Kemira Oyj - Interim report (Q1 and Q3)

Kemira Oyj's January-March 2024 Interim Report: Strong start to the year with a focused portfolio

Kemira Oyj, Interim Report, April 26, 2024 at 8.30 am (EEST)

Kemira Oyj's January-March 2024 Interim Report: Strong start to the year with a
focused portfolio

This is a summary of the January-March 2024 Interim Report. The complete report
with tables is attached to this release and available at
kemira.com/investors (https://www.kemira.com/company/investors/).

First quarter:

Kemira divested its Oil & Gas (O&G)-related portfolio on February 2, 2024. All
comparisons in this report are made to the comparison period, which includes the
Oil & Gas related portfolio. Kemira's Q1 2024 figures include around EUR 45
million of revenue and around EUR 3 million of operative EBITDA from Oil & Gas.
Kemira has also presented Oil & Gas divestment adjusted figures and performance
in relevant parts of the report, which reflect the underlying business
performance of Kemira's Pulp & Paper and Industry & Water segments. Kemira
management follows the Oil & Gas divestment adjusted figures. The adjusted
figures for the comparison period are also available in a separate stock
exchange release published on February 9, 2024 and on
kemira.com/investors (https://www.kemira.com/company/investors/).  Kemira's
outlook for 2024 includes the Oil & Gas-related portfolio until the closing date
of the divestment, February 2, 2024.

Q1 2024 performance, unadjusted for Oil & Gas divestment

  · Revenue decreased by 16% to EUR 763.3 million (906.0).

  · Operative EBITDA decreased by 16% to EUR 162.5 million (192.6). The
operative EBITDA margin was stable at a record-high level of 21.3% (21.3%). The
operative EBITDA margin improved in the Industry & Water segment. EBITDA
decreased by 16% to EUR 154.1 million (184.1). The differences between operative
and reported figures are explained by items affecting comparability, which were
mainly related to the divestment of Oil & Gas.

  · Operative EBIT decreased by 17% to EUR 117.6 million (141.9). EBIT decreased
by 18% to EUR 109.2 million (133.4).

  · Cash flow from operating activities was strong at EUR 97.7 million (96.7).

  · EPS (diluted) decreased by 19% to EUR 0.49 (0.60) mainly due to the
divestment of Oil & Gas.

Q1 2024 performance, Oil & Gas divestment adjusted

  · The Oil & Gas divestment adjusted revenue decreased by 10% to EUR 718.8
(795.6). Revenue in local currencies, excluding acquisitions and divestments,
decreased by 9% mainly as sales prices for energy-intensive pulp and bleaching
chemicals declined from an elevated comparison period. Sales volumes increased
both year-on-year and sequentially. Sales prices were rather stable
sequentially.

  · The Oil & Gas divestment adjusted operative EBITDA decreased by 6% to EUR
159.2 (169.4) mainly as sales prices for energy-intensive pulp and bleaching
chemicals declined from an elevated comparison period. The adjusted operative
EBITDA margin was strong at 22.2% (21.3%).

  · The Oil & Gas divestment adjusted operative EBIT decreased by 8% to EUR
114.4 (124.4).

Outlook for 2024 (unchanged)

Revenue
Kemira's revenue is expected to be between EUR 2,700 and EUR 3,200 million in
2024 (reported 2023 revenue: EUR 3,383.7 million).

Operative EBITDA
Kemira's operative EBITDA is expected to be between EUR 480 and EUR 580 million
in 2024 (reported 2023 operative EBITDA: EUR 666.7 million).

Assumptions behind outlook (specified)
Kemira's end-market demand (in volumes) is expected to grow slightly in 2024
following expected gradual demand recovery in the pulp and paper market. The
water treatment market is expected to remain steady in 2024. Input costs are
expected to remain rather stable during the year. The outlook assumes no major
disruptions to Kemira's manufacturing operations, supply chain or Kemira's
energy-generating assets in Finland. There is uncertainty related to the
political strikes in Finland and their implications on Kemira's customers and
Kemira. Foreign exchange rates are expected to remain at approximately current
levels. The outlook for 2024 includes the Oil & Gas business until February 2,
2024, the closing date of the divestment transaction.

Kemira's President & CEO, Antti Salminen:

 "I had the honor to start as Kemira's President and CEO in mid-February. I have
spent my first months in the role meeting our people and customers as well as
taking a holistic look at Kemira's strategy. Kemira is in excellent shape, which
provides a strong foundation to build on. We have a number of strengths: a solid
strategy, a resilient business model, committed employees, high customer
satisfaction and a very strong financial position. The recent divestment of Oil
& Gas further strengthens our business model and reduces cyclicality. It also
clarifies our strategy and confirms our commitment to sustainability. We will
continue to focus on profitable growth with water, renewable solutions, and
digital services as our priority areas. Going forward, we will increasingly
concentrate on faster execution to deliver results. Together with our committed
team, we are now reviewing our strategic initiatives and targets to see how we
can accelerate their execution and create even more value for our shareholders.

Looking at the performance of the first quarter, we started the year strongly
with our focused portfolio. Market demand continued to recover gradually and we
saw volume growth both year-on-year and sequentially in both segments. Organic
revenue growth was negative as sales prices for energy-intensive pulp and
bleaching chemicals declined from an elevated comparison period. Profitability
was very strong and the operative EBITDA margin was stable year-on-year at a
record-high level of 21.3% during Q1 2024. We had strong margin performance in
both segments driven by successful cost management and higher sales volumes. In
absolute terms, our operative EBITDA reached EUR 162 million, a great
achievement considering we closed the divestment of Oil & Gas in February. Cash
flow was also very strong during the quarter. The proceeds from the Oil & Gas
divestment further strengthened our balance sheet, which is currently record
strong with net debt / operative EBITDA at 0.6.

The pulp and paper market continued to recover gradually during Q1 2024.
However, the political strikes in Finland forced some of Kemira's pulp and paper
customers in Finland to curtail production. The strikes had a limited impact on
the Pulp & Paper segment's Q1 2024 performance, which was robust. Sales volumes
increased both sequentially and year-on-year despite the political strikes in
Finland. The segment's revenue declined to EUR 423 million as sales prices for
energy-intensive pulp and bleaching chemicals declined from an elevated
comparison period. Operative EBITDA margin was strong at 20.9%, which is an
excellent achievement.

In Industry & Water, the water treatment market remained steady on both the
municipal and industrial side. Kemira's Industry & Water segment continued its
excellent performance during the quarter. Revenue was EUR 340 million, while the
operative EBITDA margin reached a record-high of 21.8%. Kemira closed the
divestment of Oil & Gas on February 2, 2024 and the positive impacts of the
divestment were tangibly visible in our Q1 performance: improved operative
EBITDA margin and return on capital employed.

Our Annual General Meeting  held in March approved the Board of Director's
dividend proposal of EUR 0.68 (2023: EUR 0.62) per share to be paid in two
installments. The first installment was paid on April 4, 2024 and the second one
will be paid early November. After a strong start to the year, we look at the
remainder of 2024 with confidence. We have kept our outlook unchanged and
continue to expect revenue to be between EUR 2,700 and EUR 3,200 million and
operative EBITDA between EUR 480 and EUR 580 million."

KEY FIGURES AND RATIOS

EUR million                            Jan-Mar         Jan-Mar         Jan-Dec
                          2024            2023            2023
Revenue
                                         763.3           906.0         3,383.7
Revenue, O&G divestment
adjusted                                 718.8           795.6         2,889.0
Operative EBITDA
                                         162.5           192.6           666.7
Operative EBITDA, O&G
divestment adjusted                      159.2           169.4           595.9
Operative EBITDA, %
                                          21.3            21.3            19.7
Operative EBITDA %, O&G
divestment adjusted                       22.2            21.3            20.6
EBITDA
                                         154.1           184.1           540.0
EBITDA, %
                                          20.2            20.3            16.0
Operative EBIT
                                         117.6           141.9           463.0
Operative EBIT, O&G divestment
adjusted                                 114.4           124.4           415.5
Operative EBIT, %
                                          15.4            15.7            13.7
Operative EBIT %, O&G
divestment adjusted                       15.9            15.6            14.4
EBIT
                                         109.2           133.4           336.4
EBIT, %
                                          14.3            14.7             9.9
Net profit for the period
                                          79.0            95.4           211.3
Earnings per share, diluted,
EUR                                       0.49            0.60            1.28

Capital employed*
                                       2,092.9         2,244.5         2,155.5
Capital employed*, O&G
divestment adjusted                    1,874.2         1,904.7         1,856.0
Operative ROCE*, %
                                          21.0            19.4            21.5
Operative ROCE, %, O&G
divestment adjusted                       21.6            20.8            22.4
ROCE*, %
                                          14.9            18.7            15.6
Cash flow from operating
activities                                97.7            96.7           546.0
Capital expenditure excl.
acquisition                               26.2            29.1           204.9
Capital Expenditure excl.
Acquisitions, O&G divestment              26.2            26.6           187.7
adjusted
Capital expenditure
                                          26.2            31.0           206.8
Cash flow after investing
activities                               178.9            66.5           349.3
Equity ratio, % at period-end
                                            47              45              48
Equity per share, EUR
                                         10.29           10.05           10.84
Gearing, % at period-end
                                            23              45              32

*12-month rolling average

Unless otherwise stated, all comparisons in this report are made to the
corresponding period in 2023.

Kemira provides certain financial performance measures (alternative performance
measures) that are not defined by IFRS. Kemira believes that alternative
performance measures followed by capital markets and Kemira management, such as
revenue growth in local currencies, excluding acquisitions and divestments
(=organic growth), EBITDA, operative EBITDA, operative EBIT, cash flow after
investing activities, and gearing, provide useful information about Kemira's
comparable business performance and financial position. Selected alternative
performance measures are also used as performance criteria in remuneration.

Kemira's alternative performance measures should not be viewed in isolation from
the equivalent IFRS measures, and alternative performance measures should be
read in conjunction with the most directly comparable IFRS measures. Definitions
of the alternative performance measures can be found in the definitions of the
key figures in this report, as well as at www.kemira.com > Investors > Financial
information. All the figures in this report have been individually rounded, and
consequently the sum of the individual figures may deviate slightly from the
total figure presented.

Financial targets

Kemira aims for above-market revenue growth, with an operative EBITDA margin of
15-18%. The target for gearing is below 75%.

Financial reporting schedule 2024

Half-year financial report January-June 2024
                      July 17, 2024
Interim report January-September 2024
                      October 25, 2024

Capital Markets Day 2024

Kemira's Capital Markets Day will be arranged on September 26, 2024. Kemira will
give an update on the strategy's next steps and also on the financial targets in
conjunction with the Capital Markets Day.

Webcast and conference call for analysts, investors and media

Kemira will arrange a webcast for analysts, investors and the media on Friday,
April 26, 2024, starting at 10.30 am EEST (8.30 am UK time). During the webcast,
Kemira's President & CEO, Antti Salminen and CFO Petri Castrén, will present the
results. The webcast will be held in English and can be followed at
kemira.com/investors (https://www.kemira.com/company/investors/). The
presentation material and a recording of the webcast will be available on the
above-mentioned company website.

You can attend the Q&A session via conference call. You can access the
teleconference by registering on the following link:
http://palvelu.flik.fi/teleconference/?id=10010851 (https://eur03.safelinks.prote
ction.outlook.com/?url=http%3A%2F%2Fpalvelu.flik.fi%2Fteleconference%2F%3Fid%3D10
010851&data=05%7C02%7C%7Cc7a27a55d21d45d1a09b08dc41a13c50%7C34d1fad257dc449e8f806
bb30bf0e3e0%7C0%7C0%7C638457407954789173%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAw
MDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C0%7C%7C%7C&sdata=hBiP2EdGLAF
LT%2B840%2F2llGdnbebt6bkEFfGvdUdt7mo%3D&reserved=0)

After registration you will be provided with phone numbers and a conference ID
to access the conference. If you wish to ask a question please dial *5 on your
telephone keypad to enter the queue.

For more information, please contact:

Kemira Oyj
Mikko Pohjala, Vice President, Investor Relations
Tel. +358 40 838 0709
mikko.pohjala@kemira.com

Kemira is a global leader in sustainable chemical solutions for water-intensive
industries. Our customers include industrial and municipal water treatment
operators, and pulp & paper industry among others. We provide the best-suited
products and services to improve our customers' product quality, process, and
resource efficiency. Our focus is on water treatment, renewable solutions, and
digital services. In 2023, Kemira had annual revenue of around EUR 3.4 billion
and around 5,000 employees. Kemira shares are listed on the Nasdaq Helsinki Ltd.
www.kemira.com

Attachments:

04258434.pdf