A Word from the President

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2020 is a year that none of us will ever forget. In the first quarter, the COVID-19 pandemic hit the world with its full power and forced us to adapt to a new situation with unexpected challenges and uncertainty. At CellMark, we acted quickly and took decisive measures for our supply chain to remain fully operational. Once again – thanks to our most valuable assets, our people – we proved that we know how to use our agility and flexibility to pivot in times of uncertainty. Perhaps most importantly is that CellMark managed to make continual financial progress and stay profitable – a streak we have kept since the company was founded in 1984.

Given the circumstances, we managed to deliver a satisfactory result for 2020. While many companies had their toughest year ever, we relied upon our diversification and the fact that we operate across multiple industries. This is a unique strength that, over the years,
has helped us to remain successful and competitive through ups and downs.

In September, we introduced a new division: CellMark Basic Materials. This division is the result of merging two of our divisions, CellMark Metals and CellMark Basic Chemicals. The aim of the new division is to combine the best of CellMark’s metals and basic chemicals competencies, in order to provide even more value to our customers and suppliers. I am pleased to declare that our new division, especially the basic chemicals business, performed a record result in 2020.

CellMark Recycling had their best year ever. Even within this volatile environment, our trading group did an outstanding job. The division completed
the acquisition of Rocky Mountain Recycling Services, a major supplier and valued strategic partner for the last 20 years. Moreover, we started up a new CellMark

Recycling company, Charleston Recycling Services (CRS). Recycling is becoming even more important for the future, and CellMark is a leading force in both sustainability and value creation.

CellMark Paper had a demanding year, suffering from continued and unprecedented deterioration in graphic paper demand. The division implemented
a successful realignment in order to reduce operational costs while ensuring flexibility and adaptability for the business. I am very satisfied with this
progress and optimistic for the future.

CellMark Chemicals had a satisfactory year. The division opened a new manufacturing facility in Naugatuck, Connecticut, which will support the business with ingredients for food, nutraceutical, pharmaceutical, animal nutrition, and vitamins. It is a great investment that will add value to the company for many years to come.

CellMark Packaging continued to broaden the base of its products and suppliers serving the world market, including packaging grades adapted to novel distribution and packaging methods. Fiber based packaging will continue to grow in importance, drivenby sustainability requirements and how we consume goods. CellMark will be an important partner in this development.

CellMark Pulp delivered a stable and satisfactory result. Several partnerships were added, and the business continues to broaden and diversify into related fiber applications. Pulp will always be a fundamental base to a variety of grades and end uses. It has contributed to CellMark’s success since our foundation more than 36 years ago, and this will remain for the future.

The COVID-19 pandemic not only affected the markets, but also many companies’ way of working. CellMark was no exception. To stop the spread of the virus, a major percentage of our employees had to switch to working remotely from home during 2020. This rapid change made demands on our IT standards and support systems. But, we coped well with the situation, and the experience gave us great learning and further preparation for the future. We have expanded our thoughts on how we can apply more flexibility in how we work, while also continuing to live our vision of Surpassing Expectations.

Building upon our strategy in 2019, we remained focused on our core business during 2020. We aim to grow and diversify within, or very close to, the core business areas where we have our most solid experience and knowledge. Other focus areas that were important for us during the year included sustainability,
integrity, and risk control. These areas will remain in our focus during 2021.

We carried on with the process of modernizing our IT landscape and improving our cyber security. We will continue our IT and digital modernization journey in 2021.

As always, we continued our support for the PaperSeed Foundation, a non-profit organization dedicated to strengthening educational opportunities for children and youth around the world. As there is likely to be less money available for education in the wake of the pandemic, PaperSeed’s dedicated work is now more important than ever.

In no other year could the theme of this Financial Summary, “Bridging the Distance”, be more relevant or important as during 2020. We are genuinely grateful to our partners who have made it possible to continue our close partnerships by committing to new ways of communication and collaboration.

As always, we value our relationships highly and are pleased with the confidence our partners put in our professionalism.

Now, 2021 is here – and we are more than ready.

Christer Simrén,
President & CEO