Aug 07, 2012. /Lesprom Network/. UPM’s H1 cash flow from ongoing businesses improved, as the company said in the press release received by Lesprom Network. The results are as follows: Q2/2012 Earnings per share excluding special items were EUR 0.14 (0.26), and reported Euro 0.17 (0.56) EBITDA was Euro 316 million, 12.1% of sales (372 million, 15.4% of sales) EBITDA was affected by seasonally higher fixed costs and fair value losses of cash flow hedges Net debt decreased by Euro 71 million to EUR 3,385 million after the dividend payment and asset sales Q1–Q2/2012 Earnings per share excluding special items were EUR 0.36 (0.58), and reported Euro 0.39 (0.89) EBITDA was Euro 663 million, 12.7% of sales (751 million, 15.7% of sales) EBITDA increased from H2 2011 driven by improved profitability of UPM’s businesses Operating cash flow was Euro 343 million (446 million), after restructuring payments of Euro 140 million Jussi Pesonen, President and CEO, comments on the result: “The profitability of UPM’s businesses improved in the first half of the year 2012 compared to the second half of 2011. We achieved this by continuing our consistent work to reduce fixed costs. Furthermore, sales prices and raw material costs developed favourably. In the second quarter, our growth businesses – Energy, Pulp, Asian Paper and Label - maintained strong profitability. However, the Group’s operating profit was affected by the exceptional quarter in Other operations, mainly due to fair value losses in currency hedges. In Paper, deliveries recovered somewhat from the previous quarter, although this was offset by seasonally higher fixed costs. Myllykoski cost synergies were well on track with two thirds of planned benefits already realised. Despite this, Paper’s profitability level remains unacceptable. Weakness in the general economic conditions affect UPM businesses, particularly in Europe. In these conditions, the continuing realisation of Myllykoski synergies works for our benefit. UPM has used the full tool kit of industry consolidation, restructuring and cost control to improve competitiveness and cash flow, and will continue to do so. Overall, I am confident that our low cost, low investment position enables healthy free cash flow generation, regardless of the demand scenario. I would like to highlight that, since the closing of the Myllykoski acquisition in August 2011, we have reduced our net debt by approximately EUR 600 million. Also, during the second quarter, solid cash flow continued and our balance sheet strengthened further. The reliable cash flow and healthy balance sheet give us room to consider our next strategic measures. The Lappeenranta biodiesel investment is our first step in becoming the leading producer of wood-based advanced biofuels, and we will continue to evaluate future opportunities in all of our growth businesses”, Pesonen concludes.