. It comes from Mr. Andres Castanos at Berenberg. He also thank you for the presentation. Just wanted to confirm that second phase of Sarpsborg bottlenecking was already included in the CapEx guidance shared in the 2024 Capital Markets Day for the year 2026.

Yes. And the answer is yes, it was.

There is one more question regarding wood cost again. So I think you've already explained that. It comes from Mr. Niclas Gehin at DNB Carnegie. Could you give a rough estimate of how much the effect of higher wood cost in the beginning of the quarter was related to what it would have been with a new wood cost for the rest of the second half.

Yes, I would say that the additional costs we had compared to last year in the third quarter was in the range NOK 10 million to NOK 15 million. And that will -- it will be in that range, maybe closer to NOK 10 million lower in the fourth quarter compared to the third quarter and pretty much the same compared to last year also.

There are no more questions on the web.

Yes. I just want to check if there are any questions from the audience here in Oslo.

[Indiscernible] Can you provide some color on how much deliveries were down in -- of bioethanol in -- or Q-on-Q or year-on-year?

I could give you a percentage. I think it was about 30%. But it was an extremely high delivery in the third quarter of last year. It's the highest delivery in 1 quarter that we ever ahead. So this was really more a normal delivery quarter for bioethanol. It was just that it was so high in the third quarter last year.

And one last for me. What do you expect in terms of mix in BioSolutions in Q4 on the Agri side?

Well, we don't comment specifically on mix. We just give the volume range that we expect and average sales pricing to continue. But I can say, in general, that we are positive to the development, we're seeing in Agri, as I said, it's the seventh consecutive quarter that we report growth in Agri. So the long-term picture for Agri is something we're very positive about and that our portfolio fits very well with the needs of that market.

I think that was the final question today. Thank you for your attention.

Thank you very much.

My name is Veronica Skevik Frey. And I'm Vice President Finance in Borregaard. I'm joined today by our CFO, Per Bjarne Lyngstad, and we are live from the biorefinery in Norway.

And here is the agenda for today's call. First, Per Bjarne will reiterate the outlook from the latest quarterly report. Secondly, he will discuss the disruption at the Sarpsborg site. Third, currency and commodities input, and at last the Q&A session. And regarding the Q&A session, feel free to start typing your questions in the chat function already now.

Now I will hand over to Per Bjarne, who will then reiterate the key points from the outlook given in our latest quarterly report.

Thank you, Veronica, and good afternoon, everyone. I will start with reiterating the key points from the outlook after the second quarter. And when relevant refer to comments given in the Q&A sessions at the webcast for the second quarter on the 16th of July.

When I go through the outlook for BioMaterials, I will also comment on the Stock Exchange release on the 15th of September regarding temporary disruption in production of specialty cellulose here at the site in Norway.

I will start with BioSolutions. In BioSolutions, the outlook for the full year sales volume was unchanged at about 330,000 tonnes. The sales volume in the third quarter is expected to be largely in line with the third quarter of 2024, which was 81,000 tonnes. We continue to expect a positive but limited effect from the antidumping duties on vanillin.

We've got 2 questions regarding BioSolutions at the webcast in July. The first question was related to agriculture. We were asked if strong sales into agriculture will continue into the second half of 2025 and into 2026.

We confirm that this trend has been ongoing for several quarters. Actually, this was the sixth quarter in a row where we pointed at a strong performance in agriculture. We are well positioned to benefit from green trends in agriculture and the growth spans our entire product portfolio. We think that agriculture will still be a very attractive market for Borregaard going forward.

The second question was about the outlook for lignin prices into the second half of 2025 and into 2026. Borregaard uses value-based prices where possible. Pricing has been fairly flat recently, and we don't have any more exact answer on where pricing will go from now. It will depend on how we see demand developing. Remember that we have more than 600 products in this area. If there is a strong demand across the portfolio, we will be in a better position to adjust pricing than if we see a more normal demand development.

Turning to BioMaterials. The sales volume in 2025 was at the second quarter presentation in July forecasted to be approximately 150,000 tonnes with a higher share of specialized grades than in 2024. Average prices in sales currency for the second half of 2025 were expected to remain largely unchanged from the first half of the year. The third quarter volume was projected to be between 35,000 and 38,000 tonnes.

On the 15th of September, Borregaard sent out a stock exchange release about temporary disruption in production of specialty cellulose, which will affect the third quarter and full year volumes. The disruption was due to an unforeseen outage at the facility at the Sarpsborg site, which supplies a key chemical used in the production of specialty cellulose. During the outage, cellulose production was restricted to grades outside standard specifications, resulting in delays of shipments of certain specialty cellulose grades.

Production of other products was not affected during the outage. Deliveries of specialty cellulose in the third quarter are now expected to total about 30,000 tonnes. Compared with the previously forecasted range of 35,000 to 38,000 tonnes. The estimated negative impact on the group EBITDA for the third quarter is in the range of NOK 40 million to NOK 50 million.

I can add a few more comments to the stock exchange release. The disrupted facility is now running at full capacity. The off-spec material will be sold over time, probably at reduced prices, and we expect only minor, if any, EBITDA impact from these sales in coming quarters. However, we might see a negative impact on our average sales price in the coming quarters.

At the webcast in July, we got several questions regarding the outlook for BioMaterials. The first question was about mix improvement and U.S. demand for cellulose products. As to mix improvements, the 2 closures in the U.S. and Canada by Georgia Pacific's Foley plant and the Temiscaming facility over RYAM had an impact on the overall market balance. These closures have given Borregaard openings in certain areas like high-quality casings where Georgia Pacific used to be a player in the past.

Historically, Borregaard hasn't sold much into the U.S. Last year was an exception due to the closures at the Foley and Temiscaming mills. This year, U.S. specialty volumes will be lower, especially after the implementation of import tariffs of 15% for goods from Norway from the beginning of August.

The second question was about the market balance for Specialty Cellulose going forward compared with the last 10 years. In our response, we refer to what we've said since our Capital Markets Day 3 years ago that by 2030, we expect a tight market balance. Closures at the Georgia Pacific Foley and Temiscaming mills have shifted the balance further. But the slowdown in construction has so far offset this. If construction normalizes and we achieved the expected growth rates, and a tightness will come sooner rather than later. Remember that the barriers to entry are high for other companies in the specialty cellulose business. And it's difficult for them to go into most of the specialty cellulose segments.

Then moving on to Fine Chemicals, where we expect higher sales prices and volumes for advanced bioethanol in the second half to be similar to the first half. Sales volume for Fine Chemical Intermediates is expected to increase compared with the second half of 2024.

The first question we got regarding Fine Chemicals was about bioethanol sales volumes and the stability of Fine Chemicals EBITDA over the past 3 quarters. In our response, we pointed to the fact that we had a slightly weaker product mix in the second quarter and especially for Fine Chemical Intermediates a more normalized product mix may give us a slight lift in the remaining quarters this year. The run rate for Fine Chemicals will be close to what we have seen recently, possibly a bit better in the second half than in the first half.

It's important to note that advanced bioethanol is not a typical Borregaard specialized product. The market balance sets the price, which is unusual for us. Price development depends on supply and incentives. Also, there's an ongoing EU case involving possible fraud in advanced bioethanol approvals, which could affect market balance.

The second question was, if we assume stable bioethanol prices, could Fine Chemical margins improve? The answer was, no. If you go back to what I just said, out of the markets where Borregaard is active, this is the most commodity-like market we are in. It's really all down to how the market balance will play out going forward.

Then back to the outlook and the development in important cost components. Wood costs in the second half of 2025 are expected to be approximately 5% lower than in the first half. It's important to note that our wood costs include a transportation component of 25% to 30%, with the wood itself accounting for 70% to 75% of the total costs. Based on price developments, delivery patterns and inventory levels, we expect a 5% cost reduction in the second half.

We got a question about discrepancies in wood costs between the Nordic pulp market and the rest of Europe and that other Nordic peers are guiding for larger drops. Borregaard's present wood cost has landed cost at our site in Norway, which includes a significant transportation component. So when we report a 5% reduction, the actual wood price drop is higher than the total cost reduction.

Wood cost levels in the Nordic regions are much higher than in Europe and other parts of the world. So we don't see really that we have a very different drop in the price from other companies. Then leaving the wood cost and going back to the outlook where we said that completed environmental investments will contribute positively by reducing energy costs and CO2 emissions.

As to energy costs, remember that energy consumption is normally lower in the summer season and higher during winter. About 15% of Borregaard's energy consumption is dependent on energy spot prices for electricity and LNG. For LNG, we have a 1-month delay compared with the market price, which is the Dutch TTF. Electricity prices in Norway have on average been significantly above last year's prices in our area so far in the third quarter. LNG prices have so far been marginally lower than last year's, taking the 1-month delay into consideration.

In total, we have higher spot prices, and it should, to a larger extent, be offset by Borregaard's reduced energy consumption related to the spray dryer investment at the site in Norway.

At the end of the outlook presentation, we reminded you that about you about our general disclaimer, that the geopolitical uncertainties, such as tariffs and conflicts may impact Borregaard's markets and costs. However, we did not have any specific updates on this at the second quarter presentation.

Having completed the outlook, we will point to one more element, which will have an impact on 2025 results. Borregaard has a hedging strategy for currency that delays the impact of changes in currency rates. Using currency rates as of the 15th of July, the net currency impact for the full year of 2025 was estimated to be positive by about NOK 105 million compared with 2024. And the corresponding impact for the second quarter of 2025 was estimated to be positive by about NOK 20 million compared with the second quarter of 2024.

We have continued to see a strengthening of the Norwegian kroner so far in the third quarter, especially compared with the U.S. dollar. Today, the Norwegian Central Bank lowered its policy rate by 0.25%. And the NOK has weakened slightly towards our main currencies after that. If the present currency rates continue the rest of the month, we will see a marginally lower net currency impact in the third quarter compared with the NOK 20 million based on the calculation from the 16th of July.

If today's rates continue for the rest of the year, the net currency impact will be more in the range of NOK 90 million compared with positive compared with NOK 105 million based on the calculation from the 16th of July.

I will now hand over to Veronica, who will lead a Q&A session with questions asked in the chat function on all this webcast.

Thank you, Per Bjarne.

So we will now open the floor to questions from our listeners. Please use the chat function to submit your questions, and we will address them where possible and as time permits.

And we've already got one question from Mr. Elliott Jones from Danske Bank.

Has there been any more developments concerning the antidumping filing from a U.S. company against Norway and Brazil?

What I can say about that is that the process is ongoing. We have filed our first view on volumes in the antidumping case. The volumes that was used by -- in the petition, which is what is called, when you raise an antidumping case was too high, really. It was something as far as we can see, there was something wrong with the U.S. import statistics so there was a mix of our volumes and other very low-priced volumes.

So we are in a phase where we try to straighten out errors in the foundation. But this process will go on for quite some time. Of course, we were surprised by this claim by our main competitor in specialty cellulose, RYAM. And we have a problem understanding the numbers that's in the petition. But this will take some time, as I say, and we are fighting this case together with our lawyers in the U.S.

And that was the only question so far. So that seems to conclude the Q&A session. And thank you for participating in today's pre-close call. We appreciate your interest in Borregaard. This webcast will be published -- will be published on Borregaard's website until the next pre-close call in December this year.

As a reminder, this call marks the start of our silent period during which contact with the investment community will be reduced to a minimum. We look forward to our next update and wish you all a great day ahead. Thank you, and goodbye.

Thank you.