INTERIM REPORT JANUARY – SEPTEMBER 2007

(For table see attached file)

· The loss after net financial items for the first nine months of 2007 was SEK -63 (-44) million.

· The loss after net financial items for the third quarter of 2007 was SEK -82 (1) million. The quarter was negatively impacted by costs of around SEK 30 million relating to annual maintenance shutdowns at the mills in Vallvik and Rottneros. Provisions were made in the amount of SEK 10 million in the third quarter for staff cuts to reduce the headcount by 30 at the Rottneros Mill.

· Increased raw material costs and a wood shortage had a negative impact on the January to September result in the amount of SEK 141 million, compared to the same period the previous year. Wood prices are expected to remain high for the rest of the year.

· The company is anticipating a strong pulp market. The price increases in USD announced with effect from the beginning of October have been set and the prices are expected to remain the same for the rest of the year. The weak USD rate has considerably reduced the impact of these price increases.

· A main study in the South Africa project will be finished in the beginning of 2008. If the project is implemented, Rottneros will become a joint owner in an independent company that will have the potential to achieve good profitability.

· The decision to invest in a new production plant for SilviPak in Miranda, Spain, has further increased the market interest in this type of packaging.

· Rottneros’ CEO Lars Blecko announced on 2 October that he is leaving Rottneros to take up a new post as CEO of the cash handling company Loomis, which is a subsidiary of Securitas. Lars Blecko has been President and CEO of Rottneros since autumn 1999.

· The company will not be providing a forecast for the full year 2007.

ROTTNEROS IN BRIEF

Rottneros, with its origins in the 1600s, is a non-integrated, flexible supplier of customised, high-quality paper pulp. Through continuous product development, high delivery reliability, technical support and service, Rottneros is able to adapt to meet the high expectations of its customers.

Rottneros has a total production capacity of more than 700,000 tonnes of pulp per year produced at five mills in Sweden and Spain, making the Group one of the ten biggest suppliers of market pulp in the world. Increasingly intensive product development in line with customer demands will lead to higher and more stable profitability throughout an economic cycle. The Group has a comprehensive financial hedging policy to even out earnings over the economic cycles.

THE PULP MARKET

Markets and products

The market for all grades of pulp continued to develop well in 2007. Delivery capacity utilisation for bleached chemical pulp globally for the January–August period was 94 % (96 % for the same period in 2006). Production capacity utilisation for the same period was 95 % (96 %).

The price of bleached long-fibre chemical pulp for January–September amounted to an average of USD 777 per tonne (July–September USD 803 per tonne). Price increases were implemented gradually during the third quarter resulting in an increase in the price of long-fibre chemical pulp (NBSK) to SEK 830 USD/tonne. The price of short-fibre chemical pulp was increased during the third quarter from USD 700 to USD 720.

Global producer stocks of bleached chemical pulp were at 2 945 000 tonnes at the beginning of the year, and at the end of August, the preliminary figure was 3 144 000 tonnes.

Long-fibre chemical pulp (NBSK) (produced in Vallvik)

The price at the beginning of the year was USD 730 per tonne. The price was increased on several occasions during the year and in the third quarter further price increases were implemented up to USD 830 per tonne. The robust growth in the long-fibre chemical pulp market continued during the quarter and there is currently a good balance between supply and demand.

Deliver capacity utilisation for the January–August period was 95 % (96 % for the same period in 2006), and production capacity utilisation for the same period was 96 % (95 %). Delivery capacity utilisation for the July–August period was 96 % (92 % for July–August 2006), and production capacity utilisation was 100 % (96 %).

Short-fibre chemical pulp (produced in Miranda)

The price of eucalyptus pulp (BEK) was raised during the year from USD 670 per tonne to USD 720 per tonne. The average price for the January – September period amounted to USD 686 per tonne and for July–September, USD 710 per tonne. Further increases in the price have been announced effective at the beginning of October and the price of eucalyptus pulp has been raised to USD 750 per tonne.

Delivery capacity utilisation for the January–August period was 92 % (96 % for the same period the previous year), and production capacity utilisation for the same period was 93 % (97 %). Delivery capacity utilisation for the July–August period was 92 % (90 % for July–August 2006), and production capacity utilisation was 94 % (96 %).

Mechanical pulp and CTMP (produced in Rottneros, Rockhammar and Utansjö)

The price of short-fibre CTMP increased in the third quarter to the same extent as the price of short-fibre chemical pulp, i.e. by USD 20. Further price increases have been announced with effect from the beginning of October and the price of eucalyptus pulp has been raised by USD 30 per tonne. The period was characterised by both high demand and high production levels. Delivery capacity utilisation for the January–August period was 98 % (99 % for the same period in 2006), and production capacity utilisation was 96 % (95 %).

Delivery capacity utilisation for the January–September period was 98 % (100 % for the same period 2006 and the production capacity utilisation was 96 % (95 %).

(For entire report see attached file)